Contents

Lucy Torres Gomez vs Codilla..................................................................................1

Kilosbayan case.......................................................................................................... 9
G.R. No. 180543......................................................................................................... 9
Ching........................................................................................................................ 25
Pan Pacific................................................................................................................ 34
Fuentes..................................................................................................................... 44

Lucy Torres Gomez vs Codilla

CONGRESSWOMAN
LUCY MARIE TORRES-GOMEZ
Petitioner,

- versus -

EUFROCINO C. CODILLA, JR.

and
HON.
HOUSE
OF
REPRESENTATIVES
ELECTORAL TRIBUNAL
Respondents.

G. R. No. 195191
Present:
CORONA, C.J.,
CARPIO,
VELASCO, JR.,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
BERSAMIN,
DEL CASTILLO,*
ABAD,
VILLARAMA, JR.,
PEREZ,
MENDOZA,
SERENO,
REYES, and
PERLAS-BERNABE, JJ.
Promulgated:

March 20, 2012

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

DECISION
SERENO, J.:
This is a Petition for Certiorari under Rule 65 of the Rules of
Court, with application for Temporary Restraining Order and/or Writ of
Preliminary Prohibitory Injunction. The Petition seeks to annul and set
aside Resolution No. 10-482 of the House of Representatives Electoral
Tribunal (HRET) in HRET Case No. 10-009 (EP) entitled Eufrocino C.
Codilla, Jr. v. Lucy Marie Torres-Gomez (Fourth District, Leyte), which
denied the Motion for Reconsideration filed by petitioner.
Statement of the Facts and the Case
On 30 November 2009, Richard I. Gomez (Gomez) filed his
Certificate of Candidacy for representative of the Fourth Legislative
District of Leyte under the Liberal Party of the Philippines. On even
date, private respondent Codilla Jr. filed his Certificate of Candidacy for
the same position under Lakas Kampi CMD.
On 6 December 2009, Buenaventura O. Juntilla (Juntilla), a
registered voter of Leyte, filed a Verified Petition for Gomezs
disqualification with the Commission on Elections (COMELEC) First
Division on the ground that Gomez lacked the residency requirement
for a Member of the House of Representatives.
In a Resolution dated 17 February 2010, the COMELEC First
Division granted Juntillas Petition and disqualified Gomez. On 20
February 2010, the latter filed a Motion for Reconsideration with the
COMELEC En Banc, which dismissed it on 4 May 2010, six days before
the May 2010 national and local elections. The dispositive portion of
the COMELECs Resolution[1] is worded as follows:
WHEREFORE, premises considered, the motion for
reconsideration filed by the Respondent is DISMISSED for
lack of merit. The Resolution of the Commission (First
Division) is hereby AFFIRMED.
SO ORDERED.[2]
On the same date, Gomez filed a Manifestation with the
COMELEC En Banc, alleging that, without necessarily admitting the
allegations
raised
by
Juntilla,
he
was accepting the aforementioned Resolution with finality, in order to
enable his substitute to facilitate the filing of the necessary documents
for substitution.

On 5 May 2010, petitioner Lucy Marie Torres-Gomez filed her

Certificate of Candidacy as substitute for the position of representative
of the Fourth Congressional District for the Province of Leyte vice
Gomez, her husband.
On 6 May 2010, Juntilla filed a Counter-Manifestation with the
COMELEC En Banc. At the same time, he wrote a letter to Atty.
Ferdinand T. Rafanan, Director of the Law Department of the
COMELEC, alleging the invalidity of the proposed substitution of Gomez
by petitioner.
On 8 May 2010, the COMELEC En Banc issued Resolution No.
8890, which approved and adopted the recommendation of its Law
Department to allow petitioner as a substitute candidate for Gomez for
representative of the Fourth Legislative District of Leyte.
On 9 May 2010, Juntilla filed an Extremely Urgent Motion for
Reconsideration of the above COMELEC Resolution No. 8890. Pending
resolution of his motion, the national and local elections were
conducted as scheduled.
After the casting, counting and canvassing of votes in the said
elections, petitioner emerged as the winner with 101,250 votes or a
margin of 24,701 votes over private respondent Codilla, who obtained
76,549 votes.
On 11 May 2010, Codilla filed an Urgent Ex-Parte Motion to
Suspend the Proclamation of Substitute Candidate Lucy Marie T.
Gomez (vice Richard I. Gomez) as the Winning Candidate of the May
10, 2010 Elections for the Fourth Congressional District of Leyte.
On the same date, Juntilla filed an Extremely Urgent Motion to
resolve the pending Motion for Reconsideration filed on 9 May 2010
relative to Resolution No. 8890 and to immediately order the Provincial
Board of Canvassers of the Province of Leyte to suspend the
proclamation of petitioner as a Member of the House of
Representatives, Fourth District, Province of Leyte.
On 12 May 2010, petitioner was proclaimed the winning
candidate for the congressional seat of the Fourth District of Leyte.
Accordingly, on 21 May 2010, private respondent Codilla filed a
Petition with public respondent HRET against petitioner docketed as
HRET Case No. 10-009 (Election Protest).
On 2 July 2010, petitioner filed her Verified Answer to Codillas
Election Protest questioning the alleged lack of the required
Verification and praying for its dismissal.
On 8 July 2010, Codilla filed a Reply to petitioners Verified
Answer.

In an Order issued by public respondent HRET, the instant case

was set for preliminary conference on 2 September 2010.
On 1 September 2010, unsatisfied with the Order of the HRET,
petitioner filed an Urgent Manifestation and Motion, persistent in her
position that Codillas Election Protest should be dismissed based on
the grounds raised in her Verified Answer. She also prayed for the
deferment of the preliminary conference until after the resolution of
the said motion.
On 9 September 2010, the HRET issued the assailed Resolution
No. 10-282[3] resolving the Urgent Manifestation and Motion filed by
petitioner, the dispositive portion of which provides:
The Tribunal NOTES the Urgent Manifestation and
Motion filed
on
September
1,
2010
by
the
protestee; REITERATES its ruling in Resolution No. 10-160
dated July 29, 2010 that the protest cannot be considered
insufficient in form, considering that the examination of the
original copy of the protest filed before the Tribunal had
revealed the existence of the required verification;
and DENIES the respondents motion for deferment of the
preliminary conference scheduled on September 2, 2010.[4]
Accordingly, on 30 September 2010, petitioner filed with public
respondent HRET a Motion for Reconsideration of the above Resolution
No. 10-282.
On 22 November 2010, public respondent HRET issued Resolution
No. 10-482[5] denying petitioners Motion for Reconsideration, ruling as
follows:
WHEREFORE, the Tribunal DENIES the instant motion
for reconsideration as regards the issues pertaining to
absence/defect of the verification and propriety of the
election protest; and DIRECTS the protestant to have his
verification properly notarized.[6]
Thereafter, petitioner filed the instant Petition for Certiorari [7] dated 7
February 2011. The Petition raises the following grounds:
A.
THE PUBLIC RESPONDENT ACTED WITH GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION WHEN IT REFUSED TO DISMISS THE
ELECTION PROTEST DESPITE AN ADMITTEDLY DEFECTIVE
VERIFICATION.

B.
THE PUBLIC RESPONDENT ACTED WITH GRAVE ABUSE
DISCRETION AMOUNTING TO LACK AND/OR EXCESS
JURISDICTION WHEN IT ALLOWED THE PROTESTANT
RAISE ISSUES ON QUALIFICATION OF CANDIDATES IN
ELECTION PROTEST.[8]

OF
OF
TO
AN

Petitioner claims that there was a material defect in the Verification of

the Election Protest, a requirement explicitly provided for in Rule 16 of
the 2004 Rules of the House of Representatives Electoral Tribunal
(HRET Rules).[9] The verification being a mandatory requirement, the
failure to comply therewith is a fatal defect that affects the very
jurisdiction of the HRET.
On the second issue, petitioner claims that what is in question in the
Election Protest is her qualification as a Member of the House of
Representatives, and not the number of votes cast. Her qualification is
allegedly not a proper ground for an election protest, in which the
issues should be the appreciation of ballots and the correctness and
number of votes of each candidate.
On 15 February 2011 this Court required respondents to file their
comment
on
the
Petition.
Thereafter,
Codilla
filed
his
Comment/Opposition dated 28 April 2011. In his Comment, he argues
that there was no grave abuse of discretion on the part of the HRET in
issuing the assailed Resolutions. He clarifies that the Election Protest
that he filed contained a validly executed Verification and Certification
of Non-Forum Shopping (Verification).[10] However, the defect that
petitioner points to is the portion of the jurat of the Verification, which
states:
Subscribed and sworn to before me this __ day of May
2010 at _____. Affiant personally and exhibited to me his
(1) License ID Card with Card No. H03-80-002135 issued
by LTO on January 16, 2009 (2) Philippine Passport No.
XX4793730 issued on October 20, 2009 valid until October
19, 2014, he, being the same person herein who executed
the foregoing document thereof.[11]
The date May 21 2009 was stamped on the first blank in __ day of May
2010. May 21 2010 was written with a pen over the stamped date May
21 2009 and countersigned by the notary public. Codilla claims that
the date of the Verification was a mere innocuous mistake or
oversight, which did not warrant a finding that the Verification was

defective; much less, fatally defective. He claims he should not be

faulted for any alleged oversight that may have been committed by the
notary public. Further, the same argument holds true with respect to
the absence of the Mandatory Continuing Legal Education (MCLE)
Compliance Number of the notary public, as well as the overdue
Professional Tax Receipt (PTR) indicated in the notarial stamp. In any
case, the insufficiency of the Verification was not fatal to the
jurisdiction of the HRET.
With respect to the second issue, Codilla argues that the issues in the
Election Protest do not pertain to petitioners qualification, but to the
casting and counting of votes. He claims that his Election Protest
contests the declaration by the Board of Canvassers that the 101,250
votes should be counted in favor of petitioner and be credited to him
as these should have instead been declared as stray votes.
Thereafter, public respondent HRET filed its Comment [12] on the Petition
dated 5 May 2011. In its Comment, the HRET claims that it did not
commit grave abuse of discretion when it took cognizance of Codillas
Election Protest despite an alleged absence/defect in the verification.
After all, an unverified petition differs from one which contains a
defective verification, such as in this case. A defective verification is
merely a formal defect which does not affect the jurisdiction of the
tribunal. In any case, the summary dismissal of an Election Protest, as
well as the allowance of its amendments in matters of form, is
sanctioned by the HRET Rules.
The HRET further argues that it did not commit grave abuse of
discretion when it took cognizance of the Election Protest. The issue
raised in the Election Protest was the validity of petitioners
proclamation, in view of her alleged invalid substitution. This is a
matter that is addressed to the sound judgment of the HRET.
On 7 June 2011, this Court, among others, required petitioner to
file a reply to Codillas Comment. Petitioner later filed her Reply dated
15 August 2011, citing an additional ground for considering the
Verification as defective. She claimed that Codilla, a resident of Ormoc
City, could not have possibly appeared before a notary public in
Quezon City; and that he failed to prove that he was indeed in Quezon
City when he supposedly verified the Election Protest.
The Courts Ruling
The Petition is dismissed for failure to show any grave abuse of
discretion on the part of the HRET.
On the Allegedly Defective Verification

