Notes:
June 2002.
Under Rule 45, Section 1[3] of the Rules of Court, a petition for review on
certiorari is the remedy that may be resorted to by a party to appeal only a
judgment or final order or resolution of the CA, the Sandiganbayan, the RTC
and other courts whenever authorized by law.
A petition for certiorari under Rule 65 is a pleading limited to correction of
errors of jurisdiction or grave abuse of discretion amounting to lack or
excess of jurisdiction. It may issue only when the following requirements are
alleged in and established by the petition: (1) that the writ is directed against
a tribunal, a board or any officer exercising judicial or quasi-judicial
functions; (2) that such tribunal, board or officer has acted without or in
excess of jurisdiction, or with grave abuse of discretion amounting to lack or
excess of jurisdiction; and (3) that there is no appeal or any plain, speedy
and adequate remedy in the ordinary course of law.
1. ABS-CBN BROADCASTING CORPORATION v. WORLD
INTERACTIVE NETWORK SYSTEMS (WINS) JAPAN CO., LTD.
G.R. No. 169332 February 11, 2008
Batas Pambansa Blg. 129
Facts: This is a petition for review on certiorari under Rule 45 seeking to
set aside the decision of the CA.
Petitioner ABS-CBN Broadcasting Corporation entered into a licensing
agreement with respondent World Interactive Network Systems (WINS),
a foreign corporation licensed under the laws of Japan. Under the agreement,
respondent was granted the exclusive license to distribute and sublicense
the distribution of the television service "The Filipino Channel" in Japan.
By virtue thereof, petitioner undertook to transmit the TFC programming
signals to respondent which the latter received through its decoders and
distributed to its subscribers.
A dispute arose between the parties when petitioner accused respondent of
inserting 9 episodes of WINS WEEKLY, a weekly 35-minute community
news program for Filipinos in Japan, into the TFC programming from
March to May 2002. Petitioner claimed that these were "unauthorized
insertions" constituting a material breach of their agreement. Petitioner
notified respondent of its intention to terminate the agreement effective
Respondent filed an ARBITRATION SUIT pursuant to the arbitration
clause of its agreement with petitioner. It contended that the airing of WINS
WEEKLY was made with petitioner's prior approval. It also alleged that
petitioner only threatened to terminate their agreement because it wanted to
renegotiate the terms thereof to allow it to demand higher fees. Respondent
also prayed for damages for petitioner's alleged grant of an exclusive
distribution license to another entity, NHK (Japan Broadcasting Corporation).
The arbitrator found in favor of respondent. He held that petitioner gave
its approval to respondent for the airing of WINS WEEKLY as shown by a
series of written exchanges between the parties.
Petitioner filed in CA a petition for review under Rule 43 or, in the
alternative, a petition for certiorari under Rule 65, with application for
TRO and writ of preliminary injunction. Respondent, on the other hand, filed
a petition for confirmation of arbitral award before the RTC of Quezon
City.
The CA dismissed ABS-CBNs petition for lack of jurisdiction. It stated
that the terms of reference (TOR) itself provided that the arbitrator's decision
shall be final and unappealable and that no motion for reconsideration shall
be filed. It ruled that it is the RTC WHICH HAS JURISDICTION OVER
QUESTIONS RELATING TO ARBITRATION. It held that the only
instance it can exercise jurisdiction over an arbitral award is an appeal
from the trial court's decision confirming, vacating or modifying the
arbitral award. It further stated that a petition for certiorari under Rule 65 of
the Rules of Court is proper in arbitration cases only if the courts refuse or
neglect to inquire into the facts of an arbitrator's award.
Issue: Whether or not an aggrieved party in a voluntary arbitration
dispute may avail of, directly in the CA, a petition for review under Rule
43 or a petition for certiorari under Rule 65, instead of filing a petition to
vacate the award in the RTC when the GROUNDS INVOKED to overturn
the arbitrators decision ARE OTHER THAN THOSE for a petition to
vacate an arbitral award ENUMERATED UNDER R.A. 876
1
Held: Yes. Based on Section 24 of R.A. 876, the RTC must issue an order
vacating an arbitral award ONLY "IN ANY ONE OF THE CASES"
ENUMERATED THEREIN. As R.A. 876 did not expressly provide for
errors of fact and/or law and grave abuse of discretion (proper grounds
for a petition for review under Rule 43 and a petition for certiorari under
Rule 65, respectively) as grounds for maintaining a petition to vacate an
arbitral award in the RTC, it necessarily follows that a PARTY MAY
NOT AVAIL OF THE LATTER REMEDY ON THE GROUNDS OF
ERRORS OF FACT AND/OR LAW OR GRAVE ABUSE OF
DISCRETION TO OVERTURN AN ARBITRAL AWARD.
IN CASES NOT FALLING UNDER ANY OF THE
AFOREMENTIONED GROUNDS to vacate an award, A PETITION
FOR REVIEW UNDER RULE 43 OR A PETITION FOR
CERTIORARI UNDER RULE 65 MAY BE AVAILED OF IN THE CA.
A voluntary arbitrator is properly classified as a "quasi-judicial
instrumentality" and is, thus, within the ambit of Section 9 (3) of the
Judiciary Reorganization Act. Under this section, the Court of Appeals
shall exercise exclusive appellate jurisdiction over all final judgments,
decisions, resolutions, orders or awards of RTCs and quasi-judicial
agencies, instrumentalities, boards or commissions.
As such, DECISIONS HANDED DOWN BY VOLUNTARY
ARBITRATORS FALL WITHIN THE EXCLUSIVE APPELLATE
JURISDICTION OF THE CA.
Nevertheless, although petitioners position on the judicial remedies
available to it was correct, we sustain the dismissal of its petition by the CA.
The remedy petitioner availed of, entitled "alternative petition for review
under Rule 43 or petition for certiorari under Rule 65," was wrong. The
REMEDIES OF APPEAL AND CERTIORARI ARE MUTUALLY
EXCLUSIVE AND NOT ALTERNATIVE OR SUCCESSIVE.
Proper issues that may be raised in a petition for review under Rule 43
pertain to errors of fact, law or mixed questions of fact and law. While a
petition for certiorari under Rule 65 should only limit itself to errors of
jurisdiction, that is, grave abuse of discretion amounting to a lack or excess
of jurisdiction. Moreover, it cannot be availed of where appeal is the proper
remedy or as a substitute for a lapsed appeal.
The real issues calling for the CA's resolution were less the alleged grave
abuse of discretion exercised by the arbitrator and more about the arbitrators
appreciation of the issues and evidence presented by the parties. Therefore,
the issues clearly fall under the classification of errors of fact and law
questions which may be passed upon by the CA via a petition for review
under Rule 43.
Notes: Section 24 of R.A. 876 provides for the specific grounds for a
petition to vacate an award made by an arbitrator:
Sec. 24. Grounds for vacating award. - In any one of the following
cases, the court must make an order vacating the award upon the petition of
any party to the controversy when such party proves affirmatively that in the
arbitration proceedings:
(a) The award was procured by corruption, fraud, or other undue means;
or
(b) That there was evident partiality or corruption in the arbitrators or
any of them; or
(c) That the arbitrators were guilty of misconduct in refusing to postpone
the hearing upon sufficient cause shown, or in refusing to hear evidence
pertinent and material to the controversy; that one or more of the
arbitrators was disqualified to act as such under section 9 hereof, and
willfully refrained from disclosing such disqualifications or of any other
misbehavior by which the rights of any party have been materially
prejudiced; or
(d) That the arbitrators exceeded their powers, or so imperfectly executed
them, that a mutual, final and definite award upon the subject matter
submitted to them was not made.
2. ALFREDO BOKINGO v. THE HONORABLE COURT OF APPEALS,
the HEIRS OF CELESTINO BUSA, represented by FELICIDAD BUSA-
PANAL and ERNESTO M. CAMPOS
G.R. No. 161739 May 4, 2006
Batas Pambansa Blg. 129
Facts: This is a petition for review on certiorari filed by Bokingo seeking
to reverse the Decision1 of the CA which dismissed his petition for certiorari.
Respondents are co-owners of a parcel of land inherited from their father and
located at Baan (Buhangin), Butuan City. Bokingo and the other defendants
2
in the case filed an application for titling of a parcel of land before the
DENR, Office of the CENRO.
When respondents knew of petitioners application, they filed a protest. The
Provincial Environment and Natural Resources Officer resolved the
protest in favor of respondents.
Respondents requested for a Survey Authority to survey the land before the
CENRO Office. A Survey Authority was issued. Hence, respondents went to
the area. Bokingo and SPO3 Dacillo told the survey group to stop and not
to enter the area.
Respondents availed of the Barangay Justice System to resolve the
controversy but to no avail. Thus, a Certificate to File Action was issued by
the Lupong Tagapamayapa. Hence, respondents filed a complaint for
injunction and damages before the RTC, seeking to enjoin permanently
the illegal acts of petitioner and his companions of preventing the survey
of the land subject matter of this case.
Petitioner filed a MOTION TO DISMISS alleging that the RTC HAS NO
JURISDICTION over the subject matter of the claim. He contended that the
issue involved the possession of the land. As such, the assessed value of the
land was crucial to determine the courts jurisdiction over the subject matter
in accordance with either Section 19(2)6 or Section 33(3)7 of B.P. 129. If the
assessed value thereof is P20,000 or less, then the MTC has jurisdiction
over the subject matter. Otherwise, jurisdiction is with the RTC.
Petitioner pointed out that the assessed value of the land was not indicated.
Nonetheless, based on his fathers tax declaration covering the subject
land, its assessed value was ONLY P14,410. Consequently, jurisdiction
properly belonged to the MTC.
The RTC denied the motion to dismiss. It pointed out that the relief being
sought is INJUNCTION in order that the respondents right to survey
the land would not be defeated. It held that it had jurisdiction under Section
2 of Rule 58 of the Rules of Court which provides in part that "[a]
preliminary injunction may be granted by the court where the action or
proceeding is pending."
Petitioner filed with the CA a petition for certiorari alleging grave abuse
of discretion on the part of the RTC in denying his motion to dismiss.
The CA dismissed the petition for lack of merit. (It ruled that the remedy of
certiorari is unavailing to petitioner because "an order denying a motion
to dismiss is INTERLOCUTORY and cannot be the subject of the
extraordinary petition for certiorari or mandamus." The issue raised by
petitioner, the CA held, was proper for an appeal but not a petition for
certiorari.)
Issue: Whether or not the RTC has jurisdiction over the subject matter
Held: Yes. In determining whether an action is one the subject matter of
which is not capable of pecuniary estimation, the nature of the principal
action, or remedy sought, must first be ascertained. If it is primarily for
the recovery of a sum of money, the claim is considered capable of
pecuniary estimation, and jurisdiction over the action will depend on the
amount of the claim. However, where the basic issue is something other
than the right to recover a sum of money, where the money claim is
purely incidental to, or a consequence of, the principal relief sought, the
action is one where the subject of litigation may not be estimated in terms
of money, which is cognizable exclusively by RTCs.
The respondents complaint has not sought to recover the possession or
ownership of the subject land. Rather, it is principally an action to enjoin
petitioner and his representatives from committing acts that would tend
to prevent the survey of the subject land. It cannot be said therefore that
it is one of a possessory action. As such, the subject matter is
INCAPABLE OF PECUNIARY ESTIMATION and PROPERLY
COGNIZABLE EXCLUSIVELY BY the RTC UNDER SECTION 19 (1)
OF B.P. 129.
(What really distinguishes an action for unlawful detainer from a
possessory action (accion publiciana) and from a reinvindicatory action
(accion reinvindicatoria) is that the first is limited to the question of
possession de facto. An unlawful detainer suit (accion interdictal) together
with forcible entry are the two forms of an ejectment suit that may be
filed to recover possession of real property. Aside from the summary
action of ejectment, accion publiciana or the plenary action to recover the
right of possession and accion reinvindicatoria or the action to recover
ownership which includes recovery of possession, make up the three kinds of
actions to judicially recover possession.
3
 The mere fact that petitioner failed to move for reconsideration of the RTCs
order denying his motion to dismiss was sufficient cause for the outright
dismissal of the said petition. Certiorari as a special civil action will not lie
unless a motion for reconsideration is first filed before the CA to allow it
an opportunity to correct its errors, if any. As further observed by the CA,
petitioner failed to even allege grave abuse of discretion on the part of the
RTC in denying his motion to dismiss.)
3. DAVID LU v. PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR
LU YM, ET. AL. & LUYM DEVELOPMENT CORP.
G.R. No. 153690 August 26, 2008
Batas Pambansa Blg. 129
Facts: LLDC is a family corporation founded by Paterno Sr. and his brothers,
primarily to hold real estate for the family. In 1997, LLDCs Board of
Directors authorized the issuance of its 600,000 unsubscribed and unissued
shares. The Lu Ym father and sons subscribed to and paid most of such
shares. Petitioner and his companions, however, claimed that the stocks
were issued in favor of the Lu Ym father and sons for LESS THAN
THEIR REAL VALUES.
Hence, the complaint filed against the Lu Ym father and sons
for Declaration of Nullity of Share Issue, Receivership and Dissolution
before the RTC. In said complaint, David, et al. asked that the issuance of
said shares be nullified. They further asserted that the Lu Ym father and
sons gravely abused their powers as members of LLDCs Board of
Directors by issuing such shares. They asked for the dissolution of the
corporation as their ultimate remedy to obtain redress for their grievances.
To protect the interest of the corporation during the pendency of the case,
they asked that a receiver for the corporation be appointed.
The Lu Ym father and sons moved to dismiss the complaint for NON-
COMPLIANCE WITH the REQUIRED CERTIFICATE OF NON-
FORUM SHOPPING, since only one of the four plaintiffs signed the
same. They, likewise, contended that the case was dismissible because they
did not exert earnest efforts toward a compromise.
The RTC denied the motion solely on the ground that the case was exempt
from the observance of the Katarungang Pambarangay Law and the
signature of only one of the plaintiffs was a substantial compliance with
the rules on the certificate of non-forum shopping. The court placed LLDC
under receivership pendente lite.
The Lu Ym father and sons elevated the matter to the CA, but the same was
dismissed on the ground that the certification against forum shopping were
signed by only two petitioners.18 They later refiled the case. The CA
initially dismissed the petition, finding no grave abuse of discretion on the
part of the RTC when it denied the Lu Ym father and sons motion to
dismiss and because of the prematurity of the petition on the issue of
receivership (since there was still a motion for reconsideration pending
before the RTC). However, on motion of the Lu Ym father and sons, the CA
reinstated the petition.
The CA granted the Lu Ym father and sons petition and dismissed the
complaint filed by David Lu, et al. for the parties failure to sign the
certificate of non-forum shopping.
The Lu Ym father and sons filed a Manifestation and Motion praying for
the immediate lifting of the receivership order over LLDC. However, the
hearing did not proceed as scheduled due to the repeated motions of David to
stop it. It turned out that David instituted a special civil action for
Certiorari and Prohibition with the CA, with Urgent Application for
TRO and Writ of Preliminary Injunction, on the sole issue of whether or
not the RTC should proceed to hear the Lu Ym father and sons motion to
lift the receivership.
The CA issued a Resolution temporarily restraining the RTC from
conducting any proceeding in the receivership case. The CA finally granted
the petition and ordered the RTC to desist from conducting any
proceeding relating to the receivership over LLDC. The court concluded
that the proceedings on receivership could not proceed without the parties
complying first with the earlier court order which required the parties to
amend their pleadings. The court ratiocinated that it could not rule on the
propriety of the appointment of a receiver because it would have to base its
decision on the pleadings that were yet to be amended.
Aggrieved, the Lu Ym father and sons instituted the instant petition. The Lu
Ym father and sons inquired from the Clerk of Court on the amount of
docket fees paid by David, et al. They further inquired from the OCA as to
the correctness of the amount paid. The OCA informed them that the matter
of docket fees should be brought to the attention of the regular courts and not
to the OCA which was not in the position to give an opinion.
4
The RTC rendered a decision annulling the issuance of LLDCs 600,000
shares of stocks thereby divesting the Lu Ym father and sons of their shares
and canceling their certificates of stocks. The court further ordered the
dissolution of LLDC and the liquidation of its assets.
The Lu Ym father and sons applied for a Writ of Preliminary Injunction
and/or TRO. The CA denied the application for a writ of preliminary
injunction. In their motion for reconsideration, the Lu Ym father and sons
QUESTIONED the SUFFICIENCY OF the DOCKET FEES PAID BY
DAVID, ET AL. in the RTC.
The CA ruled that the matter be raised in their appellants brief and that
the issue be threshed out in the appeal on the merits. Hence, this special
civil action for certiorari and prohibition.
Issue: Whether or not the RTC acquired jurisdiction over the subject
matter despite the failure of petitioner and companions to pay the correct
docket fees
Held: Yes. A court acquires jurisdiction over a case only upon the
payment of the prescribed fees. In the instant case, however, we cannot
grant the dismissal prayed for because of the following reasons: First, the
case instituted before the RTC is one INCAPABLE OF PECUNIARY
ESTIMATION. Hence, the CORRECT DOCKET FEES WERE
PAID. Second, respondents are ESTOPPED from questioning the
jurisdiction of the trial court because of their active participation in the
proceedings below, and because the issue of payment of insufficient
docket fees had been belatedly raised before the CA, i.e., only in their
motion for reconsideration. Lastly, assuming that the docket fees paid were
truly inadequate, the mistake was committed by the Clerk of Court who
assessed the same and not imputable to David; and as to the deficiency, if
any, the same may instead be considered a LIEN on the judgment that
may thereafter be rendered.
The annulment of the shares, the dissolution of the corporation and the
appointment of receivers are ACTIONS WHICH DO NOT CONSIST IN
THE RECOVERY OF A SUM OF MONEY. If, in the end, a sum of
money or real property would be recovered, it would simply be the
consequence of such principal action. Therefore, the case before the RTC
was incapable of pecuniary estimation. And since David paid the docket
fees for an action the subject of which was incapable of pecuniary estimation,
the trial court validly acquired jurisdiction over the case.
Well-established is the rule that after vigorously participating in all stages
of the case before the trial court and even invoking the trial courts
authority in order to ask for affirmative relief, respondents are barred by
estoppel from challenging the trial courts jurisdiction.
4. RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. v. COURT
OF APPEALS and MANUEL DULAWON
G.R. No. 136109 August 1, 2002
Batas Pambansa Blg. 129
Facts: This is a petition for review of the decision of the CA.
Petitioner Radio Communications of the Philippines negotiated with
private respondent Manuel Dulawon the lease of a portion of the latters
building for a period of 3 years. Petitioner removed its equipments and
other personalities from the leased premises and failed to pay rentals due
for the months of January to March 1997.
Private respondent filed with the RTC a complaint for breach of contract
of lease with damages against petitioner. Petitioner filed a motion to
dismiss for LACK OF JURISDICTION contending that it is the MTC
which has jurisdiction as the complaint is basically one for collection of
unpaid rentals in the sum of P84,000, which does not exceed the
jurisdictional amount of P100,000 for RTCs. The RTC denied the motion
to dismiss. Hence, petitioner went to the CA on a petition for certiorari.
The CA dismissed.
Issue: Whether or not the RTC has jurisdiction over the complaint
Held: Yes. In the case at bar, the allegations in the complaint show that
private respondents cause of action is breach of contract.
A breach of contract is a cause of action either for specific performance
or rescission of contracts. ACTIONS FOR SPECIFIC PERFORMANCE
ARE INCAPABLE OF PECUNIARY ESTIMATION and therefore FALL
UNDER the JURISDICTION OF the RTC.
Here, the averments in the complaint reveal that the suit filed by private
respondent was PRIMARILY ONE FOR SPECIFIC PERFORMANCE
as it was aimed to enforce their three-year lease contract which would
5
 INCIDENTALLY ENTITLE HIM TO MONETARY AWARDS if the
court should find that the contract was breached. The prayer, therefore,
for the payment of unpaid rentals plus damages consequent to the breach
is merely incidental to the main action for specific performance.
Clearly, the action for specific performance case, irrespective of the
amount of rentals and damages sought to be recovered, is incapable of
pecuniary estimation, hence cognizable exclusively by the RTC.
(B.P. 129 provides:
SEC. 19. Jurisdiction in civil cases. Regional Trial Courts shall exercise
exclusive original jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of
pecuniary estimation; x x x
(8) In all other cases in which the demand, exclusive of interest, damages of
whatever kind, attorneys fees, litigation expenses, and costs or the value of
the property in controversy exceeds P100,000 (Tabuk, Kalinga in this case so
province) or, in such other cases in Metro Manila, where the demand,
exclusive of the abovementioned items exceeds Two hundred thousand pesos
(P200,000.00).7
Administrative Circular No. 09-94, states: The exclusion of the term
"damages of whatever kind" in determining the jurisdictional amount
under Section 19 (8) and Section 33 (1) of B.P. 129 applies to cases where
the damages are merely incidental to or a consequence of the main cause
of action. However, in cases where the claim for damages is the main cause
of action, or one of the causes of action, the amount of such claim shall be
considered in determining the jurisdiction of the court.)
5. Ruby Shelter v. Hon. Formaran, supra (original)
6. VICTORIANO M. ENCARNACION v. NIEVES AMIGO
G.R. No. 169793 September 15, 2006
Batas Pambansa Blg. 129
Facts: This petition for review assails the Decision of the CA ordering the
remand of the Civil Case to the RTC for further proceedings.
Petitioner Victoriano M. Encarnacion is the registered owner of two lots
located at District 1, National Hi-way, Cauayan, Isabela. Said two lots
originally form part of a single track of land owned by Rogelio Valiente
who sold the same to Mallapitan. Mallapitan sold the land to Victoriano
Magpantay. After the death of the latter, his widow Anita executed an
Affidavit waiving her right over the property in favor of her son-in-law,
herein petitioner. Thereafter, the latter caused the subdivision of the land
into two lots and the issuance of titles in his name.
Respondent Nieves Amigo allegedly entered the premises and took
possession of a portion of the property sometime in 1985 without the
permission of the then owner, Victoriano Magpantay. Said occupation by
respondent continued even after the TCTs were issued to petitioner.
Petitioner demanded that respondent vacate the subject property.
Respondent still refused. Thereafter, petitioner filed a complaint for
ejectment, damages with injunction and prayer for restraining order with
the MTC in Cities of Isabela. In his Answer, respondent alleged that he has
been in actual possession and occupation of a portion of the subject land
since 1968 and that the issuance of Free Patent and titles in the name of
petitioner was tainted with irregularities.
The MTC rendered judgment in favor of petitioner and ordered defendant
to vacate the land and pay rentals.
On appeal, the RTC dismissed the case on the ground that as the MTC had
no jurisdiction over the case, the RTC acquired no appellate jurisdiction
thereof.
Petitioner filed a petition for review under Rule 42 before the CA which
remanded the case to the RTC.
Issue: Whether or not the RTC has jurisdiction over the subject matter
Held: Yes. The material element that determines the proper action to be
filed for the recovery of the possession of the property is the length of
time of dispossession. If the dispossession has NOT lasted for more than
one year, an ejectment proceeding (accion interdictal) is proper and the
INFERIOR COURT acquires jurisdiction. On the other hand, if the
dispossession lasted MORE than one year, the proper action to be filed is
6
an accion publiciana, a plenary action for the recovery of the real right of
possession which should be brought to the proper RTC.
From the allegations in the complaint, it appears that petitioner became the
owner of the subject lot in 1995 and has been since that time deprived
possession of a portion thereof. FROM THE DATE OF THE
PETITIONER'S DISPOSSESSION IN 1995 UP TO HIS FILING OF
HIS COMPLAINT FOR EJECTMENT IN 2001, ALMOST 16 YEARS
HAVE ELAPSED. The length of time that the petitioner was dispossessed
of his property made his cause of action beyond the ambit of an accion
interdictal and effectively made it one for accion publiciana.
However, the RTC should have taken cognizance of the case. Pursuant to
Section 8, Rule 40 of the Rules of Court, if the case is tried on the merits by
the Municipal Court without jurisdiction over the subject matter, the
RTC ON APPEAL MAY NO LONGER DISMISS THE CASE IF IT
HAS ORIGINAL JURISDICTION THEREOF. Moreover, the RTC shall
no longer try the case on the merits, but shall decide the case on the basis of
the evidence presented in the lower court, without prejudice to the
admission of the amended pleadings and additional evidence in the interest of
justice.
(In this jurisdiction, the three kinds of actions for the recovery of
possession of real property are:
1. Accion interdictal, or an ejectment proceeding which may be
either that for forcible entry (detentacion) or unlawful detainer
(desahucio), which is a summary action for recovery of physical
possession where the DISPOSSESSION has NOT LASTED FOR
MORE THAN ONE YEAR, and should be brought in the proper
inferior court;
2. Accion publiciana or the plenary action for the recovery of the
real right of possession, which should be brought in the proper RTC
when the DISPOSSESSION has LASTED MORE THAN ONE
YEAR; and
3. Accion reinvindicatoria or accion de reivindicacion, which is an
action for the recovery of ownership which must be brought in the
proper RTC.
Under the Rules of Court, the remedies of forcible entry and unlawful
detainer are granted to a person deprived of the possession of any land or
building by force, intimidation, threat, strategy, or stealth, or a lessor,
vendor, vendee, or other person against whom the possession of any land or
building is unlawfully withheld after the expiration or termination of the
right to hold possession by virtue of any contract, express or implied, or the
legal representatives or assigns of any such lessor, vendor, vendee, or other
person. These remedies afford the person deprived of the possession to file at
any time within one year after such unlawful deprivation or withholding of
possession, an action in the proper MTC against the person/s unlawfully
withholding or depriving of possession, for the restitution of such possession,
together with damages and costs.)
7. PLANTERS PRODUCTS, INC. v. FERTIPHIL CORPORATION
G.R. No. 166006 March 14, 2008
Batas Pambansa Blg. 129
Facts: This is a petition for review on certiorari of the Decision of the CA
affirming with modification that of the RTC, finding petitioner liable to
private respondent for the levies it paid under LOI No. 1465.
Petitioner Planters Products and private respondent Fertiphil are private
corporations incorporated under Philippine laws. They are both engaged in
the importation and distribution of fertilizers, pesticides and agricultural
chemicals.
Then President Marcos, exercising his legislative powers, issued LOI No.
1465 which provided, among others, for the imposition of a capital
recovery component (CRC) of not less than P10 per bag on the domestic
sale of all grades of fertilizers in the Philippines, until adequate capital is
raised to make PPI viable.
Pursuant to the LOI, Fertiphil paid P10 for every bag of fertilizer it sold
in the domestic market to the Fertilizer and Pesticide Authority (FPA).
FPA then remitted the amount to the Far East Bank and Trust Company,
the depositary bank of PPI.
7
After the 1986 Edsa Revolution, FPA voluntarily stopped the imposition
of the levy. Fertiphil demanded from PPI a refund of the amounts it paid
under LOI No. 1465 (amounting to P6,698,144), but PPI refused.
Fertiphil filed a complaint for collection and damages against FPA and
PPI with the RTC. It QUESTIONED the CONSTITUTIONALITY OF
LOI NO. 1465 for being unjust, unreasonable, oppressive, invalid and an
unlawful imposition that amounted to a denial of due process of
law. Fertiphil alleged that the LOI solely favored PPI, a privately owned
corporation, which used the proceeds to maintain its monopoly of the
fertilizer industry.
In its Answer, FPA countered that the issuance of LOI No. 1465 was a valid
exercise of the police power of the State in ensuring the stability of the
fertilizer industry in the country.
The RTC rendered judgment in favor of Fertiphil, ordering PPI to refund
the amounts paid by Fertiphil. The RTC invalidated the levy for violating
the basic principle that taxes can only be levied for a public purpose and
not to benefit, aid and promote a private enterprise such as PPI.
On appeal, the CA affirmed the decision of the RTC, subject to the
modification that the award of attorneys fees is deleted. (The CA ruled
that the lis mota of the complaint for collection was the constitutionality of
LOI No. 1465.)
PPI moved for reconsideration but its motion was denied. It then filed the
