QUEZON CITY vs.

ABS-CBN BROADCASTING CORPORATION - Local Franchise Tax

FACTS:
ABS-CBN was granted a franchise which provides that it shall pay a 3% franchise tax and the
said percentage tax shall be in lieu of all taxes on this franchise or earnings thereof. It thus
filed a complaint against the imposition of local franchise tax.

ISSUE:
Whether or not the dismissal by the CA on the petitioners appeal is in order

because it raised purely legal issues

HELD:

Obviously, these are purely legal questions, cognizable by this Court, to the
exclusion of all other courts. There is a question of law when the doubt or
difference arises as to what the law is pertaining to a certain state of facts.[16]
Section 2, Rule 50 of the Rules of Court provides that an appeal taken to the
CA under Rule 41 raising only questions of law is erroneous and shall be
dismissed, issues of pure law not being within its jurisdiction. [17] Consequently, the
dismissal by the CA of petitioners appeal was in order.
In the recent case of Sevilleno v. Carilo,[18] this Court ruled that the dismissal
of the appeal of petitioner was valid, considering the issues raised there were pure
questions of law, viz.:
Petitioners interposed an appeal to the Court of Appeals but it was
dismissed for being the wrong mode of appeal. The appellate court held
that since the issue being raised is whether the RTChas jurisdiction over
the subject matter of the case, which is a question of law, the appeal
should have been elevated to the Supreme Court under Rule 45 of the
1997 Rules of Civil Procedure, as amended. Section 2, Rule 41 of the
same Rules which governs appeals from judgments and final orders of
the RTC to the Court of Appeals, provides:

SEC. 2. Modes of appeal.

(a) Ordinary appeal. The appeal to the Court of Appeals in

cases decided by the Regional Trial Court in the
exercise of its original jurisdiction shall be taken
by filing a notice of appeal with the court which
rendered the judgment or final order appealed from and
serving a copy thereof upon the adverse party. No
record on appeal shall be required except in special
proceedings and other cases of multiple or separate
appeals where the law or these Rules so require. In
such cases, the record on appeal shall be filed and
served in like manner.
(b) Petition for review. The appeal to the Court of Appeals
in cases decided by the Regional Trial Court in the
exercise of its appellate jurisdiction shall be by petition
for review in accordance with Rule 42.
(c) Appeal by certiorari. In all cases where only questions
of law are raised or involved, the appeal shall be to the
Supreme Court by petition for review on certiorari in
accordance with Rule 45.
In Macawili Gold Mining and Development Co., Inc. v. Court of
Appeals, we summarized the rule on appeals as follows:
(1) In all cases decided by the RTC in the exercise of its
original jurisdiction, appeal may be made to the Court
of Appeals by mere notice of appeal where the
appellant raises questions of fact or mixed questions of
fact and law;
(2) In all cases decided by the RTC in the exercise of its
original jurisdiction where the appellant raises only
questions of law, the appeal must be taken to the
Supreme Court on a petition for review on certiorari
under Rule 45;
(3) All appeals from judgments rendered by the RTC in the
exercise of its appellate jurisdiction, regardless of
whether the appellant raises questions of fact, questions
of law, or mixed questions of fact and law, shall be

brought to the Court of Appeals by filing a petition for

review under Rule 42.
It is not disputed that the issue brought by petitioners to the Court
of Appeals involves the jurisdiction of the RTC over the subject matter
of the case. We have a long standing rule that a courts jurisdiction over
the subject matter of an action is conferred only by the Constitution or
by statute. Otherwise put, jurisdiction of a court over the subject matter
of the action is a matter of law. Consequently, issues which deal with the
jurisdiction of a court over the subject matter of a case are pure questions
of law. As petitioners appeal solely involves a question of law, they
should have directly taken their appeal to this Court by filing a petition
for review on certiorari under Rule 45, not an ordinary appeal with the
Court of Appeals under Rule 41. Clearly, the appellate court did not err
in holding that petitioners pursued the wrong mode of appeal.

