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THIRD DIVISION

[A.M. No. P-02-1535. March 28, 2003]

FERNANDO FAJARDO, complainant, vs. Sheriff RODOLFO V.


QUITALIG, Municipal Trial Court in Cities, San Carlos City,
Pangasinan, respondent.

DECISION
PANGANIBAN, J.:

As frontline officials of the justice system, sheriffs must always strive to maintain
public trust in the performance of their duties. Hence, they must see to it that the final
stage in the litigation process is completed without unnecessary delay.

The Case and the Facts

In a Sworn Complaint dated April 11, 2000, Sheriff Rodolfo V. Quitalig of the
[1]

Municipal Trial Court in Cities (MTCC) of San Carlos City was charged by Reverend
Fernando Fajardo with conduct prejudicial to the best interest of the service and/or
dereliction of duty.

The factual antecedents of the case are summarized by the Office of the Court
Administrator (OCA) as follows:

Complainant, who is one of the plaintiffs in [Civil Case No. MTCC-2266 entitled
Spouses Fernando Fajardo and Evangeline Perez vs. Maria Datuin], alleged that the
complaint for ejectment which they filed on July 17, 1997 was finally decided on July
29, 1999 against the defendant. The decision was appealed to the Regional Trial Court
but it was dismissed on November 29, 1999, and the decision became final and
executory. His lawyer filed a Motion for Execution, and on March 7, 2000, the Court
issued a Writ of Execution which was brought by the respondent Sheriff to the
defendant Maria Datuin on March 9, 2000.

Complainant claimed that after the Writ of Execution was served, defendant asked for
a period of two (2) weeks for her to remove her personal properties on the land. After
two (2) weeks he went to Sheriff Quitalig so that the Writ of Execution may be
implemented but he was told that a restraining order was issued, but when he asked
for it, the respondent told him that he left it in the office.
Complainant stated that on March 24, 2000, he and his lawyer went to the court to
verify whether a restraining order has really been issued but they found out that there
was none; so he told the respondent to implement the Writ of Execution. Respondent,
accompanied by a policeman and the barangay captain went to the place where the
Writ of Execution is to be implemented at 10:00 that morning but when they reached
the place, respondent did not do anything except to ask the defendant to bring out her
personal properties. His reason is that an employee of the Probation Office, Mr.
Leonardo Martinez, talked to him. At 5:30 p.m., the restraining order was brought to
the place, and the respondent told him that the writ of execution can no longer be
implemented.

Complainant asserted that respondent favored, or showed partiality in favor of the


defendant to his prejudice. [2]

In his Comment dated October 3, 2000, respondent denied the charge. He asked
[3]

for the dismissal of the case, because he had already implemented the Writ on August
24, 2000 as evidenced by his August 25, 2000 Report of Service. He also pointed out
[4]

that he had made an inventory of the personal properties recovered from the subject
premises. That he had done so was attested to by defendants mother, Rufina Datuin,
and witnessed by the barangay captain and two councilors.

The OCAs Finding and Recommendation

In its October 29, 2001 Report, the OCA found respondent to have been negligent
[5]

in the performance of his duty as a sheriff. It said thus:

Respondent was negligent in the performance of his duty as sheriff. The Writ of
Execution was issued on March 7, 2000, and was served on the judgment obligor on
March 9, 2000. Respondent admitted that the judgment obligor promised to vacate the
premises on March 29, 2000, but he was not able to implement the Writ of Execution
because on March 24, 2000, RTC, Branch 56, San Carlos, Pangasinan issued a
Temporary Restraining Order. The Temporary Restraining Order did not ripen into an
injunction so it lapsed after twenty (20) days from the date it was issued, but the Writ
of Execution was implemented only [on] August 24, 2000 which is more than four (4)
months from the date the restraining order lapsed. It is the duty of the sheriff to
enforce a writ of execution without delay once it is given to him unless restrained.

The Writ of Execution was finally and/or implemented only on August 24, 2000, as
shown in the Report submitted by the respondent in court. Complainant claimed that
the respondent was reluctant to implement the Writ of Execution because a certain
Leonardo Martinez intervened. This allegation of the complainant was not denied by
the respondent in his Comment. Respondent just stated in his Comment that he
implemented the Writ of Execution on August 24, 2000, and made inventory of the
personal properties pulled out from the building and signed by defendants mother and
Barangay Captain Nestor Poquiz. Respondents deliberate refusal to traverse or refute
the charges is an admission that the allegations are true and he cannot deny them.
(Citation omitted)
[6]

The OCA recommended that respondent be ordered to pay a fine of P5,000 and
warned that a repetition of the same or a similar offense would be dealt with more
severely. [7]

This Courts Ruling

We agree with the OCAs findings and recommendation.

Respondents Administrative Liability

As frontline officials of the justice system, sheriffs must always strive to maintain
public trust in the performance of their duties. Having the forsworn duty to uphold the
majesty of the law, they must see to it that the final stage in the litigation process is
carried out without unnecessary delay. [8]

A review of the records of this case reveals that respondent enforced the Writ of
Execution dated March 7, 2000 only on August 24, 2000, as shown by his August 25,
2000 Report of Service. Within 30 days from receipt thereof and every 30 days
thereafter until the judgment is fully satisfied, a sheriff is required by the Rules of Court
to render a report on the action taken on a writ of execution. Section 14 of Rule 39 of
the Rules provides the manner in which the execution is to be implemented, as follows:

SEC. 14. Return of Writ of Execution. The writ of execution shall be returnable to the
court issuing it immediately after the judgment has been satisfied in part or in full. If
the judgment cannot be satisfied in full within thirty days (30) days after his receipt of
the writ, the officer shall report to the court and state the reason therefore. Such writ
shall continue in effect during the period within which the judgment may be enforced
by motion. The officer shall make a report to the court every thirty (30) days on the
proceedings taken thereon until the judgment is satisfied in full, or its effectivity
expires. The returns or periodic reports shall set forth the whole of the proceedings
taken, and shall be filed with the court and copies thereof promptly furnished the
parties.

Evidently, respondent was not only remiss in his implementation of the Writ, but
likewise derelict in his submission of the returns thereof.
Respondent should have immediately implemented and made a return of the Writ
after duly serving it upon the defendant on March 9, 2000. Nonetheless, because of the
request of the defendant and her promise that she would vacate the premises on March
23, 2000, he allowed her to remain there. However, when he came back on March 24,
2000, he was unable to enforce the Writ because of a TRO issued by the RTC of San
Carlos, Pangasinan. He averred that he was finally able to execute the Writ on August
24, 2000 and to submit his Return thereof on the next day.

We find respondents explanation to be utterly wanting. He is guilty of dereliction of


his duty as a sheriff, because he failed to (1) execute the Writ within 30 days from his
receipt thereof, (2) submit his Report of Service within the same period, (3) make
periodic reports to the MTCC until the judgment was fully satisfied, and (4) furnish the
parties with copies of the Reports.

By his own words, respondent admitted his dereliction of duty. First, as we have
said earlier, he should have immediately executed the Writ when he served it upon the
defendant on March 9, 2000.

Second, he should have immediately reported to the MTCC that he was unable to
enforce the Writ because another court had issued a TRO enjoining him from doing
so. Third, he should have informed the parties, particularly the plaintiff or his counsel,
about his inability to enforce the Writ. Fourth, he should have immediately enforced it
twenty days after its issuance.

Fifth, he should have made periodic Reports to the MTCC until the judgment was
fully satisfied and the parties furnished a copy thereof. Sixth, within thirty days from his
receipt of the Writ, he should have promptly made his Return, a copy of which he should
have immediately furnished the parties.

Clearly, the actuations of respondent constitute disrespect, if not outright defiance,


of the MTCCs authority. In the absence of instructions to the contrary, a sheriff has the
duty to execute a Writ with reasonable celerity and promptness in accordance with its
mandate.

In several cases, the Court has said that the failure to make a return of a writ within
[9]

the required period is nonfeasance. In Bautista v. De Castro, the provincial sheriff of


[10]

Zambales and his deputy were suspended without pay for 30 and 15 days, respectively,
for dereliction of duty. In Barola v. Abogatal, a sheriff who had received a writ of
[11]

execution on January 15, 1978, but made a return thereof only on May 22, 1978, was
fined a months salary. In Lapea v. Pamarang, a sheriff whose Return was four days
[12]

late was fined P2,000.

Casal v. Concepcion Jr. ordered the dismissal of respondent sheriff from the
[13]

service and the forfeiture of all his benefits, with prejudice to his reemployment in any
branch or service of the government including government-owned and controlled
corporations. After the lapse of two years from the issuance of the original Writ in a
simple ejectment case, he not only failed to exert reasonable efforts to fully implement
its subsequent issuances, but likewise failed to account for the amounts he got from
complainant. Furthermore, he abandoned his work during the time that the charges
against him were being investigated.