While the existence of the Verification is not disputed, petitioner

notes three alleged defects. First, the Election Protest was filed on 21
May 2010, but the Verification was allegedly subscribed and sworn to
on 21 May 2009.[13] Second, Codilla, a resident of Ormoc City, could
not have possibly appeared personally before the notary public in
Quezon City.[14] Third, in the notarial stamp, the date of expiration of
the notarial commission was handwritten while all other details were
stamped; the PTR indicated was issued in 2005; there was no MCLE
Compliance Number as required by Bar Matter No. 1922. [15] Petitioner
claims that due to the lack of a proper verification, the Election Protest
should have been treated as an unsigned pleading and must be
dismissed.
The alleged defects of the Verification are more apparent than
real.
With respect to the date of the notarization, it is clear that the
stamped date 2009 was a mere mechanical error. In fact, the notary
public had superimposed in writing the numbers 10 and countersigned
the alteration. Thus, this error need not be overly magnified as to
constitute a defect in the Verification.
With respect to the second alleged defect, there is a presumption
that official duty has been regularly performed with respect to the
jurat of the Verification, wherein the notary public attests that it was
subscribed and sworn to before him or her, on the date mentioned
thereon.[16] Official duties are disputably presumed to have been
regularly performed. Thus, contrary to petitioners allegation, there was
no need for Codilla to attach his plane ticket to prove he flew from
Ormoc City to Manila.[17]
Further, to overcome the presumption of regularity, clear and
convincing evidence must be presented.[18] Absent such evidence, the
presumption must be upheld. The burden of proof to overcome the
presumption of due execution of a notarized document lies on the
party contesting the execution.[19] Thus, petitioners contention that she
had reliable information that [Codilla] was in Ormoc City on the date
indicated in the Verification cannot be considered as clear and
convincing evidence to rebut the presumption that the document was
duly executed and notarized.
With respect to the third alleged defect, the fact that some
portions of the stamp of the notary public were handwritten and some
were stamped does not, in itself, indicate any defect. Further, Bar
Matter No. 1922 merely requires lawyers to indicate in all pleadings
filed before the courts or quasi-judicial bodies, the number and date of

issue of their MCLE Certificate of Compliance or Certificate of

Exemption, whichever is applicable for the immediately preceding
compliance period. Clearly, the regulation does not apply to notarial
acts. With respect to the PTR number which was dated 5 years prior to
the date of notarization, the deficiency merely entails the potential
administrative liability of the notary public.[20]
In any case, there was no grave abuse of discretion on the part
of the HRET in denying petitioners Motion to Dismiss the Election
Protest and directing Codilla to have his Verification properly notarized.
It has been consistently held that the verification of a pleading is
only a formal, not a jurisdictional, requirement. The purpose of
requiring a verification is to secure an assurance that the allegations in
the petition are true and correct, not merely speculative. This
requirement is simply a condition affecting the form of pleadings, and
noncompliance therewith does not necessarily render the pleading
fatally defective.[21]
This Court has emphasized that in this species of controversy
involving the determination of the true will of the electorate, time is
indeed of paramount importance. An election controversy, by its very
nature, touches upon the ascertainment of the peoples choice as
gleaned from the medium of the ballot. For this reason, an election
protest should be resolved with utmost dispatch, precedence and
regard for due process. Obstacles and technicalities that fetter the
peoples will should not stand in the way of a prompt termination of
election contests.[22] Thus, rules on the verification of protests should
be liberally construed.
At this point, it is pertinent to note that such liberalization of the
rules was also extended to petitioner. A perusal of the Verification and
Certification attached to this Petition shows she attests that the
contents of the Petition are true and correct of [her] own personal
knowledge, belief and based on the records in [her] possession.
[23]
Section 4, Rule 7 of the Rules of Court provides that a pleading
required to be verified which contains a verification based on
information and belief or knowledge, information and belief, shall be
treated as an unsigned pleading. A pleading, therefore, wherein the
verification is based merely on the party's knowledge and belief such
as in the instant Petition produces no legal effect, subject to the
discretion of the court to allow the deficiency to be remedied. [24]
On the Propriety of the Election Protest
Codillas Election Protest contests the counting of 101,250 votes in
favor of petitioner. He claims that the denial of the Certificate of

Candidacy of Gomez rendered the latter a non-candidate, who

therefore could not have been validly substituted, as there was no
candidacy to speak of.
It bears stressing that the HRET is the sole judge of all contests
relating to the election, returns, and qualifications of the members of
the House of Representatives. This exclusive jurisdiction includes the
power to determine whether it has the authority to hear and determine
the controversy presented; and the right to decide whether there
exists that state of facts that confers jurisdiction, as well as all other
matters arising from the case legitimately before it. [25] Accordingly, the
HRET has the power to hear and determine, or inquire into, the
question of its own jurisdiction both as to parties and as to subject
matter; and to decide all questions, whether of law or of fact, the
decision of which is necessary to determine the question of
jurisdiction.[26] Thus, the HRET had the exclusive jurisdiction to
determine its authority and to take cognizance of the Election Protest
filed before it.
Further, no grave abuse of discretion could be attributed to the
HRET on this score. An election protest proposes to oust the winning
candidate from office. It is strictly a contest between the defeated and
the winning candidates, based on the grounds of electoral frauds and
irregularities. Its purpose is to determine who between them has
actually obtained the majority of the legal votes cast and is entitled to
hold the office.[27] The foregoing considered, the issues raised in
Codillas Election Protest are proper for such a petition, and is within
the jurisdiction of the HRET.
WHEREFORE, the instant Petition for Certiorari is DISMISSED.
The Application for a Temporary Restraining Order and/or Writ of
Preliminary Prohibitory Injunction is likewise DENIED. Resolution Nos.
10-282 and 10-482 of the House of Representatives Electoral Tribunal
are hereby AFFIRMED.
SO ORDERED.
Kilosbayan case
EN BANC
KILOSBAYAN
FOUNDATION and
BANTAY KATARUNGAN
FOUNDATION, as

G.R. No. 180543

Present:
CORONA, C.J.,

represented by JOVITO
R. SALONGA,
Petitioners,
- versus -

CARPIO,
CARPIO MORALES,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
BERSAMIN,
DEL CASTILLO,
ABAD,
VILLARAMA, JR.,
PEREZ, and
MENDOZA, JJ.

LEONCIO M. JANOLO,
JR., PRESIDING JUDGE,
RTC,
BRANCH
264,
PASIG CITY; GREGORY
S.
ONG,
ASSOCIATE
JUSTICE,
SANDIGANBAYAN; and Promulgated:
THE
LOCAL
CIVIL
REGISTRAR
OF
SAN July 27, 2010
JUAN, METRO MANILA,
Respondents.
x----------------------------------------------------------------------------------------x
DECISION
CARPIO MORALES, J.:
On July 9, 2007, private respondent Gregory Ong (Ong), following the
promulgation of the Courts Decision in Kilosbayan Foundation v.
Ermita,[1] filed a petition[2] under Rule 108 of the Rules Court for the
amendment/correction/supplementation or annotation of the entry on
citizenship in his Certificate of Birth, docketed as Sp. Proc. No. 11767SJ and raffled to Branch 264 of the Regional Trial Court (RTC) of Pasig
City over which public respondent Leoncio Janolo, Jr. presided.
Via
the
present
recourse
of
certiorari
and
prohibition,
petitioners Kilosbayan Foundation and Bantay Katarungan Foundation
assail four Orders and the Decision emanating from the proceedings in
the RTC case.
As Ongs petition was set for hearing by the RTC on August 7, 14, 21
and 28, 2007,[3] petitioners-therein oppositors[4] filed on August 6,

2007 a motion for voluntary inhibition, which the RTC denied by Order
of August 7, 2007, a day after it was filed and prior to the hearing on
the motion.[5] Despite the pendency of petitioners motion for
reconsideration, the RTC proceeded to hear Ongs petition on August 14
and 21, 2007. It was only by Order of September 17, 2007[6] that the
motion for reconsideration was resolved, a copy of which was received
by petitioners on October 4, 2007.
Meanwhile, by Order of August 21, 2007,[7] the RTC declared
petitioners in default. Petitioners motion to vacate the order of default
was likewise denied by Order of October 4, 2007,[8] a copy of which
was received by petitioners on October 17, 2007. Subsequently, the
RTC granted Ongs petition and recognized him as a natural-born
citizen of the Philippines, by Decision of October 24, 2007.[9]
In the present petition filed on December 3, 2007, petitioners assert
that public respondent erred and committed grave abuse of discretion:
(a) [i]n not voluntarily inhibiting himself from presiding over the case;
(b) [i]n declaring herein [p]etitioners as having defaulted; and (c) in
granting the Petition of [r]espondent Gregory S. Ong.[10]
The Court, by Resolution of February 19, 2008, required respondents
to comment on the petition, with which Ong and the Office of the
Solicitor General (OSG) complied on March 14, 2008 and June 5, 2008,
respectively. Petitioners
submitted
their
Consolidated
Reply
on December 10, 2008.
The Court shall first resolve the preliminary objections raised by
respondents. Both Ong and the OSG claim that petitioners availed
themselves of an improper remedy and disregarded the hierarchy of
courts. Ong adds that the defective verification renders the petition as
unsigned pleading, and the lack of service of the petition on all adverse
parties violates basic rules.
The question on the propriety of the remedy availed of by petitioners is
resolved in Cerezo v. Tuazon,[11] where the Court discussed the various
remedies available to a party declared in default, including a petition
for certiorari to declare the nullity of a judgment by default if the trial
court improperly declared a party in default, or even if the trial court
properly declared a party in default, if grave abuse of discretion
attended such declaration. A party declared in default may thus

alternatively file a petition for certiorari assailing both the order of

default and the judgment of default. [12] On the choice of remedy, the
Court finds petitioners recourse procedurally allowable. The same,
however, cannot be said as to the choice of court forum.
The hierarchy of courts serves as a general determinant of the
appropriate forum for appeals and petitions for extraordinary writs.
[13]
The rule on hierarchy of courts is not absolute, and the Court has
full discretionary power to take cognizance of a petition filed directly
with it. A direct invocation of this Courts original jurisdiction may be
allowed where there are special and important reasons therefor clearly
and specifically set out in the petition.[14]
The present petition is bereft of even a single allegation of
exceptional and compelling circumstance to warrant an exception to
the rule. In fact, this valid objection elicited no response from
petitioners, who glossed over all procedural issues in their Consolidated
Reply. If petitioners themselves do not provide the Court some basis
for the direct recourse, the Court is not minded to search for one.
Further, the petition carries a defective verification since it was verified
without stating the basis thereof. In the Verification/ Certification of the
Petition, the affiant states that he has read the same and all the facts
contained therein are true and correct. [15] The Rules clearly state that a
pleading is verified by an affidavit that the affiant has read the pleading
and that the allegations therein are true and correct of his personal
knowledge or based on authentic records, and a pleading required to
be verified which lacks a proper verification shall be treated as an
unsigned pleading.[16] Verification is not an empty ritual or a
meaningless formality. Its import must never be sacrificed in the name
of mere expedience or sheer caprice. For what is at stake is the matter
of verity attested by the sanctity of an oath to secure an assurance that
the allegations in the pleading have been made in good faith, or are
true and correct and not merely speculative.[17]
Moreover, this Court observes that the affiant failed to present
competent evidence of his identity before the notary public, as required
under the 2004 Rules on Notarial Practice. [18] The Court cannot assume
that affiant, being a public figure, is personally known to the notary
public, for the jurat does not contain a statement to that effect.

Records also show that petitioners failed to furnish public respondent

with a copy of the petition. The Rules require that the petition should
be filed with proof of service on all adverse parties, and that the failure
to comply with the requirement shall be sufficient ground for the
dismissal of the petition.[19]
On procedural grounds alone then, the petition is susceptible to
dismissal. The Court deems it best, however, to resolve the substantial
issues in the interest of justice.
In their motion for voluntary inhibition, petitioners cite that Ong, his
counsel, and public respondent are members of the San Beda Law
Alumni Association which, along with the schools Benedictine
community, publicly endorsed and supported Ongs petition through
newspaper advertisements. Moreover, from the account of the
proceedings, petitioners point out that issuing the order of default
without resolving the motion for reconsideration of the order denying
the motion for inhibition exhibits blatant bias for being unduly
precipitate and wholly unwarranted.
The rule on compulsory disqualification and voluntary inhibition of
judges is provided under Section 1, Rule 137 of the Rules of Court:
No judge or judicial officer shall sit in any case in which he,
or his wife or child, is pecuniarily interested as heir, legatee,
creditor or otherwise, or in which he is related to either
party within the sixth degree of consanguinity or affinity, or
to counsel within the fourth degree, computed according to
the rules of the civil law, or in which he has been executor,
administrator, guardian, trustee or counsel, or in which he
has presided in any inferior court when his ruling or decision
is the subject of review, without the written consent of all
parties in interest, signed by them and entered upon the
record.
A judge may, in the exercise of his sound discretion,
disqualify himself from sitting in a case, for just or valid
reasons other than those mentioned above. (underscoring
supplied)

In keeping with the tenet that judges should not only act with fairness,
independence, impartiality and honesty but should also be perceived to
be the embodiment of such qualities, the Court added the rule
on voluntary inhibition in 1964. In outlining the genesis of the
provision, the Court narrated:
In Umale v. Villaluz, the Court traced the history of the
second paragraph of the above-quoted provision, which had
been added only as an amendment to the Rules of Court in
1964. Prior to that year, the question on whether to take
cognizance of the case did not depend upon the discretion of
the judges not legally disqualified to sit in a given case. If
those concerned were not disqualified, it was their official
duty to proceed with the case or else risk being called upon
to account for their dereliction. They could not voluntarily
inhibit themselves on grounds of prejudice or bias, extreme
delicacy, or even if they themselves took great interest and
an active part in the filing of the case. Gutierrez v.
Santos and Del Castillo v. Javelona paved the way for the
recognition of other circumstances for disqualification those
that depended upon the exercise of discretion of the judges
concerned.[20]
While the second paragraph does not expressly enumerate the specific
grounds for inhibition and leaves it to the sound discretion of the judge,
such should be based on just or valid reasons. The import of the rule
on the voluntary inhibition of judges is that the decision on whether to
inhibit is left to the sound discretion and conscience of the judge based
on his rational and logical assessment of the circumstances prevailing
in the case brought before him. It makes clear to the occupants of the
Bench that outside of pecuniary interest, relationship or previous
participation in the matter that calls for adjudication, there might be
other causes that could conceivably erode the trait of objectivity, thus
calling for inhibition. That is to betray a sense of realism, for the factors
that lead to preferences and predilections are many and varied. [21]
In the final reckoning, there is really no hard and fast rule when it
comes to the inhibition of judges. Each case should be treated
differently and decided based on its peculiar circumstances.

