SECOND DIVISION

[G.R. NO. 140608. September 23, 2004]

PERMANENT SAVINGS AND LOAN BANK, petitioner, vs. MARIANO VELARDE, respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
In a complaint for sum of money filed before the Regional Trial Court of Manila (Branch 37), docketed as Civil Case No.
94-71639, petitioner Permanent Savings and Loan Bank sought to recover from respondent Mariano Velarde, the sum of
P1,000,000.00 plus accrued interests and penalties, based on a loan obtained by respondent from petitioner bank,
evidenced by the following: (1) promissory note dated September 28, 1983; (2) loan release sheet dated September 28,
1983; and (3) loan disclosure statement dated September 28, 1983. Petitioner bank, represented by its Deputy Liquidator
after it was placed under liquidation, sent a letter of demand to respondent on July 27, 1988, demanding full payment of
the loan. Despite receipt of said demand letter, respondent failed to settle his account. Another letter of demand was sent
on February 22, 1994, and this time, respondents counsel replied, stating that the obligation is not actually existing but
covered by contemporaneous or subsequent agreement between the parties
In his Answer, respondent disclaims any liability on the instrument, thus:
2. The allegations in par. 2, Complaint, on the existence of the alleged loan of P1-Million, and the purported documents
evidencing the same, only the signature appearing at the back of the promissory note, Annex A seems to be that of herein
defendant. However, as to any liability arising therefrom, the receipt of the said amount of P1-Million shows that the
amount was received by another person, not the herein defendant. Hence, no liability attaches and as further stated in the
special and affirmative defenses that, assuming the promissory note exists, it does not bind much less is there the
intention by the parties to bind the herein defendant. In other words, the documents relative to the loan do not express the
true intention of the parties.
Respondents Answer also contained a denial under oath, which reads:
I, MARIANO Z. VELARDE, of age, am the defendant in this case, that I caused the preparation of the complaint and that
all the allegations thereat are true and correct; that the promissory note sued upon, assuming that it exists and bears the
genuine signature of herein defendant, the same does not bind him and that it did not truly express the real intention of
the parties as stated in the defenses;
During pre-trial, the issues were defined as follows:
1. Whether or not the defendant has an outstanding loan obligation granted by the plaintiff;
2. Whether or not the defendant is obligated to pay the loan including interests and attorneys fees;
3. Whether or not the defendant has really executed the Promissory Note considering the doubt as to the genuineness of
the signature and as well as the non-receipt of the said amount;
4. Whether or not the obligation has prescribed on account of the lapse of time from date of execution and demand for
enforcement; and
5. Whether or not the defendant is entitled to his counterclaim and other damages.
On September 6, 1995, petitioner bank presented its sole witness, Antonio Marquez, the Assistant Department Manager of
the Philippine Deposit Insurance Corporation (PDIC) and the designated Deputy Liquidator for petitioner bank, who
identified the Promissory Note dated September 28, 1983, the Loan Release Sheet dated September 28, 1983, and the
Disclosure Statement of Loan Credit Transaction.
After petitioner bank rested its case, respondent, instead of presenting evidence, filed with leave of court his demurrer to
evidence, alleging the grounds that:

(a)

PLAINTIFF FAILED TO PROVE ITS CASE BY PREPONDERANCE OF EVIDENCE.

(b)
THE CAUSE OF ACTION, CONCLUDING ARGUENTI THAT IT EXISTS, IS BARRED BY PRESCRIPTION
AND/OR LACHES.
The trial court, in its Decision dated January 26, 1996, found merit in respondents demurrer to evidence and dismissed
the complaint including respondents counterclaims, without pronouncement as to costs.
On appeal, the Court of Appeals agreed with the trial court and affirmed the dismissal of the complaint in its Decision
dated October 27, 1999. The appellate court found that petitioner failed to present any evidence to prove the existence of
respondents alleged loan obligations, considering that respondent denied petitioners allegations in its complaint. It also
found that petitioner banks cause of action is already barred by prescription.
Hence, the present petition for review on certiorari under Rule 45 of the Rules Court, with the following assignment of
errors:
4.1
THE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER FAILED TO ESTABLISH THE GENUINENESS,
DUE EXECUTION AND AUTHENTICITY OF THE SUBJECT LOAN DOCUMENTS.
4.2
THE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONERS CAUSE OF ACTION IS ALREADY BARRED BY
PRESCRIPTION AND OR LACHES.
Before going into the merits of the petition, the Court finds it necessary to reiterate the well-settled rule that only
questions of law may be raised in a petition for review on certiorari under Rule 45 of the Rules of Court, as the Supreme
Court is not a trier of facts. It is not our function to review, examine and evaluate or weigh the probative value of the
evidence presented.
There are, however, exceptions to the rule, e.g., when the factual inferences of the appellate court are manifestly mistaken;
the judgment is based on a misapprehension of facts; or the CA manifestly overlooked certain relevant and undisputed
facts that, if properly considered, would justify a different legal conclusion. This case falls under said exceptions.
The pertinent rule on actionable documents is found in Rule 8, Section 7 of the Rules of Court which provides that when
the cause of action is anchored on a document, the genuineness or due execution of the instrument shall be deemed
impliedly admitted unless the defendant, under oath, specifically denies them, and sets forth what he claims to be the
facts.
It was the trial courts opinion that:
The mere presentation of supposed documents regarding the loan, but absent the testimony of a competent witness to the
transaction and the documentary evidence, coupled with the denial of liability by the defendant does not suffice to meet
the requisite preponderance of evidence in civil cases. The documents, standing alone, unsupported by independent
evidence of their existence, have no legal basis to stand on. They are not competent evidence. Such failure leaves this Court
without ample basis to sustain the plaintiffs cause of action and other reliefs prayed for. The loan document being
challenged. (sic) Plaintiff did not exert additional effort to strengthen its case by the required preponderance of evidence.
On this score, the suit must be dismissed.
The Court of Appeals concurred with the trial courts finding and affirmed the dismissal of the complaint, viz.:
The bank should have presented at least a single witness qualified to testify on the existence and execution of the
documents it relied upon to prove the disputed loan obligations of Velarde. This falls short of the requirement that
(B)efore any private writing may be received in evidence, its due execution and authenticity must be proved either: (a)
By anyone who saw the writing executed; (b) By evidence of the genuineness of the handwriting of the maker; or (c) By
a subscribing witness. (Rule 132, Sec. 21, Rules of Court)

It is not true, as the Bank claims, that there is no need to prove the loan and its supporting papers as Velarde has already
admitted these. Velarde had in fact denied these in his responsive pleading. And consistent with his denial, he objected to
the presentation of Marquez as a witness to identify the Exhibits of the Bank, and objected to their admission when these
were offered as evidence. Though these were grudgingly admitted anyway, still admissibility of evidence should not be
equated with weight of evidence.
A reading of respondents Answer, however, shows that respondent did not specifically deny that he signed the loan
documents. What he merely stated in his Answer was that the signature appearing at the back of the promissory note
seems to be his. Respondent also denied any liability on the promissory note as he allegedly did not receive the amount
stated therein, and the loan documents do not express the true intention of the parties. Respondent reiterated these
allegations in his denial under oath, stating that the promissory note sued upon, assuming that it exists and bears the
genuine signature of herein defendant, the same does not bind him and that it did not truly express the real intention of
the parties as stated in the defenses
Respondents denials do not constitute an effective specific denial as contemplated by law. In the early case of Songco vs.
Sellner, the Court expounded on how to deny the genuineness and due execution of an actionable document, viz.:
This means that the defendant must declare under oath that he did not sign the document or that it is otherwise false or
fabricated. Neither does the statement of the answer to the effect that the instrument was procured by fraudulent
representation raise any issue as to its genuineness or due execution. On the contrary such a plea is an admission both of
the genuineness and due execution thereof, since it seeks to avoid the instrument upon a ground not affecting either.
In fact, respondents allegations amount to an implied admission of the due execution and genuineness of the promissory
note. The admission of the genuineness and due execution of a document means that the party whose signature it bears
admits that he voluntarily signed the document or it was signed by another for him and with his authority; that at the time
it was signed it was in words and figures exactly as set out in the pleading of the party relying upon it; that the document
was delivered; and that any formalities required by law, such as a seal, an acknowledgment, or revenue stamp, which it
lacks, are waived by him. Also, it effectively eliminated any defense relating to the authenticity and due execution of the
document, e.g., that the document was spurious, counterfeit, or of different import on its face as the one executed by the
parties; or that the signatures appearing thereon were forgeries; or that the signatures were unauthorized.
Clearly, both the trial court and the Court of Appeals erred in concluding that respondent specifically denied petitioners
allegations regarding the loan documents, as respondents Answer shows that he failed to specifically deny under oath the
genuineness and due execution of the promissory note and its concomitant documents. Therefore, respondent is deemed
to have admitted the loan documents and acknowledged his obligation with petitioner; and with respondents implied
admission, it was not necessary for petitioner to present further evidence to establish the due execution and authenticity of
the loan documents sued upon.
While Section 22, Rule 132 of the Rules of Court requires that private documents be proved of their due execution and
authenticity before they can be received in evidence, i.e., presentation and examination of witnesses to testify on this fact;
in the present case, there is no need for proof of execution and authenticity with respect to the loan documents because of
respondents implied admission thereof.
Respondent claims that he did not receive the net proceeds in the amount of P988,333.00 as stated in the Loan Release
Sheet dated September 23, 1983. The document, however, bears respondents signature as borrower. Res ipsa loquitur.
The document speaks for itself. Respondent has already impliedly admitted the genuineness and due execution of the loan
documents. No further proof is necessary to show that he undertook the obligation with petitioner. A person cannot accept
and reject the same instrument.
The Court also finds that petitioners claim is not barred by prescription.
Petitioners action for collection of a sum of money was based on a written contract and prescribes after ten years from the
time its right of action arose. The prescriptive period is interrupted when there is a written extrajudicial demand by the
creditors. The interruption of the prescriptive period by written extrajudicial demand means that the said period would
commence anew from the receipt of the demand.
Thus, in the case of The Overseas Bank of Manila vs. Geraldez, the Court categorically stated that the correct meaning of
interruption as distinguished from mere suspension or tolling of the prescriptive period is that said period would
commence anew from the receipt of the demand. In said case, the respondents Valenton and Juan, on February 16, 1966,
obtained a credit accommodation from the Overseas Bank of Manila in the amount of P150,000.00. Written extrajudicial