Indeed, the Court of Appeals did not err in dismissing petitioners

appeal. Section 2, Rule 50 of the same Rules provides that an appeal
from the RTC to the Court of Appeals raising only questions of law shall
be dismissed; and that an appeal erroneously taken to the Court of
Appeals shall be dismissed outright, x x x.[19] (Emphasis added)

However, to serve the demands of substantial justice and equity, the Court
opts to relax procedural rules and rule upon on the merits of the case. In Ong Lim
Sing Jr. v. FEB Leasing and Finance Corporation,[20] this Court stated:
Courts have the prerogative to relax procedural rules of even the most
mandatory character, mindful of the duty to reconcile both the need to
speedily put an end to litigation and the parties right to due process. In
numerous cases, this Court has allowed liberal construction of the rules
when to do so would serve the demands of substantial justice and
equity. In Aguam v. Court of Appeals, the Court explained:
The court has the discretion to dismiss or not to
dismiss an appellants appeal. It is a power conferred on the
court, not a duty. The discretion must be a sound one, to be
exercised in accordance with the tenets of justice and fair
play, having in mind the circumstances obtaining in each

case. Technicalities, however, must be avoided. The law

abhors technicalities that impede the cause of justice. The
courts primary duty is to render or dispense justice. A
litigation is not a game of technicalities. Lawsuits unlike
duels are not to be won by a rapiers thrust. Technicality,
when it deserts its proper office as an aid to justice and
becomes its great hindrance and chief enemy, deserves
scant consideration from courts. Litigations must be
decided on their merits and not on technicality. Every party
litigant must be afforded the amplest opportunity for the
proper and just determination of his cause, free from the
unacceptable plea of technicalities. Thus, dismissal of
appeals purely on technical grounds is frowned upon where
the policy of the court is to encourage hearings of appeals
on their merits and the rules of procedure ought not to be
applied in a very rigid, technical sense; rules of procedure
are used only to help secure, not override substantial
justice. It is a far better and more prudent course of action
for the court to excuse a technical lapse and afford the
parties a review of the case on appeal to attain the ends of
justice rather than dispose of the case on technicality and
cause a grave injustice to the parties, giving a false
impression of speedy disposal of cases while actually
resulting in more delay, if not a miscarriage of justice. [21]

Larena vs. Mapili

The Case
Before us is a Petition for Review [1] under Rule 45 of the Rules of Court, challenging the
July 21, 2000 Decision[2] and the November 8, 2000 Resolution [3] of the Court of Appeals (CA)
in CA-GR No. 44927. The dispositive portion of the assailed Decision reads as follows:
WHEREFORE, foregoing premises considered, the appeal, devoid of merit in fact and in law is
hereby ordered DISMISSED, and the judgment of the Trial Court AFFIRMED IN TOTO, with
costs against [petitioners].[4]
The assailed Resolution denied petitioners Motion for Reconsideration.
The Facts
The appellate court, quoting the Decision[5] of the Regional Trial Court (RTC) of Dumaguete
City (Branch 30), summarized the facts of the case as follows:
The record shows that Hipolito Mapili during his lifetime owned a parcel of unregistered land
situated at Balabag, Valencia, Negros Oriental which was declared for taxation purposes in his
name under Tax Declaration No. 1419 described as follows:
A parcel of unregistered land situated at Balabag, Valencia, Negros Oriental. Bounded on the
North by Apolonia Mapili 37.00; on the South by the Provincial Road 41.00; on the East by
Perfecto Ozoa 11.00; on the West by Emeliana 16.40. Containing an area of Five Hundred Thirty
Four (534) square meters more or less.
Hipolito Mapili died and was buried on July 14, 1934. He was survived by his only son, Magno
Mapili and daughters Julia, Azucena, Anatolia and Abundia. These daughters have since died
without issue.Magno Mapili died in 1944 survived by his widow, Rosela Veneles, and children
Fructuosa, Jose, Generosa and Pantaleona.
Under date of October 28, 1949, Filomena[6] Larena executed an Affidavit of Transfer of Real
Property involving the property covered by Tax Declaration No. 1419, alleging that she bought
the property from Hipolito Mapili. After the death of Filomena, Aquila Larena, her niece[,] took
possession of the property[,] claiming that she bought the same from her said aunt.
Plaintiffs Fructuosa Mapili, Jose Mapili and Rosela Veneles are suing Aquila Larena, the
successor in interest of Filomena Larena[,] impleading Candido Mercadera, Aquilas husband,
[as] co-defendant.Defendants Generosa Mapili-Bahandi and Pantaleona Mapili, sisters of
[p]laintiffs[,] were impleaded as co-defendants for being unwilling co-plaintiffs. Defendant Rural
Bank of Valencia, Inc.[7] was also sued as the banking institution from [which] defendant Aquila
Larena obtained a loan using OCT No. FV-30714 of the property in question as collateral.

