REM Digests Set1 1.7

REMEDIAL LAW REVIEW SET 1
FILING FEES
1) RUBY SHELTER BUILDERS (RSB) V. FORMARAN,
Doctrin! For "#r"o$$ o% "&'in( t) corrct &*o#nt o% +oc,t %$, &
c&$ on t) &nn#-*nt o% ++ o% $&- in.o-.in( & r&- "ro"rt' i$ & r&-
&ction &n+ i$ c&"&/- o% "c#ni&r' $ti*&tion. It$ +oc,t %$ *#$t / "&i+
in &ccor+&nc to R#- 101, Sc. 1(&).
F&ct$! RSB obtained a P95M loan in from Romeo Tan and Roberto Obiedo,
secured by REM over 5 parcels of land in Naa !ity" RSB failed to pay t#e loan
despite bein ranted several e$tensions" %t &as areed t#at RSB s#ould
e$ecute deeds of absolute sale over t#e lands in lieu of payment 'i"e" dacion en
pao("
Since RSB did not ma)e t#e payment, Tan and Obiedo presented t#e *eeds of
+bsolute Sale and t#ey &ere able to secure T!Ts over t#e 5 parcels of land in
t#eir names"
RSB filed before t#e RT! a !omplaint aainst Tan and Obiedo for declaration of
nullity of deeds of sales and damaes" RSB,s causes of actions &ere-
'a( Pactum commissorium. and
'b( Bad fait# by Tan and Obediedo"
/pon filin its !omplaint &it# RT!, RSB paid t#e sum of P01,233 for doc)et and
ot#er leal fees, as assessed by t#e Office of t#e !ler) of !ourt" T#e !ler) of
!ourt initially considered t#e case as an action incapable of pecuniary
estimation and computed t#e doc)et and ot#er leal fees due t#ereon accordin
to Section 4'b('0(, Rule 030 of t#e Rules of !ourt '+ctions &#ere t#e value of
t#e sub5ect matter cannot be estimated("
Tan filed before t#e RT! an Omnibus Motion in &#ic# #e contended t#at t#e civil
case involved real properties, and t#e doc)et fees for &#ic# s#ould be computed
in accordance &it# Section 4'a(, not Section 4'b('0(, of Rule 030 of t#e Rules of
!ourt, as amended by +"M" No" 63787637S! &#ic# too) effect on 02 +uust
8663" Since petitioner did not pay t#e appropriate doc)et fees for t#e civil case,
RT! did not ac9uire 5urisdiction over t#e said case" :ence, Tan as)ed RT! to
issue an order re9uirin RSB to pay t#e correct and accurate doc)et fees and
s#ould RSB fail to do so, to deny and dismiss t#e case"
RT! ordered RSB to pay additional filin fee and Tan &as also ordered to pay
doc)et and filin fees on #is counterclaim"
!+ up#eld RT!, sayin t#at t#e ob5ectives of RSB in filin t#e complaint &ere to
cancel t#e deeds of sale and ultimately, to recover possession of t#e lands" %t is
t#erefore a real action" !onse9uently, t#e additional doc)et fees t#at must be
paid cannot be assessed in accordance &it# Section 4'b(" +s a real action,
Section 4'a(
0
must be applied in t#e assessment and payment of t#e proper
doc)et fee"
RT!, instead of dismissin outri#t RSB,s !omplaint, ranted RSB time to pay
t#e additional doc)et fees" *espite t#e seemin munificence of t#e RT!, RSB
refused to pay t#e additional doc)et fees assessed, believin t#at it #ad already
paid t#e correct amount before, pursuant to Section 4'b('0(, Rule 030 of t#e
Rules of !ourt, as amended"
I$$#! For t) "#r"o$$ o% "&'in( t) corrct &*o#nt o% +oc,t %$,
2)t)r or not & c&$ on t) &nn#-*nt o% ++ o% $&-, in.o-.in( & r&-
"ro"rt', i$ inc&"&/- o% "c#ni&r' $ti*&tion3 NO, THE 4ASE IS A REAL
A4TION.
H-+! No" Suc# a case is a real action"
+fter Tan and Obiedo #ad t#e *eeds of +bsolute Sale presented to t#e Reister
of *eeds, t#ey &ere already issued T!Ts over t#e real properties in 9uestion, in
t#eir o&n names" No matter #o& fastidiously RSB attempts to conceal t#em, t#e
alleations and reliefs it sou#t in its !omplaint appears to be ultimately a real
action, involvin t#e recovery by RSM of its title to and possession of t#e 5
1 ;or filin an action or a permissive OR !OMP/<SOR= counter7claim, !ROSS7!<+%M,
or money claim aainst an estate not based on 5udment, or for filin a t#ird7party, fourt#7
party, etc" complaint, or a complaint7in7intervention, if t#e total sum claimed, %N!</S%>E
O; %NTERESTS, PEN+<T%ES, S/R!:+R?ES, *+M+?ES O; @:+TE>ER A%N*, +N*
+TTORNE=,S ;EES, <%T%?+T%ON EBPENSES +N* !OSTS andCor in cases involvin
property, t#e ;+%R M+RAET value of t#e RE+< property in litiation ST+TE* %N T:E
!/RRENT T+B *E!<+R+T%ON OR !/RRENT DON+< >+</+T%ON O; T:E B/RE+/
O; %NTERN+< RE>EN/E, @:%!:E>ER %S :%?:ER, OR %; T:ERE %S NONE, T:E
ST+TE* >+</E O; T:E PROPERT= %N <%T%?+T%ON OR T:E >+</E O; T:E
PERSON+< PROPERT= %N <%T%?+T%ON +S +<<E?E* B= T:E !<+%M+NT, is-
Fro* %%cti.it' to No.. 15, 6550 7No.. 11, 6550 to No.. 15, 6558 77No.. 11, 6558 to
No.. 15, 6559 777E%%cti. No.. 11, 6559 77770" <ess t#an P066,666"66 P 285"66P
456"66PE45"66P 0,666"668" P066,666"66 or more but less t#an
P056,666"66 0666"660,866"660,366"660,266"661" P056,666"66 or more but less t#an
P866,666"66 0,856"660"566"660,456"668,666"663" P866,666"66 or more but less t#an
P856,666"66 0,E45"668,856"668,285"661,666"665" P856,666"66 or more but less t#an
P166,666"66 8,096"668,216"661,646"661,566"662" P166,666"66 or more but less t#an
P156,666"66 8,566"661,666"661,566"663,666"664" P156,666"66 or more but not t#an
P366,666"66 8,E86"661,1E6"663,666"663,566"66E" ;or eac# P0,666"66 in e$cess of
P366,666"66 08"5605"6604"5686"66 %f t#e action involves bot# a money claim and relief
pertainin to property, t#en T:E fees &ill be c#ared on bot# t#e amounts claimed and
value of property based on t#e formula prescribed in t#is pararap# a"
Att'. T. S&-.&+or : 1 : BDG ; SY 1<10
parcels of land from Tan and Obiedo"
%ndeed, RSB did not directly see) t#e recovery of title or possession of t#e
property in 9uestion, #is action for annulment of sale and #is claim for damaes
are closely intert&ined &it# t#e issue of o&ners#ip of t#e buildin &#ic#, under
t#e la&, is considered immovable property, t#e recovery of &#ic# is RSBFs
primary ob5ective" T#e prevalent doctrine is t#at &n &ction %or t) &nn#-*nt
or r$ci$$ion o% & $&- o% r&- "ro"rt' +o$ not o"r&t to %%&c t)
%#n+&*nt&- &n+ "ri* o/=cti. &n+ n&t#r o% t) c&$, 2)ic) i$ to
rco.r $&i+ r&- "ro"rt'. It i$ & r&- &ction"
4on$i+rin( t)&t t) co*"-&int i$ & r&- &ction, t) R#- r>#ir$ t)&t t)
&$$$$+ .&-# o% t) "ro"rt', or i% t)r i$ non, t) $ti*&t+ .&-#
t)ro% $)&-- / &--(+ /' t) c-&i*&nt &n+ $)&-- / t) /&$i$ in
co*"#tin( t) %$.
+ real action indisputably involves real property" T#e doc)et fees for a real
action &ould still be determined in accordance &it# t#e value of t#e real property
involved t#erein. t#e only difference is in &#at constitutes t#e acceptable value"
%n computin t#e doc)et fees for cases involvin real properties, t#e courts,
instead of relyin on t#e assessed or estimated value, &ould use t#e fair mar)et
value of t#e real properties 'as stated in t#e Ta$ *eclaration or t#e Donal
>aluation of t#e Bureau of %nternal Revenue, &#ic#ever is #i#er( or, in t#e
absence t#ereof, t#e stated value of t#e same"
Petition for Revie& is denied" *ecision of RT! orderin RSB to pay additional
doc)etCfilin fees is affirmed"
6) DO:ALL METALS INDUSTRIES, IN4. V. SE4URITY BAN?
4OR@ORATION
Non-payment ofadditional filing fees due on additional claims do not divest the
Court of the jurisdiction it already had over the case. However, after-judgment
lien for said unpaid filing fees only applies to cases (1) where the filing fees
were incorrectly assessed or paid or () where the court has discretion to fi! the
amount of the award. None of these are present in this case and award was in
fact already specified. "lso, #N$% the &upreme Court can grant e!emptions to
the payment of the fees due the courts. 'arties or even the trial court cannot
waive payment of fees.
F&ct$! Spouses <im too) a loan from Security Ban)" /nable to pay on time, t#e
<ims assined to t#e Ban) t#eir real properties includin a buildin and lot" T#e
Ban) t#en offered to lease said property to t#e <ims t#rou# *o7+ll Metals
%ndustries, %nc" '*M%( primarily for business and partly as <imFs residence" +87
year lease contract &as e$ecuted on t#e condition t#at t#e Ban) #as t#e ri#t to
pre7terminate t#e lease and s#ould t#e Ban) decide to sell t#e property, *M%
s#all #ave t#e ri#t of first refusal"
Mont#s before t#e lease &as up, t#e Ban) notified *M% t#at it &as pre7
terminatin it" @#ile neotiations &ere onoin, t#e <ims claim t#at t#ey
continued to use t#e property but t#e Ban) posted security uards at t#e said
place and t#e uards, on instructions of t#e Ban), padloc)ed t#e entrances and
barred t#e <ims and *M%,s employees from enterin, even pointin un at one
employee" Because of t#is, *M% &as unable to close several pro5ects &it#
potential clients and <ims &ere unable to retrieve personal items left at t#e
property"DMI &n+ Li*$ (DMI) t)n %i-+ & co*"-&int 2it) RT4 @&$i(%or
+&*&($ 2it) "r&'r %or t) i$$#&nc o% & TRO or "r-i*in&r' in=#nction
&(&in$t t) B&n,.
RT! directed t#e Ban) to allo& *M% to enter t#e buildin and et t#eir
mac#ineries, e9uipment and personal t#ins but *M% &as unable to find t#eir
properties" In & $#""-*nt&- co*"-&int, DMI &--(+ t)&t t) B&n,
$#rr"titio#$-' too, $#c) "ro"rti$, r$#-tin( in &++ition&- &ct#&-
+&*&($ o% o.r @61M . RT! ruled in favor of *M%, orderin t#e Ban) to pay
t#e P84M actual damaes, G moral damaes,e$emplary damaes, and
attorney,s fees"
T) B&n, *o.+ %or rcon$i+r&tion o% t) +ci$ion, >#$tionin( &*on(
ot)r t)in($ t) RT4A$ &#t)orit' to (r&nt +&*&($ con$i+rin( DMIA$
%&i-#r to "&' t) %i-in( %$ on t)ir $#""-*nt&- co*"-&int" T#e RT!
denied t#e motion" On appeal, !+ ruled in favor of t#e Ban) and denied t#e
subse9uent MR, #ence t#is petition"
I$$#$!
1. WBN t) RT4 &c>#ir+ CURISDI4TION on t) $#""-*nt&- co*"-&int
&(&in$t t) B&n, con$i+rin( DMI &n+ Li*$D %&i-#r to "&' t) %i-in( %$
on t) &*o#nt$ o% +&*&($ t)' c-&i* in it. =ES"
8" @#et#er or not t#e Ban) is liable for t#e intimidation and #arassment
committed aainst *M%" =ES"
<. WBN t) B&n, i$ LIABLE to DMI %or t) *&c)inri$, >#i"*nt, &n+
ot)r "ro"rti$ t)' &--(+-' -o$t &%tr t)' 2r /&rr+ %ro* t)
"ro"rt'. NO.
H-+-
(1) YES. T) RT4 &c>#ir+ =#ri$+iction o.r t)ir &ction %ro* t) *o*nt
t)' %i-+ t) ori(in&- co*"-&int &cco*"&ni+ /' t) "&'*nt o% t) %i-in(
%$ +# on t) $&*. T)ir non:"&'*nt o% t) &++ition&- %i-in( %$ +#
on t)ir &++ition&- c-&i*$ +i+ not +i.$t t) RT4 o% t) =#ri$+iction it
&-r&+' )&+ o.r t) c&$.
Att'. T. S&-.&+or : 6 : BDG ; SY 1<10
'8( =ES" T#e Ban) belittles t#e testimonies of t#e *M%,s &itnesses for #avin
been presented e$ parte but t#e e$ parte #earin, #avin been properly
aut#oriHed, cannot be assailed as less credible" %t &as t#e Ban),s fault t#at it
&as unable to attend t#e #earin" %t cannot profit from its lac) of dilience"
Employees of *M% testified reardin t#e Ban) uards, unmitiated use of t#eir
superior strent# and firepo&er and suc# &ere never refuted" Police testified
findin <imloc)ed in t#e buildin and bein told by a Ban) representative t#at
t#ey #ad instructions to prevent anyone from ta)in any property out of t#e
premises" @#ile t#e lease may #ave already lapsed, t#e Ban) #ad no business
#arassin and intimidatin t#e <ims and *M% employees"
'1( NO" *M%Fs stand is t#at t#e RT! correctly admitted t#e supplemental
complaint even if t#ey #ad not paid t#e filin fees due on it since suc# fees
constituted a lien any&ay on t#e 5udment a&ard" B#t t)i$ &%tr:=#+(*nt -in,
2)ic) i*"-i$ t)&t "&'*nt +"n+$ on & $#cc$$%#- Ec#tion o% t)
=#+(*nt, &""-i$ to c&$$ (1) 2)r t) %i-in( %$ 2r incorrct-'
&$$$$+ or "&i+ or (6) 2)r t) co#rt )&$ +i$crtion to %iE t) &*o#nt o%
t) &2&r+. NONE of t#ese circumstances are present in t#is case"
Hr, t) $#""-*nt&- co*"-&int $"ci%i+ %ro* t) /(innin( t) &ct#&-
+&*&($ t)&t DMI $o#()t &(&in$t t) B&n,. Sti-- DMI "&i+ no %i-in( %$ on
t) $&* &n+ (&. no r&$on %or t)ir o*i$$ion nor o%%r+ to "&' t)
$&*, *r-' $&'in( t)&t t)' +i+ not 't "&' t) %$ /c&#$ t) RT4
)&+ not &$$$$+ t)* %or it. B#t & $#""-*nt&- co*"-&int i$ -i, &n'
co*"-&int &n+ t) r#- i$ t)&t t) %i-in( %$ +# on & co*"-&int n+ to /
"&i+ #"on it$ %i-in(. T) r#-$ DO NOT r>#ir t) co#rt to *&, $"ci&-
&$$$$*nt$ in c&$$ o% $#""-*nt&- co*"-&int$. +lt#ou# t#e Ban)
brou#t up t#e 9uestion of t#eir failure to pay additional filin fees in its motion
for reconsideration, *M% made no effort to ma)e at least a late payment before
decision" 4on$>#nt-', t) tri&- co#rt $)o#-+ )&. tr&t+ t)ir
S#""-*nt&- 4o*"-&int &$ not %i-+.
*M% arues t#at t#e Ban) raised t#e issue of non7payment of additional filin
fees only after t#e RT! #ad rendered its decision, t#us &aivin its ob5ection" B#t
it i$ not %or & "&rt' to t) c&$ or .n %or t) tri&- co#rt to 2&i. t)
"&'*nt o% t) &++ition&- %i-in( %$ +# on t) $#""-*nt&- co*"-&int.
On-' t) S#"r* 4o#rt c&n (r&nt E*"tion$ to t) "&'*nt o% t) %$
+# t) co#rt$ &n+ t)$ E*"tion$ &r */o+i+ in it$ r#-$.
!ourt reinstated t#e RT! decision and ordered t#e ban) to pay damaes, but
deleted t#e claim for t#e P84M actual damaes in t#e supplemental complaint"
<) BAUTISTA .. UNANGST
Doctrin! @#ere an appellant in ood fait# paid less t#an t#e correct amount for
t#e doc)et fee because t#at &as t#e amount #e &as re9uired to pay by t#e cler)
of court, and #e promptly paid t#e balance, it is error to dismiss #is appeal
because every citiHen #as t#e ri#t to assume and trust t#at a public officer
)no&s #is duties and performs it &ell"
F&ct$! Bautista o&ns a car rental s#op" Sala) rented a car for 1 consecutive
days, at t#e rate of P0,666 per day" :o&ever, Sala) failed to return t#e car after
1 days promptin Bautista to file a complaint aainst Sala) for estafa, violation
of BP 88, and carnappin"
+fter 1 mont#s, Sala) and #is common7la& &ife '/nanst( &ere arrested by t#e
police" T#e day after, Bautista demanded t#at Sala) pay P818,148 as payment
for car rental fees, fees incurred in locatin t#e car, atty,s fees, capital ains ta$,
transfer ta$, and ot#er incidental e$penses"
Sala) said #e &as &illin to pay but #e &as s#ort on cas# so #e offered to sell to
Bautista a #ouse and lot titled in #is common7la& &ife,s name" Mrs" Bautista
areed and offered to pay t#e mortae on t#e #ouse" T#e parties areed and
so t#e case &as amicably settled" :o&ever, Sala) failed to repurc#ase t#e
property &it#in t#e stipulated period" T#us, Bautista filed a complaint for specific
performance or recovery of possession, for a sum of money, for consolidation of
o&ners#ip and damaes aainst respondent and ot#er unnamed persons before
t#e RT! of Olonapo !ity"
T#e RT! decided in favour of Bautista" /nanstCSala) failed to appeal on time"
So /nanst filed a petition for relief, aruin t#at s#e learned of t#e decision
belatedly because of #er late receipt of a copy of t#e motion for e$ecution by
Bautista" Bautista t#en moved for t#e dismissal of /nanst petition on t#e
round t#at t#e latter paid an insufficient sum of P866 as doc)et fees"
+ccordin to t#e court, it appear t#at /nanst initially paid P866 as doc)et fees
as t#is &as t#e amount assessed by t#e !ler) of !ourt of t#e RT!" T#at is
insufficient because t#e proper filin fee is P0,405" Nevert#eless, t#e correct
amount &as subse9uently paid by /nanst"
I$$#! @ON t#e petition s#ould be dismissed for failure to file t#e proper doc)et
fees 'NO(
H-+! Petition for relief s#ould not be dismissed" ;ailure to pay t#e correct
amount of doc)et fees &as due to a 5ustifiable reason"
T#e ri#t to appeal is not a natural ri#t. it is a mere statutory ri#t" T#us, it must
be e$ercised only in t#e manner and in accordance &it# t#e rules provided
t#erefor" ;or t#is reason, payment of t#e full amount of t#e appellate court
doc)et and ot#er la&ful fees &it#in t#e relementary period is mandatory and
5urisdictional" Nevert#eless, t#e strict application of t#e 5urisdictional nature of
t#e rule on payment of appellate doc)et fees may be mitiated under
e$ceptional circumstances to better serve t#e interest of 5ustice" %t is al&ays
&it#in t#e po&er of t#is !ourt to suspend its o&n rules, or to e$cept a particular
case from t#eir operation, &#enever t#e purposes of 5ustice re9uire it"
Att'. T. S&-.&+or : < : BDG ; SY 1<10
%n &egovia v. (arrios, t#e !ourt ruled t#at &#ere an appellant in ood fait# paid
less t#an t#e correct amount for t#e doc)et fee because t#at &as t#e amount #e
&as re9uired to pay by t#e cler) of court, and #e promptly paid t#e balance, it is
error to dismiss #is appeal because every citiHen #as t#e ri#t to assume and
trust t#at a public officer )no&s #is duties and performs it &ell"
Tec#nicalities and procedural imperfections s#ould t#us not serve as bases of
decisions"
0) IN RE! EFEM@TION OF N@4 FROM @AYMENT OF FILINGBDO4?ET FEES
Doctrin! T#e payment of leal fees is a vital component of t#e rules
promulated by t#is !ourt concernin pleadin, practice and procedure. t#us, it
cannot be validly annulled, c#aned or modified by !onress"
F&ct$! %n *ecember 8665, t#e !ourt issued an administrative order declarin
t#at t#e National Po&er !orporation 'NP!( is e$empt from t#e payment of filin
fees, on t#e basis of Section 01 of R"+" No" 2195 or t#e NP! !#arter" :o&ever,
in October 8669, t#e !ourt issued anot#er administrative order denyin NP!
e$emption pursuant to Section 06 of its !#arter" T#e NP! t#erefore see)s
clarfification as to its e$emption"
I$$#! @CN NP! is e$empt from payment of filin fees" 'NO(
H-+! Section 88 of Rule 030 reads-

Sec" 88" ?overnment e$empt" I T#e Republic of t#e P#ilippines, its
aencies and instrumentalities are e$empt from payin t#e leal fees
provided in t#is rule" <ocal overnment units and government-owned
or controlled corporations with or without independent charters are not
e!empt from paying such fees.
%n turn, t#e Electric Po&er %ndustry Reform +ct e$pressly states t#at NP! is a
national overnment7o&ned and controlled corporation"
<i)e&ise, $inc t) "&'*nt o% -(&- %$ i$ & .it&- co*"onnt o% t) r#-$
"ro*#-(&t+ /' t)i$ 4o#rt concrnin( "-&+in(, "r&ctic &n+ "roc+#r, it
c&nnot / .&-i+-' &nn#--+, c)&n(+ or *o+i%i+ /' 4on(r$$.
T#erefore, NP! can no loner invo)e its !#arter, or any leislative rant of
e$emption, as its basis for e$emption from payment of leal fees"
8) @ROTON @ILI@INAS 4OR@ORATION .. BANGUE NATIONALE DE @ARIS
Doctrin %t is not simply t#e filin of t#e complaint or appropriate initiatory
pleadin, but t#e payment of t#e prescribed doc)et fee t#at vests a trial court
&it# 5urisdiction over t#e sub5ect matter or nature of t#e action" @#ere t#e filin
of t#e initiatory pleadin is not accompanied by t#e payment of doc)et fee, t#e
court may allo& payment of t#e fee &it#in a reasonable time but in no case
beyond t#e applicable prescriptive or relementary period"
F&ct$ Proton availed of t#e credit facilities of BNPC to uarantee t#e payment of
its obliation, its co7petitioners e$ecuted a corporate uarantee" BNP and
Proton t#e entered t#ree trust receipt areements" /nder t#e terms of &#ic#,
Proton &ould receive imported passener motor ve#icles and #old t#em in trust
for BNP" Proton &ould be free to sell t#e ve#icles sub5ect to t#e condition t#at it
&ould deliver t#e proceeds of t#e sale to BNP, to be applied to its obliations to
it" %n case ve#icles are not sold, Proton &ould return t#em to BNP toet#er &it#
all t#e accompanyin documents" Proton t#en failed to deliver t#e proceeds and
return t#e unused motor ve#icles" Ma)ati RT! !ler) of !ourt assessed t#e
doc)et fees &#ic# BNP paid" Proton filed a Motion to *ismiss on t#e round t#at
BNP failed to pay t#e correct doc)et fees and t#us prevented t#e court from
ac9uirin 5urisdiction over t#e case" %n addition, petitioners cited +dministrative
!ircular No" 00793 and arued t#at BNP failed to pay t#e correct doc)et fees as
t#e said circular provides t#at in t#e assessment t#ereof, interest claimed s#ould
be included" Petitioner contends t#at t#e complaint s#ould #ave been dismissed
for failure to specify t#e amount of interest in t#e prayer"
I$$# @#et#er t#e !ourt ac9uired 5urisdiction despite t#e insufficiency of t#e
doc)et fees paidJ =ES
H-+ %n t#e case of Manc#ester, t#e court #eld t#at t#e court ac9uires
5urisdiction over any case only upon t#e payment of t#e prescribed doc)et fees,
#ence it concluded t#at t#e T! did not ac9uire 5urisdiction over t#e case"
:o&ever, t#e said rulin &as clarified d in t#e case of Sun %nsurance &#erein
t#e court presented a more liberal interpretation of t#e rules because in t#e case
of Sun %nsurance, t#e private respondent demonstrated #is &illinness to abide
by t#e rules by payin t#e additional doc)et fees as re9uired" %t is not simply t#e
filin of t#e complaint or appropriate initiatory pleadin, but t#e payment of t#e
prescribed doc)et fee t#at vests a trial court &it# 5urisdiction over t#e sub5ect
matter or nature of t#e action" @#ere t#e filin of t#e initiatory pleadin is not
accompanied by t#e payment of doc)et fee, t#e court may allo& payment of t#e
fee &it#in a reasonable time but in no case beyond t#e applicable prescriptive or
relementary period" T#e same rule applies to permissive counterclaims, t#ird
party claims and similar pleadins"
T#us &#en insufficient filin fees &ere initially paid by t#e plaintiffs and t#ere
&as no intention to defraud t#e overnment, t#e Manc#ester rule does not
apply" %n t#e case at bar, respondent merely relied on t#e assessment made by
t#e cler) of court &#ic# turned out to be incorrect" /nder t#e circumstances, t#e
cler) of court #as t#e responsibility of reassessin &#at respondent must pay
&it#in t#e prescriptive period, failin &#ic# t#e complaint merits dismissal"

@it# respect to t#e interest accruin after t#e filin of t#e complaint, t#e same
can only be determined after a final 5udment #as been #anded do&n" T#e
Att'. T. S&-.&+or : 0 : BDG ; SY 1<10
e$ception contemplated as to claims not specified or to claims alt#ou#
specified are left for determination of t#e court is limited to any damaes t#at
may arise after t#e filin of t#e complaint or similar pleadin for t#en it &ill not be
possible for t#e claimant to specify nor speculate as to t#e amount t#ereof"
9) REGUEST OF NATIONAL 4OMMITTEE ON LEGAL AID TO EFEM@T
LEGAL AID 4LIENTS FROM @AYING FILING AND DO4?ET FEES
'super s#ort facts lan un diest" 96K t#e diest is a copy of t#e +M #a#a(
Doctrin! T) 4on$tit#tion (#&r&nt$ t) ri()t$ o% t) "oor to %r &cc$$
to t) co#rt$ &n+ to &+>#&t -(&- &$$i$t&nc. T) -(&- &i+ $r.ic
rn+r+ /' t) N4LA &n+ -(&- &i+ o%%ic$ o% IB@ c)&"tr$ n&tion2i+
&++r$$$ on-' t) ri()t to &+>#&t -(&- &$$i$t&nc. Rci"int$ o% t)
$r.ic o% t) N4LA &n+ -(&- &i+ o%%ic$ o% IB@ c)&"tr$ *&' n=o' %r
&cc$$ to co#rt$ /' E*"tin( t)* %ro* t) "&'*nt o% %$ &$$$$+ in
connction 2it) t) %i-in( o% & co*"-&int or &ction in co#rt. Wit) t)$ t2in
initi&ti.$, t) (#&r&nt o% Sction 11, Artic- III o% 4on$tit#tion i$
&+.&nc+ &n+ &cc$$ to =#$tic i$ incr&$+ /' /ri+(in( & $i(ni%ic&nt (&"
&n+ r*o.in( & *&=or ro&+/-oc,.
F&ct$! On September 81, 866E t#e Misamis Oriental !#apter of t#e %BP
promulated Resolution No" 83, series of 866E" T#e resolution re9uested t#e
%BP,s National !ommittee on <eal +id 'N!<+( to as) for t#e e$emption from
t#e payment of filin, doc)et and ot#er fees of clients of t#e leal aid offices in
t#e various %BP c#apters"
I$$#! &Cn t#e re9uest of t#e Misamis Oriental !#apter of t#e %BP t#at t#e leal
aid office clients s#ould be e$empt from payment of filin, doc)et, and ot#er fees
s#ould be ranted I =ES
H-+! Acc$$ to =#$tic /' &--, $"ci&--' /' t) "oor, i$ not $i*"-' &n
i+&- in o#r $ocit'. It$ Ei$tnc i$ $$nti&- in & +*ocr&c' &n+ in t)
r#- o% -&2. A$ $#c), it i$ (#&r&nt+ /' no -$$ t)&n t) %#n+&*nt&- -&2!
Sc. 11. Fr &cc$$ to t) co#rt$ &n+ >#&$i:=#+ici&- /o+i$ &n+
&+>#&t -(&- &$$i$t&nc $)&-- not / +ni+ to &n' "r$on /'
r&$on o% "o.rt'.

T) 4o#rt rco(niH$ t) ri()t o% &cc$$ to =#$tic &$ t) *o$t i*"ort&nt
"i--&r o% -(&- *"o2r*nt o% t) *&r(in&-iH+ $ctor$ o% o#r $ocit'"
+mon ot#ers, it #as e$ercised its po&er to Lpromulate rules concernin t#e
protection and enforcement of constitutional ri#tsM to open t#e doors of 5ustice
to t#e underprivileed and to allo& t#em to step inside t#e courts to be #eard of
t#eir plaints" %n particular, in+i(nt -iti(&nt$ &r "r*itt+ #n+r Sction 61,
R#- < &n+ Sction 1I, R#- 101 o% t) R#-$ o% 4o#rt to /rin( $#it$ in
forma pauperis.
T) IB@, "#r$#&nt to it$ (nr&- o/=cti.$ to Ji*"ro. t) &+*ini$tr&tion
o% =#$tic &n+ n&/- t) B&r to +i$c)&r( it$ "#/-ic r$"on$i/i-it' *or
%%cti.-',K &$$i$t$ t) 4o#rt in "ro.i+in( t) "oor &cc$$ to =#$tic. %n
particular, it rn+r$ %r -(&- &i+ #n+r t) $#"r.i$ion o% t) N4LA.

Un+r t) IB@A$ G#i+-in$ Go.rnin( t) E$t&/-i$)*nt &n+ O"r&tion o%
L(&- Ai+ O%%ic$ in A-- 4)&"tr$ o% t) IB@ (G#i+-in$ on L(&- Ai+), t)
co*/in+ J*&n$ &n+ *rit t$t$K $)&-- / #$+ to +tr*in t)
-i(i/i-it' o% &n &""-ic&nt %or -(&- &i+-

+RT%!<E >%%%
TESTS

SE!" 09" Combined tests" I T#e !#apter <eal +id !ommittee or t#e NN!<+O,
as t#e case may be, s#all pass upon t#e re9uest for leal aid by t#e combined
application of t#e means test and merit test, and t#e consideration of ot#er
factors adverted to in t#e follo&in sections"

SE!" 86" Means test. I T) *&n$ t$t &i*$ &t +tr*inin( 2)t)r t)
&""-ic&nt )&$ no .i$i/- *&n$ o% $#""ort or )i$ inco* i$ ot)r2i$
in$#%%icint to "ro.i+ t) %in&nci&- r$o#rc$ nc$$&r' to n(&(
co*"tnt "ri.&t co#n$- o2in( to t) +*&n+$ %or $#/$i$tnc o% )i$
%&*i-', con$i+rin( t) n#*/r o% )i$ +"n+nt$ &n+ t) con+ition$
"r.&i-in( in t) -oc&-it'.