In Concerned Citizen v. Torio, the respondent therein was suspended for a year
[14]

without pay when he failed to act promptly on the Writs of Execution issued from 1998-
2001. And in Lumbre v. Dela Cruz, respondent, after being found guilty of an
[15]

inexcusable seven-month delay in carrying out a lawful Writ of Execution was


fined P5,000. Justifying the penalty, the Court said:

When a writ of execution is placed in the hands of a sheriff, it is his duty, in the
absence of contrary instructions, to have it implemented forthwith. The sheriff is
primarily responsible for the speedy and efficient service of all court processes and
writs originating from the court and its branches, including such as may be properly
delegated to him by other courts. The delay of more than seven months, from the time
the writ of execution was issued by the court on 07 August 1998 to the time when
respondent sheriff posted the notice of sale or levy on 23 March 1999, is an
inordinately long period for respondent to act thereon. The importance of the role
played by all court personnel in the administration of justice is never to be taken
lightly. It is the sheriffs particularly who are depended on, and who must properly
attend to, the proper implementation of court decrees and orders, and they are
expected to do so with utmost diligence and dispatch. [16]

WHEREFORE, Sheriff Rodolfo V. Quitalig is found guilty of dereliction of duty and


is ORDERED to pay a FINE of five thousand pesos (P5,000). Considering that he has
already retired from the service, this amount is hereby ordered deducted from his
retirement benefits.

SO ORDERED.

Puno, (Chairman), Sandoval-Gutierrez, Corona, and Carpio-Morales, JJ., concur.


EN BANC

[G.R. No. 155618. March 26, 2003]

EDGAR Y. SANTOS, petitioner, vs. COMMISSION ON ELECTIONS


(FIRST DIVISION) and PEDRO Q. PANULAYA, respondents.

DECISION
YNARES-SANTIAGO, J.:

Petitioner Edgar Y. Santos and respondent Pedro Q. Panulaya were both


candidates for Mayor of the Municipality of Balingoan, Misamis Oriental in the
May 14, 2001 elections. On May 16, 2001, after the votes were counted and
canvassed, the Municipal Board of Canvassers proclaimed respondent
Panulaya as the duly elected Mayor.

Petitioner filed an election protest before the Regional Trial Court of


Misamis Oriental, Branch 26, which was docketed as SPL Election Protest No.
1-M(2001). After trial and revision of the ballots, the trial court found that
petitioner garnered 2,181 votes while respondent received only 2,105. Hence,
on April 2, 2002, it rendered judgment as follows:

WHEREFORE, judgment is hereby rendered declaring and proclaiming


protestant/petitioner Edgar Y. Santos as the duly elected Municipal Mayor of
Balingoan, Misamis Oriental, in the mayoralty elections held on May 14, 2001 with
the plurality of Seventy Six (76) votes over and above his protagonist-protestee Pedro
Q. Panulaya setting aside as null and void the proclamation of protestee made by the
Municipal Board of Canvassers on May 16, 2001, ordering to pay protestant/petitioner
the costs and expenses that the latter incurred in this protest in accordance with
Section 259 of the Omnibus Election Code of the Philippines (B.P. 881) and Section 7
of the COMELEC Resolution 1566, to wit:
xxx xxx xxx.

The Clerk of Court of this Court is hereby directed to furnish copy of the DECISION
to the following: Office of the Commission on Elections (COMELEC); Office of the
Commission on Audit; Office of the Department of Interior and Local Government;
Office of the Sangguniang Panlalawigan of Misamis Oriental, in accordance with
Section 15 of the COMELEC Resolution 1566.

SO ORDERED. [1]

Petitioner thereafter filed a motion for execution pending


appeal. Meanwhile, before the trial court could act on petitioners motion,
respondent filed on April 22, 2002 with the Commission on Elections
(COMELEC) a petition for certiorari, docketed as SPR No. 20-2002, assailing
the decision of the trial court. Likewise on April 22, 2002, respondent
[2]

appealed the trial courts decision to the COMELEC, where it was docketed as
EAC No. A-12-2002.

The COMELEC, in SPR No. 20-2002, issued a Writ of Preliminary


Injunction, which effectively enjoined the trial court from acting on petitioners
motion for execution pending appeal.Subsequently, on August 19, 2002, the
COMELEC dismissed SPR No. 20-2002 after finding that the trial court did not
commit grave abuse of discretion in rendering the assailed
judgment.Moreover, the COMELEC held that the remedy from the decision of
the court a quo was to file a notice of appeal, which respondent precisely did
in EAC No. A-12-2002. Hence, it directed the trial court to dispose of all
pending incidents in SPL Election Protest No. 1-M(2001) with dispatch, to wit:

WHEREFORE, premises considered, the Commission (First Division) RESOLVED


as it hereby RESOLVES to DISMISS the instant petition for lack of merit.

ACCORDINGLY, the Writ of Preliminary Injunction issued on 16 May 2002, as well


as the Order issued on 27 April 2002 by the Commission (First Division), are hereby
set aside and lifted, respectively.The Court a quo is hereby directed to dispose with
immediate dispatch all pending incidents in SPL Election Case No. 1-M
(2001) entitled Edgar Y. Santos, Petitioner/Protestant versus Pedro Q. Panulaya,
Respondent/Protestee.

No pronouncement as to cost.
SO ORDERED. (underscoring ours) [3]

Thus, on August 20, 2002, the trial court issued an Order as follows:

WHEREFORE, premises considered, this Court hereby upholds and approves the
Motion for Execution Pending Appeal. Further, finding good reasons therefor, the
Court hereby directs and orders the immediate execution of the Decision promulgated
on April 18, 2002, and as prayed for install protestant/petitioner EDGAR Y. SANTOS
as the duly elected Mayor of Balingoan, Misamis Oriental, to take his oath of office
and assume the functions and duties of Mayor after he shall have filed a bond of One
Hundred Thousand Pesos (P100,000.00).

SO ORDERED. [4]

After petitioner posted the required bond, the trial court issued the Writ of
Execution, thereby installing petitioner as Municipal Mayor of Balingoan,
[5]

Misamis Oriental. Accordingly, petitioner took his oath of office and thereafter
assumed the duties and functions of his office.

On August 21, 2002, respondent filed with the COMELEC a motion for
reconsideration of the dismissal of his petition in SPR No. 20-2002. After five[6]

days, or on August 26, 2002, he filed a supplemental petition in SPR No. 20-
2002, wherein he prayed:
[7]

WHEREFORE, foregoing premises considered, petitioner [herein respondent]


respectfully prays unto this Honorable Commission that the following Orders of the
public respondent:

1. Resolution dated 20 August 2002;

2. Order dated 20 August 2002;

3. Writ of execution dated 21 August 2002;

Be nullified and set aside.

It is further prayed that in the event that the public respondent has carried out its Order
of ousting petitioner [herein respondent] from his position as Mayor of Balingoan,
Misamis Oriental, that the same be nullified and considered of no legal effect. It is
likewise prayed that a STATUS QUO ANTE ORDER be issued by the Honorable
Commission in order to reinstate the petitioner to his rightful position as Mayor of
Balingoan, Misamis Oriental.

Other reliefs, just and equitable are likewise prayed for. [8]

Barely two days later, on August 28, 2002, and while his motion for
reconsideration and supplemental petition in SPR No. 20-2002 were pending,
respondent filed another petition with the COMELEC, docketed as SPR No.
37-2002. The petition contained the same prayer as that in the supplemental
[9]

petition filed in SPR 20-2002, viz:

WHEREFORE, foregoing premises considered, petitioner [herein respondent]


respectfully prays unto this Honorable Commission that immediately upon the
filing of the herein petition, the following Orders of the public respondent:

1. Resolution dated 20 August 2002;

2. Order dated 20 August 2002;

3. Writ of execution dated 21 August 2002;

Be nullified and set aside.

Pending trial and final judgment, and soon after the issuance, but during the effectivity
of the Temporary Restraining Order, a Writ of Preliminary Injunction be issued
prohibiting, restraining and/or enjoining the public respondent from further
implementing the highly unjust, irregular and oppressive Orders above-quoted;

It is further prayed that in the event that the public respondent has carried out
its Order of ousting petitioner [herein respondent] from his position as Mayor of
Balingoan, Misamis Oriental, that the same be nullified and considered of no
legal effect. It is likewise prayed that a STATUS QUO ANTE ORDER be issued by
the Honorable Commission in order to reinstate the petitioner to his rightful
position as Mayor of Balingoan, Misamis Oriental.