The issue of voluntary inhibition is primarily a matter of

conscience and sound discretion on the part of the judge. It is
a subjective test, the result of which the reviewing tribunal will not
disturb in the absence of any manifest finding of arbitrariness and
whimsicality. The discretion given to trial judges is an acknowledgment
of the fact that they are in a better position to determine the issue of
inhibition, as they are the ones who directly deal with the partieslitigants in their courtrooms.[22]
Impartiality being a state of mind, there is thus a need for some kind of
manifestation of its reality, in order to provide good, sound or ethical
grounds or just and valid reasons for inhibition.[23] Bare allegations of
bias and prejudice are not enough in the absence of clear and
convincing evidence to overcome the presumption that a judge will
undertake his noble role to dispense justice according to law and
evidence and without fear or favor.[24] In Gochan v. Gochan,[25] the
Court elucidated further:

Verily, the second paragraph of Section 1 of Rule 137 does

not give judges the unfettered discretion to decide whether
to desist from hearing a case. The inhibition must be for just
and valid causes. The mere imputation of bias or partiality is
not enough ground for them to inhibit, especially when the
charge is without basis. This Court has to be shown acts or
conduct clearly indicative of arbitrariness or prejudice before
it can brand them with the stigma of bias or partiality.
In a string of cases, the Supreme Court has said that bias
and prejudice, to be considered valid reasons for the
voluntary inhibition of judges, must be proved with clear
and convincing evidence. Bare allegations of their
partiality will not suffice. It cannot be presumed, especially
if weighed against the sacred oaths of office of magistrates,
requiring them to administer justice fairly and equitably
both to the poor and the rich, the weak and the strong, the

lonely
and
the
well-connected.[26] (emphasis
underscoring supplied)

and

The Court applied the same precept in Pagoda Philippines, Inc. v.

Universal Canning, Inc.[27] where the judges right to inhibit was
weighed against his duty to decide the case without fear of
repression. Indeed, the automatic granting of a motion for voluntary
inhibition would open the floodgates to a form of forum-shopping, in
which litigants would be allowed to shop for a judge more sympathetic
to their cause, and would prove antithetical to the speedy and fair
administration of justice.[28]
A judge must decide based on a rational and logical assessment of the
circumstances prevailing in a case brought before him. [29] In the
present case, petitioners cite public respondents affiliation with an
alumni association as the sole ground to which they anchor their
motion for the voluntary inhibition of public respondent.
Before the trial court, petitioners alleged that the law school ties
among public respondent, Ong and his counsel, they having graduated
from San Beda College of Law, albeit years apart, spell partiality.
Inhibition is not allowed at every instance that a schoolmate or
classmate appears before the judge as counsel for one of the parties,
however.[30] In one case,[31] the Court ruled that organizational
affiliation per se is not a ground for inhibition.
Membership in a college fraternity, by itself, does not
constitute a ground to disqualify an investigator, prosecutor
or judge from acting on the case of a respondent who
happens to be a member of the same fraternity. A trial
Judge, appellate Justice, or member of this Court who is or
was a member of a college fraternity, a university alumni
association, a socio-civic association like Jaycees or Rotary,
a religion-oriented organization like Knights of Columbus or
Methodist Men, and various other fraternal organizations is

not expected to automatically inhibit himself or herself from

acting whenever a case involving a member of his or her
group happens to come before him or her for action.

A member in good standing of any reputable organization is

expected all the more to maintain the highest standards of
probity, integrity, and honor and to faithfully comply with
the ethics of the legal profession.[32] (underscoring supplied)

The added fact that the law schools alumni association published
statements in support of Ongs application cannot lend credence to the
imputation of bias on the part of pubic respondent. No clear and
convincing evidence was shown to indicate that public respondent
actively sponsored and participated in the adoption and publication of
the alumni associations stand. It is inconceivable to suppose that the
alumni associations statement obliged all its members to earnestly
embrace the manifesto as a matter of creed.
Arbitrariness cannot be inferred either from the fact that public
respondent resolved the motion for voluntary inhibition one day after it
was filed. Since the personal process of careful self-examination [33] is
essentially a matter of conscience, the judge may decide as soon as
the factual basis of the motions has been clearly laid before the court
because from there on the resolution of the motion enters the
subjective phase.
That public respondent, Ong and his counsel former Senator Rene
Saguisag are all graduates of San Beda College of Law was clearly and
early on established. Hence, this sole ground relied upon by petitioners
in their motion, it bears repeating, no longer required a hearing or
called for the submission of a comment or opposition, and the absence
thereof did not prejudice petitioners.
In one case,[34] it was held that the Rules of Court does not direct
the court to order the filing of comments or oppositions to the motion
before the motion is resolved. The parties may orally argue and

ventilate their positions and, thereafter, the court may rule on the
motion.
The Court notes that when petitioners filed the Omnibus Motion
(for reconsideration and deferment) which basically reiterated their
previous arguments, they no longer set the motion for hearing and
simply submitted their motion ex parte without further arguments,
thereby recognizing the non-litigious nature of their allegations.
Even assuming that Ong interposed no objection to the motion, it
was still up to public respondent to discern, for a qualified judge cannot
be ousted from sitting in a case by sheer agreement of the parties.
Petitioners further complain that public respondent proceeded to hear
the case and declared them in default without first resolving their
pending motion. Records show that petitioners filed on August 13,
2007 an Omnibus Motion[35] for reconsideration of the August 7,
2007 Order and for deferment of the hearings set on August 14, 21
and 28, 2007. Petitioners, thereafter, did not appear in the various
settings, they alleging that the question of voluntary inhibition, which
they deem to be an overriding consideration partaking of a highly
prejudicial matter, had yet to be resolved by the trial court.[36]
While there is no specific rule providing for a definite period of time
within which to resolve a motion for reconsideration of an order
denying inhibition, judges must endeavor to act promptly on it within
the mandatory 90-day period so as not to interrupt the course of trial.
[37]

The trial court narrated what transpired on August 14, 2007 as

confirmed by the entry of the nunc pro tunc Order of September 17,
2007 making on record the denial of the Omnibus Motion.
During the hearing on August 14, 2007, the Court,
after considering the arguments and counter-arguments
from petitioner [Ong] and the Office of the Solicitor General,
and finding no cogent reasons to reconsider its earlier
position, denied in open court the motion seeking a
reconsideration of the Order dated August 7, 2007 which
denied movants Motion for Voluntary Inhibition of Presiding

Judge. Corollarily, for lack of merit, the motion to defer the

proceedings in the instant case was similarly denied. (see
TSN, August 14, 2007, pp. 13). (citation in the original)[38]
The cited record of the proceedings validates the disposition made by
the trial court on the given date, during which time petitioners failed to
appear. After hearing the arguments, the trial court ruled as follows,
quoted verbatim:
COURT: Thats right, so theres no basis to overturn our
previous Order denying the motion to voluntary
inhibition filed by Atty. Capulong Now, theres
another matter being raised here, counsel could not
have a valid argument here to delay the
proceedings What the Supreme Court wanted is to
have an Order summary of the proceeding because
Kilos Bayan did sought at their level. Supreme Court
was expecting that they will do so again in our level,
but in since theres seems to be no good idea
waiting for the adversary arguments, so, it will,
when it reaches the Supreme Court, it will repeat
the purpose to which they were directed to
litigate. Theyre supposed to litigate because if they
believe theyre for the denial of the petition, unless
the application for declaration of natural born
citizen, they should do so without any delay, so, use
Bayan as a very an active group and Bantay
Katarungan, they should be a party to expeditious
resolution of cases, not to a delay. How many are
we here from government. We are here to
litigate. So, the Motion for Reconsideration is
denied, and Motion to Defer Further Proceedings is
also denied. The settings for August were all placed
in the Order which was published in the newspaper
of general circulation. We have previously agreed
that we will proceed to cross of petitioner and
witnesses. Are you ready or would you agree to the
suggestion by the Court that we conduct pre-trial?
[39]
(underscoring supplied)

The issuance of a nunc pro tunc order is recognized where an

order actually rendered by a court at a former time had not been
entered of record as rendered.[40] The phrase nunc pro tunc signifies
now for then, or that a thing is done now that shall have the same
legal force and effect as if done at the time it ought to have been
done.[41] The purpose of an order nunc pro tunc is to make a present
record of an order that the court made in a previous term, but which
was not then recorded. It can only be made when the thing ordered
has previously been made, but, by inadvertence, has not been
entered.[42]
In the case at bar, the trial court actually took judicial action
which was, however, by mistake or inadvertence, not placed in proper
form on record. In any event, petitioners neither seriously contest the
veracity of the transcript used as basis for such confirmatory order nor
claim any unwarranted prejudice from the fact of its resolution during
their non-appearance in the scheduled hearing.
The disallowance of a motion for postponement is not sufficient to
show arbitrariness and partiality of the trial court. [43] For one, the grant
of such is not a matter of right for it is addressed to the sound
discretion of the court.[44] Parties have absolutely no right to assume
that their motion for deferment would be granted, hence, they should
prepare for the hearing, lest they pass the blame to no one but
themselves.
Further, in considering such motions, two things must be borne in
mind: (1) the reason for the postponement and (2) the merits of the
case of the movant.[45] In this case, the requested postponement was
premised on the pendency of the motion for reconsideration. The
Omnibus Motion was, however, submitted ex parte and without further
arguments from Oppositors,[46] drawing public respondent to promptly
resolve it by denying it.
As to the merits of the case of petitioners, the trial court was left
with nothing to assess since they did not file any Opposition to Ongs
Petition despite the grant to them of extension of time for the purpose
and their various submissions to the trial court all related to peripheral
issues.

No trace of bias can be found at that juncture when the court

proceeded to declare petitioners in default after resolving the pending
incidents. It is an equally important doctrine that bias and prejudice
must be shown to have resulted in an opinion on the merits on the
basis of an extrajudicial source, not on what the judge learned from
participating in the case. As long as opinions formed in the course of
judicial proceedings are based on the evidence presented and the
conduct observed by the magistrate, such opinion even if later found to
be erroneous will not prove personal bias or prejudice on the part of
the judge. While palpable error may be inferred from the decision or
the order itself, extrinsic evidence is required to establish bias, bad
faith, malice or corrupt purpose.[47]
Divergence of opinion as to applicable laws and jurisprudence between
counsel
and
the
judge
is
not
a
proper
ground
for
disqualification. Opinions framed in the course of judicial proceedings,
although erroneous, as long as they are based on the evidence
presented and conduct observed by the judge, do not prove bias or
prejudice. Repeated rulings against a litigant no matter how erroneous
are not bases for disqualification.[48]
As for the allegation of undue haste, the Court cannot appreciate it,
considering that the trial court even granted petitioners additional
period within which to file an Opposition and in view of the nature of
the case, which empowers the trial court to make orders expediting
proceedings.[49]
In the absence then of clear and convincing evidence to prove the
charge, a ruling not to inhibit oneself cannot just be overturned. [50] In
this case, petitioners failed to demonstrate such acts or
conduct clearly indicative of arbitrariness or prejudice as to thaw the
attributes of the cold neutrality of an impartial judge. Unjustified
assumptions and mere misgivings that the hand of prejudice, passion,
pride and pettiness moves the judge in the performance of his
functions are patently weak to parry the presumption that a judge shall
decide on the merits of a case with an unclouded vision of its facts.
In fine, the Court finds no grave abuse of discretion when public
respondent did not inhibit himself from hearing the case.