T#e means test s#all not be applicable to applicants &#o fall under t#e
*evelopmental <eal +id Proram suc# as Overseas ;ilipino @or)ers,
fis#ermen, farmers, &omen and c#ildren and ot#er disadvantaed roups"

SE!" 80" Merit test. I T) *rit t$t $,$ to &$crt&in 2)t)r or not t)
&""-ic&ntA$ c&#$ o% &ction or )i$ +%n$ i$ .&-i+ &n+ c)&nc$ o%
$t&/-i$)in( t) $&* &""&r r&$on&/-"

SE!" 88" #ther factors" I T#e effect of t#e <eal +id Service or of t#e failure to
render t#e same upon t#e Rule of <a&, t#e proper administration of 5ustice, t#e
public interest involved in iven cases and t#e practice of la& in t#e locality s#all
li)e&ise be considered"

SE!" 81" 'rivate practice" I !are s#all be ta)en t#at t#e <eal aid is not availed
of to t#e detriment of t#e private practice of la&, or ta)en advantae of by
anyone for personal ends"

SE!" 83" )enial" I <eal aid may be denied to an applicant already receivin
ade9uate assistance from any source ot#er t#an t#e %nterated Bar"

T) J*&n$ &n+ *rit t$t$K &""&r to / r&$on&/- +tr*in&nt$ o%
-i(i/i-it' %or co.r&( #n+r t) -(&- &i+ "ro(r&* o% t) IB@.
Nont)-$$, t)' *&' / i*"ro.+ to n$#r t)&t &n' E*"tion %ro* t)
Att'. T. S&-.&+or : 8 : BDG ; SY 1<10
"&'*nt o% -(&- %$ t)&t *&' / (r&nt+ to c-int$ o% t) N4LA &n+ t)
-(&- &i+ o%%ic$ o% t) .&rio#$ IB@ c)&"tr$ 2i-- r&--' %#rt)r t) ri()t o%
&cc$$ to =#$tic /' t) "oor. T#is &ill uarantee t#at t#e e$emption &ill
neit#er be abused nor trivialiHed" To&ards t#is end, t#e follo&in s#all be
observed by t#e N!<+ and t#e leal aid offices in %BP c#apters nation&ide in
acceptin clients and #andlin cases for t#e said clients-

A.M. No. 5L:11:1:S4 (IRR)! R! R#- on t) EE*"tion Fro* t) @&'*nt
o% L(&- F$ o% t) 4-int$ o% t) N&tion&- 4o**itt on L(&- Ai+ &n+ o%
t) L(&- Ai+ O%%ic$ in t) Loc&- 4)&"tr$ o% t) Int(r&t+ B&r o% t)
@)i-i""in$

R#- on t) EE*"tion Fro* t) @&'*nt o% L(&- F$ o% t) 4-int$ o%
t) N&tion&- 4o**itt on L(&- Ai+ (N4LA) &n+ o% t) L(&- Ai+ O%%ic$
in t) Loc&- 4)&"tr$ o% t) Int(r&t+ B&r o% t) @)i-i""in$ (IB@)

+RT%!<E %
Purpose

Sction 1. Purpose" I T#is Rule is issued for t#e purpose of enforcin t#e ri#t
of free access to courts by t#e poor uaranteed under Section 00, +rticle %%% of
t#e !onstitution" %t is intended to increase t#e access to 5ustice by t#e poor by
e$emptin from t#e payment of leal fees incidental to institutin an action in
court, as an oriinal proceedin or on appeal, 9ualified indient clients of t#e
N!<+ and of t#e leal aid offices in local %BP c#apters nation&ide"

+RT%!<E %%
*efinition of Terms

Sction 1. Definition of important terms" I ;or purposes of t#is Rule and as
used #erein, t#e follo&in terms s#all be understood to be #o& t#ey are defined
under t#is Section-

'a( L*evelopmental leal aidM means t#e rendition of leal services in public
interest causes involvin overseas &or)ers, fis#erfol), farmers, laborers,
indienous cultural communities, &omen, c#ildren and ot#er disadvantaed
roups and marinaliHed sectors.
'b( L*isinterested personM refers to t#e punong *arangay #avin 5urisdiction
over t#e place &#ere an applicant for leal aid or client of t#e N!<+ or
c#apter leal aid office resides.
'c( L;alsityM refers to any material misrepresentation of fact or any fraudulent,
deceitful, false, &ron or misleadin statement in t#e application or
affidavits submitted to support it or t#e affidavit of a disinterested person
re9uired to be submitted annually under t#is Rule &#ic# may substantially
affect t#e determination of t#e 9ualifications of t#e applicant or t#e client
under t#e means and merit tests.
'd( L<eal feesM refers to t#e leal fees imposed under Rule 030 of t#e Rules of
!ourt as a necessary incident of institutin an action in court eit#er as an
oriinal proceedin or on appeal" %n particular, it includes filin or doc)et
fees, appeal fees, fees for issuance of provisional remedies, mediation
fees, s#eriff,s fees, stenorap#er,s fees 't#at is fees for transcript of
stenorap#ic notes( and commissioner,s fees.
'e( LMeans testM refers to t#e set of criteria used to determine &#et#er t#e
applicant is one &#o #as no money or property sufficient and available for
food, s#elter and basic necessities for #imself and #is family.
'f( LMerit testM refers to t#e ascertainment of &#et#er t#e applicant,s cause of
action or #is defense is valid and &#et#er t#e c#ances of establis#in t#e
same appear reasonable and
'( LRepresentativeM refers to t#e person aut#oriHed to file an application for
leal aid in be#alf of t#e applicant &#en t#e said applicant is prevented by a
compellin reason from personally filin #is application" +s a rule, it refers
to t#e immediate family members of t#e applicant" :o&ever, it may include
any of t#e applicant,s relatives or any person or concerned citiHen of
sufficient discretion &#o #as first7#and )no&lede of t#e personal
circumstances of t#e applicant as &ell as of t#e facts of t#e applicant,s
case"

+RT%!<E %%%
!overae
Sction 1. Persons qualified for exemption from payment of legal fees. I
Persons &#o s#all en5oy t#e benefit of e$emption from t#e payment of leal fees
incidental to institutin an action in court, as an oriinal proceedin or on appeal,
ranted under t#is Rule s#all be limited only to clients of t#e N!<+ and t#e
c#apter leal aid offices"

T#e said clients s#all refer to t#ose indients 9ualified to receive free leal aid
service from t#e N!<+ and t#e c#apter leal aid offices" T#eir 9ualifications
s#all be determined based on t#e tests provided in t#is Rule"

Sction 6. Persons not covered by the Rule. I T#e follo&in s#all be
dis9ualified from t#e coverae of t#is Rule" Nor may t#ey be accepted as clients
by t#e N!<+ and t#e c#apter leal aid offices"

'a( Puridical persons. e$cept in cases covered by developmental legal aid or
public interest causes involvin 5uridical entities &#ic# are non7stoc), non7
profit oraniHations, non7overnmental oraniHations and people,s
oraniHations &#ose individual members &ill pass t#e means test provided
in t#is Rule.
'b( Persons &#o do not pass t#e means and merit tests.
'c( Parties already represented by a counsel de parte.
'd( O&ners or lessors of residential lands or buildins &it# respect to t#e filin
of collection or unla&ful detainer suits aainst t#eir tenants and
'e( Persons &#o #ave been clients of t#e N!<+ or c#apter leal aid office
previously in a case &#ere t#e N!<+ or c#apter leal aid office &it#dre& its
Att'. T. S&-.&+or : 9 : BDG ; SY 1<10
representation because of a falsity in t#e application or in any of t#e
affidavits supportin t#e said application"

Sction <. Cases not covered by the Rule. I T#e N!<+ and t#e c#apter leal
aid offices s#all not #andle t#e follo&in-

'a( !ases &#ere conflictin interests &ill be represented by t#e N!<+ and
t#e c#apter leal aid offices and
'b( Prosecution of criminal cases in court"

+RT%!<E %>
Tests of %ndiency

Sction 1. Tests for determining who may be clients of the NC!
and the legal aid offices in local "#P chapters. I T#e N!<+ or t#e c#apter
leal aid committee, as t#e case may be, s#all pass upon re9uests for leal aid
by t#e combined application of t#e means and merit tests and t#e consideration
of ot#er relevant factors provided for in t#e follo&in sections"

Sction 6. Means test$ exception" I 'a( T#is test s#all be based on t#e
follo&in criteria- 'i( t#e applicant and t#at of #is immediate family must #ave a
ross mont#ly income t#at does not e$ceed an amount double t#e mont#ly
minimum &ae of an employee in t#e place &#ere t#e applicant resides and 'ii(
#e does not o&n real property &it# a fair mar)et value as stated in t#e current
ta$ declaration of more t#an T#ree :undred T#ousand 'P166,666"66( Pesos"

%n t#is connection, t#e applicant s#all e$ecute an affidavit of indiency 'printed
at t#e bac) of t#e application form( statin t#at #e and #is immediate family do
not earn a ross income abovementioned, nor o&n any real property &it# t#e
fair value aforementioned, supported by an affidavit of a disinterested person
attestin to t#e trut# of t#e applicant,s affidavit" T#e latest income ta$ return
andCor current ta$ declaration, if any, s#all be attac#ed to t#e applicant,s
affidavit"

'b( T#e means test s#all not be applicable to applicants &#o fall under t#e
developmental leal aid proram suc# as overseas &or)ers, fis#erfol), farmers,
laborers, indienous cultural communities, &omen, c#ildren and ot#er
disadvantaed roups"

Sction <. Merit test. I + case s#all be considered meritorious if an
assessment of t#e la& and evidence at #and discloses t#at t#e leal service &ill
be in aid of 5ustice or in t#e furt#erance t#ereof, ta)in into consideration t#e
interests of t#e party and t#ose of society" + case fails t#is test if, after
consideration of t#e la& and evidence presented by t#e applicant, it appears
t#at it is intended merely to #arass or in5ure t#e opposite party or to &or)
oppression or &ron"

Sction 0. %ther relevant factors that may be considered. I T#e effect of
leal aid or of t#e failure to render t#e same upon t#e rule of la&, t#e proper
administration of 5ustice, t#e public interest involved in a iven case and t#e
practice of la& in t#e locality s#all li)e&ise be considered"

+RT%!<E >
+cceptance and :andlin of !ases
Sction 1. Procedure in accepting cases. I T#e follo&in procedure s#all be
observed in t#e acceptance of cases for purposes of t#is Rule-

'a( ;ilin of application I +n application s#all be made personally by t#e
applicant, unless t#ere is a compellin reason &#ic# prevents #im from doin
so, in &#ic# case #is representative may apply for #im" %t s#all ad#ere
substantially to t#e form made for t#at purpose" %t s#all be prepared and sined
by t#e applicant or, in proper cases, #is duly aut#oriHed representative in at least
t#ree copies"

+pplications for leal aid s#all be filed &it# t#e N!<+ or &it# t#e c#apter leal
aid committee"

T#e N!<+ s#all, as muc# as possible, concentrate on cases of paramount
importance or national impact"

Re9uests received by t#e %BP National Office s#all be referred by t#e N!<+ to
t#e proper c#apter leal aid committee of t#e locality &#ere t#e cases #ave to
be filed or are pendin" T#e c#apter president and t#e c#airman of t#e c#apter,s
leal aid committee s#all be advised of suc# referral"

'b( %ntervie& I T#e applicant s#all be intervie&ed by a member of t#e c#apter
leal aid committee or any c#apter member aut#oriHed by t#e c#apter leal aid
committee to determine t#e applicant,s 9ualifications based on t#e means and
merit tests and ot#er relevant factors" :e s#all also be re9uired to submit copies
of #is latest income ta$ returns andCor current ta$ declaration, if available, and
e$ecute an affidavit of indiency printed at t#e bac) of t#e application form &it#
t#e supportin affidavit of a disinterested person attestin to t#e trut# of t#e
applicant,s affidavit"

+fter t#e intervie&, t#e applicant s#all be informed t#at #e can follo& up t#e
action on #is application after five '5( &or)in days"

'c( +ction on t#e application I T#e c#apter leal aid committee s#all pass upon
every re9uest for leal aid and submit its recommendation to t#e c#apter board
of officers &it#in t#ree '1( &or)in days after t#e intervie& of t#e applicant" T#e
basis of t#e recommendation s#all be stated"

T#e c#apter board of officers s#all revie& and act on t#e recommendation of t#e
c#apter leal aid committee &it#in t&o '8( &or)in days from receipt
Att'. T. S&-.&+or : 1 : BDG ; SY 1<10
t#ereof. 'rovided, #o&ever, t#at in urent matters re9uirin prompt or immediate
action, t#e c#apter,s e$ecutive director of leal aid or &#oever performs #is
functions may provisionally act on t#e application, sub5ect to revie& by t#e
c#apter leal aid committee and, t#ereafter, by t#e c#apter board of officers"

T#e action of t#e c#apter board of officers on t#e application s#all be final"

'd( Cases which may *e provisionally accepted" I %n t#e follo&in cases, t#e
N!<+ or t#e c#apter leal aid office, t#rou# t#e c#apter,s e$ecutive director of
leal aid or &#oever performs #is functions may accept cases provisionally
pendin verification of t#e applicant,s indiency and an evaluation of t#e merit of
#is case"
i" @#ere a &arrant for t#e arrest of t#e applicant #as been issued.
ii" @#ere a pleadin #as to be filed immediately to avoid adverse effects
to t#e applicant.
iii" @#ere an appeal #as to be urently perfected or a petition for
certiorari, pro#ibition or mandamus filed #as to be filed immediately.
and
iv" Ot#er similar urent cases"

'e( +ssinment of control number I /pon approval of t#e c#apter board of
officers of a person,s application and t#e applicant is found to be 9ualified for
leal assistance, t#e case s#all be assined a control number" T#e numberin
s#all be consecutive startin from Panuary to *ecember of every year" T#e
control number s#all also indicate t#e reion and t#e c#apter #andlin t#e case"

E$ample-
Reion !#apter =ear Mont# Number
?M 7 Manila 7 8669 7 61 7 699

'f( %ssuance of a certification I +fter an application is approved and a control
number duly assined, t#e c#apter board of officers s#all issue a certification
t#at t#e person 't#at is, t#e successful applicant( is a client of t#e N!<+ or of t#e
c#apter leal aid office" T#e certification s#all bear t#e control number of t#e
case and s#all state t#e name of t#e client and t#e nature of t#e 5udicial action
sub5ect of t#e leal aid of t#e N!<+ or t#e leal aid office of a local %BP c#apter"

T#e certification s#all be issued to t#e successful applicant free of c#are"

Sction 6. !ssignment of cases. I +fter a case is iven a control number, t#e
c#apter board of officers s#all refer it bac) to t#e c#apter leal aid committee"
T#e c#apter leal aid committee s#all assin t#e case to any c#apter member
&#o is &illin to #andle t#e case"

%n case no c#apter member #as sinified an intention to #andle t#e case
voluntarily, t#e c#apter leal aid committee s#all refer t#e matter to t#e c#apter
board of officers toet#er &it# t#e names of at least t#ree members &#o, in t#e
c#apter leal aid committee,s discretion, may competently render leal aid on
t#e matter" T#e c#apter board of officers s#all appoint one c#apter member from
amon t#e list of names submitted by t#e c#apter leal aid committee" T#e
c#apter member c#osen may not refuse t#e appointment e$cept on t#e round
of conflict of interest or ot#er e9ually compellin rounds as provided in t#e
!ode of Professional Responsibility,
N09O
in &#ic# case t#e c#apter board of
officers s#all appoint #is replacement from amon t#e remainin names in t#e
list previously submitted by t#e c#apter leal aid committee"

T#e c#apter leal aid committee and t#e c#apter board of officers s#all ta)e t#e
necessary measures to ensure t#at cases are &ell7distributed to c#apter
members"

Sction <. Policies and guidelines in the acceptance and handling of
cases. I T#e follo&in policies and uidelines s#all be observed in t#e
acceptance and #andlin of cases-

'a( ;irst come, first served I @#ere bot# t#e complainantCplaintiffCpetitioner and
defendantC respondent apply for leal aid and bot# are 9ualified, t#e first to see)
assistance s#all be iven preference"

'b( +voidance of conflict of interest I @#ere acceptance of a case &ill ive rise
to a conflict of interest on t#e part of t#e c#apter leal aid office, t#e applicant
s#all be duly informed and advised to see) t#e services of a private counsel or
anot#er leal aid oraniHation"

@#ere #andlin of t#e case &ill ive rise to a conflict of interest on t#e part of
t#e c#apter member assined to t#e case, t#e client s#all be duly informed and
advised about it" T#e #andlin la&yer s#all also inform t#e c#apter leal aid
committee so t#at anot#er c#apter member may be assined to #andle t#e
case" ;or purposes of c#oosin t#e substitute #andlin la&yer, t#e rule in t#e
immediately precedin section s#all be observed"

'c( <eal aid is purely ratuitous and #onorary I No member of t#e c#apter or
member of t#e staff of t#e N!<+ or c#apter leal aid office s#all directly or
indirectly demand or re9uest from an applicant or client any compensation, ift
or present for leal aid services bein applied for or rendered"

'd( Same standard of conduct and e9ual treatment I + c#apter member &#o is
tas)ed to #andle a case accepted by t#e N!<+ or by t#e c#apter leal aid office
s#all observe t#e same standard of conduct overnin #is relations &it# payin
clients" :e s#all treat t#e client of t#e N!<+ or of t#e c#apter leal aid office and
t#e said client,s case in a manner t#at is e9ual and similar to #is treatment of a
payin client and #is case"

'e( ;alsity in t#e application or in t#e affidavits I +ny falsity in t#e application or
in t#e affidavit of indiency or in t#e affidavit of a disinterested person s#all be
sufficient cause for t#e N!<+ or c#apter leal aid office to &it#dra& or terminate
Att'. T. S&-.&+or : L : BDG ; SY 1<10
t#e leal aid" ;or t#is purpose, t#e c#apter board of officers s#all aut#oriHe t#e
#andlin la&yer to file t#e proper manifestation of &it#dra&al of appearance of
t#e c#apter leal aid office in t#e case &it# a motion for t#e dismissal of t#e
complaint or action of t#e errin client" T#e court, after #earin, s#all approve
t#e &it#dra&al of appearance and rant t#e motion, &it#out pre5udice to
&#atever criminal liability may #ave been incurred"

>iolation of t#is policy s#all dis9ualify t#e errin client from availin of t#e
benefits of t#is Rule in t#e future"

'f( Statement in t#e initiatory pleadin I To avail of t#e benefits of t#e Rule, t#e
initiatory pleadin s#all state as an essential preliminary alleation t#at 'i( t#e
party initiatin t#e action is a client of t#e N!<+ or of t#e c#apter leal aid office
and t#erefore entitled to e$emption from t#e payment of leal fees under t#is
Rule and 'ii( a certified true copy of t#e certification issued pursuant to Section
0'e(, of t#is +rticle is attac#ed or anne$ed to t#e pleadin"

;ailure to ma)e t#e statement s#all be a round for t#e dismissal of t#e action
&it#out pre5udice to its refilin"

T#e same rule s#all apply in case t#e client, t#rou# t#e N!<+ or c#apter leal
aid office, files an appeal"

'( +ttac#ment of certification in initiatory pleadin I + certified true copy of t#e
certification issued pursuant to Section 0'e(, of t#is +rticle s#all be attac#ed as
an anne$ to t#e initiatory pleadin"

;ailure to attac# a certified true copy of t#e said certification s#all be a round
for t#e dismissal of t#e action &it#out pre5udice to its refilin"

T#e same rule s#all apply in case t#e client, t#rou# t#e N!<+ or c#apter leal
aid office, files an appeal"

'#( Sinin of pleadins I +ll complaints, petitions, ans&ers, replies,
memoranda and ot#er important pleadins or motions to be filed in courts s#all
be sined by t#e #andlin la&yer and co7sined by t#e c#airperson or a member
of t#e c#apter leal aid committee, or in urent cases, by t#e e$ecutive director
of leal aid or &#oever performs #is functions"

Ordinary motions suc# as motions for e$tension of time to file a pleadin or for
postponement of #earin and manifestations may be sined by t#e #andlin
la&yer alone"

'i( Motions for e$tension of time or for postponement I T#e filin of motions for
e$tension of time to file a pleadin or for postponement of #earin s#all be
avoided as muc# as possible as t#ey cause delay to t#e case and prolon t#e
proceedins"

'5( Transfer of cases I Transfer of cases from one #andlin la&yer to anot#er
s#all be affected only upon approval of t#e c#apter leal aid committee"

Sction 0. Decision to appeal. I 'a( +ll appeals must be made on t#e re9uest
of t#e client #imself" ;or t#is purpose, t#e client s#all be made to fill up a re9uest
to appeal"

'b( Only meritorious cases s#all be appealed" %f t#e #andlin la&yer, in
consultation &it# t#e c#apter leal aid committee, finds t#at t#ere is no merit to
t#e appeal, t#e client s#ould be immediately informed t#ereof in &ritin and t#e
record of t#e case turned over to #im, under proper receipt" %f t#e client insists
on appealin t#e case, t#e la&yer #andlin t#e case s#ould perfect t#e appeal
before turnin over t#e records of t#e case to #im"

Sction 8. Protection of private practice. I /tmost care s#all be ta)en to
ensure t#at leal aid is neit#er availed of to t#e detriment of t#e private practice
of la& nor ta)en advantae of by anyone for purely personal ends"

+RT%!<E >%
@it#dra&al of <eal +id and Termination of E$emption

Sction 1. &ithdrawal of legal aid. I T#e N!<+ or t#e c#apter leal aid
committee may, in 5ustifiable instances as provided in t#e ne$t Section, direct
t#e #andlin la&yer to &it#dra& representation of a client,s cause upon approval
of t#e %BP Board of ?overnors 'in t#e case of t#e N!<+( or of t#e c#apter board
of officers 'in t#e case of t#e c#apter leal aid committee( and t#rou# a proper
motion filed in !ourt"

Sction 6. 'rounds for withdrawal of legal aid. I @it#dra&al may be
&arranted in t#e follo&in situations-

'a( %n a case t#at #as been provisionally accepted, &#ere it is subse9uently
ascertained t#at t#e client is not 9ualified for leal aid.
'b( @#ere t#e client,s income or resources improve and #e no loner 9ualifies
for continued assistance based on t#e means test" ;or t#is purpose, on or
before Panuary 05 every year, t#e client s#all submit an affidavit of a
disinterested person statin t#at t#e client and #is immediate family do not
earn a ross income mentioned in Section 8, +rticle >, nor o&n any real
property &it# t#e fair mar)et value mentioned in t#e same Section.
'c( @#en it is s#o&n or found t#at t#e client committed a falsity in t#e
application or in t#e affidavits submitted to support t#e application.
'd( @#en t#e client subse9uently enaes a de parte counsel or is provided
&it# a de oficio counsel.
'e( @#en, despite proper advice from t#e #andlin la&yer, t#e client cannot be
refrained from doin t#ins &#ic# t#e la&yer #imself ou#t not do under t#e
et#ics of t#e leal profession, particularly &it# reference to t#eir conduct
to&ards courts, 5udicial officers, &itnesses and litiants, or t#e client insists
Att'. T. S&-.&+or : I : BDG ; SY 1<10
on #avin control of t#e trial, t#eory of t#e case, or stratey in procedure
&#ic# &ould tend to result in incalculable #arm to t#e interests of t#e client.
'f( @#en, despite notice from t#e #andlin la&yer, t#e client does not
cooperate or coordinate &it# t#e #andlin la&yer to t#e pre5udice of t#e
proper and effective rendition of leal aid suc# as &#en t#e client fails to
provide documents necessary to support #is case or unreasonably fails to
attend #earins &#en #is presence t#ereat is re9uired. and
'( @#en it becomes apparent t#at t#e representation of t#e client,s cause &ill
result in a representation of conflictin interests, as &#ere t#e adverse party
#ad previously enaed t#e services of t#e N!<+ or of t#e c#apter leal aid
office and t#e sub5ect matter of t#e litiation is directly related to t#e
services previously rendered to t#e adverse party"

Sction <. (ffect of withdrawal. I T#e court, after #earin, s#all allo& t#e
N!<+ or t#e c#apter leal aid office to &it#dra& if it is satisfied t#at t#e round
for suc# &it#dra&al e$ists"
E$cept &#en t#e &it#dra&al is based on pararap#s 'b(, 'd( and '( of t#e
immediately precedin Section, t#e court s#all also order t#e dismissal of t#e
case" Suc# dismissal is &it#out pre5udice to &#atever criminal liability may #ave
been incurred if t#e &it#dra&al is based on pararap# 'c( of t#e immediately
precedin Section"

+RT%!<E >%%
Miscellaneous Provisions
Sction 1. ien on favorable )udgment" I T#e amount of t#e doc)et and ot#er
la&ful fees &#ic# t#e client &as e$empted from payin s#all be a lien on any
5udment rendered in t#e case favorable to t#e indient, unless t#e court
ot#er&ise provides"

%n case, attorney,s fees #ave been a&arded to t#e client, t#e same s#all belon
to t#e N!<+ or to t#e c#apter leal aid office t#at rendered t#e leal aid, as t#e
case may be" %t s#all form part of a special fund &#ic# s#all be e$clusively used
to support t#e leal aid proram of t#e N!<+ or t#e c#apter leal aid office" %n
t#is connection, t#e c#apter board of officers s#all report t#e receipt of attorney,s
fees pursuant to t#is Section to t#e N!<+ &it#in ten '06( days from receipt
t#ereof" T#e N!<+ s#all, in turn, include t#e data on attorney,s fees received by
%BP c#apters pursuant to t#is Section in its li9uidation report for t#e annual
subsidy for leal aid"

Sction 6. Duty of NC! to prepare forms. I T#e N!<+ s#all prepare t#e
standard forms to be used in connection &it# t#is Rule" %n particular, t#e N!<+
s#all prepare t#e follo&in standard forms- t#e application form, t#e affidavit of
indiency, t#e supportin affidavit of a disinterested person, t#e affidavit of a
disinterested person re9uired to be submitted annually under Section 8'b(,
+rticle >%, t#e certification issued by t#e N!<+ or t#e c#apter board of officers
under Section 0'f(, +rticle > and t#e re9uest to appeal"

T#e said forms, e$cept t#e certification, s#all be in ;ilipino" @it#in si$ty '26(
days from receipt of t#e forms from t#e N!<+, t#e c#apter leal aid offices s#all
ma)e translations of t#e said forms in t#e dominant dialect used in t#eir
respective localities"

Sction <. (ffect of Rule on right to bring suits in forma pauperis. I Not#in
in t#is Rule s#all be considered to preclude t#ose persons not covered eit#er by
t#is Rule or by t#e e$emption from t#e payment of leal fees ranted to clients
of t#e Public +ttorney,s Office under Section 027* of R+ 9362 to litiate in forma
pauperis under Section 80, Rule 1 and Section 09 Rule 030 of t#e Rules of
!ourt"

Sction 0. Compliance with Rule on Mandatory egal !id *ervice. I <eal
aid service rendered by a la&yer under t#is Rule eit#er as a #andlin la&yer or
as an intervie&er of applicants under Section 0'b(, +rticle %> #ereof s#all be
credited for purposes of compliance &it# t#e Rule on Mandatory <eal +id
Service"

T#e c#airperson of t#e c#apter leal aid office s#all issue t#e certificate similar
to t#at issued by t#e !ler) of !ourt in Section 5'b( of t#e Rule on Mandatory
<eal +id Service"

+RT%!<E >%%%
Effectivity

Sction 1. (ffectivity. I T#is Rule s#all become effective after fifteen days
follo&in its publication in a ne&spaper of eneral circulation"

T#e above rule, in con5unction &it# Section 80, Rule 1 and Section 09, Rule 030
of t#e Rules of !ourt, t#e Rule on Mandatory <eal +id Service and t#e Rule of
Procedure for Small !laims !ases, s#all form a solid base of rules upon &#ic#
t#e ri#t of access to courts by t#e poor s#all be implemented" @it# t#ese rules,
&e e9uip t#e poor &it# t#e tools to effectively, efficiently and easily enforce t#eir
ri#ts in t#e 5udicial system"
E>#it' 2i-- not $#%%r & 2ron( to / 2it)o#t & r*+'. +bi )us ibi
remedium. W)r t)r i$ & ri()t, t)r *#$t / & r*+'. T) r*+'
*#$t not on-' / %%cti. &n+ %%icint, /#t &-$o r&+i-' &cc$$i/-. For &
r*+' t)&t i$ in&cc$$i/- i$ no r*+' &t &--.

T) 4on$tit#tion (#&r&nt$ t) ri()t$ o% t) "oor to %r &cc$$ to t)
co#rt$ &n+ to &+>#&t -(&- &$$i$t&nc. T) -(&- &i+ $r.ic rn+r+ /'
t) N4LA &n+ -(&- &i+ o%%ic$ o% IB@ c)&"tr$ n&tion2i+ &++r$$$ on-'
t) ri()t to &+>#&t -(&- &$$i$t&nc. Rci"int$ o% t) $r.ic o% t)
Att'. T. S&-.&+or : 15 : BDG ; SY 1<10
N4LA &n+ -(&- &i+ o%%ic$ o% IB@ c)&"tr$ *&' n=o' %r &cc$$ to
co#rt$ /' E*"tin( t)* %ro* t) "&'*nt o% %$ &$$$$+ in
connction 2it) t) %i-in( o% & co*"-&int or &ction in co#rt. Wit) t)$ t2in
initi&ti.$, t) (#&r&nt o% Sction 11, Artic- III o% 4on$tit#tion i$
&+.&nc+ &n+ &cc$$ to =#$tic i$ incr&$+ /' /ri+(in( & $i(ni%ic&nt (&"
&n+ r*o.in( & *&=or ro&+/-oc,.