Upon due notice and hearing, judgment be rendered in favor of the petitioner [herein
respondent] and against the respondent [herein petitioner] as follows:

1. Making the Writ of Preliminary Prohibitory Injunction permanent;

2. Declaring Resolution dated 20 August 2002, Order dated 20 August 2002, and Writ
of Execution dated 21 August 2002; as null and void for being highly unjust, irregular
and oppressively prepared in utter violation of the Constitutional provisions on equal
protection of the laws and due process, and for having been rendered with grave
abuse of discretion amounting to lack or excess of jurisdiction.

3. A writ of Prohibition be issued specifically commanding public respondent to cease


and desist from further implementing the highly unjust, irregular and oppressive
Orders above-mentioned are concerned (sic); and

4. Ordering the respondents to pay the costs of suit.

Such other reliefs and remedies, as are just and equitable in the premises, are likewise
prayed for.[10]

On September 3, 2002, the COMELEC issued the assailed Order directing


the parties to maintain the status quo ante and enjoining petitioner from
assuming the functions of Mayor.Pertinent portion of the Order reads:

In the interest of justice and so as not to render moot and academic the issues raised in
the petition, the Commission (First Division) hereby directs the parties to maintain
the status quo ante, which is the condition prevailing before the issuance and
implementation of the questioned Order of the court a quo dated August 20, 2002 and
the Writ of Execution issued pursuant thereto dated August 21, 2002, in SPL.
ELECTION CASE NO. 1-M (2001) entitled EDGAR Y. SANTOS versus PEDRO Q.
PANULAYA. Accordingly, effective immediately, private respondent EDGAR Y.
SANTOS is hereby ordered to cease and desist from assuming the duties and
functions of the office of Mayor of Balingoan, Misamis Oriental until further orders
from this Commission. [11]

Petitioner filed a motion for reconsideration of the above Order. However,


the COMELEC First Division did not refer the said motion to the COMELEC
En Banc. Hence, petitioner, citing our ruling in Kho v. COMELEC, brought [12]

the instant special civil action for certiorari with this Court.

Meanwhile, on September 9, 2002, petitioner filed an Omnibus Motion (1)


To Dissolve The Status Quo Order As It Was Based On An Unverified And
Dismissed Petition With Pending Motion For Reconsideration; And (2) To
Refer This Motion To The Commission En Banc Under Section 2, Rule 3 of
the COMELEC Rules of Procedure. On October 14, 2002, the COMELEC
[13]

issued a Resolution in SPR No. 37-2002, the dispositive portion of which


states:
WHEREFORE, premises considered, the Petition is
hereby GRANTED. Accordingly, the August 20, 2002 Resolution of the respondent
judge granting the Motion for Execution Pending Appeal as well as his Order also
dated August 20, 2002 directing the issuance of the Writ of Execution and his Writ of
Execution dated August 21, 2002 are hereby set aside. Private Respondent Edgar Y.
Santos is enjoined from assuming the function of mayor of Balingoan, Misamis
Oriental until the final determination of the election appeal case.

This resolution shall be immediately executory.

The Department of Interior and Local Government (DILG) is hereby requested to


assist in the peaceful and orderly implementation of this Resolution.

SO ORDERED. [14]

The petition is impressed with merit.

It is at once apparent from the records, as shown above, that respondent


was guilty of forum-shopping when he instituted SPR No. 37-2002 with the
COMELEC. Forum-shopping is an act of a party against whom an adverse
judgment or order has been rendered in one forum of seeking and possibly
getting a favorable opinion in another forum, other than by appeal or special
civil action for certiorari. It may also be 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. For it to exist, there should be
(a) identity of parties, or at least such parties as would represent the same
interest in both actions; (b) identity of rights asserted and relief prayed for, the
relief being founded on the same facts; and (c) identity of the two preceding
particulars such that any judgment rendered in the other action will, regardless
of which party is successful, amount to res judicata in the action under
consideration. [15]

In the case at bar, respondent obtained an adverse decision when his


petition in SPR No. 20-2002 was dismissed by the COMELEC. He thereafter
filed a motion for reconsideration and a supplemental petition, praying for the
nullification of the trial courts order for the execution of its decision pending
appeal. Two days after filing the supplemental petition, and while the same
was very much pending before the COMELEC, he filed a wholly separate
petition for certiorari, docketed as SPR No. 37-2002, wherein he pleaded the
same reliefs prayed for in the supplemental petition. This is plainly evident
from the respective prayers in the supplemental petition and the petition for
certiorari as reproduced hereinabove. In doing so, respondent, before allowing
the COMELEC to fully resolve the incidents in SPR No. 20-2002, both of
which were at his own instance, sought to increase his chances of securing a
favorable decision in another petition. He filed the second petition on the
supposition that the COMELEC might look with favor upon his reliefs.

Forum-shopping is 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. The most important factor in determining the
[16]

existence of forum shopping is the vexation caused the courts and parties-
litigants by a party who asks different courts to rule on the same or related
causes or grant the same or substantially the same reliefs. [17]

Considering that respondent was indubitably guilty of forum-shopping


when he filed SPR No. 37-2002, his petition should have been dismissed
outright by the COMELEC. Willful and deliberate forum-shopping is a ground
[18]

for summary dismissal of the case, and constitutes direct contempt of court. [19]

The petition for certiorari in SPR No. 37-2002 assailed the trial courts
orders for the execution of its decision pending appeal. The grant of execution
pending appeal was well within the discretionary powers of the trial court. In
order to obtain the annulment of said orders in a petition for certiorari, it must
first be proved that the trial court gravely abused its discretion. He should
show not merely a reversible error committed by the trial court, but a grave
abuse of discretion amounting to lack or excess of jurisdiction. Grave abuse of
discretion implies such capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction, or where the power is exercised in an
arbitrary or despotic manner by reason of passion or personal hostility which
must be so patent and gross as to amount to an invasion of positive duty or to
a virtual refusal to perform the duty enjoined or to act at all in contemplation of
law. Mere abuse of discretion is not enough. [20]

We find that no grave abuse of discretion was committed by the trial


court. In its order granting execution pending appeal, it held:

It is of judicial notice that for the public official elected last May 14, 2001 elections
only a short period is left. Relative to this Courts jurisdiction over the instant case, the
settled rule that the mere filing of the notice of appeal does not divest the trial court of
its jurisdiction over the case and to resolve pending incidents, i.e., motion for
execution pending appeal (Asmala vs. COMELEC, 289 SCRA 745) need not be
overemphasized. [21]

However, the COMELEC set aside the aforesaid order, saying that
shortness of term alone is not a good reason for execution of a judgment
pending appeal. We disagree.

While it was indeed held that shortness of the remaining term of office and
posting a bond are not good reasons, we clearly stated in Fermo v.
COMELEC that:[22]

A valid exercise of the discretion to allow execution pending appeal requires that it
should be based upon good reasons to be stated in a special order. The following
constitute good reasons and a combination of two or more of them will suffice to grant
execution pending appeal: (1.) public interest involved or will of the electorate; (2.)
the shortness of the remaining portion of the term of the contested office; and (3.) the
length of time that the election contest has been pending (italics supplied). [23]

The decision of the trial court in Election Protest No. 1-M(2001) was
rendered on April 2, 2002, or after almost one year of trial and revision of the
questioned ballots. It found petitioner as the candidate with the plurality of
votes. Respondent appealed the said decision to the COMELEC. In the
meantime, the three-year term of the Office of the Mayor continued to run. The
will of the electorate, as determined by the trial court in the election protest,
had to be respected and given meaning. The Municipality of Balingoan,
Misamis Oriental, needed the services of a mayor even while the election
protest was pending, and it had to be the candidate judicially determined to
have been chosen by the people.

Between the determination by the trial court of who of the candidates won
the elections and the finding of the Board of Canvassers as to whom to
proclaim, it is the courts decision that should prevail. This was sufficiently
explained in the case of Ramas v. COMELEC in this wise:
[24]

All that was required for a valid exercise of the discretion to allow execution pending
appeal was that the immediate execution should be based upon good reasons to be
stated in a special order. The rationale why such execution is allowed in election cases
is, as stated in Gahol v. Riodique, to give as much recognition to the worth of a trial
[25]
judges decision as that which is initially ascribed by the law to the proclamation by
the board of canvassers. Thus:

Why should the proclamation by the board of canvassers suffice as basis of the right
to assume office, subject to future contingencies attendant to a protest, and not the
decision of a court of justice? Indeed, when it is considered that the board of
canvassers is composed of persons who are less technically prepared to make an
accurate appreciation of the ballots, apart from their being more apt to yield to
extraneous considerations, and that the board must act summarily, practically racing
against time, while, on the other hand, the judge has benefit of all the evidence the
parties can offer and of admittedly better technical preparation and background, apart
from his being allowed ample time for conscientious study and mature deliberation
before rendering judgment, one cannot but perceive the wisdom of allowing the
immediate execution of decisions in election cases adverse to the protestees,
notwithstanding the perfection and pendency of appeals therefrom, as long as there
are, in the sound discretion of the court, good reasons therefor.