demands dated February 9, March 1 and 27, 1968, November 13 and December 8, 1975 and February 7 and August 27,
1976 were made upon the respondents but they refused to pay. When the bank filed a case for the recovery of said amount,
the trial court dismissed the same on the ground of prescription as the bank's cause of action accrued on February 16, 1966
(the date of the manager's check for P150,000.00 issued by the plaintiff bank to the Republic Bank) and the complaint was
filed only on October 22, 1976. Reversing the ruling of the trial court, the Court ruled:
An action upon a written contract must be brought within ten years from the time the right of action accrues (Art. 1144[1],
Civil Code). "The prescription of actions is interrupted when they are filed before the court, when there is a written
extrajudicial demand by the creditors, and when there is any written acknowledgment of the debt by the debtor" (Art.
1155, Ibid, applied in Gonzalo Puyat & Sons, Inc. vs. City of Manila, 117 Phil. 985, 993; Philippine National Bank vs.
Fernandez, L-20086, July 10, 1967, 20 SCRA 645, 648; Harden vs. Harden, L-22174, July 21, 1967, 20 SCRA 706, 711).
A written extrajudicial demand wipes out the period that has already elapsed and starts anew the prescriptive period.
Giorgi says: "La interrupcion difiere de la suspension porque borra el tiempo transcurrido anteriormente y obliga a la
prescripcion a comenzar de nuevo" (9 Teoria de las Obligaciones, 2nd Ed., p. 222). "La interrupcion . . . quita toda eficacia
al tiempo pasado y abre camino a un computo totalmente nuevo, que parte del ultimo momento del acto interruptivo,
precisamente, como si en aquel momento y no antes hubiese nacido el credito" (8 Giorgi, ibid pp. 390-2).
That same view as to the meaning of interruption was adopted in Florendo vs. Organo, 90 Phil. 483, 488, where it ruled
that the interruption of the ten-year prescriptive period through a judicial demand means that "the full period of
prescription commenced to run anew upon the cessation of the suspension". "When prescription is interrupted by a
judicial demand, the full time for the prescription must be reckoned from the cessation of the interruption" (Spring vs.
Barr, 120 So. 256 cited in 54 C.J.S. 293, note 27). That rule was followed in Nator and Talon vs. CIR, 114 Phil. 661, Sagucio
vs. Bulos, 115 Phil. 786 and Fulton Insurance Co. vs. Manila Railroad Company, L-24263, November 18, 1967, 21 SCRA
974, 981.
Interruption of the prescriptive period as meaning renewal of the original term seems to be the basis of the ruling in
Ramos vs. Condez, L-22072, August 30, 1967, 20 SCRA 1146, 1151. In that case the cause of action accrued on June 25,
1952. There was a written acknowledgment by the vendors on November 10, 1956 of the validity of the deed of sale.
In National Marketing Corporation vs. Marquez, L-25553, January 31, 1969, 26 SCRA 722, it appears that Gabino
Marquez executed on June 24, 1950 a promissory note wherein he bound himself to pay to the Namarco P12,000 in
installments within the one-year period starting on June 24, 1951 and ending on June 25, 1952. After making partial
payments on July 7, 1951 and February 23, 1952, Marquez defaulted.
His total obligation, including interest, as of October 31, 1964, amounted to P19,990.91. Written demands for the payment
of the obligation were made upon Marquez and his surety on March 22, 1956, February 16, 1963, June 10, September 18
and October 13, 1964. Marquez did not make any further payment.
The Namarco sued Marquez and his surety on December 16, 1964. They contended that the action had prescribed because
the ten-year period for suing on the note expired on June 25, 1962. That contention was not sustained. It was held that the
prescriptive period was interrupted by the written demands, copies of which were furnished the surety.
Respondents obligation under the promissory note became due and demandable on October 13, 1983. On July 27, 1988,
petitioners counsel made a written demand for petitioner to settle his obligation. From the time respondents obligation
became due and demandable on October 13, 1983, up to the time the demand was made, only 4 years, 9 months and 14
days had elapsed. The prescriptive period then commenced anew when respondent received the demand letter on August
5, 1988. Thus, when petitioner sent another demand letter on February 22, 1994, the action still had not yet prescribed as
only 5 years, 6 months and 17 days had lapsed. While the records do not show when respondent received the second
demand letter, nevertheless, it is still apparent that petitioner had the right to institute the complaint on September 14,
1994, as it was filed before the lapse of the ten-year prescriptive period.
Lastly, if a demurrer to evidence is granted but on appeal the order of dismissal is reversed, the movant shall be deemed to
have waived the right to present evidence. The movant who presents a demurrer to the plaintiffs evidence retains the right
to present their own evidence, if the trial court disagrees with them; if the trial court agrees with them, but on appeal, the
appellate court disagrees with both of them and reverses the dismissal order, the defendants lose the right to present their
own evidence. The appellate court shall, in addition, resolve the case and render judgment on the merits, inasmuch as a
demurrer aims to discourage prolonged litigations. Thus, respondent may no longer offer proof to establish that he has no
liability under the loan documents sued upon by petitioner.

The promissory note signed and admitted by respondent provides for the loan amount of P1,000,000.00, to mature on
October 13, 1983, with interest at the rate of 25% per annum. The note also provides for a penalty charge of 24% per
annum of the amount due and unpaid, and 25% attorneys fees. Hence, respondent should be held liable for these sums.
WHEREFORE, the petition is GRANTED. The Decisions of the Regional Trial Court of Manila (Branch 37) dated
January 26, 1996, and the Court of Appeals dated October 27, 1999 are SET ASIDE. Respondent is ordered to pay One
Million Pesos (P1,000,000.00) plus 25% interest and 24% penalty charge per annum beginning October 13, 1983 until
fully paid, and 25% of the amount due as attorneys fees.
Costs against respondent.
SO ORDERED.
Puno, (Chairman), Callejo, Sr., and Tinga, JJ., concur.
Chico-Nazario, J., on leave.

FIRST DIVISION
[G.R. No. 147793. December 11, 2003]
BOAZ INTERNATIONAL TRADING CORPORATION and F. R. CEMENT CORPORATION, petitioners, vs. WOODWARD
JAPAN, INC. and NORTH FRONT SHIPPING SERVICES, INC., respondents.
DECISION
PANGANIBAN, J.:
The liberal construction of the Rules of Court is resorted to only to promote substantial justice, not to delay or undermine
legal processes. The Rules are designed to assure the orderly and predictable course of justice. Unduly relaxing them
would be an injustice to the innocent parties who honor and obey them, and unfairly reward those who neglect or fail to
follow them.
The Case
Before us is a Petition for Review under Rule 45 of the Rules of Court, assailing the January 18, 2001 Decision and the
April 2, 2001 Resolution of the Court of Appeals (CA) in CA-GR SP No. 56848. We quote the decretal portion of the
Decision:
WHEREFORE, premises considered, the Order dated 09 August 1999 is MODIFIED in the sense that the third-party
complaint of Boaz International Trading Corp. and F. R. Cement Corp. against North Front Shipping Services, Inc. must
be as it is hereby reinstated. In all other respects, the Order is AFFIRMED. Finally, the writ of preliminary injunction
issued by this Court on 29 June 2000 is perforce dissolved.
The assailed Resolution denied petitioners Motion for Reconsideration.
On the other hand, the dispositive portion of the August 9, 1999 Order of the Regional Trial Court (RTC) of Makati City
(Branch 135), which the CA later modified, reads as follows:
WHEREFORE, premises considered, Order is hereby issued:
1.

Reinstating plaintiffs complaint and allowing plaintiff to present its evidence on its complaint;

2.
Allowing plaintiff to refute and/or present evidence against the ex-parte evidence presented by defendants on
their counterclaim.

The Facts
The facts of the case are summarized by the CA as follows:
Respondent Woodward Japan, Inc. (Woodward, for brevity) filed a complaint for a Sum of Money and Damages against
petitioners Boaz International Trading Corp. (Boaz, for brevity) and F. R. Cement Corp. (F. R. Cement, for brevity). The
complaint, docketed as Civil Case No. 96-1440, was raffled to the RTC of Makati, Branch 135, presided over by public
respondent Judge Francisco B. Ibay.
Petitioners Boaz and F. R. Cement filed their [A]nswer to the complaint as well as a third party complaint against North
Front Shipping Services, Inc. (North Front[,] for brevity).
Respondent North Front filed its answer to the third-party complaint with a counterclaim against the third-party
plaintiffs.
The court a quo scheduled a pre-trial conference for 04 November 1997. This initial pre-trial conference was however
postponed to give the parties time to settle their respective claims amicably. Succeeding schedules of pre-trial conference
were likewise cancelled for the same reason. Finally, when it became apparent that the parties would not be able to arrive
at an amicable settlement, the trial court scheduled a pre-trial conference anew for 20 October 1998.
On the scheduled day of the pre-trial conference, both Woodward and its counsel failed to appear. Consequently, counsel
for Boaz and F. R. Cement moved that Woodward be declared non-suited, that the complaint against them be dismissed
and that they be allowed to present evidence on their counterclaim.
Third-party defendant North Front likewise filed a motion to dismiss the third-party complaint which was not objected to
by third-party plaintiffs Boaz and F. R. Cement.
In an Order dated 20 October 1998, the court a quo granted the motion of Boaz and F. R. Cement to dismiss the complaint
of Woodward and the motion of North Front to dismiss the third-party complaint of Boaz and F. R. Cement.
Counsel for Woodward thereafter filed an urgent ex-parte motion 1) to reconsider the Order of 20 October 1998, 2) to set
aside the same Order allowing Boaz and F. R. Cement to present their evidence ex parte and 3) to allow Woodward to
present its evidence. Petitioners Boaz and F. R. Cement filed their opposition thereto.
In an Order dated 16 February 1999, Woodwards urgent ex[-]parte motion was denied for being filed out of time.
On 28 April 1998, Boaz and F. R. Cement presented their evidence consisting of the testimony of one Jose Ernesto
Rodriguez and reserved the right to present the original of certain documents. No formal offer of evidence has yet been
made by Boaz and F. R. Cement.
On 25 June 1999, Woodward filed a Motion to Reinstate Plaintiffs (Woodwards) Complaint and Allow Them to Present
Evidence Ex-Parte. In support of its motion, Woodward attached the affidavit of Atty. Pierre M. Alcantara, as associate
lawyer of the law firm of Belo, Gozon, Parel, Asuncion and Lucila Law Office which handled Woodwards case in the court
a quo. The affidavit of Atty. Alcantara explained the circumstances why Woodward was not represented in the pre-trial
conference on 20 October 1998. The affidavit likewise contains Atty. Alcantaras tacit admission of his neglect to fully
protect the interests of Woodward.
Boaz and F. R. Cement filed their opposition to Woodwards motion to which Woodward filed a reply.
In an Order dated 9 August 1999, the trial court granted Woodwards Motion to Reinstate Plaintiffs (Woodwards)
Complaint and Allow Them to Present Evidence Ex-Parte, x x x
xxx

xxx

xxx

Boaz and F. R. Cement moved for reconsideration but the trial court in its Order of 12 November 1999 denied the same.
Imputing grave abuse of discretion on the part of the trial court, petitioners elevated the case to the CA under Rule 65.
Ruling of the Court of Appeals

In prosecuting the claim of Woodward against petitioners, its lawyers acted negligently, according to the CAs ruling, which
we quote:
As admitted by Atty. Pierre M. Alcantara in his affidavit which was appended to Woodwards motion to reinstate
complaint, a high fever prevented him from attending the pre-trial conference scheduled on 20 October 1998. This fact
was made known to the handling lawyer, Atty. Jonel S. Mercado. However, no action was taken by Atty. Mercado to assign
a substitute counsel for the pre-trial conference. Consequently, Woodward was declared non-suited and its complaint
against Boaz and F. R. Cement was dismissed. To compound the initial neglect of the two lawyers, neither of them had
seen fit to take appropriate action to protect their clients interest. While Atty. Alcantara filed a motion for reconsideration,
the same was filed out of time, hence, denied by the trial court. Worse, both Attys. Alcantara and Mercado failed to inform
the handling partner, Atty. Enrique Belo, and most of all, the client Woodward of the status of the case a quo.
Consequently, the order of dismissal attained finality leaving Woodward no option but to file the motion to reinstate its
complaint.
However, the appellate court further ruled that [c]ounsels gross negligence should not be allowed to deprive Woodward of
a chance to prove its claim as this would amount to injustice and outright deprivation of property. It further held that
when the court a quo granted Woodwards motion to reinstate the complaint, it in effect amended, in the interest of justice,
its previous order declaring Woodward non-suited. All considered, the CA found that the trial court did not act without or
in excess of jurisdiction or with grave abuse of discretion when it reinstated Woodwards Complaint.
Hence, this Petition.
The Issues
Petitioners raise the following issues for our consideration:
Whether or not the Court of Appeals erred in ruling that Judge Ibay acted within the ambit of his jurisdiction and without
grave abuse of discretion when he granted Woodwards Motion To Reinstate Complaint.
Whether or not Judge Ibay acted without or in excess of his jurisdiction or with grave abuse of discretion amounting to
lack or excess of jurisdiction in ordering the reinstatement of the complaint in Civil Case No. 96-1440.
-Whether or not Woodward was bound by the negligence of its counsel
-Whether or not the appearance of the parties at the pre-trial conference is mandatory.
-Whether or not Woodwards consistent failure to observe the provisions of the Rules of Court should be
considered fatal to its cause.
-Whether or not the reinstatement of Woodwards Complaint had any legal basis.
-Whether or not Judge Ibay already lost jurisdiction to amend, modify, reverse or set aside his dismissal
order dated 20 October 1998 on 10 November 1998.
The main issue to be resolved is whether the CA erred in sustaining the RTCs Order reinstating the Complaint of
Woodward.
The Courts Ruling
The Petition has merit.
Main Issue:
Reinstatement of the Complaint
On October 20, 1998, Woodward and its counsel failed to appear for a pretrial conference in Civil Case No. 96-1440.
Hence, on motion of petitioners, its Complaint was dismissed in an Order issued on the same day. Respondent Woodward
filed a Motion for Reconsideration of the Order on November 12, 1998, 17 days after it received a copy thereof. The trial
court denied the Motion for being filed out of time.