T#e Misamis Oriental !#apter of t#e %nterated Bar of t#e P#ilippines is
comended for #elpin increase t#e access to 5ustice by t#e poor" T#e re9uest of
t#e Misamis Oriental !#apter for t#e e$emption from t#e payment of filin,
doc)et and ot#er fees of t#e clients of t#e leal aid offices of t#e various %BP
c#apters is ranted" T#e Rule on t#e E$emption ;rom t#e Payment of <eal
;ees of t#e !lients of t#e National !ommittee on <eal +id 'N!<+( and of t#e
<eal +id Offices in t#e <ocal !#apters of t#e %nterated Bar of t#e P#ilippines
'%BP( '&#ic# s#all be assined t#e doc)et number +"M" No" 6E700747S! N%RRO
provided in t#is resolution is approved"
1) GUERY OF MR. ROGER @RIORES4HI
Doctrin- !ourts cannot rant to foundations li)e t#e ?ood S#ep#erd
;oundation, %nc" t#e same e$emption from payment of leal fees ranted to
indient litiants even if t#e foundations are &or)in for indient and
underprivileed people" T#e clear intent and precise lanuae of t#e
afore9uoted provisions of t#e Rules of !ourt indicate t#at on-' & n&t#r&- "&rt'
-iti(&nt *&' / r(&r++ &$ &n in+i(nt -iti(&nt. T#e ?ood S#ep#erd
;oundation, %nc", bein a corporation invested by t#e State &it# a 5uridical
personality separate and distinct from t#at of its members" +s a 5uridical person,
it cannot be accorded t#e e$emption from leal and filin fees ranted to
indient litiants"
F&ct$- Mr" Roer !" Prioresc#i, administrator of t#e ?ood S#ep#erd ;oundation,
%nc" &rote a letter to t#e !#ief Pustice as)in- !an t#e !ourts rant to our
;oundation &#o &or)s for indient and underprivileed people, t#e same option
ranted to indient peopleJ Because t#e ;oundation #as served t#e poorest of
t#e poor, t#e underprivileed and marinaliHed, and all of ;ilipino society"
I$$#- @CN ?ood S#ep#erd ;oundation %nc", a corporation t#at #elps indient
and underprivileed people, s#ould be e$empted from leal fees" NOQ
H-+- !ourts cannot rant to foundations li)e t#e ?ood S#ep#erd ;oundation,
%nc" t#e same e$emption from payment of leal fees ranted to indient litiants
even if t#e foundations are &or)in for indient and underprivileed people"T#e
basis for t#e e$emption from leal and filin fees is t#e free access clause,
embodied in Sec" 00, +rt" %%% of t#e 09E4 !onstitution, t#us- R+ree access to the
courts and ,uasi judicial *odies and ade,uate legal assistance shall not *e
denied to any person *y reason of poverty.R
%n implementation of t#e ri#t of free access under t#e !onstitution, t#e
Supreme !ourt promulated rules, specifically, Ro! Sec" 80, Rule 1-
*ec, -.. -ndigent party. . " party may *e authori/ed to litigate his action, claim
or defense as an indigent if the court, upon an e! parte application and hearing,
is satisfied that the party is one who has no money or property sufficient and
availa*le for food, shelter and *asic necessities for himself and his family.
&uch authority shall include an e!emption from payment of doc0et and other
lawful fees, and of transcripts of stenographic notes which the court may order
to *e furnished him. 1he amount of the doc0et and other lawful fees which the
indigent was e!empted from paying shall *e a lien on any judgment rendered in
the case favora*le to the indigent, unless the court otherwise provides.
"ny adverse party may contest the grant of such authority at any time *efore
judgment is rendered *y the trial court. -f the court should determine after
hearing that the party declared as an indigent is in fact a person with sufficient
income or property, the proper doc0et and other lawful fees shall *e assessed
and collected *y the cler0 of court. -f payment is not made within the time fi!ed
*y the court, e!ecution shall issue for the payment thereof, without prejudice to
such other sanctions as the court may impose. (a)
T#e clear intent and precise lanuae of t#e provisions of t#e Rules of !ourt
indicate t#at only a natural party litiant may be rearded as an indient litiant"
T#e ?ood S#ep#erd ;oundation, %nc", bein a corporation invested by t#e State
&it# a 5uridical personality separate and distinct from t#at of its members, is a
5uridical person" +mon ot#ers, it #as t#e po&er to ac9uire and possess property
of all )inds as &ell as incur obliations and brin civil or criminal actions, in
conformity &it# t#e la&s and reulations of t#eir oraniHation" +s a 5uridical
person, t#erefore, it cannot be accorded t#e e$emption from leal and filin fees
ranted to indient litiants" T#at t#e ?ood S#ep#erd ;oundation, %nc" is
&or)in for indient and underprivileed people is of no moment" !learly, t#e
!onstitution #as e$plicitly premised t#e free access clause on a person,s
poverty, a condition t#at only a natural person can suffer"
T#ere are ot#er reasons t#at &arrant t#e re5ection of t#e re9uest for e$emption
in favor of a 5uridical person" ;or one, e$tendin t#e e$emption may be prone to
abuse 'even &it# t#e imposition of riid documentation re9uirements(" +lso, t#e
scrutiny of compliance &it# t#e documentation re9uirements may prove too
time7consumin and &asteful for t#e courts"
Att'. T. S&-.&+or : 11 : BDG ; SY 1<10
CURISDI4TION
1) THORNTON V. THORNTON (IN THE MATTER OF A@@LI4ATION FOR THE
ISSUAN4E OF A WRIT OF HABEAS 4OR@US (6550)
Doctrin! T#e provisions of R+ E129 reveal no manifest intent to revo)e t#e
5urisdiction of t#e !ourt of +ppeals and Supreme !ourt to issue &rits of #abeas
corpus relatin to t#e custody of minors" ;urt#er, it cannot be said t#at t#e
provisions of R+ E129, R+ 4698 and BP 089 are absolutely incompatible since
R+ E129 does not pro#ibit t#e !ourt of +ppeals and t#e Supreme !ourt from
issuin &rits of #abeas corpus in cases involvin t#e custody of minors" T#us,
t#e provisions of R+ E129 must be read in #armony &it# R+ 4689 and BP 089
S t#at family courts #ave concurrent 5urisdiction &it# t#e !ourt of +ppeals and
t#e Supreme !ourt in petitions for #abeas corpus &#ere t#e custody of minors is
at issue"
F&ct$! Petitioner #usband is an +merican &#o is married to t#e ;ilipino
respondent" +fter some time, t#eir marriae started #avin problems" @ife
apparently &anted to return to #er former 5ob as a Luest relations officerM in a
ni#tclub but &#en #usband ob5ected s#e started actin neliently 'e$" ?oin
out &#en #usband is not at #ome and 5ust livin t#eir c#ild &it# t#eir nei#bors("
;inally, in 8660, &ife left t#eir con5ual #ome &it# t#eir c#ild and reportedly &#en
to Puro) Mari)it in Basilan"
:usband filed a Petition for :abeas !orpus in t#e desinated ;amily !ourt in
Ma)ati but t#is &as dismissed on t#e round t#at it #as no 5urisdiction since t#e
c#ild &as in Basilan" :usband t#en &ent to Basilan to find t#em but &ife and
c#ild &ere not t#ere" :usband eventually ave up #is searc# &#en #e ot #old
of &ife,s p#one bills s#o&in calls from different parts of t#e P#ilippines"
:usband t#en filed anot#er petition for #abeas corpus &it# t#e !+, &#ic# could
issue a &rit of #abeas corpus enforceable in t#e entire country" T#is &as also
dismissed by t#e !+ on t#e follo&in round- t#e !+ did not #ave 5urisdiction
over t#e case" R+ E129 or t#e ;amily !ourts +ct of 0994 ave family courts
exclusive oriinal 5urisdiction over petitions for #abeas corpus" %t #eld t#at t#e
used of t#e &ord exclusive #as only one plain meanin and t#at if t#e !+ is
also iven t#e same 5urisdiction as t#at &#ic# is iven to family courts t#en it
&ould not be e$clusive but concurrent"
On t#e ot#er #and t#e #usband 9uestions t#is and allees t#at t#e intention of
t#e la& must prevail over t#e literal meanin of &ords employed" :e arued
t#at unless t#e !+ assumes 5urisdiction, t#e best interest of t#e c#ild &ill not be
served as &ife can easily evade t#e service of t#e &rit by 5ust movin out of t#e
reion over &it# t#e RT! family court &rit #as territorial 5urisdiction"
I$$#! @#et#er t#e !+ #as 5urisdiction to issue &rits of #abeas corpus in cases
involvin custody of minors in t#e li#t of t#e provision in R+ E129 ivin family
courts e$clusive oriinal 5urisdiction over suc# petitions" '=ES(
H-+! !+ s#ould ta)e reconiHance of t#e case since t#ere is not#in in R+
E129 t#at revo)ed t#e 5urisdiction to issue &rits of #abeas corpus involvin t#e
custody of minors"
Note2 1he Court in the end agreed with the &olicitor 3eneral that the issue is
already moot since the Rule on !ustody of Minors and @rits of :abeas !orpus
in Relation to !ustody of Minors '+"M" No" 617637637S!( already stated that C"
has jurisdiction. Nevertheless, the discussions on the issue is still relevant for
purposes of class discussion.
@e disaree &it# t#e !+,s reasonin because it &ill result in an ini9uitous
situation, leavin individuals li)e petitioner &it#out leal recourse in obtainin
custody of t#eir c#ildren" %ndividuals &#o do not )no& t#e &#ereabouts of
minors t#ey are loo)in for &ould be #elpless since t#ey cannot see) redress
from family courts &#ose &rits are enforceable only in t#eir respective territorial
5urisdictions" T#us, if a minor is bein transferred from one place to anot#er,
&#ic# seems to be t#e case #ere, t#e petitioner in a #abeas corpus case &ill be
left &it#out leal remedy" T#is lac) of recourse could not #ave been t#e intention
of t#e la&ma)ers &#en t#ey passed t#e ;amily !ourts +ct of 0994" T#e
primordial consideration is t#e &elfare and best interests of t#e c#ild" @e rule
t#erefore t#at R+ E129 did not divest t#e !ourt of +ppeals and t#e Supreme
!ourt of t#eir 5urisdiction over #abeas corpus cases involvin t#e custody of
minors"
T#is is not t#e first time t#at t#is !ourt construed t#e &ord Re$clusiveR
as not foreclosin resort to anot#er 5urisdiction" +s correctly cited by t#e Solicitor
?eneral, in +loresca vs. 'hile! 4ining Corporation, t#e #eirs of miners )illed in a
&or)7related accident &ere allo&ed to file suit in t#e reular courts even if, under
t#e @or)men,s !ompensation +ct, t#e @or)men,s !ompensation
!ommissioner #ad e$clusive 5urisdiction over suc# cases"
@e aree &it# t#e observations of t#e Solicitor ?eneral t#at-
@#ile +loresca involved a cause of action different from t#e case at
bar" it supports petitioner,s submission t#at t#e &ord Re$clusiveR in t#e
;amily !ourts +ct of 0994 may not connote automatic foreclosure of
t#e 5urisdiction of ot#er courts over #abeas corpus cases involvin
minors" %n t#e same manner t#at t#e remedies in t#e ;loresca case
&ere selective, t#e 5urisdiction of t#e !ourt of +ppeals and ;amily
!ourt in t#e case at bar is concurrent" T#e ;amily !ourt can issue &rits
of #abeas corpus enforceable only &it#in its territorial 5urisdiction" On
t#e ot#er #and, in cases &#ere t#e territorial 5urisdiction for t#e
enforcement of t#e &rit cannot be determined &it# certainty, t#e !ourt
of +ppeals can issue t#e same &rit enforceable t#rou#out t#e
P#ilippines, as provided in Sec" 8, Rule 068 of t#e Revised Rules of
!ourt"
Att'. T. S&-.&+or : 16 : BDG ; SY 1<10
%n rulin t#at t#e !ommissioner,s Re$clusiveR 5urisdiction did not foreclose resort
to t#e reular courts for damaes, t#is !ourt, in t#e same +loresca case, said
t#at it &as merely applyin and ivin effect to t#e constitutional uarantees of
social 5ustice in t#e 0915 and 0941 !onstitutions and implemented by t#e !ivil
!ode" %t also applied t#e &ell7establis#ed rule t#at &#at is controllin is t#e spirit
and intent, not t#e letter, of t#e la&-
R%dolatrous reverenceR for t#e la& sacrifices t#e #uman bein" T#e spirit
of t#e la& insures man,s survival and ennobles #im" %n t#e &ords of
S#a)espeare, Rt#e letter of t#e la& )illet#. its spirit ivet# life"R
$$$ $$$ $$$
%t is t#erefore patent t#at ivin effect to t#e social 5ustice uarantees of
t#e !onstitution, as implemented by t#e provisions of t#e Ne& !ivil
!ode, is not an e$ercise of t#e po&er of la&7ma)in, but is renderin
obedience to t#e mandates of t#e fundamental la& and t#e
implementin leislation aforementioned"
Ot#er reason provided- Statutory construction rule t#at implied repeals are not
favored"
6) Brn&/ N&.i+&, t &-. .. Hon. To+oro DiHon, Cr.
*octrine- Purisdiction of cases in &#ic# damaes of &#atever )ind
e$ceeds 066) 'or 866)( in M"Manila is &it# t#e RT!" %n cases &#ere t#e
claim for damaes is t#e main cause of action, t#e amount of suc# claim
s#all be considered in determinin t#e 5urisdiction of t#e court"
;acts- %n 0991, t#ere &ere a number of personal in5ury suits filed in
Te$as by citiHens of 08 forein countries, includin t#e P#ilippines" T#ey
sou#t damaes for in5uries from e$posure to *B!P, a c#emical used to
)ill &orms, &#ile &or)in on farms in forein countries" T#e defendants
in t#e consolidated cases prayed for t#e dismissal 'forum non
conveniens(" T#e ;ederal *istrict !ourt conditionally ranted t#e MT*"
T#e 112 plaintiffs 'Navida et al( t#en from ?enSan filed a Point
!omplaint in ?enSan RT! in 0995, aainst S#ell, *o&, Occidental,
*ole, *el Monte etc" Navida prayed for payment of damaes due to t#e
illnesses and in5uries to t#e reproductive systems" T#ey claimed t#at
t#ey &ere e$posed to t#at c#emical, and it &as due to t#e
faultCnelience of t#e defendant companies" T#e defendant companies
filed for Motions for bill of Particulars"
T#e RT!, &it#out resolvin t#e motions, issued an Order dismissin t#e
complaint, sayin it didn,t #ave 5urisdiction" Second, it said t#at t#e tort
alleed by Navida is not reconiHed by P: la&s 'product liability tort(
and t#ird, t#e filin of t#e cases &as said to be coerced and anomalous"
%t also said t#at te defendants, submission to 5urisdiction is conditional"
+lso, Navida, et al, violated rules on forum s#oppin and litis pendencia
'because of t#e Te$as court("
%n 0992, anot#er case &as filed in *avao !ity, by 055 plaintiffs 'aainst
S#ell, *O@, *el Monte, Occidental, etc"( T#ey alleed t#e same t#ins
as Navida, et al" T#e RT! 5un)ed t#e case, sayin t#at it didn,t #ave
5urisdiction over t#e sub5ect matter since +rticle 8042, and 804E of t#e
!! are broad enou# to cover suc#"
%ssue- @CN t#e RT! of ?enSan and *avao !ity erred in dismissin t#e
cases for lac) of 5urisdiction
:eld- =ES" T#ey #ave 5urisdiction"
Note- +ll parties contend t#at t#e RT!s #ave 5urisdiction, specifically for
appro$imately 8"4M for eac# of t#e claimants" Plaintiffs &anted to drop
*O@, Occidental, and S#ell, but *O<E and !#i9uita opposed
'syempre, t#ey &ould end up payin more(
Navida, et al, arue t#at t#e acts occurred in P: territory" *O<E
maintains t#at t#e acts fall under 8042, and maintains t#at t#e court may
still resolve t#e case" %t posits t#at t#e P: is t#e situs of t#e acts
committed by t#e defendant companies" !#i9uita also arues t#at t#e
courts #ave 5urisdiction" T#ey already submitted t#emselves to t#e
5urisdiction of t#e court"
T#e damaes prayed for is appro$imately 8"4M for eac#" T#e RT! #as
t#us 5urisdiction over t#e cases 'RT!, 066) or more, or 866) in MM("
T#e act #appened in t#e P#ilippines" %t &as a 9uasi7delict under +rticle
8042" +nd t#e RT! ac9uired 5urisdiction over t#e defendant companies"
T#ey voluntarily appeared before t#e !ourt, and even submitted
MotionsCPleadins"
<) L&n+ B&n, o% t) @)i-i""in$ .. 4or&Hon M. Vi--(&$, G.R. No. 1L5<L0,
M&rc) 69, 651<
Att'. T. S&-.&+or : 1< : BDG ; SY 1<10
FA4TS! <and Ban) 'petitioner( filed cases for determination of 5ust
compensation aainst
'respondent( !oraHon M" >illeas in !ivil !ase 8664703043 property
in :ibaiyo, ?ui#ulnan !ity, Neros Oriental- and
'respondent( #eirs of !atalino >" Noel and Procula P" Sy in !ivil !ase
8664703091 property in Nanca, Baya&an !ity, Neros Oriental
before t#e RT! of *umauete !ity 7 Branc# 18, sittin as a Special +rarian
!ourt for t#e province of Neros Oriental" T#e properties7lands of t#e
respondents #appened to be outside t#e reular territorial 5urisdiction of
concerned RT!"

RT!, Branc# 18 dismissed
!ivil !ase 8664703043 for lac) of 5urisdiction reasonin t#at alt#ou# it
#ad been desinated Special +rarian !ourt for Neros Oriental, t#e
desination did not e$pand its territorial 5urisdiction to #ear ararian
cases under t#e territorial 5urisdiction of t#e RT!, Branc# 23 of
?ui#ulnan !ity &#ere respondent >illeas, property can be found"
!ivil !ase 8664703091 for lac) of 5urisdiction reasonin t#at RT!,
Branc# 21 of Baya&an !ity #ad 5urisdiction over t#e case since
respondent #eirs, property &as &it#in t#e latter court,s territorial
5urisdiction"
RT! basis- *eputy !ourt +dministrator ElepaTo,s opinion t#at sinle sala courts
#ave 5urisdiction over ararian cases involvin lands located &it#in its territorial
5urisdiction t#us an RT! branc# actin as a special ararian court, s#e claimed,
did not #ave e$panded territorial 5urisdiction

<and Ban) filed
MRs on t#e dismissal of t#e t&o cases RT!- denied
petitions for certiorari to S!
>illeas, arument- adopts *!+ ElepaTo,s opinion and t#at in #earin 5ust
compensation cases, RT!, Branc# 23 in ?ui#ulnan !ity s#ould be no different
from t#e situation of ot#er sinle sala courts t#at concurrently #ear drus and
family7related cases even as t#e Supreme !ourt #as desinated family and
drus courts in *umauete !ity &it#in t#e same province" ;urt#er, ?ui#ulnan
!ity is more t#an 066 )ilometers from *umauete !ity &#ere RT!, Branc# 18
sits t#us more practical if Branc# 23 of ?ui#ulnan !ity #ears and decides t#e
case

Respondent #eirs of Noel mean&#ile #ad been paid t#eir due t#us no loner
interested in t#e outcome of t#e case"
ISSUE! &#et#er or not an RT!, actin as Special +rarian !ourt, #as
5urisdiction over 5ust compensation cases involvin aricultural lands located
outside its reular 5urisdiction but &it#in t#e province &#ere it is desinated as
an ararian court under t#e !ompre#ensive +rarian Reform <a& of 099E

HELD!
LPurisdictionM-
o court,s aut#ority to #ear and determine a case
o conferred by la&
#ere, la& t#at confers 5urisdiction on Special
+rarian !ourts desinated by t#e Supreme !ourt
in every province is R"+" 2254 or Comprehensive
"grarian 5eform $aw of 1677
Relevant parts- Sections 52 and 54 SE!" 52"
&pecial "grarian Court. 7 T#e Supreme !ourt s#all
desinate at least one '0( branc# of t#e Reional
Trial !ourt 'RT!( &it#in eac# province to act as a
Special +rarian !ourt"
U
T#e Supreme !ourt may desinate more branc#es
to constitute suc# additional Special +rarian
!ourts as may be necessary to cope &it# t#e
number of ararian cases in eac# province" %n t#e
desination, t#e Supreme !ourt s#all ive
preference to t#e Reional Trial !ourts &#ic# #ave
been assined to #andle ararian cases or &#ose
presidin 5udes &ere former 5udes of t#e defunct
!ourt of +rarian Relations"
U
T#e Reional Trial !ourt 'RT!( 5udes assined to
said courts s#all e$ercise said special 5urisdiction in
addition to t#e reular 5urisdiction of t#eir respective
courts"
SE!" 54" &pecial 8urisdiction. 7 T#e Special
+rarian !ourts s#all #ave oriinal and e$clusive
5urisdiction over all petitions for t#e determination of
5ust compensation to lando&ners, and t#e
prosecution of all criminal offenses under t#is +ct"
T#e Rules of !ourt s#all apply to all proceedins
before t#e Special +rarian !ourts unless modified
by t#is +ct"
U
T#e Special +rarian !ourts s#all decide all
appropriate cases under t#eir special 5urisdiction
&it#in t#irty '16( days from submission of t#e case
for decision"
o T:/S, an RT! branc# desinated as a Special +rarian
!ourt for a province #as t#e oriinal and e$clusive
5urisdiction over all petitions for t#e determination of 5ust
Att'. T. S&-.&+or : 10 : BDG ; SY 1<10
compensation in t#at province
o 5epu*lic v. C"2 Special +rarian !ourts #ave oriinal and
e$clusive 5urisdiction over t&o cateories of cases- '0( all
petitions for t#e determination of 5ust compensation to
lando&ners, and '8( t#e prosecution of all criminal offenses
under R"+" 2254"
By LspecialM 5urisdiction
o Special +rarian !ourts e$ercise po&er in addition to or over
and above t#e ordinary 5urisdiction of t#e RT!, suc# as
ta)in coniHance of suits involvin aricultural lands located
outside t#eir reular territorial 5urisdiction, so lon as t#ey are
&it#in t#e province &#ere t#ey sit as Special +rarian !ourts
o R"+" 2254 re9uires t#e desination by t#e S! before an RT!
Branc# can function as a Special +rarian !ourt
:ere, S! #as not desinated t#e sinle sala courts
of RT!, Branc# 23 of ?ui#ulnan !ity and RT!,
Branc# 21 of Baya&an !ity as Special +rarian
!ourts conse9uence- t#ey cannot #ear 5ust
compensation cases 5ust because t#e lands sub5ect
of suc# cases #appen to be &it#in t#eir territorial
5urisdiction
Since RT!, Branc# 18 of *umauete !ity is t#e
desinated Special +rarian !ourt for t#e province
of Neros Oriental, it #as 5urisdiction over all cases
for determination of 5ust compensation involvin
aricultural lands &it#in t#at province, reardless of
&#et#er or not t#ose properties are outside its
reular territorial 5urisdiction"

*%SPOS%T%>E- ?R+NTS t#e petitions, SETS +S%*E t#e RT! orders dismissin
t#e cases for lac) of 5urisdiction and *%RE!TS RT! Branc# 18 of *umauete
!ity to immediately #ear and decide t#e t&o cases unless a compromise
areement #as in t#e meantime been approved in t#e latter case
0) VDA. DE HERRERA .. BERNARDO
Doctrin$! 0( %ssue of lac) of 5urisdiction can be raised any time, even on
appeal" + party is barred by lac#es and cannot invo)e t#e issue of lac) of
5urisdiction ON<= %N T:E !+SE O; S%BON?:+NO=- &#en t#e party
consistently invo)es t#e 5urisdiction of t#e court to avail of affirmative relief, and
&#en an adverse decision is rendered, said party cannot invo)e t#e lac) of
5urisdiction 'because of lac#es("
8( No 5urisdiction, decision is null and void"
F&ct$! Respondents are t#e #eirs of !risanto S" Bernardo, represented by
Emelita Bernardo, filed a complaint before t#e !ommission on t#e Settlement of
<and Problems '!OS<+P( aainst :errera for interference, disturbance,
unla&ful claim, #arassment and trespassin over a portion of a land in !ardona,
RiHal" T#e Bernardos claim t#at t#e land &as oriinally o&ned by t#eir
predecessor, !risanto Bernardo, and &as later ac9uired by !risanto S"
Bernardo 'yes, t#ere are 8 !risantos(, &#ic# &as covered by a Ta$ *eclaration"
Petitioner :errera alleed t#at t#e property &as bou#t by #is 'petitioner,s(
fat#er, from a certain >illaran, and petitioner in#erited t#e land from #is fat#er"
!OS<+P ruled t#at t#e Bernardos #ave a ri#tful claim over t#e land" !OS<+P
denied :errera,s MR" :errera t#us filed a Pet!ert &it# t#e !+, &#ic# dismissed
t#e petition and affirmed !OS<+P,s resolution" !+ ruled t#at !OS<+P #as
e$clusive 5urisdiction over t#e case, and even if !OS<+P #as no 5urisdiction,
:errera &as estopped from raisin t#e issue of lac) of 5urisdiction because #e
failed to raise suc# issue before !OS<+P, as it &as only raised before t#e !+"
I$$#! W)t)r 4OSLA@ )&+ =#ri$+iction3 NO.
H-+! !OS<+P &as created by EO 520 by President Marcos" %t is an
administrative body establis#ed as a means of providin a mec#anism for t#e
e$peditious settlement of land problems amon small settlers, lando&ners and
members of cultural minorities to avoid social unrest" EO 520 ranted t#e
5urisdiction of !OS<+P as follo&s-
$ $ $ assume 5urisdiction and resolve land problems or disputes &#ic#
are critical and e$plosive in nature considerin, for instance, t#e lare
number of parties involved, t#e presence or emerence of social
tension or unrest, or ot#er similar critical situations re9uirin immediate
action-
a" Bet&een occupantsCs9uatters and pasture lease areement
#olders or timber concessionaires
b" L L L and overnment reservation rantees
c" L L L and public land claimants or applicants
d" Petitions for classification, release andCor subdivision of lands of
t#e public domain
e" Ot#er similar land problems of rave urency and manitude"
4OSLA@ i$ & tri/#n&- o% -i*it+ =#ri$+iction t)&t c&n on-' 2i-+ "o2r$
2)ic) &r $"ci%ic&--' (r&nt+ to it /' it$ n&/-in( $t&t#t. 4OSLA@ )&$ 6
o"tion in & -&n+ +i$"#t! (&) r%r to "ro"r &(nc' 2it) &""ro"ri&t
=#ri$+iction, or (/) &$$#* =#ri$+iction i% t) c&$ %&--$ in t) n#*r&tion
"ro.i++ /' EO 891.
In t)i$ c&$, 4OSLA@ )&$ no =#ri$+iction. T#e present case does not fall in
any of t#e enumerated matters provided by EO 520" %t is neit#er critical nor
Att'. T. S&-.&+or : 18 : BDG ; SY 1<10
e$plosive in nature nor involve a lare number of parties, nor is t#ere t#e
presence or emerence of social tension or unrest"
T#e alleations of t#e Bernardos pertains to t#eir claim of o&ners#ip over t#e
land, &#ic# is an action involvin title to or possession of real property or any
interest t#erein, t#e 5urisdiction of &#ic# is vested &it# t#e RT!s or MT!s
dependin on t#e value of t#e real property"
Since !OS<+P #as no 5urisdiction, all proceedins #eld are null and void and
t#e resolution cannot be a source of any ri#t or create any obliation"
:errera is not estopped from raisin t#e issue of 5urisdiction because it may be
raised at any stae of t#e proceedins, even on appeal"
%n t#e case of Ti=&* .. Si/on()&no', t#e S! found t#at t#ere &as lac#es &#ic#
barred t#e defense of lac) of 5urisdiction, as said issue &as raised for t#e first
time in an MT*" Subse9uently, t#e litiant consistently invo)ed t#e 5urisdiction of
t#e courts to obtain affirmative relief" %t &as only &#en t#e litiant received an
adverse decision &#en it invo)ed t#e lac) of 5urisdiction of t#e courts"
8) HERALD DA4ASIN .. SHARON DA4ASIN
F&ct$! :erald *acasin, +merican, and S#aron *acasin, ;ilipino, &ere
married in Manila in +pril 0993" T#ey #ave one dau#ter, Step#anie" %n
0999, S#aron sou#t and obtained from t#e %llinois !ircuit !ourt a
divorce decree aainst :erald" T#e %llinois court dissolved t#eir
marriae, a&arded to S#aron sole custody of Step#anie and retained
5urisdiction over t#e case for enforcement purposes"
%n 8668, t#ey e$ecuted in Manila a contract for t#e 5oint custody of
Step#anie and c#ose P#ilippine courts as t#e e$clusive forum to
ad5udicate disputes arisin from t#e +reement" S#aron undertoo) to
obtain from t#e %llinois court an order Rrelin9uis#inR 5urisdiction to
P#ilippine courts"
%n 8663, :erald sued S#aron in t#e Ma)ati RT! to enforce t#e
+reement, allein t#at S#aron e$ercised sole custody over t#eir c#ild,
&#ic# &as in violation of t#e +reement"
S#aron sou#t t#e dismissal of t#e complaint for lac) of 5urisdiction
because of t#e %llinois court,s retention of 5urisdiction to enforce t#e
divorce decree"
RT!- *ismissed t#e case for lac) of 5urisdiction"
I$$#! @CN t#e RT! #as 5urisdiction over t#e suit and enforce t#e
+reement on t#e 5oint custody of t#e parties, c#ild I =es to t#e first but
it cannot enforce t#e +reement"
H-+! T#e trial court #as 5urisdiction to entertain :erald,s suit but not to
enforce t#e +reement &#ic# is void" :o&ever, factual and e9uity
considerations militate aainst t#e dismissal of t#e suit and call for t#e
remand of t#e case to settle t#e 9uestion of Step#anie,s custody"
Sub5ect matter 5urisdiction is conferred by la&" Statutory la& vests on
RT!s e$clusive oriinal 5urisdiction over civil actions incapable of
pecuniary estimation" +n action for specific performance, suc# as
:erald,s suit to enforce t#e +reement on 5oint c#ild custody, belons to
t#is species of actions" T#us, :erald &ent to t#e ri#t court" @#at t#e
%llinois court retained &as R5urisdiction for t#e purpose of enforcin all t#e
various provisions of NitsO Pudment for *issolution"R :erald,s suit see)s
t#e enforcement not of t#e Rvarious provisionsR of t#e divorce decree but
of t#e post7divorce +reement on 5oint c#ild custody" T#us, t#e action
lies beyond t#e Hone of t#e %llinois court,s so7called Rretained
5urisdiction"R
Note- T#is may be s)ipped since t#e case is under Purisdiction but %
included ot#er rem issues"
On !ause of +ction
:o&ever, t#e trial court cannot enforce t#e +reement &#ic# is contrary
to la&" +t t#e time t#e parties e$ecuted t#e +reement, 8 facts are
undisputed- 0( Step#anie &as under 4 yrs" old. and 8( t#e parties &ere
no loner married under /S la&s because of t#e divorce decree" T#e
relevant P#ilippine la& on c#ild custody for spouses separated in fact or
in la& is also undisputed- Rno c#ild under 4 yrs" s#all be separated from
t#e mot#er"R T#is statutory a&ardin of sole parental custody to t#e
mot#er is mandatory, sub5ect only to a narro& e$ception not alleed to
obtain #ere" !learly t#en, t#e +reement,s ob5ect to establis# a post7
divorce 5oint custody reime bet&een t#e parties over t#eir c#ild under 4
yrs" old contravenes P#ilippine la&" %t &ould be valid if t#e spouses #ave
not divorced or separated because t#e la& provides for 5oint parental
aut#ority &#en spouses live toet#er" :o&ever, upon separation of t#e
spouses, t#e mot#er ta)es sole custody under t#e la& if t#e c#ild is
belo& 4 yrs" old and any areement to t#e contrary is void"
%t could very &ell be t#at t#e la&,s bias favorin t#e mot#er over t#e
fat#er encouraes paternal nelect, presumes incapacity for 5oint
Att'. T. S&-.&+or : 19 : BDG ; SY 1<10
parental custody, robs t#e parents of custodial options, or #i5ac)s
decision7ma)in bet&een t#e separated parents" :o&ever, t#ese are
ob5ections &#ic# 9uestion t#e la&,s &isdom not its validity or uniform
enforceability" T#e forum to air and remedy t#ese rievances is t#e
leislature, not t#is !ourt"
%nstead of orderin t#e dismissal t#e suit, t#e loical end to its lac) of
cause of action, &e remand t#e case for t#e trial court to settle t#e
9uestion of Step#anie,s custody" Step#anie is no& nearly 05 yrs" old,
t#us removin t#e case outside of t#e ambit of t#e mandatory maternal
custody reime and brinin it &it#in coverae of t#e default standard
on c#ild custody proceedins I t#e best interest of t#e c#ild"
9) 4IVIL SERVI4E 4OMMISSION V. 4OURT OF A@@EALS
F&ct$! ?uevarra and !eHar are t#e president and >P of Polytec#nic /niversity
of t#e P#ilippines'P/P(" %n applyin for a bond bot# of t#em certified t#at t#ey
#ad no criminal or administrative cases aainst t#em even t#ou# t#ey #ad 04
cases pendin before t#e Sandianbayan" T#eir arument &as t#at t#ey
believed in ood fait# t#at t#e re9uirement referred to final conviction only, of
&#ic# t#ere &as none" T#is &as t#e source of a case aainst t#em by !ueva,
P/P,s !#ief <eal !ounsel, based on a resolution to c#are t#em by t#e !S!
for dis#onesty on ?uevarra,s part and ceHar &as c#ared &it# conduct
pre5udicial to t#e best interest of t#e service on a prima facie findin" MR and
motion to declare absence of prima facie case &as denied" !ueva moved for t#e
issuance of preventive suspensions and an omnibus motion to add t#e c#ares
of rave misconduct, falsification of official document, conduct pre5udicial to t#e
best interest of t#e service and bein notoriously undesirable"
T#e !S! denied t#e MR because it &as a nonresponsive pleadin, a)in to a
motion to dismiss, &#ic# &as pro#ibited under sec 02 of t#e /niform Rules on
+dministrative !ases in t#e !ivil Service" %t denied !ueava,s motion to add to
t#e c#ares but placed ?uevarra under preventive suspension for ninety '96(
days because as Officer in c#areCpresident #e &as in t#e position to unduly
influence possible &itnesses"
T#is &as follo&ed by a petition for certiorari and pro#ibition before t#e !+
9uestionin t#e 5urisdiction of t#e !S! over t#e administrative complaint aainst
t#em by !ueva" T#e !+ ranted t#is petition and set aside t#e !S! resolutions
of t#e !S!" %n so #oldin t#e !+ cited t#e administrative code of 09E4 'R+
E898( sayin t#at #eads of aencies and instrumentalities Ls#all #ave
5urisdiction to investiate and decide matters involvin disciplinary action aainst
officers and employees under t#eir 5urisdictionM besto&s upon t#e Board of
Reents t#e 5urisdiction to investiate and decide matters involvin disciplinary
action aainst respondents ?uevarra and !eHar" %t also said t#at t#e !S!
reconiHin t#e complaint &as improper because of failure to e$#aust all
administrative remedies by brinin t#e rievance to t#e Board of Reents"
I$$#! @#et#er t#e !S! #as oriinal concurrent 5urisdiction over administrative
cases fallin under t#e 5urisdiction of #eads of aencies" 'yes(
H-+! Bot# !S! and !ueva contend t#at because t#e !S! is t#e central
personnel aency of t#e overnment, it #as been e$pressly ranted by
E$ecutive Order 'E"O"( No" 898 t#e aut#ority to assume oriinal 5urisdiction over
complaints directly filed &it# it" T#e !S! e$plains t#at under t#e said la&, it #as
appellate 5urisdiction over all administrative disciplinary proceedins and oriinal
5urisdiction over complaints aainst overnment officials and employees filed
before it by private citiHens" +ccordinly, t#e !S! #as concurrent oriinal
5urisdiction, toet#er &it# t#e P/P Board of Reents, over t#e administrative
case aainst ?uevarra and !eHar and it can ta)e coniHance of a case filed
directly &it# it, despite t#e fact t#at t#e Board of Reents is t#e disciplinin
aut#ority of university employees"
Respondents ?uevarra and !eHar, on t#e ot#er #and, fully adopted t#e position
of t#e !+ in its 9uestioned decision and propounded t#e additional arument
t#at t#e passae of R"+ No" E898 ':i#er Education ModerniHation +ct of 0994(
#as effectively removed from t#e !S! t#e aut#ority to #ear and decide on cases
filed directly &it# it"
T#e !S!, as t#e central personnel aency of t#e overnment, #as t#e po&er to
appoint and discipline its officials and employees and to #ear and decide
administrative cases instituted by or brou#t before it directly or on appeal"
8
P/P became a c#artered state university under P"*" No" 0130" %t is a ?O!!
&it# an oriinal c#arter and its employees are covered by E"O" 898" T#e issue is
t#e disciplinary 5urisdiction of t#e !S!" Sec 34 of E"O" 898 says t#at La
complaint may be filed directly &it# t#e !ommission by a private citiHen aainst
a overnment official or employeeUM T#e !+ interpreted t#is to mean t#at it
e$cludes citiHen,s also under t#e disciplinin aut#ority involved, so !ueava
bein under t#e disciplinin aut#ority of P/P is not included" T#e Supreme
!ourt disarees"
T#e !ourt applied statutory construction to reac# a reasonable interpretation of
Lprivate citiHenM" %t used t#e plain meanin rule as &ell as t#e rule t#at literal
interpretations &#ic# result %n un5ust absurdities &ere to be re5ected" + literal
interpretation of E"O" 898 &ould mean t#at only private citiHens can file a
complaint directly &it# t#e !S!" ;or administrative cases instituted by
overnment employees aainst t#eir fello& public servants, t#e !S! &ould only
2 T#e civil service embraces all branc#es, subdivisions, instrumentalities, and aencies of
t#e ?overnment, includin
overnment7o&ned or controlled corporations &it# oriinal c#arters" Sec 8'0(, +rticle %B'b(
09E4 !onstitution
Att'. T. S&-.&+or : 11 : BDG ; SY 1<10
#ave appellate 5urisdiction over t#ose" Suc# a plain readin of t#e sub5ect
provision of E"O" 868 &ould effectively divest !S! of its oriinal 5urisdiction,
albeit s#ared, provided by la&" Moreover, it is clearly unreasonable as it &ould
be tantamount to disenfranc#isin overnment employees by removin from
t#em an alternative course of action aainst errin public officials"
T#ere is no coent reason to differentiate bet&een a complaint filed by a private
citiHen and one filed by a member of t#e civil service, especially in li#t of
Section 08'00(, !#apter 1, Subtitle +, Title %, Boo) > of t#e same E"O" No" 898
&#ic# confers upon t#e !S! t#e po&er to L#ear and decide administrative cases
instituted by or brou#t before it directly or on appealM &it#out any 9ualification"
Purisprudence is cited to support t#is"
T#e /niform Rules e$plicitly allo&s concurrent oriinal 5urisdiction over bet&een
t#e disciplinary aut#ority and t#e !S!" T#e !ourt said t#at t#ese rules do not
contradict t#e administrative code but provide a reasonable interpretation of t#e
same" But on t#e issue of certain provisions limitin 5urisdiction to t#ose &#ic#-
'0( are brou#t aainst personnel of t#e !S! central office, '8( are aainst t#ird
level officials &#o are not presidential appointees, '1( are aainst officials and
employees, but are not acted upon by t#e aencies t#emselves, or '3( ot#er&ise
re9uire direct or immediate action in t#e interest of 5ustice" T#e !ourt said t#at
t#e rules do not supplant t#e la& in rantin 5urisdiction and cited 5urisprudence
to t#at effect" T#e rules are merely directory in t#is matter"
+lso special la&s providin for t#e creation of disciplinary bodies or passae of
special la&s allo&in t#e same does not divest t#e !S! of 5urisdiction, even
t#ose in t#e academe" @#ere t#ey are filed directly to t#e !S! by a fello&
employee t#e !S! may ta)e 5urisdiction"
+lso t#ere is estoppel as t#e 5urisdiction of t#e !S! &as 9uestioned only after
t#e MR &as denied" R+ E898 and E"O" 898 do not conflict" T#e employees cited
t#e portion of R+ E898 pertainin to t#e po&ers of t#e Board Lto remove t#em
for cause in accordance &it# t#e re9uirements of due process of la&"M Simply
because a later statute relates to a similar sub5ect matter as t#at of an earlier
statute does not result in an implied repeal of t#e latter" T#ere are still no &ords
removin t#em from t#e !S!,s coverae" T#ere are no &ords rantin
e$clusivity"
%t is t#erefore apparent t#at despite t#e enactment of R"+" No" E898 ivin t#e
board of reents or board of
trustees of a state sc#ool t#e aut#ority to discipline its employees, t#e !S! still
retains 5urisdiction over t#e sc#ool and its employees and #as concurrent
oriinal 5urisdiction, toet#er &it# t#e board of reents of a state university, over
administrative cases aainst state university officials and employees"
;inally, &it# reard to t#e concern t#at t#e !S! maybe over&#elmed by t#e
increase in number of cases filed before it &#ic# &ould result from our rulin, it
be#ooves us to allay suc# &orries by #i#li#tin t&o important
facts" ;irstly, it s#ould be emp#asiHed t#at t#e !S! #as oriinal concurrent
5urisdiction s#ared &it# t#e overnin body in 9uestion, in t#is case, t#e Board of
Reents of P/P" T#is means t#at if t#e Board of Reents first ta)es coniHance
of t#e complaint, t#en it s#all e$ercise 5urisdiction to t#e e$clusion of t#e !S!"
T#us, not all administrative cases &ill fall directly under t#e !S!" Secondly,
Section 34, !#apter 4, Subtitle +, Title %, Boo) > of t#e +dministrative !ode
affords t#e !S! t#e option of &#et#er to decide t#e case or to deputiHe some
ot#er department, aency or official to conduct an investiation into t#e matter,
t#ereby considerably easin t#e burden placed upon t#e csc"
1) MALANA .. TA@@A
Doctrin! T#e nature of an action and t#e 5urisdiction of a tribunal are
determined by t#e material alleations of t#e complaint and t#e la& at t#e time
t#e action &as commenced" Purisdiction of t#e tribunal over t#e sub5ect matter
or nature of an action is conferred only by la& and not by t#e consent or &aiver
upon a court &#ic#, ot#er&ise, &ould #ave no 5urisdiction over t#e sub5ect
matter or nature of an action" <ac) of 5urisdiction of t#e court over an action or
t#e sub5ect matter of an action cannot be cured by t#e silence, ac9uiescence, or
even by e$press consent of t#e parties" %f t#e court #as no 5urisdiction over t#e
nature of an action, it may dismiss t#e same e$ mero motu or motu proprio"
MT! e$ercises e$clusive oriinal 5urisdiction over all civil actions &#ic# involve
title to or possession of real property &#ere t#e assessed value does not e$ceed
P86,666"66"
F&ct$! Petitioners !armen *anao Malana, et al", filed before t#e RT! of
Tuuearao !ity t#eir !omplaint for Reivindicacion, Vuietin of Title, and
*amaes aainst respondents Benino Tappa, et al" Petitioners alleed in t#eir
!omplaint t#at t#ey are t#e o&ners of a parcel of land covered by T!T situated
in Tuuearao !ity, !aayan" Petitioners in#erited t#e sub5ect property from
+nastacio *anao" *urin t#e lifetime of +nastacio, #e #ad allo&ed !onsuelo
Paui to build on and occupy t#e sout#ern portion of t#e sub5ect property"
+nastacio and !onsuelo areed t#at t#e latter &ould vacate t#e said land at any
time t#at +nastacio and #is #eirs mi#t need it"
Petitioners claimed t#at respondents, !onsuelo,s family members, continued to
occupy t#e sub5ect property even after #er deat#, already buildin t#eir
residences t#ereon usin permanent materials" Petitioners also learned t#at
respondents &ere claimin o&ners#ip over t#e sub5ect property" +verrin t#at
t#ey already needed it, petitioners demanded t#at respondents vacate t#e
same" Respondents, #o&ever, refused to #eed petitioners, demand"