To deprive trial courts of their discretion to grant execution pending appeal would, in
the words of Tobon Uy v. COMELEC, [26]

bring back the ghost of the grab-the-proclamation-prolong the protest techniques so


often resorted to by devious politicians in the past in their efforts to perpetuate their
hold to an elective office. This would, as a consequence, lay to waste the will of the
electorate.
[27]

Thus, the COMELEC committed grave abuse of discretion in giving due


course, instead of dismissing outright, the petition in SPR No. 37-2002 despite
the clear showing that respondent was guilty of forum-shopping; and in setting
aside the trial courts order granting execution pending appeal.

WHEREFORE, in view of the foregoing, the instant petition is


GRANTED. The Order dated September 3, 2002 and the Resolution dated
October 14, 2002 of the Commission on Elections in SPR No. 37-2002 are
ANNULLED and SET ASIDE and the said case is ordered DISMISSED on the
ground of forum-shopping. The Order dated August 20, 2002 of the Regional
Trial Court of Misamis Oriental, Branch 26, granting the execution pending
appeal of its decision in Election Protest No. 1-M(2001), and the Writ of
Execution dated August 21, 2002, are REINSTATED. The full enforcement of
the said Writ must forthwith be made. The court of origin shall transmit
immediately to the Commission on Elections the records of SPL Election Case
No. 1-M(2001), and the Commission on Elections shall dispose of the appeal
in EAC No. A-12-2002 with deliberate dispatch.

This Decision shall be immediately executory.

Costs against private respondent.

SO ORDERED.

SECOND DIVISION

[G.R. No. 152878. May 5, 2003]

RIZAL COMMERCIAL BANKING CORPORATION, petitioner, vs.


MAGWIN MARKETING CORPORATION, NELSON TIU, BENITO SY
and ANDERSON UY, respondents.

DECISION
BELLOSILLO, J.:

WE ARE PERTURBED that this case should drag this Court in the banal
attempts to decipher the hazy and confused intent of the trial court in
proceeding with what would have been a simple, straightforward and hardly
arguable collection case. Whether the dismissal without prejudice for failure to
prosecute was unconditionally reconsidered, reversed and set aside to
reinstate the civil case and have it ready for pre-trial are matters which should
have been clarified and resolved in the first instance by the court a
quo. Unfortunately, this feckless imprecision of the trial court became the soup
stock of the parties and their lawyers to further delay the case below when
they could have otherwise put things in proper order efficiently and effectively.

On 4 March 1999 petitioner Rizal Commercial Banking Corporation


(RCBC) filed a complaint for recovery of a sum of money with prayer for a writ
of preliminary attachment against respondents Magwin Marketing
Corporation, Nelson Tiu, Benito Sy and Anderson Uy. On 26 April 1999, the
[1]

trial court issued a writ of attachment. On 4 June 1999 the writ was returned
[2]

partially satisfied since only a parcel of land purportedly owned by defendant


Benito Sy was attached. In the meantime, summons was served on each of
[3]

the defendants, respondents herein, who filed their respective answers,


except for defendant Gabriel Cheng who was dropped without prejudice as
party-defendant as his whereabouts could not be located. On 21 September
[4]

1999 petitioner moved for an alias writ of attachment which on 18 January


2000 the court a quo denied. [5]

Petitioner did not cause the case to be set for pre-trial. For about six (6)
[6]

months thereafter, discussions between petitioner and respondents Magwin


Marketing Corporation, Nelson Tiu, Benito Sy and Anderson Uy, as parties in
Civil Case No. 99-518, were undertaken to restructure the indebtedness of
respondent Magwin Marketing Corporation. On 9 May 2000 petitioner
[7]

approved a debt payment scheme for the corporation which on 15 May 2000
was communicated to the latter by means of a letter dated 10 May 2000 for
the conformity of its officers, i.e., respondent Nelson Tiu as President/General
Manager of Magwin Marketing Corporation and respondent Benito Sy as
Director thereof. Only respondent Nelson Tiu affixed his signature on the
[8]

letter to signify his agreement to the terms and conditions of the restructuring. [9]

On 20 July 2000 the RTC of Makati City, on its own initiative, issued
an Order dismissing without prejudice Civil Case No. 99-518 for failure of
petitioner as plaintiff therein to prosecute its action for an unreasonable length
of time x x x. On 31 July 2000 petitioner moved for reconsideration of
[10]

the Order by informing the trial court of respondents unremitting desire to


settle the case amicably through a loan restructuring program. On 22 August [11]

2000 petitioner notified the trial court of the acquiescence thereto of


respondent Nelson Tiu as an officer of Magwin Marketing Corporation and
defendant in the civil case. [12]
On 8 September 2000 the court a quo issued an Order reconsidering the
dismissal without prejudice of Civil Case No. 99-518

Acting on plaintiffs Motion for Reconsideration of the Order dated 20 July 2000
dismissing this case for failure to prosecute, it appearing that there was already
conformity to the restructuring of defendants indebtedness with plaintiff by defendant
Nelson Tiu, President of defendant corporation per Manifestation and Motion filed by
plaintiff on 22 August 2000, there being probability of settlement among the parties,
as prayed for, the Order dated 20 July 2000 is hereby set aside.

Plaintiff is directed to submit the compromise agreement within 15 days from receipt
hereof. Failure on the part of plaintiff to submit the said agreement shall cause the
imposition of payment of the required docket fees for re-filing of this case.
[13]

On 27 July 2000 petitioner filed in Civil Case No. 99-518 a Manifestation


and Motion to Set Case for Pre-Trial Conference alleging that [t]o date, only
defendant Nelson Tiu had affixed his signature on the May 10, 2000 letter
which informed the defendants that plaintiff [herein petitioner] already
approved defendant Magwin Marketing Corporations request for restructuring
of its loan obligations to plaintiff but subject to the terms and conditions
specified in said letter. This motion was followed on 5 October 2000 by
[14]

petitioners Supplemental Motion to Plaintiffs Manifestation and Motion to Set


Case for Pre-Trial Conference affirming that petitioner could not submit a
compromise agreement because only defendant Nelson Tiu had affixed his
signature on the May 10, 2000 letter x x x. Respondent Anderson Uy
[15]

opposed the foregoing submissions of petitioner while respondents Magwin


Marketing Corporation, Nelson Tiu and Benito Sy neither contested nor
supported them. [16]

The trial court, in an undated Order (although a date was later inserted in
the Order), denied petitioners motion to calendar Civil Case No. 99-518 for
pre-trial stating that -

Acting on plaintiffs [herein petitioner] Manifestation and Motion to Set Case for Pre-
Trial Conference, the Opposition filed by defendant Uy and the subsequent
Supplemental Motion filed by plaintiff; defendant Uys Opposition, and plaintiffs
Reply; for failure of the plaintiff to submit a compromise agreement pursuant to the
Order dated 8 September 2000 plaintiffs motion to set case for pre-trial conference is
hereby denied.[17]
On 15 November 2000 petitioner filed its Notice of Appeal from the 8
September 2000 Order of the trial court as well as its undated Order in Civil
Case No. 99-518. On 16 November 2000 the trial court issued two (2) Orders,
one of which inserted the date 6 November 2000 in the
undated Order rejecting petitioners motion for pre-trial in the civil case, and
the other denying due course to the Notice of Appeal on the ground that the
Orders dated 8 September 2000 and 6 November 2000 are interlocutory
orders and therefore, no appeal may be taken x x x. [18]

On 7 December 2000 petitioner elevated the Orders dated 8 September


2000, 6 November 2000 and 16 November 2000 of the trial court to the Court
of Appeals in a petition for certiorari under Rule 65 of the Rules of Civil
Procedure. In the main, petitioner argued that the court a quo had no
[19]

authority to compel the parties in Civil Case No. 99-518 to enter into an
amicable settlement nor to deny the holding of a pre-trial conference on the
ground that no compromise agreement was turned over to the court a quo. [20]