On June 25, 1999, more than seven (7) months after the finality of the November 12, 1998 Order, Woodward filed a
Motion to Reinstate [its] Complaint and Allow [it] to Present Evidence. This Motion was granted by the RTC in its August
9, 1999 Order.
Jurisdiction of the RTC to Reverse
Its October 20, 1998 Order
Indisputably, the August 9, 1999 Order reversed the one issued on October 20, 1998, which, as early as November 15,
1998, was already final as to Woodward. This reversal cannot be countenanced. When the dismissal of an order attains
finality through the lapse of the 15-day reglementary period, the issuing court loses jurisdiction and control over that
order, and it can no longer make any disposition inconsistent with its dismissal. Upon the finality of the dismissal, the
court has no more power to amend, modify, reverse or set aside the order.
Legal Basis of the Motion
Reinstating the Complaint
The Motion to Reinstate Complaint asked the trial court to reverse or reconsider its Order dismissing the Complaint.
Hence, this Motion was in reality Woodwards second motion for reconsideration, as it was filed months after the denial of
its first one. Section 5 of Rule 37 explicitly states that [n]o party shall be allowed a second motion for reconsideration of a
judgment or final order. Clearly, Woodwards Motion to Reinstate its Complaint was not sanctioned by the Rules of Court
or the law.
Liberal Interpretation
of the Rules of Court
Respondent Woodward pushes for a liberal interpretation of the Rules of Court. It insists that the emerging trend in our
jurisprudence is to afford all litigants the amplest opportunity for the proper and just determination of their cause, free
from the constraints of technicalities.
Indeed, espoused by jurisprudence and the Rules is liberal interpretation which, however, is geared towards the
attainment of a certain goal: a just, speedy and inexpensive disposition of every action and proceeding. Respondent
Woodward has failed to show how a liberal construction of the Rules, which it violated with impunity, would result in the
attainment of that goal. On the other hand, there are a number of reasons that justify the disallowance of such
interpretation in the present case.
Pretrial
First, the rules on pretrial were designed precisely to secure the just, speedy and inexpensive disposition of an action. The
parties themselves -- not only their counsels -- are required to be present, so that they can discuss and possibly agree on a
settlement and thus end the case justly, speedily and inexpensively right there and then. The Rules explicitly impose upon
the former the duty to appear at the pretrial conference. The representative of Woodward, as well as its counsel, failed to
do so on the date set for the purpose -- not just on October 20, 1998, but also earlier, on September 17, 1998. By its
unexplained nonappearance, it inexcusably delayed the case and even caused added expense to the opposing party who
had come to court in obedience to the Rules. Evidently, the RTCs October 20, 1998 Order dismissing the case was proper
and in accord with Section 5 of Rule 18, which provides that [t]he failure of the plaintiff to appear [for pretrial] shall be
cause for dismissal of the action.
Procedural Rules
Second, after violating the rules on pretrial, Woodward had the temerity to file a Motion for Reconsideration beyond the
15-day reglementary period, again in violation of the Rules. Then, upon denial of that Motion, instead of properly elevating
the denial to the appellate court for review, it filed a Motion to Reinstate Complaint. As previously explained, the latter
Motion amounted to a second motion for reconsideration, which is prohibited by the Rules. By its acts, Woodward
unnecessarily delayed the disposition of the case and caused additional expenses to all involved. Furthermore, such acts
indicate a propensity to violate the Rules or a gross ignorance thereof, either of which deserves nothing less than
opprobrium.
Negligence of Counsel

Third, the CA did not err in finding negligence on the part of the counsel of Woodward, which is nonetheless bound by
such negligence. Settled [is the] rule that the negligence of counsel binds the client. We find no cogent reason to depart
from this settled rule, especially because the counsels negligence in the present case has not been sufficiently explained.
To cater to the pleas of Woodward and to reinstate its Complaint would put a premium on negligence and thus encourage
the non-termination of this case. Like all other clients, Respondent Woodward is bound by the acts of its counsel in the
conduct of a case and has to bear with the consequences thereof. It cannot thereafter be heard to complain that the result
might have been different had its counsel proceeded differently. The rationale for the rule is easily discernible. If the
negligence of counsel be admitted as a reason for opening a case, there would never be an end to litigation so long as there
is a new counsel to be hired every time it is shown that the prior one had not been sufficiently diligent, experienced or
learned.
Merit of Respondents
Collection Case
Fourth, Respondent Woodward has failed to demonstrate that it has a meritorious case. It filed a collection case against
Petitioner Boaz International Trading Corp. (hereinafter referred to as Boaz) for demurrage charges in the total sum of
US$75,065.96. Yet it has failed to show prima facie any agreement on the payment of demurrages. The April 18, 1995
Letter, which Woodward unilaterally made and which Petitioner Boaz did not sign, does not show that the latter agreed to
pay demurrages of US$6,500/half despatch in case the discharge rate fell below 2,500MT.
Contrary to Woodwards contention, Boaz has not admitted the April 18, 1995 Letter-Agreement. Paragraph 1.8 of the
Answer is not a negative pregnant. Woodward itself states that a negative pregnant is that form of denial which at the
same time involves an affirmative implication favorable to the opposing party. Since the aforementioned paragraph is
explicitly an admission, not a denial, it follows that it cannot be taken as a denial pregnant with an admission of
substantial facts.
To sum up, the trial court gravely abused its discretion in issuing its August 9, 1999 Order, considering that (1) its October
20, 1998 Order was already final; (2) the reinstatement of the Complaint is not in accordance with the Rules of Court or
the law; and (3) there is no justification for liberally construing the Rules in order to serve the ends of justice. Corollary to
this conclusion, the CA erred in affirming the August 9, 1999 Order of the RTC and in ordering the reinstatement of the
third-party Complaint of petitioners against North Front Shipping Services, Inc.
WHEREFORE, the Petition is GRANTED. The August 9, 1999 Order of the trial court is SET ASIDE and NULLIFIED.
No pronouncement as to costs.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Ynares-Santiago, Carpio, and Azcuna, JJ., concur.

SECOND DIVISION
[G.R. No. 142316. November 22, 2001]
FRANCISCO A.G. DE LIANO, ALBERTO O. VILLA-ABRILLE, JR., and SAN MIGUEL CORPORATION, petitioners, vs.
HON. COURT OF APPEALS and BENJAMIN A. TANGO, respondents.
DECISION
DE LEON, JR., J.:
Before us is a petition for review on certiorari praying for the reversal of the Resolution dated June 4, 1999 issued by the
former Fourteenth Division of the Court of Appeals in CA-G.R. CV No. 60460, which dismissed the appeal of herein
petitioners on procedural grounds as well as its Resolution of February 23, 2000 which denied their motion for
reconsideration.
The relevant facts are:

On March 30, 1998, the Regional Trial Court of Quezon City, Branch 227 issued a Decision in Civil Case No. Q-95-24332,
the dispositive portion of which is hereunder quoted:
WHEREFORE, premises considered, defendant San Miguel Corporation is hereby ordered
1.

To release to the plaintiff the owners duplicate copy of TCT No. 299551 in the same [sic] of Benjamin A. Tango;

2.
To release to plaintiff the originals of the REM contracts dated December 4, 1990 and February 17, 1992 and to
cause the cancellation of the annotation of the same on plaintiffs [sic] TCT No. 299551;
3.

To pay the plaintiff the following sums:

3.1.

P100,000.00 as and by way of moral damages;

3.2.

P50,000.00 as and by way of attorneys fees;

3.3.

costs of suit.

SO ORDERED.
In brief, the case involved the cancellation of two (2) real estate mortgages in favor of petitioner San Miguel Corporation
(SMC) executed by private respondent Benjamin A. Tango over his house and lot in Quezon City. The mortgages were
third party or accommodation mortgages on behalf of the spouses Bernardino and Carmelita Ibarra who were dealers of
SMC products in Aparri, Cagayan. Other defendants in the case were Francisco A.G. De Liano and Alberto O. Villa-Abrille,
Jr., who are senior executives of petitioner SMC.
SMC, De Liano and Abrille appealed the aforesaid decision to the Court of Appeals. In due time, their counsel, Atty. Edgar
B. Afable, filed an Appellants Brief which failed to comply with Section 13, Rule 44 of the Rules of Court. The appellee
(herein private respondent) was quick to notice these deficiencies, and accordingly filed a Motion to Dismiss Appeal dated
March 8, 1999. Required to comment, the appellants averred that their brief had substantially complied with the contents
as set forth in the rules. They proffered the excuse that the omissions were only the result of oversight or inadvertence and
as such could be considered harmless errors. They prayed for liberality in the application of technical rules, adding that
they have a meritorious defense.
On June 4, 1999, the appellate court issued the first assailed resolution dismissing the appeal. The Court of Appeals held,
as follows:
xxx

xxx

xxx

As pointed out by plaintiff-appellee, the Brief does not contain a Subject Index nor a Table of Cases and Authorities, with
page references. Moreover, the Statement of the Case, Statement of Facts, and Arguments in the Brief has no page
reference to the record. These procedural lapses justify the dismissal of the appeal, pursuant to Section 1 (f), Rule 50 of the
1997 Rules of Civil Procedure, as amended, which reads:
SECTION 1. Grounds for dismissal of appeal. An appeal may be dismissed by the Court of Appeals, on its own motion, or
on that of the appellee, on the following grounds:
xxx

xxx

xxx

(f) Absence of specific assignment of errors in the appellants brief, or of page references to the record as required in
section 13, paragraphs (a), (c), (d) and (f) of Rule 44;
xxx

xxx

xxx

Finally, defendants-appellants, despite having been notified of such defects, still failed to amend their Brief to conform to
the Rules, and instead, argues that these are mere harmless errors. In the case of Del Rosario v. Court of Appeals, G.R. No.
113890, February 22, 1996, 241 SCRA 553 [1996], the Supreme Court, in sustaining the dismissal of the petitioners appeal
for non-compliance with the rule on the contents of the Appellants Brief, ruled that:

Long ingrained in our jurisprudence is the rule that the right to appeal is a statutory right and a party who seeks to avail of
the right must faithfully comply with the rules. x x x These rules are designed to facilitate the orderly disposition of
appealed cases. In an age where courts are bedeviled by clogged dockets, these rules need to be followed by appellants with
greater fidelity. Their observance cannot be left to the whims and caprices of appellants. x x x
Having ruled as such, the Court need not resolve plaintiff-appellees contention that the issues raised in the appeal are
mere questions of law.
The appellants (herein petitioners) sought to have the foregoing resolution reconsidered. Simultaneously, through the
same counsel, they filed a Motion to Admit Amended Defendants-Appellants Brief. The appellate court denied the
consolidated motions in its Resolution of February 23, 2000.
From the denial of their motion for reconsideration, only petitioner SMC interposed the instant petition. As grounds for
allowance, petitioner contends that:
A
THE COURT OF APPEALS ERRED IN DISMISSING SMCs APPEAL ON THE BASIS OF PURE TECHNICALITIES
AND EVEN AFTER SMC HAS CORRECTED THE TECHNICAL DEFECT OF ITS APPEAL.
B
THE COURT OF APPEALS ERRED IN DISMISSING SMCs APPEAL WITHOUT CONSIDERING ITS MERITS.
1.
There are valid grounds to reverse the RTCs award of damages in favor of Tango. The award of damages has no
basis in fact or in law.
2.
The appeal involves a question of substance which should have been resolved by the Court of Appeals, to wit:
whether a third party mortgagor can unilaterally withdraw the mortgage without the consent of the debtor and creditor.
The petition has no merit.
The premise that underlies all appeals is that they are merely rights which arise from statute; therefore, they must be
exercised in the manner prescribed by law. It is to this end that rules governing pleadings and practice before appellate
courts were imposed. These rules were designed to assist the appellate court in the accomplishment of its tasks, and
overall, to enhance the orderly administration of justice.
In his definition of a brief, Justice Malcolm explained thus:
xxx[L]et it be recalled that the word brief is derived from the Latin brevis, and the French briefe, and literally means a
short or condensed statement. The purpose of the brief, as all law students and lawyers know, is to present to the court in
concise form the points and questions in controversy, and by fair argument on the facts and law of the case to assist the
court in arriving at a just and proper conclusion. The brief should be so prepared as to minimize the labor of the court in
the examination of the record upon which the appeal is heard and determined. [italics supplied]
Relative thereto, Section 13, Rule 44 of the Revised Rules of Court governs the format to be followed by the appellant in
drafting his brief, as follows:
Contents of appellants brief.The appellants brief shall contain, in the order herein indicated, the following:
(a)
A subject index of the matter in the brief with a digest of the arguments and page references, and a table of cases
alphabetically arranged, textbooks and statutes cited with references to the pages where they are cited;
(b)
An assignment of errors intended to be urged, which errors shall be separately, distinctly and concisely stated
without repetition and numbered consecutively;
(c)
Under the heading Statement of the Case, a clear and concise statement of the nature of the action, a summary of
the proceedings, the appealed rulings and orders of the court, the nature of the judgment and any other matters necessary
to an understanding of the nature of the controversy, with page references to the record;

(d)
Under the heading Statement of Facts, a clear and concise statement in a narrative form of the facts admitted by
both parties and of those in controversy, together with the substance of the proof relating thereto in sufficient detail to
make it clearly intelligible, with page references to the record;
(e)

A clear and concise statement of the issues of fact or law to be submitted to the court for its judgment;

(f)
Under the heading Argument, the appellants arguments on each assignment of error with page references to the
record. The authorities relied upon shall be cited by the page of the report at which the case begins and the page of the
report on which the citation is found;
(g)

Under the heading Relief, a specification of the order or judgment which the appellant seeks; and

(h)
In cases not brought up by record on appeal, the appellants brief shall contain, as an appendix, a copy of the
judgment or final order appealed from.
This particular rule was instituted with reason, and most certainly, it was not intended to become a custom more honored
in the breach than in the observance. It has its logic, which is to present to the appellate court in the most helpful light, the
factual and legal antecedents of a case on appeal.
The first requirement of an appellants brief is a subject index. The index is intended to facilitate the review of appeals by
providing ready reference, functioning much like a table of contents. Unlike in other jurisdictions, there is no limit on the
length of appeal briefs or appeal memoranda filed before appellate courts. The danger of this is the very real possibility
that the reviewing tribunal will be swamped with voluminous documents. This occurs even though the rules consistently
urge the parties to be brief or concise in the drafting of pleadings, briefs, and other papers to be filed in court. The subject
index makes readily available at ones fingertips the subject of the contents of the brief so that the need to thumb through
the brief page after page to locate a partys arguments, or a particular citation, or whatever else needs to be found and
considered, is obviated.
An assignment of errors follows the subject index. It is defined in this wise:
An assignment of errors in appellate procedure is an enumeration by appellant or plaintiff in error of the errors alleged to
have been committed by the court below in the trial of the case upon which he seeks to obtain a reversal of the judgment or
decree; it is in the nature of a pleading, and performs in the appellate court the same office as a declaration or complaint in
a court of original jurisdiction. Such an assignment is appellants complaint, or pleading, in the appellate court, and takes
the place of a declaration or bill; an appeal without an assignment of errors would be similar to a suit without a complaint,
bill, or declaration. The assignment is appellants declaration or complaint against the trial judge, charging harmful error,
and proof vel non of assignment is within the record on appeal.
xxx

xxx

xxx

The object of such pleadings is to point out the specific errors claimed to have been committed by the court below, in order
to enable the reviewing court and the opposing party to see on what points appellant or plaintiff in error intends to ask a
reversal of the judgment or decree, and to limit discussion to those points. The office of an assignment of errors is not to
point out legal contentions, but only to inform the appellate court that appellant assigns as erroneous certain named
rulings; the function of the assignment is to group and bring forward such of the exceptions previously noted in the case
on appeal as appellant desires to preserve and present to the appellant.
It has been held that a general assignment of errors is unacceptable under the rules. Thus, a statement of the following
tenor: that the Court of First Instance of this City incurred error in rendering the judgment appealed from, for it is
contrary to law and the weight of the evidence, was deemed insufficient. The appellant has to specify in what aspect of the
law or the facts that the trial court erred. The conclusion, therefore, is that the appellant must carefully formulate his
assignment of errors. Its importance cannot be underestimated, as Section 8, Rule 51 of the Rules of Court will attest:
Questions that may be decided.No error which does not affect the jurisdiction over the subject matter or the validity of the
judgment appealed from or the proceedings therein will be considered unless stated in the assignment of errors, or closely
related to or dependent on an assigned error and properly argued in the brief, save as the court may pass upon plain errors
and clerical errors.
The rules then require that an appellants brief must contain both a statement of the case and a statement of facts. A
statement of the case gives the appellate tribunal an overview of the judicial antecedents of the case, providing material

information regarding the nature of the controversy, the proceedings before the trial court, the orders and rulings elevated
on appeal, and the judgment itself. These data enable the appellate court to have a better grasp of the matter entrusted to
it for its appraisal.
In turn, the statement of facts comprises the very heart of the appellants brief. The facts constitute the backbone of a legal
argument; they are determinative of the law and jurisprudence applicable to the case, and consequently, will govern the
appropriate relief. Appellants should remember that the Court of Appeals is empowered to review both questions of law
and of facts. Otherwise, where only a pure question of law is involved, appeal would pertain to this Court. An appellant,
therefore, should take care to state the facts accurately though it is permissible to present them in a manner favorable to
one party. The brief must state the facts admitted by the parties, as well as the facts in controversy. To laymen, the
distinction may appear insubstantial, but the difference is clear to the practitioner and the student of law. Facts which are
admitted require no further proof, whereas facts in dispute must be backed by evidence. Relative thereto, the rule
specifically requires that ones statement of facts should be supported by page references to the record. Indeed,
disobedience therewith has been punished by dismissal of the appeal. Page references to the record are not an empty
requirement. If a statement of fact is unaccompanied by a page reference to the record, it may be presumed to be without
support in the record and may be stricken or disregarded altogether.
When the appellant has given an account of the case and of the facts, he is required to state the issues to be considered by
the appellate court. The statement of issues is not to be confused with the assignment of errors: they are not one and the
same, for otherwise, the rules would not require a separate statement for each. The statement of issues puts forth the
questions of fact or law to be resolved by the appellate court. What constitutes a question of fact or one of law should be
clear by now:
At this point, the distinction between a question of fact and a question of law must be clear. As distinguished from a
question of law which exists when the doubt or difference arises as to what the law is on certain state of factsthere is a
question of fact when the doubt or difference arises as to the truth or the falsehood of alleged facts; or when the query
necessarily invites calibration of the whole evidence considering mainly the credibility of witnesses, existence and
relevancy of specific surrounding circumstances, their relation to each other and to the whole and the probabilities of the
situation.
Thereafter, the appellant is required to present his arguments on each assigned error. An appellants arguments go hand in
hand with his assignment of errors, for the former provide the justification supporting his contentions, and in so doing
resolves the issues. It will not do to impute error on the part of the trial court without substantiation. The mere elevation
on appeal of a judgment does not create a presumption that it was rendered in error. The appellant has to show that he is
entitled to the reversal of the judgment appealed, and he cannot do this unless he provides satisfactory reasons for doing
so. It is therefore essential that
xxx [A]s far as possible, the errors and reasons assigned should be supported by a citation of authorities. The failure to do
so has been said to be inexcusable; and, although a point made in the brief is before the court even though no authorities
are cited and may be considered and will be where a proposition of well established law is stated, the court is not required
to search out authorities, but may presume that counsel has found no case after diligent search or that the point has been
waived or abandoned, and need not consider the unsupported errors assigned, and ordinarily will not give consideration
to such errors and reasons unless it is apparent without further research that the assignments of errors presented are well
taken.
In this regard, the rules require that authorities should be cited by the page of the report at which the case begins, as well
as the page of the report where the citation is found. This rule is imposed for the convenience of the appellate court, for
obvious reasons: since authorities relied upon by the parties are checked for accuracy and aptness, they are located more
easily as the appellate court is not bound to peruse volume upon volume, and page after page, of reports.
Lastly, the appellant is required to state, under the appropriate heading, the reliefs prayed for. In so doing, the appellate
court is left in no doubt as to the result desired by the appellant, and act as the circumstances may warrant.
Some may argue that adherence to these formal requirements serves but a meaningless purpose, that these may be
ignored with little risk in the smug certainty that liberality in the application of procedural rules can always be relied upon
to remedy the infirmities. This misses the point. We are not martinets; in appropriate instances, we are prepared to listen
to reason, and to give relief as the circumstances may warrant. However, when the error relates to something so
elementary as to be inexcusable, our discretion becomes nothing more than an exercise in frustration. It comes as an
unpleasant shock to us that the contents of an appellants brief should still be raised as an issue now. There is nothing
arcane or novel about the provisions of Section 13, Rule 44. The rule governing the contents of appellants briefs has
existed since the old Rules of Court, which took effect on July 1, 1940, as well as the Revised Rules of Court, which took

effect on January 1, 1964, until they were superseded by the present 1997 Rules of Civil Procedure. The provisions were
substantially preserved, with few revisions.
An additional circumstance impels us to deny the reinstatement of petitioners appeal. We observed that petitioner
submitted an Amended Appellants Brief to cure the infirmities of the one first filed on its behalf by its lawyer. All things
being equal, we would have been inclined to grant the petition until we realized that the attempt at compliance was, at
most, only a cosmetic procedure. On closer scrutiny, the amended brief was as defective as the first. Where the first brief
lacked an assignment of errors but included a statement of issues, the amended brief suffered a complete reversal: it had
an assignment of errors but no statement of issues. The statement of facts lacked page references to the record, a
deficiency symptomatic of the first. Authorities were cited in an improper manner, that is, the exact page of the report
where the citation was lifted went unspecified. The amended brief did not even follow the prescribed order: the
assignment of errors came after the statement of the case and the statement of facts. No one could be expected to ignore
such glaring errors, as in the case at bar. The half-hearted attempt at submitting a supposedly amended brief only serves
to harden our resolve to demand a strict observance of the rules.
We remind members of the bar that their first duty is to comply with the rules, not to seek exceptions. As was expressed
more recently in Del Rosario v. Court of Appeals, which was rightfully quoted by the appellate court, we ruled that:
Petitioners plea for liberality in applying these rules in preparing Appellants Brief does not deserve any sympathy. Long
ingrained in our jurisprudence is the rule that the right to appeal is a statutory right and a party who seeks to avail of the
right must faithfully comply with the rules. In People v. Marong, we held that deviations from the rules cannot be
tolerated. The rationale for this strict attitude is not difficult to appreciate. These rules are designed to facilitate the
orderly disposition of appealed cases. In an age where courts are bedeviled by clogged dockets, these rules need to be
followed by appellants with greater fidelity. Their observance cannot be left to the whims and caprices of appellants. In
the case at bar, counsel for petitioners had all the opportunity to comply with the above rules. He remained obstinate in
his non-observance even when he sought reconsideration of the ruling of the respondent court dismissing his clients
appeal. Such obstinacy is incongruous with his late plea for liberality in construing the rules on appeal. [italics supplied]
Anent the second issue, it may prove useful to elucidate on the processing of appeals in the Court of Appeals. In so doing,
it will help to explain why the former Fourteenth Division of the appellate court could not look into the merits of the
appeal, as petitioner corporation is urging us to do now.
The Rules of Court prescribe two (2) modes of appeal from decisions of the Regional Trial Courts to the Court of Appeals.
When the trial court decides a case in the exercise of its original jurisdiction, the mode of review is by an ordinary appeal
in accordance with Section 2(a) of Rule 41. In contrast, where the assailed decision was rendered by the trial court in the
exercise of its appellate jurisdiction, the mode of appeal is via a petition for review pursuant to Rule 42. We are more
concerned here about the first mode since the case at bar involves a decision rendered by the Regional Trial Court
exercising its original jurisdiction.
Cases elevated to the Court of Appeals are treated differently depending upon their classification into one of three (3)
categories: appealed civil cases, appealed criminal cases, and special cases. Be it noted that all cases are under the
supervision and control of the members of the Court of Appeals in all stages, from the time of filing until the remand of the
cases to the courts or agencies of origin. Ordinary appealed civil cases undergo two (2) stages. The first stage consists of
completion of the records. The second stage is for study and report, which follows when an appealed case is deemed
submitted for decision, thus:
When case deemed submitted for judgment.A case shall be deemed submitted for judgment:
A. In ordinary appeals.1)
Where no hearing on the merits of the main case is held, upon the filing of the last pleading, brief, or
memorandum required by the Rules or by the court itself, or the expiration of the period for its filing;
2)
Where such a hearing is held, upon its termination or upon the filing of the last pleading or memorandum as may
be required or permitted to be filed by the court, or the expiration of the period for its filing.
xxx