Plaintiffs [C]omplaint alleged that Filomena Larena falsely stated in her Affidavit of Transfer of
Real Property (Exh. B) that Hipolito Mapili sold the property to her on October 28, 1949[,]
which Hipolito Mapili could not have done because he was already dead at that time (Exhibit C).
Defendants Answer contends that Filomena Larena lawfully acquired the said property from
Hipolito Mapili in a private document of sale which got lost during the last World War. By
reason of the sale, Magno Mapili and his family had to move out of the land [allowing]
[8]
Filomena Larena to take possession thereof as owner. Filomena Larena then sold the property
to defendant Aquila Larena on February 17, 1968. Defendant Aquila Larena [attributed the
statement in Filomenas affidavit][9] that she purchased the land from Hipolito Mapili on October
28, 1949 to a mistake committed by the one who assisted her in executing said transferors
affidavit.[10] (Citations omitted)
Ruling of the Court of Appeals
In dismissing petitioners appeal, the CA declared that respondents had never lost their right
to the land in question, as they were the heirs to whom the property had descended upon the
death of the original claimant and possessor. It also found no legal justification for the
application of prescription and laches.
Hence this Petition.[11]
The Issues
1 - Did Felomina Larena, the predecessor of petitioner Aquila Larena, buy the property
in question from its original owner Hipolito Mapili?
2 - Is the lot in question now owned by Petitioner Aquila Larena by virtue of the joint
operation of the principles of acquisitive prescription and laches?[12]
There is really only one issue: Did Filomena (or Felomina) Larena acquire the subject
property by means of sale, prescription and/or laches?
The Courts Ruling
The Petition is unmeritorious. The short answer to the above question is No.

Bases Conversion & Development Authority vs. Uy

The Case
Petitioners, through a Joint Petition for Review on Certiorari with Prayer for the Issuance of a
Writ of Preliminary Injunction and/or a Temporary Restraining Order 4 under Rule 45 of the
Rules of Court, assail the July 31, 2000 Decision5 of the Court of Appeals (CA) which dismissed
petitioners prayer for the issuance of writs of certiorari and prohibition in CA-G.R. SP No.
56418 entitled The Bases Conversion Development Authority, et al. v. Hon. Helen BautistaRicafort, Presiding Judge, RTC Paraaque, Branch 260, and Elpidio Uy, doing business under
the name and style of Edison Development and Construction.
The Facts
On March 13, 1992, Republic Act No. 7227,6 otherwise known as "The Bases Conversion and
Development Act of 1992," created the BCDA to "accelerate the sound and balanced conversion
into alternative productive uses of the Clark and Subic military reservations and their extension
(John Hay Station, Wallace Air Station, ODonnell Transmitter Station, San Miguel Naval
Communications Station and Capas Relay Station)," 7 and "to raise funds by the sale of portions
of Metro Manila military camps."8 Pursuant to this Act, then President Ramos issued Executive
Order (EO) No. 40,9 series of 1992, specifying, among others, the portions of Metro Manila
military camps to be utilized to generate capital for the BCDA. For Fort Bonifacio, 96 hectares
was set aside for the subject Heritage Park Project (the Project).
To carry out the Project and other fund generating projects pursuant to RA 7227 and EO 40, the
BCDA entered into a Memorandum of Agreement (MOA) with the Public Estates Authority
(PEA), designating the latter as Project Manager. Thereafter, on September 9, 1994, the BCDA,
PEA, and the Philippine National Bank (PNB) executed a Pool Formation Trust Agreement
(PFTA), creating an asset pool to generate funds for the development of the Project.10
On November 20, 1996, after the requisite public bidding, the PEA entered into a Landscaping
and Construction Agreement11 (LCA) with respondent Elpidio Uy, doing business under the
name and style of Edison Development and Construction. Subsequent to the LCA, the same
parties forged on August 5, 1997 a negotiated Construction Agreement. On December 3, 1996,
respondent received the requisite Notice to Proceed12 from PEA, and duly mobilized within 14
days from notice and commenced the landscaping and construction of the Project. The LCA
stipulated that respondent shall fulfill his contractual obligation within a period of 450 calendar