present petition for review on certiorari with this Court.
Issue: Whether or not the RTCs have jurisdiction to rule upon the
constitutionality of LOI No. 1465
Held: Yes. The RTCs have jurisdiction to resolve the constitutionality of
statutes, executive orders, presidential decrees and other issuances. The
Constitution vests the power of judicial review or the power to declare a
law, treaty, international or executive agreement, presidential decree,
order, instruction, ordinance, or regulation unconstitutional not only in
the Supreme Court but in all RTCs. This is clear from Section 5, Article 8
of the 1987 Constitution.
The P10 levy is unconstitutional because it was not for a public purpose.
The levy was imposed to give undue benefit to PPI. Taxes are exacted only
for a public purpose. They cannot be used for purely private purposes or for
the exclusive benefit of private persons.
(Our courts have laid down the test to determine the validity of a police
measure as follows: (1) the interests of the public generally, as
distinguished from those of a particular class, requires its exercise; and
(2) the means employed are reasonably necessary for the accomplishment
of the purpose and not unduly oppressive upon individuals. Ensuring the
continued supply and distribution of fertilizer in the country is an
undertaking imbued with public interest. However, the method by which
LOI 1465 sought to achieve this is by no means a measure that will
promote the public welfare. The governments commitment to support
the successful rehabilitation and continued viability of PPI, a private
corporation, is an unmistakable attempt to mask the subject statutes
impartiality. There is no way to treat the self-interest of a favored entity, like
PPI, as identical with the general interest of the countrys farmers or even the
Filipino people in general.)
8. OSCAR R. BADILLO, GIOVANNI C. ONG, EDGAR A. RAGASA
represented by heirs CYNTHIA G. RAGASA, and their children JOSEPH,
CATHERINE and CHARMAINE all surnamed RAGASA, ROLANDO
SANCADA, and DIONISIO UMBALIN v. COURT OF APPEALS,
REGISTER OF DEEDS OF QUEZON CITY, GOLDKEY DEVELOPMENT
CORPORATION, JOSEFA CONEJERO, IGNACIO D. SONORON, PEDRO
DEL ROSARIO, and DOWAL REALTY AND MANAGEMENT SYSTEM
COMPANY
G.R. No. 131903 June 26, 2008
Batas Pambansa Blg. 129
Facts: This petition for certiorari assails the Decision of the CA dismissing
the appeal filed by petitioners questioning the Order of the RTC. in Civil
Case No. Q-91-10510 for Annulment of Documents with Prayer for Issuance
of Prohibitory and Mandatory Injunction and Damages.
Petitioners are the registered owners of several lots adjoining a road lot
known as Apollo Street. The road lot is a short access road which connects
petitioners properties to the main road known as Road 20. The road lot is
covered by a TCT registered in the name of respondent Pedro del Rosario.
Annotated at the back of the TCT is a court-ordered Entry which mandates
8
that the street lot shall not be closed or disposed of by the registered
owner without previous approval of the court.
In gross violation of the court order, del Rosario sold an unsegregated
portion of the road lot to his co-respondents without obtaining prior
court approval. Respondents then entered into a partition agreement to
divide the road lot into 4 lots which resulted in the partial cancellation of
the TCT and the subsequent issuance of 4 new TCTs in the name of
respondents.
Del Rosario sold the TCT registered in his name to Goldkey
Development Corporation. Goldkey built cement fences on the lot, thus
blocking the ingress and egress of petitioners.
Petitioners filed an initial complaint with the Office of the Building
Official of Quezon City, claiming that the parcel of land was a ROAD
LOT.
The Housing and Land Use Regulatory Board issued a Development
Permit to Goldkey allowing it to develop the land into residential
townhouse units. The permit also mentioned that the project is classified as
Residential Townhouse Subdivision.
Petitioners filed a case for Annulment of Title and Damages with the
RTC, praying that the sales made in favor of respondents and the
partition of the road lot be declared void. In its Comment, Goldkey
alleged that the Housing and Land Use Regulatory Board has exclusive
jurisdiction over the cases mentioned in Section 1 of P.D. No. 1344.
Subsequently, the building official resolved the building case against
petitioners, ruling that the property is not a road lot but a
RESIDENTIAL LOT.
The RTC issued an order dismissing the case for LACK OF
JURISDICTION. The trial court stated that petitioners contention that the
property is a road lot had been rendered moot by the finding of the building
official which made the contrary declaration. If petitioners had any objection
to the ruling, they should have appealed the same to the Secretary of Public
Works and Highways. The findings of administrative agencies which have
expertise are generally accorded not only respect but even finality.
The trial court also stated that the property had been approved by the
Housing and Land Use Regulatory Board for development into a
townhouse project. The subject land was therefore removed from the
jurisdiction of the regular courts.
The CA dismissed the appeal on the ground that it has no jurisdiction to
entertain the same. Petitioners complaints were filed for the purpose of
enforcing a contractual and statutory obligation of del Rosario to preserve a
subdivision road lot for street purposes. As such, the agency with
jurisdiction is the Housing and Land Use Regulatory Board. Hence, this
petition.
Issue: Whether or not jurisdiction lies with the Housing and Land Use
Regulatory Board and not with the regular courts
Held: Yes. The HOUSING AND LAND USE REGULATORY BOARD is
the SOLE REGULATORY BODY FOR HOUSING AND LAND
DEVELOPMENT. Courts will NOT determine a controversy where the
issues for resolution demand the exercise of sound administrative
discretion.
In the present case, petitioners are enforcing their statutory and
contractual rights against the subdivision owners. This is a specific
performance case which falls under the Housing and Land Use
Regulatory Boards exclusive jurisdiction.
The provisions of P.D. No. 957 were intended to encompass all questions
relating to subdivisions. This intention was aimed to provide for an
appropriate government agency, which is the Housing and Land Use
Regulatory Board, to which all parties aggrieved in the implementation of
provisions and the enforcement of contractual rights with respect to said
category of real estate may take recourse.
Petitioners contend that the Housing and Land Use Regulatory Board,
having only the jurisdiction to hear and decide specific performance
cases, can only compel petitioners to file a case for annulment of title and
prosecute the action. Petitioners insist that a case for annulment of title
would still have to be filed with the ordinary courts.
When an administrative agency is conferred quasi-judicial functions, all
controversies relating to the subject matter pertaining to its
9
 specialization are DEEMED TO BE INCLUDED WITHIN ITS
JURISDICTION. This quasi-judicial function, as it is called, is exercised by
them as an incident of the principal power entrusted to them of regulating
certain activities falling under their particular expertise.
9. OSCAR C. REYES v. HON. REGIONAL TRIAL COURT OF MAKATI,
Branch 142, ZENITH INSURANCE CORPORATION, and RODRIGO C.
REYES
G.R. No. 165744 August 11, 2008
Batas Pambansa Blg. 129
Facts: This Petition for Review on Certiorari under Rule 45 seeks to set
aside the Decision of the CA affirming the Order of the RTC in Civil Case
"Accounting of All Corporate Funds and Assets, and Damages" which denied
petitioners Motion to Declare Complaint as Nuisance or Harassment Suit.
Petitioner Oscar and private respondent Rodrigo Reyes are two of the four
children of the spouses Pedro and Anastacia Reyes. Pedro, Anastacia,
Oscar, and Rodrigo each owned shares of stock of Zenith Insurance
Corporation, a domestic corporation established by their family. Pedro died
in 1964, while Anastacia died in 1993. Although Pedros estate was
judicially partitioned among his heirs, no similar settlement and partition
appear to have been made with Anastacias estate, which included her
shareholdings in Zenith. Anastacia owned 136,598 shares of Zenith; Oscar
owned 8,715,637 and Rodrigo owned 4,250 shares.
Zenith and Rodrigo filed a complaint with the SEC against Oscar. The
complaint stated that it is "a derivative suit initiated and filed to OBTAIN
an ACCOUNTING of the funds and assets of Zenith which are now or
formerly in the control, custody, and/or possession of petitioner and to
DETERMINE the SHARES OF STOCK of deceased spouses Pedro and
Anastacia Reyes that were arbitrarily and fraudulently appropriated by
Oscar for himself and which were not collated and taken into account in
the partition, distribution, and/or settlement of the estate of the deceased
spouses, for which he should be ordered to account for all the income from
the time he took these shares of stock, and should now deliver to his brothers
and sisters their just and respective shares."
In his Answer with Counterclaim, Oscar asserted that he purchased the
subject shares with his own funds from the unissued stocks of Zenith, and
that the suit is not a bona fide derivative suit because the requisites therefor
have not been complied with. He thus questioned the SECs jurisdiction to
entertain the complaint because it pertains to the settlement of the estate
of Anastacia Reyes.
When R.A. 8799 took effect, the SECs exclusive and original jurisdiction
over cases enumerated in Section 5 of P.D. 902-A was transferred to the
RTC designated as a special commercial court. The records of Rodrigos
SEC case were thus turned over to the RTC, Branch 142, Makati, and
docketed as Civil Case No. 00-1553.
Oscar filed a Motion to Declare Complaint as Nuisance or Harassment
Suit. The RTC denied the motion in part and declared that ONLY the
DERIVATIVE SUIT FOR ACCOUNTING OF the FUNDS and assets OF
the CORPORATION which are in the control, custody, and/or possession of
petitioner WILL BE TAKEN COGNIZANCE OF, as the action for
determination of the shares of stock of deceased spouses is NOT A
DERIVATIVE SUIT and should properly be threshed out in a
PETITION FOR SETTLEMENT OF ESTATE.
Oscar went to the CA on a petition for certiorari, prohibition,
and mandamus. The CA affirmed the RTC Order. Petitioner now comes
before us on appeal through a petition for review on certiorari under Rule
45.
Issue: Whether or not the trial court, sitting as a special commercial court,
has jurisdiction over the subject matter of Rodrigos complaint
Held: No. The nature of the present controversy is not one which may be
classified as an intra-corporate dispute and is beyond the jurisdiction of
the special commercial court to resolve.
P.D. No. 902-A enumerates the cases over which the SEC (now the RTC
acting as a special commercial court) exercises exclusive jurisdiction:
SECTION 5. In addition to the regulatory and adjudicative functions
of the Securities and Exchange Commission over corporations,
partnership, and other forms of associations registered with it as
expressly granted under existing laws and decrees, it shall have
original and exclusive jurisdiction to hear and decide cases
involving:
10
 a) Devices or schemes employed by or any acts of the
board of directors, business associates, its officers or
partners, amounting to fraud and misrepresentation
which may be detrimental to the interest of the public and/or
of the stockholders, partners, members of associations or
organizations registered with the Commission.
b) Controversies arising out of intra-corporate or
partnership relations, between and among stockholders,
members, or associates; between any or all of them and the
corporation, partnership or association of which they are
stockholders, members, or associates, respectively; and
between such corporation, partnership or association and the
State insofar as it concerns their individual franchise or right
to exist as such entity; and
c) Controversies in the election or appointment of directors,
trustees, officers, or managers of such corporations,
partnerships, or associations.
The allegations set forth in Rodrigos complaint principally invoke Section 5,
paragraphs (a) and (b) as basis for the exercise of the RTCs special court
jurisdiction.
Fraudulent Devices and Schemes
The rule is that a complaint must contain a plain, concise, and direct
statement of the ultimate facts constituting the plaintiffs cause of action and
must specify the relief sought.13 Section 5, Rule 8 of the Revised Rules of
Court provides that in all averments of fraud or mistake, the
circumstances constituting fraud or mistake must be stated with
PARTICULARITY. These rules find specific application to Section 5(a) of
P.D. No. 902-A which speaks of corporate devices or schemes that amount to
fraud or misrepresentation detrimental to the public and/or to the
stockholders.
Allegations of deceit, machination, false pretenses, misrepresentation,
and threats are largely conclusions of law that, WITHOUT
SUPPORTING STATEMENTS OF the FACTS to which the allegations
of fraud refer, DO NOT SUFFICIENTLY STATE AN EFFECTIVE
CAUSE OF ACTION.
Tested against these standards, we find that the CHARGES OF FRAUD
AGAINST OSCAR WERE NOT PROPERLY SUPPORTED BY THE
REQUIRED FACTUAL ALLEGATIONS. While the complaint
contained allegations of fraud purportedly committed by him, THESE
ALLEGATIONS ARE NOT PARTICULAR ENOUGH TO BRING THE
CONTROVERSY WITHIN THE SPECIAL COMMERCIAL COURTS
JURISDICTION; they are not statements of ultimate facts, but are mere
conclusions of law: how and why the alleged appropriation of shares can
be characterized as "illegal and fraudulent" were not explained nor
elaborated on.
Intra-Corporate Controversy
The main consideration in determining whether a dispute constitutes an intra-
corporate controversy was limited to a consideration of the intra-corporate
relationship existing between or among the parties. 19 The types of
relationships embraced under Section 5(b) are as follows:
a) between the corporation, partnership, or association and the
public;
b) between the corporation, partnership, or association and its
stockholders, partners, members, or officers;
c) between the corporation, partnership, or association and the State
as far as its franchise, permit or license to operate is concerned; and
d) among the stockholders, partners, or associates themselves.
The existence of any of the above intra-corporate relations was sufficient to
confer jurisdiction to the SEC, regardless of the subject matter of the dispute.
This came to be known as the relationship test.
However, in the 1984 case of DMRC Enterprises v. Esta del Sol Mountain
Reserve, Inc.,21 the Court introduced the nature of the controversy test. We
declared in this case that it is not the mere existence of an intra-corporate
relationship that gives rise to an intra-corporate controversy; to rely on
the relationship test alone will divest the regular courts of their jurisdiction
for the sole reason that the dispute involves a corporation, its directors,
officers, or stockholders.
Under the nature of the controversy test, the INCIDENTS of that
relationship must also be considered for the purpose of ascertaining
whether the controversy itself is intra-corporate. The controversy must
not only be rooted in the existence of an intra-corporate relationship, but
11
must as well pertain to the ENFORCEMENT OF THE PARTIES
CORRELATIVE RIGHTS AND OBLIGATIONS UNDER THE
CORPORATION CODE AND THE INTERNAL AND INTRA-
CORPORATE REGULATORY RULES OF THE CORPORATION. If
the relationship and its incidents are merely incidental to the controversy or if
there will still be conflict even if the relationship does not exist, then no
intra-corporate controversy exists.
The Court then combined the two tests and declared that jurisdiction should
be determined by considering not only the status or relationship of the
parties, but also the nature of the question under controversy. This two-
tier test was adopted in the recent case of Speed Distribution, Inc. v. Court of
Appeals:24
To determine whether a case involves an intra-corporate controversy,
and is to be heard and decided by the branches of the RTC
specifically designated by the Court to try and decide such cases, two
elements must concur: (a) the status or relationship of the parties;
and (2) the nature of the question that is the subject of their
controversy.
The first element requires that the controversy must arise out of
intra-corporate or partnership relations between any or all of the
parties and the corporation, partnership, or association of which they
are stockholders, members or associates; between any or all of them
and the corporation, partnership, or association of which they are
stockholders, members, or associates, respectively; and between such
corporation, partnership, or association and the State insofar as it
concerns their individual franchises. The second element requires
that the dispute among the parties be intrinsically connected with
the regulation of the corporation. If the nature of the controversy
involves matters that are purely civil in character, necessarily, the
case does not involve an intra-corporate controversy.
Simply stated, the transfer of title by means of succession, though effective
and valid between the parties involved (i.e., between the decedents estate
and her heirs), does not bind the corporation and third parties. The transfer
must be registered in the books of the corporation to make the transferee-heir
a stockholder entitled to recognition as such both by the corporation and by
third parties.26
We note, in relation with the above statement, that in Abejo v. Dela
Cruz27 and TCL Sales Corporation v. Court of Appeals28 we did not require
the registration of the transfer before considering the transferee a stockholder
of the corporation (in effect upholding the existence of an intra-corporate
relation between the parties and bringing the case within the jurisdiction of
the SEC as an intra-corporate controversy). A marked difference, however,
exists between these cases and the present one.
In Abejo and TCL Sales, the transferees held definite and uncontested titles
to a specific number of shares of the corporation; after the transferee had
established prima facie ownership over the shares of stocks in question,
registration became a mere formality in confirming their status as
stockholders. In the present case, each of Anastacias heirs holds only an
undivided interest in the shares. This interest, at this point, is still inchoate
and subject to the outcome of a settlement proceeding; the right of the heirs
to specific, distributive shares of inheritance will not be determined until all
the debts of the estate of the decedent are paid. In short, the heirs are only
entitled to what remains after payment of the decedents debts; 29 whether
there will be residue remains to be seen. Justice Jurado aptly puts it as
follows:
No succession shall be declared unless and until a liquidation of the
assets and debts left by the decedent shall have been made and all his
creditors are fully paid. Until a final liquidation is made and all the
debts are paid, the right of the heirs to inherit remains inchoate. This
is so because under our rules of procedure, liquidation is necessary
in order to determine whether or not the decedent has left any
liquid assets which may be transmitted to his heirs.30 [Emphasis
supplied.]
Rodrigo must, therefore, hurdle two obstacles before he can be considered a
stockholder of Zenith with respect to the shareholdings originally belonging
to Anastacia. First, he must prove that there are shareholdings that will be
left to him and his co-heirs, and this can be determined only in a
settlement of the decedents estate. No such proceeding has been
commenced to date. Second, he must register the transfer of the shares
allotted to him to make it binding against the corporation. Without the
settlement of Anastacias estate, there can be no definite partition and
distribution of the estate to the heirs. Without the partition and distribution,
there can be no registration of the transfer. And without the registration, we
cannot consider the transferee-heir a stockholder who may invoke the
12
 existence of an intra-corporate relationship as premise for an intra-corporate
controversy within the jurisdiction of a special commercial court.
In sum, we find that insofar as the subject shares of stock (i.e., Anastacias
shares) are concerned Rodrigo cannot be considered a stockholder of
Zenith. Consequently, we cannot declare that an intra-corporate relationship
exists that would serve as basis to bring this case within the special
commercial courts jurisdiction under Section 5(b) of PD 902-A, as amended.
Rodrigos complaint, therefore, fails the relationship test.
Application of the Nature of Controversy Test
Our examination of the complaint yields the conclusion that, more than
anything else, the complaint is about the protection and enforcement of
successional rights. The controversy it presents is PURELY CIVIL
RATHER THAN CORPORATE, although it is denominated as a
"complaint for accounting of all corporate funds and assets."
The present controversy arose from the parties relationship as heirs of
Anastacia and not as shareholders of Zenith. Rodrigo, in filing the
complaint, is enforcing his rights as a co-heir and not as a stockholder of
Zenith. The injury he seeks to remedy is one suffered by an heir (for the
impairment of his successional rights) and not by the corporation nor by
Rodrigo as a shareholder on record.
The RTC OF MAKATI, ACTING AS A SPECIAL COMMERCIAL
COURT, HAS NO JURISDICTION TO SETTLE, PARTITION, AND
DISTRIBUTE THE ESTATE OF A DECEASED.
Matters which involve settlement and distribution of the estate of the
decedent fall within the exclusive province of the probate court in the
exercise of its limited jurisdiction.
10. EULALIA RUSSELL, PUPERTO TAUTHO, FRANCISCO TAUTHO,
SUSANA T. REALES, APITACIO TAUTHO, DANILO TAUTHO,
JUDITHA PROS, GREGORIO TAUTHO, DEODITA T. JUDILLA,
AGRIPINO TAUTHO, FELIX TAUTHO, WILLIAM TAUTHO, AND
MARILYN PERALES v. HONORABLE AUGUSTINE A. VESTlL,
ADRIANO TAGALOG, MARCELO TAUTHO, JUANITA MENDOZA,
DOMINGO BANTILAN, RAUL BATALUNA AND ARTEMIO
CABATINGAN
G.R. No. 119347 March 17, 1999
Batas Pambansa Blg. 129
Facts: This is a Petition for Certiorari to set aside the Order issued by
respondent RTC Judge Vestil, dismissing the complaint filed by petitioners
on ground of lack of jurisdiction.
Petitioners filed a complaint against private respondents, denominated
"DECLARATION OF NULLITY AND PARTITION," with the RTC. The
complaint alleged that petitioners are co-owners of a parcel of land
previously owned by the spouses Casimero Tautho and Cesaria Tautho.
Upon the death of said spouses, the property was inherited by their legal
heirs, herein petitioners and private respondents.
Since then, the lot had remained undivided until petitioners discovered a
public document denominated "DECLARATION OF HEIRS and DEED
OF CONFIRMATION OF A PREVIOUS ORAL AGREEMENT OF
PARTITION." By virtue of this deed, PRIVATE RESPONDENTS
DIVIDED THE PROPERTY AMONG THEMSELVES TO THE
EXCLUSION OF PETITIONERS who are also entitled to the said lot as
heirs of the late spouse. The complaint prayed that the document be
declared null and void and an order be issued to partition the land among
all the heirs.
Private respondents filed a Motion to Dismiss on the ground of lack of
jurisdiction over the nature of the case as the action is one for RE-
PARTITION the total assessed value of the subject land is P5,000 which
under section 33 (3) 3 of B.P. 129 falls within the exclusive jurisdiction of
the MCTC.
Petitioners filed an Opposition to the Motion to Dismiss saying that the
RTC has jurisdiction since the action is one for the ANNULMENT OF A
DOCUMENT which is incapable of pecuniary estimation within the
contemplation of Section 19(1) of B.P. 129.
The respondent judge issued an Order granting the Motion to Dismiss.
Hence, this petition.
Issue: Whether or not the RTC has jurisdiction to entertain the civil case
13
 Held: Yes. The main purpose of petitioners in filing the complaint is TO
DECLARE NULL AND VOID the document in which private
respondents declared themselves as the only heirs of the late spouses and
divided his property among themselves to the exclusion of petitioners
who also claim to be legal heirs and entitled to the property.
While the complaint also prays for the partition of the property, this is
JUST INCIDENTAL TO THE MAIN ACTION.
11. FERNANDA GEONZON VDA. DE BARRERA AND JOHNNY OCO,
JR. v. HEIRS OF VICENTE LEGASPI, REPRESENTED BY PEDRO
LEGASPI
G.R. No. 174346 September 12, 2008
Batas Pambansa Blg. 129
Under review before this Court is the July 31, 2006 Decision of the Court of
Appeals,[1] which affirmed that of the Regional Trial Court, Branch 16,
of Tangub City in Civil Case No. TC-97-001, ordering the defendants-
petitioners herein, Fernanda Geonzon vda. de Barrera and Johnny Oco. Jr. to
return possession of the subject property to the plaintiffs-herein respondents,
Heirs of Vicente Legaspi.
On October 1, 1996, petitioner Johnny Oco Jr. (Oco), said to be a peace
officer connected with the PNP, accompanied by unidentified CAFGU
members, forced his way into respondents 0.9504-hectare irrigated farmland
located at Liloan, Bonifacio, Misamis Occidental. After dispossessing
respondents of the property, Oco and company used a tractor to destroy the
planted crops, took possession of the land, and had since tended it. [2]
Respondents thus filed on February 7, 1997 a complaint before
the Regional Trial Court of Tangub City for Reconveyance of Possession
with Preliminary Mandatory Injunction and Damages[3] against petitioners.
In their Answer, petitioners claimed that the subject land forms part of a
three-hectare property described in OCT No. P-447 issued on February 10,
1956 in the name of Andrea Lacson who sold a 2-hectare portion thereof to
Eleuterio Geonzon who, in turn, sold 1.1148 thereof to his sister petitioner
Fernanda Geonzon vda. de Barrera (Fernanda). [4]
Respondents, on the other hand, asserted that the land was occupied,
possessed and cultivated by their predecessor-in-interest Vicente Legaspi and
his wife Lorenza since 1935;[5] after a subdivision survey was conducted in
November 30, 1976, it was found out that the land formed part of the titled
property of Andrea Lacson;[6] and despite this discovery, they never filed any
action to recover ownership thereof since they were left undisturbed in their
possession,[7] until October 1, 1996 when petitioners forced their way into it.
Petitioners raised the issue of ownership as a special affirmative defense. [8] In
their Memorandum, however, they questioned the jurisdiction of the RTC
over the subject matter of the complaint, the assessed value of the land being
only P11,160,[9] as reflected in Tax Declaration No. 7565.[10]
By Decision of November 27, 1998, the trial court found for respondents,
disposing as follows:
WHEREFORE, judgment is hereby rendered in favor of the
plaintiffs [herein respondents] and against the defendants [-
herein petitioners]:
1. Ordering the latter to return the possession of the land in
question to the plaintiffs and
2. Ordering the latter to desist from further depriving and
disturbing plaintiffs peaceful possession thereof, unless there
be another court judgment to the contrary.
14
 SO ORDERED.
On the issue of jurisdiction over the subject matter, the trial court,
maintaining that it had, held:
The Court is not persuaded by [the defendants]
arguments. What determines the nature of the action as well
as the jurisdiction of the [c]ourt are the facts alleged in the
complaint and not those alleged in the answer of the
defendants.
xxxx
In [p]ar. 2 of plaintiffs complaint, the land in question was
described as a riceland situated at Liloan, Bonifacio,
Misamis Occ. and declared under [T]ax [D]eclaration No.
7564 in the name of Vicente Legaspi and bounded on the
north by a creek, on the east Sec. 12, on the south Lot No.
007 and on the west also by Lot No. 007 which tax
declaration cancels former [T]ax [D]eclaration No. 12933
under the name of Lorenza Bacul Legaspi which likewise
cancels [T]ax [D]eclaration No. 5454 covering the bigger
portion of the land under which the land described under
[T]ax [D]eclaration No. 7565 is part and parcel thereof
[sic]; the present estimated value being P50,000.
[11]
(Emphasis and underscoring supplied)
Petitioners thereupon appealed to the Court of Appeals which affirmed the
trial courts disposition of the issue of jurisdiction over the subject matter.
On the merits, the appellate court affirmed too the trial courts decision,
finding that both testimonial and documentary evidence on record established
that appellees, through their predecessors-in-interest, have been in peaceful,
continuous, public and actual possession of the property in dispute even
before the year 1930.[12]
The appellate court emphasized that in an accion publiciana, the only issue
involved is the determination of possession de jure.[13]
Hence, the present petition for review which raises the following issues:
I. . . . WHETHER OWNERSHIP AND TITLE CANNOT BE
AN ISSUE TO DETERMINE WHO HAS A BETTER
RIGHT [TO] THE PORTION LITIGATED; AND
II. WHETHER . . . THE NATURE OF THE ACTION AS
WELL AS THE JURISDICTION OF THE COURT
DEPEND ON THE FACTS AS ALLEGED IN THE
COMPLAINT.[14]
For obvious reasons, the issue of lack of jurisdiction over the subject matter
shall be first considered.
Section 33 of Batas Pambansa Bilang 129, (the Judiciary Reorganization Act
of 1980), as amended by Republic Act No. 7691 provides for the jurisdiction
of metropolitan trial courts, municipal trial courts and municipal circuit trial
courts, to wit:
xxxx
(3) Exclusive original jurisdiction in all civil actions
which involve title to, or possession of, real property, or
any interest therein where the assessed value of the
property or interest therein does not exceed Twenty
thousand pesos (P20,000.00) or, in civil actions in Metro
Manila, where such assessed value does not exceed Fifty
thousand pesos (P50,000.00) exclusive of interest, damages
of whatever kind, attorneys fees, litigation expenses and
costs: Provided, That in cases of land not declared for
taxation purposes, the value of such property shall be
determined by the assessed value of the adjacent
lots. (Emphasis, italics and underscoring supplied)
Before the amendments introduced by Republic Act No. 7691, the plenary
action of accion publiciana was to be brought before the regional trial court.
[15]
With the modifications introduced by R.A. No. 7691 in 1994, the
jurisdiction of the first level courts has been expanded to include jurisdiction
over other real actions where the assessed value does not
exceed P20,000, P50,000 where the action is filed in Metro Manila. The first
level courts thus have exclusive original jurisdiction over accion
publiciana andaccion reivindicatoria where the assessed value of the real
property does not exceed the aforestated amounts. Accordingly, the
jurisdictional element is the assessed value of the property.
15