Petitioners referred t#eir land dispute &it# respondents to t#e <upon
Taapamayapa of Baranay +nnafunan @est for conciliation" *urin t#e
conciliation proceedins, respondents asserted t#at t#ey o&ned t#e sub5ect
Att'. T. S&-.&+or : 1L : BDG ; SY 1<10
property and presented documents ostensibly supportin t#eir claim of
o&ners#ip"

+ccordin to petitioners, respondents, documents &ere #i#ly dubious, falsified,
and incapable of provin t#e latter,s claim of o&ners#ip over t#e sub5ect
property. nevert#eless, t#ey created a cloud upon petitioners, title to t#e
property" T#us, petitioners &ere compelled to file before t#e RT! a !omplaint to
remove suc# cloud from t#eir title"
Before respondents could file t#eir ans&er, t#e RT! issued an Order dismissin
petitioners, !omplaint on t#e round of lac) of 5urisdiction" T#e RT! referred to
Republic +ct No" 4290, amendin Batas Pambansa Bl" 089, ot#er&ise )no&n
as t#e Pudiciary ReoraniHation +ct of 09E6, &#ic# vests t#e RT! &it#
5urisdiction over real actions, &#ere t#e assessed value of t#e property involved
e$ceeds P86,666"66" %t found t#at t#e sub5ect property #ad a value of less t#an
P86,666"66. #ence, petitioners, action to recover t#e same &as outside t#e
5urisdiction of t#e RT!" T#e RT! li)e&ise denied t#e petitioners, Motion for
Reconsideration"

I$$#! @#et#er t#e RT! committed rave abuse of discretion in dismissin
petitioners, !omplaint for lac) of 5urisdiction" 'NO(
H-+! +n action for declaratory relief s#ould be filed by a person interested
under a deed, a &ill, a contract or ot#er &ritten instrument, and &#ose ri#ts are
affected by a statute, an e$ecutive order, a reulation or an ordinance" T#e relief
sou#t under t#is remedy includes t#e interpretation and determination of t#e
validity of t#e &ritten instrument and t#e 5udicial declaration of t#e parties, ri#ts
or duties t#ereunder"

Petitions for declaratory relief are overned by Rule 21 of t#e Rules of !ourt"
T#e RT! correctly made a distinction bet&een t#e first and t#e second
pararap#s of Section 0, Rule 21 of t#e Rules of !ourt"

T#e first pararap# of Section 0, Rule 21 of t#e Rules of !ourt, describes t#e
eneral circumstances in &#ic# a person may file a petition for declaratory relief"

+ petition for declaratory relief under t#e first pararap# of Section 0, Rule 21
may be brou#t before t#e appropriate RT!"
T#e second pararap# of Section 0, Rule 21 of t#e Rules of !ourt specifically
refers to '0( an action for t#e reformation of an instrument, reconiHed under
+rticles 0159 to 0129 of t#e !ivil !ode. '8( an action to 9uiet title, aut#oriHed by
+rticles 342 to 3E0 of t#e !ivil !ode. and '1( an action to consolidate o&ners#ip
re9uired by +rticle 0264 of t#e !ivil !ode in a sale &it# a ri#t to repurc#ase"
T#ese t#ree remedies are considered similar to declaratory relief because t#ey
also result in t#e ad5udication of t#e leal ri#ts of t#e litiants, often &it#out t#e
need of e$ecution to carry t#e 5udment into effect"
To determine &#ic# court #as 5urisdiction over t#e actions identified in t#e
second pararap# of Section 0, Rule 21 of t#e Rules of !ourt, said provision
must be read toet#er &it# t#ose of t#e Pudiciary ReoraniHation +ct of 09E6, as
amended"

%t is important to note t#at Section 0, Rule 21 of t#e Rules of !ourt does not
cateorically re9uire t#at an action to 9uiet title be filed before t#e RT!" %t
repeatedly uses t#e &ord LmayM" T#e use of t#e &ord LmayM in a statute denotes
t#at t#e provision is merely permissive and indicates a mere possibility, an
opportunity or an option"

%n contrast, t#e mandatory provision of t#e Pudiciary ReoraniHation +ct of 09E6,
as amended, uses t#e &ord Ls#allM and e$plicitly re9uires t#e MT! to e$ercise
e$clusive oriinal 5urisdiction over all civil actions &#ic# involve title to or
possession of real property &#ere t#e assessed value does not e$ceed
P86,666"66"
+s found by t#e RT!, t#e assessed value of t#e sub5ect property as stated in
Ta$ *eclaration No" 6873E1E2 is only P306"66. t#erefore, petitioners, !omplaint
involvin title to and possession of t#e said property is &it#in t#e e$clusive
oriinal 5urisdiction of t#e MT!, not t#e RT!"
;urt#ermore, an action for declaratory relief presupposes t#at t#ere #as been no
actual breac# of t#e instruments involved or of ri#ts arisin t#ereunder"
@#ere t#e la& or contract #as already been contravened prior to t#e filin of an
action for declaratory relief, t#e courts can no loner assume 5urisdiction over
t#e action" %n ot#er &ords, a court #as no more 5urisdiction over an action for
declaratory relief if its sub5ect #as already been infrined or transressed before
t#e institution of t#e action"
Since petitioners averred in t#e !omplaint t#at t#ey #ad already been deprived
of t#e possession of t#eir property, t#e proper remedy for t#em is t#e filin of an
accion publiciana or an accion reivindicatoria, not a case for declaratory relief"
+n accion publiciana is a suit for t#e recovery of possession, filed one year after
t#e occurrence of t#e cause of action or from t#e unla&ful &it##oldin of
possession of t#e realty" +n accion reivindicatoria is a suit t#at #as for its ob5ect
one,s recovery of possession over t#e real property as o&ner"

Petitioners, !omplaint contained sufficient alleations for an accion
reivindicatoria" Purisdiction over suc# an action &ould depend on t#e value of
t#e property involved" ?iven t#at t#e sub5ect property #erein is valued only at
P306"66, t#en t#e MT!, not t#e RT!, #as 5urisdiction over an action to recover
t#e same" T#e RT!, t#erefore, did not commit rave abuse of discretion in
dismissin, &it#out pre5udice, petitioners, !omplaint in !ivil !ase No" 2E2E for
lac) of 5urisdiction"

Att'. T. S&-.&+or : 1I : BDG ; SY 1<10
+s for t#e RT! dismissin petitioners, !omplaint motu proprio, t#e follo&in
pronouncements of t#e !ourt in $aresma v. "*ellana proves instructive-

%t is a$iomatic t#at t#e nature of an action and t#e 5urisdiction of a
tribunal are determined by t#e material alleations of t#e
complaint and t#e la& at t#e time t#e action &as
commenced" Purisdiction of t#e tribunal over t#e sub5ect matter or
nature of an action is conferred only by la& and not by t#e
consent or &aiver upon a court &#ic#, ot#er&ise, &ould #ave no
5urisdiction over t#e sub5ect matter or nature of an action" <ac) of
5urisdiction of t#e court over an action or t#e sub5ect matter of an
action cannot be cured by t#e silence, ac9uiescence, or even by
e$press consent of t#e parties" %f t#e court #as no 5urisdiction over
t#e nature of an action, it may dismiss t#e same e$ mero motu or
motu proprio" $ $ $"
Since t#e RT!, in dismissin petitioners, !omplaint, acted in complete accord
&it# la& and 5urisprudence, it cannot be said to #ave done so &it# rave abuse
of discretion amountin to lac) or e$cess of 5urisdiction" No suc# circumstances
e$ist #erein as to 5ustify t#e issuance of a &rit of certiorari"

%N >%E@ O; T:E ;ORE?O%N?, t#e instant Petition is *%SM%SSE*" T#e Orders
of t#e Reional Trial !ourt of Tuuearao !ity, Branc# 1, dismissin t#e
!omplaint in !ivil !ase No" 2E2E, &it#out pre5udice, are +;;%RME*" T#e
Reional Trial !ourt is ordered to REM+N* t#e records of t#is case to t#e
Municipal Trial !ourt or t#e court of proper 5urisdiction for proper disposition"
L) FAR EAST BAN? AND TRUST 4OM@ANY .. SHEMBERG
MAR?ETING 4OR@ORATION
Doctrin! T#e test for determinin &#et#er t#e sub5ect matter of an
action is incapable of pecuniary estimation is to ascertain t#e nature of
t#e principal action or remedy sou#t" %f t#e action is primarily for
recovery of a sum of money, t#e claim is considered capable of
pecuniary estimation" @#et#er t#e trial court #as 5urisdiction &ould
depend upon t#e amount of t#e claim" :o&ever, &#ere t#e basic issue
is somet#in ot#er t#an t#e ri#t to recover a sum of money, &#ere t#e
money claim is only incidental or a conse9uence of t#e principal relief
sou#t, t#e action is incapable of pecuniary estimation" %n t#e case of an
action 9uestionin t#e validity of a mortae, 5urisprudence #as #eld
t#at t#e action is incapable of pecuniary estimation
F&ct$! ;ar East Ban) W Trust !ompany ';ar East Ban)(, a domestic
ban)in corporation" S#ember Mar)etin !orporation, also duly
domestic corporations based in Pa)na7an, Mandaue !ity" S#ember et"
al failed to pay t#e loans upon its maturity #ence, ;ar East Ban) sou#t
to foreclose t#e mortaes e$tra5udicially"
S#ember et" al filed &it# t#e Mandaue !ity, RT!, a !omplain for
*eclaratory Relief, %n5unction, *amaes, +nnulment of Promissory
Notes, *ocuments, and !ontracts allein t#at prior to 099E, t#ey
obtained credit accommodations from ;ar East Ban)" T#e latter re9uired
t#em to sin Rstandard pre7printed ban) forms in fine print, suc# as
!redit <ine +reements '!<+(, Promissory Notes 'PN(, Real Estate
Mortaes 'REM(, !#attel Mortaes '!M(, Trust Receipts 'TR(, Surety
+reements 'PSS( and ot#er ban) forms and documents"R T#ey
complied &it# t#e aforementioned re9uirements but, it tuned out t#at t#e
ban),s employees filled t#e blan)s &it# Rfalse and inaccurate entries"R
:ence, t#ey deny and dispute t#e enuineness and due e$ecution of
t#e documents"
T#e Mandaue RT! issued a temporary restrainin order 'TRO( in favor
of S#ember et"al" T#ereafter, ;ar East Ban) filed its +ns&er li)e&ise, it
filed a Motion to *ismiss Based On +ffirmative *efenses allein t#at-
'0( t#e venue is improperly laid. '8( t#e trial court did not ac9uire
5urisdiction over t#e case for non7payment of proper doc)et fees. '1(
t#ere is non75oinder of indispensable parties. and '3( t#e trial court #as
no 5urisdiction to en5oin t#e foreclosure proceedins" :o&ever, t#e
Mandaue RT! denied t#e motion to dismiss"
;ar East Ban) t#en filed &it# t#e !+ contendin t#at t#e trial court acted
&it# rave abuse of discretion amountin to lac) or e$cess of 5urisdiction
but suc# &as dismissed" T#e MR &as also denied #ence, t#e petition"
;ar East Ban) is contended t#at in real actions, t#e assessed value of
t#e property or if t#ere is none, t#e estimated value t#ereof, must be
alleed in t#e complaint, and s#all serve as t#e basis for computin t#e
fees" No&#ere in t#e complaint did S#ember et" al" allee t#e
assessed values of t#eir realties" :ence, t#ere is no ade9uate basis for
Att'. T. S&-.&+or : 65 : BDG ; SY 1<10
computin t#e proper filin fees" %t necessarily follo&s t#at t#e fees paid
are deficient" T#e trial court, t#erefore, did not ac9uire 5urisdiction over
t#e case"
S#ember et" al", on t#e ot#er #and, averred t#at a perusal of t#e
complaint s#o&s t#at t#e suit primarily involves cancellation of
mortaes, an action incapable of pecuniary estimation" !onse9uently,
t#e ban),s contention t#at t#ere is a deficiency in t#e payment of doc)et
fees is &it#out merit"
I$$#- @#et#er or not t#e trial court #as 5urisdiction over t#e caseJ
4oro--&r' i$$#- @#et#er or not an action for cancellation of mortae
incapable of pecuniary estimationJ
H-+! + court ac9uires 5urisdiction over a case only upon t#e payment of
t#e prescribed fees"

T#e importance of filin fees cannot be ainsaid for
t#ese are intended to ta)e care of court e$penses in t#e #andlin of
cases in terms of costs of supplies, use of e9uipment, salaries and
frine benefits of personnel, and ot#ers, computed as to man7#ours
used in t#e #andlin of eac# case" :ence, t#e non7payment or
insufficient payment of doc)et fees can entail tremendous losses to t#e
overnment in eneral and to t#e 5udiciary in particular"
I$ &n &ction %or c&nc--&tion o% *ort(&( inc&"&/- o% "c#ni&r'
$ti*&tion3
/nder Section 09 '0( of BP 0E6, as amended by R+ 4290, Reional
Trial !ourts #ave sole, e$clusive, and oriinal 5urisdiction to #ear, try,
and decide Rall civil actions in &#ic# t#e sub5ect of t#e litiation is
incapable of pecuniary estimation"R
%n &ingsong v. -sa*ela &awmill, t#e !ourt laid t#e test for determinin
&#et#er t#e sub5ect matter of an action is incapable of pecuniary
estimation is to ascertain t#e nature of t#e principal action or remedy
sou#t" %f t#e action is primarily for recovery of a sum of money, t#e
claim is considered capable of pecuniary estimation" @#et#er t#e trial
court #as 5urisdiction &ould depend upon t#e amount of t#e claim"
Ho2.r, 2)r t) /&$ic i$$# i$ $o*t)in( ot)r t)&n t) ri()t
to rco.r & $#* o% *on', 2)r t) *on' c-&i* i$ on-'
inci+nt&- or & con$>#nc o% t) "rinci"&- r-i% $o#()t, t)
&ction i$ inc&"&/- o% "c#ni&r' $ti*&tion"
:ere, t#e primary reliefs prayed for by respondents in is t#e cancellation
of t#e real estate and c#attel mortaes for &ant of consideration" %n
(umayog v. 1umas,

t#e !ourt ruled t#at &#ere t#e issue involves t#e
validity of a mortae, t#e action is one incapable of pecuniary
estimation" Moreover, in t#e more recent case of 5ussell v. 9estil, t#e
!ourt, citin (umayog,

#eld t#at an action 9uestionin t#e validity of a
mortae is one incapable of pecuniary estimation" %n t#e case at bar,
;ar East Ban) #as not s#o&n ade9uate reasons for t#is !ourt to revisit
(umayog and 5ussell" :ence, petitioner,s contention can ot be
sustained" Since respondents paid t#e doc)et fees, as computed by t#e
cler) of court, conse9uently, t#e trial court ac9uired 5urisdiction over t#e
case"
I) S@S. MANILA ..S@S. MANMO
Doctrin! <ac) of 5urisdiction as a round for annulment of 5udment
refers to eit#er lac) of 5urisdiction over t#e person of t#e defendin party
or over t#e sub5ect matter of t#e claim" %n a petition for annulment of
5udment based on lac) of 5urisdiction, petitioner must s#o& not merely
an abuse of 5urisdictional discretion but an absolute -&c, of 5urisdiction"
<ac) of 5urisdiction means absence of or no 5urisdiction, t#at is, t#e court
s#ould not #ave ta)en coniHance of t#e petition because t#e la& does
not vest it &it# 5urisdiction over t#e sub5ect matter" Purisdiction over t#e
nature of t#e action or sub5ect matter is conferred by la&"
F&ct$! Respondent ManHo leased t&o parcels of land to Petitioners for
a period of ten years" T#ey also areed t#at t#e lessee 'Manila( s#all
#ave t#e option to buy t#e property &it#in t&o '8( years" T#e contract of
lease e$pired but Manila continued in possession of t#e property despite
demand to vacate t#e same and pay t#e rental arrearaes" Manila
claimed t#at no rental fee is due because t#ey alleedly became t#e
o&ner of t#e property at t#e time s#e communicated to ManHo t#eir
Att'. T. S&-.&+or : 61 : BDG ; SY 1<10
desire to e$ercise t#e option to buy t#e said property"
Resp" Sps" ManHo filed an =ct*nt $#it aainst Pet" Sps" Manila
before t#e MeT!" T#e MeT! rendered its decision in favor of ManHo"
Petitioner Manila appealed to t#e RT! &#ic# reversed t#e MeT!" T#e
RT! found t#at petitioners #ave in fact e$ercised t#eir option to buy t#e
leased property but t#e respondents refused to #onor t#e same" RT4
or+r+ t)&t M&nHo $)o#-+ Ec#t & ++ o% &/$o-#t $&- o.r
t) -&$+ -&n+.
ManHo filed an MR done but ot denied because it &as filed out of time
due to fault of t#eir previous counsel 't#e previous counsel &as ill("
ManHo filed a petition for annulment of t#e RT! decision in t#e !+
claimin t#at RT! Xs 5urisdiction is limited to t#e determination of &#o is
entitled to t#e p#ysical possession of real property and t#e only
5udment it can render in favor of t#e defendant is to recover #is costs"
!+ ruled in favor of ManHo" + petition for revie& &as filed by t#e
petitioners to t#e S!"
I$$#- @CN t#e RT! acted &it#in its 5urisdiction in orderin t#e Sale of
t#e property &#en decidin in its appellate 5urisdictionJ N!orollary to
t#is, @CN t#e !+,s annulment of 5udment is properO
H-+- yes" Petitioners assail t#e !+ in #oldin t#at t#e RT! decision is
void because it ranted a relief inconsistent &it# t#e nature of an
e5ectment suit and not even prayed for by t#e respondents in t#eir
ans&er" T#ey contend t#at &#atever maybe 9uestionable in t#e decision
is a round for assinment of errors on appeal I or in certain cases, as
round for a special civil action for certiorari under Rule 25 I and not as
round for its annulment"
On t#e ot#er #and, respondents assert t#at t#e !+, bein a #i#er
court, #as t#e po&er to adopt, reverse or modify t#e findins of t#e RT!
in t#is case" T#ey point out t#at t#e !+ in t#e e$ercise of its sound
discretion found t#e RT!,s findins unsupported by t#e evidence on
record &#ic# also indicated t#at t#e loss of ordinary remedies of appeal,
ne& trial and petition for revie& &as not due to t#e fault of t#e
respondents"
T#e !ourt said t#at in t#is case, t#e RT! acted in e$cess of its
5urisdiction in decidin t#e appeal of respondents &#en, instead of
simply dismissin t#e complaint and a&ardin any counterclaim for
costs due to t#e defendants 'petitioners(, it ordered t#e respondents7
lessors to e$ecute a deed of absolute sale in favor of t#e petitioners7
lessees, on t#e basis of its o&n interpretation of t#e !ontract of <ease"
T#is cannot be done in an e5ectment case &#ere t#e only issue for
resolution is &#o bet&een t#e parties is entitled to t#e p#ysical
possession of t#e property"
L&c, o% =#ri$+iction &$ & (ro#n+ %or &nn#-*nt o% =#+(*nt r%r$
to it)r -&c, o% =#ri$+iction o.r t) "r$on o% t) +%n+in( "&rt'
or o.r t) $#/=ct *&ttr o% t) c-&i*. In & "tition %or &nn#-*nt
o% =#+(*nt /&$+ on -&c, o% =#ri$+iction, "titionr *#$t $)o2 not
*r-' &n &/#$ o% =#ri$+iction&- +i$crtion /#t &n &/$o-#t -&c, o%
=#ri$+iction. L&c, o% =#ri$+iction *&n$ &/$nc o% or no
=#ri$+iction, t)&t i$, t) co#rt $)o#-+ not )&. t&,n co(niH&nc o%
t) "tition /c&#$ t) -&2 +o$ not .$t it 2it) =#ri$+iction o.r
t) $#/=ct *&ttr. C#ri$+iction o.r t) n&t#r o% t) &ction or
$#/=ct *&ttr i$ con%rr+ /' -&2.
Suc# erroneous rant of relief to t#e defendants on appeal, #o&ever, is
but an Erci$ o% =#ri$+iction /' t) RT4. C#ri$+iction i$ not t)
$&* &$ t) Erci$ o% =#ri$+iction" +s distinuis#ed from t#e
e$ercise of 5urisdiction, 5urisdiction is t#e aut#ority to decide a cause,
and not t#e decision rendered t#erein" T) (ro#n+ %or &nn#-*nt o%
t) +ci$ion i$ &/$nc o%, or no, =#ri$+ictionN t)&t i$, t) co#rt
$)o#-+ not )&. t&,n co(niH&nc o% t) "tition /c&#$ t) -&2
+o$ not .$t it 2it) =#ri$+iction o.r t) $#/=ct *&ttr"
T#us, 2)i- r$"on+nt$ &$$&i-+ t) contnt o% t) RT4 +ci$ion,
t)' %&i-+ to $)o2 t)&t t) RT4 +i+ not )&. t) &#t)orit' to
+ci+ t) c&$ on &""&-"
Att'. T. S&-.&+or : 66 : BDG ; SY 1<10
T#e +nnulment of 5udment &as set aside"
15) LHUILLIERv" BRITISH AIRWAYS
Doctrin! W)n t) tr&n$"ort o% & "r$on i$ +*+ to / &n
Ointrn&tion&- c&rri&(O 2it)in t) cont*"-&tion o% t) W&r$&2
4on.ntion, t) W&r$&2 4on.ntion &""-i$. Hnc, t) "ro.i$ion$
o% t) W&r$&2 4on.ntion (o.rn t) =#ri$+iction o.r t) $#/=ct
*&ttr o% t) &ction. Moro.r, 2)r t) &--(&tion$ o% tortio#$
con+#ct co**itt+ &(&in$t &n &ir-in "&$$n(r +#rin( t) co#r$
o% t) intrn&tion&- c&rri&(, it +o$ not /rin( t) c&$ o#t$i+ t)
&*/it o% t) W&r$&2 4on.ntion.
F&ct$- Edna *iao <#uillier filed a !omplaint for damaes aainst
Britis# +ir&ays 'B+( before t#e RT! of Ma)ati" S#e alleed t#at s#e too)
B+,s fli#t 53E from <ondon to Rome" Once on board, s#e alleedly
re9uested Pulian :alliday, one of t#e fli#t attendants, to assist #er in
placin #er #and7carried luae in t#e over#ead bin" :o&ever, Pulian
alleedly refused to #elp and assist #er, and even sarcastically
remar)ed t#at R%f % &ere to #elp all 166 passeners in t#is fli#t, % &ould
#ave a bro)en bac)QR S#e furt#er alleed t#at &#en t#e plane &as about
to land in Rome, anot#er fli#t attendant, Nic)olas Aerrian, sinled #er
out from amon all t#e passeners in t#e business class section to
lecture on plane safety" +lleedly, #e made #er appear to t#e ot#er
passeners to be inorant, uneducated, stupid, and in need of lecturin
on t#e safety rules and reulations of t#e plane" +ffronted, s#e assured
#umt#at s#e )ne& t#e plane,s safety reulations bein a fre9uent
traveler" T#ereupon, #e alleedly t#rust #is face a mere fe& centimeters
a&ay from t#at of t#e petitioner and menacinly told #er t#at R@e don,t
li)e your attitude"R/pon arrival in Rome, s#e complained to B+,s round
manaer and demanded an apoloy" :o&ever, t#e latter declared t#at
t#e fli#t ste&ards &ere Ronly doin t#eir 5ob"R T#us, s#e filed t#e
complaint for damaes"
T#ereafter, summons, toet#er &it# a copy of t#e complaint, &as served
on B+ t#rou# >ioleta Ec#evarria, ?eneral Manaer of Euro7P#ilippine
+irline Services, %nc" B+, by &ay of special appearance t#rou#
counsel, filed a Motion to *ismiss