On the second issue, petitioners assail the Orders of August 21,

2007 and October 4, 2007 declaring them in default and denying their
motion to vacate order, respectively.
Rules of procedure, especially those prescribing the time within
which certain acts must be done, have often been held as absolutely
indispensable to the prevention of needless delays and to the orderly
and speedy discharge of business.[51]Section 5, Rule 108 of the Rules of
Court provides that [t]he civil registrar and any person having or
claiming any interest under the entry whose cancellation or correction
is sought may, within fifteen (15) days from notice of the petition, or
from the last date of publication of such notice, file his opposition
thereto. Records show that the notice was last published on July 26,
2007.[52]
The trial court pointed out that petitioners filed their entry of
appearance[53] without any attached Opposition to Ongs petition and
that, despite the grant to them of additional five days from August 7,
2007, they still failed to make a submission.Petitioners do not contest
the trial courts earlier observation that at the August 7, 2007 hearing,
petitioners counsel undertook to submit the Opposition within the
extended period and to appear at the next hearing, [54] where eventually
both their pleading and presence turned up unforthcoming.
Petitioners thereafter filed an Urgent Ex-Parte Motion to Vacate
the August 21, 2007 Order, insisting that the Omnibus Motion
presented a prejudicial issue that should have been resolved first
before the trial court proceeded with the case.Notably, in both the
Motion to Vacate Order and the Memorandum and/or Submission,
petitioners relied only on this ground and impliedly waived other
defenses or grounds for the lifting of the default order.
For a motion to lift an order of default to prosper, the following
requisites must concur: (1) it must be made by motion under oath by
one who has knowledge of the facts; (2) it must be shown that the
failure to file answer was due to fraud, accident, mistake or excusable
negligence; and (3) there must be a proper showing of the existence
of meritorious defense.[55]
As the trial court observed, the motion to vacate or set aside the
order of default failed to comply with paragraph (b), Section 3, Rule 9
of the Rules of Court,[56] it noting, inter alia, that the motion was not

under oath, it failed to explain or justify why movants have not filed
any opposition to the petition, and it was not accompanied by an
affidavit of merit.[57]
Indeed, a trial court has no authority to consider a motion to lift
the order of default where such motion was not made under oath.
[58]
Moreover, a motion to lift an order of default must allege with
particularity the facts constituting the fraud, accident, mistake or
excusable neglect which caused the failure to answer.[59]
In this case, petitioners unverified motion does not contain any
justifiable reason for their failure to file an appropriate responsive
pleading. Petitioners persistent stance on the pendency of their
Omnibus Motion deserves scant consideration in view of the recognition
of the nunc pro tunc order confirming the August 14, 2007 denial of
such motion.
Moreover, the filing of a motion for inhibition could not toll the
running of the reglementary period to file a responsive pleading, for
where a period is to be suspended by the filing of a pleading, the Rules
of Court expressly provides for such a suspension. [60] Despite the grant
of an extension of time, petitioners did not file an Opposition to Ongs
Petition, even one ex abundante ad cautelam that would have
sufficiently dealt with their concern over the alleged pending incident.
Further, petitioners failed to allege, much less demonstrate, a
meritorious defense or any argument to protect whatever interest they
may have under the entry which they resist to be corrected, either
embodied in a separate affidavit of merit or embedded in the verified
motion itself.[61] Petitioners would later admit that they are not real
adversarial litigants in the juridical sense as they are acting as judicial
monitors and observers.[62]
Velayo-Fong v. Velayo[63] discusses the meaning of meritorious
defense:
Moreover, when a party files a motion to lift order of
default, she must also show that she has a meritorious
defense or that something would be gained by having the
order of default set aside. The term meritorious defense
implies that the applicant has the burden of proving such a
defense in order to have the judgment set aside. The cases

usually do not require such a strong showing. The test

employed appears to be essentially the same as used in
considering summary judgment, that is, whether there is
enough evidence to present an issue for submission to
the trier of fact, or a showing that on the undisputed facts
it is not clear that the judgment is warranted as a matter of
law. The defendant must show that she has a meritorious
defense otherwise the grant of her motion will prove to be
a
useless
exercise. Thus, her
motion
must
be
accompanied by a statement of the evidence which
she intends to present if the motion is granted and
which is such as to warrant a reasonable belief that
the result of the case would probably be otherwise if a
new trial is granted.[64] (emphasis in the original)
Conjunctively, the glaring deficiencies negate the posture that
petitioners had no intention to delay the case and that their defenses, if
any, deserve to see the light of day in court. David v. GutierrezFruelda[65] did not countenance the failure to comply with the basic
requirements of a motion to lift an order of default. Accordingly, public
respondent did not arbitrarily declare them in default and deny their
motion to lift the order of default.
Respecting the trial courts Decision of October 24, 2007, petitioners
recapitulate their arguments against the inhibition and default orders to
conclude that the assailed decision is insupportable. [66] As lone ground,
petitioners posit that the special proceedings under Rule 108 do not fall
under the juridical concept of adversarial proceedings in the absence of
effective adversaries since the Office of the Civil Registrar is a formal
party while the Office of the Solicitor General sided with Ongs legal
position. Petitioners admit that they, while being parties in interest in
their capacity as judicial monitors and observers, are not real
adversarial litigants in the juridical sense.[67]
The
Court,
in Kilosbayan
Foundation
v.
Ermita,[68] stated
that substantial corrections to the nationality or citizenship of persons
recorded in the civil registry are effected through a petition filed in
court under Rule 108 of the Rules of Court.Jurisprudence has settled
that such proceedings are adversarial in nature or [o]ne having
opposing
parties;
contested,
as
distinguished
from
an ex

parte application, one which the party seeking relief has given legal
warning to the other party, and afforded the latter an opportunity to
contest it.[69] In this case, impleaded as defendants were the Civil
Registrar of San Juan, Metro Manila and any other person having or
claiming an interest under the entry sought to be corrected. The
interest of the State was amply represented by the Office of the
Solicitor General, while petitioners interest was deemed waived when
they failed to appear and file a responsive pleading.
Petitioners raise no additional ground to substantiate their imputation
of grave abuse of discretion on the part of public respondent insofar as
the issuance of the October 24, 2007 Decision is concerned. Since no
further issues were raised, the Court is precluded from making a
definitive pronouncement on the substantial aspect of the assailed
decision.
WHEREFORE, in light of all the foregoing, the petition is DISMISSED.
SO ORDERED.
Ching
G.R. No. 177086

December 5, 2012

ALBERT M. CHING and ROMEO J. BAUTISTA, Petitioners,

vs.
FELIX M. BANTOLO, ANTONIO O. ADRIANO and EULOGIO STA.
CRUZ JR., substituted by his children, represented by RAUL
STA. CRUZ JR., Respondents.
DECISION
DEL CASTILLO, J.:
"It is essential that for damages to be awarded, a claimant must
satisfactorily prove during the trial that they have a factual basis and
that the defendants acts have a casual connection to them"1
this Petition for Review on Certiorari2 under Rule 45 of the Rules of
Court assails the Decision3 dated July 31, 2006 and the

Resolution4 dated March 12, 2007 of the Court of Appeals (CA) in CAG.R. CV No. 79886.
Factual Antecedents
Respondents Felix M. Bantolo (Bantolo), Antonio O. Adriano and
Eulogio Sta Cruz,5 Jr. are owners of several parcels of land situated in
Tagaytay City, to wit:
Registered owner:
Felix M. Bantolo - Original Certificates of Title (OCT) Nos. 787, 788,
789 & 799
Antonio O. Adriano - OCT Nos. 793, 805, 806 & 807
Eulogio Sta. Cruz, Jr. - OCT Nos. 790, 791, 800 & 801.6
On April 3, 2000, respondents executed in favor of petitioners Albert
Ching (Ching) and Romeo J. Bautista a Special Power of Attorney
(SPA)7 authorizing petitioners to obtain a loan using respondents
properties as collateral. Pertinent portions of the SPA are reproduced
below:
1. To borrow money and apply for and secure a loan on their account
with any bank or financial institution in such sum or sums which the
herein Attorney-in-fact shall [deem] fit and advisable and the
maximum extent of which shall be the loanable value of our real
properties based on the attached appraisal report of Asian Appraisal
Co., Inc. dated March 24, 1995 on the "Fair Market Value Appraisal" of
said realties and/or parcels of land registered in our names
respectively in the Registry of Deeds of Tagaytay City and located
thereat, to wit:
Registrant
1. OCT NO. OP-790 Eulogio Sta. Cruz, Jr.

2. OCT NO. OP-791 -do3. OCT NO. OP-800 -do4. OCT NO. OP-801 -do5. OCT NO. OP-793 Antonio O. Adriano
6. OCT NO. OP-805 -do7. OCT NO. OP-806 -do8. OCT NO. OP-807 -do9. OCT NO. OP-787 Felix M. Bantolo
10. OCT NO. OP-788 -do11. OCT NO. OP-789 -do12. OCT NO. OP-799 do
the photocopies of which certificates of title are hereto attached and
made integral parts hereof, and we hereby authorize and/or vest
authority unto the herein attorney-in-fact to deed, convey, and
transfer by way of first mortgage all our rights of ownership and
interest over the said parcels as technically described in and covered
by the aforementioned original certificates of title in favor of any bank
or financial institution of their choice, judgment and discretion subject
to the usual conditions or such other terms which may be imposed by
said bank or financial institutions, in order to secure and ensure the
repayment of any loan indebtedness or obligation which our herein
attorneys-in-fact may obtain by virtue of this power and authority with
the further authority to receive the proceeds of such loan whether in
cash, check or other bills of exchange with the corresponding
obligation on the part of the attorney-in-fact to account for or render
an accounting of the loan proceeds to us or in our favor;

2. To sign, execute, and deliver any deed or deeds of real estate

mortgage over the aforestated parcels of land and the certificates
of title covering the same in favor of the lending bank or financial
institution or to secure any surety agreement, bond or
undertaking with any Surety Company who may issue a surety or
performance bond to ensure the repayment of any loan taken or
obtained by our herein Attorneys-in-fact pursuant to the herein
special power of attorney;
3. To do and perform any or all acts which may be necessary to
carry out and/or implement the foregoing powers and authority
vested by us unto aforenamed attorney-in-fact.
4. GIVING and GRANTING, as well as ratifying and confirming all
acts and things which our said Attorney-in-fact will do and
perform or has done and performed in or about the premises
which acts and things done or performed or still to be done or
performed are, for all legal intents and purpose are our own as if
we ourselves were personally present.8
Without notice to petitioners, respondents executed a Revocation of
Power of Attorney9 effective at the end of business hours of July 17,
2000.10
On July 18, 2000, the Philippine Veterans Bank (PVB) approved the
loan application of petitioner Ching in the amount of P25 million for a
term of five years subject to certain conditions, to wit:
1) Third party mortgages acceptable. Within one (1) year,
however, all mortgaged properties should be in the name of
American Boulevard or Albert Ching;
2) Submission of new tax declarations free from claimants;
3) Submission of certification/clearance from DENR that said
properties are not subject to forest reserve;

4) To require right of way of at least 6 meters wide which can be

used as an actual access road.11
On July 31, 2000, petitioner Ching thru a letter12 informed respondents
of the approval of the loan.13
Sometime in the first week of August 2000, petitioners learned about
the revocation of the SPA.14 Consequently, petitioners sent a letter15 to
respondents demanding that the latter comply with the agreement by
annulling the revocation of the SPA.16
On September 8, 2000, petitioners filed before the Regional Trial Court
(RTC) of Quezon City a Complaint17 for Annulment of Revocation of
SPA, Enforcement of SPA and/or interest in the properties covered by
said SPA and Damages against respondents. Petitioners later
amended18 the Complaint, docketed as Q00-41851, to include an
alternative prayer to have them declared as the owners of one-half of
the properties covered by the SPA.19
Petitioners alleged that the SPA is irrevocable because it is a contract
of agency coupled with interest.20According to them, they agreed to
defray the costs or expenses involved in processing the loan because
respondents promised that they would have an equal share in the
proceeds of the loan or the subject properties.21
In their Answer,22 respondents contended that petitioners have no
cause of action.23 Respondents alleged that they executed the SPA in
favor of petitioners because of their assurance that they would be able
to get a loan in the amount of P50 million and that P30 million would
be given to respondents within a months time.24 When the one-month
period expired, respondents complained to petitioner Ching and asked
him to advance the amount of P500,000.00.25 Petitioner Ching acceded
to their request on the condition that they hand over to him the
original titles for safekeeping.26 Respondents, in turn, asked petitioner
Ching to give them P1 million in exchange for the titles. 27 Petitioner
Ching agreed and so they gave him the titles.28 However, he never

gave them the money.29They asked him to return the titles, but he
refused.30 Later, they were informed that the loan was approved in the
amount of P25 million and that their share would be P6 million.31 Since
it was not the amount agreed upon, respondents revoked the SPA and
demanded the return of the titles.32
Ruling of the Regional Trial Court
On December 18, 2002, the RTC rendered a Decision 33 in favor of
petitioners. It upheld the validity of the SPA and declared its
revocation illegal and unjust.34 But although the SPA was declared
valid, the RTC held that it could no longer be enforced because the
circumstances present at the time of its execution have changed.35 For
this reason, the RTC found respondents liable for all the damages
caused by the illegal revocation.36 The RTC also declared petitioners
owners of one-half of the subject properties.37 As to the deficiency in
the payment of the docket fees, if any, the RTC ruled that it would be
considered a lien on the judgment.38 Thus:
WHEREFORE, premises considered, judgment is hereby rendered
declaring the [petitioners] to be the owners of 50% or one-half, proindiviso, of all the parcels of lands covered by OCT Nos. OP-787, OP788, OP-789, OP-799, OP-793, OP-805, OP-806, OP-807, OP-790, OP791, OP-800 and OP-801.
Furthermore, [respondents] are ordered to pay [petitioners] jointly
and solidarily the following sums, to wit:
1. As actual damages:
a. The amount covered by the receipts which the
[petitioners] used in procuring the loan after the SPA was
executed amounting to P949,960.40; and
b. The amount of P500,000.00 as actual damages for the
amount paid out to the [respondents] in exchange for the
original certificates of title;