On 28 September 2001 the appellate court promulgated


its Decision dismissing the petition for lack of merit and affirming the
assailed Orders of the trial court holding that -
[21]

x x x although the language of the September 8, 2000 Order may not be clear, yet, a
careful reading of the same would clearly show that the setting aside of the Order
dated July 20, 2000 which dismissed petitioners complaint x x x for failure to
prosecute its action for an unreasonable length of time is dependent on the following
conditions, to wit: a) The submission of the compromise agreement by petitioner
within fifteen (15) days from notice; and b) Failure of petitioner to submit the said
compromise agreement shall cause the imposition of the payment of the required
docket fees for the re-filing of the case; so much so that the non-compliance by
petitioner of condition no. 1 would make condition no. 2 effective, especially that
petitioners manifestation and motion to set case for pre-trial conference and
supplemental motion x x x [were] denied by the respondent judge in his Order dated
November 6, 2000, which in effect means that the Order dated July 20, 2000 was
ultimately not set aside considering that a party need not pay docket fees for the re-
filing of a case if the original case has been revived and reinstated.
[22]

On 2 April 2002 reconsideration of the Decision was denied; hence, this


petition.
In the instant case, petitioner maintains that the trial court cannot coerce
the parties in Civil Case No. 99-518 to execute a compromise agreement and
penalize their failure to do so by refusing to go forward with the pre-trial
conference. To hold otherwise, so petitioner avers, would violate Art. 2029 of
the Civil Code which provides that [t]he court shall endeavor to persuade the
litigants in a civil case to agree upon some fair compromise, and this Courts
ruling in Goldloop Properties, Inc. v. Court of Appeals where it was held that
[23]

the trial court cannot dismiss a complaint for failure of the parties to submit a
compromise agreement.

On the other hand, respondent Anderson Uy filed his comment after


several extensions asserting that there are no special and important reasons
for undertaking this review. He also alleges that petitioners attack is limited to
the Order dated 8 September 2000 as to whether it is conditional as the Court
of Appeals so found and the applicability to this case of the ruling in Goldloop
Properties, Inc. v. Court of Appeals. Respondent Uy claims that
the Order reconsidering the dismissal of Civil Case No. 99-518 without
prejudice is on its face contingent upon the submission of the compromise
agreement which in the first place was the principal reason of petitioner to
justify the withdrawal of the Order declaring his failure to prosecute the civil
case.He further contends that the trial court did not force the parties in the civil
case to execute a compromise agreement, the truth being that it dismissed
the complaint therein for petitioners dereliction.

Finally, respondent Uy contests the relevance of Goldloop Properties, Inc.


v. Court of Appeals, and refers to its incongruence with the instant case, i.e.,
that the complaint of petitioner was dismissed for failure to prosecute and not
for its reckless disregard to present an amicable settlement as was the
situation in Goldloop Properties, Inc., and that the dismissal was without
prejudice, in contrast with the dismissal with prejudice ordered in the cited
case. For their part, respondents Magwin Marketing Corporation, Nelson Tiu
and Benito Sy waived their right to file a comment on the instant petition and
submitted the same for resolution of this Court. [24]

The petition of Rizal Commercial Banking Corporation is meritorious. It


directs our attention to questions of substance decided by the courts a
quo plainly in a way not in accord with applicable precedents as well as the
accepted and usual course of judicial proceedings; it offers special and
important reasons that demand the exercise of our power of supervision and
review. Furthermore, petitioners objections to the proceedings below
encompass not only the Order of 8 September 2000 but include the
cognate Orders of the trial court of 6 and 16 November 2000. This is evident
from the prayer of the instant petition which seeks to reverse and set aside
the Decision of the appellate court and to direct the trial court to proceed with
the pre-trial conference in Civil Case No. 99-518. Evidently, the substantive
issue involved herein is whether the proceedings in the civil case should
progress, a question which at bottom embroils all the Orders affirmed by the
Court of Appeals.

On the task at hand, we see no reason why RTC-Br. 135 of Makati City
should stop short of hearing the civil case on the merits. There is no
substantial policy worth pursuing by requiring petitioner to pay again the
docket fees when it has already discharged this obligation simultaneously with
the filing of the complaint for collection of a sum of money. The procedure for
dismissed cases when re-filed is the same as though it was initially lodged,
i.e., the filing of answer, reply, answer to counter-claim, including other foot-
dragging maneuvers, except for the rigmarole of raffling cases which is
dispensed with since the re-filed complaint is automatically assigned to the
branch to which the original case pertained. A complaint that is re-filed leads
[25]

to the re-enactment of past proceedings with the concomitant full attention of


the same trial court exercising an immaculate slew of jurisdiction and control
over the case that was previously dismissed, which in the context of the
[26]

instant case is a waste of judicial time, capital and energy.

What judicial benefit do we derive from starting the civil case all over
again, especially where three (3) of the four (4) defendants, i.e., Magwin
Marketing Corporation, Nelson Tiu and Benito Sy, have not contested
petitioners plea before this Court and the courts a quo to advance to pre-trial
conference? Indeed, to continue hereafter with the resolution of petitioners
complaint without the usual procedure for the re-filing thereof, we will save the
court a quo invaluable time and other resources far outweighing the docket
fees that petitioner would be forfeiting should we rule otherwise.

Going over the specifics of this petition and the arguments of respondent
Anderson Uy, we rule that the Order of 8 September 2000 did not reserve
conditions on the reconsideration and reversal of the Order dismissing without
prejudice Civil Case No. 99-518. This is quite evident from its text which does
not use words to signal an intent to impose riders on the dispositive portion -
Acting on plaintiffs Motion for Reconsideration of the Order dated 20 July 2000
dismissing this case for failure to prosecute, it appearing that there was already
conformity to the restructuring of defendants indebtedness with plaintiff by defendant
Nelson Tiu, President of defendant corporation per Manifestation and Motion filed by
plaintiff on 22 August 2000, there being probability of settlement among the parties,
as prayed for, the Order dated 20 July 2000 is hereby set aside.

Plaintiff is directed to submit the compromise agreement within 15 days from receipt
hereof. Failure on the part of plaintiff to submit the said agreement shall cause the
imposition of payment of the required docket fees for re-filing of this case.
[27]

Contrary to respondent Uys asseverations, the impact of the second


paragraph upon the first is simply to illustrate what the trial court would do
after setting aside the dismissal without prejudice: submission of the
compromise agreement for the consideration of the trial court. Nothing in the
second paragraph do we read that the reconsideration is subject to two (2)
qualifications. Certainly far from it, for in Goldloop Properties, Inc. v. Court of
Appeals a similar directive, i.e., [t]he parties are given a period of fifteen (15)
[28]

days from today within which to submit a Compromise Agreement, was held to
mean that should the parties fail in their negotiations the proceedings would
continue from where they left off. Goldloop Properties, Inc.further said that its
order, or a specie of it, did not constitute an agreement or even an expectation
of the parties that should they fail to settle their differences within the
stipulated number of days their case would be dismissed.

The addition of the second sentence in the second paragraph does not
change the absolute nullification of the dismissal without prejudice decreed in
the first paragraph. The sentence [f]ailure on the part of plaintiff to submit the
said agreement shall cause the imposition of payment of the required docket
fees for re-filing of this case is not a directive to pay docket fees but only a
statement of the event that may result in its imposition. The reason for this is
that the trial court could not have possibly made such payment obligatory in
the same civil case, i.e., Civil Case No. 99-518, since docket fees are
defrayed only after the dismissal becomes final and executory and when the
civil case is re-filed.

It must be emphasized however that once the dismissal attains the


attribute of finality, the trial court cannot impose legal fees anew because a
final and executory dismissal although without prejudice divests the trial court
of jurisdiction over the civil case as well as any residual power to order
anything relative to the dismissed case; it would have to wait until the
complaint is docketed once again. On the other hand, if we are to concede
[29]

that the trial court retains jurisdiction over Civil Case No. 99-518 for it to issue
the assailed Orders, a continuation of the hearing thereon would not trigger a
disbursement for docket fees on the part of petitioner as this would obviously
imply the setting aside of the order of dismissal and the reinstatement of the
complaint.

Indubitably, it is speculative to reckon the effectivity of the Order of


dismissal without prejudice to the presentation of the compromise
agreement. If we are to admit that the efficacy of the invalidation of
the Order of dismissal is dependent upon this condition, then we must inquire:
from what date do we count the fifteen (15)-day reglementary period within
which the alleged revival of the order of dismissal began to run? Did it
commence from the lapse of the fifteen (15) days provided for in the Order of
8 September 2000? Or do we count it from the 6 November 2000 Order when
the trial court denied the holding of a pre-trial conference? Or must it be upon
petitioners receipt of the 16 November 2000 Order denying due course to
its Notice of Appeal? The court a quo could not have instituted an Order that
marked the proceedings before it with a shadow of instability and chaos rather
than a semblance of constancy and firmness.