days from its start, reckoned 14 days from respondents receipt of the notice to
proceed.13 Specifically, the scope of respondent Uys work in the LCA was to construct three (3)
vertical structures, the Terrasoleum structures, and the landscaping.
Aside from respondent, two other contractors were engaged in the ProjectMakati Development
Corporation (MDC) undertook the horizontal site development and Romago Electric, Inc. (REI)
which was contracted to do the electrification of the Project. The parties presented diametrically
opposing versions on its progress. Nonetheless, it is undisputed that there were delays in the
construction and landscaping under the LCA, and for which several extensions were granted to
respondent Uy by PEA.
On the one hand, respondent asserted that the delays were justified and not attributable to him, as
portions of the Project were delivered piecemeal and could not be worked on immediately
pending the completion of work by the other contractors. On the other hand, petitioners
maintained that respondent Uy was in delay with work "slippage" beyond tolerable levels and
that respondent had already pulled out his equipment and machineries, and stopped working
sometime in October 1999.
On November 29, 1999, respondent Uy received from PEA a Letter of Termination 14 of the LCA.
This prompted respondent to file Civil Case No. 99-0425 for Injunction and Damages with the
Paraaque Regional Trial Court (RTC) Branch 260 against PEA, petitioner BCDA, and private
petitioners. On December 14, 1999, Paraaque RTC Executive Judge Helen Bautista-Ricafort
issued a 72hour Temporary Restraining Order (TRO), enjoining petitioners from excluding
respondent from his contractual obligations under the LCA. 15 Subsequently, the case was raffled
to the same Judge in the said trial court, who, on December 17, 1999, after the preliminary
hearing of the case, extended the TRO for 17 days.16
On December 27, 1999, petitioners who were not joined by PEA forthwith filed their Joint
Petition for Certiorari and Prohibition17 before the CA. Alleging facts falling under the
exceptions on filing a motion for reconsideration, said petition raised the sole issue of lack of
jurisdiction of the RTC to hear an injunction case against the BCDA and the propriety of the
issuance of the TRO in view of the proscription under Section 21 of RA 7227.
Petitioners argued that the said proviso not only prohibits lower courts from issuing a TRO or
writ of injunction against BCDA projects but also clearly vests exclusive jurisdiction in this
Court for injunctive relief and issuance of a TRO. Moreover, petitioners maintained that PD 1818
and the recent RA No. 8975 (both laws prohibit courts from issuing TRO and preliminary
injunctions in cases involving infrastructure projects of the government) were equally applicable.
Meanwhile, on December 28, 1999, the Paraaque RTC issued an Order suspending proceedings
until the final resolution of the certiorari case before the appellate court.