xxx

xxx

At each stage, a separate raffle is held. Thus, a preliminary raffle is held at which time an appealed case is assigned to a
Justice for completion. After completion, when the case is deemed ripe for judgment, a second raffle is conducted to

determine the Justice to whom the case will be assigned for study and report. Each stage is distinct; it may happen that the
Justice to whom the case was initially raffled for completion may not be the same Justice who will write the decision
thereon.
The aforesaid distinction has a bearing on the case at bar. It becomes apparent that the merits of the appeal can only be
looked into during the second stage. The Justice in-charge of completion exceeds his province should he examine the
merits of the case since his function is to oversee completion only. The prerogative of determining the merits of an appeal
pertains properly to the Justice to whom the case is raffled for study and report. The case at bar did not reach the second
stage; it was dismissed during completion stage pursuant to Section 1(f) of Rule 50. Consequently, petitioners contention
that the appellate court should have considered the substance of the appeal prior to dismissing it due to technicalities does
not gain our favor.
Generally, the negligence of counsel binds his client. Actually, Atty. Afable is also an employee of petitioner San Miguel
Corporation. Yet even this detail will not operate in petitioners favor. A corporation, it should be recalled, is an artificial
being whose juridical personality is only a fiction created by law. It can only exercise its powers and transact its business
through the instrumentalities of its board of directors, and through its officers and agents, when authorized by resolution
or its by-laws.
xxx Moreover, x x x a corporate officer or agent may represent and bind the corporation in transactions with third persons
to the extent that authority to do so has been conferred upon him, and this includes powers which have been intentionally
conferred, and also such powers as, in the usual course of the particular business, are incidental to, or may be implied
from, the powers intentionally conferred, powers added by custom and usage, as usually pertaining to the particular
officer or agent, and such apparent powers as the corporation has caused persons dealing with the officer or agent to
believe that it has conferred.
That Atty. Afable was clothed with sufficient authority to bind petitioner SMC is undisputable. Petitioner SMCs board
resolution of May 5, 1999 attests to that. Coupled with the provision of law that a lawyer has authority to bind his client in
taking appeals and in all matters of ordinary judicial procedure, a fortiori then, petitioner SMC must be held bound by the
actuations of its counsel of record, Atty. Afable.
WHEREFORE, the instant petition is hereby DENIED for lack of merit, with cost against petitioner San Miguel
Corporation.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Quisumbing, and Buena, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-40945 November 10, 1986
IGMEDIO AZAJAR, petitioner,
vs.
THE HONORABLE COURT OF APPEALS (Second Division) and CHAM SAMCO & SONS, INC., respondents.

NARVASA, J.:
Petitioner seeks reversal of the Resolution of the respondent Court of Appeals (now Intermediate Appellate Court) dated
March 25, 1975 setting aside the judgment by default rendered against private respondent by the Court of First Instance,

and directing that said respondent be allowed to file its answer to the complaint and after joinder of issues, trial be had
and judgment rendered on the merits.
This case originated from a complaint filed by petitioner Igmedio Azajar against respondent Cham Samco and Sons, Inc.
in the Court of First Instance (now Regional Trial Court) of Camarines Sur. 1 Azajar's claim, briefly, is that he had
purchased from defendant (hereafter referred to simply as Cham Samco), thru the latter's agent, 100 Kegs of nails of
various sizes, specified in one of Cham Samco's printed order forms, and had given to the agent P18,000.00 in fun
payment thereof; but in breach of contract, Cham Samco had offered to deliver only a part of the quantity ordered.
Cham Samco filed a motion to dismiss on two grounds: (1) failure of the complaint to state a cause of action-the
complaint's language indicating not a perfected sale but merely an "offer to buy by plaintiff that was partly accepted by
defendant," and failing to show that as explicitly required by the order form prices had been confirmed by Cham Samco's
"Manila Office," 2 and (2) that venue was improperly laid-Cham Samco's invariable conditions in transactions of this
nature, as Azajar well knew from many such transactions in the past, being that "any legal action thereon must be
instituted in the City of Manila. 3
The motion to dismiss contained a notice addressed to the Clerk of Court reading as follows:
The Clerk of Court
Court of First Instance of Camarines Sur
Naga City
Sir:
Please submit the foregoing motion to the Court for its consideration and resolution immediately upon
receipt thereof.
Makati, Rizal for Naga City, February 4, 1974
(SGD) POLO S.
PANTALEON
Copy furnished:
Atty. Augusta A. Pardalias
Naga City
NF-927 4
It is this notice that has given rise to the controversy at bar.
Contending that such a notice was fatally defective and rendered the Motion to Dismiss incapable of to the period to
answer, Azajar filed a motion dated February 20, 1974 to declare Cham Samco in default, which the Court granted. By
Order dated February 22, 1974 the Court pronounced Cham Samco in default and allowed Azajar to present evidence ex
parte. The Court justified the order of default in the wise:
On February 4, 1974, defendant thru counsel instead of an answer to the complaint, filed a "Motion to
Dismiss" which, in legal contemplation, is not a motion at an because the ."notice" therein is directed to
the Clerk of Court instead of to the party concerned (as required by Section 5, Rule 15 of the Rules of
Court) and is without the requisite notice of time and place of hearing; that a motion "with a notice of
hearing (a) directed to the Clerk of Court not to the parties; and (b) merely stating that the same be
"submitted for resolution of the Honorable Court upon receipt thereof," copy of which motion was duly
furnished to and received by "the adverse counsel is fatally defective and did not toll the running of the
period to appeal" (Cladera v. Sarmiento, 39 SCRA 552). Consequently, inasmuch as the "motion to

dismiss in this case is a mere scrap of paper because it is without the requisite notice of time and place of
hearing (Manakil v. Hevilla, 42 Phil. 81; Roman Catholic Bishop v. Unisan, 44 Phil. 866; Director of Lands
v. Sanz, 45 Phil. 117; and Manila Surety v. Bath, 14 SCRA 435), the filing thereof did not suspend the
running ' of the period to file the required responsive pleading. That from' February 4, 1974 to February
21, 1974, seventeen (17) days had lapsed and defendant failed to file any responsive pleading ... 5
Then on March 30, 1974, the Trial Court rendered judgment by default against defendant Cham Samco ordering it:
... to deliver immediately to the plaintiff the nails mentioned in the Order Form No. 9020 (Exhibit A); (2)
requiring defendant to pay plaintiff the sum of P15,000.00 by way of actual damages, the sum of
P10,000.00 by way of consequential damages, plus interest in both instances, and the additional sum of
P5,000.00, for exemplary damages; (3) ordering defendant to pay plaintiff the sum of P7,500.00 for
attorney's fees and related expenses of litigation; and (4) to pay the costs.
Cham Samco filed a Motion for New Trial on April 9, 1974. It contended that its failure to observe the rules governing
notice of motions was due to excusable negligence, "because the grounds alleged in the Motion to Dismiss were all in such
nature and character that addressed themselves to a motu proprio resolution by the court and thus rendered a hearing
dispensable. 6 It also alleged certain defenses available to it which if duly alleged and proven, would absolve it from any
liability. 7 This motion was denied.
Cham Samco went to the Court of Appeals on certiorari asserting that the trial court acted with grave abuse of discretion
amounting to lack of jurisdiction in declaring it in default and then rendering judgment by default. 8 The petition was
dismissed for lack of merit by the Court of Appeals on November 20, 1974. 9
But on motion for reconsideration seasonably presented, the Court of Appeals reversed itself. By Resolution dated March
25, 1975, 10 it set aside the Trial Court's order of default of February 22, 1974, judgment by default of March 13, 1974, and
Order dated June 4, 1974 denying Cham Samco's motion for new trial, and directed the lower Court to allow Cham Samco
to file its answer to the complaint and upon due joinder of issues, to try and decide the case on the merits.
The Court held that:
... (t)he notice in the motion which was addressed to the clerk of court asking him to submit the motion
for the consideration of the court is a substantial compliance with the provision of section 3 Rule 16 of the
Rules of Court. Verily under the said rule, the Court has the alternative of either hearing the case or
deferring the hearing and determination thereof until the trial on the merits. Thus upon the filing of said
motion the court should have set the motion for hearing or outrightly deny the motion, or otherwise
postpone the hearing until the trial on the ground that the grounds thereof do not appear to be
indubitable. The prompt filing and apparently valid grounds invoked in the motion are not the acts and
declarations of a defaulting party.
... (E)ven assuming that the declaration of default of the petitioner was in order we find that the trial court
committed a grave abuse of discretion when it denied the motion for new trial that was filed by the
petitioner not only on the ground of excusable negligence we have above discussed but also on the ground
that it has a meritorious defense. and
... (E)xcessive damages have been awarded to the private respondent. In addition to ordering the
petitioner to deliver to the private respondent the nails ordered by the latter, the petitioner was also
ordered to pay not only P15,000 actual damages for profits that the private respondent could have earned
but also consequential damages of P10,000 for the unrealized profits that the said earnings and capital of
the plaintiff could have earned, plus interest in both instances, exemplary damages of P5,000 and P7,500
for attorney's fees and related expenses of litigation. Thus for the capital of respondent of P18,100.00 in
the purchase of the nails, the petitioner was ordered to pay damages of a total of P37,500.00, which
including the interest awarded can amount to over P40,000, more than double the value of the said