Assessed value is understood to be the worth or value of property established
by taxing authorities on the basis of which the tax rate is applied. Commonly,
however, it does not represent the true or market value of the property.[16]
The subject land has an assessed value of P11,160 as reflected in Tax
Declaration No. 7565, a common exhibit of the parties. The bare claim of
respondents that it has a value of P50,000 thus fails. The case, therefore, falls
within the exclusive original jurisdiction of the municipal trial court.
It was error then for the RTC to take cognizance of the complaint based on
the allegation that the present estimated value [of the land is] P50,000, which
allegation is, oddly, handwritten on the printed pleading. The estimated
value, commonly referred to as fair market value, [17] is entirely different from
the assessed value of the property.
Lack of jurisdiction is one of those excepted grounds where the court may
dismiss a claim or a case at any time when it appears from the pleadings or
the evidence on record that any of those grounds exists, even if they were not
raised in the answer or in a motion to dismiss.[18] That the issue of lack of
jurisdiction was raised by petitioners only in their Memorandum filed before
the trial court did not thus render them in estoppel.
En passant, the Court notes that respondents cause of action accion
publiciana is a wrong mode. The dispossession took place on October 1,
1996 and the complaint was filed four months thereafter or on February 7,
1997. Respondents exclusion from the property had thus not lasted for more
than one year to call for the remedy of accion publiciana.
In fine, since the RTC has no jurisdiction over the complaint filed by
respondents, all the proceedings therein as well as the Decision of November
27, 1998, are null and void. The complaint should perforce be
dismissed. This leaves it unnecessary to still dwell on the first issue.
WHEREFORE, the petition is hereby GRANTED. The challenged July 31,
2006 Decision of the Court of Appeals is SET ASIDE. The decision of
Branch 16 of theRegional Trial Court of Tangub City in Civil Case No. TC-
97-001 is declared NULL and VOID for lack of jurisdiction.
Footnotes
[17] Fair market value is the price at which a property may be sold by a seller
who is not compelled to sell and bought by a buyer who is not compelled to
buy (Section 199, R.A. 7160 or the LOCAL GOVERNMENT CODE).
12. JOVENAL OUANO v. GTT INTERNATIONAL INVESTMENT
CORPORATION and HON. JUDGE RAMON G. CODILLA, JR.
G.R. No. 134230 July 17, 2002
Batas Pambansa Blg. 129
PGTT International Investment Corporation (PGTT), respondent, is a
corporation duly organized under existing laws, with address at YASCO
Bldg., M. J. Cuenco Ave., Cebu City.
On December 11, 1997, PGTT filed with the Regional Trial Court (RTC),
Branch 20, Cebu City, a verified complaint against Jovenal Ouano, petitioner,
docketed as Civil Case No. CEB- 21319, entitled "PGTT INTERNATIONAL
INVESTMENT CORPORATION, Plaintiff, vs. JUVENAL OUANO,
Defendant," for "Recovery of Ownership and Possession of Real Property
and Damages."1 In its complaint, PGTT alleged that it is the owner of Lot
Nos. 1-10, Block 2 of the Sunnymeade Crescent Subdivision located at Pit-
os, Talamban, Cebu City. Sometime in October of 1996, PGTT found that
Ouano uprooted the concrete monuments of the said lots, plowed them and
planted corn thereon. Despite PGTTs demand that he vacate the lots and
restore them to their original condition, Ouano refused, claiming he is the
owner and lawful possessor of the 380 square meters he occupied. Due to
Ouanos wrongful act, PGTT was deprived of the use of its property and
suffered damages in the amount of P100,000.00 a year. Likewise, PGTT was
constrained to file the subject action and hired the services of his counsel
for P100,000.00. PGTT prayed:
"WHEREFORE, in view of all the foregoing, it is most respectfully
prayed that after due notice and hearing, judgment be rendered
ordering defendant (Jovenal Ouano) to vacate the premises and
restore the lots to their original condition; pay plaintiff
(PGTT) P100,000.00 as damages per year, beginning October, 1996
until he shall have vacated the premises and restored the lots to their
original condition; pay P100,000.00 as attorney's fees; and
pay P50,000.00 as expenses of litigation.
"Plaintiff prays for such other reliefs and remedies, just and equitable
under the premises."2
16
On February 5, 1998, Ouano filed a motion to dismiss the complaint on the
ground that it is the Municipal Trial Court (MTC), not the RTC, which has
jurisdiction over it considering that the assessed value of the lots involved is
only P2,910, as indicated in the latest tax declaration, 3 citing Section 19
(paragraph 2) and Section 33 (paragraph 3) of Batas Pambansa Bilang 129
(The Judiciary Reorganization Act of 1980), as amended by Republic Act No.
7691.4
In its opposition to Ouanos motion, PGTT contends that the RTC has
jurisdiction since the market value of the lots is P49,760.00.5 Besides, the
complaint is not only an action for recovery of ownership and possession of
real property, but also for damages exceeding P100,000.00, over which claim
the RTC has exclusive original jurisdiction under Section 19 (paragraph 8) of
the same law.
On March 6, 1998, the RTC, presided by Judge Ramon G. Codilla, Jr., issued
an Order denying the motion to dismiss, holding that:
"This court believes that this court has jurisdiction to try this case
considering that the real properties consist of ten parcels of land in a
subdivision and the court takes note that there is a discrepancy
somewhere by the Office of the City Assessor in the Assessment of
the parcels of land for only less thanP2,000.00 and that the
government is very much at a loss by these unrealistic valuation." 6
Ouano filed a motion for reconsideration but was likewise denied by the RTC
in its Order dated May 27, 1998. The trial court ruled it has jurisdiction over
the case because "(i)t is of judicial knowledge that the real properties situated
in Cebu City command a higher valuation than those indicated in the tax
declaration. The observation of plaintiffs (PGTTs) counsel as to the issue
on damages is likewise sustained considering that, being a corporation, it
may have incurred damages in the form of unrealized profits." 7
Hence the present petition for certiorari filed by Ouano under Rule 65 of the
1997 Rules of Civil Procedure, as amended, assailing the Orders of
respondent judge dated March 6, 1998 and May 27, 1998 as having been
issued with grave abuse of discretion amounting to lack or excess of
jurisdiction.
At the outset, it is necessary to stress that a direct recourse to this Court is
highly improper, for it violates the established policy of strict observance of
the judicial hierarchy of courts.8 We need to reiterate, for the guidance of
petitioner, that this Courts original jurisdiction to issue a writ of certiorari (as
well as prohibition, mandamus,quo warranto, habeas corpus and injunction)
is concurrent with the Court of Appeals (CA), as in the present case, and
with the RTCs in proper cases within their respective regions. 9 However, this
concurrence of jurisdiction does not grant a party seeking any of the
extraordinary writs the absolute freedom to file his petition with the court of
his choice. This Court is a court of last resort, and must so remain if it is to
satisfactorily perform the functions assigned to it by the Constitution and
immemorial tradition.10 The hierarchy of courts determines the appropriate
forum for such petitions. Thus, petitions for the issuance of such
extraordinary writs against the first level ("inferior") courts should be filed
with the RTC, and those against the latter, with the CA.11 A direct invocation
of this Courts original jurisdiction to issue these writs should be allowed
only when there are special and important reasons therefor, clearly and
specifically set out in the petition. This is the established policy. It is a policy
that is necessary to prevent inordinate demands upon this Courts time and
attention which are better devoted to those matters within its exclusive
jurisdiction, and to prevent further over-crowding of its
docket.12 Unfortunately, the instant petition does not allege any special and
compelling reason to justify a direct recourse to this Court. However, we
deem it more appropriate and practical to resolve the controversy in order to
avoid further delay, but only in this instance.
The lone issue for our resolution is whether the RTC has jurisdiction over
Civil Case No. CEB-21319.
The complaint seeks to recover from private respondent the ownership and
possession of the lots in question and the payment of damages. Since the
action involves ownership and possession of real property, the jurisdiction
over the subject matter of the claim is determined by the assessed
value, not the market value, thereof, pursuant to Batas Pambansa Blg. 129,
as amended by R.A. 7691. Section 33 (paragraph 3) of the said law provides:
"Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial
Courts and Municipal Circuit Trial Courts in Civil Cases.
Metropolitan Trial Courts, Municipal Trial
Courts and Municipal Circuit Trial Courts shall exercise:
x x x.
(3) Exclusive original jurisdiction in all civil actions which
involve title to, or possession of, real property, or any
17
 interest therein where the assessed value of the property or
interest therein does not exceed Twenty Thousand Pesos
(P20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty Thousand Pesos
(P50,000.00) exclusive of interest, damages of whatever kind,
attorneys fees, litigation expenses and costs: Provided, That in
cases of land not declared for taxation purposes, the value of such
property shall be determined by the assessed value of the adjacent
lots.
x x x." (Emphasis ours)
Likewise, Section 19 (paragraph 2) of the same law reads:
"Sec. 19. Jurisdiction in civil cases. - The Regional Trial
Court shall exercise exclusive originaljurisdiction:
x x x.
(2) In all civil actions, which involve the title to, or possession of,
real property, or any interest therein,where the assessed value of
the property involved exceeds Twenty Thousand Pesos
(P20,000.00)or, for civil actions in Metro Manila, where such value
exceeds Fifty Thousand Pesos (P50,000.00) except actions for
forcible entry into and unlawful detainer of lands or buildings,
original jurisdiction over which is conferred upon the Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial
Courts;
x x x." (Emphasis ours)
It is undisputed that the assessed value of the property involved, as shown by
the corresponding tax declaration, is only P2,910.00. As such, the complaint
is well within the MTCs P20,000.00 jurisdictional limit.
The finding of respondent judge that the value of the lots is higher than that
indicated in the tax declaration and that, therefore, the RTC has jurisdiction
over the case is highly speculative. It is elementary that the tax declaration
indicating the assessed value of the property enjoys the presumption of
regularity as it has been issued by the proper government agency.
Respondent judge further held that since the complaint also seeks the
recovery of damages exceedingP100,000.00, then it is within the competence
of the RTC pursuant to Section 19 (paragraph 8) of Batas Pambansa
Blg. 129, as amended by R.A. 7691, which states:
"SEC. 19. Jurisdiction in civil cases. Regional Trial Courts shall
exercise exclusive original jurisdiction:
xxx
"(8) In all other cases in which the demand, exclusive of interest,
damages of whatever kind, attorneys fees, litigation expenses, and
costs or the value of the property in controversy exceeds One
Hundred Thousand Pesos (P100,000.00) or, in such other cases in
Metro Manila, where the demand, exclusive of the above mentioned
items exceeds Two hundred thousand pesos (P200,000.00)."
(Emphasis ours)
The above provision does not apply to the instant case. It is applicable only
to "all other cases" other than an action involving title to, or possession
of real property in which the assessed value is the controlling factor in
determining the courts jurisdiction. Besides, the same provision explicitly
excludes from the determination of the jurisdictional amount the demand for
"interest, damages of whatever kind, attorneys fees, litigation expenses,
and costs". The exclusion of such damages is reiterated in Section 33,
paragraph 3 of the sameBatas Pambansa Blg. 129, as amended, quoted
earlier. The said damages are merely incidental to, or a consequence of, the
main cause of action for recovery of ownership and possession of real
property. In this connection, this Court issued Administrative Circular No.
09-94 setting the guidelines in the implementation of R.A. 7691. Paragraph 2
states:
"2. The exclusion of the term damages of whatever kind in
determining the jurisdictional amount under Section 19 (8) and
Section 33 (1) of B.P. Blg. 129, as amended by R.A. 7691, applies
to cases where the damages are merely incidental to or a
consequence of the main cause of action.However, in cases where
the claim for damages is the main cause of action, or one of the
causes of action, the amount of such claim shall be considered in
determining the jurisdiction of the court." (Emphasis ours)
18
We thus find that in issuing the assailed orders denying petitioners motion to
dismiss, thus taking cognizance of the case, the RTC committed grave abuse
of discretion.

WHEREFORE, the instant petition is GRANTED. The assailed Orders

issued by respondent RTC on March 6, 1998 and May 27, 1998 in Civil Case
No. CEB-21319 are SET ASIDE. Accordingly, the complaint is ordered
DISMISSED.

Footnotes

4 An Act Expanding The Jurisdiction of the Metropolitan Trial Courts,

Municipal Trial Courts, and Municipal Circuit Trial Courts, Amending for the
Purpose Batas Pambansa Blg. 129, otherwise known as The Judiciary
Reorganization Act of 1980.