The Ruling of the Court of Appeals

On July 31, 2000, the CA rendered a Decision18 dismissing petitioners Joint Petition for
Certiorari and Prohibition. The CA reasoned that the assailed TRO had become functus officio,
thus, it was moot and academic. Nonetheless, it held that the RTC did not commit grave abuse of
discretion in issuing the assailed TRO and that prohibition was not a proper remedy. It
ratiocinated that if petitioners want to stop the proceedings in the RTC for alleged manifest bias
of the sitting judge, they should have filed a motion for inhibition before the trial court. In short,
the CA ruled that the RTC was the proper venue to hear the injunction casethereby ruling that
the RTC had jurisdiction to hear the injunctive case and to issue the TRO.
The Issues
Without filing a motion for reconsideration, on August 7, 2000, petitioners came before this
Court filing their Joint Petition for Review on Certiorari under Rule 45 on pure questions of law,
raising the same sole issue of jurisdiction of the RTC to hear an injunctive case and to issue a
TRO against the BCDA.
Furthermore, petitioners raise the following issues for our consideration:
I
UNDER R.A. NO. 7227, THE IMPLEMENTATION OF PROJECTS FOR THE
CONVERSION OF MILITARY BASES INTO PRODUCTIVE USES SHALL NOT BE
RESTRAINED OR ENJOINED EXCEPT BY AN ORDER OF THE SUPREME
COURT, HENCE, THE LOWER COURT HAS NO JURISDICTION TO HEAR AND
DECIDE CIVIL CASE NO. 99-0425.
II
IN DISMISSING THE JOINT PETITION FOR CERTIORARI AND PROHIBITION IN
CA-G.R. SP NO. 56418 QUESTIONING SQUARELY THE LOWER COURTS
JURISDICTION OVER CIVIL CASE NO. 99-0425, THE APPELLATE COURT WENT
BEYOND THE ISSUES RAISED IN THE PLEADINGS AND TOOK UP MATTERS
EXTRANEOUS TO THE CASE.
III
IF THE RESPONDENT HAS ANY CLAIM HE WANTS TO PURSUE BEFORE THE
LOWER COURTS, THE RELIEF AVAILABLE TO THE RESPONDENT IS LIMITED
TO A CASE FOR DAMAGES, NOT INJUNCTION, AGAINST THE PETITIONERS
TO ENFORCE SUCH CLAIM.19

The Courts Ruling

The instant case arose from the termination by the PEA of the LCA which respondent Uy is
contesting through an injunction case. As we see it, the core issue for our resolution is whether
the trial court has jurisdiction to provisionally enjoin petitioners from terminating the LCA and to
hear an injunction case against petitioners. On the other hand, respondent Uy aside from
countering the issues presented by petitioners, also raised several procedural issues for the
disallowance of the instant petition.
Preliminary Issues: Procedural Issues
At the outset, we tackle the three (3) procedural issues raised by respondent Uy in his September
6, 2000 Comment20 to bolster his position that the petition should be dismissed. Respondent
contends that the petition ought to be dismissed outright as petitioners did not file a motion for
reconsideration from the assailed CA Decision, an alleged pre-requisite before this Court can
entertain petitions under Rule 45. Respondent citesYbaez v. Court of Appeals,21 Tan v. Court of
Appeals,22 Villarama v. NLRC,23 Mactan Cebu International Airport Authority v. Court of
Appeals,24 and Sunshine Transportation, Inc. v. NLRC25 as authorities. Moreover, respondent Uy
maintains that the verification and certification of non-forum shopping was defective as only one
of the petitioners affixed his signature, (Ramon P. Ereneta) and such sole signatory cannot
represent petitioner BCDA as no Board Resolution was presented conferring such authority.
Lastly, said respondent asserts that there is no proper joinder of parties considering that the major
issue raised by petitioner BCDA is its invocation of RA 7227.
Motion for reconsideration not required in Rule 45 as condition precedent
We find the aforesaid arguments of respondent Uy tenuous and untenable. Rule 45 does not
require the prior filing of a motion for reconsideration for this Court to take cognizance of
appeals through petitions for review on certiorari. This can be gleaned from Sections 1 and 2 of
Rule 45 which pertinently provides:
SECTION 1. Filing of petition with Supreme Court. A party desiring to appeal by certiorari
from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the
Regional Trial Court or other courts whenever authorized by law, may file with the Supreme
Court a verified petition for review on certiorari. The petition shall raise only questions of law
which must be distinctly set forth.
SEC. 2. Time for filing; extension. The petition shall be filed within fifteen (15) days from
notice of the judgment or final order or resolution appealed from, or of the denial of the
petitioners motion for new trial or reconsideration filed in due time after notice of the judgment
(emphasis supplied). On motion duly filed and served, with full payment of the docket and other