The subsequent actions of the trial court also belie an intention to revive
the Order of dismissal without prejudice in the event that petitioner fails to
submit a compromise agreement.The Orders of 6 and 16 November 2000
plainly manifest that it was retaining jurisdiction over the civil case, a fact
which would not have been possible had the dismissal without prejudice been
resuscitated. Surely, the court a quo could not have denied on 6 November
2000 petitioners motion to calendar Civil Case No. 99-518 for pre-trial if the
dismissal had been restored to life in the meantime. By then the dismissal
without prejudice would have already become final and executory so as to
effectively remove the civil case from the docket of the trial court.

The same is true with the Order of 16 November 2000 denying due course
to petitioners Notice of Appeal. There would have been no basis for such
exercise of discretion because the jurisdiction of the court a quo over the civil
case would have been discharged and terminated by the presumed dismissal
thereof. Moreover, we note the ground for denying due course to the
appeal: the Orders dated 8 September 2000 and 6 November 2000 are
interlocutory orders and therefore, no appeal may be taken from x x x. This [30]

declaration strongly suggests that something more was to be accomplished in


the civil case, thus negating the claim that the Order of dismissal without
prejudice was resurrected upon the parties failure to yield a compromise
agreement. A final order issued by a court has been defined as one which
disposes of the subject matter in its entirety or terminates a particular
proceeding or action, leaving nothing else to be done but to enforce by
execution what has been determined by the court, while an interlocutory order
is one which does not dispose of a case completely but leaves something
more to be decided upon. [31]

Besides the semantic and consequential improbabilities of respondent Uys


argument, our ruling in Goldloop Properties, Inc., is decisive of the instant
case. In Goldloop Properties, Inc., we reversed the action of the trial court in
dismissing the complaint for failure of the plaintiff to prosecute its case, which
was in turn based on its inability to forge a compromise with the other parties
within fifteen (15) days from notice of the order to do so and held -

Since there is nothing in the Rules that imposes the sanction of dismissal for failing to
submit a compromise agreement, then it is obvious that the dismissal of the complaint
on the basis thereof amounts no less to a gross procedural infirmity assailable by
certiorari. For such submission could at most be directory and could not result in
throwing out the case for failure to effect a compromise. While a compromise is
encouraged, very strongly in fact, failure to consummate one does not warrant any
procedural sanction, much less an authority to jettison a civil complaint
worth P4,000,000.00 x x x Plainly, submission of a compromise agreement is never
mandatory, nor is it required by any rule.[32]

As also explained therein, the proper course of action that should have
been taken by the court a quo, upon manifestation of the parties of their
willingness to discuss a settlement, was to suspend the proceedings and
allow them reasonable time to come to terms (a) If willingness to discuss a
possible compromise is expressed by one or both parties; or (b) If it appears
that one of the parties, before the commencement of the action or proceeding,
offered to discuss a possible compromise but the other party refused the offer,
pursuant to Art. 2030 of the Civil Code. If despite efforts exerted by the trial
court and the parties the negotiations still fail, only then should the action
continue as if no suspension had taken place. [33]
Ostensibly, while the rules allow the trial court to suspend its proceedings
consistent with the policy to encourage the use of alternative mechanisms of
dispute resolution, in the instant case, the trial court only gave the parties
fifteen (15) days to conclude a deal. This was, to say the least, a passive and
paltry attempt of the court a quo in its task of persuading litigants to agree
upon a reasonable concession. Hence, if only to inspire confidence in the
[34]

pursuit of a middle ground between petitioner and respondents, we must not


interpret the trial courts Orders as dismissing the action on its own motion
because the parties, specifically petitioner, were anxious to litigate their case
as exhibited in their several manifestations and motions.

We reject respondent Uys contention that Goldloop Properties, Inc. v.


Court of Appeals is irrelevant to the case at bar on the dubious reasoning that
the complaint of petitioner was dismissed for failure to prosecute and not for
the non-submission of a compromise agreement which was the bone of
contention in that case, and that the dismissal imposed in the instant case
was without prejudice, in contrast to the dismissal with prejudice decreed in
the cited case. To begin with, whether the dismissal is with or without
prejudice if grievously erroneous is detrimental to the cause of the affected
party; Goldloop Properties, Inc. does not tolerate a wrongful dismissal just
because it was without prejudice. More importantly, the facts in Goldloop
Properties, Inc. involve, as in the instant case, a dismissal for failure to
prosecute on the ground of the parties inability to come up with a compromise
agreement within fifteen (15) days from notice of the courts order therein. All
told, the parallelism between them is unmistakable.

Even if we are to accept on face value respondents understanding


of Goldloop Properties, Inc. as solely about the failure to submit a compromise
agreement, it is apparent that the present case confronts a similar
problem. Perhaps initially the issue was one of failure to prosecute, as can be
observed from the Order dated 20 July 2000, although later reversed and set
aside. But thereafter, in the Order of 6 November 2000, the trial court refused
to proceed to pre-trial owing to the failure of the plaintiff to submit a
compromise agreement pursuant to the Order dated 8 September 2000.
When the civil case was stalled on account of the trial courts refusal to call the
parties to a pre-trial conference, the reason or basis therefor was the absence
of a negotiated settlement - a circumstance that takes the case at bar within
the plain ambit of Goldloop Properties, Inc. In any event, given that the instant
case merely revolves around the search for a reasonable interpretation of the
several Orders of the trial court, i.e., as to whether the dismissal without
prejudice was revived upon petitioners helplessness to perfect an out-of-court
arrangement, with more reason must we employ the ruling in Goldloop
Properties, Inc. to resolve the parties differences of opinion.

We also find nothing in the record to support respondent Uys conclusion


that petitioner has been mercilessly delaying the prosecution of Civil Case No.
99-518 to warrant its dismissal.A complaint may be dismissed due to plaintiffs
fault: (a) if he fails to appear during a scheduled trial, especially on the date
for the presentation of his evidence in chief, or when so required at the pre-
trial; (b) if he neglects to prosecute his action for an unreasonable length of
time; or (c) if he does not comply with the rules or any order of the court. None
of these was obtaining in the civil case.

While there was a lull of about six (6) months in the prosecution of Civil
Case No. 99-518, it must be remembered that respondents themselves
contributed largely to this delay. They repeatedly asked petitioner to consider
re-structuring the debt of respondent Magwin Marketing Corporation to which
petitioner graciously acceded. Petitioner approved a new debt payment
scheme that was sought by respondents, which it then communicated to
respondent Corporation through a letter for the conformity of the latters
officers, i.e., respondent Nelson Tiu as President/General Manager and
respondent Benito Sy as Director thereof. Regrettably, only respondent
Nelson Tiu affixed his signature on the letter to signify his concurrence with
the terms and conditions of the arrangement. The momentary lag in the civil
case was aggravated when respondent Benito Sy for unknown and
unexplained reasons paid no heed to the adjustments in the indebtedness
although curiously he has not opposed before this Court or the courts a
quo petitioners desire to go ahead with the pre-trial conference.

Admittedly, delay took place in this case but it was not an interruption that
should have entailed the dismissal of the complaint even if such was
designated as without prejudice. To constitute a sufficient ground for
dismissal, the inattention of plaintiff to pursue his cause must not only be
prolonged but also be unnecessary and dilatory resulting in the trifling of
judicial processes. In the instant case, the adjournment was not only fleeting
as it lasted less than six (6) months but was also done in good faith to
accommodate respondents incessant pleas to negotiate. Although the
dismissal of a case for failure to prosecute is a matter addressed to the sound
discretion of the court, that judgment however must not be abused. The
availability of this recourse must be determined according to the procedural
history of each case, the situation at the time of the dismissal, and the
diligence of plaintiff to proceed therein. Stress must also be laid upon the
[35]

official directive that courts must endeavor to convince parties in a civil case to
consummate a fair settlement, and to mitigate damages to be paid by the
[36]

losing party who has shown a sincere desire for such give-and-take. All [37]

things considered, we see no compelling circumstances to uphold the


dismissal of petitioners complaint regardless of its characterization as being
without prejudice.