13. ZOSIMO OCTAVIO and JESUS ALBONA (substituted by his wife,

VIOLETA ALBONA) v. ENRICO R. PEROVANO
G.R. No. 172400 June 23, 2009
Batas Pambansa Blg. 129

Before us is the appeal of petitioners Zosimo Octavio and Jesus Albona

(deceased and substituted by his wife Violeta Albona) from the
Decision1 dated January 18, 2006 of the Court of Appeals, Cebu City,
Eighteenth Division, in CA-G.R. SP No. 78843. The Court of Appeals
affirmed the Decision2 dated April 14, 2003 and Resolution3 dated July 3,
2003 of the Regional Trial Court (RTC) of Bacolod City, Branch 46 in Civil
Case No. 01-11392 which affirmed in toto the Decision4 of the Municipal
Trial Court in Cities (MTCC) of Talisay City, Negros Occidental in Civil
Case No. 671 ordering petitioners to vacate a parcel of land registered in the
name of respondent Enrico Perovano.

The facts, as culled from the records, are as follows:

19
On March 9, 1999, respondent Enrico Perovano (Enrico) filed a
Complaint5 for Forcible Entry with Damages and Prayer for Immediate
Issuance of Temporary Restraining Order or Writ of Preliminary Injunction
against Zosimo Octavio (Zosimo), Jesus Albona (Jesus), and Municipal
Agrarian Reform Officer (MARO) Dolores Gulmatico (Dolores) before the
MTCC. The complaint was docketed as Civil Case No. 671.
In his complaint, Enrico alleged he is the lawful and registered owner of Lot
No. 412 situated at the City of Talisay, Negros Occidental, comprising an
area of 48,693 square meters, more or less, and covered by TCT No. T-
179767. 6 He averred that on or before the first week of January 1999,
Zosimo and Jesus, upon the instruction and direction, and in connivance and
conspiracy with Dolores, by threat, intimidation, strategy and stealth, entered
the land, plowed it and started planting sugarcane plants inspite of the efforts
of Myrna Ayudante, Enricos Attorney-in-Fact, to prohibit them from
trespassing on the property.
In their Answer with Affirmative Defenses and Motion to Dismiss, 7 Zosimo,
Jesus and Dolores denied Enricos allegations and argued that the land was
voluntarily offered for sale by Estefania Perovano, Enricos mother, to the
Department of Agrarian Reform (DAR) in 1992. By reason of the Voluntary
Offer to Sell (VOS), the landowner (Estefania) placed the land under the
coverage of Republic Act No. 6657,8 otherwise known as the
"Comprehensive Agrarian Reform Law of 1998." They further alleged that
immediately thereafter, the processing of the VOS Claim Folder was initiated
by the DAR Municipal Office of Talisay, Negros Occidental; identification
and registration of qualified farmer-beneficiaries pursuant to Section 22 9 of
Rep. Act No. 6657 was conducted by the DAR Municipal Office of Talisay;
and Zosimo and Jesus were among those identified and qualified as farmer-
beneficiaries of the land. The VOS Claim Folder was elevated to the DAR
Municipal Office for review and evaluation and when the processing of the
Claim Folder was completed, the latter was forwarded to the Land Bank of
the Philippines for valuation. Afterwards, payment to the landowner was
made. Certificates of Land Ownership Award (CLOAs) were then generated
in favor of the farmer-beneficiaries. Accordingly, petitioners argue that
Estefania ceased to be the owner of the land and it is not true that Enrico is
still the lawful and registered owner of the landholding. 10 Petitioners add that
a Memorandum of Agreement11 was executed between Estefania Perovano
and the farmer-beneficiaries wherein they agreed that the farmer-
beneficiaries are free to take possession and cultivate the landholding after
payment was made to the landowner by the Land Bank of the
Philippines.12 They posit that there is no iota of doubt that the landholding is
within the coverage of the Comprehensive Agrarian Reform Program
(CARP) and it is only the Provincial Agrarian Reform Adjudication Board
which has original and exclusive jurisdiction to entertain any action as per
Section 50,13 Rep. Act No. 6657.14 They argue that regular courts were
already divested of their general jurisdiction to try agrarian reform
matters,15 and the filing of the case is pure and simple harassment with the
purpose of preventing or obstructing the implementation of the CARP.16
On December 29, 2000, the MTCC of Talisay City rendered a Decision in
favor of Enrico and ordered petitioners Zosimo and Jesus to vacate the
premises. The dispositive portion of the Decision states:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in
favor of the plaintiff. Defendants herein are ordered:
1. To vacate Lot 412, Talisay Cadastre, subject of the instant case,
remove all improvements introduced thereon and stop further
cultivation of the land and to return possession of the same to the
plaintiff;
2. Defendants Zosimo Octavio and Jesus Alb[o]na are ordered to pay
solidarily herein plaintiff Enrico Perovano the amount of thirty two
thousand pesos (P32,000.00) as yearly rental of the land from the
time of the filing of the complaint until plaintiff is restored to the
possession of the lot subject of this case.
3. Defendants herein Zosimo Octavio, Jesus Alb[o]na and Dolores
Gulmatico are ordered to pay or reimburse solidarily plaintiff the
amount of ten thousand pesos (P10,000.00) for attorneys fees as
well asP500.00 per court appearance.
To pay the cost of the suit.
SO ORDERED.17
Petitioners appealed to the RTC of Negros Occidental, Branch 46, which, in a
Decision dated April 14, 2003, affirmed the MTCC Decision in toto. The
dispositive portion of the RTC Decision reads:
WHEREFORE, in view of the foregoing considerations, this Court finds the
Decision of the Municipal Trial Court in Cities, Talisay City, Negros
20
Occidental, dated December 29, 2000 to be supported by law and evidence,
and finding no cogent reason to disturb, modify, revise or reverse the same,
said Decision is hereby AFFIRMED in toto. With costs against the
defendants-appellants.
SO ORDERED.18
The Court of Appeals, in a Decision promulgated on January 18, 2006,
affirmed the RTC Decision, as follows:
WHEREFORE, premises considered, the petition is DENIED. Accordingly,
the Decision dated April 14, 2003 and the Resolution dated July 3, 2003 of
the respondent Regional Trial Court of Negros Occidental
are AFFIRMED in toto.
SO ORDERED19.
Hence, this petition for review on certiorari.
Petitioners raise the following issues for our resolution:
I. WHETHER OR NOT THE SUBJECT LANDHOLDING LOT
412 IS COVERED BY THE COMPREHENSIVE AGRARIAN
REFORM PROGRAM, THUS THE CONVEYANCE OF THE
SUBJECT LOT 412 BY ESTEFANIA [PEROVANO] TO HER
SON [ENRICO R. PEROVANO]; THE EXECUTION OF A
LEASE CONTRACT BY ENRICO [PEROVANO] IN FAVOR
OF CARMELA VALLEY CORPORATION; AND OTHER
SUBSEQUENT TRANSACTIONS ARE VOID.
II. WHETHER OR NOT THE CASE FILED BY THE
RESPONDENT AGAINST THE HEREIN PETITIONERS IS
TANTAMOUNT TO A CASE OF DISQUALIFICATION OF
THE LATTER AS DULY INSTALLED FARMER
BENEFICIARIES OF THE SUBJECT LOT 412, HENCE
AGRARIAN IN CHARACTER.
III. WHETHER OR NOT THE HONORABLE COURT OF
APPEALS, CEBU CITY GRAVELY ERRED IN DENYING
THE PETITION FILED BY THE PETITIONERS AND IN
AFFIRMING THE DECISION DATED APRIL 14, 2003 AND
THE RESOLUTION DATED JULY 3, 2003 OF THE
HONORABLE REGIONAL TRIAL COURT, BRANCH 46,
BACOLOD CITY FOR THE INSTANT CASE INVOLVES
THE IMPLEMENTATION OF THE COMPREHENSIVE
AGRARIAN REFORM PROGRAM (CARP), WHICH IS AN
AGRARIAN MATTER, THEREBY DIVESTING THE
REGULAR COURT OF ITS JURISDICTION.20
The issue boils down to whether or not the case is an ejectment suit within
the exclusive jurisdiction of the trial court or an agrarian dispute within the
exclusive jurisdiction of the DAR.
Petitioners in their Memorandum21 argue that the subject Lot No. 412 of the
Talisay Cadastre was subjected to a voluntary offer to sell by no other than
the previous owner, Estefania Perovano, on June 18, 1992; that on September
8, 1992, a Memorandum of Agreement was executed between Estefania and
the farmer-beneficiaries which included Zosimo and Jesus; the DAR
generated a CLOA and the previous title in the name of the previous owner
was canceled and thereafter the farmer-beneficiaries took possession of the
same; the former landowner had already received payment for the land from
the Republic of the Philippines through the Land Bank of the Philippines.
Petitioners clarified that since farmer-beneficiaries Arsenio Bene, Ricardo
Orocio and Myrna Ayudante who were CLOA holders of the subject Lot No.
412 abandoned the subject property after selling their rights to the landowner,
which acts are gross violations of Rep. Act No. 6657, they were
recommended for disqualification. In their stead, Zosimo and Jesus were
installed as farmer-beneficiaries. They point out that Regional Director Elmo
A. Baares of DAR Region VI, in an Order22 dated March 11, 1997, denied
the protest filed by Enrico Perovano against coverage of Lot No. 412. On
January 19, 1998, Regional Director Dominador Andres, DAR, Iloilo City,
issued an order granting the exemption of the subject Lot No. 412 from
coverage of Rep. Act No. 6657, but said order was reversed on February 3,
2006, by DAR Secretary Nasser C. Pangandaman.
On the other hand, respondent, in his Memorandum, 23 argue that the
existence or absence of an agrarian dispute is a question of fact which is not
proper for review under Rule 45 of the Rules of Court. Respondent likewise
maintains that petitioners herein are not CLOA holders and hence, they have
no basis to state that they are farmer-beneficiaries. Further, no tenancy
relationship exists between petitioners and respondent. Being an ejectment
case, only the issue of possession is involved.
21
At the outset, let us be clear that jurisdiction over the subject matter of an
action is determined by the material allegations of the complaint and the law
at the time the action is commenced, irrespective of whether the plaintiff is
entitled to recover all or some of the claims or reliefs sought therein. It
cannot be made to depend upon the defenses set up in the answer or upon a
motion to dismiss; otherwise, the question of jurisdiction would depend
almost entirely on the defendant.24
A scrutiny of the material allegations in respondents complaint before the
MTCC shows that it involvespossession de facto, the only issue involved in
ejectment proceedings. Enrico alleged he is the lawful and registered owner
of Lot No. 412 and that on or before the first week of January 1999,
petitioners Zosimo and Jesus, by threat, intimidation, strategy and stealth,
entered the premises of the land, plowed it and started planting sugarcane.
Under Batas Pambansa Blg. 129,25 as amended by Rep. Act No. 7691,26 the
MTC shall have exclusive original jurisdiction over cases of forcible entry
and unlawful detainer. The Revised Rules on Summary Procedure27governs
the remedial aspects of such suits.28lawphil.net
Under Section 50 of Rep. Act No. 6657, the DAR is vested with "primary
jurisdiction to determine and adjudicate agrarian reform matters and shall
have exclusive original jurisdiction over all matters involving the
implementation of agrarian reform."29 An agrarian dispute refers to any
controversy relating to, inter alia, tenancy over lands devoted to
agriculture.30 Under Section 3(d) of Rep. Act No. 6657, an agrarian dispute
refers to any controversy relating to tenurial arrangements, whether
leasehold, tenancy, stewardship or otherwise, over lands devoted to
agriculture, including disputes concerning farmworkers associations or
representation of persons in negotiating, fixing, maintaining, changing or
seeking to arrange terms or conditions of such tenurial arrangements. It
includes any controversy relating to compensation of lands acquired under
this Act and other terms and conditions of transfer of ownership from
landowner to farmworkers, tenants and other agrarian reform beneficiaries,
whether the disputants stand in the proximate relation of farm operator and
beneficiary, landowner and tenant, or lessor and lessee. It refers to any
controversy relating to, inter alia, tenancy over lands devoted to agriculture.31
Petitioners argue that the subject landholding is covered by the CARP and
thus the conveyance of the lot by Estefania to her son Enrico after she
voluntarily offered to sell her property to the DAR is void. There is no
question that the land is covered by the CARP. Records show that DAR
Secretary Nasser C. Pangandaman issued an Order on February 3, 2006
reversing the order of DAR Regional Director Dominador B. Andres granting
Enricos petition for exemption of the land.
However, whether or not petitioners are duly installed farmer-beneficiaries is
a finding of fact. It is well-settled that in a petition for review on certiorari
under Rule 45 of the Rules of Court, only questions of law may be raised. We
have time and again ruled that the factual findings of fact by administrative
agencies are generally accorded great respect, if not finality, by the courts
because of the special knowledge and expertise of administrative
departments over matters falling under their jurisdiction. 32 As held by this
Court in Sta. Rosa Realty v. Court of Appeals, et al.,33 the identification of
farmer-beneficiaries is best left to the discretion of the Secretary of Agrarian
Reform, through its authorized offices, as this is a matter involving strictly
the administrative implementation of the CARP, and unless the Court finds
that there was grave abuse of discretion committed by the agency involved,
which the Court finds absent in this case, it will not substitute its judgment to
that of the agencys.34
Records show that the Department of Agrarian Reform Adjudication Board
(DARAB) promulgated on June 3, 2005 a Decision ruling that Zosimo and
Jesus are not recognized farmer-beneficiaries. The DARAB ruled:
It appears that complainants-appellants (which included Zosimo and Jesus)
were not among those three (3) non-CLOA holders occupying portions of Lot
Nos. 412 and 04 who were given one-hectare land each as disturbance
compensation. Otherwise, they would have not filed this case on 23 February
1999. It must be remembered the 19 January 1998 Order was declared final
on 19 October 1998 and the original complaint was filed on 23 February
1999.
Thus, this Board is of the opinion that complainants-appellants were not
recognized as farmer-beneficiaries of the subject landholding. Their
continued possession thereof was through stealth. Even if they were not
identified as farmer-beneficiaries and not awarded any CLOA, they
arrogated unto themselves the portions of the subject landholding. As
admitted by them in the hearing, they came into the land on the premise that
they are farmer-beneficiaries. Without waiting for an award of any CLOA,
complainants-appellants occupied the landholding. In the process,
"expropriating" the property of the landowner without due process of law,
prejudicing the rights of the landowner and the legitimate farmer-
beneficiaries who were duly awarded with CLOA.
22
The acts of the complainants-appellants are similar to that of land grabbing.
The agrarian reform law is not enacted to give license to anybody to grab
somebody elses land. Neither [is it] enacted to protect the land grabbers or
the squatters.35 (Emphasis supplied.)
Petitioners argument that the case involves an agrarian matter divesting the
regular courts of jurisdiction therefore has no merit. They are not farmer-
beneficiaries but mere usurpers of the land.
The MTCC properly ruled that:
x x x Defendants [petitioners herein] claim of ownership [as] farmer-
beneficiaries is not evidenced [by] any Certificate of Land Ownership Award
(CLOA) for nothing is shown that they are CLOA holders. Likewise, it is
clearly established that defendants herein Zosimo Octavio and Jesus Alb[o]na
remained at plaintiffs [L]ot 414 and did not reside on Lot 412 for they were
residents of Lot 414 for more than 20 years to date as declared by them in
their Joint Affidavits executed on November 20, 2000 at Iloilo City.36
Clearly, therefore, the action is one for ejectment and the MTCC has
jurisdiction over it.
WHEREFORE, the petition is DENIED. The Decision dated January 18,
2006 of the Court of Appeals, Cebu City, Eighteenth Division, in CA-G.R.
SP No. 78843 is AFFIRMED.
Footnotes
8
Done and adopted on December 26, 1998.
9
SEC. 22. Qualified Beneficiaries. The lands covered by the CARP
shall be distributed as much as possible to landless residents of the
same barangay, or in the absence thereof, landless residents of the
same municipality in the following order of priority:
(a) agricultural lessees and share tenants;
(b) regular farmworkers;
(c) seasonal farmworkers;
(d) other farmworkers;
(e) actual tillers or occupants of public lands;
(f) collectives or cooperatives of the above
beneficiaries; and
(g) others directly working on the land.
Provided, however, That the children of landowners who are
qualified under Section 6 of this Act shall be given
preference in the distribution of the land of their parents;
And provided, further, That actual tenant -tillers in the
landholding shall not be ejected or removed therefrom.
Beneficiaries under Presidential Decree No. 27 who have
culpably sold, disposed of, or abandoned their land are
disqualified to become beneficiaries under this Program.
A basic qualification of a beneficiary shall be his
willingness, aptitude and ability to cultivate and make the
land as productive as possible. The DAR shall adopt a
system of monitoring the record or performance of each
beneficiary, so that any beneficiary guilty of negligence or
misuse of the land or any support extended to him shall
forfeit his right to continue as such beneficiary. The DAR
shall submit periodic reports on the performance of the
beneficiaries to the PARC.
If, due to the landowners retention rights or to the number
of tenants, lessees, or workers on the land, there is not
enough land to accommodate any or some of them, they may
be granted ownership of other lands available for distribution
under this Act, at the option of the beneficiaries.
Farmers already in place and those not accommodated in the
distribution of privately-owned lands will be given
preferential rights in the distribution of lands from the public
domain.
23
13
SEC. 50. Quasi-Judicial Powers of the DAR. The DAR is hereby
vested with primary jurisdiction to determine and adjudicate agrarian
reform matters and shall have exclusive original jurisdiction over all
matters involving the implementation of agrarian reform, except
those falling under the exclusive jurisdiction of the Department of
Agriculture (DA) and the Department of Environment and Natural
Resources (DENR).
26
An Act Expanding the Jurisdiction of the Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts,
Amending for the Purpose Batas Pambansa Blg. 129, Otherwise
Known as the "Judiciary Reorganization Act of 1980", approved on
March 25, 1994.

It shall not be bound by technical rules of procedure and

evidence but shall proceed to hear and decide all cases,
disputes or controversies in a most expeditious manner,
employing all reasonable means to ascertain the facts of
every case in accordance with justice and equity and the
merits of the case. Toward this end, it shall adopt a uniform
rule of procedure to achieve a just, expeditious and
inexpensive determination of every action or proceeding
before it.

It shall have the power to summon witnesses, administer

oaths, take testimony, require submission of reports, compel
the production of books and documents and answers to
interrogatories and issue subpoena, and subpoena
duces tecum and to enforce its writs through sheriffs or other
duly deputized officers. It shall likewise have the power to
punish direct and indirect contempts in the same manner and
subject to the same penalties as provided in the Rules of
Court.

Responsible farmer leaders shall be allowed to represent

themselves, their fellow farmers or their organizations in any
proceedings before the DAR; Provided, however, That when
there are two or more representatives for any individual or
group, the representatives should choose only one among
themselves to represent such party or group before any DAR
proceeding.

Notwithstanding an appeal to the Court of Appeals, the

decision of the DAR shall be immediately executory.

25
The Judiciary Reorganization Act of 1980, approved on August 14,
1981.

24

14. PRECY BUNYI and MILA BUNYI v. FE S. FACTOR
G.R. No. 172547 June 30, 2009
Batas Pambansa Blg. 129
For review on certiorari are the Decision1 dated January 16, 2006 and
Resolution2 dated April 26, 2006 of the Court of Appeals in CA-G.R. SP No.
90397, which had affirmed the Decision3 dated March 7, 2005 of the
Regional Trial Court (RTC) of Las Pias City, Branch 198 in Civil Case No.
LP-04-0160.
The antecedent facts are as follows:
Respondent Fe S. Factor is one of the co-owners of an 18-hectare piece of
land located in Almanza, Las Pias City. The ownership of the land
originated from respondents paternal grandparents Constantino Factor and
Maura Mayuga-Factor who had been in actual, continuous, peaceful, public,
adverse and exclusive possession and occupation of the land even before
1906.4
On December 9, 1975, the children of Constantino Factor and Maura
Mayuga-Factor filed a Petition for Original Registration and Confirmation of
Imperfect Title to the said parcel of land, or Lots 1, 2, 3 and 4 of Psu-253567,
before the RTC of Pasig City, Branch 71.5 On December 8, 1994, the trial
court granted the petition in LRC Case No. N-9049 and declared the children
of Constantino Factor and Maura Mayuga-Factor as co-owners of the
property. 6 The children of Constantino Factor and Maura Mayuga-Factor
thereafter sold seven (7) hectares of the Factor family property during the
same year. The siblings, except Enrique Factor, respondents father, shared
and divided the proceeds of the sale among themselves, with the agreement
that Enrique would have as his share the portion of the property located in
Antioch Street, Pilar Executive Village, Almanza I, Las Pias City, known as
the Factor compound.
Following his acquisition thereof, Enrique caused the construction of several
houses in the compound including the subject property, a rest house, where
members of the Factor family stayed during get-togethers and
visits.7Petitioners Precy Bunyi and her mother, Mila Bunyi, were tenants in
one of the houses inside the compound, particularly in No. 8 Antioch St.,
Pilar Village, Almanza, Las Pias City since 1999.8
When Enrique Factor died on August 7, 1993, the administration of the
Factor compound including the subject rest house and other residential
houses for lease was transferred and entrusted to Enriques eldest child,
Gloria Factor-Labao.
Gloria Factor-Labao, together with her husband Ruben Labao and their son
Reggie F. Labao, lived in Tipaz, Taguig, Metro Manila but visited and
sometimes stayed in the rest house because Gloria collected the rentals of the
residential houses and oversaw the Factor compound. When Gloria died on
January 15, 2001, the administration and management of the Factor
compound including the subject rest house, passed on to respondent Fe S.
Factor as co-owner of the property. As an act of goodwill and compassion,
considering that Ruben Labao was sickly and had no means of income,
respondent allowed him to stay at the rest house for brief, transient and
intermittent visits as a guest of the Factor family.
On May 31, 2002, Ruben Labao married petitioner Precy Bunyi. On
November 10, 2002, Ruben Labao died.
25
At about this time, respondent discovered that petitioners forcibly opened the
doors of the rest house and stole all the personal properties owned by the
Factor family and then audaciously occupied the premises. Respondent
alleged that petitioners unlawfully deprived her and the Factor family of the
subject propertys lawful use and possession. Respondent also added that
when she tried to enter the rest house on December 1, 2002, an unidentified
person who claimed to have been authorized by petitioners to occupy the
premises, barred, threatened and chased her with a jungle bolo. Thus, on
September 12, 2003, respondent Fe S. Factor filed a complaint 9 for forcible
entry against herein petitioners Precy Bunyi and Mila Bunyi.
Petitioners, for their part, questioned Fes claim of ownership of the subject
property and the alleged prior ownership of her father Enrique Factor. They
asserted that the subject property was owned by Ruben Labao, and that
petitioner Precy with her husband moved into the subject property, while
petitioner Mila Bunyi, mother of Precy, remained in No. 8 Antioch St.
On July 13, 2004, the Metropolitan Trial Court (MeTC) of Las Pias City,
Branch 79 ruled in favor of Fe S. Factor. The dispositive portion of the
decision reads:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff and
against the defendants ordering the latter and all persons claiming rights
under them to:
1. To immediately vacate the subject premises and surrender
possession thereof to the plaintiff.
2. To pay the monthly rental of P2,000.00 from December 1, 2002 up
to the time they finally vacate the premises.
3. To pay attorneys fee of Php 10,000.00.
The counter-claim is dismissed for lack of merit.
SO ORDERED.10
Petitioners appealed the decision to the RTC of Las Pias City, Branch 198,
which, however, affirmed in toto the decision of the MeTC and later denied
their motion for reconsideration.11 Undaunted, petitioners filed a petition for
review before the Court of Appeals but it was denied also. Hence, the instant
petition before us.
Petitioners submit the following issues for the Courts consideration:
I. [WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN LAW AND JURISPRUDENCE
WHEN IT AFFIRMED THE DECISION OF THE REGIONAL
TRIAL COURT THAT FORCE, THREAT, INTIMIDATION
AND STEALTH HAD BEEN COMMITTED BY THE
PETITIONERS IN OCCUPYING THE SUBJECT
RESIDENTIAL HOUSE;
II. [WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED WHEN IT MISAPPRECIATED THE
FACT THAT THE RESPONDENT HAS A BETTER RIGHT OF
PHYSICAL AND MATERIAL POSSESSION OF THE
SUBJECT PROPERTY;
III. [WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN AFFIRMING THE FINDING OF THE
REGIONAL [TRIAL] COURT HOLDING PETITIONERS
LIABLE TO PAY THE MONTHLY RENTAL OF P2,000.00
FROM DECEMBER 1, 2002 UP TO THE TIME THEY
FINALLY VACATE PREMISES.12
The resolution of the first issue raised by petitioners requires us to inquire
into the sufficiency of the evidence presented below, a course of action which
this Court will not do, consistent with our repeated holding that the Supreme
Court is not a trier of facts.13 The resolution of factual issues is the function
of lower courts, whose findings on these matters are received with respect
and considered binding by the Supreme Court subject only to certain
exceptions, none of which is present in the instant petition. 14 Noteworthy, in
this case, the cited findings of the RTC have been affirmed by the Court of
Appeals.
As to the second issue, the resolution thereof boils down to a determination
of who, between petitioners and respondent, would be entitled to the physical
possession of the subject property.
Both parties anchor their right of material possession of the disputed property
on their respective claims of ownership. Petitioners insist that petitioner
26
Precy has a better right of possession over the subject property since she
inherited the subject property as the surviving spouse and sole heir of Ruben
Labao, who owned the property before his death.
Respondent, on the other hand, hinges her claim of possession on the fact
that her predecessor-in-interest had prior possession of the property as early
as 1975.
After careful consideration, we find in favor of the respondent.
In ejectment cases, the only issue for resolution is who is entitled to the
physical or material possession of the property involved, independent of any
claim of ownership set forth by any of the party-litigants. The one who can
prove prior possession de facto may recover such possession even from the
owner himself.15 Possession de facto is the physical possession of real
property. Possession de facto and not possession de jure is the only issue in a
forcible entry case.16 This rule holds true regardless of the character of a
partys possession, provided, that he has in his favor priority of time which
entitles him to stay on the property until he is lawfully ejected by a person
having a better right by either accion publiciana or accion reivindicatoria. 17
Petitioners argue that respondent was never in possession of the subject
property since the latter never occupied the same. They claim that they have
been in actual possession of the disputed property from the time petitioner
Precy married Ruben Labao in 2002.
In this instance, however, petitioners contention is unconvincing.
For one to be considered in possession, one need not have actual or physical
occupation of every square inch of the property at all times. 18 Possession can
be acquired not only by material occupation, but also by the fact that a thing
is subject to the action of ones will or by the proper acts and legal
formalities established for acquiring such right. 19 Possession can be acquired
by juridical acts. These are acts to which the law gives the force of acts of
possession. Examples of these are donations, succession, execution and
registration of public instruments, and the inscription of possessory
information titles.20
While petitioners claim that respondent never physically occupied the subject
property, they failed to prove that they had prior possession of the subject
property. On record, petitioner Precy Bunyi admitted that Gloria Factor-
Labao and Ruben Labao, as spouses, resided in Tipaz, Taguig, Metro Manila
and used the subject property whenever they visit the same. 21 Likewise, as
pointed out by the MeTC and the RTC, Ruben and petitioner Precys
marriage certificate revealed that at the time of their marriage, Ruben was
residing at 123 A. Lake St., San Juan, Metro Manila. Even Rubens death
certificate showed that his place of death and residence was at #4 Labao St.,
Tipaz, Taguig, Metro Manila. Considering that her husband was never a
resident of the subject property, petitioner Precy failed to explain
convincingly how she was able to move in with Ruben Labao in the subject
property during their marriage.
On the other hand, it was established that respondents grandparents,
Constantino Factor and Maura Mayuga-Factor, had been the occupants and in
possession of various agricultural parcel of lands situated in Almanza, Las
Pias City, in the concept of owners, for more than thirty years prior to 1975.
In fact, the RTC in its Decision dated December 8, 1994 in LRC Case No. N-
9049 has confirmed the rights of respondents predecessors over the subject
property and ordered the issuance of the corresponding certificate of title in
their favor.22
The right of respondents predecessors over the subject property is more than
sufficient to uphold respondents right to possession over the same.
Respondents right to the property was vested in her along with her siblings
from the moment of their fathers death.23 As heir, respondent had the right to
the possession of the property, which is one of the attributes of ownership.
Such rights are enforced and protected from encroachments made or
attempted before the judicial declaration since respondent acquired hereditary
rights even before judicial declaration in testate or intestate proceedings. 24
After the death of Enrique Factor, it was his eldest child, Gloria Factor-Labao
who took over the administration of the subject property. And as a
consequence of co-ownership,25 soon after the death of Gloria, respondent, as
one of the surviving co-owners, may be subrogated to the rights of the
deceased co-owner, which includes the right to the administration and
management of the subject property.
As found by the Court of Appeals, petitioners unsupported claim of
possession must yield to that of the respondent who traces her possession of
the subject property to her predecessors-in-interest who have always been in
possession of the subject property. Even assuming that respondent was never
a resident of the subject property, she could legally continue possessing the
property. Visiting the property on weekends and holidays is evidence of
27
actual or physical possession.26 The fact of her residence somewhere else, by
itself, does not result in loss of possession of the subject property. The law
does not require one in possession of a house to reside in the house to
maintain his possession.27 For, again, possession in the eyes of the law does
not mean that a man has to have his feet on every square meter of the ground
before he is deemed in possession.28 There is no cogent reason to deviate
from this doctrine.
All things considered, this Court finds that respondent Fe S. Factor
successfully proved the extent and character of her possession over the
disputed property. As a consequence of her ownership thereof, respondent is
entitled to its possession, considering petitioners failure to prove prior
possession. The Court stresses, however, that its determination of ownership
in the instant case is not final. It is only a provisional determination for the
sole purpose of resolving the issue of possession. It would not bar or
prejudice a separate action between the same parties involving the quieting of
title to the subject property.29
As regards the means upon which the deprivation took effect, it is not
necessary that the respondent must demonstrate that the taking was done with
force, intimidation threat, strategy or stealth. The Supreme Court, in Baes v.
Lutheran Church in the Philippines,30 explained:
In order to constitute force that would justify a forcible entry case, the
trespasser does not have to institute a state of war. The act of going to the
property and excluding the lawful possessor therefrom necessarily implies
the exertion of force over the property which is all that is necessary and
sufficient to show that the action is based on the provisions of Section 1,
Rule 70 of the Rules of Court.31
32
As expressly stated in David v. Cordova:
The words by force, intimidation, threat, strategy or stealth include every
situation or condition under which one person can wrongfully enter upon real
property and exclude another, who has had prior possession therefrom. If a
trespasser enters upon land in open daylight, under the very eyes of the
person already clothed with lawful possession, but without the consent of the
latter, and there plants himself and excludes such prior possessor from the
property, the action of forcible entry and detainer can unquestionably be
maintained, even though no force is used by the trespasser other than such as
is necessarily implied from the mere acts of planting himself on the ground
and excluding the other party.33
Respondent, as co-owner, has the control of the subject property even if she
does not stay in it. So when petitioners entered said property without the
consent and permission of the respondent and the other co-owners, the latter
were deprived of its possession. Moreover, the presence of an unidentified
man forbidding respondent from entering the subject property constitutes
force contemplated by Section 1,34 Rule 70 of the Rules of Court.1avvphi1
As to the last issue, we have previously ruled that while the courts may fix
the reasonable amount of rent for the use and occupation of a disputed
property, they could not simply rely on their own appreciation of land values
without considering any evidence. The reasonable amount of any rent could
not be determined by mere judicial notice but by supporting evidence. 35 In
the instant case, we find no evidence on record to support the MeTCs award
of rent.
On the matter of attorneys fees awarded to the respondent, we are in
agreement to delete it. It is a well-settled rule that where attorneys fees are
granted, the court must explicitly state in the body of the decision, and not
only in the dispositive portion thereof, the legal reason for the
award.36 Again, nothing in the body of both decisions of RTC and MeTC
explicitly stated the reasons for the award of attorneys fees.
WHEREFORE, the instant petition is DENIED. The challenged Decision
dated January 16, 2006 and Resolution dated April 26, 2006 of the Court of
Appeals in CA-G.R. SP No. 90397 are AFFIRMED with MODIFICATION
that the award of rentals and attorneys fees are DELETED.
Footnotes
25
Civil Code,
Art. 484. There is co-ownership whenever the ownership of an undivided
thing or right belongs to different persons.
xxxx
34
SECTION 1. Who may institute proceedings, and when. Subject to the
provisions of the next succeeding section, a person deprived of the
possession of any land or building by force, intimidation, threat, strategy, or
stealth, or a lessor, vendor, vendee, or other person against whom the
possession of any land or building is unlawfully withheld after the expiration
28
or termination of the right to hold possession, by virtue of any contract,
express or implied, or the legal representatives or assigns of any such lessor,
vendor, vendee, or other person may at any time within one (1) year after
such unlawful deprivation or withholding of possession, bring an action in
the proper Municipal Trial Court against the person or persons unlawfully
withholding or depriving of possession, or any person or persons claiming
under them, for the restitution of such possession, together with damages and
costs.

15. ANGELA DELA ROSA and CORAZON MEDINA v. RFELINA D.

ROLDAN, LORNA SAN DIEGO, FLORDELIZA D. CATACUTAN,
NORMA Y. LACUESTA, and ARSENIO DULAY
G.R. No. 133882 September 5, 2006
Batas Pambansa Blg. 129

This is a Petition for Review on Certiorari of the Decision1 of the Court of

Appeals (CA) in CA-G.R. SP No. 45560 affirming, on a petition for review,
the Decision of the Regional Trial Court (RTC) of Tarlac in Civil Case No.
8396, which in turn reversed on appeal the decision of the Municipal Trial
Court (MTC) of Tarlac, Tarlac in Civil Case No. 6089 for unlawful detainer.

The Antecedents

The spouses Adriano Rivera and Aurora Mercado were the owners of two (2)
parcels of land located in Tarlac, Tarlac, both covered by respective titles; the
261-square-meter lot was covered by Transfer Certificate of Title (TCT) No.
7225, while the 772 sq. m. was covered by TCT No. 7226.