lawful fees and the deposit for costs before the expiration of the reglementary period, the
Supreme Court may[,] for justifiable reasons[,] grant an extension of thirty (30) days only within
which to file the petition.
The foregoing provisos clearly do not require the filing of a motion for reconsideration as a
condition precedent unlike certiorari under Rule 65. Moreover, as aptly noted by petitioners, the
cases26 cited by respondent Uy are not applicable in the instant case as they pertain to certiorari
under Rule 65an original action for certiorari, which requires a motion for reconsideration as a
condition precedent. It must be noted that while both Rules 45 and 65 are petitions for certiorari,
the former is a petition for review while the latter is an original special civil action for certiorari.
Signature of a principal party sufficient for verification and certification
Anent the assailed verification and certification of non-forum shopping, it is shown that it
substantially complied with the requirements of the Rules. Dismissal of appeals that is purely on
technical grounds is frowned upon.27While only petitioner Ramon P. Ereneta signed the
verification and certification of non-forum shopping such is not fatal to the instant petition.
In Calo,28 we agreed with petitioners that the signature of only one petitioner in the verification
and certification of non-forum shopping satisfies the requirement under Section 2, Rule 42 of the
Revised Rules on Civil Procedure.29 In Calo, we relied on Condo Suite Club Travel, Inc., v.
NLRC30 where we ruled that the certification of non-forum shopping may be signed not only
by the petitioners but also any of the principal parties. In the instant case, Mr. Ramon P. Erenta, a
member of the Investment Committee of the Heritage Park Management Corporation, is a
principal party in the instant case having been impleaded in Civil Case No. 99-0425 pending in
the RTC.
More so, in Calo, we also cited Cavile, et al. v. Heirs of Clarita Cavile, et. al. 31 where we held
that there was substantial compliance with the Rules when only petitioner Thomas George
Cavile, Sr. signed in behalf of all the other petitioners of the certificate of non-forum shopping as
the petitioners, being relatives and co-owners of the properties in dispute, shared a common
interest in them, had a common defense in the complaint for partition, and filed the petition as a
collective, raising only one argument to defend their rights over the properties in question. We
reasoned that there was sufficient basis for Cavile, Sr., to speak for and in behalf of his copetitioners, stating that they had not filed any action or claim involving the same issues in
another court or tribunal, nor was there other pending action or claim in another court or tribunal
involving the same issues. In the same vein, this is also true in the instant case where petitioners
have filed their petition as a collective, sharing a common interest and having a common single
defense.
Anent the lack of a BCDA Board Resolution authorizing Ramon P. Ereneta, such defect has been
substantially complied with by the subsequent filing of a Letter of Authority 32 to represent and

sign pleadings for and on behalf of BCDA in the instant case. In Jaro v. Court of Appeals, we had
occasion to cite "ample jurisprudence holding that the subsequent and substantial compliance of
an appellant may call for the relaxation of the rules of procedure." 33 At any rate, this petty
technicality deserves scant consideration where the question at issue is one purely of law and
there is no need to delve into the veracity of the allegations in the petition. As we have held time
and again, imperfections of form and technicalities of procedure are to be disregarded, except
where substantial rights would otherwise be prejudiced.
There is proper joinder of parties
As regards the issue of non-joinder of parties, we find respondents argument tenuous and quite
drawn out. Respondent maintains that petitioners have no legal personality to pursue this appeal
on the strenuous interpretation that the BCDA and other petitioners cannot invoke Sec. 21 of RA
7227 as only the Office of the Solicitor General (OSG) can invoke such defense. Verily, having
impleaded petitioners in the civil case he filed before the trial court, respondent Uy cannot
anymore question the locus standi of petitioners. Moreover, the invocation of Sec. 21 of RA
7227 was already made in the trial court during the December 17, 1999 hearing and it was duly
raised before the CA on certiorari under Rule 65. This is a common defense invoked by
petitioners at the outset. Moreover, it is not only the OSG who has the right and privilege to
invoke provisions of the law pertaining to Government Owned and Controlled Corporations
(GOCC). In fact, it is the Office of the Government Corporate Counsel (OGCC) who appears for
GOCC and not the OSG.34