on rounds of lac) of 5urisdiction over
t#e case and over t#e person" %t alleed t#at only t#e courts of <ondon
or Rome #ave 5urisdiction over t#e complaint for damaes pursuant to
t#e @arsa& !onvention, T#us, since a( B+ is domiciled in <ondon. b( its
principal place of business is in <ondon. c( Edna bou#t #er tic)et in
%taly and d( Rome is Edna,s place of destination, t#en it follo&s t#at t#e
complaint s#ould only be filed in t#e proper courts of <ondon or Rome"
<i)e&ise, it &as alleed t#at t#e case must be dismissed for lac) of
5urisdiction over t#e person of B+ because t#e summons &as
erroneously served on Euro7P#ilippine +irline Services, %nc" &#ic# is not
its resident aent in t#e P#ilippines"
alleed t#at upon verification &it# t#e Securities and E$c#ane
!ommission, s#e found out t#at t#e resident aent of respondent in t#e
P#ilippines is +lonHo V" +nc#eta" Subse9uently, on September 9, 8665,
petitioner filed a Motion to Resolve Pendin %ncident and Opposition to
Motion to *ismiss"
T#e RT! dismissed t#e case and denied Edna,s MR" :ence, t#is
petition"
Edna arues t#at #er cause of action arose not from t#e contract of
carriae, but from t#e tortious conduct committed by airline personnel of
respondent in violation of t#e provisions of t#e !ivil !ode on :uman
Relations" Since #er cause of action &as not predicated on t#e contract
of carriae, petitioner asserts t#at s#e #as t#e option to pursue t#is case
in t#is 5urisdiction pursuant to P#ilippine la&s"
%n contrast, B+ maintains t#at Edna,s claim for damaes fell &it#in t#e
ambit of +rticle 8E'0( of t#e @arsa& !onvention" +s suc#, t#e same can
only be filed before t#e courts of <ondon or Rome"
I$$#! @#et#er or not P#ilippine courts #ave 5urisdiction over a tortious
conduct committed aainst a ;ilipino !itiHen and Resident by airline
personnel of a forein carrierJ
H-+! T#e petition is &it#out merit" T#e @arsa& !onvention #as t#e
Att'. T. S&-.&+or : 6< : BDG ; SY 1<10
force and effect of la& in t#is country" %t is settled t#at t#e @arsa&
!onvention #as t#e force and effect of la& in t#is country" %n T#e
!onvention is a treaty commitment voluntarily assumed by t#e
P#ilippine overnment and, as suc#, #as t#e force and effect of la& in
t#is country" T#e @arsa& !onvention applies because t#e air travel,
&#ere t#e alleed tortious conduct occurred, &as bet&een t#e /nited
Aindom and %taly, &#ic# are bot# sinatories to t#e @arsa&
!onvention"
@#en t#e place of departure and t#e place of destination in a contract of
carriae are situated &it#in t#e territories of t&o :i# !ontractin
Parties, said carriae is deemed an Rinternational carriaeR"
1
T#e :i#
!ontractin Parties referred to #erein &ere t#e sinatories to t#e
@arsa& !onvention and t#ose &#ic# subse9uently ad#ered to it" %n t#e
case at benc#, Edna,s place of departure &as <ondon, &#ile #er place
of destination &as Rome, Bot# t#e /nited Aindom
0
and %taly sined
and ratified t#e @arsa& !onvention" +s suc#, t#e transport of t#e
petitioner is deemed to be an Rinternational carriaeR &it#in t#e
contemplation of t#e @arsa& !onvention"
3 +rticle 0 of t#e @arsa& !onvention provides-
0" T#is !onvention applies to all international carriae of persons, luae or
oods performed by aircraft for re&ard" %t applies e9ually to ratuitous carriae
by aircraft performed by an air transport underta)in"
8" ;or t#e purposes of t#is !onvention t#e e$pression Rinternational carriaeR
means any carriae in &#ic#, accordin to t#e contract made by t#e parties, t#e
place of departure and t#e place of destination, &#et#er or not t#ere be a brea)
in t#e carriae or a trans#ipment, are situated eit#er &it#in t#e territories of t&o
:i# !ontractin Parties, or &it#in t#e territory of a sinle :i# !ontractin
Party, if t#ere is an areed stoppin place &it#in a territory sub5ect to t#e
sovereinty, suHerainty, mandate or aut#ority of anot#er Po&er, even t#ou#
t#at Po&er is not a party to t#is !onvention" + carriae &it#out suc# an areed
stoppin place bet&een territories sub5ect to t#e sovereinty, suHerainty,
mandate or aut#ority of t#e same :i# !ontractin Party is not deemed to be
international for t#e purposes of t#is !onvention" 'Emp#asis supplied(
Sinc t) W&r$&2 4on.ntion &""-i$ in t) in$t&nt c&$, t)n t)
=#ri$+iction o.r t) $#/=ct *&ttr o% t) &ction i$ (o.rn+ /' t)
"ro.i$ion$ o% t) W&r$&2 4on.ntion.
!onse9uently, /nder +rticle 8E'0( of t#e @arsa& !onvention, t#e
plaintiff may brin t#e action for damaes before- 0" t#e court &#ere t#e
carrier is domiciled. 8" t#e court &#ere t#e carrier #as its principal place
of business. 1" t#e court &#ere t#e carrier #as an establis#ment by
&#ic# t#e contract #as been made. or 3" t#e court of t#e place of
destination"
%n t#is case, it is not disputed t#at respondent is a Britis# corporation
domiciled in t#e /nited Aindom &it# <ondon as its principal place of
business" :ence, under t#e first and second 5urisdictional rules, Edna
may brin #er case before t#e courts of <ondon in t#e /nited Aindom"
%n t#e passener tic)et and baae c#ec) presented by bot# t#e Edna
and B+, it appears t#at t#e tic)et &as issued in Rome" !onse9uently,
under t#e t#ird 5urisdictional rule, t#e petitioner #as t#e option to brin
#er case before t#e courts of Rome" ;inally, bot# t#e petitioner and
respondent aver t#at t#e place of destination is Rome, &#ic# is properly
desinated iven t#e routin presented in t#e said passener tic)et and
baae c#ec)" +ccordinly, petitioner may brin #er action before t#e
courts of Rome" @e t#us find t#at t#e court does not #ave 5urisdiction
over t#e case filed by Edna"
T#e court furt#er #eld t#at +rticle 8E'0( of t#e @arsa& !onvention is
5urisdictional in c#aracter" T#us, in ot#er &ords, &#ere t#e @arsa&
!onvention overns t#e matter, 5urisdiction ta)es on a dual concept"
Purisdiction in t#e international sense must be establis#ed in
accordance &it# +rticle 8E'0( of t#e @arsa& !onvention, follo&in
&#ic# t#e 5urisdiction of a particular court must be establis#ed pursuant
to t#e applicable domestic la&" Only after t#e 9uestion of &#ic# court
#as 5urisdiction is determined &ill t#e issue of venue be ta)en up" T#is,
second 9uestion s#all be overned by t#e la& of t#e court to &#ic# t#e
case is submitted"
On t) contntion, t)&t @)i-i""in co#rt$ )&. =#ri$+iction o.r t)
Att'. T. S&-.&+or : 60 : BDG ; SY 1<10
tortio#$ con+#ct o% t) &ir-in "r$onn-, t) co#rt )-+ t)&t
tortio#$ con+#ct &$ (ro#n+ %or t) "titionrA$ co*"-&int i$ 2it)in
t) "#r.i2 o% t) W&r$&2 4on.ntion.
T#e court #eld t#at a cause of action based on tort did not brin t#e
case outside t#e sp#ere of t#e @arsa& !onvention" T#e court cited t#e
case !arey v" /nited +irlines &#ere t#e /nited States !ourt of +ppeals
'9t# !ircuit( #eld t#at t#e RpassenerFs action aainst t#e airline carrier
arisin from alleed confrontational incident bet&een passener and
fli#t attendant on international fli#t &as overned e$clusively by t#e
@arsa& !onvention, even t#ou# t#e incident alleedly involved
intentional misconduct by t#e fli#t attendant"M %t also cited t#e case of
Bloom v" +las)a +irlines, &#ere t#e same court cited above, #eld t#at
t#e R@arsa& !onvention overns actions arisin from international air
travel and provides t#e e$clusive remedy for conduct &#ic# falls &it#in
its provisions"R %t furt#er #eld t#at t#e said !onvention Rcreated no
e$ception for an in5ury suffered as a result of intentional conductR &#ic#
in t#at case involved a claim for intentional infliction of emotional
distress" It i$ t)#$ $tt-+ t)&t &--(&tion$ o% tortio#$ con+#ct
co**itt+ &(&in$t &n &ir-in "&$$n(r +#rin( t) co#r$ o% t)
intrn&tion&- c&rri&( +o not /rin( t) c&$ o#t$i+ t) &*/it o%
t) W&r$&2 4on.ntion.
4AUSE OF A4TION
1) MINDANAO TERMINAL .. @HOENIF ASSURAN4E
Doctrin! + plaintiff #as a cause of action aainst t#e defendant based on
9uasi7delict even t#ou# t#ere is no pre7e$istin relations#ip or contract
bet&een t#e parties"
F&ct$! *el Monte P#ils" !ontracted Mindanao Terminal, a stevedorin company,
to load and sto& a s#ipment of bananas and pineapples into t#e vessel MC>
Mistrau doc)ed at t#e port of *avao !ity and bound for %nc#eon, Sout# Aorea"
T#e oods &ere insured &it# P#oeni$ +ssurance" /pon disc#are of t#e caro
in Aorea, several cartons of t#e bananas and pineapples &ere damaed and no
loner #ad any commercial value" *el Monte filed an insurance claim and &as
paid by P#oeni$ +ssurance" T#e latter sued Mindanao Terminal for damaes
before t#e RT! of *avao !ity" T#e RT! dismissed t#e complaint for lac) of
cause of action aainst Mindanao Terminal because its services &ere
contracted by *el Monte and not by t#e insurer" T#e !+ reversed t#e rulin and
#eld Mindanao Terminal to be liable for damaes"
I$$#! @#et#er P#oeni$ #as a cause of action aainst Mindanao Terminal"
H-+! =es" T#e complaint filed by P#oeni$ aainst Mindanao Terminal, from
&#ic# t#e present case #as arisen, states a cause of action" T#e present action
is based on 9uasi7delict, arisin from t#e nelient and careless loadin and
sto&in of t#e caroes belonin to *el Monte" Even assumin t#at P#oeni$
#as only been subroated in t#e ri#ts of *el Monte, &#o is not a party to t#e
contract of service bet&een Mindanao Terminal and *el Monte, still t#e
insurance carriers may #ave a cause of action in li#t of t#e !ourt,s consistent
rulin t#at t#e act t#at brea)s t#e contract may be also a tort" %n fine, a liability
for tort may arise even under a contract, &#ere tort is t#at &#ic# breac#es t#e
contract" %n t#e present case, P#oeni$ is not suin for damaes for in5uries
arisin from t#e breac# of t#e contract of service but from t#e alleed nelient
manner by &#ic# Mindanao Terminal #andled t#e caroes belonin to *el
Monte Produce" *espite t#e absence of contractual relations#ip bet&een *el
Monte Produce and Mindanao Terminal, t#e alleation of nelience on t#e part
of t#e defendant s#ould be sufficient to establis# a cause of action arisin from
9uasi7delict"
6) MA4ASLANG V MAMORA
F&ct$! On Marc# 06, 0999, t#e respondents filed a complaint for unla&ful
detainer in t#e MT!!, allein t#at Rt#e petitioner sold to respondents a
residential land located in Saban, *anao !ityR and t#at Rt#e petitioner
re9uested to be allo&ed to live in t#e #ouseR &it# a Rpromise to vacate as soon
as s#e &ould be able to find a ne& residence"R T#ey furt#er alleed t#at despite
t#eir demand after a year, t#e petitioner failed or refused to vacate t#e premises"
Att'. T. S&-.&+or : 68 : BDG ; SY 1<10
*espite t#e due service of t#e summons and copy of t#e complaint, t#e
petitioner did not file #er ans&er" T#e MT!! declared #er in default upon t#e
respondents, motion to declare #er in default, and proceeded to receive t#e
respondents, oral testimony and documentary evidence" T#ereafter, on
September 01, 0999, t#e MT!! rendered 5udment- in favor of plaintiff Damora
and aainst defendant Macaslan orderin t#e latter to vacate t#e premises
RT!- dismissed for failure to state a cause of action. !+- reversed decision and
reinstated MT!!s decision
I$$#! @#et#er or not in an action for unla&ful detainer, &#ere t#ere &as no
prior demand to vacate and comply &it# t#e conditions of t#e lease made, a
valid cause of action e$istsJ
H-+! S! concurs &it# !+
+ complaint sufficiently allees a cause of action for unla&ful detainer if it states
t#e follo&in-
a" %nitially, t#e possession of t#e property by t#e defendant &as by
contract &it# or by tolerance of t#e plaintiff.
b" Eventually, suc# possession became illeal upon notice by t#e plaintiff
to t#e defendant about t#e termination of t#e latter,s ri#t of
possession.
c" T#ereafter, t#e defendant remained in possession of t#e property and
deprived t#e plaintiff of its en5oyment. and
d" @it#in one year from t#e ma)in of t#e last demand to vacate t#e
property on t#e defendant, t#e plaintiff instituted t#e complaint for
e5ectment"
%n resolvin &#et#er t#e complaint states a cause of action or not, only t#e facts
alleed in t#e complaint are considered" T#e test is &#et#er t#e court can
render a valid 5udment on t#e complaint based on t#e facts alleed and t#e
prayer as)ed for" Only ultimate facts, not leal conclusions or evidentiary facts,
are considered for purposes of applyin t#e test"
Based on its alleations, t#e complaint sufficiently stated a cause of action for
unla&ful detainer" ;irstly, it averred t#at t#e petitioner possessed t#e property by
t#e mere tolerance of t#e respondents" Secondly, t#e respondents demanded
t#at t#e petitioner vacate t#e property, t#ereby renderin #er possession illeal"
T#irdly, s#e remained in possession of t#e property despite t#e demand to
vacate" +nd, fourt#ly, t#e respondents instituted t#e complaint on Marc# 06,
0999,&#ic# &as &ell &it#in a year after t#e demand to vacate &as made around
September of 099E or later"
=et, even as &e rule t#at t#e respondents, complaint stated a cause of action,
&e must find and #old t#at bot# t#e RT! and t#e !+ erroneously appreciated
t#e real issue to be about t#e complaint,s failure to state a cause of action" %t
certainly &as not so, but t#e respondents, lac) of cause of action" T#eir
erroneous appreciation e$pectedly prevented t#e correct resolution of t#e
action"
F&i-#r to $t&t & c&#$ o% &ction &n+ -&c, o% c&#$ o% &ction &r r&--'
+i%%rnt %ro* &c) ot)r. On t) on )&n+, %&i-#r to $t&t & c&#$ o%
&ction r%r$ to t) in$#%%icinc' o% t) "-&+in(, &n+ i$ & (ro#n+ %or
+i$*i$$&- #n+r R#- 19 o% t) R#-$ o% 4o#rt. On t) ot)r )&n+, -&c, o%
c&#$ &ction r%r$ to & $it#&tion 2)r t) .i+nc +o$ not "ro. t)
c&#$ o% &ction &--(+ in t) "-&+in(" Pustice Realado, a reconiHed
commentator on remedial la&, #as e$plained t#e distinction-
$$$ @#at is contemplated, t#erefore, is a failure to state a cause of action &#ic#
is provided in Sec" 0'( of Rule 02" T#is is a matter of insufficiency of t#e
pleadin" Sec" 5 of Rule 06, &#ic# &as also included as t#e last mode for raisin
t#e issue to t#e court, refers to t#e situation &#ere t#e evidence does not prove
a cause of action" T#is is, t#erefore, a matter of insufficiency of evidence"
;ailure to state a cause of action is different from failure to prove a cause of
action" T#e remedy in t#e first is to move for dismissal of t#e pleadin, &#ile t#e
remedy in t#e second is to demur to t#e evidence, #ence reference to Sec" 5 of
Rule 06 #as been eliminated in t#is section" T#e procedure &ould conse9uently
be to re9uire t#e pleadin to state a cause of action, by timely ob5ection to its
deficiency. or, at t#e trial, to file a demurrer to evidence, if suc# motion is
&arranted"
+ complaint states a cause of action if it avers t#e e$istence of t#e t#ree
essential elements of a cause of action, namely-
'a( T#e leal ri#t of t#e plaintiff.
'b( T#e correlative obliation of t#e defendant. and
'c( T#e act or omission of t#e defendant in violation of said leal ri#t"
%f t#e alleations of t#e complaint do not aver t#e concurrence of t#ese
elements, t#e complaint becomes vulnerable to a motion to dismiss on t#e
round of failure to state a cause of action" Evidently, it is not t#e lac) or
absence of a cause of action t#at is a round for t#e dismissal of t#e complaint
but t#e fact t#at t#e complaint states no cause of action" ;ailure to state a cause
of action may be raised at t#e earliest staes of an action t#rou# a motion to
dismiss, but lac) of cause of action may be raised at any time after t#e
9uestions of fact #ave been resolved on t#e basis of t#e stipulations,
admissions, or evidence presented"
:avin found t#at neit#er E$#ibit ! nor E$#ibit E &as a proper demand to
vacate, considerin t#at E$#ibit ! 't#e respondents, letter dated ;ebruary 00,
099E( demanded t#e payment and E$#ibit E 't#eir letter dated Panuary 80,
0999( demanded t#e payment, t#e RT! concluded t#at t#e demand alleed in
t#e complaint did not constitute a demand to pay rent and to vacate t#e
premises necessary in an action for unla&ful detainer" %t &as t#is conclusion t#at
caused t#e RT! to confuse t#e defect as failure of t#e complaint to state a
cause of action for unla&ful detainer"
Att'. T. S&-.&+or : 69 : BDG ; SY 1<10
+lso, t#e demand not bein to pay rent and to vacate did not render t#e cause
of action deficient" Based on t#e complaint, t#e petitioner,s possession &as
alleedly based on t#e respondents, tolerance, not on any contract bet&een
t#em" :ence, t#edemand to vacate sufficed"
@:ERE;ORE, &e rant t#e petition for revie& on certiorari. set aside t#e
decision promulated on Puly 1, 8668 by t#e !ourt of +ppeals. and dismiss t#e
complaint for unla&ful detainer for lac) of a cause of action"
<) TURNER, ET AL. V. LORENMO SHI@@ING 4OR@ORATION (G.R. No.
18101I, No.*/r 60, 6515)
Doctrin$!
+ cause of action is t#e act or omission by &#ic# a party violates a ri#t
of anot#er"

T#e essential elements of a cause of action are- 'a( t#e
e$istence of a leal ri#t in favor of t#e plaintiff. 'b( a correlative leal
duty of t#e defendant to respect suc# ri#t. and 'c( an act or omission
by suc# defendant in violation of t#e ri#t of t#e plaintiff &it# a resultin
in5ury or damae to t#e plaintiff for &#ic# t#e latter may maintain an
action for t#e recovery of relief from t#e defendant" +lt#ou# t#e first
t&o elements may e$ist, a cause of action arises only upon t#e
occurrence of t#e last element, ivin t#e plaintiff t#e ri#t to maintain
an action in court for recovery of damaes or ot#er appropriate relief"
Sub5ect to certain 9ualification, and e$cept as ot#er&ise provided by
la&, &n &ction co**nc+ /%or t) c&#$ o% &ction )&$ &ccr#+
i$ "r*&t#r-' /ro#()t &n+ $)o#-+ / +i$*i$$+" T#e fact t#at t#e
cause of action accrues after t#e action is commenced and &#ile t#e
case is pendin is of no moment" %t is a rule of la& to &#ic# t#ere is,
per#aps no e$ception, eit#er in la& or in e9uity, t#at to recover at all
t#ere must be some cause of action at t#e commencement of t#e suit"
+n action prematurely brou#t is a roundless suit" Un-$$ t)
"-&inti%% )&$ & .&-i+ &n+ $#/$i$tin( c&#$ o% &ction &t t) ti* )i$
&ction i$ co**nc+, t) +%ct c&nnot / c#r+ or r*+i+ /'
t) &c>#i$ition or &ccr#&- o% on 2)i- t) &ction i$ "n+in(, and a
supplemental complaint or an amendment settin up suc# after7
accrued cause of action is not permissible"
G#ic, F&ct$! T#is case concerns t#e ri#t of dissentin stoc)#olders to demand
payment of t#e value of t#eir s#are#oldins"
%n t#e stoc)#olders, suit to recover t#e value of t#eir s#are#oldins from t#e
corporation, t#e Reional Trial !ourt 'RT!( up#eld t#e dissentin stoc)#olders,
#erein petitioners, and ordered t#e corporation, #erein respondent, to pay"
E$ecution &as partially carried out aainst t#e respondent" On t#e respondent,s
petition for certiorari, #o&ever, t#e !ourt of +ppeals '!+( corrected t#e RT! and
dismissed t#e petitioners, suit on t#e round t#at t#eir cause of action for
collection #ad not yet accrued due to t#e lac) of unrestricted retained earnins
in t#e boo)s of t#e respondent"
T#us, t#e petitioners are no& before t#e !ourt to c#allene t#e !+,s decision"
F&ct$! T#e petitioners #eld 0,606,666 s#ares of stoc) of t#e respondent, a
domestic corporation enaed primarily in caro s#ippin activities" %n Pune
0999, t#e respondent decided to amend its articles of incorporation to remove
t#e stoc)#olders, pre7emptive ri#ts to ne&ly issued s#ares of stoc)" ;eelin
t#at t#e corporate move &ould be pre5udicial to t#eir interest as stoc)#olders,
t#e petitioners voted aainst t#e amendment and demanded payment of t#eir
s#ares at t#e rate of P8"842Cs#are based on t#e boo) value of t#e s#ares, or a
total of P8,89E,426"66"
T#e respondent found t#e fair value of t#e s#ares demanded by t#e petitioners
unacceptable" %t insisted t#at t#e mar)et value on t#e date before t#e action to
remove t#e pre7emptive ri#t &as ta)en s#ould be t#e value, or P6"30Cs#are 'or
a total of P303,066"66(, considerin t#at its s#ares &ere listed in t#e P#ilippine
Stoc) E$c#ane, and t#at t#e payment could be made only if t#e respondent
#ad unrestricted retained earnins in its boo)s to cover t#e value of t#e s#ares,
&#ic# &as not t#e case"
T#e disareement on t#e valuation of t#e s#ares led t#e parties to constitute an
appraisal committee" T#e appraisal committee reported its valuation of
P8"53Cs#are, for an areate value of P8,525,366"66 for t#e petitioners"
Subse9uently, t#e petitioners demanded payment based on t#e valuation of t#e
appraisal committee"
T#e respondent refused t#e petitioners, demand, e$plainin t#at pursuant to t#e
!orporation !ode, t#e dissentin stoc)#olders e$ercisin t#eir appraisal ri#ts
could be paid only &#en t#e corporation #ad unrestricted retained earnins to
cover t#e fair value of t#e s#ares, but t#at it #ad no retained earnins at t#e time
of t#e petitioners, demand"
/pon t#e respondent,s refusal to pay, t#e petitioners sued t#e respondent for
collection and damaes in t#e RT! in Ma)ati !ity on Panuary 88, 6551" T#e
RT! Pude issued an order rantin t#e petitioners, motion for partial summary
5udment" Subse9uently, t#e RT! issued a &rit of e$ecution"
T#e evidence submitted by plaintiffs s#o&s t#at in its 9uarterly financial
Att'. T. S&-.&+or : 61 : BDG ; SY 1<10
statement it submitted to t#e Securities and E$c#ane !ommission, t#e
defendant #as retained earnins of P00,945,396 as of Marc# 80, 6556" T#is is
not disputed by t#e defendant" %ts only arument aainst payin is t#at t#ere
must be unrestricted retained earnin at t#e time t#e demand for payment is
made" *efendant appealed to t#e !+"
T#e !+ promulated its assailed decision #oldin t#at t#e Turners, ri#t of
action arose only &#en defendant #ad already retained earnins in t#e amount
of P00,945,396"66 on Marc# 80, 8668. suc# ri#t of action &as ine$istent on
Panuary 88, 8660 &#en t#ey filed t#e !omplaint"
I$$#! @#et#er or not t#ere &as a cause of action &#en t#e complaint &as filed
'NO I cause of action &as premature(
H-+!
T#at t#e respondent #ad indisputably no unrestricted retained earnins in its
boo)s at t#e time t#e petitioners commenced !ivil !ase No" 6076E2 on Panuary
88, 8660 proved t#at t#e respondent,s leal obliation to pay t#e value of t#e
petitioners, s#ares did not yet arise" T#us, t#e !+ did not err in #oldin t#at t#e
petitioners #ad no cause of action, and in rulin t#at t#e RT! did not validly
render t#e partial summary 5udment"
Section 0, Rule 8, of t#e Rules of !ourt re9uires t#at every ordinary civil action
must be based on a cause of action" +ccordinly, !ivil !ase No" 6076E2 &as
dismissible from t#e beinnin for bein &it#out any cause of action"
Even t#e fact t#at t#e respondent already #ad unrestricted retained earnins
more t#an sufficient to cover t#e petitioners, claims on Pune 82, 8668 '&#en t#ey
filed t#eir motion for partial summary 5udment( did not rectify t#e absence of
t#e cause of action at t#e time of t#e commencement of !ivil !ase No" 6076E2"
T#e motion for partial summary 5udment, bein a mere application for relief
ot#er t#an by a pleadin, &as not t#e same as t#e complaint in !ivil !ase No"
6076E2" T#ereby, t#e petitioners did not meet t#e re9uirement of t#e Rules of
!ourt t#at a cause of action must e$ist at t#e commencement of an action,
&#ic# is Rcommenced by t#e filin of t#e oriinal complaint in court"R
@:ERE;ORE, t#e petition for revie& on certiorari is denied for lac) of merit"
0) 4HUA .. METROBAN?
Doctrin! ;orum s#oppin is committed by filin multiple cases based
on t#e same cause of action, alt#ou# &it# different prayers" Rules of
!ourt proscribe t#e splittin of a sinle cause of action" ;orum
s#oppin occurs alt#ou# t#e actions seem to be different, &#en it can
be seen t#at t#ere is a splittin of a cause of action" + cause of action is
understood to be t#e delict or &ronful act or omission committed by t#e
defendant in violation of t#e primary ri#ts of t#e plaintiff" %t is true t#at a
sinle act or omission can violate various ri#ts at t#e same time, as
&#en t#e act constitutes 5uridically a violation of several separate and
distinct leal obliations" :o&ever, &#ere t#ere is only one delict or
&ron, t#ere is but a sinle cause of action reardless of t#e number of
ri#ts t#at may #ave been violated belonin to one person"
F&ct$! !#ua is t#e president of ;iliden, a domestic corporation,
enaed in t#e realty business" Metropolitan Ban) and Trust !o"
'Metroban)( is a domestic corporation and a duly licensed ban)in
institution" Sometime in 09EE, !#ua and ;iliden 'petitioners( obtained
from Metroban) a loan of P3M, &#ic# &as secured by a real estate
mortae 'REM( on parcels of land covered by T!Ts reistered in
!#ua,s name 'sub5ect properties("