Sometime in 1957, the spouses Rivera executed a deed of sale 2 over the
properties in favor of the spouses Arsenio Dulay and Asuncion dela Rosa.

29
Gideon dela Rosa, one of Asuncion's brothers, was one of the instrumental
witnesses in the deed. To pay for the property, the spouses Dulay, who were
members of the Government Service Insurance System (GSIS), secured
a P9,500.00 loan and executed a real estate mortgage over the two lots as
security therefor. On September 16, 1957, the Register of Deeds issued TCT
Nos. 29040 and 29041 in the names of the spouses Dulay.
The spouses Dulay forthwith took possession of the lots, except a 500-
square-meter portion which was then occupied by Gideon dela Rosa and his
wife Angela and the portion where the house of Corazon Medina stood. The
spouses Dulay declared the property for taxation purposes in their names and
paid the realty taxes therefor.
Sometime in 1982, the spouses Dulay made demands on Gideon, Angela and
Corazon to vacate the premises, as their three daughters would be
constructing their respective houses thereon. Gideon, Angela and Corazon
refused to do so, prompting the spouses to file a complaint for recovery of
possession (accion publiciana) against them with the then Court of First
Instance (CFI) of Tarlac. The spouses Dulay alleged, inter alia, that they
bought the lots from the spouses Rivera in 1957; defendants occupied a 370-
square-meter portion on the western side, and were claiming ownership over
one-half of the property, as shown by their letter to plaintiffs appended to
their complaint; and they needed the property so that their daughters, who
already had their respective families, could build houses thereon. The
spouses Dulay prayed that defendants be evicted from the property and be
required to pay reasonable compensation for their use of the premises. 3 The
case was docketed as Civil Case No. 6261.
In their answer to the complaint, defendants alleged the following by way of
special and affirmative defenses: Gideon and his sister Asuncion contributed
equally to the purchase price of the property; plaintiffs secured a GSIS loan
of P9,500.00, out of which P6,500.00 was paid to the vendors; Gideon and
Asuncion verbally agreed that plaintiffs would be indicated as the sole
vendees in the deed of sale as they were the GSIS members; defendants had
already paid their share of the purchase price of the property as of 1978,
except for the amount of P332.00; and, insofar as the one-half portion on the
western side of the property was concerned, plaintiffs were trustees for
defendants, who likewise owned the same. Defendants interposed
counterclaims for damages and prayed that the said one-half portion be
reconveyed to them.4
During the trial, the spouses Dulay adduced in evidence the following: the
Deed of Absolute Sale dated January 16, 1957, with Gideon as an
instrumental witness;5 the tax declarations in their names covering the
property; and receipts of realty tax payments made over the property.6
Defendants spouses Dela Rosa adduced in evidence a small notebook
containing therein an alleged list of payments to the spouses Dulay of their
share in the purchase price of the property.7 They presented an NBI
Questioned Documents Expert to prove the authenticity of the signature of
Asuncion Dulay on one of the receipts.8 However, Asuncion denied that she
bought the property with her brother Gideon, and that she received any
amount from him and his wife as part of the purchase price of the property.
She likewise denied that it was her signature that appeared on the purported
receipt.
On July 17, 1987, the trial court rendered judgment in Civil Case No. 6261 in
favor of the spouses Dulay and ordered the spouses Dela Rosa and Corazon
Medina to vacate the property and turn over possession to plaintiffs. 9 The
trial court declared:
ANALYZING THE EVIDENCE, there is no doubt that the registered
owners of the lots in question are the plaintiffs-spouses Arsenio
Dulay and Asuncion dela Rosa (Exhibits "A" and "B"). They bought
these lots from the spouses Adriano Rivera and Aurora Mercado
(Exhibits "D" and "D-1").
Defendants' claim that they bought from the plaintiffs one-half (1/2)
portion of the lots in question is untenable. Firstly, if it is true as
claimed by them that there was such an agreement to purchase from
the plaintiffs a portion of the lots in question, why did they not
reduce [the] same in writing? In fact, it's the defendants, particularly
Gideon dela Rosa, who induced and accompanied the plaintiffs to go
to a Notary Public for the execution of Exhibit "D." The amounts
mentioned in Exhibit "5" does (sic) not clearly indicate whether they
were payments made for the purchase price in installment or for
monthly rentals for their occupation of Lot 3-B-2. The defendants
were the only ones who made entries; and a perusal of such entries
were not recorded in sequence of alleged monthly payment but
merely entries dictated and/or written at will.
Regarding Exhibit 6 and the alleged signature of plaintiff Asuncion
dela Rosa, the report (Exhibit "7," "7-A" and "7-B") and the
30
 testimony of the Chief NBI handwriting expert when presented by
the defendants themselves is very emphatic. Thus:
"However, the question signature was signed over a
typewritten carbon or duplicate."
What we mean by that, Sir, is that there is here a purported
receipt with the body typewritten underlining below the
supposed signature Asuncion R. Dulay, it is a little surprising
because if a document is prepared in one occasion, then the
body should be in ribbon impression and the underlining
should be in ribbon. The supposed typewritten body above
the signature is an original ribbon impression, that is, it is
direct from the typewritten with the ribbon striking the sheet
of paper, the underlining, however, on which the signature is
signed is a carbon impression, that means it is a duplicate
impression. (pp. 8-9, tsn., Oct. 30/85).10
The spouses Dela Rosa and Corazon Medina appealed to the CA. The case
was docketed as CA-G.R. CV No. 15455. On June 29, 1990, the appellate
court rendered judgment granting the appeal and reversed the trial court's
ruling. According to the appellate court, the complaint was premature on
account of plaintiffs' failure to allege, in their complaint, that there had been
earnest efforts to have the case amicably settled as mandated under Article
222 of the New Civil Code.11
The spouses Dulay filed a Motion for Extension of Time to File a Petition for
Review on Certiorari with this Court which was granted. The motion was
recorded as UDK-10069. However, the spouses Dulay failed to file their
petition. Thus, on November 19, 1990, the Court resolved to declare final and
executory the decision of the CA in CA-G.R. CV No. 15455 for failure of
plaintiffs-appellees to file their petition for review.12 The resolution of the
Court became final and executory.13
In the meantime, Gideon died. His wife Angela and Corazon Medina
continued residing in the property without paying any rentals therefor.
Asuncion Dulay passed away on June 26, 1995, survived by her husband
Arsenio and their children: Orfelina Roldan, Lorna San Diego, Flordeliza
Catacutan, and Norma Lacuesta.
In a letter dated October 2, 1995, Arsenio and his children, through counsel,
made demands on Corazon and Angela to vacate the property within 30 days
from receipt thereof, with a warning that failure to do so would impel them to
file the necessary legal action.14 Nevertheless, they suggested a conference to
discuss the amicable settlement of the matter. Corazon and Angela ignored
the letter. This prompted Arsenio and his children to file a complaint for
eviction against Angela and Corazon in the Office of the Barangay Captain.
The parties did not arrive at a settlement, and on December 1, 1995,
the Pangkat Secretary issued a certification to file action. 15
On January 29, 1996, Arsenio and his children, as plaintiffs, filed a complaint
for unlawful detainer against Corazon and Angela, as defendants, in the MTC
of Tarlac, Tarlac. Plaintiffs alleged the following:
3. Plaintiffs are the co-owners of two adjoining parcels of residential
land located at Tarlac, Tarlac, and more particularly described as
follows:
Transfer Certificate of Title No. 29040
"A parcel of land (Lot "B" of the subdivision plan Psd-2284,
being a portion of the land described on the original plan II-
5215, G.L.R.O. Record No. 7962), situated in the Barrio of
San Roque, Municipality of Tarlac, Province of Tarlac.
Bounded on the N.E., by Lot "C" of the subdivision plan; on
the S.E., by Lot No. "3-B-2" of the subdivision plan and
property of Concepcion Cider; on the W., by property of
Timotea Mercado; and on the N.W., by Lot "A" of the
subdivision plan, containing an area of TWO HUNDRED
SIXTY-ONE (261) SQUARE METERS, more or less."
Transfer Certificate of Title No. 29041
"A parcel of land (Lot No. "3-B-2" of the subdivision plan
Psd-2284, being a portion of Lot No. "3-B," plan II-2977-
Amd., G.L.R.O. Record No. 1955), situated in the Barrio of
San Roque, Municipality of Tarlac, Province of Tarlac.
Bounded on the N.E., by Lot 87-C of the subdivision plan;
on the S.E., by Lot No. 3-B-1 of the subdivision plan; on the
S.W., by property of Concepcion Cider; and on the N.W., by
Lot B of the subdivision plan, containing an area of SEVEN
HUNDRED SEVENTY-TWO (772) SQUARE METERS,
more or less."
31
 Copies of the transfer certificates of title are attached as
Annexes "A" and "B," respectively. The total assessed value
of said lands does not exceed Twenty Thousand Pesos
(P20,000.00).
4. Said parcels of land were formerly owned by the spouses
Asuncion dela Rosa and Arsenio Dulay. Plaintiffs Orfelina Roldan,
Lorna San Diego, Flordeliza Catacutan, and Norma Lacuesta are the
children of the spouses Asuncion dela Rosa and plaintiff Arsenio
Dulay. Upon the death of Asuncion dela Rosa on 26 June 1995, said
parcels of land became jointly owned by herein plaintiffs. A copy of
Asuncion dela Rosa's certificate of death is attached as Annex "C."
5. The spouses Dulay bought said parcels of land sometime in 1957.
Defendants and their predecessors-in-interest have occupied and are
continuously occupying about five hundred (500) square meters,
more or less, of said parcels of land. Defendants and their
predecessors-in-interest have occupied said parcels of land since
1957 without paying any rent.
6. The occupation by defendants of said parcels of land were at the
mere tolerance of the spouses Dulay and, thereafter, of the plaintiffs.
Defendants have promised to vacate the premises if and when needed
by the spouses Dulay and plaintiffs.
7. Demands were made on defendants to vacate the premises, which
demands, however, were ignored and not heeded. Defendants refused
and continues to refuse to vacate the premises. A copy of the final
demand letters sent to Angela dela Rosa and Corazon Medina are
attached as Annexes "D" and "E," respectively.
8. In an attempt to arrive at an amicable settlement and in recognition
of their being blood relatives, plaintiffs exerted earnest efforts
towards a compromise with defendants. Defendants were invited to
discuss and settle the matter amicably. Defendants, however, refused
to meet and discuss any settlement and ignored the invitation
extended by plaintiffs.
9. In compliance with Section 412 of the Local Government Code
(R.A. No. 7160) and as a further attempt to settle the dispute
amicably, plaintiffs brought the matter to the lupong
tagapamayapa of their barangay. Defendants, however, refused to
discuss an amicable settlement. The certification to file action issued
by the lupon chairman is attached and made an integral part hereof as
Annex "F."
10. Defendants have been occupying and using the premises without
paying any rent therefor. The present reasonable rental value of the
premises is Fifty Pesos (P50.00) per month, which amount
defendants should be made to pay from September 1957 until
possession is restored to plaintiffs.
11. By reason of the unjustifiable refusal to vacate and the unlawful
detainer of the subject property by defendants and all persons
claiming rights under them, plaintiffs were constrained to seek
redress in court to protect their own rights and interests, thereby
causing them to incur litigation expenses in the amount of not less
than Fifty Thousand Pesos (P50,000.00), for which amount the
defendant should be made liable to plaintiffs.16
Plaintiffs therein prayed that, after due proceedings, judgment be rendered in
their favor as follows:
WHEREFORE, premises considered, plaintiffs most respectfully
pray that, after trial, judgment be rendered by this Honorable Court
in favor of plaintiffs and ordering as follows:
1. Defendants and all persons claiming rights under them to
immediately vacate the premises;
2. Defendants to pay all rental arrears at the monthly rate of P50.00
from September 1957 until possession is restored or a total
of P23,000.00;
3. Defendants to pay litigation expenses in the amount
of P50,000.00; and
4. Defendants to pay the costs of this suit.
Plaintiffs pray for such other and further reliefs just and equitable under the
premises.17
The case was docketed as Civil Case No. 6089.
32
In their answer, defendants reiterated their allegations in their answer to the
complaint in Civil Case No. 6261 in the CFI of Tarlac.
On April 30, 1996, Angela filed a complaint against Arsenio and his children
in the MTC of Tarlac, Tarlac for recovery of ownership, reconveyance,
cancellation of title, and damages. The case was docketed as Civil Case No.
6154. Angela, as plaintiff, reiterated her allegations in her answer and
counterclaim in Civil Case No. 6261 as allegations comprising her causes of
action. She prayed that, after due proceedings, judgment be rendered in their
favor, thus:
WHEREFORE, it is most respectfully prayed of this Hon. Court that
judgment shall issue:
1. Ordering that an immediate temporary restraining order restraining
the defendants from disturbing the possession of the Plaintiff over
the property in question until the case is finally dissolved;
2. Declaring the Plaintiff as owner of the one-half (1/2) property in
question, thereby reconveying the ownership thereof and cancelling
the title;
3. Ordering the defendants, jointly and severally, to pay Plaintiff the
amount of P30,000.00 as attorney's fee, plus P1,000.00 per hearing;
4. Ordering the defendants, jointly and severally, to pay Plaintiff the
amount of P10,000.00 as acceptance fee, plus P20,000.00 as
litigation expenses;
5. Ordering the defendants, jointly and severally, to pay Plaintiff the
amount of P20,000.00 as exemplary damages;
6. Ordering the defendants, jointly and severally, to pay Plaintiff the
amount of P10,000.00 as moral damages;
7. And granting such other reliefs and remedies just and equitable in
the premises.18
On July 17, 1996, the MTC issued a pre-trial order in Civil Case No.
6089 defining the issue, thus:
Whether or not Unlawful Detainer is proper in the premises
considering the claim of ownership by defendants from the
beginning of these litigations sometime in 1982 followed by this case
at bench. Otherwise stated, is the occupation of the land in dispute by
the defendants by tolerance of plaintiffs. 19
On September 25, 1996, the MTC rendered judgment in Civil Case No.
6089 in favor of Corazon and Angela and ordered the dismissal of the
complaint on the ground of lack of jurisdiction.20 The court held that the issue
between the parties was one of ownership and not merely possession de
facto. Thus, the possession of the property by defendants was not by mere
tolerance, but by virtue of a claim of ownership; in fact, defendants never
recognized the plaintiffs' claim of ownership over the property. In ruling
against Arsenio and his children, the trial court relied on their pleadings, the
decision of the CFI in Civil Case No. 6261, the ruling of the CA in CA-G.R.
CV No. 15455, and the resolution of this Court in UDK-10069.21 It declared
that, although the CA reversed the decision of the CFI in Tarlac, the facts
show that the dispute between the parties constitutes possession de jure; the
action of the spouses Dulay in Civil Case No. 6261 which was an accion
publiciana cannot be converted into one for unlawful detainer in Civil Case
No. 6089.
Arsenio and his children appealed to the RTC. The case was docketed as
Civil Case No. 8396. On June 25, 1997, it reversed the decision of the MTC
and ordered the eviction of defendants, holding that the issue was the
entitlement to the physical possession de facto of the property, an issue
within the exclusive jurisdiction of the MTC;22 in contrast, the issue between
the parties in Civil Case No. 6261 was possession de jure and not
possession de facto. The RTC further declared that the spouses Dulay had a
torrens title over the property which was conclusive against the whole world;
as such, they were entitled to the possession of the property as owners
thereof. Citing the ruling of this Court in Peran v. Espera,23 the RTC ruled
that Corazon and Angela possessed the property for a considerable length of
time only through mere tolerance of plaintiffs.
Corazon and Angela moved to reconsider the decision, which the RTC denied
in an Order24 dated September 22, 1997. They filed a petition for review in
the CA, praying that the RTC decision be reversed and the decision of the
MTC be affirmed. Angela claimed that she owned one-half of the property as
co-owner of the spouses Dulay. The case was docketed as CA-G.R. SP No.
45560.
33
On March 16, 1998, the CA rendered judgment in CA-G.R. SP No. 45560
affirming the decision of the RTC and dismissing the petition. The CA ruled
that, contrary to the claim of Angela, there was no trust created over one-half
of the property in her favor. Since the complaint against Angela and Corazon
in the MTC was one for unlawful detainer, the MTC had exclusive
jurisdiction over the case. Moreover, they had been in possession of the
property by tolerance. In any case, their action was barred by prescription
and laches.
Angela and Corazon filed a motion for reconsideration, which the CA denied.
Angela and Corazon, now petitioners, filed the instant petition for review on
certiorari, claiming that the CA erred as follows:
I. THE HON. COURT OF APPEALS, WITH DUE RESPECT,
ERRED IN CONSIDERING THAT THE CASE AT BAR IS
ONE OF UNLAWFUL DETAINER, WHEN IT IS ONE OF
RECOVERY OF OWNERSHIP AND POSSESSION.
II. THE HON. COURT OF APPEALS, WITH DUE RESPECT,
ERRED IN CONSIDERING THAT THERE WAS NO
TRUST CREATED BY AGREEMENT OF THE PARTIES.
III. THE HON. COURT OF APPEALS, WITH DUE RESPECT,
ERRED IN CONSIDERING THAT THE PETITIONERS'
CLAIM HAS BEEN BARRED BY PRESCRIPTION OR
LACHES.
IV. THE HON. COURT OF APPEALS, WITH DUE RESPECT,
ERRED IN AWARDING ATTORNEY'S FEE FOR
RESPONDENTS.25
According to petitioners, during the pre-trial in the MTC, the parties
stipulated on the following issues to be resolved by the court: whether or not
the action for unlawful detainer of respondents was proper considering that
petitioners claimed ownership over the property in their answer to the
complaint; and whether petitioners possessed the property by mere tolerance
of respondents. Petitioners insist that during the pre-trial conference,
respondents admitted that they had filed a complaint for recovery of
possession of property against petitioners in the CFI of Tarlac, docketed as
Civil Case No. 6261.
Petitioners maintain that the principal issue is one of ownership over the
property and not merely whether or not respondents, as plaintiffs, were
entitled to possession de facto as the registered owners thereof; hence, the
MTC had no jurisdiction over the action of respondents.
Petitioners are of the view that the trial court and the CA erred in declaring
that there was no trust created over the property. They maintain that there
was a verbal agreement between Gideon and his sister Asuncion that the
property would be purchased by them; that the purchase price thereof would
be advanced by Asuncion; that Asuncion would be indicated as the vendee in
the deed of absolute sale to enable her to secure a GSIS loan to pay for the
property, with the concomitant agreement that Gideon would pay one-half of
the purchase price for the property; and that the property will be titled in their
name as trustees for the spouses Gideon and Angela dela Rosa over one-half
portion of the lots. They insist that they are not barred from assailing the
deed of absolute sale executed in favor of the spouses Dulay by the spouses
Rivera. There is likewise no factual and legal basis for the award of attorney's
fees.
In their comment on the petition, respondents aver that the stay of petitioners
in the property after 1982 was by mere tolerance. The MTC had exclusive
jurisdiction over their action because it was filed within one year from
petitioners' last demand to vacate the property. The CA correctly ruled that no
trust was created over the property, with petitioners as trustors and
respondents as trustees; whether a trust agreement was created is a question
of fact which cannot be raised in this Court in a petition for review
on certiorari.
In any event, petitioners' claim of a constructive trust was barred by
prescription since more than ten years had elapsed from the time the titles
over the properties in favor of respondents were issued on September 16,
1957.
Respondents further point out that the MTC of Tarlac rendered judgment in
Civil Case No. 6154 dismissing the complaint on the ground of prescription
or laches; on April 6, 2000, the RTC affirmed the decision on appeal; the CA
affirmed the decision in CA-G.R. SP No. 58857 on February 14, 2002; and
on January 22, 2003, this Court denied petitioners' petition for review of the
decision of the CA in G.R. No. 155599.26 Thus, the fact that no constructive
trust existed in favor of petitioners has been laid to rest by the Court.
The Ruling of the Court
34
The threshold issues are: (1) whether the MTC had jurisdiction over the
action of respondents (plaintiffs therein); (2) whether the CA erred in
declaring that there was no trust relationship between petitioners as trustors
and respondents as trustees; (3) whether the appellate court erred in ruling
that the action of petitioners to enforce the trust against respondents had
prescribed; and (4) whether respondents are entitled to attorney's fees.
On the first issue, we agree with the decision of the CA that the action of
respondents against petitioners was one for unlawful detainer, and that the
MTC had jurisdiction over the same. Indeed, petitioners claimed ownership
over one-half of the property in their answer to the complaint and alleged that
respondents were merely trustees thereof for their benefit as trustors; and,
during the pre-trial, respondents admitted having filed their complaint for
recovery of possession of real property (accion publiciana) against
petitioners before the CFI of Tarlac, docketed as Civil Case No. 6261.
However, these did not divest the MTC of its inceptial jurisdiction over the
complaint for unlawful detainer of respondents.
It is settled jurisprudence that what determines the nature of an action as well
as which court or body has jurisdiction over it are the allegations of the
complaint and the character of the relief sought, whether or not plaintiff is
entitled to any and all of the reliefs prayed for.27 The jurisdiction of the court
or tribunal over the nature of the action cannot be made to depend upon the
defenses set up in the court or upon a motion to dismiss, for otherwise, the
question of jurisdiction would depend almost entirely on defendant. Once
jurisdiction is vested, the same is retained up to the end of the litigation. 28
Jurisdiction cannot be conferred by the voluntary act or agreement of the
parties; it cannot be acquired through or waived, enlarged or diminished by
their act or omission. Neither is it conferred by the acquiescence of the court.
It is neither for the court nor the parties to violate or disregard the rule, this
matter being legislative in character. Thus, the jurisdiction over the nature of
an action and the subject matter thereof is not affected by the theories set up
by defendant in an answer or motion to dismiss. 29
Section 3 of Republic Act No. 7691, amending Section 33(2) of Batas
Pambansa Blg. 129, which was the law in effect when respondents filed their
complaint against petitioners, provides that "Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit Trial Courts exercise exclusive
original jurisdiction over cases of forcible entry and unlawful detainer;
provided that, when, in such cases, defendant raises the questions of
ownership in his pleadings and the question of possession cannot be resolved
without deciding the issue of ownership, the issue of ownership shall be
resolved only to determine the issues of possession."
As gleaned from the averments of the complaint, respondents, as plaintiffs
below, alleged that they were the owners of parcels of land covered by TCT
Nos. 29040 and 29041, hence, entitled to the possession of the property;
petitioners (defendants therein) and their predecessors-in-interest had
occupied the said parcels of land since 1957 without paying any rent; their
possession over the property continued even after the spouses Dulay
purchased the property; and that their occupation of the property was by mere
tolerance of the spouses Dulay and, after Asuncion died on June 26, 1995, by
respondents; petitioners promised to vacate the premises when respondents
needed the property; demands were made by respondents on October 2, 1995
for petitioners to vacate the property but the latter refused, prompting an
action to be filed in the Office of the Pangkat; and, on December 1, 1995,
the Pangkat Secretary issued a certification to file action. As gleaned from
the petitory portion of the complaint, respondents likewise prayed for the
eviction of petitioners from the property with a plea for judgment for
reasonable compensation for petitioners' occupation of the premises.
Respondents filed their complaint on January 29, 1996 in the MTC, within
the period of one year from the final demand made against petitioners to
vacate the property.
It is true that during the pre-trial, the MTC issued an order defining the issue
to be litigated by the parties whether or not unlawful detainer is proper in
the premises considering defendants' claim of ownership from 1982;
otherwise stated, whether petitioners' occupation of the land in dispute was
by mere tolerance of respondents. As framed by the MTC, the issue before it
was basically one of physical or material possession of the property, although
petitioners raised ownership as an issue. Thus, the MTC erred when it
declared that, since defendants claimed ownership over the property, it was
divested of its jurisdiction to take cognizance of and decide the case on its
merits.
It bears stressing that in unlawful detainer cases, the only issue for resolution,
independent of any claim of ownership by any party litigant, is: who is
entitled to the physical and material possession of the property involved? The
mere fact that defendant raises the defense of ownership of the property in
the pleadings does not deprive the MTC of its jurisdiction to take cognizance
of and decide the case. In cases where defendant raises the question of
ownership in the pleadings and the question of possession cannot be resolved
without deciding the issue of ownership, the court may proceed and resolve
35
the issue of ownership but only for the purpose of determining the issue of
possession. However, the disposition of the issue of ownership is not final, as
it may be the subject of separate proceeding specifically brought to settle the
issue. Hence, the bare fact that petitioners, in their answer to the complaint,
raised the issue of whether they owned the property as trustors of a
constructive trust (with the spouses Dulay as the trustees), did not divest the
MTC of its jurisdiction to take cognizance of the case and decide the same on
its merits.30
Petitioners were well aware that the issue of ownership over the property had
to be resolved in a proper action for the purpose, separate from and
independent of Civil Case No. 6089 in the MTC of Tarlac. It is for this reason
that petitioner Angela filed a complaint for recovery of ownership,
reconveyance, cancellation of title and damages against respondents,
docketed as Civil Case No. 6154, wherein she prayed that respondents, as
defendants, be ordered to convey to her one-half portion of the property.
However, her claim was rejected by the trial court, which ordered the
complaint dismissed; the RTC likewise dismissed the case on appeal. In
affirming this dismissal in CA-G.R. SP No. 58857 promulgated on February
14, 2002, the CA ratiocinated as follows:
Nevertheless, notwithstanding the foregoing, this Court finds that
petitioner's complaint should be dismissed. This is so because
petitioner miserably failed to establish her claim to the property. It
must be stressed that while an implied trust may be established by
parol evidence, such evidence must be as fully convincing as if the
acts giving rise to the trust obligation are proven by an authentic
document. (Heirs of Lorenzo Yap v. Court of Appeals, 312 SCRA 603
[1999], at page 609). An implied trust cannot be made to rest on
vague and inconclusive proof. (Ibid.)
Unfortunately for petitioner, the evidence she presented in her
attempt to establish their so-called trust agreement is not sufficient or
convincing. The list of dates and amounts written by her purportedly
showing payments made to the late Asuncion dela Rosa Dulay
cannot even be given credence as appreciation of such list can be
equivocal (see Exhibit "H," page 152, Original Records). The list
was made in petitioner's handwriting and there was no counter-
signature made by Dulay showing acknowledgment of such listing.
At best, the list can merely be appreciated as it is, a list, but
definitely, it does not prove payments made on the purchase price of
the portion of the property.
Also, the Court notes the NBI's Questioned Documents Report No.
316-884 (dated Nov. 14, 1984) finding that the signature of Asuncion
Dulay in the receipt allegedly acknowledging partial payment in the
amount of P500.00 was signed over a typewritten carbon or duplicate
impression which is not part of the main entries in the receipt (see
Exhibit "7," page 154, Original Records). Such conclusion shows
that the entries made on the receipt were not written on a single
occasion but rather separately executed. Thus, the Court cannot give
any evidentiary value on said receipt considering that its credibility is
suspect.
Meanwhile, private respondents have in their favor TCT Nos. 29040
and 29041 in the name of the spouses Arsenio Dulay and Asuncion
dela Rosa (see Exhibits "1" and "2," pages 181-182, Original
Records); the Deed of Absolute Sale executed in 1957 by the spouses
Adriano Rivera and Aurora Mercado (petitioner's paternal
grandparents) conveying the entire property to the spouses Dulay for
the price of P7,000 (see Exhibit "3," page 148, Original Records); the
tax declaration receipts showing tax payments made by private
respondents on the property (see Exhibits "3" to "3-b," pages 183-
185, Original Records); and the tax declaration of real property for
the year 1974 in the name of the spouses Dulay (see Exhibit "C" to
"C-1," pages 150-151, Original Records).
All told, petitioner failed to discharge that onus incumbent upon her
to prove her claim over the property.31
Angela assailed the decision of the CA in this Court in G.R. No. 155599, and
this Court resolved to deny the petition as follows:
G.R. No. 155599 (Angela dela Rosa v. Orfelina Roldan, et al.).
Considering the allegations, issues, and arguments adduced in the
petition for review on certiorari of the decision and resolution of the
Court of Appeals dated February 14, 2002 and October 14, 2002,
respectively, the Court Resolves to DENY the petition for failure of
the petitioner to sufficiently show that the Court of Appeals
committed any reversible error in the challenged decision and
resolution as to warrant the exercise by this Court of its discretionary
appellate jurisdiction in this case.32
The resolution of the Court became final and executory on May 20,
2003.33 Thus, the issue of whether or not respondents were trustees of one-
36
half of the property had been finally resolved by this Court in favor of
respondents; in fine, the validity of TCT Nos. 29040 and 29041 in the names
of the spouses Dulay had been affirmed by the trial court, the MTC, the CA
and this Court. The claim of co-ownership of petitioner Angela and
possession over the western portion of the property thus have no factual and
legal basis.
We agree with petitioners that the complaint of the spouses Dulay filed in
1982 docketed as Civil Case No. 6261 was one for recovery of possession of
the property (accion publiciana) and that they likewise later filed a complaint
with the MTC, on January 29, 1996, for unlawful detainer in Civil Case No.
6089 instead of an accion publiciana. However, respondents were not
proscribed from filing a complaint for unlawful detainer five (5) or six (6)
years from the dismissal of their complaint for recovery of possession of real
property. The dismissal of respondents' complaint in Civil Case No. 6261 by
the CA was not based on the merits of the case, but solely because it was
premature on account of the failure to allege that earnest efforts were made
for the amicable settlement of the cases as required by Article 222 of the New
Civil Code. The dismissal of the complaint was thus without prejudice. 34
It bears stressing that, after the Court declared in UDK-10069 on November
19, 1990 that the decision of the CA in CA-G.R. CV No. 15455 was final and
executory, respondents did not immediately file their complaint for unlawful
detainer against petitioners for their eviction. Respondents filed their
complaint only on January 29, 1996, or after the lapse of almost six (6) years,
but barely four (4) months after respondents' final demand to vacate the
property on October 2, 1995 and the issuance of the certification of
the Pangkat Secretary on December 1, 1995.
We agree with the contention of petitioners that for an action for unlawful
detainer based on possession by mere tolerance to prosper, the possession of
the property by defendant must be legal from the very beginning. 35 In this
case, petitioners' possession of the property was tolerated by the former
owners, the spouses Rivera, and by the spouses Dulay after they purchased
the property. After all, Angela was the granddaughter of Consolacion Rivera,
the sister of Adriano Rivera, and Gideon was the brother of Asuncion.
However, when the spouses Dulay needed the property for their children's
use and requested petitioners to vacate the property, the latter refused. From
then on, petitioners' possession of the property became deforciant. A person
who occupies the land of another on the latter's tolerance, without any
contract between them, is necessarily barred by an implied provision that he
will vacate the same upon demand.36 Respondents thus had the option to file
a complaint for unlawful detainer within one year therefrom, or an accion
publiciana beyond the one-year period from the demand of respondents as
plaintiffs for petitioners to vacate the property.
The Court notes that the property was sold to respondents, and that it was
titled in their names (TCT Nos. 29040 and 29041). The said deed and titles
support the right of respondents to the material possession of the
property.37 Under all the circumstances and facts in this case, petitioners'
claim, that they had the right to the material possession of the property, has
no factual and legal basis. We quote with approval the decision of the CA in
CA-G.R. SP No. 45560:
Private respondents are entitled to its possession from the time title
was issued in their favor as registered owners. "An action for
unlawful detainer may be filed when possession by a landlord,
vendor, vendee or other person against whom the possession of any
land or building is unlawfully withheld after the expiration or
termination of their right to hold possession, by virtue of a contract,
express or implied."
Second. "The age-old rule is that 'the person who has a torrens title
over a land is entitled to possession thereof'." Except for the claim
that the title of private respondents is not conclusive proof of
ownership, petitioners have shown no right to justify their continued
possession of the subject premises.38
On the issue of whether the RTC acted in excess of its appellate jurisdiction
in awarding P50,000.00 as attorney's fees in favor of respondents, petitioners
aver that under the Rules on Summary Procedure, respondents are entitled to
a maximum amount of only P20,000.00; hence, the RTC acted in excess of
its jurisdiction when it awarded P50,000.00 as attorney's fees, as it is in
excess of the maximum amount under the said Rules. Besides, petitioners
aver, the amount of P50,000.00 is unjust and inequitable. Moreover, the RTC
ordered petitioners to pay attorney's fees of P50,000.00 without even
supporting the award with its finding and citing legal provisions or case law.
For its part, the CA ruled that the award of P50,000.00 as attorney's fees
under the Rules on Summary Procedure does not apply in a case where the
decision of the MTC is appealed to the RTC. The latter court may award an
amount beyond the maximum amount of P20,000.00 under the Rules on
Summary Procedure as attorney's fees for the reason that, on appeal in the
RTC, the regular rules of civil procedure apply. According to the CA, there
37
was factual and legal basis for the award of P50,000.00 as respondents'
attorney's fees:
Second. Decisional law states
"There is no question that a court may, whenever it deems
just and equitable, allow the recovery by the prevailing party
of attorney's fees. In determining the reasonableness of such
fees, this Court in a number of cases has provided various
criteria which, for convenient guidance, we might collate,
thusly: a) the quantity and character of the services rendered;
b) the labor, time and trouble involved; c) the nature and
importance of the litigation; d) the amount of money or the
value of the property affected by the controversy; e) the
novelty and difficulty of questions involved; f) the
responsibility imposed on counsel; g) the skill and
experience called for in the performance of the service; h)
the professional character and social standing of the lawyer;
i) the customary charges of the bar for similar services; j) the
character of employment, whether casual or for established
client; k) whether the fee is absolute or contingent (it being
the rule that an attorney may properly charge a higher fee
when it is contingent than when it is absolute; and l) the
results secured."
In view thereof, the award of attorney's fees is justified. That is, in
addition to the provisions of Article 2208 of the New Civil Code
which reads
"In the absence of stipulation, attorney's fees and expenses of
litigation, other than judicial costs, cannot be recovered,
except:
xxxx
(2) When the defendant's act or omission has compelled the
plaintiff to litigate with third persons or to incur expenses to
protect his interest;"
xxxx
considering that petitioners refused to vacate the subject premises
despite demands by the private respondents.
Finally, the Supreme Court has explained
"The Rule on Summary Procedure applies only in cases filed
before the Metropolitan Trial Court and Municipal Trial
Courts pursuant to Section 36 of Batas Pambansa Blg. 129. x
x x Hence, when the respondents appealed the decision of
the Municipal Trial Court to the Regional Trial Court, the
applicable rules are those of the latter court."
Thus, the award of the amount of fifty thousand pesos (P50,000.00)
as attorney's fees is justified considering that the jurisdictional
amount of twenty thousand pesos (P20,000.00) under Section 1,
paragraph (A), subparagraph (1) of the Revised Rule on Summary
Procedure applies only to the Metropolitan Trial Courts, Municipal
Trial Courts in Cities, Municipal Trial Courts and Municipal Circuit
Trial Courts.39
We agree with the ruling of the CA. The ceiling of P20,000.00 applies only in
the MTC where the Rules on Summary Procedure are applied. On appeal to
the RTC, the RTC may affirm, modify or even reverse the decision of the
MTC; as such, the RTC may increase the award for attorney's fees in excess
of P20,000.00 if there is factual basis therefor.
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. Costs
against the petitioners.
Footnotes
34 Section 5, Rule 16 of the Revised Rules of Court.
38
16. CJH DEVELOPMENT CORPORATION v. BUREAU OF INTERNAL
REVENUE, BUREAU OF CUSTOMS, and DISTRICT COLLECTOR
OF CUSTOMS EDWARD O. BALTAZAR
G.R. No. 172457 December 24, 2008
Republic Act No. 9282

Before us is a petition for review on certiorari 1 seeking the reversal of the

orders dated 14 October 20052 and 04 April 20063 of the Regional Trial Court
(RTC) of Baguio City, Branch 5. The RTC dismissed the petition for
declaratory relief filed by petitioner CJH Development Corporation (CJH).
This petition was brought directly to this Court since it involves a pure
question of law in accordance with Rule 50 of the 1997 Revised Rules of
Court.