2. As moral damages, the amount of Php500,000.00 in favor [of]

Albert M. Ching;
3. As exemplary damages, the amount of Php100,000.00; and
4. As attorneys fees, the amount of Php100,000.00.
No costs.
SO ORDERED.39
Aggrieved, respondents elevated the case to the CA.
Pending appeal, a Motion for Intervention with attached Petition-inIntervention40 was filed by First Aikka Development, Inc. and Sadamu
Watanabe. They alleged that respondents individually executed Deeds
of Irrevocable SPAs authorizing Tagaytay and Taal Management
Corporation (TTMC), represented by its Japanese President Wataru
Minagawa, to sell, lease, mortgage, or administer the subject
properties;41 and that by virtue of the said SPAs, they entered into a
Memorandum of Agreement and a Supplement to Memorandum of
Agreement with respondents and TTMC, whereby respondents agreed
to sell the subject property to them.42 Thus, they prayed that the
Decision of the RTC be vacated and set aside, and that judgment be
rendered in their favor.43
Ruling of the Court of Appeals
On June 15, 2004, the CA issued a Resolution44 denying the Motion for
Intervention for being filed out of time.
On July 31, 2006, the CA modified the Decision of the RTC. The CA
ruled that petitioners are not entitled to one-half of the subject
properties because it is contrary to human experience for a person to
give one-half of his property to someone he barely knows.45 The CA
likewise ruled that petitioners are not entitled to reimbursement
because they failed to show that the receipts presented in evidence

were incurred in relation to the loan application. 46 As to the award of

exemplary damages, the CA deleted the same because respondents
did not act in a wanton, fraudulent, reckless, oppressive or malevolent
manner.47 The decretal portion of the CA Decision reads:
WHEREFORE, premises considered, the assailed decision is
hereby MODIFIED as follows:
1. The Revocation of the Power of Attorney executed by the
[respondents] is hereby declared null and void. The Special
Power of Attorney dated April 3, 2000 is considered valid and
subsisting;
2. The amount of P500,000.00 paid by the [petitioner] Ching to
the [respondents] should be deducted from the amount to be
loaned;
3. The expenses incurred and to be incurred in the processing of
the loan application must be borne by the [petitioners] alone;
4. The [petitioners] are not entitled to the one-half of all the
parcerls of land covered by OCT Nos. OP-787, OP-788, OP-789,
OP-799, OP-793, OP- 805, OP-806, OP-807, OP-790, OP-791,
OP-800 and OP-801; and
5. The award of moral damages in the amount of P500,000.00
and attorneys fees in the amount of P100,000.00 are in order.
The award of exemplary damages is deleted.
SO ORDERED.48
Petitioners moved for reconsideration but the CA denied the same in a
Resolution49 dated March 12, 2007.
Issues
Hence, this petition raising the following issues:

A.
WHETHER X X X THE [CA] ERRED IN RULING THAT PETITIONERS
RECOVERY OF THE ACTUAL DAMAGES IN THE AMOUNT OF
PHP500,000.00 BE MADE CONTINGENT UPON THE OBTENTION
OF A LOAN THROUGH THE SUBJECT SPECIAL POWER OF
ATTORNEY, WHICH THE RESPONDENTS, IN THE FIRST PLACE,
REFUSED TO HONOR AND REVOKED IN BAD FAITH AND
ILLEGALLY.
B.
WHETHER X X X THE [CA] ERRED IN RULING THAT THE
PETITIONERS ARE NOT ENTITLED TO ONE-HALF OF THE
RESPONDENTS PROPERTIES DESPITE THE FINDING OF THE
[RTC] THAT THE CONSIDERATION THEREFOR WAS THAT THE
PETITIONERS SHALL PAY FOR THE LOAN TO BE OBTAINED
UTILIZING THE RESPONDENTS PROPERTIES AND THE FINDING
OF THE [RTC] THAT PETITIONER CHING, TO HIS GRAVE
PREJUDICE, FAILED TO UTILIZE THE PROCEEDS OF THE LOAN
FOR THE LATTERS BUSINESS PLAN AS WELL AS TO RECOVER
HIS SHARE IN THE EXPENSES, WHICH PETITIONER CHING
ADVANCED IN PROCURING THE LOAN.
C.
WHETHER X X X THE [CA] ERRED IN RULING THAT THE
EXPENSES INCURRED AND TO BE INCURRED BY THE
PETITIONERS IN APPLYING FOR A LOAN THROUGH THE SPA
SHOULD BE BORNE BY THE PETITIONER[S] DESPITE THE
EXISTENCE OF AN AGREEMENT TO THE CONTRARY BETWEEN
THE PETITIONERS AND RESPONDENTS, THE EXISTENCE OF
WHICH AGREEMENT WAS DULY FOUND BY THE [RTC].
D.

WHETHER X X X THE [CA] ERRED IN RULING THAT

RESPONDENTS ARE NOT LIABLE TO PAY EXEMPLARY DAMAGES
FOR REVOKING THE SPA IN BAD FAITH ON THE RATIOCINATION
THAT THE RESPONDENTS DID NOT ACT IN A WANTON,
FRAUDULENT, RECKLESS, OPPRESSIVE OR MALEVOLENT
MANNER BECAUSE THE RESPONDENTS WERE PURPORTEDLY
UNSATISFIED WITH THE AMOUNT OF THE LOAN APPROVED.50
Petitioners Arguments
Petitioners, in essence, seek the reinstatement of the Decision of the
RTC.51 They contend that the CAs directive that the actual damages in
the amount of P500,000.00 be deducted from the amount to be
loaned, is a conditional judgment, and thus, null and void.52 In
addition, they claim that they are entitled to one-half of the subject
properties,53 and to reimbursement of all expenses incurred in
procuring the loan.54 Finally, they impute error on the part of the CA in
deleting the award for exemplary damages, contending that the
revocation was done by respondents in a malevolent and oppressive
manner.55
Respondents Arguments
Respondents, on the other hand, argue that the judgment was not
conditional because the CA categorically declared respondents liable to
return the amount of P500,000.00 to petitioner Ching.56 They insist
that they never agreed to give petitioners one-half of their respective
properties.57 Neither did they agree to reimburse petitioner Ching all
the expenses incurred in obtaining the loan.58 Petitioner Ching, in fact,
admitted in court that he agreed to shoulder all the expenses. 59 Also,
petitioners are not entitled to exemplary damages because when
respondents revoked the SPA, they did not act in a wanton, fraudulent,
reckless, oppressive or malevolent manner.60
Our Ruling
The petition is partly meritorious.

There is no question that the SPA executed by respondents in favor of

petitioners is a contract of agency coupled with interest.61 This is
because their bilateral contract depends upon the agency.62 Hence, it
"cannot be revoked at the sole will of the principal."63
The only issue therefore is the extent of the liability of respondents
and the damages to be awarded to petitioners.
Petitioner Ching is entitled to actual
damages in the amount of P500,000.00
without any condition.
In exchange for his possession of the titles, petitioner Ching advanced
the amount of P500,000.00 to respondents. Considering that the loan
application with PVB did not push through, respondents are liable to
return the said amount to petitioner Ching.
In ordering the award of P500,000.00, the CA decreed:
2. The amount of P500,000.00 paid by the [petitioner] Ching to the
[respondents] should be deducted from the amount to be loaned;64
Obviously, the language employed by the CA made the judgment
conditional. The return of the amount of P500,000.00 should not
depend on the happening of a future event.65 Whether or not a loan is
obtained by petitioners, respondents are liable to pay the amount of
P500,000.00 as actual damages. Thus, the dispositive portion of the
CA Decision should be modified by ordering respondents to pay actual
damages in the amount of P500,000.00, without any condition.
Petitioners are not entitled to one-half
of the subject properties.
As to petitioners claim to one-half of the subject properties, we agree
with the CA that:

x x x it is far from human experience that a person will give half of his
property to another person whom he barely knows. It is clear from the
records of the case that the [respondents] do not know [petitioner]
Ching. It was [petitioner] Bautista who introduced him to [respondent]
Bantolo. The [respondents] agreed to give an SPA to Ching, because
they were informed that the latter could help them secure a loan with
their pieces of property as collateral. No one in his right mind would
definitely agree to give half of his property to another. It is certain that
they agreed that they would share in the proceeds of the loan but not
in the property. Hence, [petitioners] are not entitled to one-half
of the property.[66 (Emphasis supplied)
In fact, other than petitioner Chings self-serving testimony,67 no
evidence was presented to show that respondents agreed to give onehalf of the properties to petitioners.
Petitioners are not entitled to
reimbursement of all the expenses
incurred in obtaining a loan.
Petitioner Ching testified in court that he agreed to shoulder all the
expenses, to wit:
Atty. Figueroa:
Mr. Witness, during your testimony in the last hearing, you said that
[respondent] Bantolo approached you and proposed a business
transaction with you, basically using a property, parcels of land, as
collateral for a bank loan, which you are supposed to take care of.
Now, you also testified in the last hearing that you will personally take
care of the [loan application], and in fact, this loan application was
approved by Philippine Veterans Bank. Now, by way of recapitulation,
Mr. Witness, can you please tell us who will shoulder the expenses that
will be incurred in the processing of this loan application?
A - I will shoulder everything.

Q - But you have an agreement with [respondent] Bantolo, and

pursuant to this agreement, Mr. Witness, once the application for loan
was approved, what will happen?
A - According to him, we will share 50-50 [in] the amount that we will
pay and I have the option to choose between the money, if the same is
small [or] to take the 50% of the property.
Q - That sharing agreement, Mr. Witness, is premised on the condition
that the loan application will be approved. What happens, now, Mr.
witness, if the loan is not approved by the bank[?] What happens
specifically to the expenses that you have incurred in the processing of
the loan application[?]
Atty. Noel:
Objection, your Honor. That question was already asked. In fact, the
witness started on a general term, without any condition, that he will
shoulder all the expenses. He did not qualify whether the loan will be
approved or not. It has been answered already.
Court:
We are at the stage of direct examination. In the interest of truth, you
answer.
A - I asked them about that but they told me that they dont have
money to pay me, so I shouldered all the expenses. I took the
risk of shouldering all the expenses.
Atty. Figueroa:
You said you took the risk.1wphi1 Will you be more specific what do
you mean by this risk that you took, as far as the expenses are
concerned?