Since t#e value of t#e collateral &as
more t#an t#e loan, petitioners &ere iven an open credit line for future
loans" Subse9uently, petitioners obtained ot#er loans from Metroban),
and t#e real estate mortaes &ere repeatedly amended in accordance
&it# t#e increase in petitioners, liabilities" :avin failed to fully pay t#eir
obliations, petitioners entered into a *ebt Settlement +reement &it#
Metroban) &#ereby t#e loan obliations of t#e former &ere restructured"
T#e debt consisted of a total principal amount of P49"25M plus unpaid
interest of P4"96M and penalty c#ares of P558,4E3"92" +mortiHation
payments &ere to be made in accordance &it# t#e sc#edule attac#ed to
t#e areement" %n a letter dated t#e la&yers of Metroban) demanded
t#at petitioners fully pay and settle t#eir liabilities, includin interest and
penalties, in t#e total amount of P061M as &ell as t#e stipulated
attorney,s fees, &it#in t#ree days from receipt of said letter"
@#en petitioners still failed to pay t#eir loans, Metroban) sou#t to
e$tra75udicially foreclose t#e REM constituted on t#e sub5ect properties"
/pon a verified Petition for ;oreclosure filed by Metroban) +tty" !elestra
issued a Notice of Sale, &#erein t#e mortae debt &as set at PEEM
e$cludin unpaid interest and penalties, attorney,s fees, leal fees, and
ot#er e$penses for t#e foreclosure and sale" T#e auction sale &as
sc#eduled on 10 May 8660" On 3 May 8660, petitioners received a copy
of t#e Notice of Sale"
Att'. T. S&-.&+or : 6L : BDG ; SY 1<10
Subse9uently, !#ua, in #is personal capacity and actin on be#alf of
;iliden, filed before t#e RT!, a !omplaint for %n5unction &it# Prayer for
%ssuance of TRO, Preliminary %n5unction and *amaes, aainst +tty"
!elestra et"al" '!ivil !ase 0(" /pon t#e motion of petitioners, RT!
issued a TRO en5oinin Metroban) and +tty" !elestra from conductin
t#e auction sale of t#e mortaed properties" +fter t#e e$piration of t#e
TRO, and no in5unction #avin been issued by RT!7Branc# 854, +tty"
!elestra reset t#e auction sale" On t#e resc#eduled date of t#e auction
sale, RT!7Branc# 854 issued an Order directin t#at t#e said sale be
reset ane&" T#e Order &as served on E November 8660, on +tty"
!elestra,s dau#ter, +rlene !elestra, at a coffee s#op o&ned by t#e
former,s ot#er dau#ter, ?race !elestra +uirre" T#e auction sale,
#o&ever, proceeded on E November 8660, and a !ertificate of Sale &as
accordinly issued to Metroban) as t#e #i#est bidder of t#e foreclosed
properties"
Petitioners filed &it# RT!7Branc# 854 a Motion to +dmit +mended
!omplaint in !ivil !ase 0" T#e +mended >erified !omplaint,

attac#ed to
t#e said Motion, impleaded as additional defendant t#e incumbent
Reister of *eeds of ParaTa9ue !ity" Petitioners alleed t#at t#e
!ertificate of Sale &as a falsified document since t#ere &as no actual
sale t#at too) place on E November 8660" +nd, even if an auction sale
&as conducted, t#e !ertificate of Sale &ould still be void because t#e
auction sale &as done in disobedience to a la&ful order of RT!7Branc#
854" Petitioners additionally prayed in t#eir +mended !omplaint for t#e
a&ard of damaes iven t#e abuse of po&er of Metroban) in t#e
preparation, e$ecution, and implementation of t#e *ebt Settlement
+reement &it# petitioners. t#e bad fait# of Metroban) in offerin t#e
sub5ect properties at a price muc# lo&er t#an its assessed fair mar)et
value. and t#e ross violation by Metroban) and +tty" !elestra of t#e
in5unction" Petitioners also sou#t, in t#eir +mended !omplaint, t#e
issuance of a TRO or a &rit of preliminary in5unction to en5oin
respondent +tty" !elestra and all ot#er persons from proceedin &it# t#e
foreclosure sale, on t#e premise t#at no auction sale &as actually #eld
on E November 8660"
%n an Order, RT!7Branc# 854 denied petitioners, application for
in5unction on t#e round t#at t#e sale of t#e foreclosed properties
rendered t#e same moot and academic" T#e auction sale, &#ic# &as
conducted by Metroban) and +tty" !elestra, after t#e e$piration of t#e
TRO, and &it#out )no&lede of t#e Order dated E November 8660 of
RT!7Branc# 854, &as considered as proper and valid" Petitioners filed a
MR of t#e 2 Marc# 8668 Order of RT!7Branc# 854" @#en RT!7Branc#
854 failed to ta)e any action on said Motion, petitioners filed &it# t#e !+
a Petition for !ertiorari" %n a *ecision, t#e !+ reversed t#e 2 Marc#
8668 Order of RT!7Branc# 854 and remanded t#e case for furt#er
proceedins" T#e Supreme !ourt dismissed t#e appeal of respondents
&it# finality" T#us, RT!7Branc# 854 set t#e #earin for t#e presentation
of evidence by Metroban) for t#e application for preliminary in5unction"
Petitioner also sou#t t#e in#ibition of +ctin E$ecutive Pude Rolando
:o& of RT!7Branc# 854, &#o presided over !ivil !ase" T#eir motion
&as ranted and t#e case &as re7raffled to RT!7Branc# 85E"
Petitioners filed &it# Branc# 095 of t#e RT! ParaTa9ue 'RT!7Branc#
095( a >erified !omplaint for *amaes aainst Metroban), +tty"
!elestra, and 1 Metroban) la&yers, namely, +tty" >iray, +tty" Miranda
and +tty" Maynio '!ivil !ase 8(" Petitioners sou#t in t#eir !omplaint
t#e a&ard of actual, moral, and e$emplary damaes aainst t#e
respondents for ma)in it appear t#at an auction sale of t#e sub5ect
properties too) place, as a result of &#ic#, t#e prospective buyers of t#e
said properties lost t#eir interest and !#ua &as prevented from realiHin
a profit of P46M from t#e intended sale"
Petitioners filed &it# RT!7Branc# 095 a Motion to !onsolidated, see)in
t#e consolidation of !ivil !ase 8, t#e action for damaes pendin before
said court, &it# !ivil !ase 0, t#e in5unction case t#at &as bein #eard
before RT!7Branc# 85E, based on t#e follo&in rounds- +" T#e above7
captioned case is a complaint for damaes as a result of t#e N#erein
respondents,O conspiracy to ma)e it appear as if t#ere &as an auction
sale conducted on November E, 8660 &#en in fact t#ere &as none" T#e
properties sub5ect of t#e said auction sale are t#e same properties
sub5ect of !ivil !ase No" 0". B" Since t#e sub5ect matter of bot# cases
are t#e same properties and t#e parties of bot# cases are almost t#e
same, and bot# cases #ave t#e same central issue of &#et#er t#ere
&as an auction sale, t#en necessarily, bot# cases s#ould be
consolidated"
Respondents filed &it# RT!7Branc# 095 an Opposition to Motion to
!onsolidate &it# Prayer for Sanctions, prayin for t#e dismissal of t#e
!omplaint for *amaes in !ivil !ase No" 8, on t#e round of forum
s#oppin" %n an Order, RT!7Branc# 095 ranted t#e Motion to
!onsolidate, and ordered t#at !ivil !ase 8 be transferred to RT!7
Branc# 85E, &#ic# &as #earin !ivil !ase 0" +fter t#e t&o cases &ere
consolidated, respondents filed t&o motions before RT!7Branc# 85E-
Att'. T. S&-.&+or : 6I : BDG ; SY 1<10
'0( MR of t#e Order RT!7Branc# 095, &#ic# ranted t#e Motion to
!onsolidate of petitioners. and '8( Manifestation and Motion raisin t#e
round of forum s#oppin, amon t#e affirmative defenses of
respondents"

RT!7Branc# 85E issued an Order, rantin t#e first Motion
of respondents, t#us, dismissin !ivil !ase 8 on t#e round of forum
s#oppin, and conse9uently, renderin t#e second Motion of
respondents moot" RT!7Branc# 85E declared t#at t#e facts or claims
submitted by petitioners, t#e ri#ts asserted, and t#e principal parties in
t#e t&o cases &ere t#e same" RT!7Branc# 85E #eld in its Order t#at-
since t#ere is identity of parties and t#e ri#ts asserted, t#e alleations
of t#e defendant are found meritorious and &it# leal basis, t#e motion
is ?R+NTE* and t#is case is *%SM%SSE* due to forum s#oppin" +s
reards t#e second motion, t#e same #as already been mooted by t#e
dismissal of t#is case" T#e MR filed by t#e defendants &#ereby t#is
case is *%SM%SSE* due to forum s#oppin and t#e Manifestation and
Motion li)e&ise filed by t#e defendants #as already been MOOTE* by
t#e said dismissal"
;rom t#e foreoin Order of RT!7Branc# 85E, petitioners filed a Petition
for Revie& on !ertiorari &it# t#e !+" %n a *ecision t#e !+ affirmed
Order of RT!7Branc# 85E" T#e appellate court observed t#at alt#ou#
t#e defendants in t#e t&o cases &ere not identical, t#ey represented a
community of interest" %t also declared t#at t#e cause of action of t#e
t&o cases, upon &#ic# t#e recovery of damaes &as based, &as t#e
same, i"e", t#e feined auction sale, suc# t#at t#e nullification of t#e
foreclosure of t#e sub5ect properties, &#ic# petitioners sou#t in !ivil
!ase 0, &ould render proper t#e a&ard for damaes, claimed by
petitioners in !ivil !ase 8" T#us, 5udment in eit#er case &ould result in
res 5udicata" !+ additionally noted t#at petitioners admitted in t#eir
Motion for !onsolidation t#at !ivil !ase 0 and !ivil !ase 8 involved t#e
same parties, central issue, and sub5ect properties"

%n its *ecision,

t#e
appellate court decreed- T#e dismissal by t#e RT!7Br" 85E, !ivil !ase
8, on t#e round of forum s#oppin s#ould be up#eld as it is supported
by la& and 5urisprudence" Petitioners filed a MR, &#ic# t#e !+ denied"
I$$#! @ON petitioners t#e successive filin of civil cases amounts to
forum s#oppin" '=ES(
H-+! Section 5 or t#e RO! provides !ertification aainst forum
s#oppin" ;ailure to comply &it# t#ose re9uirements s#all not be
curable by mere amendment of t#e complaint or ot#er initiatory pleadin
but s#all be cause for t#e dismissal of t#e case &it#out pre5udice, unless
ot#er&ise provided, upon motion and after #earin" T#e submission of a
false certification or non7compliance &it# any of t#e underta)ins t#erein
s#all constitute indirect contempt of court, &it#out pre5udice to t#e
correspondin administrative and criminal actions" %f t#e acts of t#e
party or #is counsel clearly constitutes &illful and deliberate forum
s#oppin, t#e same s#all be round for summary dismissal &it#
pre5udice and s#all constitute direct contempt, as &ell as a cause for
administrative sanctions" ;orum s#oppin e$ists &#en a party
repeatedly avails #imself of several 5udicial remedies in different courts,
simultaneously or successively, all substantially founded on t#e same
transactions and t#e same essential facts and circumstances, and all
raisin substantially t#e same issues eit#er pendin in or already
resolved adversely by some ot#er court" /ltimately, &#at is truly
important in determinin &#et#er forum s#oppin e$ists or not is t#e
ve$ation caused t#e courts and party7litiant by a party &#o as)s
different courts to rule on t#e same or related causes andCor to rant t#e
same or substantially t#e same reliefs, in t#e process creatin t#e
possibility of conflictin decisions bein rendered by t#e different fora
upon t#e same issue" ;orum s#oppin can be committed in t#ree &ays-
'0( filin multiple cases based on t#e same cause of action and &it# t#e
same prayer, t#e previous case not #avin been resolved yet '&#ere t#e
round for dismissal is litis pendentia(. '8( filin multiple cases based on
t#e same cause of action and t#e same prayer, t#e previous case
#avin been finally resolved '&#ere t#e round for dismissal is res
5udicata(. and '1( filin multiple cases based on t#e same cause of
action, but &it# different prayers 'splittin of causes of action, &#ere t#e
round for dismissal is also eit#er litis pendentia or res 5udicata("
%n t#e present case, t#ere is no dispute t#at petitioners failed to state in
t#e !ertificate of Non7;orum S#oppin, attac#ed to t#eir >erified
!omplaint in !ivil !ase t#e e$istence of !ivil !ase in Parana9ue
pendin before RT!7Branc# 85E" Nevert#eless, petitioners insist t#at
t#ey are not uilty of forum s#oppin, since '0( t#e t&o cases do not
#ave t#e same ultimate ob5ective I !ivil !ase 0 see)s t#e annulment of
t#e public auction and certificate of sale issued t#erein, &#ile !ivil !ase
8 prays for t#e a&ard of actual and compensatory damaes for
respondents, tortuous act of ma)in it appear t#at an auction sale
actually too) place on E November 8660. and '8( t#e 5udment in !ivil
!ase 0, on t#e annulment of t#e foreclosure sale, &ould not affect t#e
outcome of !ivil !ase 8, on t#e entitlement of petitioners to damaes"
T#e !ourt, #o&ever, finds t#ese aruments refuted by t#e alleations
made by petitioners t#emselves in t#eir !omplaints in bot# cases"
Att'. T. S&-.&+or : <5 : BDG ; SY 1<10
:o&ever, Petitioners committed forum s#oppin by filin multiple cases
based on t#e same cause of action, alt#ou# &it# different prayers"
Sections 1 and 3, Rule 8 of t#e Rules of !ourt proscribe t#e splittin of a
sinle cause of action- Section 1" + party may not institute more t#an
one suit for a sinle cause of action" Section 3" Splittin a sinle cause
of action. effect of"Y%f t&o or more suits are instituted on t#e basis of t#e
same cause of action, t#e filin of one or a 5udment upon t#e merits in
any one is available as a round for t#e dismissal of t#e ot#ers"
;orum s#oppin occurs alt#ou# t#e actions seem to be different, &#en
it can be seen t#at t#ere is a splittin of a cause of action" + cause of
action is understood to be t#e delict or &ronful act or omission
committed by t#e defendant in violation of t#e primary ri#ts of t#e
plaintiff" %t is true t#at a sinle act or omission can violate various ri#ts
at t#e same time, as &#en t#e act constitutes 5uridically a violation of
several separate and distinct leal obliations" :o&ever, &#ere t#ere is
only one delict or &ron, t#ere is but a sinle cause of action reardless
of t#e number of ri#ts t#at may #ave been violated belonin to one
person"
Petitioners &ould li)e to ma)e it appear t#at !ivil !ase 0 &as solely
concerned &it# t#e nullification of t#e auction sale and certification of
sale, &#ile !ivil !ase 8 &as a totally separate claim for damaes" =et, a
revie& of t#e records reveals t#at petitioners also included an e$plicit
claim for damaes in t#eir +mended !omplaint in !ivil !ase 0"
Petitioners averred in t#eir +mended !omplaint in !ivil !ase 0 t#at t#e
assessed fair mar)et value of t#e sub5ect properties &as P042,004,666"
T#e !ourt observes t#at t#e damaes bein claimed by petitioners in
t#eir !omplaint in !ivil !ase 8 &ere also occasioned by t#e supposedly
fictitious E November 8660 foreclosure sale"
T#ere is no 9uestion t#at t#e claims of petitioners for damaes in !ivil
!ase 0 and !ivil !ase 8 are premised on t#e same cause of action, i"e",
t#e purportedly &ronful conduct of respondents in connection &it# t#e
foreclosure sale of t#e sub5ect properties"
+t first lance, said claims for damaes may appear different" %n !ivil
!ase 0, t#e damaes purportedly arose from t#e bad fait# of
respondents in offerin t#e sub5ect properties at t#e auction sale at a
price muc# lo&er t#an t#e assessed fair mar)et value of t#e said
properties, said to be P042,004,666" On t#e ot#er #and, t#e damaes in
!ivil !ase 8, alleedly resulted from t#e bac)in out of prospective
buyers, &#o #ad initially offered to buy t#e sub5ect properties for Rnot
less t#an P045M because respondents made it appear t#at t#e said
properties &ere already sold at t#e auction sale" =et, it is &ort#y to note
t#at petitioners 9uoted closely similar values for t#e sub5ect properties in
bot# cases, aainst &#ic# t#ey measured t#e damaes t#ey supposedly
suffered" Evidently, t#is is due to t#e fact t#at petitioners actually based
t#e said values on t#e sinle appraisal report of t#e P#ilippine +ppraisal
!ompany on t#e sub5ect properties" Even t#ou# petitioners did not
specify in t#eir +mended !omplaint in !ivil !ase 0 t#e e$act amount of
damaes t#ey &ere see)in to recover, leavin t#e same to t#e
determination of t#e trial court, and petitioners e$pressly prayed t#at
t#ey be a&arded damaes of not less t#an P46M in t#eir !omplaint in
!ivil !ase 8 petitioners cannot deny t#at all t#eir claims for damaes
arose from &#at t#ey averred &as a fictitious public auction sale of t#e
sub5ect properties"1avvphi 1
Petitioners, contention t#at t#e outcome of !ivil !ase 0 &ill not
determine t#at of !ivil !ase 8 does not 5ustify t#e filin of separate
cases" Even if it &ere assumed t#at t#e t&o cases contain t&o separate
remedies t#at are bot# available to petitioners, t#ese t&o remedies t#at
arose from one &ronful act cannot be pursued in t&o different cases"
T#e rule aainst splittin a cause of action is intended to prevent
repeated litiation bet&een t#e same parties in reard to t#e same
sub5ect of controversy, to protect t#e defendant from unnecessary
ve$ation. and to avoid t#e costs and e$penses incident to numerous
suits" %t comes from t#e old ma$im nemo debet bis ve$ari, pro una et
eadem causa 'no man s#all be t&ice ve$ed for one and t#e same
cause(" Moreover, petitioners admitted in t#eir Motion to !onsolidated
before RT!7Branc# 095 t#at bot# cases s#ared t#e same parties, t#e
same central issue, and t#e same sub5ect property"
%f t#e forum s#oppin is not considered &illful and deliberate, t#e
subse9uent case s#all be dismissed &it#out pre5udice, on t#e round of
eit#er litis pendentia or res 5udicata" :o&ever, if t#e forum s#oppin is
&illful and deliberate, bot# 'or all, if t#ere are more t#an t&o( actions
s#all be dismissed &it# pre5udice" %n t#is case, petitioners did not
deliberately file !ivil !ase 8 for t#e purpose of see)in a favorable
decision in anot#er forum" Ot#er&ise, t#ey &ould not #ave moved for
t#e consolidation of bot# cases" T#us, only !ivil !ase 8 is dismissed
and t#e #earin of !ivil !ase 0 before RT!7Branc# 85E &ill be
continued"
Att'. T. S&-.&+or : <1 : BDG ; SY 1<10
T#e Petition is *EN%E*" T#e *ecision and Resolution of t#e !+
affirmin t#e Order of Branc# 85E of t#e Reional Trial !ourt of
ParaTa9ue !ity, dismissin !ivil !ase, is +;;%RME*, &it#out pre5udice
to t#e proceedins in anot#er !ivil !ase" !osts aainst petitioners"
8) 4HU V. 4UNANAN
Doctrin! Splittin a sinle cause of action is t#e act of dividin a sinle
or indivisible cause of action into several parts or claims and institutin
t&o or more actions upon t#em" + sinle cause of action or entire claim
or demand cannot be split up or divided in order to be made t#e sub5ect
of t&o or more actions" %f t&o or more suits are instituted on t#e basis of
t#e same cause of action, t#e filin of one or a 5udment upon t#e merits
in any one is available as a round for t#e dismissal of ot#ers"
F&ct$! T#e !#us e$ecuted a deed of sale &it# assumption of mortae
coverin 5 parcels of lot in favor of t#e !unanans" T#e deed stipulated
t#at t#e o&ners#ip over t#e lots &ould only be transferred to t#e
!unanans upon complete payment" @it#out t#e )no&lede of t#e
!#us, t#e !unanans &ere able to transfer t#e title of t#e lots to t#eir
names, pursuant to a special po&er of attorney issued by t#e !#us in
favor of t#e !unanans"
T#us, t#e !#us sued for t#e recovery of t#e unpaid balance, &#ic# &as
later on amended to see) t#e annulment of t#e deed of sale &it#
assumption of mortae" Since some of t#e lots &ere already
transferred to t#ird parties, t#e parties entered into a compromise
areement statin t#at t#e !unanans &ill transfer to t#e !#us 56K of
t#eir s#are in all parcels of land for and in consideration of t#e full
settlement of t#e case" T#e compromise areement &as approved by
t#e court"
T#ereafter, t#e !#us sued t#e !unanans for t#e cancellation of t#e
T!Ts of t&o lots 'out of t#e 5 lots involved(" T#e !unanans moved to
dismiss on rounds of res 5udicata" T#e lo&er court denied t#e motion"
T#e !+ reversed"
I$$#! @CN t#e !#us may proceed aainst t#e !unanans in t#e
subse9uent action"
H-+! NO. T#e !#us &ere uilty of splittin t#eir cause of action" T#e
compromise areement #as already put to end t#e litiation amon t#e
5 lots involved" T#e ri#ts and obliations of t#e parties concernin t#e
five lots &ere defined and overned by t#e deed of sale &it# assumption
of mortae, t#e only contract bet&een t#em" T#at contract &as sinle
and indivisible" T#e !#us could not properly proceed aainst t#e
!unanans in t#e subse9uent case because t#ere can only be one action
&#ere t#e contract is entire, and t#e breac# is total, t#us, t#e !#us must
recover all t#eir claims and damaes in one case" T#ey cannot be
permitted to split up a sinle cause of action and ma)e t#at sinle cause
of action t#e basis of several suits"
@it# t#at, res 5udicata is present barrin t#e subse9uent action aainst
t#e !unanans" 'Re9uisites for res 5udicata- identity of parties, sub5ect
matter and cause of action("
9) NM Rot)$c)i-+ P Son$ .. L"&nto 4on$o-i+&t+ Minin( 4o*"&n'
F&ct$! <epanto !onsolidated Minin '<EP+NTO( filed &it# t#e RT! a complaint
aainst Rot#sc#ild W Sons, +ustralia 'ROT:S!:%<*( see)in to void a loan and
#edin contract bet&een t#em for bein contrary to +rt 860E, N!!" Rot#sc#ild
'petitioner( filed a Motion to *ismiss on t#e rounds t#at 'a( court #as no
5urisdiction over petitioner due to a defective and improper service of summons,
'b( failure to state a cause of action, 'c( action is barred by estoppel, 'd( doctrine
of unclean #ands"
T! denied t#e MT*" +ccordin to t#e T!, t#ere &as a proper service of
summons t#rou# t#e *;+ since Rot#sc#ild did not apply for a license to do
business in t#e P#il nor filed &it# t#e SE! a @ritten Po&er of +tty", desinatin
some person on &#om summons may be served" T#ere &as also a cause of
action" Ot#er alleations &ere brus#ed aside as matters, &#ic# could be best
discussed durin trial" Rot#sc#ild filed an MR" *enied aain" !+ affirmed"
I$$#! @CN an alleation of absence of cause of action may be raised in a
motion to dismiss I NO"
Att'. T. S&-.&+or : <6 : BDG ; SY 1<10
H-+! Petition *EN%E*" +s correctly ruled by t#e T! and t#e !+, t#e alleed
absence of a cause of action 'as opposed to t#e failure to state a cause of
action(, t#e alleed estoppel on t#e part of petitioner, and t#e arument t#at
respondent is in pari delicto in t#e e$ecution of t#e c#allened contracts, are not
rounds in a MT* as enumerated in Sec 0, Rule 02, RO!" " Rat#er, suc#
defenses raise evidentiary issues closely related to t#e validity andCor e$istence
of respondent,s alleed cause of action and s#ould t#erefore be t#res#ed out
durin t#e trial"
+ cause of action is t#e act or omission by &#ic# a party violates a ri#t of
anot#er" %ts elements are t#e follo&in- '0( a ri#t e$istin in favor of t#e plaintiff,
'8( a duty on t#e part of t#e defendant to respect t#e plaintiffFs ri#t, and '1( an
act or omission of t#e defendant in violation of suc# ri#t" T#e complaint must
s#o& t#at t#e claim for relief does not e$ist and not only t#at t#e claim &as
defectively stated or is ambiuous, indefinite or uncertain"
:ere, t#e case contains all t#ree elements of a cause of action" i.e. it allees
t#at- '0( plaintiff #as t#e ri#t to as) for t#e declaration of nullity of t#e :edin.
'8( defendant #as t#e correspondin obliation not to enforce t#e :edin
!ontracts because t#ey are in t#e nature of &aerin or amblin areements
and t#erefore t#e transactions implementin t#ose contracts are null and void
under P#ilippine la&s. and '1( defendant inored t#e advice and intends to
enforce t#e :edin !ontracts by demandin financial payments due t#erefrom"
T#e rule is t#at in a Motion to *ismiss, a defendant #ypot#etically admits t#e
trut# of t#e material alleations of t#e ultimate facts contained in t#e plaintiffFs
complaint" :o&ever, t#is principle of #ypot#etical admission admits of
e$ceptions" & *otion to +i$*i$$ +o$ not &+*it t#e &--(&tion$ o% -(&-
conc-#$ion$, nor *r conc-#$ion$ o% -&2. !ourts may consider ot#er facts
&it#in t#e rane of 5udicial notice as &ell as relevant la&s and 5urisprudence
&#ic# t#e courts are bound to ta)e into account, and t)' &r &-$o %&ir-'
ntit-+ to E&*in rcor+$B+oc#*nt$ +#-' incor"or&t+ into t)
co*"-&int /' t) "-&+r )i*$-% in r#-in( on t) +*#rrr to t)
co*"-&int"
@#et#er suc# an areement is void is a mere alleation of a conclusion of la&,
&#ic# t#erefore cannot be #ypot#etically admitted" Vuite properly, t#e relevant
portions of t#e contracts sou#t to be nullified, as &ell as a copy of t#e contract
itself, are incorporated in t#e !omplaint" T#e determination of &#et#er or not t#e
!omplaint stated a cause of action &ould t#erefore involve an in9uiry into
&#et#er or not t#e assailed contracts are void under P#ilippine la&s" +n issue
t#at Lre9uires t#e contravention of t#e alleations of t#e complaint, as &ell as
t#e full ventilation, in effect, of t#e main merits of t#e case, s#ould not be &it#in
t#e province of a mere Motion to *ismiss"M T#e T! t#erefore, correctly denied
t#e MT* on t#is round"
Att'. T. S&-.&+or : << : BDG ; SY 1<10
@ARTIES
1) GO . DISTIN4TION @RO@ERTIES
Doctrin- +n indispensable party is defined as one &#o #as suc# an interest in
t#e controversy or sub5ect matter t#at a final ad5udication cannot be made, in #is
absence, &it#out in5urin or affectin t#at interest" T#e absence of an
indispensable party renders all subse9uent actions of t#e court null and void
F&ct$! Petitioners P#ilip ?o, Pacifico <im and +ndre& <im are individual
o&ners of condo units in P#oeni$ :ei#ts Pasi" Respondent *istinction
Properties *evelopment and !onstruction, %nc" ()')C-) is t#e real estate
developer of P#oeni$ :ei#ts"
Petitioner Pacifico <im, one of t#e incorporators and t#e t#en president of
*P*!%, e$ecuted a 4aster )eed and )eclaration of 5estrictions(4))5) of
P#oeni$ :ei#ts !ondominium, &#ic# &as filed &it# t#e Reistry of
*eeds" T#ereafter, P#oeni$ :ei#ts !ondominium !orporation ('HCC) &as
formally oraniHed and incorporated" Sometime in 8666, *P*!% turned over to
P:!! t#e o&ners#ip and possession of t#e condo units, e$cept for t#e t&o
saleable commercial units- !ondo !ert of Title '!!T( No" 80616 and !!T PT7
84192C !70127%%"

Mean&#ile, Petitioner Pacifico <im, as president of *P*!%, filed an "pplication
for "lteration of 'lan pertainin to t#e construction of 88 storae units in t#e
spaces ad5unct to t#e par)in area of t#e buildin" T#e application, #o&ever,
&as disapproved as t#e proposed alteration &ould obstruct li#t and ventilation"

P:!! approved a settlement offer from *P*!% for t#e set7off of t#e latter,s
association dues arrears &it# t#e assinment of title over !!T Nos" 80616 and
PT784192C!70127%% and t#eir conversion into common areas" T#us, !!T Nos"
PT731366 and PT731199 &ere issued by t#e R* of Pasi !ity in favor of P:!!
in lieu of t#e old titles" T#e said settlement bet&een t#e t&o corporations
li)e&ise included t#e reversion of t#e 88 storae spaces into common
areas" @it# t#e conformity of P:!!, *P*!%,s application for alteration
'conversion of unconstructed 88 storae units and units ?;37+ and B+S from
saleable to common areas( &as ranted by t#e :ousin and <and /se
Reulatory Board (H$:5().

Petitioners as condo unit o&ners filed a complaint before t#e :</RB aainst
*P*!% for unsound business practices and violation of t#e M**R"
:</RB decision- in favor of Petitioners" %t #eld as invalid t#e areement entered
into bet&een *P*!% and P:!!, as to t#e alteration or conversion of t#e sub5ect
units into common areas, &#ic# it previously approved, for t#e reason t#at it &as
not approved by t#e ma5ority of t#e members of P:!!" T#e :</RB furt#er
stated t#at t#e case &as not a derivative suit but one &#ic# involved contracts of
sale of t#e respective units bet&een t#e complainants and *P*!%, #ence, &it#in
its 5urisdiction pursuant to Section 0, P* No" 954'T#e Subdivision and
!ondominium Buyers, Protective *ecree("

*P*!% appealed to !+" !+ ruled in favor of *P*!%" :</RB #ad no 5urisdiction
over t#e complaint filed by petitioners as t#e controversy did not fall &it#in t#e
scope of t#e administrative aency,s aut#ority" !+ #eld t#at 5urisdiction over
P:!!, an indispensable party, &as neit#er ac9uired nor &aived by
estoppel" !itin Carandang v. Heirs of )e 3u/man, it #eld t#at t#e action
s#ould be dismissed because t#e absence of P:!!, an indispensable party,
rendered all subse9uent actuations of t#e court void, for &ant of aut#ority to act,
not only as to t#e absent parties but even as to t#ose present"

I$$#$!
0( @ON :</RB #as 5urisdiction over t#e complaint
8( @ON P:!! is an indispensable party
H-+!
0( No" To determine 5urisdiction, t#e averments in t#e complaint and
t#e c#aracter of t#e relief sou#t are t#e ones to be consulted" Once vested by
t#e alleations in t#e complaint, 5urisdiction also remains vested irrespective of
&#et#er or not t#e plaintiff is entitled to recover upon all or some of t#e claims
asserted t#erein"
T#e :</RB is iven &ide latitude in c#aracteriHin or cateoriHin acts &#ic#
may constitute unsound business practice or breac# of contractual obliations in
t#e real estate trade" T#is rant of e$pansive 5urisdiction to t#e :</RB does
not mean, #o&ever, t#at all cases involvin subdivision lots or condominium
units automatically fall under its 5urisdiction"
%n t#is case, t#e complaint filed by petitioners alleed causes of action t#at
apparently are not coniHable by t#e :</RB considerin t#e nature of t#e
action and t#e reliefs sou#t" + perusal of t#e complaint discloses t#at
petitioners are actually see)in to nullify and invalidate t#e duly constituted acts
of P:!!7 entered into by P:!! &it# *P*!% and its Board Resolution &#ic#
aut#oriHed t#e acceptance of t#e proposed offsettinCsettlement of *P*" T#ere
is no doubt t#at t#at t#e controversy is intra7corporate, for bein bet&een a
condo corporation and its member unit o&ners" T#us, it is RT! &#ic# #as
5urisdiction"
8( =es" +n indispensable party is defined as one &#o #as suc# an interest in t#e
controversy or sub5ect matter t#at a final ad5udication cannot be made, in #is
absence, &it#out in5urin or affectin t#at interest" T#e absence of an
indispensable party renders all subse9uent actions of t#e court null and void for
&ant of aut#ority to act, not only as to t#e absent parties but even to t#ose
present" T#e purpose of t#e rules on 5oinder of indispensable parties is a
complete determination of all issues not only bet&een t#e parties t#emselves,
but also as reards ot#er persons &#o may be affected by t#e 5udment" +
Att'. T. S&-.&+or : <0 : BDG ; SY 1<10
decision valid on its face cannot attain real finality &#ere t#ere is &ant of
indispensable parties"
;rom all indications, P:!! is an indispensable party and s#ould #ave been
impleaded, eit#er as a plaintiff or as a defendant, in t#e complaint filed before
t#e :</RB as it &ould be directly and adversely affected by any determination
t#erein" T#e causes of action, or t#e acts complained of, &ere t#e acts of P:!!
as a corporate body" Note t#at in t#e 5udment rendered by t#e :</RB, t#e
dispositive portion in particular, *P*!% &as ordered '0( to pay 99E,096"46,
plus interests and surc#ares, as condominium dues in arrears and turnover t#e
administration office to 'HCC. and '8( to refund to 'HCC 0,844,566"66,
representin t#e cost of t#e deep &ell, &it# interests and surc#ares" +lso, t#e
:</RB declared as illeal t#e areement reardin t#e conversion of t#e 88
storae units and /nits ?;37+ and B+S, to &#ic# areement P:!! &as a
party" @it#out P:!! as a party, t#ere can be no final ad5udication of t#e
:</RB,s 5udment" T#e !+ &as, t#us, correct in orderin t#e dismissal of t#e
case for failure to implead an indispensable party"
7S! affirmed !+ decision" :</RB #as no 5urisdiction. its decision is null and
void"
6) H&cin+& L#i$it& : YAO
<) Mtro"o-it&n B&n, (Mtro/&n,) .. R#r&- B&n, o% Gron& (RGB)
Doctrin! !onsiderin t#at t#e case #as been pendin before t#e courts for
around 86 years already and iven t#at a party '!entral Ban)( is not a
necessary party as t#ere #as already been a leal subroation, suc# party need
not be impleaded"
F&ct$! RB? is a rural ban)in corporation oraniHed under P#ilippine la&s and
located in ?erona, Tarlac" !entral Ban) and RB? entered into an areement
providin t#at RB? s#all facilitate t#e loan applications of farmers7borro&ers
under !entral Ban)7%nternational Ban) for Reconstruction and *evelopment,s
'%BR*,s( 3
t#
Rural !redit Pro5ect" +reement re9uired RB? to open a separate
ban) account &#ere t#e %BR* loan proceeds s#all be deposited" RB?
accordinly opened a special savins account &it# Metroban),s Tarlac Branc#"
+s t#e depository ban) of RB?, Metroban) &as desinated to receive t#e credit
advice released by !entral Ban), representin proceeds of %BR* loan of
farmers7borro&ers. Metroban), in turn, credited t#e proceeds to RB?,s special
savins account for latter,s release to farmers7borro&ers"

%n Sept 094E, !entral Ban) released a credit advice in Metroban),s favor and
accordinly credited Metroban),s demand deposit account in t#e amount of
@11L,986, for t#e account of RB?" T#e amount represented t#e approved loan
application of farmer7borro&er Do*in&+or + C$#$" RB? &it#dre& t#e
P04E,258 from its account"

On t#e same date, !entral Ban) approved t#e loan application of anot#er
farmer7borro&er, B&$i-io @&no"io, for @1LI,586, and credited t#e amount to
Metroban),s demand deposit account" Metroban), in turn, credited RB?,s
special savins account" Metroban) claims t#at RB? also &it#dre& t#e entire
credited amount from its account"
%n Oct 094E, !entral Ban) approved @onci&no L&(*&nA$ loan application for
@665,555" +mount &as also credited to Metroban),s demand deposit account,
&#ic# amount Metroban) later credited in favor of RB?,s special savins
account" Of t#e P886,666, RB? only &it#dre& P45,145"

%n Nov 094E, more t#an a mont# after RB? #ad made t#e above &it#dra&als
from its account &it# Metroban), 4ntr&- B&n, i$$#+ +/it &+.ic$,
reversing &-- t) &""ro.+ IBRD -o&n$. !entral Ban) implemented t#e
reversal by debitin from Metroban),s demand deposit account t#e amount
correspondin to all t#ree %BR* loans"
/pon receipt of t#e debit advices, Metroban), debited t#e follo&in amounts
from RB?,s special savins account- P0E9,658, P005,666, and PE,666"
Metroban), #o&ever, claimed t#at t#ese amounts &ere insufficient to cover all
t#e credit advices t#at &ere reversed by !entral Ban)" %t demanded payment
from RB?, &#ic# could ma)e partial payments" +s of Oct 0949, Metroban)
claimed t#at RB? #ad an outstandin balance of P113,886" To collect t#is
amount, Metroban) filed a co*"-&int %or co--ction o% $#* o% *on' aainst
RB? before t#e RT!"