Proclamation No. 420 (the Proclamation) was issued by then President Fidel
V. Ramos to create a Special Economic Zone (SEZ) in a portion of Camp
John Hay in Baguio City. Section 34 of the Proclamation granted to the newly
created SEZ the same incentives then already enjoyed by the Subic SEZ.
Among these incentives are the exemption from the payment of taxes, both
local and national, for businesses located inside the SEZ, and the operation of
the SEZ as a special customs territory providing for tax and duty free
importations of raw materials, capital and equipment. 5

In line with the Proclamation, the Bureau of Internal Revenue (BIR) issued
Revenue Regulations No. 12-976 while the Bureau of Customs (BOC) issued
Customs Administrative Order No. 2-98.7 The two issuances provided the
rules and regulations to be implemented within the Camp John Hay SEZ.
Subsequently, however, Section 3 of

39
the Proclamation was declared unconstitutional in part by the Court en
banc in John Hay Peoples Alternative Coalition v. Lim, 8 when it ruled that:
WHEREORE, the second sentence of Section 3 of Proclamation No.
420 is hereby declared NULL and VOID and is accordingly declared
of no legal force and effect. Public respondents are hereby enjoined
from implementing the aforesaid void provision.
Proclamation No. 420, without the invalidated portion, remains valid
and effective.9
The decision attained finality when the Court en banc denied the motion for
reconsideration through a resolution dated 29 March 2005. 10
While the motion for reconsideration was pending with the Court, on 16
January 2004 the Office of the City Treasurer of Baguio sent a demand
letter11 which stated that:
In view of the Supreme Court decision dated October 24, 2003 on
G.R. No. 119775, declaring null and void Section 3 of Proclamation
420 on applicable incentives of Special Economic Zones, we are
sending you updated statements of real property taxes due on real
estate properties declared under the names of the Bases Conversion
and Development Authority and Camp John Hay Development
Corporation totalingP101,935,634.17 inclusive of penalties, as of
January 10, 2004.
May we request for the immediate settlement of the above
indebtedness, otherwise this office shall be constrained to hold the
processing of your business permit pursuant to Section 2 C c.1 of Tax
Ordinance 2000-001 of Baguio City.
Five months later, on 26 May 2005, the BOC followed suit and
demanded12 of CJH the payment ofP71,983,753.00 representing the duties
and taxes due on all the importations made by CJH from 1998 to 2004. For
its part, the BIR sent a letter dated 23 May 2005 to CJH wherein it treated
CJH as an ordinary corporation subject to the regular corporate income tax as
well as to the Value Added Tax of 1997.13
CJH questioned the retroactive application by the BOC of the decision of this
Court in G.R. No. 119775. It claimed that the assessment was null and void
because it violated the non-retroactive principle under the Tariff and Customs
Code.14
The Office of the Solicitor General (OSG) filed a motion to dismiss. 15 The
OSG claimed that the remedy of declaratory relief is inapplicable because an
assessment is not a proper subject of such petition. It further alleged that
there are administrative remedies which were available to CJH.
In an Order16 dated 28 June 2005, the RTC dropped the City of Baguio as a
party to the case. The remaining parties were required to submit their
respective memoranda. On 14 October 2005, the RTC rendered its assailed
order.17 It held that the decision in G.R. No. 119775 applies retroactively
because the tax exemption granted by Proclamation No. 420 is null and void
from the beginning. The RTC also ruled that the petition for declaratory relief
is not the appropriate remedy. A judgment of the court cannot be the proper
subject of a petition for declaratory relief; the enumeration in Rule 64 is
exclusive. Moreover, the RTC held that Commonwealth Act No. 55 (CA No.
55) which proscribes the use of declaratory relief in cases where a taxpayer
questions his tax liability is still in force and effect.
CJH filed a motion for reconsideration but the RTC denied it. 18 Hence this
petition, which, as earlier stated, was filed directly to this Court, raising as it
does only pure questions of law.
There are two issues raised in this petition, one procedural and the other
substantive. First, is the remedy of declaratory relief proper in this case?
Second, can the decision in G.R. No. 119775 be applied retroactively?
The requisites for a petition for declaratory relief to prosper are: (1) there
must be a justiciable controversy; (2) the controversy must be between
persons whose interests are adverse; (3) the party seeking declaratory relief
must have a legal interest in the controversy; and (4) the issue involved must
be ripe for judicial determination.19
CJH alleges that CA No. 5520 has already been repealed by the Rules of
Court; thus, the remedy of declaratory relief against the assessment made by
the BOC is proper. It cited the commentaries of Moran allegedly to the effect
that declaratory relief lies against assessments made by the BIR and BOC.
Yet in National Dental Supply Co. v. Meer,21 this Court held that:
40
 From the opinion of the former Chief Justice Moran may be deduced
that the failure to incorporate the above proviso [CA No. 55] in
section 1, rule 66, [now Rule 64] is not due to an intention to repeal
it but rather to the desire to leave its application to the sound
discretion of the court, which is the sole arbiter to determine whether
a case is meritorious or not. And even if it be desired to incorporate it
in rule 66, it is doubted if it could be done under the rule-making
power of the Supreme Court considering that the nature of said
proviso is substantive and not adjective, its purpose being to lay
down a policy as to the right of a taxpayer to contest the collection of
taxes on the part of a revenue officer or of the Government. With the
adoption of said proviso, our law-making body has asserted its policy
on the matter, which is to prohibit a taxpayer to question his liability
for the payment of any tax that may be collected by the Bureau of
Internal Revenue. As this Court well said, quoting from several
American cases, "The Government may fix the conditions upon
which it will consent to litigate the validity of its original taxes..."
"The power of taxation being legislative, all incidents are within the
control of the Legislature." In other words, it is our considered
opinion that the proviso contained in Commonwealth Act No. 55 is
still in full force and effect and bars the plaintiff from filing the
present action.22 (Emphasis supplied) (Citations omitted.)
As a substantive law that has not been repealed by another statute, CA No. 55
is still in effect and holds sway. Precisely, it has removed from the courts
jurisdiction over petitions for declaratory relief involving tax assessments.
The Court cannot repeal, modify or alter an act of the Legislature.
Moreover, the proper subject matter of a declaratory relief is a deed, will,
contract, or other written instrument, or the construction or validity of statute
or ordinance.23 CJH hinges its petition on the demand letter or assessment
sent to it by the BOC. However, it is really not the demand letter which is the
subject matter of the petition. Ultimately, this Court is asked to determine
whether the decision of the Court en banc in G.R. No. 119775 has a
retroactive effect. This approach cannot be countenanced. A petition for
declaratory relief cannot properly have a court decision as its subject matter.
In Tanda v. Aldaya,24 we ruled that:
x x x [A] court decision cannot be interpreted as included within the
purview of the words "other written instrument," as contended by
appellant, for the simple reason that the Rules of Court already
provide[s] for the ways by which an ambiguous or doubtful decision
may be corrected or clarified without need of resorting to the
expedient prescribed by Rule 66 [now Rule 64].25
There are other remedies available to a party who is not agreeable to a
decision whether it be a question of law or fact. If it involves a decision of an
appellate court, the party may file a motion for reconsideration or new trial in
order that the defect may be corrected. 26 In case of ambiguity of the decision,
a party may file a motion for a clarificatory judgment. 27 One of the requisites
of a declaratory relief is that the issue must be ripe for judicial determination.
This means that litigation is inevitable28 or there is no adequate relief
available in any other form or proceeding.29
However, CJH is not left without recourse. The Tariff and Customs Code
(TCC) provides for the administrative and judicial remedies available to a
taxpayer who is minded to contest an assessment, subject of course to certain
reglementary periods. The TCC provides that a protest can be raised provided
that payment first be made of the amount due.30 The decision of the Collector
can be reviewed by the Commissioner of Customs who can approve, modify
or reverse the
decision or action of the Collector.31 If the party is not satisfied with the
ruling of the Commissioner, he may file the necessary appeal to the Court of
Tax Appeals.32 Afterwards, the decision of the Court of Tax Appeals can be
appealed to this Court.
With the foregoing disquisition on the first issue, there is no need to delve
into the second issue at this juncture. It should be noted though, as admitted
by CJH in its Certificate of Non-Forum Shopping,33 that even before the
filing of this petition, it already had a pending petition for review with this
Court, docketed as G.R. No. 16923434and entitled, Camp John Hay
Development Corporation v. Central Board of Assessment Appeals, et
al. That case emanated from assessments made in 2002 for real estate taxes
on CJH by the City of Baguio. Said assessments were duly challenged before
the Local Board of Assessment Appeals, the Central Board of Assessment
Appeals and the Court of Tax Appeals. The petition in G.R. No. 169234 was
filed with this Court in September 2005, or after our 2003 Decision in John
Hay Peoples Alternative Coalition had attained finality. CJH therein raised
the same question of law, as in this case, whether the doctrine of operative
fact applies to G.R. No. 119775. Clearly, the Court in G.R. No. 169234 is
better positioned to resolve that question of law, there being no antecedent
jurisdictional defects that would preclude the Court from squarely deciding
41
that particular issue. CJH is free to reiterate this current point of clarification
as it litigates the petition in G.R. No. 169234.
WHEREFORE, the Petition is DENIED.
Footnotes
4
Entitled, "CREATING AND DESIGNATING A PORTION OF THE AREA
COVERED BY THE FORMER CAMP JOHN AS THE JOHN HAY
SPECIAL ECONOMIC ZONE PURSUANT TO REPUBLIC ACT NO.
7227. Sec. 3. Investment Climate in John Hay Economic Zone.Pursuant to
Section 5(m) and Section 15 of Republic Act No. 7227, the John Hay Poro
Point Development Corporation shall implement all necessary policies, rules,
and regulations governing the zone, including investment incentives, in
consultation with pertinent government departments. Among others, the zone
shall have all the applicable incentives of the Special Economic Zone under
Section 12 of Republic Act No. 7227 and those applicable incentives granted
in the Export Processing Zones, the Omnibus Investment Code of 1987, the
Foreign Investment Act of 1991, and new investment laws that may
hereinafter be enacted.
5
Sec. 12. Republic Act. No. 7227 (1992), Sec. 12.
20
CA No. 55 amended Section 1 of Act No. 3736 the proviso is as follows:
Sec. 1. Construction.Any person interested under a deed, contract or
other written instrument, or whose rights are affected by a statute, may
bring an action in a Court of First Instance to determine any question
of construction or validity arising under such deed, contract,
instrument or statute and for a declaration of his rights or duties
thereunder: Provided, however, That the provisions of this Act shall
not apply to cases where a taxpayer questions his liability for the
payment of any tax, duty, or charge collectible under any law
administered by the Bureau of Customs or the Bureau of Internal
Revenue.
30
Section 2308. Protest and Payment upon Protest in Civil Matters.When a
ruling or decision of the Collector is made whereby liability for duties, fees,
or other money charge is determined, except the fixing of fines in seizure
cases, the party adversely affected may protest such ruling or decision by
presenting to the Collector at the time when payment of the amount claimed
to be due the Government is made, or within thirty days thereafter, a written
protest setting forth his objections to the ruling or decision in question,
together with the reasons therefor. No protest shall be considered unless
payment of the amount due after final liquidation has first been made.
31
Section 2313. Review by Commissioner.The person aggrieved by the
decision or action f the Collector in any matter presented upon protest or by
his action in any case of seizure may, within fifteen days after notification in
writing by the Collector of his action or decision, give written notice to the
Collector of his desire to have the matter reviewed by the Commissioner.
Thereupon the Collector shall forthwith transmit all the records of the
proceedings to the Commissioner, who shall approve, modify or reverse the
action or decision of the Collector and take such steps and make such orders
as may be necessary to give effect to his decision.
32
Section 2402. Review by Court of Tax AppealsThe party aggrieved by a
ruling of the Commissioner in any matter brought before him upon protest or
by his action or ruling in any case of seizure may appeal to the Court of Tax
Appeals, in the manner and within the period prescribed by law and
regulations.
Unless an appeal is made to the Court of Tax Appeals in the manner and
within the period prescribed by laws and regulations, the action or ruling of
the Commissioner shall be final and conclusive.
17. LUCAS G. ADAMSON, THERESE JUNE D. ADAMSON, and SARA S.
DE LOS REYES, in their capacities as President, Treasurer and
Secretary of Adamson Management Corporation v. COURT OF
42
APPEALS and LIWAYWAY VINZONS-CHATO, in her capacity as
Commissioner of the Bureau of Internal Revenue.
G.R. No. 120935 May 21, 2009
x - - - - - - - - - - - - - - - - - - - - - - -x
INTERNAL REVENUE v. COMMISSIONER OF COURT OF
APPEALS, COURT OF TAX APPEALS, ADAMSON MANAGEMENT
CORPORATION, LUCAS G. ADAMSON, THERESE JUNE D.
ADAMSON, and SARA S. DE LOS REYES
G.R. No. 124557 May 21, 2009
Republic Act No. 9282
Before the Court are the consolidated cases of G.R. No. 120935 and G.R. No.
124557.
G.R. No. 120935 involves a petition for review on certiorari filed by
petitioners LUCAS G. ADAMSON, THERESE JUNE D. ADAMSON, and
SARA S. DE LOS REYES (private respondents), in their respective
capacities as president, treasurer and secretary of Adamson Management
Corporation (AMC) against then Commissioner of Internal Revenue
Liwayway Vinzons-Chato (COMMISSIONER), under Rule 45 of the
Revised Rules of Court. They seek to review and reverse the Decision
promulgated on March 21, 1995 and Resolution issued on July 6, 1995 of the
Court of Appeals in CA-G.R. SP No. 35488 (Liwayway Vinzons-Chato, et al.
v. Hon. Judge Erna Falloran-Aliposa, et al.).
G.R. No. 124557 is a petition for review on certiorari filed by the
Commissioner, assailing the Decision dated March 29, 1996 of the Court of
Appeals in CA-G.R. SP No. 35520, titled Commissioner of Internal Revenue
v. Court of Tax Appeals, Adamson Management Corporation, Lucas G.
Adamson, Therese June D. Adamson and Sara S. de los Reyes. In the said
Decision, the Court of Appeals upheld the Resolution promulgated on
September 19, 1994 by the Court of Tax Appeals (CTA) in C.T.A. Case No.
5075 (Adamson Management Corporation, Lucas G. Adamson, Therese
Adamson and Sara de los Reyes v. Commissioner of Internal Revenue).
The facts, as culled from the findings of the appellate court, follow:
On June 20, 1990, Lucas Adamson and AMC sold 131,897 common shares
of stock in Adamson and Adamson, Inc. (AAI) to APAC Holding Limited
(APAC). The shares were valued at P7,789,995.00.1 On June 22,
1990,P159,363.21 was paid as capital gains tax for the transaction.
On October 12, 1990, AMC sold to APAC Philippines, Inc. another 229,870
common shares of stock in AAI forP17,718,360.00. AMC paid the capital
gains tax of P352,242.96.
On October 15, 1993, the Commissioner issued a "Notice of Taxpayer" to
AMC, Lucas G. Adamson, Therese June D. Adamson and Sara S. de los
Reyes, informing them of deficiencies on their payment of capital gains tax
and Value Added Tax (VAT). The notice contained a schedule for preliminary
conference.
The events preceding G.R. No. 120935 are the following:
On October 22, 1993, the Commissioner filed with the Department of Justice
(DOJ) her Affidavit of Complaint2against AMC, Lucas G. Adamson, Therese
June D. Adamson and Sara S. de los Reyes for violation of Sections 45 (a)
and (d)3 , and 1104 , in relation to Section 1005 , as penalized under Section
255,6 and for violation of Section 2537 , in relation to Section 252 (b) and (d)
of the National Internal Revenue Code (NIRC).8
AMC, Lucas G. Adamson, Therese June D. Adamson and Sara S. de los
Reyes filed with the DOJ a motion to suspend proceedings on the ground of
prejudicial question, pendency of a civil case with the Supreme Court, and
pendency of their letter-request for re-investigation with the Commissioner.
After the preliminary investigation, State Prosecutor Alfredo P. Agcaoili
found probable cause. The Motion for Reconsideration against the findings
of probable cause was denied by the prosecutor.
On April 29, 1994, Lucas G. Adamson, Therese June D. Adamson and Sara
S. de los Reyes were charged before the Regional Trial Court (RTC) of
Makati, Branch 150 in Criminal Case Nos. 94-1842 to 94-1846. They filed a
Motion to Dismiss or Suspend the Proceedings. They invoked the grounds
that there was yet no final assessment of their tax liability, and there were
still pending relevant Supreme Court and CTA cases. Initially, the trial court
denied the motion. A Motion for Reconsideration was however filed, this
time assailing the trial courts lack of jurisdiction over the nature of the
subject cases. On August 8, 1994, the trial court granted the Motion. It ruled
that the complaints for tax evasion filed by the Commissioner should be
43
regarded as a decision of the Commissioner regarding the tax liabilities of
Lucas G. Adamson, Therese June D. Adamson and Sara S. de los Reyes, and
appealable to the CTA. It further held that the said cases cannot proceed
independently of the assessment case pending before the CTA, which has
jurisdiction to determine the civil and criminal tax liability of the respondents
therein.
On October 10, 1994, the Commissioner filed a Petition for Review with the
Court of Appeals assailing the trial courts dismissal of the criminal cases.
She averred that it was not a condition prerequisite that a formal assessment
should first be given to the private respondents before she may file the
aforesaid criminal complaints against them. She argued that the criminal
complaints for tax evasion may proceed independently from the assessment
cases pending before the CTA.
On March 21, 1995, the Court of Appeals reversed the trial courts decision
and reinstated the criminal complaints. The appellate court held that, in a
criminal prosecution for tax evasion, assessment of tax deficiency is not
required because the offense of tax evasion is complete or consummated
when the offender has knowingly and willfully filed a fraudulent return with
intent to evade the tax.9 It ruled that private respondents filed false and
fraudulent returns with intent to evade taxes, and acting thereupon, petitioner
filed an Affidavit of Complaint with the Department of Justice, without an
accompanying assessment of the tax deficiency of private respondents, in
order to commence criminal action against the latter for tax evasion. 10
Private respondents filed a Motion for Reconsideration, but the trial court
denied the motion on July 6, 1995. Thus, they filed the petition in G.R. No.
120935, raising the following issues:
1. WHETHER OR NOT THE RESPONDENT HONORABLE COURT OF
APPEALS ERRED IN APPLYING THE DOCTRINE IN UNGAB V. CUSI
(Nos. L-41919-24, May 30, 1980, 97 SCRA 877) TO THE CASE AT BAR.
2. WHETHER OR NOT AN ASSESSMENT IS REQUIRED UNDER THE
SECOND CATEGORY OF THE OFFENSE IN SECTION 253 OF THE
NIRC.
3. WHETHER OR NOT THERE WAS A VALID ASSESSMENT MADE BY
THE COMMISSIONER IN THE CASE AT BAR.
4. WHETHER OR NOT THE FILING OF A CRIMINAL COMPLAINT
SERVES AS AN IMPLIED ASSESSMENT ON THE TAX LIABILITY OF
THE TAXPAYER.
5. WHETHER OR NOT THE FILING OF THE CRIMINAL
INFORMATION FOR TAX EVASION IN THE TRIAL COURT IS
PREMATURE BECAUSE THERE IS YET NO BASIS FOR THE
CRIMINAL CHARGE OF WILLFULL INTENT TO EVADE THE
PAYMENT OF A TAX.
6. WHETHER OR NOT THE DOCTRINES LAID DOWN IN THE CASES
OF YABES V. FLOJO (No. L-46954, July 20, 1982, 115 SCRA 286) AND
CIR V. UNION SHIPPING CORP. (G.R. No. 66160, May 21, 1990, 185
SCRA 547) ARE APPLICABLE TO THE CASE AT BAR.
7. WHETHER OR NOT THE COURT OF TAX APPEALS HAS
JURISDICTION OVER THE DISPUTE ON WHAT CONSTITUTES THE
PROPER TAXES DUE FROM THE TAXPAYER.
In parallel circumstances, the following events preceded G.R. No. 124557:
On December 1, 1993, AMC, Lucas G. Adamson, Therese June D. Adamson
and Sara S. de los Reyes filed a letter request for re-investigation with the
Commissioner of the "Examiners Findings" earlier issued by the Bureau of
Internal Revenue (BIR), which pointed out the tax deficiencies.
On March 15, 1994 before the Commissioner could act on their letter-
request, AMC, Lucas G. Adamson, Therese June D. Adamson and Sara S. de
los Reyes filed a Petition for Review with the CTA. They assailed the
Commissioners finding of tax evasion against them. The Commissioner
moved to dismiss the petition, on the ground that it was premature, as she had
not yet issued a formal assessment of the tax liability of therein petitioners.
On September 19, 1994, the CTA denied the Motion to Dismiss. It considered
the criminal complaint filed by the Commissioner with the DOJ as an implied
formal assessment, and the filing of the criminal informations with the RTC
as a denial of petitioners protest regarding the tax deficiency.
The Commissioner repaired to the Court of Appeals on the ground that the
CTA acted with grave abuse of discretion. She contended that, with regard to
the protest provided under Section 229 of the NIRC, there must first be a
formal assessment issued by the Commissioner, and it must be in accord with
44
Section 6 of Revenue Regulation No. 12-85. She maintained that she had not
yet issued a formal assessment of tax liability, and the tax deficiency amounts
mentioned in her criminal complaint with the DOJ were given only to show
the difference between the tax returns filed and the audit findings of the
revenue examiner.
The Court of Appeals sustained the CTAs denial of the Commissioners
Motion to Dismiss. Thus, the Commissioner filed the petition for review
under G.R. No. 124557, raising the following issues:
1. WHETHER OR NOT THE INSTANT PETITION SHOULD BE
DISMISSED FOR FAILURE TO COMPLY WITH THE MANDATORY
REQUIREMENT OF A CERTIFICATION UNDER OATH AGAINST
FORUM SHOPPING;
2. WHETHER OR NOT THE CRIMINAL CASE FOR TAX EVASION IN
THE CASE AT BAR CAN PROCEED WITHOUT AN ASSESSMENT;
3. WHETHER OR NOT THE COMPLAINT FILED WITH THE
DEPARTMENT OF JUSTICE CAN BE CONSTRUED AS AN IMPLIED
ASSESSMENT; and
4. WHETHER OR NOT THE COURT OF TAX APPEALS HAS
JURISDICTION TO ACT ON PRIVATE RESPONDENTS PETITION FOR
REVIEW FILED WITH THE SAID COURT.
The issues in G.R. No. 124557 and G.R. No. 120935 can be compressed into
three:
1. WHETHER THE COMMISSIONER HAS ALREADY RENDERED AN
ASSESSMENT (FORMAL OR OTHERWISE) OF THE TAX LIABILITY
OF AMC, LUCAS G. ADAMSON, THERESE JUNE D. ADAMSON AND
SARA S. DE LOS REYES;
2. WHETHER THERE IS BASIS FOR THE CRIMINAL CASES FOR TAX
EVASION TO PROCEED AGAINST AMC, LUCAS G. ADAMSON,
THERESE JUNE D. ADAMSON AND SARA S. DE LOS REYES; and
3. WHETHER THE COURT OF TAX APPEALS HAS JURISDICTION TO
TAKE COGNIZANCE OF BOTH THE CIVIL AND THE CRIMINAL
ASPECTS OF THE TAX LIABILITY OF AMC, LUCAS G. ADAMSON,
THERESE JUNE D. ADAMSON AND SARA S. DE LOS REYES.
The case of CIR v. Pascor Realty, et al.11 is relevant. In this case, then BIR
Commissioner Jose U. Ong authorized revenue officers to examine the books
of accounts and other accounting records of Pascor Realty and Development
Corporation (PRDC) for 1986, 1987 and 1988. This resulted in a
recommendation for the issuance of an assessment in the amounts
of P7,498,434.65 and P3,015,236.35 for the years 1986 and 1987,
respectively.
On March 1, 1995, the Commissioner filed a criminal complaint before the
DOJ against PRDC, its President Rogelio A. Dio, and its Treasurer Virginia
S. Dio, alleging evasion of taxes in the total amount of P10,513,671.00.
Private respondents filed an Urgent Request for
Reconsideration/Reinvestigation disputing the tax assessment and tax
liability.
The Commissioner denied the urgent request for
reconsideration/reinvestigation because she had not yet issued a formal
assessment.
Private respondents then elevated the Decision of the Commissioner to the
CTA on a petition for review. The Commissioner filed a Motion to Dismiss
the petition on the ground that the CTA has no jurisdiction over the subject
matter of the petition, as there was yet no formal assessment issued against
the petitioners. The CTA denied the said motion to dismiss and ordered the
Commissioner to file an answer within thirty (30) days. The Commissioner
did not file an answer nor did she move to reconsider the resolution. Instead,
the Commissioner filed a petition for review of the CTA decision with the
Court of Appeals. The Court of Appeals upheld the CTA order. However, this
Court reversed the Court of Appeals decision and the CTA order, and ordered
the dismissal of the petition. We held:
An assessment contains not only a computation of tax liabilities, but also a
demand for payment within a prescribed period. It also signals the time when
penalties and interests begin to accrue against the taxpayer. To enable the
taxpayer to determine his remedies thereon, due process requires that it must
be served on and received by the taxpayer. Accordingly, an affidavit, which
was executed by revenue officers stating the tax liabilities of a taxpayer and
attached to a criminal complaint for tax evasion, cannot be deemed an
assessment that can be questioned before the Court of Tax Appeals.
45
Neither the NIRC nor the revenue regulations governing the protest of
assessments12 provide a specific definition or form of an assessment.
However, the NIRC defines the specific functions and effects of an
assessment. To consider the affidavit attached to the Complaint as a proper
assessment is to subvert the nature of an assessment and to set a bad
precedent that will prejudice innocent taxpayers.
True, as pointed out by the private respondents, an assessment informs the
taxpayer that he or she has tax liabilities. But not all documents coming from
the BIR containing a computation of the tax liability can be deemed
assessments.
To start with, an assessment must be sent to and received by a taxpayer, and
must demand payment of the taxes described therein within a specific period.
Thus, the NIRC imposes a 25 percent penalty, in addition to the tax due, in
case the taxpayer fails to pay the deficiency tax within the time prescribed for
its payment in the notice of assessment. Likewise, an interest of 20 percent
per annum, or such higher rate as may be prescribed by rules and regulations,
is to be collected from the date prescribed for its payment until the full
payment.13
The issuance of an assessment is vital in determining the period of limitation
regarding its proper issuance and the period within which to protest it.
Section 20314 of the NIRC provides that internal revenue taxes must be
assessed within three years from the last day within which to file the return.
Section 222,15 on the other hand, specifies a period of ten years in case a
fraudulent return with intent to evade was submitted or in case of failure to
file a return. Also, Section 22816 of the same law states that said assessment
may be protested only within thirty days from receipt thereof. Necessarily,
the taxpayer must be certain that a specific document constitutes an
assessment. Otherwise, confusion would arise regarding the period within
which to make an assessment or to protest the same, or whether interest and
penalty may accrue thereon.
It should also be stressed that the said document is a notice duly sent to the
taxpayer. Indeed, an assessment is deemed made only when the collector of
internal revenue releases, mails or sends such notice to the taxpayer.17
In the present case, the revenue officers Affidavit merely contained a
computation of respondents tax liability.lawphil.net It did not state a demand
or a period for payment. Worse, it was addressed to the justice secretary, not
to the taxpayers.
Respondents maintain that an assessment, in relation to taxation, is simply
understood to mean:
"A notice to the effect that the amount therein stated is due as tax and a
demand for payment thereof."18
"Fixes the liability of the taxpayer and ascertains the facts and furnishes the
data for the proper presentation of tax rolls." 19
Even these definitions fail to advance private respondents case. That the BIR
examiners Joint Affidavit attached to the Criminal Complaint contained
some details of the tax liabilities of private respondents does not ipso
factomake it an assessment. The purpose of the Joint Affidavit was merely to
support and substantiate the Criminal Complaint for tax evasion. Clearly, it
was not meant to be a notice of the tax due and a demand to the private
respondents for payment thereof.
The fact that the Complaint itself was specifically directed and sent to the
Department of Justice and not to private respondents shows that the intent of
the commissioner was to file a criminal complaint for tax evasion, not to
issue an assessment. Although the revenue officers recommended the
issuance of an assessment, the commissioner opted instead to file a criminal
case for tax evasion. What private respondents received was a notice from the
DOJ that a criminal case for tax evasion had been filed against them, not a
notice that the Bureau of Internal Revenue had made an assessment.
Private respondents maintain that the filing of a criminal complaint must be
preceded by an assessment. This is incorrect, because Section 222 of the
NIRC specifically states that in cases where a false or fraudulent return is
submitted or in cases of failure to file a return such as this case, proceedings
in court may be commenced without an assessment. Furthermore, Section
205 of the same Code clearly mandates that the civil and criminal aspects of
the case may be pursued simultaneously. In Ungab v. Cusi,20 petitioner
therein sought the dismissal of the criminal Complaints for being premature,
since his protest to the CTA had not yet been resolved. The Court held that
such protests could not stop or suspend the criminal action which was
independent of the resolution of the protest in the CTA. This was because the
commissioner of internal revenue had, in such tax evasion cases, discretion
on whether to issue an assessment or to file a criminal case against the
taxpayer or to do both.
46
Private respondents insist that Section 222 should be read in relation to
Section 255 of the NIRC,21 which penalizes failure to file a return. They add
that a tax assessment should precede a criminal indictment. We disagree. To
reiterate, said Section 222 states that an assessment is not necessary before a
criminal charge can be filed. This is the general rule. Private respondents
failed to show that they are entitled to an exception. Moreover, the criminal
charge need only be supported by a prima facie showing of failure to file a
required return. This fact need not be proven by an assessment.
The issuance of an assessment must be distinguished from the filing of a
complaint. Before an assessment is issued, there is, by practice, a pre-
assessment notice sent to the taxpayer. The taxpayer is then given a chance to
submit position papers and documents to prove that the assessment is
unwarranted. If the commissioner is unsatisfied, an assessment signed by him
or her is then sent to the taxpayer informing the latter specifically and clearly
that an assessment has been made against him or her. In contrast, the criminal
charge need not go through all these. The criminal charge is filed directly
with the DOJ. Thereafter, the taxpayer is notified that a criminal case had
been filed against him, not that the commissioner has issued an assessment. It
must be stressed that a criminal complaint is instituted not to demand
payment, but to penalize the taxpayer for violation of the Tax Code.
In the cases at bar, the Commissioner denied that she issued a formal
assessment of the tax liability of AMC, Lucas G. Adamson, Therese June D.
Adamson and Sara S. de los Reyes. She admits though that she wrote the
recommendation letter22 addressed to the Secretary of the DOJ
recommending the filing of criminal complaints against AMC and the
aforecited persons for fraudulent returns and tax evasion.
The first issue is whether the Commissioners recommendation letter can be
considered as a formal assessment of private respondents tax liability.
In the context in which it is used in the NIRC, an assessment is a written
notice and demand made by the BIR on the taxpayer for the settlement of a
due tax liability that is there definitely set and fixed. A written
communication containing a computation by a revenue officer of the tax
liability of a taxpayer and giving him an opportunity to contest or disprove
the BIR examiners findings is not an assessment since it is yet indefinite. 23
We rule that the recommendation letter of the Commissioner cannot be
considered a formal assessment. Even a cursory perusal of the said letter
would reveal three key points:
1. It was not addressed to the taxpayers.
2. There was no demand made on the taxpayers to pay the tax
liability, nor a period for payment set therein.
3. The letter was never mailed or sent to the taxpayers by the
Commissioner.
In fine, the said recommendation letter served merely as the prima facie basis
for filing criminal informations that the taxpayers had violated Section 45 (a)
and (d), and 110, in relation to Section 100, as penalized under Section 255,
and for violation of Section 253, in relation to Section 252 9(b) and (d) of the
Tax Code.24
The next issue is whether the filing of the criminal complaints against the
private respondents by the DOJ is premature for lack of a formal assessment.
Section 269 of the NIRC (now Section 222 of the Tax Reform Act of 1997)
provides:
Sec. 269. Exceptions as to period of limitation of assessment and collection
of taxes.-(a) In the case of a false or fraudulent return with intent to evade tax
or of failure to file a return, the tax may be assessed, or a proceeding in court
after the collection of such tax may be begun without assessment, at any time
within ten years after the discovery of the falsity, fraud or omission:
Provided, That in a fraud assessment which has become final and executory,
the fact of fraud shall be judicially taken cognizance of in the civil or
criminal action for collection thereof
The law is clear. When fraudulent tax returns are involved as in the cases at
bar, a proceeding in court after the collection of such tax may be begun
without assessment. Here, the private respondents had already filed the
capital gains tax return and the VAT returns, and paid the taxes they have
declared due therefrom. Upon investigation of the examiners of the BIR,
there was a preliminary finding of gross discrepancy in the computation of
the capital gains taxes due from the sale of two lots of AAI shares, first to
APAC and then to APAC Philippines, Limited. The examiners also found that
the VAT had not been paid for VAT-liable sale of services for the third and
fourth quarters of 1990. Arguably, the gross disparity in the taxes due and the
amounts actually declared by the private respondents constitutes badges of
fraud.
47
Thus, the applicability of Ungab v. Cusi25 is evident to the cases at bar. In this
seminal case, this Court ruled that there was no need for precise computation
and formal assessment in order for criminal complaints to be filed against
him. It quoted Mertens Law of Federal Income Taxation, Vol. 10, Sec.
55A.05, p. 21, thus:
An assessment of a deficiency is not necessary to a criminal prosecution for
willful attempt to defeat and evade the income tax. A crime is complete when
the violator has knowingly and willfully filed a fraudulent return, with intent
to evade and defeat the tax. The perpetration of the crime is grounded upon
knowledge on the part of the taxpayer that he has made an inaccurate return,
and the governments failure to discover the error and promptly to assess has
no connections with the commission of the crime.
This hoary principle still underlies Section 269 and related provisions of the
present Tax Code.
We now go to the issue of whether the CTA has no jurisdiction to take
cognizance of both the criminal and civil cases here at bar.1avvphi1
Under Republic Act No. 1125 (An Act Creating the Court of Tax Appeals) as
amended, the rulings of the Commissioner are appealable to the CTA, thus:
SEC. 7. Jurisdiction. The Court of Tax Appeals shall exercise exclusive
appellate jurisdiction to review by appeal, as herein provided -
(1) Decisions of the Commissioner of Internal Revenue in cases involving
disputed assessments, refunds of internal revenue taxes, fees or other
charges, penalties imposed in relation thereto, or other matters arising under
the National Internal Revenue Code or other laws or part of law administered
by the Bureau of Internal Revenue;
Republic Act No. 8424, titled "An Act Amending the National Internal
Revenue Code, As Amended, And For Other Purposes," later expanded the
jurisdiction of the Commissioner and, correspondingly, that of the CTA, thus:
SEC. 4. Power of the Commissioner to Interpret Tax Laws and to Decide Tax
Cases. The power to interpret the provisions of this Code and other tax
laws shall be under the exclusive and original jurisdiction of the
Commissioner, subject to review by the Secretary of Finance.
The power to decide disputed assessments, refunds of internal revenue taxes,
fees or other charges, penalties imposed in relation thereto, or other matters
arising under this Code or other laws or portions thereof administered by the
Bureau of Internal Revenue is vested in the Commissioner, subject to the
exclusive appellate jurisdiction of the Court of Tax Appeals.
The latest statute dealing with the jurisdiction of the CTA is Republic Act No.
9282.26 It provides:
SEC. 7. Section 7 of the same Act is hereby amended to read as follows:
Sec. 7. Jurisdiction. The CTA shall exercise:
(a) Exclusive appellate jurisdiction to review by appeal, as herein provided:
(1) Decisions of the Commissioner of Internal Revenue in cases
involving disputed assessments, refunds of internal revenue taxes, fees
or other charges, penalties in relation thereto, or other matters arising
under the National Internal Revenue or other laws administered by the
Bureau of Internal Revenue;
(2) Inaction by the Commissioner of Internal Revenue in cases
involving disputed assessments, refunds of internal revenue taxes, fees
or other charges, penalties in relation thereto, or other matters arising
under the National Internal Revenue Code or other laws administered
by the Bureau of Internal Revenue, where the National Internal
Revenue Code provides a specific period of action, in which case the
inaction shall be deemed a denial;
(3) Decisions, orders or resolutions of the Regional Trial Courts in
local tax cases originally decided or resolved by them in the exercise
of their original or appellate jurisdiction;
xxx
(b) Jurisdiction over cases involving criminal offenses as herein provided:
(1) Exclusive original jurisdiction over all criminal offenses arising
from violations of the National Internal Revenue Code or Tariff and
Customs Code and other laws administered by the Bureau of Internal
Revenue or the Bureau of Customs: Provided, however, That offenses
48
or felonies mentioned in this paragraph where the principal amount of
taxes and fees, exclusive of charges and penalties, claimed is less than
One million pesos (P1,000,000.00) or where there is no specified
amount claimed shall be tried by the regular courts and the jurisdiction
of the CTA shall be appellate. Any provision of law or the Rules of
Court to the contrary notwithstanding, the criminal action and the
corresponding civil action for the recovery of civil liability for taxes
and penalties shall at all times be simultaneously instituted with, and
jointly determined in the same proceeding by the CTA, the filing of the
criminal action being deemed to necessarily carry with it the filing of
the civil action, and no right to reserve the filling of such civil action
separately from the criminal action will be recognized.
(2) Exclusive appellate jurisdiction in criminal offenses:
(a) Over appeals from the judgments, resolutions or orders of the
Regional Trial Courts in tax cases originally decided by them, in their
respected territorial jurisdiction.
(b) Over petitions for review of the judgments, resolutions or orders of
the Regional Trial Courts in the exercise of their appellate jurisdiction
over tax cases originally decided by the Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit Trial Courts in their
respective jurisdiction.
(c) Jurisdiction over tax collection cases as herein provided:
(1) Exclusive original jurisdiction in tax collection cases
involving final and executory assessments for taxes, fees,
charges and penalties: Provided, however, That collection cases
where the principal amount of taxes and fees, exclusive of
charges and penalties, claimed is less than One million pesos
(P1,000,000.00) shall be tried by the proper Municipal Trial
Court, Metropolitan Trial Court and Regional Trial Court.
(2) Exclusive appellate jurisdiction in tax collection cases:
(a) Over appeals from the judgments, resolutions or
orders of the Regional Trial Courts in tax collection cases
originally decided by them, in their respective territorial
jurisdiction.
(b) Over petitions for review of the judgments, resolutions
or orders of the Regional Trial Courts in the exercise of
their appellate jurisdiction over tax collection cases
originally decided by the Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit Trial
Courts, in their respective jurisdiction.
These laws have expanded the jurisdiction of the CTA. However, they did not
change the jurisdiction of the CTA to entertain an appeal only from a final
decision or assessment of the Commissioner, or in cases where the
Commissioner has not acted within the period prescribed by the NIRC. In the
cases at bar, the Commissioner has not issued an assessment of the tax
liability of private respondents.
Finally, we hold that contrary to private respondents stance, the doctrines
laid down in CIR v. Union Shipping Co. and Yabes v. Flojo are not applicable
to the cases at bar. In these earlier cases, the Commissioner already rendered
an assessment of the tax liabilities of the delinquent taxpayers, for which
reason the Court ruled that the filing of the civil suit for collection of the
taxes due was a final denial of the taxpayers request for reconsideration of
the tax assessment.
IN VIEW WHEREOF, premises considered, judgment is rendered:
1. In G.R. No. 120935, AFFIRMING the CA decision dated March
21, 1995, which set aside the Regional Trial Courts Order dated
August 8, 1994, and REINSTATING Criminal Case Nos. 94-1842 to
94-1846 for further proceedings before the trial court; and
2. In G.R. No. 124557, REVERSING and SETTING ASIDE the
Decision of the Court of Appeals dated March 29, 1996, and
ORDERING the dismissal of C.T.A. Case No. 5075.
Footnotes
3
The NIRC of the Philippines, Annotated, 16th and Revised Edition,
Nolledo, J. and Nolledo, M. (1993), p. 414.
Section 45. Corporation Returns. -
49
 (A) Requirements. - Every corporation, subject to the tax
herein imposed, except foreign corporations not engaged
in trade or business in the Philippines shall render, in
duplicate, a true and accurate quarterly income tax return
and final or adjustment return in accordance with the
provisions of Chapter IX of this Title. The return shall be
filed by the president, vice-president or other principal
officer, and shall be sworn to by such officer and by the
treasurer or assistant treasurer.
xxx
(D) Return on Capital Gains Realized from Sale of Shares
of Stock. - Every corporation deriving capital gains from
the sale or exchange of shares of stock not traded thru a
local stock exchange as prescribed under Sections 24 (e) 2
A, 25 (a) (6) (C) (i), 25(b)(5)(C) (i), shall file a return
within thirty (30) days after each transactions and a final
consolidated return of all transactions during the taxable
year on or before the fifteenth (15th) day of the fourth
(4th) month following the close of the taxable year.
4
SECTION 110. Return and Payment of Value-Added Tax.
(A) Where to File the Return and Pay the Tax. - Every person
subject to value-added tax shall file a quarterly return of his
gross sales or receipts and pay the tax due thereon to a bank
duly accredited by the Commissioner located in the revenue
district where such person is registered or required to be
registered. However, in cases where there are no duly accredited
agent banks within the city or municipality, the return shall be
filed and any amount due shall be paid to any duly accredited
bank within the district, or to the Revenue District Officer,
Collection Agent or duly authorized Treasurer of the city or
municipality where such taxpayer has his principal place of
business. Only one consolidated return shall be filed by the
taxpayer for all the branches and lines of business subject to
value-added tax. If no tax is payable because the amount of
input tax and any amount authorized to be offset against the
output tax is equal to or is in excess of the output tax due on the
return, the taxpayer shall file the return with the Revenue
District Officer, Collection Agent or authorized municipal
treasurer where the taxpayers principal place of business is
located.
(B) Time for filing of return and payment of tax. The return
shall be filed and the tax paid within 20 days following the end
of each quarter specifically prescribed for a VAT-registered
person under regulations to be promulgated by the Secretary of
Finance: Provided, however, That any person whose registration
is cancelled in accordance with paragraph (e) of Section 107
shall file a return within 20 days from the cancellation of such
registration.
(C) Initial returns. The Commissioner may prescribe an initial
taxable period for any VAT-registered person for his first return,
which in no case shall exceed 5 months.
5
Supra note 3 at pp. 588-590.
Section 100. Value-Added Tax on Sale of Goods. -
(A) Rate and Base of Tax. - There shall be levied, assessed and
collected on every sale, barter or exchange of goods, a value-
added tax equivalent to 10% of the gross selling price or gross
value in money of the goods or properties sold, bartered or
exchanged, such tax to be paid by the seller or transferor:
Provided, That the following sales by VAT-registered persons
shall be subject to zero percent (0%):
(1) Export sales; and
(2) Sales to persons or entities whose exemption under
special laws or international agreements to which the
Philippines is a signatory effectively subjects such sales to
zero rate.
"Export Sales" means the sale and shipment or
exportation of goods from the Philippines to a foreign
country, irrespective of any shipping arrangement that
may be agreed upon which may influence or determine
the transfer of ownership of the goods so exported, or
foreign currency denominated sales. "Foreign currency
50
 denominated sales," means sales to nonresidents of goods
assembled or manufactured in the Philippines, for
delivery to residents in the Philippines and paid for in
convertible foreign currency remitted through the banking
system in the Philippines.
(B) Transactions Deemed Sale. - The following transactions
shall be deemed sale:
(1) Transfer, use or consumption not in the course of
business of goods originally intended for sale or for use in
the course of business;
(2) Distribution or transfer to:
(a) Shareholders or investors as share in the profits
of the registered person; or
(b) Creditors in payment of debt;
(3) Consignment of goods if actual sale is not made
within sixty (60) days following the date such goods were
consigned;
(4) Retirement from or cessation of business, with respect
to inventories of taxable goods existing as of such
retirement or cessation.
(C) Changes in or Cessation of Status of a VAT-registered
Person. - The tax imposed in paragraph (a) of this Section shall
also apply to goods disposed of or existing as of a certain date if
under circumstances to be prescribed in Regulations to be
promulgated by the Secretary of Finance, the status of a person
as a VAT-registered person changes or is terminated.
(D) Determination of the Tax. -
(1) Tax billed as a separate item in the invoice. If the tax
is billed as a separate item in the invoice, the tax shall be
based on the gross selling price, excluding the tax. "Gross
selling price" means the total amount of money or its
equivalent which the purchaser pays or is obligated to pay
to the seller in consideration of the sale, barter or
exchange of the goods, excluding the value-added tax.
The excise tax, if any, on such goods or properties shall
form part of the gross selling price.
(2) Tax not billed separately or is billed erroneously in the
invoice. In case the tax is not billed separately or is
billed erroneously in the invoice, the tax shall be
determined by multiplying the gross selling price,
including th amount intended by the seller to cover the tax
or the tax billed erroneously, by the factor 1/11 or such
factor as may be prescribed by regulations in case of
persons partially exempt under special laws.
(3) Sales Returns, Allowances and Sales Discounts. - The
value of goods sold and subsequently returned or for
which allowances were granted by a VAT-registered
person may be deducted from the gross sales or receipts
for the quarter in which a refund is made or a credit
memorandum or refund is issued. Sales discount granted
and indicated in the invoice at the time of sale may be
excluded from the gross sales within the same quarter.
(4) Authority of the Commissioner to Determine the
Appropriate Tax Base. - The Commissioner shall, by
regulations, determine the appropriate tax base in cases
where a transaction is deemed a sale, barter or exchange
of goods under paragraph (b) hereof, or where the gross
selling price is unreasonably lower than the actual market
value.
6
Id. at 1022.
Section 255. Penal Liability of Corporations. Any corporation,
association or general co-partnership liable for any of the acts or
omissions penalized under this Code, in addition to the penalties
imposed herein upon the responsible corporate officers, partners
or employees, shall, upon conviction, for each act or omission
be fined for not less than ten thousand pesos but not more than
one hundred thousand pesos.
51
7
Id. at 1021.
Section 253. Attempt to evade or defeat tax. -- Any person who
willfully attempts in any manner to evade or defeat any tax
imposed under this Code or the payment thereof shall, in
addition to other penalties provided by law, upon conviction
thereof, be fined not more than ten thousand pesos or
imprisoned for not more than two years, or both.
8
Id., pp. 1020-1021.
Section 252. General provisions.
xxx
(b) Any person who willfully aids or abets in the commission of
a crime penalized herein or who causes the commission of any
such offense by another, shall be liable in the same manner as
the principal.
xxx
(d) In the case of associations, partnerships, or corporations, the
penalty shall be imposed on the partner, president, general
manager, branch manager, treasurer, officer-in-charge, and
employees responsible for the violation.
12
Revenue Regulation No. 12-85.
13
NIRC (1997)
"Sec. 205. Remedies for the Collection of Delinquent Taxes. --
The civil remedies for the collection of internal revenue, fees, or
charges, and increment thereto resulting from delinquency shall
be:
(a) By distraint of goods, chattels, or effects, and other
personal property of whatever character, including stocks
and other securities, debts, credits, bank accounts, and
interest in and rights to personal property, and by levy
upon real property and interest in or rights to real
property; and
(b) By civil or criminal action.
Either of these remedies or both simultaneously may be pursued
in the discretion of the authorities charged with the collection of
such taxes: Provided, however, That the remedies of distraint
and levy shall not be availed of where the amount of tax
involved is not more than One hundred pesos (P100).
The judgment in the criminal case shall not only impose the
penalty but shall also order payment of the taxes subject of the
criminal case as finally decided by the Commissioner.
The Bureau of Internal Revenue shall advance the amounts
needed to defray costs of collection by means of civil or
criminal action, including the preservation or transportation of
personal property distrained and the advertisement and sale
thereof, as well as of real property and improvements thereon."
14
Id.
"SEC. 203. Period of Limitation Upon Assessment and
Collection. -- Except as provided in Section 222, internal
revenue taxes shall be assessed within three (3) years after the
last day prescribed by law for the filing of the return, and no
proceeding in court without assessment for the collection of
such taxes shall be begun after the expiration of such
period: Provided, That in a case where a return is filed beyond
the period prescribed by law, the three (3)-year period shall be
counted from the day the return was filed. For purposes of this
Section, a return filed before the last day prescribed by law for
the filing thereof shall be considered as filed on such last day."
15
Id.
"Sec. 222. Exceptions as to Period of Limitation of Assessment
and Collection of Taxes.
52
 (a) In the case of a false or fraudulent return with intent to evade
tax or of failure to file a return, the tax may be assessed, or a
proceeding in court for the collection of such tax may be filed
without assessment, at any time within ten (10) years after the
discovery of the falsity, fraud or omission:Provided, That in a
fraud assessment which has become final and executory, the fact
of fraud shall be judicially taken cognizance of in the civil or
criminal action for the collection thereof.
(b) If before the expiration of the time prescribed in the Section
203 for the assessment of the tax, both the Commissioner and
the taxpayer have agreed in writing to its assessment after such
time, the tax may be assessed within the period agreed upon.
The period so agreed upon may be extended by subsequent
written agreement made before the expiration of the period
previously agreed upon.
(c) Any internal revenue tax which has been assessed within the
period of limitation as prescribed in paragraph (a) hereof may be
collected by distraint or levy or by a proceeding in court within
five (5) years following the assessment of the tax.
(d) Any internal revenue tax, which has been assessed within the
period agreed upon as provided in paragraph (b) hereinabove,
may be collected by distraint or levy or by a proceeding in court
within the period agreed upon writing before the expiration of
the five (5)-year period. The period so agreed upon may be
extended by subsequent written agreements made before the
expiration of the period previously agreed upon.
(e) Provided, however, That nothing in the immediately
preceding Section and paragraph (a) hereof shall be construed to
authorize the examination and investigation or inquiry into any
tax return filed in accordance with the provisions of any tax
amnesty law or decree."
16
Id.
"Section 228. Protesting of Assessment. -- When the
Commissioner or his duly authorized representative finds that
proper taxes should be assessed, he shall first notify the taxpayer
of his findings: Provided, however, That a reassessment notice
shall not be required in the following cases:
(a) When the finding for any deficiency tax is the result of
mathematical error in the computation of the tax as
appearing on the face of the return; or
(b) When a discrepancy has been determined between the
tax withheld and the amount actually remitted by the
withholding agent; or
(c) When a taxpayer who opted to claim a refund or tax
credit of excess creditable withholding tax for a taxable
period was determined to have carried over and
automatically applied the same amount claimed against
the estimated tax liabilities for the taxable quarter or
quarters of the succeeding taxable year; or
(d) When the excise tax due on excisable articles has not
been paid; or
(e) When an article locally purchased or imported by an
exempt person, such as, but not limited to, vehicles,
capital equipment, machineries and spare parts, has been
sold, traded or transferred to non-exempt persons.
The taxpayer shall be informed in writing of the law and the
facts on which the assessment is made; otherwise, the
assessment shall be void.
Within a period to be prescribed by implementing rules and
regulations, the taxpayer shall be required to respond to said
notice. If the taxpayer fails to respond, the Commissioner or his
duly authorized representative shall issue an assessment based
on his findings."
21
"SEC 255. Failure to File Return, Supply Correct and Accurate
Information, Pay Tax, Withhold and Remit Tax and Refund Excess
Taxes Withheld on Compensation. -- Any person required under this
Code or by rules and regulations promulgated thereunder to pay any
tax, make a return, keep any record, or supply correct and accurate any
53
information, who willfully fails to pay such tax, make such return,
keep such record, or supply correct and accurate information, or
withhold or remit taxes withheld, or refund excess taxes withheld on
compensation, at the time or times required by law or rules and
regulations shall, in addition to other penalties provided by law, upon
conviction thereof, be punished by a fine of not less than one (1) year
but not more than ten (10) years.