In fine, petitioner cannot be said to have lost interest in fighting the civil
case to the end. A court may dismiss a case on the ground of non
prosequitur but the real test of the judicious exercise of such power is whether
under the circumstances plaintiff is chargeable with want of fitting
assiduousness in not acting on his complaint with reasonable
promptitude. Unless a partys conduct is so indifferent, irresponsible,
contumacious or slothful as to provide substantial grounds for dismissal, i.e.,
equivalent to default or non-appearance in the case, the courts should
consider lesser sanctions which would still amount to achieving the desired
end. In the absence of a pattern or scheme to delay the disposition of the
[38]

case or of a wanton failure to observe the mandatory requirement of the rules


on the part of the plaintiff, as in the case at bar, courts should decide to
dispense rather than wield their authority to dismiss. [39]

Clearly, another creative remedy was available to the court a quo to attain
a speedy disposition of Civil Case No. 99-518 without sacrificing the course of
justice. Since the failure of petitioner to submit a compromise agreement was
the refusal of just one of herein respondents, i.e., Benito Sy, to sign his name
on the conforme of the loan restructure documents, and the common concern
of the courts a quo was dispatch in the proceedings, the holding of a pre-trial
conference was the best-suited solution to the problem as this stage in a civil
action is where issues are simplified and the dispute quickly and genuinely
reconciled. By means of pre-trial, the trial court is fully empowered to sway the
litigants to agree upon some fair compromise.

Dismissing the civil case and compelling petitioner to re-file its complaint is
a dangerous, costly and circuitous route that may end up aggravating, not
resolving, the disagreement. This case management strategy is frighteningly
deceptive because it does so at the expense of petitioner whose cause of
action, perhaps, may have already been admitted by its adverse parties as
shown by three (3) of four (4) defendants not willing to contest petitioners
allegations, and more critically, since this approach promotes the useless and
thankless duplication of hard work already undertaken by the trial court. As we
have aptly observed, [i]nconsiderate dismissals, even if without prejudice, do
not constitute a panacea nor a solution to the congestion of court
dockets. While they lend a deceptive aura of efficiency to records of individual
judges, they merely postpone the ultimate reckoning between the parties. In
the absence of clear lack of merit or intention to delay, justice is better served
by a brief continuance, trial on the merits, and final disposition of the cases
before the court.[40]

WHEREFORE, the Petition for Review is GRANTED. The Decision dated


28 September 2001 and Resolution dated 2 April 2002 of the Court of Appeals
in CA-G.R. SP No. 62102 are REVERSED and SET ASIDE.

The Orders dated 8 September 2000, 6 November 2000 and 16


November 2000 of the Regional Trial Court, Branch 135, of Makati City,
docketed as Civil Case No. 99-518, are also REVERSED and SET ASIDE
insofar as these Orders are interpreted to impose upon and collect anew from
petitioner RIZAL COMMERCIAL BANKING CORPORATION docket or legal
fees for its complaint, or to dismiss without prejudice Civil Case No. 99-518, or
to preclude the trial court from calling the parties therein to pre-trial
conference, or from proceeding thereafter with dispatch to resolve the civil
case.

Civil Case No. 99-518 is deemed REINSTATED in, as it was never taken
out from, the dockets of the Regional Trial Court, Branch 135, of Makati
City. The trial court is ORDERED to exercise its jurisdiction over Civil Case
No. 99-518, to CONDUCT the pre-trial conference therein with dispatch, and
to UNDERTAKE thereafter such other proceedings as may be relevant,
without petitioner being charged anew docket or other legal fees in connection
with its reinstatement. Costs against respondents.

SO ORDERED.
THIRD DIVISION

[G.R. No. 145260. July 31, 2003]

CITY OF ILIGAN, Represented by Hon. FRANKLIN M. QUIJANO in His


Capacity as City Mayor, petitioner, vs. PRINCIPAL
MANAGEMENT GROUP, INC. (PMGI), Represented by Its
President & Chief Executive Officer, FERNANDO M.
SOPOT, respondent.

DECISION
PANGANIBAN, J.:

The ascertainment of good reasons for execution pending appeal lies


within the sound discretion of the trial court. Normally, its finding will not be
disturbed by a reviewing court, in the absence of grave abuse of discretion.

The Case

Before this Court is a Petition for Review under Rule 45 of the Rules of
[1]

Court, assailing the May 4, 2000 Decision and the July 14, 2000
[2]

Resolution of the Court of Appeals (CA) in CA-GR CV No. 56952. The


[3]

decretal portion of the Decision reads as follows:

WHEREFORE, the Petition for Certiorari is hereby DISMISSED. [4]

The assailed Resolution denied petitioners Motion for Reconsideration.

The Facts

The facts of the case are summarized by the CA in this wise:

On October 19, 1998, Mayor Franklin M. Quijano, acting for and in behalf of
[petitioner] City of Iligan, requested from the Sangguniang Panlungsod for: (a)
Resolution authorizing him to open a domestic Standby Letter of Credit (SLC)
in the amount of P14,000,000.00 in favor of the Land Bank Realty
Development Corporation and/or PNCC with the Principal Management
Group, Inc. (herein private respondent) as the funder/financial managers in
connection with the development of a project on a turn-key basis; and (b)
Resolution authorizing him to open a high yielding depository account with the
Land Bank of the Philippines in the amount of P14,000,000.00 as a hold-out
collateral for the domestic SLC.

The City Council approved Mayor Quijanos requests and passed Resolutions
Nos. 1050 and 1051 series of 1998 on October 20, 1998.

On December 29, 1998, a Memorandum of Agreement (MOA) on a turn-key


arrangement was drawn by Mayor Quijano, representing the City of Iligan,
with Land Bank Realty Development Corporation (LBRDC) as General
Contractor and Principal Management Group, Inc. (PMGI) as Developer -
Financing Manager. The project to be undertaken was the construction of a
Sports Complex which upon completion shall be turned over to Iligan City for
acceptance and the issuance of Certificate of Acceptance and Authority to Pay
to enable Land Bank Realty-PMGI to call on the SLC.

The project started on November 26, 1998 despite the fact that some
drawings had not yet been completed, since the MOA provides for a
construction period of one hundred twenty days from the date of the signing.

The construction site of the Sports Complex was donated by San Miguel
(Iligan) Enterprises, Inc. wherein the City of Iligan as donee was bound to
provide for all expenses for the transfer of the occupants therein.

On or about January 1999, the work on the project stopped due to the refusal
of some of the occupants to vacate the premises claiming that they have not
been paid x x x their disturbance compensation. By then, PMGI had already
accomplished 78.27% of the contracted project equivalent to P10,957,800.00
of the total project cost of P14,000,000.00.

On February 24, 1999, PMGI requested from the City of Iligan for a deductive
change order to enable it to collect the above-stated amount based on the
78.27% accomplishment of the project. The City of Iligan, however, claimed
that PMGIs accomplishment was only 52.89% or equivalent only
to P6,958,861.59 based on the Accomplishment Report as of February 9,
1999.
The City of Iligan refused to pay for the reason that the mutually agreed price
of P14 Million shall only be paid after the completion of the project and
acceptance by it and since the project is not yet complete, no payment can be
paid.

The problem on the payment of the affected occupant, which was the cause of
the work stoppage, was accordingly brought to the attention of the
Sangguniang Panlungsod which favorably acted on it through Resolution No.
99-765 dated June 8, 1999 authorizing the payment of the affected occupants
in the project site.

On November 8, 1999, PMGI filed a complaint against the City of Iligan for
rescission of the MOA and damages. After the filing of City of Iligans Answer,
a Motion for Partial Summary Judgment was filed by PMGI which claimed that
there was no genuine issue as to the fact of the obligation of the City of Iligan
since it admitted the accomplishment of 52.89% or equivalent
to P6,958,861.59 of PMGI and that the City of Iligan had not specifically
denied under oath the genuineness of the Letter of Credit and Memorandum
of Agreement.

An Opposition to the Motion for Partial Summary Judgment was filed by the
City of Iligan on December 7, 1999 which stated that: it never admitted that
PMGI made any accomplishment at all but merely stated that with respect to
the work accomplishment, it was only 52.89% based on the report of Engr.
Maatas team; the MOA or the contract for the construction of the sports
complex is between the City of Iligan, as owner, and the Land Bank Realty
Development Corporation as General Contractor, PMGI only entered into the
picture to support LBRDC in accordance with their own separate agreement;
the grounds of lack of cause of action and jurisdiction raised in the Answer
should be set for hearing; LBRDC as an indispensable party should be
impleaded; and the court does not have jurisdiction over the case in view of
Sec. 4 of Executive Order No. 1008 which vests exclusive jurisdiction over
construction disputes to Construction Industry Arbitration Commission (CIAC).

In private respondents Rejoinder to Opposition, it was alleged that PMGI and


LBRDC are solidary creditors, hence, there was no need to implead the latter
since the suit redounds to the benefit of LBRDC, there was no disagreement
or dispute as to the accomplishment of 52.89% or equivalent
to P6,958,861.59, hence, there was no need to resort to arbitration; and the
turn-key provision in the MOA is not applicable since the 120-day construction
period lapsed due to the failure of the City of Iligan to perform its obligation.