RT4 r#-+ %or Mtro/&n,, findin t#at leal subroation #ad ensued" %t ordered
RB? to pay Metroban) t#e sum of P113,866, plus interest at 03K per annum
until t#e amount is fully paid"

On appeal, !+ noted t#at t#is &as not a case of leal subroation under +rticle
0168 of t#e !ivil !ode" Nevert#eless, !+ reconiHed t#at Metroban) #ad a ri#t
to be reimbursed of t#e amount it #ad paid and failed to recover, as it suffered
loss in an areement t#at involved only t#e !entral Ban) and t#e RB?" %t
clarified, #o&ever, t#at a determination still #ad to be made on &#o s#ould
reimburse Metroban)" Notin t#at no evidence e$ists &#y !entral Ban)
reversed t#e credit advices it #ad previously confirmed, 4A +c-&r+ t)&t
4ntr&- B&n, $)o#-+ / i*"-&++ &$ & nc$$&r' "&rt' so it could s#ed
li#t on t#e %BR* loan reversals" !+ set aside RT! decision, and remanded t#e
case to trial court for furt#er proceedins after t#e !entral Ban) is impleaded as
a necessary party" !+ denied t#e MR filed by Metroban), #ence, t#e present
petition for revie& on certiorari"
Metroban) disarees &it# !+,s rulin to implead t#e !entral Ban) as necessary
party and to remand t#e case to RT! for furt#er proceedins" %t arues t#at t#e
inclusion of !entral Ban) as party to t#e case is unnecessary since RB? #as
Att'. T. S&-.&+or : <8 : BDG ; SY 1<10
already admitted its liability for t#e amount Metroban) failed to recover in t#e 8
letters of RB?,s PresidentCManaer"
3
Metroban) also contends t#at a remand of
t#e case &ould unduly delay t#e proceedins"
5
I$$#! 0( @#o are t#e parties liable on t#e %BR* <oansJ !entral Ban), RB?
and ;armer7Borro&ers I Metroban) &as only a conduit for t#e transfer of money
6) W)t)r t) c&$ E*"-i%i$ & -(&- $#/ro(&tion, &n+ 2)t)r 4ntr&-
B&n, i$ & nc$$&r' "&rt'3 Y$, E*"-i%i$ & -(&- $#/ro(&tion &n+ NO,
4ENTRAL BAN? IS NOT A NE4ESSARY @ARTY.
H-+!
0( T#e Terms and !onditions of t#e %BR* 3
t#
Rural !redit Pro5ect e$ecuted by
!entral Ban) and RB? s#o&s t#at t#e farmers7borro&ers to &#om credits #ave
been e$tended, are primarily liable for t#e payment of t#e borro&ed amounts"
T#e loans &ere e$tended t#rou# RB?, &#ic# too) care of collection and of
remittance of collection to !entral Ban)" RB?, #o&ever, &as not a mere conduit
and collector" @#ile farmers7borro&ers &ere t#e principal debtors, RB?
assumed liability under t#e Pro5ect Terms and !onditions by solidarily bindin
itself &it# t#e principal debtors to fulfill t#e obliation" %f RB? delays in remittin
t#e amounts due, !entral Ban) imposed a 03K per annum penalty rate on RB?
until t#e amount is actually remitted" !entral Ban) &as furt#er aut#oriHed to
deduct t#e amount due from RB?,s demand deposit reserve s#ould t#e latter
become delin9uent in payment"
Based on t#ese arranements, !entral Ban),s immediate recourse, t#erefore
s#ould #ave been aainst t#e farmers7borro&ers and RB?. t#us, it erred &#en it
deducted t#e amounts covered by t#e debit advices from Metroban),s demand
deposit account" /nder t#e Pro5ect Terms and !onditions, Metroban) #ad no
responsibility over t#e proceeds of t#e %BR* loans ot#er t#an servin as a
conduit for t#eir transfer from !entral Ban) to RB? once credit advice #as been
issued" T#us, t#e areement overned only t#e parties involved I!entral Ban)
and RB?" Metroban) &as simply an outsider to t#e areement"
8( T) "r$nt c&$ E*"-i%i$ t) circ#*$t&nc cont*"-&t+ #n+r
4 %n t&o letters, RB?,s PresidentCManaer made proposals to Metroban) for repayment
of t#e amounts involved" Even assumin t#at no leal subroation too) place, Metroban)
claims t#at RB?,s letters more t#an sufficiently proved its liability"
5 T#e transactions involved in t#is case too) place in 094E, and t#e case &as
commenced before t#e RT! more t#an 86 years ao" T#e RT! resolved t#e complaint for
collection in 0993, &#ile t#e !+ decided t#e appeal in 8668" To implead !entral Ban), as a
necessary party in t#e case, means a return to s9uare one and t#e restart of t#e entire
proceedins"
"&r&(r&") 6 o% & -(&- $#/ro(&tion, #n+r o% Artic- 1<56 o% t) 4i.i- 4o+.
9
%t &as Metroban),s demand deposit account, instead of RB?,s, &#ic# t#e
!entral Ban) proceeded aainst, on t#e assumption per#aps t#at t#is &as t#e
most convenient means of recoverin t#e cancelled loans" Metroban) effectively
ans&ered for RB?,s obliations"

+fter Metroban) received !entral Ban),s debit advices in Nov 094E, Metroban)
debited t#e amounts it could from RB?,s special savins account &it#out any
ob5ection from RB?" RB?,s President and Manaer even &rote Metroban) &it#
proposals reardin possible means of settlin t#e amounts debited by !entral
Ban) from Metroban),s demand deposit account" T#ese instances are all
indicative of RB?,s approval of Metroban),s payment of t#e %BR* loans" T#at
RB?,s tacit approval came after payment does not completely neate t#e leal
subroation t#at #ad ta)en place"
+rticle 0161 of t#e !ivil !ode states t#at subroation transfers to t#e person
subroated t#e credit &it# all t#e ri#ts t#ereto appertainin, eit#er aainst t#e
debtor or aainst t#ird persons" +s t#e entity aainst &#ic# t#e collection &as
enforced, Metroban) &as subroated to t#e ri#ts of !entral Ban) and #as a
cause of action to recover from RB? t#e amounts it paid to t#e !entral Ban),
plus 03K per annum interest"
Un+r t)i$ $it#&tion, i*"-&+in( 4ntr&- B&n, &$ & "&rt' i$ co*"-t-'
#nnc$$&r'. In $o %&r &$ Mtro/&n, i$ concrn+, 4ntr&- B&n,A$
"r$nc &n+ r&$on$ %or it$ r.r$&-$ o% t) IBRD -o&n$ &r i**&tri&-
&%tr $#/ro(&tion )&$ t&,n "-&cN Mtro/&n,A$ intr$t i$ $i*"-' to co--ct
t) &*o#nt$ it "&i+ t) 4ntr&- B&n,. W)&t.r c&#$ o% &ction RBG *&'
)&. &(&in$t t) 4ntr&- B&n, %or t) #nE"-&in+ r.r$&-$ &n+ &n'
#n+# ++#ction$ i$ %or RBG to .nti-&t &$ & t)ir+:"&rt' c-&i*N i% it )&$
not +on $o, t)n t) *&ttr $)o#-+ / +&-t 2it) in & $"&r&t c&$ t)&t
$)o#-+ not in &n' 2&' %#rt)r +-&' t) +i$"o$ition o% t) "r$nt c&$
t)&t )&+ /n "n+in( /%or t) co#rt$ $inc 1IL5.
:o&ever, certain factual matters prevent t#e S! from fully resolvin t#e case, as
to t#e amount due"
4
6 +rt" 0168" %t is presumed t#at t#ere is leal subroation-
'0( @#en a creditor pays anot#er creditor &#o is preferred, even &it#out t#e debtor,s
)no&lede.
(6) W)n & t)ir+ "r$on, not intr$t+ in t) o/-i(&tion, "&'$ 2it) t) E"r$$ or
t&cit &""ro.&- o% t) +/torN
'1( @#en, even &it#out t#e )no&lede of t#e debtor, a person interested in t#e fulfillment
of t#e obliation pays, &it#out pre5udice to t#e effects of confusion as to t#e latter,s s#are"
7 *ifferent from Metroban),s complain, records s#o&ed only t#e credit and debit advices
for t#e amounts set aside for de Pesus and <aman. not#in in t#e findins of fact by t#e
Att'. T. S&-.&+or : <9 : BDG ; SY 1<10
Petition ranted, but remanded to RT!"
0) LEGAS@I TOWERS V. MUER
&ince it is the corporation that is the real party-in-interest in a derivative suit,
then the reliefs prayed for must *e for the *enefit or interest of the corporation.
;hen the reliefs prayed for do not pertain to the corporation, then it is an
improper derivative suit.
F&ct$- Pursuant to t#e by7la&s of <easpi To&ers 166, %nc", petitioners Palanca
and ot#er incumbent Board of *irectors 'Old BO*(, set t#e annual meetin of
t#e members of t#e condominium corporation and t#e election of t#e ne& Board
of *irectors at t#e lobby of <easpi To&ers" T#e !ommittee on Elections of
<easpi To&ers, #o&ever, found most of t#e pro$y votes irreular, t#us,
9uestionable. and for lac) of time to aut#enticate t#e same, petitioners
ad5ourned t#e meetin for lac) of 9uorum"
:o&ever, t#e roup of respondents Muer etc 'Ne& BO*( c#allened t#e
ad5ournment of t#e meetin" *espite old BO*,s insistence t#at no 9uorum &as
obtained durin t#e annual meetin, ne& BO* pus#ed t#rou# &it# t#e
sc#eduled election and &ere elected as t#e BO* and officers of <easpi To&ers
and subse9uently submitted a ?eneral %nformation S#eet to t#e SE! bearin
t#eir names"
Old BO* filed a Complaint for the )eclaration of Nullity of <lections with
'rayers for the lssuance of 15# and ;rit of 'reliminary -njunction and
)amages aainst ne& BO* &it# t#e RT! of Manila" Before ne& BO* could file
an +ns&er to t#e oriinal !omplaint, old BO* filed an +mended !omplaint"
B%or n2 BOD co#-+ $#/*it &n An$2r to t) A*n++ 4o*"-&int, o-+
BOD &(&in %i-+ & Motion to A+*it Scon+ A*n++ 4o*"-&int &n+
I$$#&nc o% TRO, "r&'in( t)&t t) n&* o% L(&$"i To2r$ <55, Inc., /
inc-#++ &$ "&rt':"-&inti%% in $&i+ Scon+ A*n++ 4o*"-&int.
Ne& BO* filed t#eir +ns&er to t#e +mended !omplaint, allein t#at from t#e
proceedins of t#e election reported by SE! representative, one +tty" Patricio, it
&as clear t#at t#e election &as la&fully conducted" Ne& BO* also prayed t#at
t#e name of <easpi To&ers 166, %nc" as party7plaintiff in t#e Second +mended
!omplaint be deleted as t#e said inclusion by t#e Old BO* &as made &it#out
aut#ority"
RT! and t#e !+ referred to t#e amount set aside for Panopio" @it# t#ese amounts
combined, RB?,s liability &ould amount to P19E,258 I same amount RB? ac)no&leded
in its letter" RB? asserts t#at it made partial payments amountin to P035,094 but neit#er
RT! nor !+ made a conclusive findin as to t#e accuracy of t#is claim" T#e !ourt is at a
loss on #o& Metroban) computed t#e amount of P113,886"
On plaintiffs, motion to admit amended complaint 'to include <easpi To&ers
166, %nc" as plaintiff(, t#e RT! ruled denyin t#e motion for bein improper"
T#en, Old BO* filed &it# t#e !+ &#ic# up#eld t#e decision of t#e T!" :ence
t#is petition"
Old BO* contends t#at <easpi T&oers s#ould be included as plaintiff because
it is a real party7in7 interest as it stands to be affected t#e most by t#e
controversy involvin t#e determination of &#et#er or not t#e corporation,s by7
la&s &as properly carried out in t#e meetin, &#en despite t#e ad5ournment of
t#e meetin for lac) of 9uorum, t#e elections &ere still conducted"
I$$#- @CN *erivative Suit is proper in t#is case"
H-+- T#e Supreme !ourt *EN%E* t#e petition and +;;%RME* t#e *ecision of
t#e !ourt of +ppeals" *erivative Suit is NOT applicable" Since it is t#e
corporation t#at is t#e real party7in7interest in a derivative suit, t#en t#e reliefs
prayed for must be for t#e benefit or interest of t#e corporation" @#en t#e reliefs
prayed for do not pertain to t#e corporation, t#en it is an improper derivative suit"
+ derivative suit must be differentiated from individual and representative or
class suits, t#us- Suits by stoc)#olders or members of a corporation based on
&ronful or fraudulent acts of directors or ot#er persons may be classified into
individual suits, class suits, and derivative suits" @#ere a stoc)#older or
member is denied t#e ri#t of inspection, #is suit &ould be in+i.i+#&- /c&#$
t) 2ron( i$ +on to )i* "r$on&--' &n+ not to t) ot)r $toc,)o-+r$ or
t) cor"or&tion. @#ere t#e 2ron( i$ +on to & (ro#" o% $toc,)o-+r$, as
&#ere preferred stoc)#oldersF ri#ts are violated, & c-&$$ or r"r$nt&ti.
$#it &ill be proper for t#e protection of all stoc)#olders belonin to t#e same
roup" But 2)r t) &ct$ co*"-&in+ o% con$tit#t & 2ron( to t)
cor"or&tion it$-%, t) c&#$ o% &ction /-on($ to t) cor"or&tion &n+ not
to t) in+i.i+#&- $toc,)o-+r or **/r. +lt#ou# in most every case of
&ron to t#e corporation, eac# stoc)#older is necessarily affected because t#e
value of #is interest t#erein &ould be impaired, t#is fact of itself is not sufficient
to ive #im an individual cause of action since t#e corporation is a person
distinct and separate from #im, and can and s#ould itself sue t#e &rondoer"
Ot#er&ise, not only &ould t#e t#eory of separate entity be violated, but t#ere
&ould be multiplicity of suits as &ell as a violation of t#e priority ri#ts of
creditors" ;urt#ermore, t#ere is t#e difficulty of determinin t#e amount of
damaes t#at s#ould be paid to eac# individual stoc)#older" :o&ever, in cases
of *i$*&n&(*nt 2)r t) 2ron(%#- &ct$ &r co**itt+ /' t)
+irctor$ or tr#$t$ t)*$-.$, a stoc)#older or member may find t#at #e
#as no redress because t#e former are vested by la& &it# t#e ri#t to decide
&#et#er or not t#e corporation s#ould sue, and t#ey &ill never be &illin to sue
t#emselves" T#e corporation &ould t#us be #elpless to see) remedy" Bc&#$
o% t) %r>#nt occ#rrnc o% $#c) & $it#&tion, t) co**on -&2 (r&+#&--'
rco(niH+ t) ri()t o% & $toc,)o-+r to $# on /)&-% o% & cor"or&tion in
2)&t .nt#&--' /c&* ,no2n &$ & O+ri.&ti. $#it.O %t #as been proven to
be an effective remedy of t#e minority aainst t#e abuses of manaement"
Att'. T. S&-.&+or : <1 : BDG ; SY 1<10
T)#$, &n in+i.i+#&- $toc,)o-+r i$ "r*itt+ to in$tit#t & +ri.&ti. $#it
on /)&-% o% t) cor"or&tion 2)rin ) )o-+$ $toc, in or+r to "rotct or
.in+ic&t cor"or&t ri()t$, 2)n.r o%%ici&-$ o% t) cor"or&tion r%#$ to
$# or &r t) on$ to / $#+ or )o-+ t) contro- o% t) cor"or&tion. In
$#c) &ction$, t) $#in( $toc,)o-+r i$ r(&r++ &$ t) no*in&- "&rt', 2it)
t) cor"or&tion &$ t) "&rt':in: intr$t.
Sinc it i$ t) cor"or&tion t)&t i$ t) r&- "&rt':in:intr$t in & +ri.&ti.
$#it, t)n t) r-i%$ "r&'+ %or *#$t / %or t) /n%it or intr$t o% t)
cor"or&tion. W)n t) r-i%$ "r&'+ %or +o not "rt&in to t) cor"or&tion,
t)n it i$ &n i*"ro"r +ri.&ti. $#it. T) r>#i$it$ %or & +ri.&ti. $#it
are as follo&s- &) t#e party brinin suit s#ould be a s#are#older as of t#e time
of t#e act or transaction complained of, t#e number of #is s#ares not bein
material. /) #e #as tried to e$#aust intra7corporate remedies, i"e", #as made a
demand on t#e board of directors for t#e appropriate relief but t#e latter #as
failed or refused to #eed #is plea. and c) t#e cause of action actually devolves
on t#e corporation, t#e &rondoin or #arm #avin been, or bein caused to t#e
corporation and not to t#e particular stoc)#older brinin t#e suit"

+s stated by t#e !+, old BO*,s complaint see)s to nullify t#e said election, and
to protect and enforce t#eir individual ri#t to vote" T#e cause of action devolves
on t#em, not t#e condominium corporation, &#ic# did not #ave t#e ri#t to vote"
:ence, t#e complaint for nullification of t#e election is a direct action by
petitioners, &#o &ere t#e members of t#e Board of *irectors of t#e corporation
before t#e election, aainst respondents, &#o are t#e ne&ly7elected Board of
*irectors" /nder t#e circumstances, t#e derivative suit filed by petitioners in
be#alf of t#e condominium corporation in t#e Second +mended !omplaint is
improper"
8) RE@UBLI4 .. AGUNOY
Doctrin! Every action must be prosecuted or defended in t#e name of t#e real
party7in7interest, meanin t#e party &#o stands to be benefited or in5ured by t#e
5udment in t#e suit, or t#e party entitled to t#e avails of t#e suit"
F&ct$! 't#is is a land titles case" en5oyQ #a#a( in 095E, +unoy filed an
application for ;ree Patent over 8 parcels of land located in Nueva Eci5a" T#e
Reister of *eeds 'R*( ranted t#e patent and issued t#e correspondin
Oriinal !ertificate of Title 'O!T(" But t#e #eirs of PereH caused t#e annotation
of an adverse claim in t#eir favour in said O!T" %n 0924, #eirs of PereH filed a
protest and t#e Bureau of <ands conducted an investiation" %t &as found out
t#at t#e patent and t#e O!T &ere improperly and fraudulently issued"
Nevert#eless, t#e #eirs of +unoy e$ecuted a *eed of E$tra5udicial Partition &it#
Sale in favour of Sanabol for P86,666" O!T &as cancelled and T!T &as
issued in favour of Sanabol"
Sanabol t#en sold an undivided portion of t#e property to Para" :e sold
anot#er parcel to PimeneH" +fter 9 mont#s, t#e R* of Nueva Eci5a cancelled t#e
adverse claim of PereH annotated at t#e bac) of t#e O!T" T#en t#e lot &as
subdivided" Some of t#e parcels &ere mortaed to t#e Rural Ban) of ?apan"
%n 09E2, Sanabol sold #is parcel to *ee" + ne& T!T &as issued to *ee" +fter 8
years, #eirs of PereH filed a supplemental protest, allein t#at t#ey, as &ell as
t#eir predecessors7in7interest, #ad been occupyin t#e land covered by t#e
patent and O!T of +unoy and t#at +unoy never occupied said land, and
t#erefore, t#e patent and title issued to +unoy &ere obtained t#rou# fraud and
misrepresentation" Bureau of <ands conducted anot#er investiation" T#e !#ief
of t#e <eal *ivision recommended to t#e *irector of <ands t#at court action be
instituted for t#e cancellation of +unoy,s patent and O!T"
No&, t#e rem part" T#e Republic of t#e P#illippines, t#ru t#e OS?, filed t#e
complaint in t#is case aainst several defendants, includin #eirs of +unoy,
*ee, and t#e Rural Ban) of ?apan" T#e Republic alleed t#at t#e free patent
and t#e O!T &ere procured by +unoy t#rou# fraud, deceit, and
misrepresentation since t#e property in 9uestion at t#e time t#e patent and t#e
title &ere issued &as already ad5udicated as private property of t#e #eirs of
PereH and Espiritu" T#us, it prayed t#at t#e patent and O!T be declared null
and void, for t#e defendants to surrender t#e o&ner,s duplicate copies of
certificates of title and to desisit from e$ercisin or representin acts of
o&ners#ip and possession" T#e trial court ruled in favor of t#e Republic" *ee
and t#e Rural Ban) appealed" T#e !+ ruled in favour of *ee and declared #im
as purc#aser in ood fait# and for value" %t furt#er ruled t#at t#e Republic is not
a real party in interest"
I$$#! @ON t#e Republic is a real party in interest 'NO(
H-+! T#e Republic is not t#e real party7in7interest" Every action must be
prosecuted or defended in t#e name of t#e real party7in7interest, meanin t#e
party &#o stands to be benefited or in5ured by t#e 5udment in t#e suit, or t#e
party entitled to t#e avails of t#e suit"
T#e very complaint in t#is case unmista)ably allees t#at t#e time t#e free
patent and t#e O!T &ere issued to +unoy, t#e property in 9uestion &as
already ad5udicated as PR%>+TE property of t#e #eirs of PereH and Espiritu and
t#at at t#at time, t#e property in 9uestion &as no loner a disposable public
land"
@it# t#e very admissions by t#e Republic in its pleadin t#at t#e lots are private
property, and are t#erefore no loner disposable land over &#ic# t#e t#en
Bureau of <ands no loner #ad any 5urisdiction and control, &e are simply at a
loss to understand #o& petitioner can still profess to be t#e real party7in7interest
in t#is case, and insist t#at t#e disputed properties are still part of t#e public
domain"
Att'. T. S&-.&+or : <L : BDG ; SY 1<10
Even as t#e complaint is one for reversion of private property to t#e mass of
public domain, Republic did not implead eit#er t#e #eirs of PereH or Espiritu"
+nd because t#e lands sub5ect of t#is case are no loner part of t#e public
domain, t#e nullification of t#e free patent and O!T &ould not result in t#e
reversion of t#e lands sub5ect t#ereof to t#e mass of public land" +nd t#e
overnment, not bein t#e real party7in7interest, is &it#out personality to institute
t#e reversion proceedins"
9) CUANA 4OM@LEF V. FIL:ESTATE LAND
Doctrin! Elements of a class suit- '0( t#e sub5ect matter of controversy is one
of common or eneral interest to many persons. '8( t#e parties affected are so
numerous t#at it is impracticable to brin t#em all to court. and, '1( t#e parties
brinin t#e class suit are sufficiently numerous or representative of t#e class
and can fully protect t#e interests of all concerned"
F&ct$! ;il7estate e$cavated <a PaH Road, &#ic# made Puana !omple$
:omeo&ners +ssoc" 'P!:+(, commuters and motorists unable to use said road"
P!:+, toet#er &it# ot#er residents, instituted a complaint for damaes, in its
own *ehalf and as a class suit representing the regular commuters and
motorists of 8uana Comple! and neigh*oring su*divisions &#o &ere deprived of
t#e use of <a PaH Road, aainst ;il7Estate" P!:+ et al" claims t#at t#e
e$cavation caused damae, pre5udice, inconvenience, annoyance and loss of
precious #ours to t#em, since traffic &as re7routed to narro& streets"
;il7Estate filed a motion to dismiss aruin t#at t#e complaint failed to state a
cause of action and was improperly filed as a class suit.
I$$#$!
0" @CN t#e complaint establis# a cause of action" '=ES(
6. WBN t) co*"-&int 2&$ "ro"r-' %i-+ &$ & c-&$$ $#it. (YES)
777i$$# r-&t+ to "&rti$
:eld-
0" T#e alleations in t#e complaint &ere sufficient to establis# a cause of action,
since first, P!:+, et al",s averments s#o& a demandable ri#t over <a PaH Road
'i"e" t#ey,ve been usin it for 06 years, an easement of a ri#t of &ay #as been
constituted(. second, t#ere is an alleed violation of ri#t committed by ;il7estate
'i"e" t#ey prevented commuters and motorists from usin t#e road(. and third,
P!:+ et" al" conse9uently suffered in5ury"
8" Section 08, Rule 1 of t#e Rules of !ourt defines a class suit, as follo&s-
Sec" 08" !lass suit" I @#en t#e sub5ect matter of t#e controversy is one of
common or eneral interest to many persons so numerous t#at it is impracticable
to 5oin all as parties, a number of t#em &#ic# t#e court finds to be sufficiently
numerous and representative as to fully protect t#e interests of all concerned
may sue or defend for t#e benefit of all" +ny party in interest s#all #ave t#e ri#t
to intervene to protect #is individual interest"

T) nc$$&r' -*nt$ %or t) *&intn&nc o% & c-&$$ $#it &r!
1) t) $#/=ct *&ttr o% contro.r$' i$ on o% co**on or (nr&-
intr$t to *&n' "r$on$N
6) t) "&rti$ &%%ct+ &r $o n#*ro#$ t)&t it i$ i*"r&ctic&/- to
/rin( t)* &-- to co#rtN &n+
<) t) "&rti$ /rin(in( t) c-&$$ $#it &r $#%%icint-' n#*ro#$ or
r"r$nt&ti. o% t) c-&$$ &n+ c&n %#--' "rotct t) intr$t$ o% &--
concrn+.
T#e present suit is clearly one t#at benefits all commuters and motorists &#o
use <a PaH Road" T#e records reveal t#at numerous individuals #ave filed
manifestations &it# t#e lo&er court, conveyin t#eir intention to 5oin P!:+ et al"
in t#e suit and claimin t#at t#ey are similarly situated &it# for t#ey &ere also
pre5udiced by t#e acts of ;il7estate in closin and e$cavatin t#e <a PaH Road"
Moreover, t#e individuals sou#t to be represented by P!:+ et al" are so
numerous t#at it is impracticable to 5oin t#em all as parties and be named
individually as plaintiffs in t#e complaint"
1) BANDA V. ERMITA (6515)
Doctrin$! 0( Re9uisites of a !lass Suit-
a( t#e sub5ect matter of controversy is one of common or eneral interest
to many persons.
b( t#e parties affected are so numerous t#at it is impracticable to brin
t#em all to court. and
c( t#e parties brinin t#e class suit are sufficiently numerous or
representative of t#e class and can fully protect t#e interests of all
concerned"
8( %n determinin t#e 9uestion of fair and ade9uate representation of members
of a class, t#e court must consider-
a( &#et#er t#e interest of t#e named party is coe$tensive &it# t#e interest
of t#e ot#er members of t#e class.
b( t#e proportion of t#ose made a party, as it so bears, to t#e total
members#ip of t#e class. and
c( any ot#er factor bearin on t#e ability of t#e named party to spea) for
t#e rest of t#e class"
1( @#ere t#e interests of t#e plaintiffs and t#e ot#er members of t#e class t#ey
see) to represent are diametrically opposed, t#e class suit &ill not prosper"
F&ct$! ;ormer President +rroyo issued EO 14E effectively amendin EO 8E5 of
;ormer President !ory +9uino" EO 8E5 created t#e National Printin Office
'NPO( &#ic# vests &it# it t#e e$clusive 5urisdiction over t#e printin services
Att'. T. S&-.&+or : <I : BDG ; SY 1<10
re9uirements of overnment aencies and instrumentalities" EO 14E amended
t#is by removin NPO,s e$clusive 5urisdiction over t#e printin services"
?overnment aencies can no& ac9uire services of a private company provided
t#at t#e 9uality is better &#ile t#e cost is lo&er t#an t#at produced by NPO" T#is
EO 14E also limited t#e appropriations to be iven to NPO to t#ose actually
earned by it"
Some of t#e employees of NPO filed a class suit 9uestionin its
constitutionality" T#ey alleed t#at t#eir security of tenure is at ris) since t#e
amendment is alleedly part of an eventual plan of abolis#in NPO"
I$$#! 1) @roc+#r&- Q @#et#er t#e class suit is proper in t#is case" 'NO(
6) S#/$t&nti. 1 I @#et#er t#e President &ent beyond #er e$ecutive po&ers
&#en s#e amended EO 8E5" '=es I deleated po&er to oraniHe administrative
aencies &#ic# &ill fall under t#e Office of t#e President(
<) S#/$t&nti. 6 I @#et#er EO 14E violates t#eir security of tenure '&as not
able to substantiate t#is alleation(
H-+! /the important issue is only the first one
1) T) "tition +o$ not >#&-i%' &$ & c-&$$ $#it.
%n (oard of #ptometry v. Colet, t#e !ourt #eld t#at LNcOourts must e$ercise
utmost caution before allo&in a class suit, &#ic# is t#e e$ception to t#e
re9uirement of 5oinder of all indispensable parties" ;or &#ile no difficulty may
arise if t#e decision secured is favorable to t#e plaintiffs, a 9uandary &ould
result if t#e decision &ere ot#er&ise as t#ose &#o &ere deemed impleaded by
t#eir self7appointed representatives &ould certainly claim denial of due process"M
Section 08, Rule 1 of t#e Rules of !ourt defines a class suit" ;rom t#e
definition, t#e r>#i$it$ o% & c-&$$ $#it are-
0( t#e sub5ect matter of controversy is one of common or eneral interest
to many persons.
8( t#e parties affected are so numerous t#at it is impracticable to brin
t#em all to court. and
1( t#e parties brinin t#e class suit are sufficiently numerous or
representative of t#e class and can fully protect t#e interests of all
concerned"

%n 4athay v. 1he Consolidated (an0 and 1rust Company, t#e !ourt #eld t#at-

+n action does not become a class suit merely because it is
desinated as suc# in t#e pleadins" @#et#er t#e suit is or is
not a class suit depends upon t#e attendin facts, and t)
co*"-&int, or ot)r "-&+in( initi&tin( t) c-&$$ &ction
$)o#-+ &--( t#e e$istence of t#e necessary facts, to &it, t#e
e$istence of a sub5ect matter of common interest, and t#e
e$istence of a class and t) n#*/r o% "r$on$ in t)
&--(+ c-&$$,

in or+r t)&t t) co#rt *i()t / n&/-+ to
+tr*in 2)t)r t) **/r$ o% t) c-&$$ &r $o
n#*ro#$ &$ to *&, it i*"r&ctic&/- to /rin( t)* &--
/%or t) co#rt, to contr&$t t) n#*/r &""&rin( on t)
rcor+ 2it) t) n#*/r in t) c-&$$ &n+ to +tr*in
2)t)r c-&i*&nt$ on rcor+ &+>#&t-' r"r$nt t)
c-&$$ &n+ t) $#/=ct *&ttr o% (nr&- or co**on
intr$t"