A - What I mean, sir, is that I will not be able to recover all my

expenses if the loan is not granted by the Philippine Veterans
Bank.[68 (Emphasis supplied)
For this reason, we find that petitioners are not entitled to the
reimbursement of the expenses they have incurred in applying for the
loan.
Besides, petitioners failed to show that the receipts submitted as
evidence were incurred in relation to the loan application.69 As aptly
pointed out by the CA, majority of the receipts were incurred abroad
and in connection with petitioner Chings business dealings.70
Petitioners are not entitled to exemplary damages.
Neither are petitioners entitled to exemplary damages.
Article 222971 of the Civil Code provides that exemplary damages may
be imposed "by way of example or correction for the public good, in
addition to the moral, temperate, liquidated or compensatory
damages." They are, however, not recoverable as a matter of
right.72 They are awarded only if the guilty party acted in a wanton,
fraudulent, reckless, oppressive or malevolent manner.73
In this case, we agree with the CA that although the revocation was
done in bad faith, respondents did not act in a wanton, fraudulent,
reckless, oppressive or malevolent manner. They revoked the SPA
because they were not satisfied with the amount of the loan approved.
Thus, petitioners are not entitled to exemplary damages.
WHEREFORE, the petition is hereby partially GRANTED. The assailed
Decision dated July 31, 2006 and the Resolution dated March 12, 2007
of the Court of Appeals in CA-G.R. CV. No. 79886 are hereby
AFFIRMED with MODIFICATION that respondents are ordered to pay
petitioner Ching actual damages in the amount of P500,000.00.
SO ORDERED:

Pan Pacific
PAN PACIFIC INDUSTRIAL G.R. No. 125283
SALES CO., INC.,
Petitioner, Present:
QUISUMBING, J.,
Chairman,
- versus - CARPIO,
CARPIO-MORALES, and
TINGA, JJ.
COURT OF APPEALS and
NICOLAS CAPISTRANO, Promulgated:
Respondents.
February 10, 2006
x---------------------------------------------------------------------------x
DECISION
TINGA, J.:
Petitioner Pan Pacific Industrial Sales Co., Inc. (Pan Pacific) filed the
instant Petition
for
Review
on
Certiorari [1] assailing
the Decision[2] dated 4 June 1996 of the Court of Appeals Fourteenth
Division
in
C.A.
G.R.
No.
CV-41112.
The
challenged Decision affirmed in
toto the Decision[3] dated 24
April
1992 of the Regional Trial Court (RTC) of Manila, Branch 18 in Civil
Case No. 88-46720.
The case arose when on 22 December 1988, private respondent
Nicolas Capistrano (Capistrano) filed an Amended Complaint[4] before
the RTC of Manila against Severo C. Cruz III (Cruz), his spouse
Lourdes Yap Miranda, and Atty. Alicia Guanzon, [5] pleading two causes
of action.[6]
The first cause of action is for the nullification, or alternatively, for the
rescission, of a Deed of Absolute Sale[7] covering a parcel of land that
Capistrano owned, located at 1821 (Int.), Otis Street (now Paz
Guanzon Street), Paco, Manila, and covered by Transfer Certificate of

Title (TCT) No. 143599 to Cruz.[8] This is the subject lot. Capistrano
denied having executed the deed.
The second cause of action is for the rescission of another agreement
with an alternative prayer for specific performance. Capistrano alleged
that he agreed to sell another parcel of land in the same vicinity to
Cruz. According to Capistrano, Cruz only paid P100,000.00 of the
stipulated purchase price, thereby leaving P250,000.00 still unpaid.[9]
The operative facts follow.
On 10 September 1982, Capistrano executed a Special Power of
Attorney[10] authorizing Cruz to mortgage the subject lot in favor of
Associated Bank (the Bank) as security for the latters loan
accommodation.[11]
Shortly, by virtue of the Special Power of Attorney, Cruz obtained
a loan in the amount of P500,000.00 from the Bank. Thus, he
executed a Real Estate Mortgage[12] over the subject lot in favor of the
Bank.[13]
Capistrano and Cruz then executed a letter-agreement dated 23
September 1982 whereby Cruz agreed to buy the subject lot for the
price of P350,000.00, of which P200,000.00 would be paid out of the
loan secured by Cruz, and the balance of P150,000.00 in eight (8)
quarterly payments of P18,750.00 within two (2) years from 30
October 1982, without need of demand and with interest at 18% in
case of default.[14]
On 15 March 1983, Capistrano executed the Deed of Absolute
Sale[15] over the subject lot in favor of Cruz. Two (2) days later, on 17
March 1983, Notary Public Vicente J. Benedicto (Benedicto) notarized
the deed. However, it was earlier or on 9 March 1983 that Capistranos
wife,
Josefa
Borromeo
Capistrano,
signed
the Marital
[16]
Consent
evidencing her conformity in advance to the sale.
The Marital Consent was also sworn to before Benedicto.
Following the execution of the deed of sale, Cruz continued payments
to Capistrano for the subject lot. Sometime in October 1985,
Capistrano delivered to Cruz a Statement of Account[17] signed by
Capistrano, showing that as of 30 October 1985, Cruzs balance stood

at P19,561.00 as principal, and P3,520.98 as interest, or a total

of P23,081.98.
Thus, in May 1987, with the mortgage on the subject lot then being in
danger of foreclosure by the Bank, Cruz filed a case with the RTC of
Manila, Branch 11, docketed as Civil Case No. 87-40647, to enjoin the
foreclosure. Cruz impleaded Capistrano and his spouse Josefa
Borromeo Capistrano as defendants, the title to the subject lot not
having been transferred yet to his name.[18]
Cruz also devised a way to save the subject lot from foreclosure by
seeking a buyer for it and eventually arranging for the buyer to pay
the mortgage debt. Towards this end, Cruz succeeded in engaging Pan
Pacific. Thus, on 22 September 1988, Pan Pacific paid off Cruzs debt in
the amount of P1,180,000.00.[19] Consequently, on 23 September
1988, the Bank executed a Cancellation of Real Estate Mortgage.[20] On
even date, Cruz executed a Deed of Absolute Sale[21] over the subject
lot in favor of Pan Pacific, attaching thereto the previous Deed of
Absolute Sale executed by Capistrano in favor of Cruz.
Surprisingly, on 20 October 1988, Capistrano filed a Revocation of
Special Power of Attorney[22] with the Register of Deeds of Manila. Less
than a week later, Capistrano sent the Register of Deeds another letter
informing said officer of his having come to know of the sale of the
subject lot by Cruz to Pan Pacific and requesting the officer to withhold
any action on the transaction.[23]
Before long, in November 1988, Capistrano filed the precursory
complaint before the Manila RTC in Civil Case No. 88-46720.
Pan Pacific, which bought the subject lot from the Cruz spouses, was
allowed to intervene in the proceedings and joined Cruz, et al. in
resisting the complaint insofar as the first cause of action on the
subject lot is concerned.[24]
Then on 24 April 1992, a Decision was rendered by the trial court in
favor of Capistrano on both causes of action, the dispositive portion of
which reads as follows:
WHEREFORE, judgment is hereby rendered in favor of the
plaintiff and against the defendant, Severo E. (sic) Cruz III,

his spouse, Lourdes Miranda Cruz, and the intervenor, Pan

Pacific Industrial Sales Co., Inc., as follows:
1. Declaring the Letter-Agreement, dated September 23,
1982, Exhibit C, as resolved and/or rescinded;
2. Declaring both the Deed of Absolute Sale, Exhibit H, and
the document entitled, Marital Consent, Exhibit K, null and
void;
3. Declaring the Deed of Absolute Sale executed by the
spouses Severo C. Cruz, III and Lourdes Miranda Cruz in
favor of the intervenor, Pan Pacific Industrial Sales, Co.,
Inc., Exhibit 8, null and void;
4. Making the writ of preliminary injunction issued by this
Court on November 23, 1988, permanent;
5. Ordering the intervenor, thru its legal counsel and
corporate secretary, Atty. Senen S. Burgos, who has
possession of the owners copy of TCT No. 143599 of the
Register of Deeds of Manila, in the name of the plaintiff, to
surrender the same to this Court within ten days from
finality of the decision for turn over to the plaintiff;
6. Ordering Defendant Register of Deeds of Manila to reject
and not give due course to the documents submitted to it,
which have for their purpose the transfer of the real estate
property covered by TCT No. 143599 from the name of the
plaintiff to Defendant Cruz and/or to the intervenor; and
7. Ordering the spouses Severo C. Cruz, III and Lourdes
Miranda Cruz to pay the plaintiff the sum of P69,561.00 as
net amount due to the latter as per the computation in the
end-part of this decision.
The counterclaims of both Severo C. Cruz, III and spouse,
and of the intervenor, Pan Pacific Industrial Sales Co., Inc.,
are both dismissed, for lack of merit.
Double costs against the defendants-Cruz spouses.

SO ORDERED.[25]

To arrive at the conclusion that the first Deed of Absolute Sale and
the Marital Consent are spurious, the trial court mainly relied on
Capistranos disavowal of his signature and that of his wifes, together
with extrinsic factors which in its opinion evinced the spuriousness.
Pan Pacific and the Cruz spouses interposed separate appeals to the
Court of Appeals, their common concern being the trial courts finding
that the Deed of Absolute Sale and the Marital Consent were spurious.
[26]

In assailing this finding, Pan Pacific and the Cruz spouses contended
that Capistrano failed to present clear and convincing evidence to
overturn the presumption of regularity of public documents like the
documents in question.[27]
The Court of Appeals affirmed the RTC Decision. Concerning the
subject lot, it held that while a notarial document cannot be disproved
by the mere denial of the signer, the denial in this case should be
taken together with the other circumstances of the case which in sum
constitute clear and convincing evidence sufficient to overcome the
presumption of regularity of the documents.[28]
The Cruz spouses did not elevate the Court of Appeals Decision to this
Court. Thus, the RTC Decision became final as to them.
Pan Pacific, however, filed the instant Petition solely concerning the
first cause of action in the Amended Complaint. Pan Pacific contends
that the genuineness and due execution of the Deed of Absolute
Sale and Marital Consent cannot be overridden by the self-serving
testimony of Capistrano. It stresses that the trial court cannot rely on
irrelevant extrinsic factors to rule against the genuineness of the deed.
[29]
Finally, it points out that Capistrano cannot contest the sale of the
subject lot to Cruz, as the sale had already been consummated.[30]

For his part, Capistrano posits in his Memorandum[31] that Pan Pacific is
not an innocent purchaser for value and in good faith as Cruz was
never the registered owner of the subject lot. Pan Pacific was bound at
its peril to investigate the right of Cruz to transfer the property to it.
Moreover, Capistrano asserts that the legal presumption of regularity
of public documents does not obtain in this case as the documents in
question were not properly notarized. He adds that the parties never
appeared before the notary public as in fact the deed had only been
delivered by Capistrano to the house of Cruzs mother.
Furthermore, Capistrano maintains that his spouses signature on
the Marital Consent is a forgery as it was virtually impossible for her to
have signed the same. Lastly, Capistrano disputes Cruzs assertion that
the sale had been consummated, pointing out that the Amended
Complaint consisted of two (2) causes of action pertaining to two (2)
separate lots, and Cruz had only paid P100,000.00 of the total price of
the lot subject of the second cause of action.
The petition is imbued with merit.
Pan Pacific disputes the common conclusion reached by the courts
below that the presumption of regularity of the Deed of Absolute
Sale and the Marital Consent, which in its estimation are both public
documents, has been rebutted by Capistranos countervailing evidence.
The correctness of the conclusions on the alleged spuriousness of the
documents in question drawn by the courts below from the facts on
record is before this Court. The issue is a question of law cognizable by
the Court.[32]
Deeply embedded in our jurisprudence is the rule that notarial
documents celebrated with all the legal requisites under the safeguard
of a notarial certificate is evidence of a high character and to overcome
its recitals, it is incumbent upon the party challenging it to prove his
claim with clear, convincing and more than merely preponderant
evidence.[33]
A notarized document carries the evidentiary weight conferred upon it
with respect to its due execution, and it has in its favor the
presumption of regularity which may only be rebutted by evidence so
clear, strong and convincing as to exclude all controversy as to the
falsity of the certificate. Absent such, the presumption must be upheld.