investment of respondent. Under Section 1, Rule 37 of the Rules of Court award of excessive damages
could be a ground for new trial.
The Court concluded its opinion with the observation that "the ends of justice would be better served in this case if we
brush aside technicality and afford the petitioner its day in court.
It was wrong, of course, for Cham Samco to have failed to set its motion to dismiss for hearing on a specified date and
time. The law explicitly requires that notice of a motion shall be served by the appellant to all parties concerned at least
three (3) days before the hearing thereof, together with a copy of the motion, and of any affidavits and other papers
accompanying it; 11 and that the notice shag be directed to the parties concerned, stating the time and place for the hearing
of the motion. 12 The uniform holding of this Court has been that a failure to comply with the requirement is a fatal flaw. 13
Such notice is required to avoid surprises upon the opposite party and give the latter time to study and meet the
arguments of the motion, as well as to determine or make determinable the time of submission of the motion for
resolution. 14
Cham Samco quite frankly admits its error. It pleads however that under the circumstances the error be not regarded as
irremediable or that it be deemed as constituting excusable negligence, warranting relief. It argues that legal and logical
considerations, which it took to be tenable, caused it to theorize that a hearing on the motion was dispensable. It also
adverts to its position of affirmative defenses in addition to those set out in its motion to dismiss which if ventilated and
established at the trial would absolve it from all liability under the complaint.
Cham Samco's belief that it was not necessary that its motion to dismiss be set for hearing was avowedly engendered by
two factors, namely:
1) the fact that while the Rules of Court "specify the motions which can be heard only with prior service upon adverse
parties, 15 said Rules "do not point out which written motions may be ex parte, preferring, it appears, to leave to the court,
in motions other than those specified, the discretion either to ex parte resolve ... or to call the parties to a hearing ...; 16 and
2) the further fact that its motion to dismiss was based on two grounds on which a hearing was superfluous, the first,
failure of the complaint to state a cause of action, being determinable exclusively from the allegations of the complaint and
no evidence being allowable thereon; and the second, that venue is improperly laid, being resolvable exclusively on the
basis of documents annexed to the motion. 17
These considerations, to be sure, did not erase movant's duty to give notice to the adverse party of the date and time of the
hearing on its motion, the purpose of said notice being, as already stressed, not only to give the latter time to oppose the
motion if so minded, but also to determine the time of its submission for resolution. Without such notice, the occasion
would not arise to determine with reasonable certitude whether and within what time the adverse party would respond to
the motion, and when the motion might already be resolved by the Court. The duty to give that notice is imposed on the
movant, not on the Court.
Withal the reasons for Cham Samco's erroneous notion of the dispensability of a hearing on its motion to dismiss are not
utterly without plausibility. This circumstance, taken together with the fact, found by the Intermediate Appellate Court
and not disputed by petitioner Azajar, that Cham Samco has meritorious defenses which if proven would defeat Azajar's
claim against it, and the eminent desirability more than once stressed by this Court that cases should be determined on
the merits after full opportunity to all parties for ventilation of their causes and defenses, rather than on technicality or
some procedural imperfections, 18 all conduce to concurrence with the Court of Appeals that "the ends of justice would be
better served in this case if we brush aside technicality and afford the petitioner its day in court.
WHEREFORE, the Resolutions of the Court of Appeals appealed from, are affirmed. Costs against petitioner.
SO ORDERED.
Yap (Chairman), Melencio-Herrera, Cruz and Paras, * JJ., concur.

THIRD DIVISION
[A.M. No. RTJ-05-1896. April 29, 2005]
ATTY. JULIUS NERI, complainant, vs. JUDGE JESUS S. DE LA PEA, respondent.
RESOLUTION
CORONA, J.:
This is a case for grave misconduct, gross ignorance of the law and/or incompetence filed by Atty. Julius Z. Neri against
Judge Jesus S. de la Pea. It originated from a civil case for damages filed by Emmanuel Aznar against Citibank (which was
represented by complainant as counsel), docketed as Civil Case No. CEB-16474 and raffled to the Regional Trial Court of
Cebu, Branch XX, presided over by Judge Ferdinand J. Marcos.[1]
Plaintiff Aznar had filed suit due to the alleged blacklisting of his Citibank Preferred Mastercard which, according to him,
was dishonored in several establishments in Singapore and Malaysia while he was on holiday, causing him great
inconvenience and embarrassment. He presented, as evidence, several receipts, plane tickets, a computer print-out
allegedly showing that his card had been declined for being over limit, a statement of account and his lone testimony.[2]
Defendant Citibank presented several documentary exhibits to the effect that Aznars card had not been placed on any hot
list and could not possibly have been blacklisted.[3] After trial, Judge Marcos dismissed the case for lack of merit.[4]
Dissatisfied with the decision, Aznar filed through counsel a motion for reconsideration, with motion to re-raffle the case.
In an order dated September 11, 1998, Acting Presiding Judge Ramon Codilla (who succeeded Marcos), citing the fact that
he was occupied with two (2) salas and the fact that the Presiding Judge who originally penned the decision is a credit card
holder of CITIBANKwhose membership could naturally influence the outcome of this case in favor of the defendant bank,
directed the re-raffling of the case to RTC Cebu Branch X, presided over by respondent Judge Jesus de la Pea.[5]
Respondent then ordered Citibank to file its comment on Aznars motion for reconsideration.[6] Citibank filed its
opposition instead. In an order dated November 25, 1998, respondent granted Aznars motion for reconsideration:
WHEREFORE, the Motion for Reconsideration is hereby GRANTED. The DECISION dated May 29, 1998 is hereby
reconsidered, and consequently, the defendant is hereby condemned liable to pay the following sums of money:
a) P10,000,000.00 as moral damages;
b) P 5,000,000.00 as exemplary damages;
c) P 1,000,000.00 as attorneys fees; and
d) P200,000.00 as litigation expenses.
SO ORDERED.[7]
As a result of the Order, complainant filed this administrative case on July 16, 1999, which was docketed as Control No.
41-99-P. Charging respondent with dishonesty, he alleged that respondent, contrary to his pronouncement in his order,
had rendered his decision without ever having read the transcripts of the case.[8] To support this contention, complainant
presented certifications from the Clerk of Court of Branch XX[9] and the Clerk of Court of the RTC of Cebu City[10] that
the transcripts of the case had remained in their custody and that the respondent never borrowed them all throughout.
Complainant also charged respondent with gross ignorance of the law and/or incompetence. He alleged that respondent
had improperly considered as a business record Aznars computer print-out which in reality did not meet the requisites to
be rightly considered as such. Aznar never testified as to the date and time the subject print-out was encoded, or who

encoded and printed the same, nor did he establish personal knowledge of who prepared the print-out, or whether it was
prepared by one responsible for it in his professional capacity or in the performance of his official duty or in the regular
course of his business. Finally, the person who prepared it did not testify in court or on deposition.
Complainant went on to say that respondents incompetence and dishonesty showed in his failure to appreciate and
evaluate Citibanks extensive documentary evidence which clearly established that it did not blacklist Aznars Mastercard.
Finally, complainant pointed out that the damages respondent awarded to plaintiff Aznar were scandalously exorbitant.
He prayed for respondents dismissal from the service.
On September 3, 1999, respondent filed his comment.[11] He principally contended that, having appealed from his
decision to the Court of Appeals, the complainant should not have filed this administrative case. Respondent decried
complainants case as forum-shopping. In his defense, respondent asserted that he had in fact read the transcripts, having
received copies thereof attached to an ex parte manifestation filed by plaintiff Aznar.[12] He also defended the amount of
damages he awarded by comparing them to those awarded in a 1973 case, with inflation taken into account.
Complainant then filed his reply to the comment,[13] assailing the ex parte manifestation which respondent had
supposedly relied upon in deciding the case. He pointed out that respondent should not have even considered the said
manifestation because Citibank had not been served a copy and it was filed after office hours. He likewise refuted
respondents allegations of forum-shopping and impropriety in filing an administrative case while an appeal was pending.
In his rejoinder, respondent defended his appreciation of the ex parte manifestation. He likewise reiterated his claim that
the administrative complaint should not have been filed with the appeal.[14]
On February 28, 2001, the Second Division of this Court resolved to hold the administrative case in abeyance until the
final resolution of the Court of Appeals of CA-GR CV No. 62554, Aznar v. Citibank. By this time, the case had been redocketed as AM No. 01-1131-RTJ.[15]
On January 8, 2004, the Court of Appeals decided in favor of Citibank, vacating respondents decision and reinstating the
dismissal of the case by Judge Marcos.[16] On June 8, 2004, complainant filed a manifestation, with the Court of Appeals
decision attached, pointing out that this administrative complaint was now ready for resolution.
In a manifestation dated June 14, 2004, respondent prayed for the resolution of the case and once more asked for its
dismissal. He cited the fact that the Court of Appeals decision made no mention of his administrative lapses and that his
decision was an exercise of purely judicial discretion. He also listed the various posts he had held as a Regional Trial Court
judge as well as the commendations he had received from the Honorable Chief Justice. He also pointed out that this
administrative complaint was the only one ever filed against him in all his years of service.[17]
In a memorandum dated August 27, 2004, the Office of the Court Administrator reported its findings.
Because respondent based his assailed order mostly on the ex parte manifestation submitted by the counsel for plaintiff
Aznar, the OCA found him liable for violating Section 4, Rule 13, in relation to Section 5, Rule 15 of the Revised Rules of
Civil Procedure:
(Rule 13)
SEC. 4. Papers required to be filed and served. Every judgment, resolution, order, pleading subsequent to the complaint,
written motion, notice, appearance, demand, offer of judgment or similar papers shall be filed with the court, and served
upon the parties affected.
(Rule 15)
SEC. 4. Hearing of motion. Except for motions which the court may act upon without prejudicing the rights of the
adverse party, every written motion shall be set for hearing by the applicant.

According to the OCA, the fact that plaintiff Aznar had failed to serve a copy of his ex parte manifestation upon Citibank
should have been reason enough for respondent to disregard the same.
Likewise noting the fact that the ex parte manifestation was filed beyond office hours, the OCA found that this created an
idea that there was a covert attempt to favor Aznar. However, citing the absence of substantial evidence, it pointed out that
it should not be presumed that the procedural lapse committed by respondent (was) attended by corrupt motive of
flagrant disregard of the rules. The OCA also considered in respondents favor his defense that he was merely trying to help
decongest the dockets. Finally, the OCA found the charges of gross ignorance of law and incompetence to be without basis,
and found him liable instead for simple misconduct. The OCA recommended a fine of P10,000.
We adopt part of the findings of the Court Administrator.
But we disagree with its finding that the respondent violated both Rules 13 and 15 of the 1997 Revised Rules of Civil
Procedure.
Section 4, Rule 13 requires that adverse parties be served copies of all pleadings and similar papers. Section 4, Rule 15
requires a movant to set his motion for hearing, unless it is one of those which a court can act upon without prejudicing
the rights of the other party. The prevailing doctrine in our jurisdiction is that a motion without a notice of hearing
addressed to the parties is a mere scrap of paper.[18] In Cui v. Judge Madayag,[19] we held that any motion that does not
contain proof of service of notice to the other party is not entitled to judicial cognizance. (Such) motion is nothing but a
(mere) scrap of paper. It is important, however, to note that these doctrines refer exclusively to motions.
The logic for such a requirement is simple: a motion invariably contains a prayer which the movant makes to the court,
which is usually in the interest of the adverse party to oppose. The notice of hearing to the adverse party is therefore a
form of due process; it gives the other party the opportunity to properly vent his opposition to the prayer of the movant. In
keeping with the principles of due process, therefore, a motion which does not afford the adverse party the chance to
oppose it should simply be disregarded. The same principle applies to objections to interrogatories which also require a
notice of hearing like motions under Section 3, Rule 25 of the Rules.[20]
However, the same cannot be said for manifestations which, unless otherwise indicated, are usually made merely for the
information of the court. There is generally nothing to contest or argue; the manifesting party is just making a statement
for the knowledge of the court, such as in this case. There is nothing in either the Rules or in jurisprudence that requires
judges to disregard a manifestation that does not have proof of service.
This is not to say, however, that respondent is off the hook. While it is true that he was under no obligation to disregard
Aznars ex parte manifestation, he should have at least called attention to its irregularity, both by admonishing Aznar and
by informing the adverse party of its filing. That he acted on it indeed, based his decision on it while Citibank was
totally unaware of its existence ran seriously afoul of the precepts of fair play, specially since respondent only mentioned
the document after this administrative case was filed against him. Indeed, there seems to be something gravely amiss in
respondents sense of fairness and righteousness, the primary requisites of a good judge.
Furthermore, we cannot help but find extreme bias and bad intent in respondents award to Aznar of a whopping P16.2
million in damages considering that, not having tried the case himself, the only records he actually read came from no one
else but Aznar himself. By itself, the unconscionable amount of the award evinces indubitable malice on respondents part
and the shady circumstances in which he granted it show that he knowingly rendered a manifestly unjust decision.
As a member of the judiciary, respondents every action is supposed to be beyond reproach and above suspicion. The 2004
Code of Judicial Conduct clearly states that Judges shall avoid impropriety and the appearance of impropriety in all of
their activities.[21] By acting on a document which was sorely defective (for two reasons: failure to serve a copy on the
adverse party and failure to file it during office hours), and by making an egregiously large award of damages in favor of
plaintiff Aznar, he inevitably opened himself up to suspicion of having entered into a dirty, secret deal with Aznar and
thereby severely tarnished the impartiality with which he was at all times supposed to conduct himself.