Any person who attempts to make it appear for any reason that
he or another has in fact filed a return or statement, or actually
files a return or statement and subsequently withdraws the same
return or statement after securing the official receiving seal or
stamp of receipt of an internal revenue office wherein the same
was actually filed shall, upon conviction therefor, be punished
by a fine of not less than Ten thousand pesos (P10,000) but not
more than Twenty thousand pesos (P20,000) and suffer
imprisonment of not less than one (1) year but not more than
three (3) years."

26
An Act Expanding The Jurisdiction Of The Court Of Tax Appeals
(CTA), Elevating Its Rank To The Level Of A Collegiate Court With
Special Jurisdiction And Enlarging Its Membership, Amending For
The Purpose Certain Sections Of Republic Act No. 1125, As Amended,
Otherwise Known As The Law Creating The Court Of Tax Appeals,
And For Other Purposes.

54

18. MAJOR GENERAL CARLOS F. GARCIA v. SANDIGANBAYAN and
the OFFICE OF THE OMBUDSMAN
G.R. No. 165835 June 22, 2005
Republic Act No. 8249
Petitioner Major General Carlos F. Garcia was the Deputy Chief of Staff for
Comptrollership, J6, of the Armed Forces of the Philippines. Petitioner filed
this Petition for certiorari and prohibition under Rule 65 to annul and set
aside public respondent Sandiganbayans Resolution1 dated 29 October 2004
and Writ of Preliminary Attachment2 dated 2 November 2004, and to enjoin
public respondents Sandiganbayan and Office of the Ombudsman from
further proceeding with any action relating to the enforcement of the assailed
issuances.
On 27 September 2004, Atty. Maria Olivia Elena A. Roxas, Graft
Investigation and Prosecution Officer II of the Field Investigation Office of
the Office of the Ombudsman, after due investigation, filed a complaint
against petitioner with public respondent Office of the Ombudsman, for
violation of Sec. 8, in relation to Sec. 11 of Republic Act (R.A.) No.
6713,3 violation of Art. 183 of the Revised Penal Code, and violation of
Section 52 (A)(1), (3) and (20) of the Civil Service Law. Based on this
complaint, a case for Violations of R.A. No. 1379, 4 Art. 183 of the Revised
Penal Code, and Sec. 8 in relation to Sec. 11 of R.A. No. 6713, docketed as
Case
No. OMB-P-C-04-1132-I, was filed against petitioner.5 Petitioners wife
Clarita Depakakibo Garcia, and their three sons, Ian Carl, Juan Paolo and
Timothy Mark, all surnamed Garcia, were impleaded in the complaint for
violation of R.A. No. 1379 insofar as they acted as conspirators, conduits,
dummies and fronts of petitioner in receiving, accumulating, using and
disposing of his ill-gotten wealth.
On the same day, 27 October 2004, the Republic of the Philippines, acting
through public respondent Office of the Ombudsman, filed before the
Sandiganbayan, a Petition with Verified Urgent Ex Parte Application for the
Issuance of a Writ of Preliminary Attachment6 against petitioner, his wife,
and three sons, seeking the forfeiture of unlawfully acquired properties under
Sec. 2 of R.A. No. 1379, as amended. The petition was docketed as Civil
Case No. 0193, entitled "Republic of the Philippines vs. Maj. Gen. Carlos F.
Garcia, et al." It was alleged that the Office of the Ombudsman, after
conducting an inquiry similar to a preliminary investigation in criminal cases,
has determined that a prima facie case exists against Maj. Gen. Garcia and
the other respondents therein who hold such properties for, with, or on behalf
of, Maj. Gen. Garcia, since during his incumbency as a soldier and public
officer he acquired huge amounts of money and properties manifestly out of
proportion to his salary as such public officer and his other lawful income, if
any.7
Acting on the Republics prayer for issuance of a writ of preliminary
attachment, the Sandiganbayan issued the questioned Resolution granting the
relief prayed for. The corresponding writ of preliminary attachment was
subsequently issued on 2 November 2004 upon the filing of a bond by the
Republic. On 17 November 2004, petitioner (as respondent a quo) filed
a Motion to Dismiss8 in Civil Case No. 0193 on the ground of lack of
jurisdiction of the Sandiganbayan over forfeiture proceedings under R.A. No.
1379. On even date, petitioner filed the present Petition, raising the same
issue of lack jurisdiction on the part of the Sandiganbayan.
Petitioner argues in this Petition that the Sandiganbayan is without
jurisdiction over the "civil action" for forfeiture of unlawfully acquired
properties under R.A. No. 1379, maintaining that such jurisdiction actually
resides in the Regional Trial Courts as provided under Sec. 2 9 of the law, and
that the jurisdiction of the Sandiganbayan in civil actions pertains only to
separate actions for recovery of unlawfully acquired property against
President Marcos, his family, and cronies as can be gleaned from Sec. 4 of
Presidential Decree (P.D.) No. 1606,10 as amended, and Executive Orders
(E.O.) Nos. 1411 and 14-A.12
Theorizing that the Sandiganbayan, under P.D. No. 1606 or the law creating
it, was intended principally as a criminal court, with no jurisdiction over
separate civil actions, petitioner points to President Corazon C. Aquinos
issuances after the EDSA Revolution, namely: (1) E.O. No. 1 creating the
Presidential Commission on Good Government (PCGG) for the recovery of
ill-gotten wealth amassed by President Ferdinand E. Marcos, his family and
cronies, (2) E.O. No. 14 which amended P.D. No. 1606 and R.A. No. 1379 by
transferring to the Sandiganbayan jurisdiction over civil actions filed against
President Marcos, his family and cronies based on R.A. No. 1379, the Civil
Code and other existing laws, and (3) E.O. No. 14-A whch further amended
E.O. No. 14, P.D. No. 1606 and R.A. No. 1379 by providing that the civil
55
action under R.A. No. 1379 which may be filed against President Marcos, his
family and cronies, may proceed independently of the criminal action.
Petitioner gathers from the presidential issuances that the Sandiganbayan has
been granted jurisdiction only over the separate civil actions filed against
President Marcos, his family and cronies, regardless of whether these civil
actions were for recovery of unlawfully acquired property under R.A. No.
1379 or for restitution, reparation of damages or indemnification for
consequential damages or other civil actions under the Civil Code or other
existing laws. According to petitioner, nowhere in the amendments to P.D.
No. 1606 and R.A. No. 1379 does it provide that the Sandiganbayan has been
vested jurisdiction over separate civil actions other than those filed against
President Marcos, his family and cronies.13 Hence, the Sandiganbayan has no
jurisdiction over any separate civil action against him, even if such separate
civil action is for recovery of unlawfully acquired property under R.A. No.
1379.
Petitioner further contends that in any event, the petition for forfeiture filed
against him is fatally defective for failing to comply with the jurisdictional
requirements under Sec. 2, R.A. No. 1379, 14 namely: (a) an inquiry similar to
a preliminary investigation conducted by the prosecution arm of the
government; (b) a certification to the Solicitor General that there is
reasonable ground to believe that there has been violation of the said law and
that respondent is guilty thereof; and (c) an action filed by the Solicitor
General on behalf of the Republic of the Philippines. 15 He argues that only
informations for perjury were filed and there has been no information filed
against him for violation of R.A. No. 1379. Consequently, he maintains, it is
impossible for the Office of the Ombudsman to certify that there is
reasonable ground to believe that a violation of the said law had been
committed and that he is guilty thereof. The petition is also supposedly bereft
of the required certification which should be made by the investigating City
or Provincial Fiscal (now Prosecutor) to the Solicitor General. Furthermore,
he opines that it should have been the Office of the Solicitor General which
filed the petition and not the Office of the Ombudsman as in this case. The
petition being fatally defective, the same should have been dismissed,
petitioner concludes.
In their Comment,16 respondents submit the contrary, noting that the issues
raised by petitioner are not novel as these have been settled in Republic vs.
Sandiganbayan17 which categorically ruled that "there is no issue that
jurisdiction over violations of [R.A.] Nos. 3019 and 1379 now rests with the
Sandiganbayan."18 Respondents argue that under the Constitution19 and
prevailing statutes, the Sandiganbayan is vested with authority and
jurisdiction over the petition for forfeiture under R.A. No. 1379 filed against
petitioner. Respondents point to Sec. 4.a (1) (d) of P.D. 1606, as amended, as
the prevailing law on the jurisdiction of the Sandiganbayan, thus:
Sec. 4. Jurisdiction.The Sandiganbayan shall exercise exclusive original
jurisdiction in all cases involving:
a. Violations of Republic Act No. 3019, as amended, otherwise known as the
Anti-Graft and Corrupt Practices Act, Republic Act No. 1379, and Chapter II,
Section 2, Title VII, Book II of the Revised Penal Code, where one or more
of the accused are officials occupying the following positions in the
government, whether in a permanent, acting or interim capacity, at the time
of the commission of the offense:
(1) Officials of the executive branch occupying the positions of regional
director and higher, otherwise classified as Grade 27 and higher of the
Compensation and Position Classification Act of 1989 (Republic Act No.
6758), specifically including:
.
(d) Philippine army and air force colonels, naval captains, and all officers of
higher ranks;
.
As petitioner falls squarely under the category of public positions covered by
the aforestated law, the petition for forfeiture should be within the
jurisdiction of the Sandiganbayan.
Respondents also brush off as inconsequential petitioners argument that the
petition for forfeiture is "civil" in nature and the Sandiganbayan, having
allegedly no jurisdiction over civil actions, therefore has no jurisdiction over
the petition, since the same P.D. No. 1606 encompasses all cases involving
violations of R.A. No. 3019, irrespective of whether these cases are civil or
criminal in nature. The petition for forfeiture should not be confused with the
cases initiated and prosecuted by the PCGG pursuant to E.O. Nos. 14 and 14-
A, as these are dealt with under a separate subparagraph of P.D. No. 1606, as
amended, in particular Sec. 4.c thereof.20 Further, respondents stress that E.O.
Nos. 14 and 14-A exclusively apply to actions for recovery of unlawfully
56
acquired property against President Marcos, his family, and cronies. It would
also not be accurate to refer to a petition for forfeiture as a "civil case," since
it has been held that petitions for forfeiture are deemed criminal or penal and
that it is only the proceeding for its prosecution which is civil in nature. 21
The Office of the Ombudsman filed a separate Comment,22 likewise relying
on Republic v. Sandiganbayan to argue that the Sandiganbayan has
jurisdiction over the petition for forfeiture filed against petitioner. The
Ombudsman explains that the grant to the Sandiganbayan of jurisdiction over
violations of R.A. No. 1379 did not change even under the amendments of
R.A. No. 797523 and R.A. No. 829424, although it came to be limited to cases
involving high-ranking public officials as enumerated therein, including
Philippine army and air force colonels, naval captains, and all other officers
of higher rank, to which petitioner belongs.25
In arguing that it has authority to investigate and initiate forfeiture
proceedings against petitioner, the Office of the Ombudsman refers to both
the Constitution26 and R.A. No. 6770.27 The constitutional power of
investigation of the Office of the Ombudsman is plenary and unqualified; its
power to investigate any act of a public official or employee which appears
to be "illegal, unjust, improper or inefficient" covers the unlawful acquisition
of wealth by public officials as defined under R.A. No. 1379. Furthermore,
Sec. 15 (11)28 of R.A. No. 6770 expressly empowers the Ombudsman to
investigate and prosecute such cases of unlawful acquisition of wealth. This
authority of the Ombudsman has been affirmed also in Republic vs.
Sandiganbayan.29
The Office of the Ombudsman then refutes petitioners allegation that the
petition for forfeiture filed against him failed to comply with the procedural
and formal requirements under the law. It asserts that all the requirements of
R.A. No. 1379 have been strictly complied with. An inquiry similar to a
preliminary investigation was conducted by a Prosecution Officer of the
Office of the Ombudsman. The participation of the Office of the Solicitor
General, claimed by petitioner to be necessary, is actually no longer required
since the Office of the Ombudsman is endowed with the authority to
investigate and prosecute the case as discussed above. 30
In addition, the Office of the Ombudsman alleges that the
present Petition should be dismissed for blatant forum-shopping. Even as
petitioner had filed a Motion to Dismiss as regards the petition for forfeiture
(docketed as Civil Case No. 0193) before the Sandiganbayan on the ground
of the Sandiganbayans alleged lack of jurisdiction, he filed the
instant Petition raising exactly the same issue, even though the Motion to
Dismiss in Civil Case No. 0193 is still pending resolution.1avvphi1 Worse, it
appears that the Motion to Dismiss and the instant Petition were filed on the
same day, 17 November 2004.
Petitioner refutes these arguments in his Reply31 and enunciates that the
Sandiganbayans criminal jurisdiction is separate and distinct from its civil
jurisdiction, and that the Sandiganbayans jurisdiction over forfeiture cases
had been removed without subsequent amendments expressly restoring such
civil jurisdiction. His thesis is that R.A. No. 1379 is a special law which is
primarily civil and remedial in nature, the clear intent of which is to separate
theprima facie determination in forfeiture proceedings from the litigation of
the civil action. This intent is further demonstrated by Sec. 2 of R.A. No.
1379 which grants the authority to make an inquiry similar to a preliminary
investigation being done by the City or Provincial Fiscal, and the authority to
file a petition for forfeiture to the Solicitor General.
Petitioner also points out in his Reply32 to the Comment of the Office of the
Ombudsman, that the use of the phrase "violations of [R.A.] Nos. 3019 and
1379" in P.D. No. 1606, as amended, implies jurisdiction over cases which
are principally criminal or penal in nature because the concept of "violation"
of certain laws necessarily carries with it the concept of imposition of
penalties for such violation. Hence, when reference was made to "violations
of [R.A.] Nos. 3019 and 1379," the only jurisdiction that can supposedly be
implied is criminal jurisdiction, not civil jurisdiction, thereby highlighting
respondent Sandiganbayans lack of jurisdiction over the "civil case" for
forfeiture of ill-gotten wealth. Of course, petitioner does not rule out cases
where the crime carries with it the corresponding civil liability such that
when the criminal action is instituted, the civil action for enforcement of the
civil liability is impliedly instituted with it, and the court having jurisdiction
over the criminal action also acquires jurisdiction over the ancillary civil
action. However, petitioner argues that the action for forfeiture subject of this
case is not the ancillary civil action impliedly instituted with the criminal
action. Rather, the petition for forfeiture is an independent civil action over
which the Sandiganbayan has no jurisdiction. Petitioner points to P.D. No.
1606, as amended, which treats of independent civil actions only in the last
paragraph of Sec. 4 thereof:
Any provisions of law or Rules of Court to the contrary notwithstanding, the
criminal action and the corresponding civil action for the recovery of civil
liability shall at all times be simultaneously instituted with, and jointly
57
determined in, the same proceeding by the Sandiganbayan or the appropriate
courts, the filing of the criminal action being deemed to necessarily carry
with it the filing of the civil action, and no right to reserve the filing of such
civil action separately from the criminal action shall be recognized: Provided,
however, That where the civil action had heretofore been filed separately but
judgment therein has not yet been rendered, and the criminal case is hereafter
filed with the Sandiganbayan or the appropriate court, said civil action shall
be transferred to the Sandiganbayan or the appropriate court, as the case may
be, for consolidation and joint determination with the criminal action,
otherwise the separate civil action shall be deemed abandoned.
Petitioner however did not raise any argument to refute the charge of forum-
shopping.
The issues for resolution are: (a) whether the Sandiganbayan has jurisdiction
over petitions for forfeiture under R.A. No. 1379; (b) whether the Office of
the Ombudsman has the authority to investigate, initiate and prosecute such
petitions for forfeiture; and (c) whether petitioner is guilty of forum-
shopping.
The petition is patently without merit. It should be dismissed.
The seminal decision of Republic v. Sandiganbayan33 squarely rules on the
issues raised by petitioner concerning the jurisdiction of the Sandiganbayan
and the authority of the Office of the Ombudsman. After reviewing the
legislative history of the Sandiganbayan and the Office of the Ombudsman,
the Court therein resolved the question of jurisdiction by the Sandiganbayan
over violations of R.A. No. 3019 and R.A. No. 1379. Originally, it was the
Solicitor General who was authorized to initiate forfeiture proceedings before
the then Court of First Instance of the city or province where the public
officer or employee resides or holds office, pursuant to Sec. 2 of R.A. No.
1379. Upon the creation of the Sandiganbayan pursuant to P.D. No.
1486,34 original and exclusive jurisdiction over such violations was vested in
the said court.35 P.D. No. 160636 was later issued expressly repealing P.D. No.
1486, as well as modifying the jurisdiction of the Sandiganbayan by
removing its jurisdiction over civil actions brought in connection with crimes
within the exclusive jurisdiction of said court. 37 Such civil actions removed
from the jurisdiction of the Sandigabayan include those for restitution or
reparation of damages, recovery of instruments and effects of the crime, civil
actions under Articles 32 and 34 of the Civil Code, and forfeiture
proceedings provided for under R.A. No. 1379.38
Subsequently, Batas Pambansa Blg. 12939 abolished the concurrent
jurisdiction of the Sandiganbayan and the regular courts and expanded the
exclusive original jurisdiction of the Sandiganbayan over the offenses
enumerated in Sec. 4 of P.D. No. 1606 to embrace all such offenses
irrespective of the imposable penalty. Since this change resulted in the
proliferation of the filing of cases before the Sandiganbayan where the
offense charged is punishable by a penalty not higher than prision
correccional or its equivalent, and such cases not being of a serious nature,
P.D. No. 1606 was again amended by P.D. No. 186040 and eventually by P.D.
No. 1861.41
On the foregoing premises alone, the Court in Republic v.
Sandiganbayan, deduced that jurisdiction over violations of R.A. No. 3019
and 1379 is lodged with the Sandiganbayan.42 It could not have taken into
consideration R.A. No. 797543 and R.A. No. 824944 since both statutes which
also amended the jurisdiction of the Sandiganbayan were not yet enacted at
the time. The subsequent enactments only serve to buttress the conclusion
that the Sandiganbayan indeed has jurisdiction over violations of R.A. No.
1379.
Under R.A. No. 8249, the Sandiganbayan is vested with exclusive original
jurisdiction in all cases involving violations of R.A. No. 3019, R.A. No.
1379, and Chapter II, Sec. 2, Title VII, Book II of the Revised Penal Code,
where one or more of the accused are officials occupying the following
positions whether in a permanent, acting or interim capacity, at the time of
the commission of the offense: (1) Officials of the executive branch
occupying the positions of regional director and higher, otherwise classified
as Grade '27' and higher, of the Compensation and Position Classification Act
of 989 (R.A. No. 6758), specifically including: (a) Provincial governors,
vice-governors, members of the sangguniang panlalawigan, and provincial
treasurers, assessors, engineers, and other city department heads; (b) City
mayor, vice-mayors, members of the sangguniang panlungsod, city
treasurers, assessors, engineers, and other city department heads; (c) Officials
of the diplomatic service occupying the position of consul and higher;
(d) Philippine army and air force colonels, naval captains, and all officers of
higher rank; (e) Officers of the Philippine National Police while occupying
the position of provincial director and those holding the rank of senior
superintended or higher; (f) City and provincial prosecutors and their
assistants, and officials and prosecutors in the Office of the Ombudsman and
special prosecutor; (g) Presidents, directors or trustees, or managers of
government-owned or controlled corporations, state universities or
educational institutions or foundations; (2) Members of Congress and
58
officials thereof classified as Grade '27' and up under the Compensation and
Position Classification Act of 1989; (3) Members of the judiciary without
prejudice to the provisions of the Constitution; (4) Chairmen and members of
Constitutional Commission, without prejudice to the provisions of the
Constitution; and (5) All other national and local officials classified as Grade
'27' and higher under the Compensation and Position Classification Act of
1989.45
In the face of the prevailing jurisprudence and the present state of statutory
law on the jurisdiction of the Sandiganbayan, petitioners argumentthat the
Sandiganbayan has no jurisdiction over the petition for forfeiture it being
"civil" in nature and the Sandiganbayan allegedly having no jurisdiction over
civil actionscollapses completely.
The civil nature of an action for forfeiture was first recognized in Republic v.
Sandiganbayan, thus: "[T]he rule is settled that forfeiture proceedings are
actions in rem and, therefore, civil in nature."46 Then, Almeda, Sr.
v. Perez,47 followed, holding that the proceedings under R.A. No. 1379 do not
terminate in the imposition of a penalty but merely in the forfeiture of the
properties illegally acquired in favor of the State. It noted that the
procedure outlined in the law leading to forfeiture is that provided for in a
civil action.48
However, the Court has had occasion to rule that forfeiture of illegally
acquired property partakes the nature of a penalty. In Cabal v. Kapunan,
Jr.,49 the Court cited voluminous authorities in support of its declaration of
the criminal or penal nature of forfeiture proceedings, viz:
In a strict signification, a forfeiture is a divestiture of property without
compensation, in consequence of a default or an offense, and the term is used
in such a sense in this article. A forfeiture, as thus defined, is imposed by way
of punishment not by the mere convention of the parties, but by the
lawmaking power, to insure a prescribed course of conduct. It is a method
deemed necessary by the legislature to restrain the commission of an offense
and to aid in the prevention of such an offense. The effect of such a forfeiture
is to transfer the title to the specific thing from the owner to the sovereign
power. (23 Am. Jur. 599)
"In Black's Law Dictionary a 'forfeiture' is defined to be 'the incurring of a
liability to pay a definite sum of money as the consequence of violating the
provisions of some statute or refusal to comply with some requirement of
law.' It may be said to be a penalty imposed for misconduct or breach of
duty.'" (Com. vs. French, 114 S.W. 255.)
.
"Generally speaking, informations for the forfeiture of goods that seek no
judgment of fine or imprisonment against any person are deemed to be civil
proceedings in rem. Such proceedings are criminal in nature to the extent that
where the person using the res illegally is the owner of rightful possessor of it
the forfeiture proceeding is in the nature of a punishment. They have been
held to be so far in the nature of
criminal proceedings that a general verdict on several counts in an
information is upheld if one count is good. According to the authorities such
proceedings, where the owner of the property appears, are so far considered
as quasicriminal proceedings as to relieve the owner from being a witness
against himself and to prevent the compulsory production of his books and
papers. . . ." (23 Am. Jur. 612)
.
"Proceedings for forfeitures are generally considered to be civil and in the
nature of proceedings in rem. The statute providing that no judgment or other
proceedings in civil causes shall be arrested or reversed for any defect or
want of form is applicable to them. In some aspects, however, suits for
penalties and forfeitures are of quasi-criminal nature and within the reason of
criminal proceedings for all the purposes of . . . that portion of the Fifth
Amendment which declares that no person shall be compelled in any
criminal case to be a witness against himself. The proceeding is one against
the owner, as well as against the goods; for it is his breach of the laws which
has to be proved to establish the forfeiture and his property is sought to be
forfeited." (15 Am. Jur., Sec. 104, p. 368)50
Cabal v. Kapunan modified the earlier ruling in Almeda, Sr. v. Perez.51 The
Court in Cabal held that the doctrine laid down in Almeda refers to the purely
procedural aspect of the forfeiture proceedings and has no bearing on the
substantial rights of respondents, particularly their constitutional right against
self-incrimination.52 This was reaffirmed and reiterated in
59
Republic v. Agoncillo53 and Katigbak v. Solicitor General.54
The Sandiganbayan is vested with jurisdiction over violations of R.A. No.
1379, entitled "An Act Declaring Forfeiture In Favor of the State Any
Property Found to Have Been Unlawfully Acquired By Any Public Officer or
Employee and Providing For the Proceedings Therefor." What acts would
constitute a violation of such a law? A reading of R.A. No. 1379 establishes
that it does not enumerate any prohibited acts the commission of which
would necessitate the imposition of a penalty. Instead, it provides the
procedure for forfeiture to be followed in case a public officer or employee
has acquired during his incumbency an amount of property manifestly out of
proportion to his salary as such public officer or employee and to his lawful
income and income from legitimately acquired property.55 Section 1256 of the
law provides a penalty but it is only imposed upon the public officer or
employee who transfers or conveys the unlawfully acquired property; it does
not penalize the officer or employee for making the unlawful acquisition. In
effect, as observed in Almeda, Sr. v. Perez, it imposes the penalty of forfeiture
of the properties unlawfully acquired upon the respondent public officer or
employee.57
It is logically congruent, therefore, that violations of R.A. No. 1379 are
placed under the jurisdiction of the Sandiganbayan, even though the
proceeding is civil in nature, since the forfeiture of the illegally acquired
property amounts to a penalty. The soundness of this reasoning becomes even
more obvious when we consider that the respondent in such forfeiture
proceedings is a public officer or employee and the violation of R.A. No.
1379 was committed during the respondent officer or employees
incumbency and in relation to his office. This is in line with the purpose
behind the creation of the Sandiganbayan as an anti-graft courtto address
the urgent problem of dishonesty in public service. 58
Following the same analysis, petitioner should therefore abandon his
erroneous belief that the Sandiganbayan has jurisdiction only over petitions
for forfeiture filed against President Marcos, his family and cronies.
We come then to the question of authority of the Office of the Ombudsman to
investigate, file and
prosecute petitions for forfeiture under R.A. No. 1379. This was the main
issue resolved in Republic v. Sandiganbayan.59
Under Sec. 2 of R.A. No. 1379, it was the Solicitor General who was
authorized to initiate forfeiture proceedings before the then Courts of First
Instance. P.D. No. Decree No. 1486 was later issued on 11 June 1978 vesting
the Sandiganbayan with jurisdiction over R.A. No. 1379 forfeiture
proceedings. Sec. 12 of P.D. No. 1486 gave the Chief Special Prosecutor the
authority to file and prosecute forfeiture cases. This may be taken as an
implied repeal by P.D. No. 1486 of the jurisdiction of the former Courts of
First Instance and the authority of the Solicitor General to file a petition for
forfeiture under Sec. 2 of R.A. No. 1379 by transferring said jurisdiction and
authority to the Sandiganbayan and the Chief Special Prosecutor,
respectively.60 An implied repeal is one which takes place when a new law
contains some provisions which are contrary to, but do not expressly repeal
those of a former law.61 As a rule, repeals by implication are not favored and
will not be so declared unless it be manifest that the legislature so intended.
Before such repeal is deemed to exist, it must be shown that the statutes or
statutory provisions deal with the same subject matter and that the latter be
inconsistent with the former. The language used in the latter statute must be
such as to render it irreconcilable with what had been formerly enacted. An
inconsistency that falls short of that standard does not suffice. What is needed
is a manifest indication of the legislative purpose to repeal. 62
P.D. No. 1486 contains a repealing clause which provides that "[A]ny
provision of law, order, rule or regulation inconsistent with the provisions of
this Decree is hereby repealed or modified accordingly." 63 This is not an
express repealing clause because it fails to identify or designate the statutes
that are intended to be repealed. Rather, it is a clause which predicates the
intended repeal upon the condition that a substantial conflict must be found
in existing and prior laws.64
The conflict between P.D. No. 1486 and R.A. No. 1379 refers to the
jurisdiction over the forfeiture proceeding and the authority to file the
petition for forfeiture. As P.D. No. 1486 grants exclusive jurisdiction and
authority to the Sandiganbayan and the Chief Special Prosecutor, the then
Courts of First Instance and Solicitor General cannot exercise concurrent
jurisdiction or authority over such cases. Hence, P.D. No. 1486 and Sec. 2,
R.A. No. 1379 are inconsistent with each other and the former should be
deemed to have repealed the latter.lawphil.net
On 11 June 1978, the same day that P.D. No. 1486 was enacted, P.D. No.
148765 creating the Office of the Ombudsman (then known as the
Tanodbayan) was passed. The Tanodbayan initially had no authority to
prosecute cases falling within the jurisdiction of the Sandiganbayan as
60
provided in Sec. 4 of P.D. No. 1486, such jurisdiction being vested in the
Chief Special Prosecutor as earlier mentioned.
On 10 December 1978, P.D. No. 1606 was enacted expressly repealing P.D.
No. 1486. Issued on the same date was P.D. No. 160766 which amended the
powers of the Tanodbayan to investigate administrative complaints 67and
created the Office of the Chief Special Prosecutor.68 P.D. No. 1607 provided
said Office of the Chief Special Prosecutor with exclusive authority to
conduct preliminary investigation of all cases cognizable by the
Sandiganbayan, file informations therefor, and direct and control the
prosecution of said cases.69 P.D. No. 1607 also removed from the Chief
Special Prosecutor the authority to file actions for forfeiture under R.A. No.
1379.70
The rule is that when a law which expressly repeals a prior law is itself
repealed, the law first repealed shall not be thereby revived unless expressly
so provided. From this it may fairly be inferred that the old rule continues in
force where a law which repeals a prior law, not expressly but by implication,
is itself repealed; and that in such cases the repeal of the repealing law
revives the prior law, unless the language of the repealing statute provides
otherwise.71 Hence, the repeal of P.D. No. 1486 by P.D. No. 1606 necessarily
revived the authority of the Solicitor General to file a petition for forfeiture
under R.A. No. 1379, but not the jurisdiction of the Courts of First Instance
over the case nor the authority of the Provincial or City Fiscals (now
Prosecutors) to conduct the preliminary investigation therefore, since said
powers at that time remained in the Sandiganbayan and the Chief Special
Prosecutor.72
The Tanodbayans authority was further expanded by P.D. No. 163073 issued
on 18 July 1990. Among other things, the Tanodbayan was given the
exclusive authority to conduct preliminary investigation of all cases
cognizable by the Sandiganbayan, to file informations therefore and to direct
and control the prosecution of said cases.74 The power to conduct the
necessary investigation and to file and prosecute the corresponding criminal
and administrative cases before the Sandiganbayan or the proper court or
administrative agency against any public personnel who has acted in a
manner warranting criminal and disciplinary action or proceedings was also
transferred from the Chief Special Prosecutor to the Tanodbayan. 75
Thereafter, P.D. No. 1606 was amended by P.D. Nos. 1860 and 186176 which
granted the Tanodbayan the same authority. The present Constitution was
subsequently ratified and then the Tanodbayan became known as the Office
of the Special Prosecutor which continued to exercise its powers except those
conferred on the Office of the Ombudsman created under the
Constitution.77 The Office of the Ombudsman was officially created under
R.A. No. 6770.78
At present, the powers of the Ombudsman, as defined by R.A. No. 6770,
corollary to Sec. 13, Art. XI of the Constitution, include the authority, among
others, to:
(1) Investigate and prosecute on its own or on complaint by any person, any
act or omission of any public officer or employee, office or agency, when
such act or omission appears to be illegal, unjust, improper or inefficient. It
has primary jurisdiction over cases cognizable by the Sandiganbayan and, in
the exercise of this primary jurisdiction, may take over, at any stage, from
any investigatory agency of Government, the investigation of such cases; 79
(11) Investigate and initiate the proper action for the recovery of ill-gotten
and/or unexplained wealth amassed after 25 February 1986 and the
prosecution of the parties involved therein.80
Ostensibly, it is the Ombudsman who should file the petition for forfeiture
under R.A. No. 1379. However, the Ombudsmans exercise of the correlative
powers to investigate and initiate the proper action for recovery of ill-gotten
and/or unexplained wealth is restricted only to cases for the recovery of ill-
gotten and/or unexplained wealth amassed after 25 February 1986.81 As
regards such wealth accumulated on or before said date, the Ombudsman is
without authority to commence before the Sandiganbayan such forfeiture
actionsince the authority to file forfeiture proceedings on or before 25
February 1986 belongs to the Solicitor Generalalthough he has the
authority to investigate such cases for forfeiture even before 25 February
1986, pursuant to the Ombudsmans general investigatory power under Sec.
15 (1) of R.A. No. 6770.82
It is obvious then that respondent Office of the Ombudsman acted well
within its authority in conducting the investigation of petitioners illegally
acquired assets and in filing the petition for forfeiture against him. The
contention that the procedural requirements under Sec. 2 of R.A. No. 1379
were not complied with no longer deserve consideration in view of the
foregoing discussion.
61
Now to the charge that petitioner is guilty of forum-shopping. Forum-
shopping is manifest whenever a party "repetitively avail[s] of several
judicial remedies in different courts, simultaneously or successively, all
substantially founded on the same transactions and the same essential facts
and circumstances, and all raising substantially the same issues either
pending in, or already resolved adversely by, some other court." 83 It has also
been defined as "an act of a party against whom an adverse judgment has
been rendered in one forum of seeking and possibly getting a favorable
opinion in another forum, other than by appeal or the special civil action of
certiorari, or the institution of two or more actions or proceedings grounded
on the same cause on the supposition that one or the other court would make
a favorable disposition."84 Considered a pernicious evil, it adversely affects
the efficient administration of justice since it clogs the court dockets, unduly
burdens the financial and human resources of the judiciary, and trifles with
and mocks judicial processes.85 Willful and deliberate forum-shopping is a
ground for summary dismissal of the complaint or initiatory pleading with
prejudice and constitutes direct contempt of court, as well as a cause for
administrative sanctions, which may both be resolved and imposed in the
same case where the forum-shopping is found.86
There is ample reason to hold that petitioner is guilty of forum-shopping. The
present petition was filed accompanied by the requisite Verification and
Certification Against Forum Shopping87 in which petitioner made the
following representation:
. justice. As an officer of the court, his duties to the court are more significant
3.] As Petitioner, I have not heretofore commenced any other action or
proceeding in the Supreme Court, the Court of Appeals, or any other tribunal
or agency, involving the same issues as that in the above-captioned case.
4.] To the best of my knowledge, no such action or proceeding is pending in
the Supreme Court, the Court of Appeals, or any other tribunal or agency.
5.] If I should hereafter learn that such proceeding has been commenced or is
pending before the Supreme Court, the Court of Appeals, or any other
tribunal or agency, I undertake to report that fact to this Honorable Court
within five (5) days from knowledge thereof.
However, petitioner failed to inform the Court that he had filed a Motion to
Dismiss88 in relation to the petition for forfeiture before the Sandiganbayan.
The existence of this motion was only brought to the attention of this Court
by respondent Office of the Ombudsman in its Comment. A scrutiny of
the Motion to Dismiss reveals that petitioner raised substantially the same
issues and prayed for the same reliefs therein as it has in the instant petition.
In fact, the Arguments and Discussion89 in the Petition of petitioners thesis
that the Sandiganbayan has no jurisdiction over separate civil actions for
forfeiture of unlawfully acquired properties appears to be wholly lifted from
the Motion to Dismiss. The only difference between the two is that in
the Petition, petitioner raises the ground of failure of the petition for
forfeiture to comply with the procedural requirements of R.A. No. 1379, and
petitioner prays for the annulment of the Sandiganbayans Resolution dated
29 October 2004 and Writ of Preliminary Attachment dated 2 November
2004. Nevertheless, these differences are only superficial.
BothPetition and Motion to Dismiss have the same intent of dismissing the
case for forfeiture filed against petitioner, his wife and their sons. It is
undeniable that petitioner had failed to fulfill his undertaking. This is
incontestably forum-shopping which is reason enough to dismiss the petition
outright, without prejudice to the taking of appropriate action against the
counsel and party concerned.90 The brazenness of this attempt at forum-
shopping is even demonstrated by the fact that both the Petition and Motion
to Dismiss were filed on the same day, 17 November 2004. Petitioner should
have waited for the resolution of his Motion to Dismiss before resorting to
the petition at hand.
Petitioners counsel of record, Atty. Constantino B. De Jesus, needs to be
reminded that his primary duty is to assist the courts in the administration of
and important than his obligations to his clients. Any conduct which tends to
delay, impede or obstruct the administration thereof contravenes his oath of
office.91 Atty. De Jesus failed to accord due regard, as he must, the tenets of
the legal profession and the mission of our courts of justice. For this, he
should be penalized. Penalties imposed upon lawyers who engaged in forum-
shopping range from severe censure to suspension from the practice of
law.92 In the instant case, we deem the imposition of a fine in the amount
of P20,000.00 to be sufficient to make Atty. De Jesus realize the seriousness
of his naked abuse of the judicial process.
WHEREFORE, in view of the foregoing, the Petition is DISMISSED. Atty.
Constantino B. De Jesus is DECLARED in CONTEMPT of this Court and
meted a fine of Twenty Thousand Pesos (P20,000.00) to be paid within ten
(10) days from the finality of this D E C I S I O N. Costs against petitioner.
Footnotes
62
3
Code of Conduct of Ethical Standards for Public Officials and Employees;
20 February 1989.
4
An Act Declaring Forfeiture In Favor of the State Any Property Found to
Have Been Unlawfully Acquired By Any Public Officer or Employee and
Providing for the Proceedings Therefor; 18 June 1955.
5 11
Based on the same Complaint, Case No. OMB-P-A-04-093501 for
Dishonesty, Grave Misconduct and Conduct Prejudicial to the Best Interest
of the Service was also filed against petitioner. Petitioner further avers that
on 21 October 2004, Atty. Roxas filed another complaint against him with the
same respondent Office of the Ombudsman, charging dishonesty, conduct
unbecoming of a public officer under E.O. No. 292, perjury under Art. 183 of
the Revised Penal Code and violation of R.A. No. 3019. Based on this
complaint, Case No. OMB-P-C-04-1230-J for Violation of Art. 183 of the
Revised Penal Code and Violation of R.A. No. 3019 was filed against
petitioner, his wife, and three sons. Case No. OMB-P-A-04-1030-J was filed
against petitioner alone for Dishonesty, Grave Misconduct, and Conduct
Unbecoming of a Public Officer under E.O. 292. In addition, four
Informations for perjury were also filed with public respondent
Sandiganbayan against petitioner. Rollo, pp. 9-12.
8
Id. at 915-938. At the time of filing of respondent Office of the
Ombudsmans Comment on 7 December 2004, the Motion to Dismiss was
still pending. Id. at 581. At the time of the promulgation of this decision, it
could not be determined from the records if the Motion to Dismiss had
already been resolved.
9
Sec. 2. Filing of petition.Whenever any public officer or employee has
acquired during his incumbency an amount of property which is manifestly
out of proportion to his salary as such public officer or employee and to his
other lawful income and the income from legitimately acquired property, said
property shall be presumed prima facie to have been unlawfully acquired.
The Solicitor General, upon complaint by any taxpayer to the city or
provincial fiscal who shall conduct a previous inquiry similar to preliminary
investigations in criminal cases and shall certify to the Solicitor General that
there is reasonable ground to believe that there has been committed a
violation of this Act and the respondent is probably guilty thereof, shall file,
in the name and on behalf of the Republic of the Philippines, in the Court of
First Instance of the city or province where said public officer or employee
resides or holds office, a petition for a writ commanding said officer or
employee to show cause why the property aforesaid, or any part thereof,
should not be declared property of the State: Provided, That no such petition
shall be filed within one year before any general election or within three
months before any special election.
10
Revising Presidential Decree No. 1486 Creating A Special Court to be
Known As "Sandiganbayan" and For Other Purposes; 10 December 1978.
Defining the Jurisdiction Over Cases Involving the Ill-gotten Wealth of
Former President Ferdinand E. Marcos, Mrs. Imelda R. Marcos, Members of
the Immediate Family, Close Relatives, Subordinates, Close and/or Business
Associates, Dummies, Agents and Nominees; 7 May 1986.
12
Amending Executive Order No. 14; 18 August 1986.
19
Art. XI, Sec. 4: "The present anti-graft court known as the Sandiganbayan
shall continue to function and exercise its jurisdiction as now or hereafter
may be provided by law."
The 1973 Constitution, Art. XIII, Sec. 5, provided for the creation of a
special court known as the Sandiganbayan and defined the jurisdiction
thereof. It states: "The National Assembly shall create a special court,
to be known as Sandiganbayan, which shall have jurisdiction over
criminal and civil cases involving graft and corrupt practices and such
other offenses committed by public officers and employees, including
those in government-owned or controlled corporations, in relation to
their office as may be determined by law."
20
".c. Civil and Criminal cases filed pursuant to and in connection with
Executive Orders Nos. 1, 2, 14, and 14-A, issued in 1986."
23
An Act to Strengthen the Functional and Structural Organization of the
Sandiganbayan, Amending for that Purpose Presidential Decree No. 1606, as
Amended; 30 March 1995.
24
An Act Further Defining the Jurisdiction of the Sandiganbayan, Amending
for the Purpose Presidential Decree No. 1606, as Amended, Providing Funds
Therefor, and for Other Purposes; 5 February 1997.
26
Constitution, Art. XI, Sec. 13, par. (1).
27
The Ombudsman Act of 1989; 17 November 1989.
63
28
"Sec. 15. Powers, Functions and Duties.The Office of the Ombudsman
shall have the following powers, functions and duties: (11) Investigate and
initiate the proper action for the recovery of ill-gotten wealth and/or
unexplained wealth amassed after February 25, 1986 and the prosecution of
the parties involved therein."
34
Creating a Special Court to be Known as "Sandiganbayan" and for Other
Purposes; 11 June 1978.
37
Sec. 4 of P.D. No. 1606 reads:
35
Id., Sec. 4, which reads:
"SECTION 4. Jurisdiction.Except as herein provided, the
Sandiganbayan shall have original and exclusive jurisdiction to try and
decide:
(a) Violations of Republic Act No. 3019, as amended, otherwise
known as the Anti-Graft and Corrupt Practices Act and Republic
Act No. 1379;
(b) Crimes committed by public officers or employees,
including those employed in government-owned or controlled
corporations, embraced in Title VII of the Revised Penal Code;
(c) Other crimes or offenses committed by public officers or
employees including those employed in government-owned or
controlled corporations in relation to their office; Provided, that,
in case private individuals are accused as principals,
accomplices or accessories in the commission of the crimes
hereinabove mentioned, they shall be tried jointly with the
public officers or employees concerned.
Where the accused is charged of an offense in relation to his
office and the evidence is insufficient to establish the offense so
charged, he may nevertheless be convicted and sentenced for the
offense included in that which is charged.
(d) Civil suits brought in connection with the aforementioned
crimes for restitution or reparation of damages, recovery of the
instruments and effects of the crimes, or forfeiture proceedings
provided for under Republic Act No. 1379;
(e) Civil actions brought under Articles 32 and 34 of the Civil
Code.
Exception from the foregoing provisions during the period of material
law are criminal cases against officers and members of the Armed
Forces of the Philippines, and all others who fall under the exclusive
jurisdiction of the military tribunals."
"SECTION 4. Jurisdiction. The Sandiganbayan shall have
jurisdiction over:
(a) Violations of Republic Act No. 3019, as amended, otherwise,
known as the Anti-Graft and Corrupt Practices Act, and
Republic Act No. 1379;
(b) Crimes committed by public officers and employees
including those employed in government-owned or controlled
corporations, embraced in Title VII of the Revised Penal Code,
whether simple or complexed with other crimes; and
(c) Other crimes or offenses committed by public officers or
employees, including those employed in government-owned or
controlled corporations, in relation to their office.
The jurisdiction herein conferred shall be original and exclusive if the
offense charged is punishable by a penalty higher than prision
correccional, or its equivalent, except as herein provided; in other
offenses, it shall be concurrent with the regular courts.
In case private individuals are charged as co-principals, accomplices or
accessories with the public officers or employees including those
employed in government-owned or controlled corporations, they shall
be tried jointly with said public officers and employees.
Where an accused is tried for any of the above offenses and the
evidence is insufficient to establish the offense charged, he may
nevertheless be convicted and sentenced for the offense proved,
included in that which is charged.
64
 Any provision of law or the Rules of Court to the contrary
notwithstanding, the criminal action and the corresponding civil action
for the recovery of civil liability arising from the offense charged shall
at all times be simultaneously instituted with, and jointly determined in
the same proceeding by, the Sandiganbayan, the filing of the criminal
action being deemed to necessarily carry with it the filing of the civil
action, and no right to reserve the filing of such action shall be
recognized; Provided, however, that, in cases within the exclusive
jurisdiction of the Sandiganbayan, where the civil action had
theretofore been filed separately with a regular court but judgment
therein has not yet been rendered and the criminal case is hereafter
filed with the Sandiganbayan, said civil action shall be transferred to
the Sandiganbayan for consolidation and joint determination with the
criminal action, otherwise, the criminal action may no longer be filed
with the Sandiganbayan, its exclusive jurisdiction over the same
notwithstanding, but may be filed and prosecuted only in the regular
courts of competent jurisdiction; Provided, further, that, in cases within
the concurrent jurisdiction of the Sandiganbayan and the regular
courts, where either the criminal or civil action is first filed with the
regular courts, the corresponding civil or criminal action, as the case
may be, shall only be filed with the regular courts of competent
jurisdiction.
Excepted from the foregoing provisions, during martial law, are
criminal cases against officers and members of the armed forces in the
active service.
39
The Judiciary Reorganization Act of 1980; 14 August 1981. Sec. 20 thereof
provides: "Sec. 20. Jurisdiction in criminal cases. - Regional Trial Courts
shall exercise exclusive original jurisdiction in all criminal cases not within
the exclusive jurisdiction of any court, tribunal or body, except those now
falling under the exclusive and concurrent jurisdiction of the Sandiganbayan
which shall hereafter be exclusively taken cognizance of by the latter."
40
Amending the Pertinent Provisions of Presidential Decree No. 1606 and
Batas Pambansa Blg. 129 Relative to the Jurisdiction of the Sandiganbayan
and for Other Purposes; 14 January 1983. Sec. 1 thereof reads:
"SECTION 1. Section 4 of Presidential Decree No. 1606 is hereby
amended to read as follows:
"Sec. 4. Jurisdiction. The Sandiganbayan shall have jurisdiction
over:
"(a) Violations of Republic Act No. 3019, as amended,
otherwise known as the Anti-Graft and Corrupt Practices Act,
and Republic Act No. 1379;
"(b) Crimes committed by public officers and employees,
including those employed in government-owned or controlled
corporations, embraced in Title VII of the Revised Penal Code,
whether simple or complexed with other crimes; and
"(c) Other crimes or offenses committed by public officers or
employees, including those employed in government-owned or
controlled corporations, in relation to their office.
"The jurisdiction herein conferred shall be original and exclusive if the
offense charged is punishable by a penalty higher than prision
correccional or its equivalent. In all other offenses, original and
exclusive jurisdiction shall vest in the appropriate court in accordance
with the provisions of Batas Pambansa Blg. 129.
"In case private individuals are charged as co-principals, accomplices
or accessories together with the public officers or employees, including
those employed in government-owned or controlled corporations, they
shall be tried jointly with said public officers and employees.
"Where an accused is tried of any of the above offenses and the
evidence is insufficient to establish the offense charged, he may
nevertheless be convicted of and sentenced for the offense proved,
included in that which is charged.
"Any provision of law or the Rules of Court to the contrary
notwithstanding, the criminal action and the corresponding civil action
for the recovery of civil liability arising from the offense charged shall
at all times be simultaneously instituted with, and jointly determined in
the same proceeding by, the Sandiganbayan or the appropriate court.
The filing of the criminal action shall be deemed to necessarily carry
with it the filing of the civil action, and no right to reserve the filing of
such civil action separately from the criminal action shall be
recognized; PROVIDED, however, That, in cases within the exclusive
65
original jurisdiction of the Sandiganbayan, where the civil action had
been filed separately with a regular court but judgment therein has not
been rendered and the criminal case is hereafter filed with the
Sandiganbayan, said civil action shall be transferred to the
Sandiganbayan for consolidation and joint determination with the
criminal action, otherwise, the criminal action may no longer be filed
with the Sandiganbayan, its exclusive jurisdiction over the same
notwithstanding, but may be filed and prosecuted only in the regular
courts of competent jurisdiction."
41
Amending the Pertinent Provisions of Presidential Decree No. 1606
and Batas Pambansa Blg. 129 Relative to the Jurisdiction of the
Sandiganbayan and for Other Purposes; 23 March 1983. Section 1
thereof states:
SECTION 1. Section 4 of Presidential Decree No. 1606 is
hereby amended to read as follows:
"Sec. 4. Jurisdiction. The Sandiganbayan shall exercise:
"(a) Exclusive original jurisdiction in all cases involving:
(1) Violations of Republic Act No. 3019, as
amended, otherwise known as the Anti-Graft and
Corrupt Practices Act, Republic Act No. 1379, and
Chapter II, Section 2, Title VII of the Revised Penal
Code;
(2) Other offenses or felonies committed by public
officers and employees in relation to their office,
including those employed in government-owned or
controlled corporations, whether simple or
complexed with other crimes, where the penalty
prescribed by law is higher than prision
correccional or imprisonment for six (6) years, or a
fine of P6,000.00: PROVIDED, HOWEVER, that
offenses or felonies mentioned in this paragraph
where the penalty prescribed by law does not
exceed prision correccional or imprisonment for six
(6) years or a fine ofP6,000.00 shall be tried by the
proper Regional Trial Court, Metropolitan Trial
Court, Municipal Trial Court and Municipal Circuit
Trial Court.
"(b) Exclusive appellate jurisdiction:
(1) On appeal, from the final judgments, resolutions
or orders of the Regional Trial Courts in cases
originally decided by them in their respective
territorial jurisdiction.
(2) By petition for review, from the final
judgments, resolutions or orders of the Regional
Trial Courts in the exercise of their appellate
jurisdiction over cases originally decided by the
Metropolitan Trial Courts, Municipal Trial Courts
and Municipal Circuit Trial Courts, in their
respective jurisdiction.
"The procedure prescribed in Batas Pambansa Blg. 129, as well
as the implementing rules the Supreme Court has promulgated
and may hereinafter promulgate, relative to appeals/petitions for
review to the Intermediate Appellate Court shall apply to
appeals and petitions for review filed with the Sandiganbayan.
In all cases elevated to the Sandiganbayan, the Office of the
Tanodbayan shall represent the People of the Philippines.
"In case private individuals are charged as co-principals,
accomplices or accessories with the public officers or
employees, including those employed in government-owned or
controlled corporations, they shall be tried jointly with said
public officers and employees.
"Any provision of law or the Rules of Court to the contrary
notwithstanding, the criminal action and the corresponding civil
action for the recovery of civil liability arising from the offense
charged shall at all times be simultaneously instituted with, and
jointly determined in the same proceeding by the Sandiganbayan
or the appropriate courts, the filing of the criminal action being
deemed to necessarily carry with it the filing of the civil action,
and no right to reserve the filing of such civil action separately
from the criminal action shall be recognized: PROVIDED,
HOWEVER, that where the civil action had heretofore been
66
 filed separately but judgment therein has not yet been rendered,
and the criminal case is hereafter filed with the Sandiganbayan
or the appropriate court, said civil action shall be transferred to
the Sandiganbayan or the appropriate court, as the case maybe,
for consolidation and joint determination with the criminal
action, otherwise the separate civil action shall be considered
abandoned."
55
See Sec. 2, R.A. 1379, supra note 9.
56
"SECTION 12. Penalties.Any public officer or employee who shall, after
the effective date of this Act, transfer or convey any unlawfully acquired
property shall be repressed with imprisonment for a term not exceeding five
years, or a fine not exceeding ten thousand pesos, or both such imprisonment
and fine. The same repression shall be imposed upon any person who shall
knowingly accept such transfer or conveyance."
58
See 1973 Constitution, Art. XIII, Sec. 5, supra note 19. See also Nuez v.
Sandiganbayan, 197 Phil. 407, 420-421 (1982).
63
P.D. No. 1486, Sec. 16.
65
Creating The Office Of The Ombudsman, To Be Known As Tanodbayan.
66
Revising Presidential Decree No. 1487 Creating The Office Of The
Ombudsman, To Be Known As Tanodbayan.
67
"Sec. 10. Powers. The Tanodbayan shall have the following powers:
(a) He may investigate, on complaint by any person or on his own
motion or initiative, any administrative act whether amounting to any
criminal offense or not of any administrative agency including any
government-owned or controlled corporation;
(b) He shall prescribe the methods by which complaints are to be
made, received, and acted upon; he may determine the scope and
manner of investigations to be made; and, subject to the requirements
of this Decree, he may determine the form, frequency, and distribution
of his conclusions and recommendations;
(c) He may request and shall be given by each administrative agency
the assistance and information he deems necessary to the discharge of
his responsibilities; he may examine the records and documents of all
administrative agencies; and he may enter and inspect premises within
any administrative agency's control, provided, however, that where the
President in writing certifies that such information, examination or
inspection might prejudice the national interest, the Tanodbayan shall
desist. All information so obtained shall be confidential, unless the
President, in the interest of public service, decides otherwise;
(d) He may issue a subpoena to compel any person to appear, give
sworn to testimony, or produce documentary or other evidence the
Tanodbayan deems relevant to a matter under his inquiry;
(e) He may undertake, participate in, cooperate with general studies or
inquiries, whether or not related to any particular administrative
agency or any particular administrative act; if he believes that they
may enhance knowledge about or lead to improvements in the
functioning of administrative agencies."
68
"Sec. 17. Office of the Chief Special Prosecutor. There is hereby created
in the Office of the Tanodbayan an Office of the Chief Special Prosecutor
composed of a Chief Special Prosecutor, an Assistant Chief Special
Prosecutor, and nine (9) Special Prosecutors, who shall have the same
qualifications as provincial and city fiscals and who shall be appointed by the
President; .
The Chief Special Prosecutor, the Assistant Chief Special Prosecutor,
and the Special Prosecutors shall have the exclusive authority to
conduct preliminary investigation of all cases cognizable by the
Sandiganbayan; to file informations thereof and to direct and control
the prosecution of said cases therein; .
The Chief Special Prosecutor, Assistant State Prosecutor, Special
Prosecutor and those designated to assist them as herein provided for
shall be under the control and supervision of the Tanodbayan and their
resolutions and actions shall not be subject to review by any
administrative agency."
.
67
 86
Sec. 19. Prosecution of Public Personnel or Other person.If the Rule 7, Sec. 5, Revised Rules of Civil Procedure; Top Rate Construction
Tanodbayan has reason to believe that any public official, employee, or and General Services, Inc. v. Paxton Development Corporation, G.R. No.
other person has acted in a manner warranting criminal or disciplinary 151081, 11 September 2003, 410 SCRA 604, 620-621.
action or proceedings, he shall cause him to be investigated by the
Office of the Chief Special Prosecutor who shall file and prosecute the
corresponding criminal or administrative case before the
Sandiganbayan or the proper court or before the proper administrative
agency. In case of failure of justice, the Sandiganbayan shall make the
appropriate recommendations to the administrative agency concerned."