The burden of proof to overcome the presumption of due execution of

a notarial document lies on the one contesting the same. Furthermore,
an allegation of forgery must be proved by clear and convincing
evidence, and whoever alleges it has the burden of proving the same.
[34]

Evidently, as he impugns the genuineness of the documents,

Capistrano has the burden of making out a clear-cut case that the
documents are bogus. The courts below both concluded that
Capistrano had discharged this burden. However, this Court does not
share the conclusion. Indeed, Capistrano failed to present evidence of
the forgery that is enough to overcome the presumption of
authenticity.
To support the allegation of the spuriousness of his signature on
the Deed of Absolute Sale and that of his wife on the Marital Consent,
Capistrano relied heavily on his bare denial, at the same time taking
sanctuary behind other circumstances which supposedly cast doubt on
the authenticity of the documents. Capistrano did not bother to
present corroborating witnesses much less an independent expert
witness who could declare with authority and objectivity that the
challenged signatures are forged. It befuddles the Court why both the
courts below did not find this irregular considering that the Court has
previously declared in Sy Tiangco v. Pablo and Apao ,,[35] that the
execution of a document that has been ratified before a notary public
cannot be disproved by the mere denial of the alleged signer.
The case of Chilianchin v. Coquinco[36] also finds application in this
regard wherein we stated that:
As the lower court correctly said, the plaintiff did not even
present a sample of his authentic signature to support his
contention that it is not his the (sic) signature appearing
in said document. He did not call a handwriting expert to
prove his assertion. His attorney, at the beginning of the
trial, made it of record that if the defendant present an
expert in hand-writing to show that the signature in
question is genuine, the plaintiff will also present an
expert to the contrary, as if it were incumbent upon the
defendant to show that the signature of the plaintiff in
Exhibit A is genuine . . . .[37]

Corollarily, he who disavows the authenticity of his signature on a

public document bears the responsibility to present evidence to that
effect. Mere disclaimer is not sufficient. At the very least, he should
present corroborating witnesses to prove his assertion. At best, he
should present an expert witness.
On the other hand, the Court cannot understand why an unfavorable
inference arose not from Capistranos but from Cruzs failure to have
the documents examined by an expert witness of the National Bureau
Investigation (NBI) and to present the notary public as witness.
Specifically, the courts below took Cruzs inability to obtain the NBI
examination of the documents as he had somehow undertaken as an
indication that the documents are counterfeit.[38]
The courts below may have forgotten that on Capistrano lies the
burden to prove with clear and convincing evidence that the notarized
documents are spurious. Nothing in law or jurisprudence reposes on
Cruz the obligation to prove that the documents are genuine and duly
executed. Hence it is not incumbent upon Cruz to call the notary public
or an expert witness. In contrast, Capistrano should have called the
expert witness, the notary public himself or the witnesses to the
document to prove his contention that he never signed the deed of
sale, that its subscribing witnesses never saw him sign the same, and
that he never appeared before the notary public before whom the
acknowledgment was made.

In fact, there is no evidence that the notarization of the documents did

not take place. All that Capistrano could say on this matter was that he
had not seen Benedicto, the notary public.[39] The assertion that the
parties to the deed never appeared before the notary public is not
supported by evidence either. The courts below drew an inference to
that effect from Cruzs testimony that the deed of sale was dropped or
delivered to his mothers house.[40] That is not a reasonable deduction
to make as it is plainly conjectural. No conclusion can be derived
therefrom which could destroy the genuineness of the deed. The
testimony means what it declares: that the copy of the deed was
dropped at the house of Cruzs mother. That is all.

Nor can the Court lend credence to the thinking of the courts below
that since Cruz had a balance of P132,061.00 owing to Capistrano as
of the date of the deed of sale, the latter could not have possibly
executed the deed. This is plain guesswork. From the existence of
Cruzs outstanding balance, the non-existence of the deed of sale does
not necessarily follow.
Indeed, a vendor may agree to a deed of absolute sale even before full
payment of the purchase price. Article 1478 of the Civil Code states
that the parties may stipulate that ownership in the thing shall not
pass to the purchaser until he has fully paid the price. A sensu
contrario, the parties may likewise stipulate that the ownership of the
property may pass even if the purchaser has not fully paid the price.
The courts below also assigned an adverse connotation to Cruzs
impleading of the Capistrano spouses as party-defendants in the action
against the Bank to enjoin the foreclosure of the mortgage on the
subject lot. Cruzs move is congruent with both his strong desire to
protect his interest in the subject lot and the reality that there was an
existing deed of sale in his favor. Precisely, his interest in the lot is
borne out and had arisen from the deed of sale. As purchaser of the
lot, he had to avert the foreclosure of the mortgage thereon. And to
ensure against the dismissal of the action for failure to join a real
party-in-interest, he had to implead Capistrano in whose name the title
to the subject lot was registered still.
Apart from Capistranos abject failure to overcome the presumption of
regularity and genuineness with which the Deed of Absolute Sale is
impressed as a public document, Capistranos cause is eviscerated by
his own acts in writing before and after the execution of the deed. Said
written acts constitute indelible recognition of the existence and
genuineness of the Deed of Absolute Sale.
First is the letter-agreement[41] dated 23 September 1982 made and
signed by Capistrano in favor of Cruz, which the latter also signed
subsequently, stating that Cruz will, as he did, purchase the subject lot
for P350,000.00 to be paid according to the terms provided therein.
Second is the Statement of Account[42] signed by Capistrano, which he
delivered to Cruz, showing that as of 30 October 1985, Cruzs balance

of the stipulated purchase price consisted of P19,561.00 as principal

and P3,520.98 as interest, or a total of P23,081.98.
Third is Capistranos Amended Complaint itself which illustrates his own
manifest uncertainty as to the relief he was seeking in court. He
demanded that the Deed of Absolute Sale be nullified yet he prayed in
the same breath for the rescission of the same [43]evidently, a selfdefeating recognition of the contract. In asking for rescission,
Capistrano obviously was invoking Article 1191 of the Civil Code which
provides that the power to rescind, which really means to resolve or
cancel, is implied in reciprocal obligations in case one of the obligors
should not comply with what is incumbent upon him. When a party
asks for the resolution or cancellation of a contract it is implied that he
recognizes its existence. A non-existent contract need not be
cancelled.
These are unmistakable written admissions of Capistrano that he really
intended to sell the subject lot to Cruz and that he received payments
for it from the latter as late as the year 1985. It is thus a little baffling
why in 1988, he decided to disown the Deed of Absolute Sale. The
most plausible explanation for his sudden change of mind would be his
belated realization that he parted with the subject lot for too small an
amount (P350,000.00), compared to the price pegged by Cruz
(P1,800,000.00) in the sale to Pan Pacific.
Now, to the Marital Consent. The fact that the document contains a
jurat, not an acknowledgment, should not affect its genuineness or
that of the related document of conveyance itself, the Deed of Absolute
Sale. In this instance, a jurat suffices as the document only embodies
the manifestation of the spouses consent,[44] a mere appendage to the
main document.
The use of a jurat, instead of an acknowledgement does not elevate
the Marital Consent to the level of a public document but instead
consigns it to the status of a private writing. [45] The lack of
acknowledgment, however, does not render a deed invalid. The
necessity of a public document for contracts which transmit or
extinguish real rights over immovable property, as mandated by Article
1358 of the Civil Code, is only for convenience; it is not essential for
validity or enforceability.[46]

Fuentes
MANUEL O. FUENTES and G.R. No. 178902
LETICIA L. FUENTES,
Petitioners, Present:
Puno, C.J.,
Carpio,
Corona,
Carpio Morales,
Velasco, Jr.,
Nachura,
- versus - Leonardo-De Castro,
Brion,
Peralta,
Bersamin,
Del Castillo,
Abad,
Villarama, Jr.,
Perez, and
Mendoza, JJ.
CONRADO G. ROCA, ANNABELLE R.
JOSON, ROSE MARIE R. CRISTOBAL
and PILAR MALCAMPO, Promulgated:
Respondents.
April 21, 2010
x
--------------------------------------------------------------------------------------- x
DECISION
ABAD, J.:
This case is about a husbands sale of conjugal real property,
employing a challenged affidavit of consent from an estranged
wife. The buyers claim valid consent, loss of right to declare nullity of
sale, and prescription.

The Facts and the Case

Sabina Tarroza owned a titled 358-square meter lot in
Canelar, Zamboanga City. On October 11, 1982 she sold it to her son,
Tarciano T. Roca (Tarciano) under a deed of absolute sale. [1] But
Tarciano did not for the meantime have the registered title transferred
to his name.
Six years later in 1988, Tarciano offered to sell the lot to petitioners
Manuel and Leticia Fuentes (the Fuentes spouses). They arranged to
meet at the office of Atty. Romulo D. Plagata whom they asked to
prepare the documents of sale. They later signed an agreement to sell
that Atty. Plagata prepared[2] dated April 29, 1988, which agreement
expressly stated that it was to take effect in six months.
The agreement required the Fuentes spouses to pay Tarciano a
down payment of P60,000.00 for the transfer of the lots title to
him. And, within six months, Tarciano was to clear the lot of structures
and occupants and secure the consent of his estranged wife, Rosario
Gabriel Roca (Rosario), to the sale. Upon Tarcianos compliance with
these conditions, the Fuentes spouses were to take possession of the
lot and pay him an additional P140,000.00 or P160,000.00, depending
on whether or not he succeeded in demolishing the house standing on
it. If Tarciano was unable to comply with these conditions, the Fuentes
spouses would become owners of the lot without any further formality
and payment.
The parties left their signed agreement with Atty. Plagata who then
worked on the other requirements of the sale. According to the lawyer,
he went to see Rosario in one of his trips to Manila and had her sign an
affidavit of consent.[3] As soon as Tarciano met the other conditions,
Atty.
Plagata
notarized Rosarios
affidavit
in Zamboanga City. On January 11, 1989 Tarciano executed a deed of
absolute sale[4] in favor of the Fuentes spouses. They then paid him
the additional P140,000.00 mentioned in their agreement. A new title
was issued in the name of the spouses [5] who immediately constructed
a building on the lot. On January 28, 1990 Tarciano passed away,
followed by his wife Rosario who died nine months afterwards.

Eight years later in 1997, the children of Tarciano and Rosario, namely,
respondents Conrado G. Roca, Annabelle R. Joson, and Rose Marie R.
Cristobal, together with Tarcianos sister, Pilar R. Malcampo,
represented by her son, John Paul M. Trinidad (collectively, the Rocas),
filed an action for annulment of sale and reconveyance of the land
against the Fuentes spouses before the Regional Trial Court (RTC) of
Zamboanga City in Civil Case 4707. The Rocas claimed that the sale to
the spouses was void since Tarcianos wife, Rosario, did not give her
consent to it. Her signature on the affidavit of consent had been
forged. They thus prayed that the property be reconveyed to them
upon reimbursement of the price that the Fuentes spouses paid
Tarciano.[6]
The spouses denied the Rocas allegations. They presented Atty.
Plagata who testified that he personally saw Rosario sign the affidavit
at her residence in Paco, Manila, on September 15, 1988. He admitted,
however, that he notarized the document in Zamboanga City four
months later on January 11, 1989.[7] All the same, the Fuentes
spouses pointed out that the claim of forgery was personal
to Rosario and she alone could invoke it. Besides, the four-year
prescriptive period for nullifying the sale on ground of fraud had
already lapsed.
Both the Rocas and the Fuentes spouses presented handwriting
experts at the trial. Comparing Rosarios standard signature on the
affidavit with those on various documents she signed, the Rocas expert
testified that the signatures were not written by the same person.
Making the same comparison, the spouses expert concluded that they
were.[8]
On February 1, 2005 the RTC rendered judgment, dismissing the
case. It ruled that the action had already prescribed since the ground
cited by the Rocas for annulling the sale, forgery or fraud, already
prescribed under Article 1391 of the Civil Code four years after its
discovery. In this case, the Rocas may be deemed to have notice of the
fraud from the date the deed of sale was registered with the Registry
of Deeds and the new title was issued. Here, the Rocas filed their
action in 1997, almost nine years after the title was issued to the
Fuentes spouses on January 18, 1989.[9]
Moreover, the Rocas failed to present clear and convincing evidence of
the fraud. Mere variance in the signatures of Rosario was not
conclusive proof of forgery.[10] The RTC ruled that, although the Rocas

presented a handwriting expert, the trial court could not be bound by

his opinion since the opposing expert witness contradicted the
same. Atty. Plagatas testimony remained technically unrebutted.[11]
Finally, the RTC noted that Atty. Plagatas defective notarization of the
affidavit of consent did not invalidate the sale. The law does not
require spousal consent to be on the deed of sale to be valid. Neither
does the irregularity vitiate Rosarios consent.She personally signed the
affidavit in the presence of Atty. Plagata.[12]
On appeal, the Court of Appeals (CA) reversed the RTC decision. The
CA found sufficient evidence of forgery and did not give credence to
Atty. Plagatas testimony that he saw Rosario sign the document
in Quezon City. Its jurat said differently. Also, upon comparing the
questioned signature with the specimen signatures, the CA noted
significant variance between them. That Tarciano and Rosario had been
living separately for 30 years since 1958 also reinforced the conclusion
that her signature had been forged.
Since Tarciano and Rosario were married in 1950, the CA concluded
that their property relations were governed by the Civil Code under
which an action for annulment of sale on the ground of lack of spousal
consent may be brought by the wife during the marriage within 10
years from the transaction. Consequently, the action that the Rocas,
her heirs, brought in 1997 fell within 10 years of the January 11,
1989 sale.
Considering, however, that the sale between the Fuentes spouses and
Tarciano was merely voidable, the CA held that its annulment entitled
the spouses to reimbursement of what they paid him plus legal
interest computed from the filing of the complaint until actual
payment. Since the Fuentes spouses were also builders in good faith,
they were entitled under Article 448 of the Civil Code to payment of
the value of the improvements they introduced on the lot. The CA did
not award damages in favor of the Rocas and deleted the award of
attorneys fees to the Fuentes spouses.[13]
Unsatisfied with the CA decision, the Fuentes spouses came to this
court by petition for review.[14]
The Issues Presented