Given respondents actions, we disagree with the OCAs findings of simple misconduct. Because of the highly anomalous
manner in which respondent rendered his decision, as well as the questionable content of the decision itself, which was
eventually overturned by the Court of Appeals, we find him guilty of knowingly rendering an unjust judgment or order as
determined by a competent court in an appropriate proceeding.
The penalty for this offense ranges from a fine of P20,000, to suspension from three to six months, to dismissal from the
service. In this case, the penalty of suspension for six months is appropriate, with a warning that another such infraction
of this nature will warrant a more severe penalty.
WHEREFORE, Judge JESUS S. DE LA PEA is hereby found GUILTY of knowingly rendering an unjust judgment or
order as determined by a competent court in an appropriate proceeding and is hereby SUSPENDED from office for six
months. Considering the gravity of this offense, he is hereby warned that another infraction of this kind will merit a
penalty beyond mere suspension from public office.
SO ORDERED.
Panganiban, (Chairman), Sandoval-Gutierrez, Carpio-Morales, and Garcia, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
A.M. No. RTJ-04-1886

May 16, 2005

ALFREDO G. BOISER, complainant,

vs.
JUDGE JOSE Y. AGUIRRE, JR., REGIONAL TRIAL COURT, BRANCH 55, HIMAMAYLAN CITY, NEGROS
OCCIDENTAL, respondent.
DECISION
CHICO-NAZARIO, J.:
The instant administrative case arose from the complaint1 of Alfredo G. Boiser filed with the Office of the Court
Administrator (OCA) charging Judge Jose Y. Aguirre, Jr., Regional Trial Court (RTC) of Himamaylan City, Negros
Occidental, Branch 55, with Grave Abuse of Discretion and Gross Ignorance of the Law.
Complainant Alfredo Boiser was the plaintiff in an ejectment case filed before the Municipal Trial Court (MTC) of
Himamaylan City, Negros Occidental. On 11 July 2003, the MTC rendered a decision 2 in favor of complainant, the
dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendant as follows:
1) For the defendant to vacate subject land known as Lot No. 2023 situated at Brgy. Candumarao,
Hinigaran, Negros Occiental, consisting of 5.5536 hectares leased by the plaintiff from Mary Nonasco and
Ofelia Donado, heirs of the registered owners, the late spouses Narciso Gayares and Paz Nava, and to
peacefully turn over possession thereof to the plaintiff;
2) For the defendant to pay plaintiff the amount of P200,000.00 by way of actual damages;

3) For defendant to pay plaintiff attorneys fees in the amount of P10,000.00 plus P1,000.00 as
appearance fee and to pay the cost.
The writ of preliminary injunction issued by the Court is hereby ordered dismissed.
The case was appealed to the RTC of Negros Occidental, Branch 55.
On 15 October 2003, defendant-appellant Salvador Julleza filed a motion to release bond on the ground that the MTC of
Hinigaran, Negros Occidental, in its decision dated 11 July 2003, had already resolved the writ of preliminary injunction
without mentioning the applicants liability.
On 16 October 2003, respondent judge granted the motion.3
Complainant alleged that the issuance by respondent judge of the Order dated 16 October 2003 is indicative of his
ignorance of the law considering that the motion did not state that he was furnished a copy of the motion thereby
depriving him of his right to due process. He also averred that the motion was a mere scrap of paper for failure to state the
time and date of hearing. He further alleged that respondent manifested gross ignorance when he resolved to grant the
motion to release the injunction bond considering that the same was meant to answer for damages that he may suffer due
to defendants continued illegal possession of the land.
On 15 January 2004, the OCA required4 respondent to file his comment.
In his comment5 dated 12 February 2004, respondent judge maintained that the filing of the administrative complaint
against him is hasty and uncalled for. He said there must have been a miscommunication between the complainant and
his counsel because had either of them exerted effort to find out the result of the appealed case, they would have
discovered that he affirmed in toto the decision of the lower court in favor of the complainant.
On 14 April 2004, complainant filed6 a motion to withdraw complaint.
On 3 August 2004, the OCA submitted its recommendation,7 thus:
Respectfully submitted to the Honorable Court our recommendation that this administrative case be REDOCKETED as a regular administrative matter and that respondent Judge Jose Y. Aguirre, Jr., be FINED in the
amount of P21,000.00 for Gross Ignorance of the Law and be STERNLY WARNED that a repetition of the same or
similar acts will be dealt with more severely.
On 17 November 2004, we referred8 the case to Court of Appeals Justice Monina Zenarosa for investigation, report and
investigation. Consequently, the case was scheduled for preliminary conference on 17 February 2005. On the said date,
complainant Alfredo Boiser, with his counsel Atty. Salvador Sabio, and respondent judge appeared. During the
preliminary conference, Atty. Sabio manifested that the complainant had already filed his motion to withdraw the
complaint and was no longer interested in pursuing the case. On the other hand, respondent judge manifested he had
retired from the service as of 01 November 2004 and is now appearing as a private citizen. He further informed the court
that he was submitting the case without further comment as he had already filed his comment to the complaint.
After investigation, Justice Zenarosa submitted her report9 recommending the dismissal of the complaint.
Prefatorily, the Court must reiterate the rule that mere desistance on the part of the complainant does not warrant the
dismissal of an administrative complaint against any member of the bench. The withdrawal of complaints cannot divest
the Court of its jurisdiction nor strip it of its power to determine the veracity of the charges made and to discipline, such as
the results of its investigation may warrant, an erring respondent. The courts interest in the affairs of the judiciary is a
paramount concern that must not know bounds.10
Anent respondents retirement on 01 November 2004, it has been settled that the Court is not ousted of its jurisdiction
over an administrative case by the mere fact that the respondent public official ceases to hold office during the pendency

of respondents case.11 This was expounded in the case of Perez v. Abiera,12 cited in the case of Judge Rolando G. How v.
Teodora Ruiz, et. al.,13 thus:
[T]he jurisdiction that was Ours at the time of the filing of the administrative complaint was not lost by the mere
fact that the respondent public official had ceased to be in office during the pendency of his case. The court retains
its jurisdiction either to pronounce the respondent official innocent of the charges or declare him guilty thereof. A
contrary rule would be fraught with injustices and pregnant with dreadful and dangerous implications. x x x If
only for reasons of public policy, this Court must assert and maintain its jurisdiction over members of the
judiciary and other officials under its supervision and control for acts performed in office which are inimical to the
service and prejudicial to the interests of litigants and the general public. If innocent, respondent official merits
vindication of his name and integrity as he leaves the government which he served well and faithfully; if guilty, he
deserves to receive the corresponding censure and a penalty proper and imposable under the situation.
We shall now discuss respondents liability relative to the lack of notice of hearing and proof of service of the questioned
motion.
The Rules of Court requires that every motion must be set for hearing by the movant, except those motions which the
court may act upon without prejudicing the rights of the adverse party. The notice of hearing must be addressed to all
parties and must specify the time and date of the hearing, with proof of service. Sections 4, 5 and 6 of Rule 15 of the 1997
Rules on Civil Procedure provide:
SECTION 4. Hearing of motion.- Except for motions which the court may act upon without prejudicing the rights
of the adverse party, every written motion shall be set for hearing by the applicant.
Every written motion required to be heard and the notice of the hearing thereof shall be served in such a manner
as to ensure its receipt by the other party at least three (3) days before the date of hearing, unless the court for
good cause sets the hearing on shorter notice.
SEC. 5. Notice of hearing.- The notice of hearing shall be addressed to all parties concerned, and shall specify the
time and date of the hearing which must not be later than ten (10) days after the filing of the motion.
SEC. 6. Proof of service necessary.- No written motion set for hearing shall be acted upon by the court without
proof of service thereof.
It appears that the Motion to Release Bond was defective as it did not have a proper notice of hearing. The date and time
of the hearing were not specified. Neither complainant nor his counsel was furnished a copy thereof. These were never
controverted by respondent judge.
A motion without notice of hearing is pro forma, a mere scrap of paper. It presents no question which the court could
decide. The court has no reason to consider it and the clerk has no right to receive it. The rationale behind the rule is plain:
unless the movant sets the time and place of hearing, the court will be unable to determine whether the adverse party
agrees or objects to the motion, and if he objects, to hear him on his objection, since the rules themselves do not fix any
period within which he may file his reply or opposition. 14 The objective of the rule is to avoid a capricious change of mind
in order to provide due process to both parties and ensure impartiality in the trial. 15
Also, without proof of service to the adverse party, a motion is nothing but an empty formality deserving no judicial
cognizance.16 The rule mandates that the same shall not be acted upon by the court. Proof of service is mandatory. 17
As can be seen the law involved is simple and elementary, lack of conversance therewith constitutes gross ignorance of the
law. Judges are expected to exhibit more than just cursory acquaintance with statutes and procedural laws. They must
know the laws and apply them properly in all good faith. Judicial competence requires no less. 18
Clearly, respondent judge had ignored a fundamental rule. He acted too precipitately in granting defendants motion
despite the absence of the requirements as above prescribed. As a judge, Judge Aguirre is expected to keep abreast of laws

and prevailing jurisprudence.19 Unfamiliarity with the rules is a sign of incompetence. Basic rules must be at the palm of
his hand. A judge must be acquainted with legal norms and precepts as well as with procedural rules. 20 When a judge
displays utter lack of familiarity with the rules, he erodes the confidence of the public in the courts. 21 Ignorance of the law
by a judge can easily be the mainspring of injustice.22
Thus, in the following cases a fine of Five Thousand Pesos was imposed:
1. In Mutilan v. Adiong,23 A.M. No. RTJ-00-1581, 2 July 2002, 383 SCRA 513, the Court found respondent judge
guilty of gross ignorance of the law for granting a motion for garnishment without compliance with the proof of
service and notice of hearing requirements, and was sentenced to pay a fine of Five Thousand (P5,000.00) Pesos
with a stern warning that repetition of the same or similar acts in the future will be dealt with more severely.
2. In Espino v. Salubre,24 the court found respondent judge guilty of gross ignorance of the law and was sentenced
to pay a fine of Five Thousand Pesos (P5,000.00), when respondent judge continued with the investigation and
subsequent issuance of a warrant of arrest against complainant notwithstanding that the records of the case had
been transmitted to the provincial fiscal and an information has already been filed in court.
3. In Josefina M. Villanueva v. MTC Judge Benjamin E. Almazan,25 the court found respondent judge guilty of
gross ignorance of the law and was sentenced to pay a fine of Five Thousand Pesos (P5,000.00), with stern
warning that a repetition of the same or similar act shall be dealt with more severely, when he conducted a
preliminary investigation in a case cognizable by the Municipal Trial Court.
4. In Acting Solicitor General Romeo de la Cruz v. Judge Carlito A. Eisma, RTC, Branch 13, Zamboanga City,26 a
fine of P5,000.00 was imposed on the respondent judge for gross ignorance of the law and abuse of authority, for
preventing the execution of the decision of the RTC, Branch 17, a court of equal rank and jurisdiction.
Ignorance of the law, which everyone is bound to know, excuses no one27 - much more so judges. It is a truism that the life
chosen by a judge as a dispenser of justice is one which is demanding. By virtue of the delicate position which he occupies
in the society, he is duty bound to be the embodiment of competence and integrity.28 Because of this, a judge who is not
knowledgeable of the law which he is obligated to implement will not be able to live up to the judiciarys exacting
standards.29
WHEREFORE, the Court finds Judge Jose Y. Aguirre, Jr., of the Regional Trial Court of Negros Occidental, Branch 55,
guilty of gross ignorance of the law, and hereby imposes on him a fine of FIVE THOUSAND PESOS (P5,000.00) to be
deducted from his retirement benefits.
SO ORDERED.
Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.