70
Id. On the premise that a forfeiture proceeding under R.A. No. 1379 is a
civil action in rem.

73
Further Revising Presidential Decree No. 1487, As Revised By Presidential
Decree No. 1607, Creating The Office Of The Tanodbayan.

74
P.D. No. 1630, Sec. 17: "Sec. 17. Investigation and Prosecution of Cases.
The Office of the Tanodbayan shall have the exclusive authority to conduct
preliminary investigation of all cases cognizable by the Sandiganbayan; to
file information therefor and to direct and control the prosecution of said
cases. The Tanodbayan may utilize the personnel of his office and/or with the
approval of the President, designate or deputize any fiscal, state prosecutor or
lawyer in the government service to act as special investigator or prosecutor
to assist him in the investigation and prosecution of said cases. Those
designated or deputized to assist him as herein provided shall be under his
supervision and control.

75
"Sec. 18. Prosecution of Public Personnel or Other Person.If the
Tanodbayan has reason to believe that any public official, employee, or other
person has acted in a manner warranting criminal or disciplinary action or
proceedings, he shall conduct the necessary investigation and shall file and
prosecute the corresponding criminal or administrative case before the
Sandiganbayan or the proper court or before the proper administrative
agency."

77
Art. XI, Sec. 7.

79
R.A. No. 6770, Sec. 15(1).

68
19. FELIPE N. MADRIAN v. RANCISCA R. MADRIAN
G.R. No. 159374 July 12, 2007
Republic Act No. 8369

When a family breaks up, the children are always the victims. The ensuing
battle for custody of the minor children is not only a thorny issue but also a
highly sensitive and heart-rending affair. Such is the case here. Even the
usually technical subject of jurisdiction became emotionally charged.

Petitioner Felipe N. Madrian and respondent Francisca R. Madrian were

married on July 7, 1993 in Paraaque City. They resided in San Agustin
Village, Brgy. Moonwalk, Paraaque City.

Their union was blessed with three sons and a daughter: Ronnick, born on
January 30, 1994; Phillip, born on November 19, 1996; Francis Angelo, born
on May 12, 1998 and Krizia Ann, born on December 12, 2000.

After a bitter quarrel on May 18, 2002, petitioner allegedly left their conjugal
abode and took their three sons with him to Ligao City, Albay and
subsequently to Sta. Rosa, Laguna. Respondent sought the help of her parents
and parents-in-law to patch things up between her and petitioner to no avail.
She then brought the matter to theLupong Tagapamayapa in their barangay
but this too proved futile.

Thus respondent filed a petition for habeas corpus of Ronnick, Phillip and
Francis Angelo in the Court of Appeals, alleging that petitioners act of
leaving the conjugal dwelling and going to Albay and then to Laguna
disrupted the education of their children and deprived them of their mothers
care. She prayed that petitioner be ordered to appear and produce their sons
before the court and to explain why they should not be returned to her
custody.

Petitioner and respondent appeared at the hearing on September 17, 2002.

They initially agreed that petitioner would return the custody of their three
sons to respondent. Petitioner, however, had a change of heart 1 and decided
to file a memorandum.

On September 3, 2002, petitioner filed his memorandum2 alleging that

respondent was unfit to take custody of their three sons because she was
habitually drunk, frequently went home late at night or in the wee hours of
the morning, spent much of her time at a beer house and neglected her duties

69
as a mother. He claimed that, after their squabble on May 18, 2002, it was
respondent who left, taking their daughter with her. It was only then that he
went to Sta. Rosa, Laguna where he worked as a tricycle driver. He submitted
a certification from the principal of the Dila Elementary School in Sta. Rosa,
Laguna that Ronnick and Phillip were enrolled there. He also questioned the
jurisdiction of the Court of Appeals claiming that under Section 5(b) of RA
8369 (otherwise known as the "Family Courts Act of 1997") family courts
have exclusive original jurisdiction to hear and decide the petition for habeas
corpus filed by respondent.3
For her part, respondent averred that she did not leave their home on May 18,
2002 but was driven out by petitioner. She alleged that it was petitioner who
was an alcoholic, gambler and drug addict. Petitioners alcoholism and drug
addiction impaired his mental faculties, causing him to commit acts of
violence against her and their children. The situation was aggravated by the
fact that their home was adjacent to that of her in-laws who frequently
meddled in their personal problems.4
On October 21, 2002, the Court of Appeals5 rendered a decision6 asserting its
authority to take cognizance of the petition and ruling that, under Article 213
of the Family Code, respondent was entitled to the custody of Phillip and
Francis Angelo who were at that time aged six and four, respectively, subject
to the visitation rights of petitioner. With respect to Ronnick who was then
eight years old, the court ruled that his custody should be determined by the
proper family court in a special proceeding on custody of minors under Rule
99 of the Rules of Court.
Petitioner moved for reconsideration of the Court of Appeals decision but it
was denied. Hence, this recourse.
Petitioner challenges the jurisdiction of the Court of Appeals over the petition
for habeas corpus and insists that jurisdiction over the case is lodged in the
family courts under RA 8369. He invokes Section 5(b) of RA 8369:
Section 5. Jurisdiction of Family Courts. The Family Courts shall have
exclusive original jurisdiction to hear and decide the following cases:
xxx xxx xxx
b) Petitions for guardianship, custody of children, habeas corpus in relation
to the latter;
xxx xxx xxx
Petitioner is wrong.
In Thornton v. Thornton,7 this Court resolved the issue of the Court of
Appeals jurisdiction to issue writs ofhabeas corpus in cases involving
custody of minors in the light of the provision in RA 8369 giving family
courts exclusive original jurisdiction over such petitions:
The Court of Appeals should take cognizance of the case since there is
nothing in RA 8369 that revoked its jurisdiction to issue writs of habeas
corpus involving the custody of minors.
xxx xxx xxx
We rule therefore that RA 8369 did not divest the Court of Appeals and
the Supreme Court of their jurisdiction over habeas corpus cases
involving the custody of minors.
xxx xxx xxx
The provisions of RA 8369 reveal no manifest intent to revoke the
jurisdiction of the Court of Appeals and Supreme Court to issue writs
of habeas corpus relating to the custody of minors. Further, it cannot be said
that the provisions of RA 8369, RA 7092 [An Act Expanding the Jurisdiction
of the Court of Appeals] and BP 129 [The Judiciary Reorganization Act of
1980] are absolutely incompatible since RA 8369 does not prohibit the Court
of Appeals and the Supreme Court from issuing writs of habeas corpus in
cases involving the custody of minors. Thus, the provisions of RA 8369 must
be read in harmony with RA 7029 and BP 129 that family courts have
concurrent jurisdiction with the Court of Appeals and the Supreme
Court in petitions for habeas corpuswhere the custody of minors is at
issue.8 (emphases supplied)
The jurisdiction of the Court of Appeals over petitions for habeas corpus was
further affirmed by A.M. No. 03-03-04-SC (April 22, 2004) in Re: Rule on
Custody of Minors and Writ of Habeas Corpus in Relation to Custody of
Minors:
In any case, whatever uncertainty there was has been settled with the
adoption of A.M. No. 03-03-04-SC Re: Rule on Custody of Minors and
70
Writ of Habeas Corpus in Relation to Custody of Minors. Section 20 of
the rule provides that:
Section 20. Petition for writ of habeas corpus. A verified petition for a writ
of habeas corpus involving custody of minors shall be filed with the Family
Court. The writ shall be enforceable within its judicial region to which the
Family Court belongs.
xxx xxx xxx
The petition may likewise be filed with the Supreme Court, Court of
Appeals, or with any of its membersand, if so granted, the writ shall be
enforceable anywhere in the Philippines. The writ may be made returnable
to a Family Court or to any regular court within the region where the
petitioner resides or where the minor may be found for hearing and decision
on the merits.
From the foregoing, there is no doubt that the Court of Appeals and
Supreme Court have concurrent jurisdiction with family courts
in habeas corpus cases where the custody of minors is
involved.9(emphases supplied)1avvphi1
Moreover, a careful reading of Section 5(b) of RA 8369 reveals that family
courts are vested with original exclusive jurisdiction in custody cases, not
in habeas corpus cases. Writs of habeas corpus which may be issued
exclusively by family courts under Section 5(b) of RA 8369 pertain to
the ancillary remedy that may be availed of in conjunction with a petition
for custody of minors under Rule 99 of the Rules of Court. In other words,
the issuance of the writ is merely ancillary to the custody case pending before
the family court. The writ must be issued by the same court to avoid splitting
of jurisdiction, conflicting decisions, interference by a co-equal court and
judicial instability.
The rule therefore is: when by law jurisdiction is conferred on a court or
judicial officer, all auxiliary writs, processes and other means necessary to
carry it into effect may be employed by such court or officer.11 Once a court
acquires jurisdiction over the subject matter of a case, it does so to the
exclusion of all other courts, including related incidents and ancillary
matters.
Accordingly, the petition is hereby DENIED. Costs against petitioner.
Footnotes

We note that after petitioner moved out of their Paraaque residence on May 1 Both parties accused each others parents of constant meddling in their
18, 2002, he twice transferred his sons to provinces covered by different family life.
judicial regions. This situation is what the Thornton interpretation of RA
8369s provision on jurisdiction precisely addressed: 11 Section 6, Rule 135, Rules of Court.

[The reasoning that by giving family courts exclusive jurisdiction

over habeas corpus cases, the lawmakers intended them to be the sole courts
which can issue writs of habeas corpus] will result in an iniquitous situation,
leaving individuals like [respondent] without legal recourse in obtaining
custody of their children. Individuals who do not know the whereabouts of
minors they are looking for would be helpless since they cannot seek redress
from family courts whose writs are enforceable only in their respective
territorial jurisdictions. Thus, if a minor is being transferred from one
place to another, which seems to be the case here, the petitioner in
a habeas corpus case will be left without legal remedy. This lack of
recourse could not have been the intention of the lawmakers when they
passed [RA 8369].10

71
20. ERIC JONATHAN YU v. CAROLINE T. YU
G.R. No. 164915 March 10, 2006
Republic Act No. 8369

On January 11, 2002, Eric Jonathan Yu (petitioner) filed a petition for habeas
corpus before the Court of Appeals alleging that his estranged wife Caroline
Tanchay-Yu (respondent) unlawfully withheld from him the custody of their
minor child Bianca. The petition, which included a prayer for the award to
him of the sole custody of Bianca, was docketed as CA-G.R. SP No. 68460.

Subsequently or on March 3, 2002, respondent filed a petition against

petitioner before the Pasig Regional Trial Court (RTC) for declaration of
nullity of marriage and dissolution of the absolute community of property.
The petition included a prayer for the award to her of the sole custody of
Bianca and for the fixing of schedule of petitioners visiting rights "subject
only to the final and executory judgment of the Court of Appeals in CA-G.R.
SP No. 68460."

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In the meantime, the appellate court, by Resolution of March 21, 2002,
awarded petitioner full custody of Bianca during the pendency of the habeas
corpus case, with full visitation rights of respondent.
Petitioner and respondent later filed on April 5, 2002 before the appellate
court a Joint Motion to Approve Interim Visitation Agreement which was, by
Resolution of April 24, 2002, approved.
On April 18, 2002, respondent filed before the appellate court a Motion for
the Modification of her visiting rights under the Interim Visitation
Agreement. To the Motion, petitioner filed an Opposition with Motion to Cite
Respondent for Contempt of Court in light of her filing of the petition for
declaration of nullity of marriage before the Pasig RTC which, so he
contended, constituted forum shopping.
By Resolution of July 5, 2002, the appellate court ordered respondent and her
counsel to make the necessary amendment in her petition for declaration of
nullity of marriage before the Pasig City RTC in so far as the custody aspect
is concerned, under pain of contempt.
In compliance with the appellate courts Resolution of July 5, 2002,
respondent filed a Motion to Admit Amended Petition before the Pasig RTC.
She, however, later filed in December 2002 a Motion to Dismiss her petition,
without prejudice, on the ground that since she started residing and
conducting business at her new address at Pasay City, constraints on
resources and her very busy schedule rendered her unable to devote the
necessary time and attention to the petition. The Pasig RTC granted
respondents motion and accordingly dismissed the petition without
prejudice, by Order of March 28, 2003.
On June 12, 2003, petitioner filed his own petition for declaration of nullity
of marriage and dissolution of the absolute community of property before the
Pasig RTC, docketed as JDRC Case No. 6190, with prayer for the award to
him of the sole custody of Bianca, subject to the final resolution by the
appellate court of his petition for habeas corpus.
The appellate court eventually dismissed the habeas corpus petition, by
Resolution of July 3, 2003, for having become moot and academic, "the
restraint on the liberty of the person alleged to be in restraint [having been]
lifted."
In the meantime, respondent filed on July 24, 2003 before the Pasay RTC a
petition for habeas corpus, which she denominated as "Amended Petition,"
praying for, among other things, the award of the sole custody to her of
Bianca or, in the alternative, pending the hearing of the petition, the issuance
of an order "replicating and reiterating the enforceability of the Interim
Visiting Agreement" which was approved by the appellate court. The petition
was docketed as SP Proc. No. 03-0048.
Not to be outdone, petitioner filed on July 25, 2003 before the Pasig RTC in
his petition for declaration of nullity of marriage an urgent motion praying
for the custody of Bianca for the duration of the case.
Acting on respondents petition, Branch 113 of the Pasay RTC issued a Writ
of Habeas Corpus, a Hold Departure Order and Summons addressed to
petitioner, drawing petitioner to file a motion to dismiss the petition on the
ground of lack of jurisdiction, failure to state a cause of action, forum
shopping and litis pendentia, he citing the pending petition for declaration of
nullity of marriage which he filed before the Pasig RTC.
The Pasay RTC, in the meantime, issued an Order of August 12, 2003
declaring that pending the disposition of respondents petition, Bianca should
stay with petitioner from Sunday afternoon to Saturday morning and "with
the company of her mother from Saturday 1:00 in the afternoon up to Sunday
1:00 in the afternoon." To this Order, petitioner filed a Motion for
Reconsideration, arguing that the Pasay RTC did not have jurisdiction to
issue the same. He likewise filed a Manifestation of August 14, 2003 stating
that he was constrained to submit to the said courts order but with the
reservation that he was not submitting the issue of custody and himself to its
jurisdiction.
Respondent soon filed her Answer with Counter-Petition on the nullity case
before the Pasig RTC wherein she also prayed for the award of the sole
custody to her of Bianca, subject to the final disposition of the habeas corpus
petition which she filed before the Pasay RTC.
By Omnibus Order of October 30, 2003, the Pasig RTC asserted its
jurisdiction over the custody aspect of the petition filed by petitioner and
directed the parties to comply with the provisions of the Interim Visitation
Agreement, unless they agreed to a new bilateral agreement bearing the
approval of the court; and granted custody of Bianca to petitioner for the
duration of the case.
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The Pasay RTC in the meantime denied, by Order of November 27, 2003,
petitioners motion to dismiss. The court, citing Sombong v. Court of
Appeals,1 held that in custody cases involving minors, the question of illegal
and involuntary restraint of liberty is not the underlying rationale for the
availability of a writ of habeas corpus as a remedy; rather, a writ of habeas
corpus is prosecuted for the purpose of determining the right of custody over
the child.2 And it further held that the filing before it of the habeas corpus
case by respondent, who is a resident of Pasay, is well within the ambit of the
provisions of A.M. No. 03-04-04-SC.3
On the issue of forum shopping, the Pasay RTC held that it is petitioner, not
respondent, who committed forum shopping, he having filed (on June 12,
2003) the petition for declaration of nullity of marriage before the Pasig RTC
while his petition for habeas corpus before the Court of Appeals was still
pending.4
The Pasay RTC held that assuming arguendo that petitioners filing before
the Pasig RTC of the declaration of nullity of marriage case did not constitute
forum shopping, it (the Pasay RTC) acquired jurisdiction over the custody
issue ahead of the Pasig RTC, petitioner not having amended his petition
before the Pasig RTC as soon as the Court of Appeals dismissed his petition
for habeas corpus5 (on July 3, 2003).
Finally, the Pasay RTC held that there was no litis pendentia because two
elements thereof are lacking, namely, 1) identity of the rights asserted and
reliefs prayed for, the relief being founded on the same facts, and 2) identity
with respect to the two preceding particulars in the two cases such that any
judgment that may be rendered in the pending case, regardless of which party
is successful, would amount to res judicata in the other case.6
Petitioner thereupon assailed the Pasay RTCs denial of his Motion to
Dismiss via Petition for Certiorari, Prohibition and Mandamus before the
appellate court wherein he raised the following issues:
A. RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF
DISCRETION BY DENYING PETITIONERS MOTION TO
DISMISS DESPITE THE EVIDENT LACK OF JURISDICTION
OVER THE SUBJECT MATTER OF CUSTODY, LITIS
PENDENTIA, AND DELIBERATE AND WILLFUL FORUM-
SHOPPING ON THE PART OF RESPONDENT CAROLINE T.
YU.7
B. RESPONDENT JUDGE ACTED WHIMSICALLY,
CAPRICIOUSLY AND ARBITRARILY IN ISSUING THE
AUGUST 12, 2003 ORDER GRANTING RESPONDENT
CAROLINE T. YU OVERNIGHT VISITATION RIGHTS OVER
THE MINOR CHILD BIANCA AND DENYING PETITIONERS
URGENT MOTION FOR RECONSIDERATION OF THE SAID
ORDER.8 (Underscoring supplied)
By Decision of August 10, 2004,9 the appellate court denied petitioners
petition, it holding that the assumption of jurisdiction by the Pasay RTC over
the habeas corpus case does not constitute grave abuse of discretion; the
filing by respondent before the Pasay RTC of a petition for habeas corpus
could not be considered forum shopping in the strictest sense of the word as
before she filed it after petitioners petition for habeas corpus filed before the
appellate court was dismissed; and it was petitioner who committed forum
shopping when he filed the declaration of nullity of marriage case while his
habeas corpus petition was still pending before the appellate court.
In fine, the appellate court held that since respondent filed the petition for
declaration of nullity of marriage before the Pasig RTC during the pendency
of the habeas corpus case he filed before the appellate court, whereas
respondent filed the habeas corpus petition before the Pasay RTC on July 24,
2003 after the dismissal on July 3, 2003 by the appellate court of petitioners
habeas corpus case, jurisdiction over the issue custody of Bianca did not
attach to the Pasig RTC.
As for the questioned order of the Pasay RTC which modified the Interim
Visiting Agreement, the appellate court, noting that the proper remedy for the
custody of Bianca was filed with the Pasay RTC, held that said court had the
authority to issue the same.
Hence, the present petition filed by petitioner faulting the appellate court for
I. . . . DECLARING THAT PETITIONER ERIC YU COMMITTED
FORUM-SHOPPING IN FILLING THE PETITION FOR DECLARATION
OF NULLITY OF MARRIAGE WITH PRAYER FOR CUSTODY
BEFORE THE PASIG FAMILY COURT AND THAT THE LATTER
COURT WAS BARRED FROM ACQUIRING JURISDICTION OVER THE
CUSTODY ASPECT OF THE NULLITY CASE IN RECKLESS
DISREGARD OF THE PRINCIPLE THAT THE FILING OF A PETITION
FOR NULLITY OF MARRIAGE BEFORE THE FAMILY COURTS
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VESTS THE LATTER WITH EXCLUSIVE JURISDICTION TO
DETERMINE THE NECESSARY ISSUE OF CUSTODY.
II. . . . APPL[YING] THE LAW OF THE CASE DOCTRINE BY RULING
THAT THE PASIG FAMILY COURT HAS NO JURISDICTION OVER
THE CUSTODY ASPECT OF THE NULLITY CASE ON THE BASIS OF
THE JULY 5, 2002 RESOLUTION OF THE COURT OF APPEALS IN CA
GR SP NO. 68460 WHEN THE SAID RESOLUTION CLEARLY APPLIES
ONLY TO THE NULLITY CASE FILED BY PRIVATE RESPONDENT ON
MARCH 7, 2002 DOCKETED AS JDRC CASE NO. 5745 AND NOT TO
HEREIN PETITIONERS JUNE 12, 2003 PETITION FOR NULLITY
DOCKETED AS JDRC CASE NO. 6190.
III. . . . DECLARING THAT THE PASIG FAMILY COURT MUST YIELD
TO THE JURISDICTION OF THE PASAY COURT INSOFAR AS THE
ISSUE OF CUSTODY IS CONCERNED IN GRAVE VIOLATION OF THE
DOCTRINE OF JUDICIAL STABILITY AND NON-INTERFERENCE.
IV. . . . RULING THAT PRIVATE RESPONDENT CAROLINE DID NOT
COMMIT FORUM-SHOPING IN FILING THE HABEAS CORPUS CASE
WITH PRAYER FOR CUSTODY BEFORE THE RESPONDENT PASAY
COURT DESPITE THE FACT THAT AN EARLIER FILED PETITION
FOR DECLARATION OF NULLITY OF MARRIAGE WITH PRAYER
FOR CUSTODY IS STILL PENDING BEFORE THE PASIG FAMILY
COURT WHEN THE FORMER CASE WAS INSTITUTED.
V. . . . RULING THAT RESPONDENT CAROLINE YU DID NOT
SUBMIT TO THE JURISDICTION OF THE PASIG FAMILY
COURT BASED ON AN ERRONEOUS FACTUAL FINDING THAT SHE
FILED ON AUGUST 25, 2003 AN OMNIBUS OPPOSITION IN
PETITIONERS ACTION FOR NULLITY BEFORE THE PASIG
COURT.10 (Underscoring supplied)
The petition is impressed with merit.
The main issue raised in the present petition is whether the question of
custody over Bianca should be litigated before the Pasay RTC or before the
Pasig RTC.
Judgment on the issue of custody in the nullity of marriage case before the
Pasig RTC, regardless of which party would prevail, would constitute res
judicata on the habeas corpus case before the Pasay RTC since the former
has jurisdiction over the parties and the subject matter.
There is identity in the causes of action in Pasig and Pasay because there is
identity in the facts and evidence essential to the resolution of the identical
issue raised in both actions11 whether it would serve the best interest of
Bianca to be in the custody of petitioner rather than respondent or vice versa.
Since the ground invoked in the petition for declaration of nullity of marriage
before the Pasig RTC is respondents alleged psychological incapacity to
perform her essential marital obligations12 as provided in Article 36 of the
Family Code, the evidence to support this cause of action necessarily
involves evidence of respondents fitness to take custody of Bianca. Thus, the
elements of litis pendentia, to wit: a) identity of parties, or at least such as
representing the same interest in both actions; b) identity of rights asserted
and reliefs prayed for, the relief being founded on the same facts; and c) the
identity in the two cases should be such that the judgment that may be
rendered in the pending case would, regardless of which party is successful,
amount to res judicata in the other,13 are present.
Respondent argues in her Comment to the petition at bar that the Pasig RTC
never acquired jurisdiction over the custody issue raised therein.
"[T]he subsequent dismissal of the habeas corpus petition by the Court of
Appeals on 3 July 2003 could not have the effect of conferring jurisdiction
over the issue on the Pasig court. For the Pasig court to acquire jurisdiction
over the custody issue after the dismissal of the habeas corpus petition before
the Court of Appeals, the rule is that petitioner must furnish the occasion for
the acquisition of jurisdiction by repleading his cause of action for custody
and invoking said cause anew."14 (Emphasis and underscoring supplied)
And respondent cites Caluag v. Pecson,15 wherein this Court held:
Jurisdiction of the subject matter of a particular case is something more than
the general power conferred by law upon a court to take cognizance of cases
of the general class to which the particular case belongs. It is not enough that
a court has power in abstract to try and decide the class litigations [sic] to
which a case belongs; it is necessary that said power be properly invoked, or
called into activity, by the filing of a petition, or complaint or other
appropriate pleading. (Underscoring supplied by Caroline.)16
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Specific provisions of law govern the case at bar, however. Thus Articles 49
and 50 of the Family Code provide:
Art. 49. During the pendency of the action [for annulment or declaration of
nullity of marriage] and in the absence of adequate provisions in a written
agreement between the spouses, the Court shall provide for the support of the
spouses and the custody and support of their common children. x x x It
shall also provide for appropriate visitation rights of the other
parent. (Emphasis and underscoring supplied)17
Art. 50. x x x x
The final judgment in such cases [for the annulment or declaration of nullity
of marriage] shall provide for the liquidation, partition and distribution of the
properties of the spouses, the custody and support of the common
children, and the delivery of their presumptive legitimes, unless such other
matters had been adjudicated in previous judicial proceedings."
(Emphasis and underscoring added)
By petitioners filing of the case for declaration of nullity of marriage before
the Pasig RTC he automatically submitted the issue of the custody of Bianca
as an incident thereof. After the appellate court subsequently dismissed the
habeas corpus case, there was no need for petitioner to replead his prayer for
custody for, as above-quoted provisions of the Family Code provide, the
custody issue in a declaration of nullity case is deemed pleaded. That that is
so gains light from Section 21 of the "Rule on Declaration Of Absolute
Nullity Of Void Marriages and Annulment of Voidable Marriages" 18 which
provides:
Sec. 21. Liquidation, partition and distribution, custody, support of common
children and delivery of their presumptive legitimes.Upon entry of the
judgment granting the petition, or, in case of appeal, upon receipt of the entry
of judgment of the appellate court granting the petition, the Family Court,
on motion of either party, shall proceed with the liquidation, partition
and distribution of the properties of the spouses, includingcustody,
support of common children and delivery of their presumptive legitimes
pursuant to Articles 50 and 51 of the Family Code unless such matters had
been adjudicated in previous judicial proceedings. (Emphasis and
underscoring supplied)
Since this immediately-quoted provision directs the court taking jurisdiction
over a petition for declaration of nullity of marriage to resolve the custody of
common children, by mere motion of either party, it could only mean that the
filing of a new action is not necessary for the court to consider the issue of
custody of a minor.19
The only explicit exception to the earlier-quoted second paragraph of Art. 50
of the Family Code is when "such matters had been adjudicated in previous
judicial proceedings," which is not the case here.
The elements of litis pendentia having been established, the more
appropriate action criterion guides this Court in deciding which of the two
pending actions to abate.20
The petition filed by petitioner for the declaration of nullity of marriage
before the Pasig RTC is the more appropriate action to determine the issue of
who between the parties should have custody over Bianca in view of the
express provision of the second paragraph of Article 50 of the Family Code.
This must be so in line with the policy of avoiding multiplicity of suits. 21
The appellate court thus erroneously applied the law of the case doctrine
when it ruled that in its July 5, 2002 Resolution that the pendency of the
habeas corpus petition in CA-G.R. SP No. 68460 prevented the Pasig RTC
from acquiring jurisdiction over the custody aspect of petitioners petition for
declaration of nullity. The factual circumstances of the case refelected above
do not justify the application of the law of the case doctrine which has been
defined as follows:
Law of the case has been defined as the opinion delivered on a former
appeal. It is a term applied to an established rule that when an appellate
court passes on a question and remands the case to the lower court for
further proceedings, the question there settled becomes the law of the
case upon subsequent appeal. It means that whatever is once irrevocably
established as the controlling legal rule or decision between the same
parties in the same case continues to be the law of the case, whether correct
on general principles or not, so long as the facts on which such decision was
predicated continue to be the facts of the case before the court." (Emphasis
and underscoring supplied, italics in the original)22
WHEREFORE, the petition is GRANTED. The August 10, 2004 decision
of the Court of Appeals is REVERSEDand SET ASIDE,and another is
entered DISMISSING Pasay City Regional Trial Court Sp. Proc. No. 03-
0048-CFM and ordering Branch 69 of Pasig City Regional Trial Court to
continue, with dispatch, the proceedings in JDRC No. 6190.
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Footnotes By its own action, Branch 62 had lost jurisdiction over the case. It
could not have reacquired jurisdiction over the said case on mere
3
"Rule on Custody of Minors and Writ of Habeas Corpus in Relation to motion of one of the parties. The Rules of Court is specific on how a
Minors," approved by the Supreme Court en banc on 22 April 2003, effective new case may be initiated and such is not done by mere motion in
15 May 2003. a particular branch of the RTC.

19
Vide Asset Privatization Trust v. Court of Appeals, G.R. No. 121171,
December 29, 1998, 300 SCRA 579, 599:

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