The case presents the following issues:

1. Whether or not Rosarios signature on the document of consent
to her husband Tarcianos sale of their conjugal land to the Fuentes
spouses was forged;
2. Whether or not the Rocas action for the declaration of nullity
of that sale to the spouses already prescribed; and
3. Whether or not only Rosario, the wife whose consent was not
had, could bring the action to annul that sale.
The Courts Rulings
First. The key issue in this case is whether or not Rosarios
signature on the document of consent had been forged. For, if the
signature were genuine, the fact that she gave her consent to her
husbands sale of the conjugal land would render the other issues
merely academic.
The CA found that Rosarios signature had been forged. The CA
observed a marked difference between her signature on the affidavit of
consent[15] and her specimen signatures.[16] The CA gave no weight to
Atty. Plagatas testimony that he saw Rosario sign the document in
Manila on September 15, 1988 since this clashed with his declaration
in the jurat that Rosario signed the affidavit in Zamboanga City on
January 11, 1989.
The Court agrees with the CAs observation that Rosarios
signature strokes on the affidavit appears heavy, deliberate, and
forced. Her specimen signatures, on the other hand, are consistently
of a lighter stroke and more fluid. The way the letters R and s were
written is also remarkably different. The variance is obvious even to
the untrained eye.
Significantly, Rosarios specimen signatures were made at about
the time that she signed the supposed affidavit of consent. They were,
therefore, reliable standards for comparison. The Fuentes spouses
presented no evidence that Rosario suffered from any illness or
disease that accounted for the variance in her signature when she
signed the affidavit of consent. Notably, Rosario had been living

separately from Tarciano for 30 years since 1958. And she resided so
far away in Manila. It would have been quite tempting for Tarciano to
just forge her signature and avoid the risk that she would not give her
consent to the sale or demand a stiff price for it.
What is more, Atty. Plagata admittedly falsified the jurat of the
affidavit of consent. That jurat declared that Rosario swore to the
document and signed it in Zamboanga City on January 11, 1989 when,
as Atty. Plagata testified, she supposedly signed it about four months
earlier at her residence in Paco, Manila on September 15, 1988. While
a defective notarization will merely strip the document of its public
character and reduce it to a private instrument, that falsified jurat,
taken together with the marks of forgery in the signature, dooms such
document as proof of Rosarios consent to the sale of the land. That the
Fuentes spouses honestly relied on the notarized affidavit as proof
of Rosarios consent does not matter. The sale is still void without an
authentic consent.
Second. Contrary to the ruling of the Court of Appeals, the law
that applies to this case is the Family Code, not the Civil Code.
Although Tarciano and Rosario got married in 1950, Tarciano sold the
conjugal property to the Fuentes spouses on January 11, 1989, a few
months after the Family Code took effect on August 3, 1988.
When Tarciano married Rosario, the Civil Code put in place the system
of conjugal partnership of gains on their property relations. While its
Article 165 made Tarciano the sole administrator of the conjugal
partnership, Article 166[17] prohibited him from selling commonly
owned real property without his wifes consent. Still, if he sold the
same without his wifes consent, the sale is not void but merely
voidable. Article 173 gave Rosario the right to have the sale annulled
during the marriage within ten years from the date of the sale. Failing
in that, she or her heirs may demand, after dissolution of the
marriage, only the value of the property that Tarciano fraudulently
sold. Thus:
Art. 173. The wife may, during the marriage, and
within ten years from the transaction questioned, ask
the courts for the annulment of any contract of the

husband entered into without her consent, when such

consent is required, or any act or contract of the
husband which tends to defraud her or impair her
interest in the conjugal partnership property. Should
the wife fail to exercise this right, she or her heirs,
after the dissolution of the marriage, may demand
the value of property fraudulently alienated by the
husband.
But, as already stated, the Family Code took effect on August 3,
1988. Its Chapter 4 on Conjugal Partnership of Gains expressly
superseded Title VI, Book I of the Civil Code on Property Relations
Between Husband and Wife.[18] Further, the Family Code provisions
were also made to apply to already existing conjugal partnerships
without prejudice to vested rights.[19] Thus:
Art. 105. x x x The provisions of this Chapter shall
also apply to conjugal partnerships of gains already
established between spouses before the effectivity of
this Code, without prejudice to vested rights already
acquired in accordance with the Civil Code or other
laws, as provided in Article 256. (n)
Consequently, when Tarciano sold the conjugal lot to the Fuentes
spouses on January 11, 1989, the law that governed the disposal of
that lot was already the Family Code.
In contrast to Article 173 of the Civil Code, Article 124 of the
Family Code does not provide a period within which the wife who gave
no consent may assail her husbands sale of the real property. It simply
provides that without the other spouses written consent or a court
order allowing the sale, the same would be void. Article 124 thus
provides:
Art. 124. x x x In the event that one spouse is
incapacitated or otherwise unable to participate in
the administration of the conjugal properties, the
other
spouse
may
assume
sole
powers
of
administration. These powers do not include the

powers of disposition or encumbrance which must

have the authority of the court or the written consent
of the other spouse. In the absence of such authority
or consent, the disposition or encumbrance shall be
void. x x x
Under the provisions of the Civil Code governing contracts, a void
or inexistent contract has no force and effect from the very
beginning. And this rule applies to contracts that are declared void by
positive provision of law,[20] as in the case of a sale of conjugal
property without the other spouses written consent. A void contract is
equivalent to nothing and is absolutely wanting in civil effects. It
cannot be validated either by ratification or prescription. [21]
But, although a void contract has no legal effects even if no
action is taken to set it aside, when any of its terms have been
performed, an action to declare its inexistence is necessary to allow
restitution of what has been given under it. [22] This action, according to
Article 1410 of the Civil Code does not prescribe. Thus:
Art. 1410. The action or defense for the declaration of
the inexistence of a contract does not prescribe.
Here, the Rocas filed an action against the Fuentes spouses in
1997 for annulment of sale and reconveyance of the real property that
Tarciano sold without their mothers (his wifes) written consent. The
passage of time did not erode the right to bring such an action.
Besides, even assuming that it is the Civil Code that applies to
the transaction as the CA held, Article 173 provides that the wife may
bring an action for annulment of sale on the ground of lack of spousal
consent during the marriage within 10 years from the
transaction. Consequently, the action that the Rocas, her heirs,
brought in 1997 fell within 10 years of the January 11, 1989 sale. It
did not yet prescribe.
The Fuentes spouses of course argue that the RTC nullified the
sale to them based on fraud and that, therefore, the applicable
prescriptive period should be that which applies to fraudulent
transactions, namely, four years from its discovery. Since notice of the
sale may be deemed given to the Rocas when it was registered with

the Registry of Deeds in 1989, their right of action already prescribed

in 1993.
But, if there had been a victim of fraud in this case, it would be
the Fuentes spouses in that they appeared to have agreed to buy the
property upon an honest belief that Rosarios written consent to the
sale was genuine. They had four years then from the time they learned
that her signature had been forged within which to file an action to
annul the sale and get back their money plus damages. They never
exercised the right.
If, on the other hand, Rosario had agreed to sign the document
of consent upon a false representation that the property would go to
their children, not to strangers, and it turned out that this was not the
case, then she would have four years from the time she discovered the
fraud within which to file an action to declare the sale void. But that is
not the case here. Rosario was not a victim of fraud or
misrepresentation. Her consent was simply not obtained at all. She
lost nothing since the sale without her written consent was
void. Ultimately, the Rocas ground for annulment is not forgery but the
lack of written consent of their mother to the sale. The forgery is
merely evidence of lack of consent.
Third. The Fuentes spouses point out that it was to Rosario,
whose consent was not obtained, that the law gave the right to bring
an action to declare void her husbands sale of conjugal land. But
here, Rosario died in 1990, the year after the sale.Does this mean that
the right to have the sale declared void is forever lost?
The answer is no. As stated above, that sale was void from the
beginning. Consequently, the land remained the property of Tarciano
and Rosario despite that sale. When the two died, they passed on the
ownership of the property to their heirs, namely, the Rocas. [23] As
lawful owners, the Rocas had the right, under Article 429 of the Civil
Code, to exclude any person from its enjoyment and disposal.
In fairness to the Fuentes spouses, however, they should be
entitled, among other things, to recover from Tarcianos heirs, the
Rocas, the P200,000.00 that they paid him, with legal interest until
fully paid, chargeable against his estate.

Further, the Fuentes spouses appear to have acted in good faith

in entering the land and building improvements on it. Atty. Plagata,
whom the parties mutually entrusted with closing and documenting the
transaction, represented that he got Rosarios signature on the affidavit
of consent. The Fuentes spouses had no reason to believe that the
lawyer had violated his commission and his oath. They had no way of
knowing that Rosario did not come to Zamboanga to give her
consent. There is no evidence that they had a premonition that the
requirement of consent presented some difficulty. Indeed, they
willingly made a 30 percent down payment on the selling price months
earlier on the assurance that it was forthcoming.
Further, the notarized document appears to have comforted the
Fuentes spouses that everything was already in order when Tarciano
executed a deed of absolute sale in their favor on January 11, 1989. In
fact, they paid the balance due him. And, acting on the documents
submitted to it, the Register of Deeds of Zamboanga City issued a new
title in the names of the Fuentes spouses. It was only after all these
had passed that the spouses entered the property and built on it. He is
deemed a possessor in good faith, said Article 526 of the Civil Code,
who is not aware that there exists in his title or mode of acquisition
any flaw which invalidates it.
As possessor in good faith, the Fuentes spouses were under no
obligation to pay for their stay on the property prior to its legal
interruption by a final judgment against them.[24] What is more, they
are entitled under Article 448 to indemnity for the improvements they
introduced into the property with a right of retention until the
reimbursement is made. Thus:
Art. 448. The owner of the land on which anything
has been built, sown or planted in good faith, shall
have the right to appropriate as his own the works,
sowing or planting, after payment of the indemnity
provided for in Articles 546 and 548, or to oblige the
one who built or planted to pay the price of the land,
and the one who sowed, the proper rent. However,
the builder or planter cannot be obliged to buy the
land if its value is considerably more than that of the
building or trees. In such case, he shall pay
reasonable rent, if the owner of the land does not

choose to appropriate the building or trees after

proper indemnity. The parties shall agree upon the
terms of the lease and in case of disagreement, the
court shall fix the terms thereof. (361a)
The Rocas shall of course have the option, pursuant to Article
546 of the Civil Code,[25] of indemnifying the Fuentes spouses for the
costs of the improvements or paying the increase in value which the
property may have acquired by reason of such improvements.
WHEREFORE, the Court DENIES the petition and AFFIRMS WITH
MODIFICATION the decision of the Court of Appeals in CA-G.R. CV
00531 dated February 27, 2007 as follows:
1. The deed of sale dated January 11, 1989 that Tarciano T. Roca
executed in favor of Manuel O. Fuentes, married to Leticia L. Fuentes,
as well as the Transfer Certificate of Title T-90,981 that the Register of
Deeds of Zamboanga City issued in the names of the latter spouses
pursuant to that deed of sale are DECLARED void;
2. The Register of Deeds of Zamboanga City is DIRECTED to
reinstate Transfer Certificate of Title 3533 in the name of Tarciano T.
Roca, married to Rosario Gabriel;
3. Respondents Gonzalo G. Roca, Annabelle R. Joson, Rose Marie
R. Cristobal, and Pilar Malcampo are ORDERED to pay petitioner
spouses Manuel and Leticia Fuentes the P200,000.00 that the latter
paid Tarciano T. Roca, with legal interest from January 11, 1989 until
fully paid, chargeable against his estate;
4. Respondents Gonzalo G. Roca, Annabelle R. Joson, Rose Marie
R. Cristobal, and Pilar Malcampo are further ORDERED, at their
option, to indemnify petitioner spouses Manuel and Leticia Fuentes
with their expenses for introducing useful improvements on the subject
land or pay the increase in value which it may have acquired by reason
of those improvements, with the spouses entitled to the right of
retention of the land until the indemnity is made; and
5. The RTC of Zamboanga City from which this case originated
is DIRECTED to receive evidence and determine the amount of

indemnity to which petitioner spouses Manuel and Leticia Fuentes are

entitled.
SO ORDERED.