:ere, t#e petition failed to state t#e number of NPO employees &#o &ould be
affected by t#e assailed EO and &#o &ere alleedly represented by
petitioners" %t &as t#e Solicitor ?eneral, as counsel for respondents, &#o
pointed out t#at t#ere &ere about 539 employees in t#e NPO" T#e 24
petitioners undeniably comprised a small fraction of t#e NPO employees &#om
t#ey claimed to represent" Subse9uently, 18 of t#e oriinal petitioners e$ecuted
an +ffidavit of *esistance, &#ile one sined a letter denyin ever sinin t#e
petition, ostensibly reducin t#e number of petitioners to 13" @e note t#at
counsel for t#e petitioners c#allened t#e validity of t#e desistance or
&it#dra&al of some of t#e petitioners and insinuated t#at suc# desistance &as
due to pressure from people Lclose to t#e seat of po&er"M Still, even if &e &ere
to disreard t#e affidavit of desistance filed by some of t#e petitioners, it is
#i#ly doubtful t#at a sufficient, representative number of NPO employees #ave
instituted t#is purported class suit" + perusal of t#e petition itself &ould s#o&
t#at of t#e 24 petitioners &#o sined t#e >erificationC!ertification of Non7;orum
S#oppin, only 86 petitioners &ere in fact mentioned in t#e jurat as #avin duly
subscribed t#e petition before t#e notary public" %n ot#er &ords, only 86
petitioners effectively instituted t#e present case"

%ndeed, in 495& 'u*lications, -nc. v. -slamic )a=wah Council of the 'hilippines,
-nc., &e observed t#at an element of a class suit or representative suit is t#e
&+>#&c' o% r"r$nt&tion" %n determinin t#e 9uestion of fair and ade9uate
representation of members of a class, t#e court must consider-
d( &#et#er t#e interest of t#e named party is coe$tensive &it# t#e interest
of t#e ot#er members of t#e class.
e( t#e proportion of t#ose made a party, as it so bears, to t#e total
members#ip of t#e class. and
f( any ot#er factor bearin on t#e ability of t#e named party to spea) for
t#e rest of t#e class"
;urt#ermore, &#ere t#e interests of t#e plaintiffs and t#e ot#er members of t#e
class t#ey see) to represent are diametrically opposed, t#e class suit &ill not
prosper" %t is &ort# mentionin t#at a Manifestation of *esistance &as filed by
t#e President of t#e National Printin Office @or)ers +ssociation
'N+PO@+(" T#e said manifestation e$pressed N+PO@+,s opposition to t#e
filin of t#e instant petition in any court" Even if &e ta)e into account t#e
contention of petitioners, counsel t#at t#e N+PO@+ President #ad no leal
standin to file suc# manifestation, t#e said pleadin is a clear indication t#at
Att'. T. S&-.&+or : 05 : BDG ; SY 1<10
t#ere is a diverence of opinions and vie&s amon t#e members of t#e class
sou#t to be represented, and not all are in favor of filin t#e present
suit" T#ere is #ere an apparent conflict bet&een petitioners, interests and t#ose
of t#e persons &#om t#ey claim to represent"
Ot)r i$$#$B)-+!
6) %t is a &ell7settled principle in 5urisprudence t#at t#e President #as t#e po&er
to reoraniHe t#e offices and aencies in t#e e$ecutive department in line &it#
t#e President,s constitutionally ranted po&er of control over e$ecutive offices
and by virtue of previous deleation of t#e leislative po&er to reoraniHe
e$ecutive offices under e$istin statutes" 'Section 10, !#apter 06, Title %%%, Boo)
%%% of t#e +dministrative !ode of 09E4("
<( T#e basic evidentiary rule is t#at #e &#o asserts a fact or t#e affirmative of
an issue #as t#e burden of provin it" + careful revie& of t#e records &ill s#o&
t#at petitioners utterly failed to substantiate t#eir claim" T#ey failed to allee,
muc# less prove, sufficient facts to s#o& t#at t#e limitation of t#e NPO,s budet
to its o&n income &ould indeed lead to t#e abolition of t#e position, or removal
from office, of any employee" Neit#er did petitioners present any s#red of proof
of t#eir assertion t#at t#e c#anes in t#e functions of t#e NPO &ere for political
considerations t#at #ad not#in to do &it# improvin t#e efficiency of, or
encourain operational economy in, t#e said aency"

L) NA@ERE .. BARBARONA
Doctrin T#e rule on substitution of #eirs is not a matter of 5urisdiction, but a
re9uirement of due process" %t is only &#en t#ere is a denial of due process, as
&#en t#e deceased is not represented by any leal representative or #eir, t#at
t#e court nullifies t#e trial proceedins and t#e resultin 5udement t#erein"
F&ct$ Barbarona is t#e reistered o&ner of lot 1044 locate in <eyte" <ot 1042 in
t#e name of +nacleto Napere ad5oins t#e said lot on t#e nort#7eastern side"
+nacleto Napere died, #erein petitioner Puan Napere 'son( and #is &ife planted
coconut trees on certain portions of t#e property &it# t#e consent of t#e co7
o&ners" Respondent Barbarona alleed t#at #erein petitioners Napere, t#eir
relatives and labourers occupied and encroac#ed upon t#e nort#7eastern side
by means of stealt# and stratey and t#at despite demands, Naperes refused to
turn over t#e possession of t#e said area" Naperes repeatedly encroac#ed on
respondent,s property and repeatedly refused to vacate" :o&ever, Puan
Naperes died &#ile t#e case &as still pendin" :is counsel t#en informed t#e
court of t#e deat# of Puan Naperes and submitted t#e names and addresses of
t#e #eirs" T! decided aainst #eirs of Naperes" !+ affirmed" Petitioners &ere
allein t#at t#e T! did not ac9uire 5urisdiction over t#e person of t#e #eirs
because of t#e failure to order substitution pursuant to Section 04 Rule 1 of t#e
Rules of !ourt"
I$$# @#et#er T! decision is void for lac) of 5urisdiction over t#e #eirs of Puan
NapereJ NO
H-+ @#en a party in a pendin case dies and claim is not e$tinuis#ed by
deat#, t#e Rules re9uire t#e substitution of t#e deceased party by #is leal
representatives or #eirs" T#e counsel is oblied to inform t#e court of t#e deat#
of #is client and t#e names and addresses of t#e #eirs" T#e complaint for
recovery of possession, 9uietin of title and damaes is an action t#at survives
t#e deat# of t#e defendant" %n t#is case, t#e T! failed to order t#e substitution of
t#e #eirs" T#e S! #o&ever ruled t#at t#e proceedins conducted and t#e
5udment rendered by t#e T! are valid" Mere failure to substitute a deceased
party is not sufficient round to nullify a T!,s decision" T#e party allein nullity
must prove t#at t#ere &as undeniable violation of due process"
T#e rule on substitution of #eirs is not a matter of 5urisdiction, but a re9uirement
of due process" %t is only &#en t#ere is a denial of due process, as &#en t#e
deceased is not represented by any leal representative or #eir, t#at t#e court
nullifies t#e trial proceedins and t#e resultin 5udement t#erein" ;ormal
substitution by #eirs is not necessary &#en t#ey t#emselves voluntarily appear,
participate in t#e case and present evidence in defense of t#e deceased" @#en
due process is not violated, as &#en t#e ri#t of t#e representative or #eir is
reconiHed and protected, noncompliance or belated formal compliance &it# t#e
Rules cannot affect t#e validity of t#e promulated decision" %n t#e case at #and,
records s#o& t#at t#e counsel of Napere and petitioner continued to represent
t#em eve after t#e deat# of Puan" Petitioner t#erefore &as able to ade9uately
defend #erself and t#e deceased in t#e proceedins" *ue process simply
demands and opportunity to be #eard and suc# opportunity &as not denied to
petitioner"
I) MEMORA4ION 4RUM .. OSWALDO M. 4RUM
Doctrin! %f t#e action survives despite deat# of a party, it is t#e duty of t#e
deceased,s counsel to inform t#e court of suc# deat#, and to ive t#e names
and addresses of t#e deceased,s leal representatives" T#e deceased may be
substituted by #is #eirs in t#e pendin action"
%n t#e causes of action &#ic# survive, t#e &ron complained of affects
primarily and principally property and property ri#ts, t#e in5uries to t#e
person bein merely incidental, &#ile in t#e causes of action &#ic# do
not survive, t#e in5ury complained of is to t#e person, t#e property and
ri#ts of property affected bein incidental"
F&ct$!
On October 0E, 0991, Memoracion D" !ruH filed &it# t#e Manila RT! a
!omplaint aainst #er son, defendant7appellee Os&aldo D" !ruH, for
L+nnulment of Sale, Reconveyance and *amaes"M
Memoracion claimed t#at-
Att'. T. S&-.&+or : 01 : BDG ; SY 1<10
o durin #er union &it# #er common7la& #usband 'deceased( +rc#itect
?uido M" !ruH, s#e ac9uired a parcel of land located at Tabora corner
<imay Streets, Bo" Obrero, Tondo Manila
o t#e said lot &as reistered in #er name at t#e R* of Manila
o sometime in Puly 0998, s#e discovered t#at t#e title to t#e said property
&as transferred by Os&aldo and t#e latter,s &ife in t#eir names in
+uust 0990 by virtue of a *eed of Sale dated ;ebruary 08, 0941
o t#e said deed &as e$ecuted t#rou# fraud, forery, misrepresentation
and simulation, #ence, null and void
o s#e, &it# t#e #elp of #er #usband,s relatives, as)ed Os&aldo to settle
t#e problem but t#e latter still refused to reconvey t#e said property
+fter Memoracion finis#ed presentin #er evidence in c#ief, s#e died on
October 16, 0992" T#rou# a Manifestation, Memoracion,s counsel, +tty"
Roberto T" Neri, notified t#e trial court on Panuary 01, 0994 of t#e fact of
suc# deat#, evidenced by a certificate t#ereof"
Os&aldo filed a MT* on t#e rounds t#at '0( t#e plaintiff,s reconveyance
action is a personal action &#ic# does not survive a party,s deat#, pursuant
to Section 80, Rule 1 of t#e RO!, and '8( to allo& t#e case to continue
&ould result in leal absurdity &#ereby one #eir is representin t#e
defendant Nand is aO co7plaintiff in t#is case"
RT!- On Pune 8, 0994, *%SM%SSE* t#e case &it#out pre5udice to t#e
prosecution t#ereof in t#e proper estate proceedins
On October 04, 0994, Memoracion,s son7#eir, Edardo D" !ruH, manifested
to t#e trial court t#at #e is retainin t#e services of +tty" Neri for t#e
plaintiff" Simultaneously, +tty" Neri filed a MR of t#e Pune 8, 0994
Order" :o&ever, t#e said motion &as subse9uently denied by +ctin
Presidin Pude !ielito N" Mindaro7?rulla Non October 10, 8666O"
!+- rendered 5udment +;;%RM%N? &it# modification t#e RT! decision"
't#e directive as to prosection of t#e action in t#e proper estate proceedins
&as deleted(

I$$#$!
'0( &Cn !+ erred in rulin t#at Memoracion D" !ruH,s petition for annulment
of deed of sale, reconveyance and damaes is a purely personal action
&#ic# did NOT survive #er deat# I =ES, !+ ERRE*" T#e petition for
annulment of sale, reconveyance and damaes survived t#e deat# of
petitioner"
'8( &Cn !+ erred in affirmin &it# modification t#e RT! order dismissin
t#e petition for annulment of deed of sale, reconveyance and damaes
I =ES, !+ ERRE*"
H-+!
(1) T#e criterion for determinin &#et#er an action survives t#e deat# of a
petitioner &as elucidated in (onilla v. (arcena-
T) >#$tion &$ to 2)t)r &n &ction $#r.i.$ or not +"n+$ on t)
n&t#r o% t) &ction &n+ t) +&*&( $#+ %or. In t) c&#$$ o% &ction
2)ic) $#r.i., t) 2ron( co*"-&in+ o% &%%ct$ "ri*&ri-' &n+
"rinci"&--' "ro"rt' &n+ "ro"rt' ri()t$, t) in=#ri$ to t) "r$on
/in( *r-' inci+nt&-, 2)i- in t) c&#$$ o% &ction 2)ic) +o not
$#r.i., t) in=#r' co*"-&in+ o% i$ to t) "r$on, t) "ro"rt' &n+
ri()t$ o% "ro"rt' &%%ct+ /in( inci+nt&-"
I% t) c&$ &%%ct$ "ri*&ri-' &n+ "rinci"&--' "ro"rt' &n+ "ro"rt'
ri()t$, t)n it $#r.i.$ t) +&t) o% t) "-&inti%% or
"titionr. %n &umaljag v. $iterato, t#e !ourt #eld t#at a Petition for
*eclaration of Nullity of *eed of Sale of Real Property is one relatin to
property and property ri#ts, and t#erefore, survives t#e deat# of t#e
petitioner" +ccordinly, t#e instant case for annulment of sale of real
property merits survival despite t#e deat# of petitioner Memoracion D"
!ruH"

(6) W)n & "&rt' +i$ +#rin( t) "n+nc' o% & c&$, Sction 19, R#-
< o% t) 1II1 R.i$+ R#-$ o% 4i.i- @roc+#r nc$$&ri-'
&""-i$, vi0!
Sc. 19. Death of party$ duty of counsel, : W)n.r & "&rt' to
& "n+in( &ction +i$, &n+ t) c-&i* i$ not t)r/'
Etin(#i$)+, it $)&-- / t) +#t' o% )i$ co#n$- to in%or* t)
co#rt 2it)in t)irt' (<5) +&'$ &%tr $#c) +&t) o% t) %&ct
t)ro%, &n+ to (i. t) n&* &n+ &++r$$ o% )i$ -(&-
r"r$nt&ti. or r"r$nt&ti.$. F&i-#r o% co#n$- to
co*"-' 2it) t)i$ +#t' $)&-- / & (ro#n+ %or +i$ci"-in&r'
&ction.
T) )ir$ o% t) +c&$+ *&' / &--o2+ to / $#/$tit#t+
%or t) +c&$+, 2it)o#t r>#irin( t) &""oint*nt o% &n
Ec#tor or &+*ini$tr&tor &n+ t) co#rt *&' &""oint &
(#&r+i&n ad litem %or t) *inor )ir$.
T) co#rt $)&-- %ort)2it) or+r $&i+ -(&- r"r$nt&ti. or
r"r$nt&ti.$ to &""&r &n+ / $#/$tit#t+ 2it)in & "rio+
o% t)irt' (<5) +&'$ %ro* notic.
I% no -(&- r"r$nt&ti. i$ n&*+ /' t) co#n$- %or t)
+c&$+ "&rt', or i% t) on $o n&*+ $)&-- %&i- to &""&r
2it)in t) $"ci%i+ "rio+, t) co#rt *&' or+r t) o""o$in(
"&rt', 2it)in & $"ci%i+ ti*, to "roc#r t) &""oint*nt o%
&n Ec#tor or &+*ini$tr&tor %or t) $t&t o% t) +c&$+
&n+ t) -&ttr $)&-- i**+i&t-' &""&r %or &n+ on /)&-% o%
t) +c&$+. T) co#rt c)&r($ in "roc#rin( $#c)
&""oint*nt, i% +%r&'+ /' t) o""o$in( "&rt', *&' /
rco.r+ &$ co$t$.
Att'. T. S&-.&+or : 06 : BDG ; SY 1<10
I% t) &ction $#r.i.$ +$"it +&t) o% & "&rt', it i$ t) +#t' o% t)
+c&$+A$ co#n$- to in%or* t) co#rt o% $#c) +&t), &n+ to (i.
t) n&*$ &n+ &++r$$$ o% t) +c&$+A$ -(&- r"r$nt&ti.$.
T) +c&$+ *&' / $#/$tit#t+ /' )i$ )ir$ in t) "n+in(
&ction. +s e$plained in (onilla2 +rticle 444 of t#e !ivil !ode provides
Lt#at t#e ri#ts to t#e succession are transmitted from t#e moment of
t#e deat# of t#e decedent"M Fro* t) *o*nt o% t) +&t) o% t)
+c+nt, t) )ir$ /co* t) &/$o-#t o2nr$ o% )i$ "ro"rt',
$#/=ct to t) ri()t$ &n+ o/-i(&tion$ o% t) +c+nt, &n+ t)'
c&nnot / +"ri.+ o% t)ir ri()t$ t)rto Ec"t /' t) *t)o+$
"ro.i++ %or /' -&2. T) *o*nt o% +&t) i$ t) +tr*inin(
%&ctor 2)n t) )ir$ &c>#ir & +%init ri()t to t) in)rit&nc
2)t)r $#c) ri()t / "#r or contin(nt. T) ri()t o% t) )ir$ to
t) "ro"rt' o% t) +c&$+ .$t$ in t)* .n /%or =#+ici&-
+c-&r&tion o% t)ir /in( )ir$ in t) t$t&t or int$t&t
"roc+in($. @#en NplaintiffO, t#erefore, diedN,O #er claim or ri#t to t#e
parcels of land &as not e$tinuis#ed by #er deat# but &as transmitted
to #er #eirs upon #er deat#" :er #eirs #ave t#us ac9uired interest in
t#e properties in litiation and became parties in interest in t#e case"
T#ere is, t#erefore, no reason for t#e respondent !ourt not to allo&
t#eir substitution as parties in interest for t#e deceased plaintiff"
I% no -(&- r"r$nt&ti. i$ n&*+ /' t) co#n$- o% t)
+c&$+, or t) -(&- r"r$nt&ti. %&i-$ to &""&r 2it)in &
$"ci%i+ "rio+, it i$ t) +#t' o% t) co#rt 2)r t) c&$ i$
"n+in( to or+r t) o""o$in( "&rt' to "roc#r t) &""oint*nt
o% &n Ec#tor or &+*ini$tr&tor %or t) $t&t o% t)
+c&$+. T) r&$on %or t)i$ r#- i$ to "rotct &-- concrn+ 2)o
*&' / &%%ct+ /' t) intr.nin( +&t), "&rtic#-&r-' t)
+c&$+ &n+ )i$ $t&t"
%n t#e instant case, Memoracion D" !ruH died on Oct" 16, 0992" :er
counsel, +tty" Roberto T" Neri, notified t#e trial court of suc# deat# on
Pan" 01, 0994" On Pan" 83, 0994, Os&aldo moved to dismiss t#e case
on t#e round t#at it did not survive Memoracion,s deat#" RT! ranted
t#e MT*"

T#e !ourt rules it &as error for t#e RT! to dismiss t#e case" T)
"tition %or &nn#-*nt o% ++ o% $&- in.o-.$ "ro"rt' &n+
"ro"rt' ri()t$, &n+ )nc, $#r.i.$ t) +&t) o% petitioner
Memoracion" T#e RT! &as informed, albeit belatedly, of t#e deat# of
Memoracion, and &as supplied &it# t#e name and address of #er leal
representative, Edardo !ruH" @#at t#e RT! could #ave done &as to
re9uire Edardo !ruH to appear in court and substitute Memoracion as
party to t#e pendin case"
15) HERITAGE @AR? V. 4IA4
Doctrin- T#e settled rule is t#at 5urisdiction once ac9uired is not lost upon t#e
instance of t#e parties but continues until t#e case is terminated" !ourts cannot
allo& parties t#at disaree &it# t#e decision of a 5udicial tribunal to annul t#e
same t#rou# t#e e$pedient of transferrin t#eir interests or ri#ts involved in
t#e case" Mere transferees of interests are bound by t#e proceedins in li)e
manner as its predecessor"
F&ct$- Bases !onversion *evelopment +ut#ority 'B!*+(, Pool ;ormation Trust
+reement 'P;T+(, PNB and Public Estates +ut#ority 'PE+( entered into an
areement to develop t#e :eritae Memorial Par) in ;ort Bonifacio, Taui"
B!*+ &as t#e Pro5ect O&ner and tas)ed to sell :eritae Par) %nvestment
!ertificates to buyers" +s trustee, PNB is iven t#e leal and beneficial title to
#old t#e certificates" T#e certificate #olders oraniHed t#emselves into a non7
stoc), non7profit corporation, :eritae Par) Manaement !orp" ':PM!("
No&, PE+ and /y,s business 'Edison *ev,t and !onstruction( e$ecuted a
<andscapin and !onstruction +reement &#ereby t#e business &ill do all t#e
landscapin and t#e construction of a terrasoleum" Since t#ere &as delay in t#e
construction due to t#e presence of s9uatters, amon ot#er reasons, t#e
:eritae Par) E$ecutive !ommittee terminated t#e construction contracts so
:PM! assumed all t#e duties and responsibilities of PE+ pursuant to a deed of
assinment
/y filed a complaint aainst PE+ before t#e !onstruction %ndustry +rbitrary
!ommission '!%+!( &#ere it sou#t to recover payments for t#e construction
already done in t#e pro5ect and &it# damaes arisin from its delay in t#e
delivery of t#e entire property for landscapin and additional rental costs for
e9uipment &#ic# &ere )ept on standby and labor costs for idle manpo&er" T#e
!%+! a&arded monetary claims to /y and a Notice of ?arnis#ment &as served
on :PM!"
:PM! t#en filed a petition for %n5unctionCPro#ibition before t#e !+ on t#e round
t#at t#e !%+! #ad no 5urisdiction since :PM! &as not impleaded as a party in
t#e case before !%+!" :PM! contended it is an indispensable party since it
#olds t#e certificates, any claim aainst PE+ is a claim aainst all parties &#o
contributed funds to t#e pro5ect"
I$$#- @CN :eritae an indispensable party to t#e !%+! caseJ NOQ
H-+- %t must be remembered t#at &#en t#e case &as oriinally filed by E*!
before t#e !%+! on Panuary 08, 8666, PE+ #ad not yet transferred its ri#ts and
obliations over t#e Pro5ect to :eritae, as evidenced by t#e *eed of
+ssinment dated Marc# 8666" T#us, by impleadin PE+ as respondent, t#e
!%+! #ad 5urisdiction over t#e case at t#at time" :eritae, #o&ever, claims t#at
&#en PE+ transferred its ri#ts and obliations over t#e Pro5ect to :eritae, t#e
!%+! lost its 5urisdiction" %n ot#er &ords, :eritae allees t#at a court may lose
Att'. T. S&-.&+or : 0< : BDG ; SY 1<10
5urisdiction over a case based on t#e subse9uent actions of t#e parties" T#is is
unacceptable"
T#e settled rule is t#at 5urisdiction once ac9uired is not lost upon t#e instance of
t#e parties but continues until t#e case is terminated" !ertainly, it &ould be t#e
#ei#t of in5ustice to allo& parties t#at disaree &it# t#e decision of a 5udicial
tribunal to annul t#e same t#rou# t#e e$pedient of transferrin t#eir interests or
ri#ts involved in t#e case" Moreover, :eritae is mista)en &#en it claims t#at it
is an indispensible party to t#e case and t#at it &as not included in t#e case
before t#e !%+!" Bin( & tr&n$%r o% t) intr$t$ o% @EA o.r t) @ro=ct
+#rin( t) "n+nc' o% t) c&$ /%or t) 4IA4, it i$ /o#n+ /' t)
"roc+in($ in -i, *&nnr &$ @EA" %n 8ocson v. Court of +ppeals, t#is !ourt
#eld t#e Ban) of t#e P#ilippine %slands is bound by t#e decision of t#e trial court
bein t#e transferee pendente lite of t#e oriinal defendant t#erein, despite t#e
fact t#at it #ad not been substituted for t#e oriinal defendant and #ad not been
notified of t#e proceedins aainst it"
Rule 1 of Section 86 'no& Section 09, Rule 1( of t#e Rules of !ourt provides-
SE!" 86" Transfer of %nterest" I %n case of any transfer of interest, t#e action
may be continued by or aainst t#e oriinal party unless t#e court upon motion
directs t#e person to &#om t#e interest is transferred to be substituted in t#e
action or 5oined &it# t#e oriinal party"
T)i$ 4o#rt )&$ +c-&r+ in & n#*/r o% +ci$ion$ t)&t & tr&n$%r
"n+nt -it $t&n+$ in E&ct-' t) $&* "o$ition &$ it$ "r+c$$or:in:
intr$t, t) ori(in&- +%n+&nt, &n+ i$ /o#n+ /' t) "roc+in($ )&+ in
t) c&$ /%or t) "ro"rt' 2&$ tr&n$%rr+ to it. It i$ & "ro"r /#t not &n
in+i$"n$i/- "&rt' &$ it 2o#-+ in &n' .nt / /o#n+ /' t) =#+(*nt
&(&in$t )i$ "r+c$$or"
>erily, t#e non7inclusion of :eritae in t#e proceedins before t#e !%+! is of no
moment as t#e Rules of !ourt specifically allo&s t#e proceedins to proceed
&it# t#e oriinal parties &#ile bindin t#e transferee"
NOTE- T#e S! said t#at t#e !%+! decision violated t#e TRO issued by !+"
Suc# violation, #o&ever, &as attended by ood fait# considerin t#at t#e !%+!
made sure t#at t#e *ecision &ould only be released after t#e e$piration of t#e
TRO" T#us, no sanction &ill be meted out to t#e !%+! in t#is instance"
11) GENATO .$ BAYHON
FA4TS! Respondent Bay#on contracted a loan from petitioner ?enato"
Bay#on, toet#er &it# #is #ers as co7parties, filed an action for t#e
declaration of nullity of a dacion en pao 'transfer of a lot to cover t#e
loan( alleedly e$ecuted by Bay#on in favor of ?enato" ?enato filed an
action for specific performance before t#e RT! allein t#at Bay#on
failed to pay t#e loan and t#at Bay#on e$ecuted a dacion en pao in #is
favor" T#e t&o cases &ere consolidated" T#e RT! up#eld Bay#on,s
liability to ?enato" Bay#on 'respondents( appealed" :e died &#ile t#e
case &as pendin before t#e !+" T#e !+ #eld t#at t#e dacion en pao
&as void and t#at &#ile t#e loan &as valid, t#e deat# of Bay#on
e$tinuis#ed it"
ISSUE! @CN t#e obliation to pay t#e principal loan and interest
contracted by Bay#on &as e$tinuis#ed by #is deat#" NO"
HELD! +s a eneral rule, obliations derived from a contract are
transmissible e$cept &#ere t#ey are not transmissible by t#eir nature, or
by stipulation or by provision of la&" T#e #eir is not liable beyond t#e
value of t#e property #e received from t#e decedent" '+rt" 0100, par"0,
!!(" @#ile t#e responsibility of t#e #eirs for t#e debts of t#eir decedent
cannot e$ceed t#e value of t#e in#eritance t#ey receive from #im, t#e
principle remains intact t#at t#ese #eirs succeed not only to t#e ri#ts of
t#e deceased but also to #is obliations" '+rt" 443
E
W 442
9
, !!("
T#e rule is a conse9uence of t#e proressive RdepersonaliHationR of
patrimonial ri#ts and duties" ;rom t#e Roman concept of a relation
from person to person, t#e obliation #as evolved into a relation from
patrimony to patrimony, &it# t#e persons occupyin only a
representative position, barrin t#ose rare cases &#ere t#e obliation is
strictly personal, i"e", is contracted intuitu personae, in consideration of
its performance by a specific person and by no ot#er" T#e transition is
mar)ed by t#e disappearance of t#e imprisonment for debt" '<state of
Hemady v. $u/on &urety Co.( @#ile t#e deceased may no loner be
compelled to pay t#e loan, t#e debt subsists aainst #is estate" No
property or portion of t#e in#eritance may be transmitted to #is #eirs
unless t#e debt #as first been satisfied"
8 Succession is a mode of acquisition by virtue of which the property,
rihts and ob!iations to the e"tent of the va!ue of the inheritance, of
a person are transmitted throuh his death to another or others either
by his wi!! or by operation of !aw#
$ %he inheritance inc!udes a!! the property, rihts and ob!iations of a
person which are not e"tinuished by his death#
Att'. T. S&-.&+or : 00 : BDG ; SY 1<10
T#e procedure in vindicatin monetary claims involvin a defendant &#o
dies before final 5udment is overned by Rule 1, Sec" 86
06
" Petitioner,s
remedy lies in filin a claim aainst t#e estate of t#e deceased
respondent"
16) S"o#$$ A-(#r& .. LGU o% t) 4it' o% N&(&
*octrine- %f t#e applicant for e$emption meets t#e salary and property
re9uirements under Section 09 of Rule 030, t#en t#e rant of t#e
application is mandatory" On t#e ot#er #and, &#en t#e application does
not satisfy one or bot# re9uirements, t#en t#e application s#ould not be
denied outri#t. instead, t#e court s#ould apply t#e Lindiency testM
under Section 80 of Rule 1 and use its sound discretion in determinin
t#e merits of t#e prayer for e$emption"
;acts- T#e spouses filed a complaint for damaes from t#e alleed
demolition of t#eir residence and boardin #ouse" T#ey also filed a
Motion to <itiate as %ndient <itiants, s#o&in a ross mont#ly income
of around 06), and a net pay of around 1"2)" T#ey also #ad a
certification s#o&in t#at t#ey #ad no property" T#ey ranted t#e plea for
e$emption from filin fees" +s a result of t#e demolition, t#e +luras
alleedly lost a mont#ly income of 4)"
Naa t#en filed an +ns&er &it# !ounterclaim, sayin t#at it &as a
nuisance per se" Naa filed a Motion to *is9ualify for Non7payment of
;ilin ;ees, sayin t#at +lura &as a police, and t#e &ife #ad a mini7
store and a computer s#op" T#ey &ere sayin t#at t#ey &eren,t indient
litiants" RT! dis9ualified t#em as indient litiants, and directed t#em
to pay filin fees"
1& 'hen the action is for recovery of money arisin from contract,
e"press or imp!ied, and the defendant dies before entry of (na!
)udment in the court in which the action was pendin at the time of
such death, it sha!! not be dismissed but sha!! instead be a!!owed to
continue unti! entry of (na! )udment# * favorab!e )udment obtained
by the p!ainti+ therein sha!! be enforced in the manner especia!!y
provided in these ,u!es for prosecutin c!aims aainst the estate of a
deceased person#
T#ey submitted re9uirements, under Rule 030, Section 0E, to support
t#eir claim as indient litiants" S#e said t#at t#ey only relied on t#e
#usband,s 1"2) salary, toet#er &it# t#eir 2 minor c#ildren" T#e RT! still
denied"
Pude Barsaa said t#at t#e pay slip &as O>ER t#e amount of Rule
030, Section 0E 'ross income s#ould not e$ceed 1) a mont#, no real
estate above 56)(" RT! said t#ere &as no alleation in t#e affidavit t#at
t#e &ife and t#e family didn,t earn a ross income of 1)"
%ssue- @CN t#ey s#ould be considered as indient litiants &#o 9ualify
for e$emption from payin of filin fees
:eld- YES" +n indient party is one who has no money or property
sufficient, and availa*le for food, shelter, and *asic necessities for
himself and his family.
+t t#e time t#e rules &ere amended, t#ere &as no amendment made on
Rule 030, Section 02, on pauper litiants"
T#e rule on pauper litiants &as inserted in Rule 030 &it#out revo)in or
amendin Section 80 of Rule 1, &#ic# provides for t#e e$emption" So
t#ere &ere 8 rules on pauper litiants- Rule 1, Sec" 80, and Rule 030,
Sec" 0E"
+mendments to Rule 030, Sec" 09- 1) outside M"Mla, 3) in M"Mla Z
Ma$imum value of property, 56) assessed to ma$imum value of 166)"
T#e 8 rules can stand toet#er" @#en t#e application to litiate as
indient is filed, t#e court s#all see if it complies &it# Rule 030, Sec" 09
't#e ross income, and t#e property(" %f t#e applicants meet suc#, t#e
rant is a matter of ri#t, and it s#ould automatically be ranted"
B/T if t#e trial court finds t#at one or bot# re9uirements #aven,t been
met, it &ould set a #earin to enable applicant to prove t#at #e #as Xno
money or property sufficient and available for food, s#elter and basic
necessities for #imself and #is family"M %f after t#e #earin t#e court
determines t#at #e #as sufficient income or property, #e s#all be
assessed t#e proper fees" But if t#e !ourt finds out t#at #e doesn,t #ave
sufficient means for basic needs, t#e !ourt, in its discretion, s#ould
rant t#e application to litiate as indient litiants"
Att'. T. S&-.&+or : 08 : BDG ; SY 1<10
%nstead of dis9ualifyin t#e +luras, t#e court s#ould #ave called a
#earin as re9uired by Rule 1, Sec" 80" To enable t#em to adduce
evidence to s#o& t#at t#ey didn,t #ave property or money"
Att'. T. S&-.&+or : 09 : BDG ; SY 1<10

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