EN

BAN C

MA. TERESA H. DE JESUS,

A.M. No. RTJ-05-1921

Complainant,

(Formerly OCA IPI No. 04-1973-RTJ)

Present:

DAVIDE, JR., C.J.

PUNO,
PANGANIBAN,
QUISUMBING,
- versus -

YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
CALLEJO, SR.,
AZCUNA,
TINGA,
CHICO-NAZARIO, and

JUDGE
RENATO
J.
DILAG,
PRESIDING
JUDGE,
REGIONAL
TRIAL
COURT,
BRANCH
73,
OLONGAPO CITY,
Respondent.

GARCIA, JJ.

Promulgated:

September 30, 2005

x------------------------------------------------------------------------------------------------------------x

D E C I S I O N

SANDOVAL-GUTIERREZ, J:

In a complaint[1] dated February 4, 2004 filed with the Office of the Court Administrator (OCA), complainant Maria
Teresa H. De Jesus charged respondent Judge Renato J. Dilag of the Regional Trial Court of Olongapo City, Branch 73,
with gross ignorance of the law, rendering unjust orders, abuse of authority and misuse of court processes.

Complainant alleged inter alia that on August 26, 2002, her husband Wolfgang Heinrich Konrad Harlinghausen
(Harlinghausen) filed a petition for declaration of nullity of their marriage with the Regional Trial Court of Olongapo City,
Branch 73, docketed as Civil Case No. 364-0-2002.

On August 27, 2002, Harlinghausen, through counsel, filed an Urgent Ex-Parte Motion to Preserve Properties to be
Collated. On the same day, respondent judge issued an Order[2] setting the hearing of the motion on August 30, 2002.

On August 29, 2002, complainant received summons in Civil Case No. 364-0-2002. Forthwith, she filed a motion to
dismiss the complaint on the ground of improper venue. This was denied by respondent judge.

On August 30, 2002, respondent judge considered the Urgent Ex-Parte Motion to Preserve Properties to be Collated
submitted for resolution after hearing the testimonies of Harlinghausens attorney-in-fact, Harry E. Joost, and his counsel
of record, Atty. Edmundo S. Carian.

On September 3, 2002, respondent judge issued an Order[3] granting the urgent ex-parte motion and placing under legal
custody the properties enumerated therein. The Register of Deeds of Tarlac, among others, was directed to annotate the
Order on the 62 land titles allegedly purchased by Harlinghausens wife using his money without his consent.

On October 2, 2002, Harlinghausen, through counsel, filed another Ex-Parte Motion praying for the issuance of
an Order directing the Bureau of Immigration and Deportation (BID) to allow him to enter this country in order to
prosecute his petition for declaration of nullity of marriage.

On October 4, 2002, respondent judge issued an Order granting Harlinghausens Ex-Parte Motion.

Eventually, complainant filed with the Court of Appeals a petition for certiorari assailing respondent judges Order
dated September 3, 2002 granting Harlinghausens Urgent Ex-Parte Motion to Preserve Properties to be Collated; Order
dated October 4, 2002 granting his Urgent Ex-Parte Motion to enter this country; and Order denying her (complainants)
motion to dismiss the complaint for improper venue. Complainant averred that in issuing the challenged Orders,
respondent judge acted with grave abuse of discretion tantamount to lack or excess of jurisdiction. The petition was
docketed as CA-G.R. SP No. 74167.

On February 20, 2003, the Court of Appeals rendered a Decision[4] granting complainants petition, declaring
void the assailed Orders dated September 3 and October 4, 2002 and dismissing the complaint in Civil Case No. 364-02002 for declaration of marriage for improper venue.

Harlinghausen filed a motion for reconsideration, but it was denied by the Appellate Court. He then filed with this
Court a petition for review on certiorari, docketed as G.R. No. 158333. In a Resolution of June 23, 2003, we denied the
petition for his failure to show that the Court of Appeals committed a reversible error. Upon finality of our Resolution on
August 12, 2003, an Entry of Judgment was made on October 3, 2003.[5]

Complainant now contends that respondent judge, in issuing the Order of September 3, 2002 granting
Harlinghausens Urgent Ex-Parte Motion to Preserve Properties to be Collated, is ignorant of the law and abused his
authority. The motion lacks the notice of hearing to be served upon the adverse party three (3) days before the hearing;
and proof of service of the motion upon the adverse party.

Complainant further contends that in issuing the Order dated October 4, 2002 directing the BID to allow
Harlinghausen to enter this country, respondent judge abused his authority and misused court processes.

In his comment, respondent judge explained that he did not disregard the basic procedural rules. Although the
Urgent Ex-Parte Motion to Preserve Properties to be Collated lacks a notice of hearing, nevertheless he set the motion for
hearing to enable the adverse party, herein complainant, to participate therein or to file an opposition. Besides, the Rules
allow him to act upon an ex-parte motion requiring quick action, like the motion before him. There was urgency
considering that the conjugal funds are being misappropriated by complainant. Moreover, he conducted clarificatory
hearing. At any rate, his questioned Order is not tainted with bad faith or fraud.

With respect to the Order of October 4, 2002, respondent judge explained that he did not overstep his
jurisdiction. He recognized the authority of the BID. In fact, he stated in his questioned Order that it is without prejudice
to the authority of the BID over Harlinghausen.

In his Report and Recommendation, Court Administrator Presbitero J. Velasco, Jr. stated inter alia that:

A thorough examination of the instant case reveals abuse of authority bordering on gross
ignorance of the law. Records show that, relative to the petition for declaration of nullity of marriage,
respondent Judge issued at least two orders that were bluntly nullified by the appellate court. The rules
and principles ignored were so basic, and haste was characteristically palpable from the incidents.
xxx
Likewise, respondent cannot take shield from the fact that his assailed orders were already set
aside by the appellate court through the proper judicial remedies. Precisely, his cited jurisprudence itself
explicitly states, It is only after the available judicial remedies have been exhausted or when the appellate
tribunal have spoken with finality that the door to an inquiry to his administrative liability may be said to
have opened or closed. A display of haste and disregard of basic rules is a norm incompatible with the
prudent attitude and sobriety expected of a good judge.

He recommended that:

1. The instant complaint be RE-DOCKETED as a regular administrative matter;

2. The respondent Judge, for abuse of authority and gross ignorance of the law, be accordingly
meted a FINE in the amount of twenty thousand pesos (P20,000.00) with a WARNING that future
similar infractions shall be dealt with more severely.

In our Resolution[6] dated January 24, 2005, we required the parties to manifest whether they are submitting the
case for resolution on the basis of the pleadings and records filed.

Subsequently, both parties submitted their respective Manifestations stating their willingness to submit the case
for decision based on the records.

On the challenged Order of September 3, 2002, Sections 4, 5 and 6, Rule 15 of the 1997 Rules of Civil Procedure,
as amended, are pertinent, thus:

SECTION 4. Hearing of motion. Except for motions which the court may act upon without
prejudicing the rights of the adverse party, every written motion shall be set for hearing by the applicant.

Every written motion required to be heard and the notice of the hearing thereof shall be served in
such a manner as to ensure its receipt by the other party at least three (3) days before the date of hearing,
unless the court for good cause sets the hearing on shorter notice.
SECTION 5. Notice of hearing. The notice of hearing shall be addressed to all parties concerned,
and shall specify the time and date of the hearing which must not be later than ten (10) days after the
filing of the motion.
SECTION 6. Proof of service necessary. No written motion set for hearing shall be acted upon by
the court without proof of service thereof.

Obviously, respondent judge blatantly disregarded the above provisions. Instead of denying the motion outright
for being manifestly defective, he granted the same. While he set the motion for hearing, still the three-day notice was not
observed, thus complainant failed to attend the hearing. Clearly, she was deprived of her right to due process.

When a judge fails to consider so basic and elemental a rule, a law, or a principle in the discharge of his duties, he
is either too incompetent and undeserving of his position, or is too vicious that the oversight or omission was deliberately
done in bad faith and in grave abuse of judicial authority. In both instances, the judges dismissal is in order.[7]

Likewise, respondents failure to afford complainant the opportunity to be heard as a matter of due process of law
deserves administrative sanction.[8]

Relative to the challenged Order dated October 4, 2002, respondent judge shows his ignorance of the Philippine
Immigration Act of 1940, as amended. This law confers upon the Commissioner of the BID, to the exclusion of the courts
of justice, the power and authority to enforce its provisions, specifically the admission of foreigners to this country.

We sustain the observation of the Court of Appeals[9] that the Order of respondent judge directing the BID to
allow the entry of Harlinghausen to this country would effectively countermand the order of detention [10] issued by the
BID and constitutes an intrusion into its prerogatives as regards the entry, admission, exclusion, registration, repatriation,
monitoring and deportation of foreigners within our national territory.

In his desperate attempt to evade administrative sanction, respondent judge maintains that since complainant has
already resorted to a proper remedy, i.e., by filing a petition for certiorari with the Court of Appeals questioning his twin
Orders, she is barred from filing the instant administrative complaint involving the same Orders. He cited our ruling in
Hilario vs. Ocampo III, 371 SCRA 260 (2001) that where some judicial means is available, an administrative complaint is
not the appropriate remedy for an act of a judge deemed aberrant or irregular.

While it is true that the Court of Appeals has set aside the questioned twin Orders, the fact remains that
respondent judge has shown his ignorance of both substantive and procedural laws which warrants an administrative
sanction.

The Court recognizes that not every judicial error bespeaks ignorance of the law and that, if committed in good faith, does
not warrant administrative sanction, but only in cases within the parameters of tolerable misjudgment. Where, however,
the procedure is so simple and the facts so evident as to be beyond permissible margins of error, as in this case, to still err
thereon amounts to ignorance of the law.[11]

In this case, respondent judge displayed a deplorable deficiency in his grasp of the basic principles governing
motions, specifically, the three-day notice rule and the requisite proof of service. Also, he showed his utter lack of
knowledge and understanding of our immigration laws.

As an advocate of justice and a visible representation of the law, a judge is expected to keep abreast with and be
proficient in the application and interpretation of the law.[12] When the law is sufficiently basic, as what is involved in the
present case, a judge owes it to his office to simply apply it; anything less than that would be gross ignorance of the law.
[13]

In Tugot v. Coliflores,[14] we held that judicial competence demands that judges should be proficient in both
procedural and substantive aspects of the law. Anything less than this strict standard would subject them to administrative
sanction.

It is imperative that judges be conversant with basic legal principles. The Code of Judicial Conduct, in fact, enjoins
judges to be faithful to the law and maintain professional competence.[15]

Under Section 1, Rule 140 of the Revised Rules of Court on the Discipline of Justices and Judges, gross ignorance of the
law is classified as a serious charge punishable by either dismissal from the service, suspension from office or a fine of
more than P20,000.00 but not exceeding P40,000.00.

We believe that an imposition of P30,000.00 fine upon respondent judge is in order.

WHEREFORE, respondent Judge Renato J. Dilag is hereby found GUILTY of gross ignorance of the law and is
ordered to pay a FINE of THIRTY THOUSAND PESOS (P30,000.00) upon notice.

SO ORDERED.

ANGELINA SANDOVAL-GUTIERREZ
Associate Justice

WE CONCUR:

HILARIO G. DAVIDE, JR.

Chief Justice

REYNATO S. PUNO

ARTEMIO V. PANGANIBAN

Associate Justice

Associate Justice

LEONARDO A. QUISUMBING

CONSUELO YNARES-SANTIAGO

Associate Justice

Associate Justice

ANTONIO T. CARPIO

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice

Associate Justice

RENATO C. CORONA

CONCHITA CARPIO MORALES

Associate Justice

Associate Justice

ROMEO J. CALLEJO, SR.

ADOLFO S. AZCUNA

Associate Justice

Associate Justice

DANTE O. TINGA

MINITA V. CHICO-NAZARIO

Associate Justice

Associate Justice

CANCIO C. GARCIA
Associate Justice