In the Order dated December 20, 1999, the trial court granted the Motion for
Partial Summary Judgment and rendered the following judgment/order:

WHEREFORE, foregoing premises considered, [respondents] motion is


GRANTED.

Partial summary judgment is hereby issued in favor of [respondent] in the


amount of Six Million Nine Hundred Fifty-eight Thousand Eight Hundred Sixty
one & 59/100 (P6,958,861.59) Pesos Only.

The Manager of the LAND BANK OF THE PHILIPPINES (Iligan City Branch),
or his authorized representative, or any competent officer of said bank is
hereby ORDERED to pay the amount of P6,958,861.59 out of LC NO.
98003/D to Mr. Fernando M. Sopot, President and CEO of [respondent].

In the event said LC NO. 98003/D is insufficient or has expired, the Manager
and/or any competent officer of said LAND BANK OF THE PHILIPPINES
(Iligan City Branch) is hereby ORDERED to pay to said Mr. Fernando M.
Sopot the amount of P6,958,861.59 out of any accounts or moneys of
[petitioner].

SO ORDERED.

The Motion for Reconsideration filed by the City of Iligan to the December 20,
1999 Order was denied in the Resolution dated January 17, 2000.

A Notice of Appeal was filed by the City of Iligan on January 26, 2000.

A Motion for Execution Pending Appeal x x x filed on January 18, 2000 by


PMGI which alleged that when the appeal is clearly dilatory, order for
execution upon good reasons may be issued with the discretion of the court,
was granted on January 24, 2000 over the opposition of the City of Iligan, to
justify the same, the dispositive portion of which was earlier quoted. The trial
court further stated that:

The Court is convinced that there are good reasons to allow the immediate
execution pending appeal. Its adjudication is based on [petitioners] own
admission hence, any appeal would be unmeritorious and would only serve to
delay execution of the final order subject of the instant motion. The fact that
an appeal in this case if taken by [petitioner] will be a merely dilatory tactic has
been declared by the Supreme Court as a good and sufficient reason upon
which to issue execution of the order under Section 2, Rule 39 of the Revised
Rules of Court.

A Demand Letter and Notice of Garnishment, both dated January 26, 2000,
were served on even date by Sheriff Montoy B. Lomondot to herein petitioner.
(Citations omitted)
[5]

Ruling of the Court of Appeals

The CA held that the trial court did not commit grave abuse of discretion in
granting the execution pending appeal since the appeal filed by petitioner was
a dilatory tactic and is not allowed in the first place. Ruling that the trial court
[6]

could grant executions pending appeal, provided that a good reason therefor
was stated in a special order, the appellate court upheld dilatory tactic as one
such good reason.

The appellate court also ruled that certiorari would not be allowed in this
case, because there were other remedies still available to petitioner, like the
filing of a supersedeas bond to stay the execution or the filing of a motion for
reconsideration.

Hence, this Petition. [7]

The Issues

Petitioner raises the following issues for our consideration:

Whether or not the Honorable Court of Appeals erred in affirming the Order of
the trial court granting a Writ of Execution Pending Appeal to implement its
previous Order dated December 20, 1999 approving respondents Motion for
Partial Summary Judgment;

B
Whether or not the Honorable Court of Appeals erred in affirming the Order of
the trial court that there were good reasons to allow the immediate execution
pending appeal; and

Whether or not the Honorable Court of Appeals erred in affirming the Order of
the trial court in spite of the latters failure to take into consideration the
provision in paragraph 8 of the Memorandum of Agreement entered into by
the herein parties. (Citations omitted)
[8]

Simply put, the main issue is whether the Order granting execution
pending appeal was proper.

The Courts Ruling

The Petition has no merit.

Main Issue:

Propriety of Execution Pending Appeal

Executions pending appeal are governed by Section 2 of Rule 39 of the


Rules of Court, which reads:

SEC. 2. Discretionary execution.--

(a) Execution of a judgment or a final order pending appeal. On motion of the


prevailing party with notice to the adverse party filed in the trial court while it
has jurisdiction over the case and is in possession of either the original record
or the record on appeal, as the case may be, at the time of the filing of such
motion, said court may, in its discretion, order execution of a judgment or final
order even before the expiration of the period to appeal.

After the trial court has lost jurisdiction, the motion for execution pending
appeal may be filed in the appellate court.

Discretionary execution may only issue upon good reasons to be stated in a


special order after due hearing.
There are three requisites for the execution of a judgment pending
appeal: a) a motion must be filed by the prevailing party with notice to the
adverse party; b) there must be good reasons for execution pending appeal;
and c) the good reasons must be stated in a special order. [9]

Execution pending appeal is, of course, the exception to the general rule.
Normally, execution cannot be obtained until and unless (a) the judgment
[10]

has become final and executory; (b) the right of appeal has been renounced
or waived; (c) the period for appeal has lapsed without an appeal having been
filed; or (d) having been filed, the appeal has been resolved and the records of
the case have been returned to the court of origin -- in which case, execution
shall issue as a matter of right. [11]

On the other hand, when the period of appeal has not yet expired, the
execution of a judgment should not be allowed except if, in the courts
discretion, there are good reasons therefor. [12]

Since the execution of a judgment pending appeal is an exception to the


general rule, the existence of good reasons is essential. These reasons must
be stated in a special order, because unless these are divulged, it will be
difficult to determine on appeal whether judicial discretion has been properly
exercised by the lower court. [13]

Good reasons consist of compelling circumstances that justify the


immediate execution of a judgment, lest it become illusory; or the prevailing
party be unable to enjoy it after the lapse of time, considering the tactics of the
adverse party who may have no recourse but to delay. [14]

In the present case, the good reason relied upon by both the trial and the
appellate courts was that the partial adjudication of the case was based on
petitioners own admission; hence, any appeal based on that point would be
unmeritorious and merely dilatory. Indeed, both courts ruled that an appeal by
petitioner would only serve as a good and sufficient reason upon which to
issue execution. [15]

The ascertainment of good reasons for execution pending appeal lies


within the sound discretion of the trial court, and the appellate court will not
normally disturb such finding.Intervention by the latter may be proper, if it is
shown that there has been an abuse of discretion. [16]
Like the CA, we find no abuse of discretion in the trial courts grant of
execution pending appeal. Indeed, this Court has held that a good and
sufficient reason upon which to authorize immediate execution is when an
appeal is clearly dilatory.
[17]

Normally, the trial court is not allowed to assess its own judgment and to
hold that an appeal may not prosper, or that it would merely be dilatory. In the
present case, however, there are circumstances that undisputedly serve as
cogent bases for arriving at such a conclusion.

First, it is not seriously disputed that the judgment is anchored upon


material facts as follows: (1) there is a Memorandum of Agreement (MOA) for
the site development of Sports Complex Project No. 1 signed by the parties;
(2) petitioner failed to pay the occupants of the project site on time, thereby
preventing respondent from fully complying with its obligation under the MOA;
(3) respondent admitted that the work accomplished was 52.89 percent, which
was equivalent to P6,958,861.59. Obviously, there is no genuine issue as to
any material fact on this point.

Second, Article 1191 of the Civil Code states:

The power to rescind obligations is implied in reciprocal ones, in case one of


the obligors should not comply with what is incumbent upon him.

The injured party may choose between the fulfillment and the rescission of the
obligation, with the payment of damages in either case. x x x.

By failing to pay the occupants of the project site within the time required
for the completion of the project, petitioner did not comply with what was
incumbent upon it. Applying the law to the undisputed facts, the trial court had
prima facie bases for rendering its partial summary judgment holding that
respondent was entitled to rescission and to the payment of P6,958,861.59.

Verily, the trial court committed no abuse of discretion in granting


execution pending appeal. Its conclusion was upheld by the CA, which found
that the appeal filed by the petitioner was a dilatory tactic and was not allowed
in the first place. Consequently, the appellate court did not err in refusing to
attribute grave abuse of discretion to the trial courts Order granting execution
pending appeal.
WHEREFORE, the Petition is DENIED and the assailed Decision and
Resolution AFFIRMED. Costs against petitioner.

SO ORDERED.

FIRST DIVISION

[G.R. No. 136726. September 24, 2003]

PANFILO V. VILLARUEL, JR., petitioner, vs. REYNALDO D.


FERNANDO, MODESTO ABARCA, JR. and MARILOU M.
CLEOFAS, respondents.

DECISION
CARPIO, J.:

The Case

This petition for review on certiorari seeks to reverse the Decision of the
[1] [2]

Court of Appeals in CA-G.R. SP No. 48233 dated 30 September 1998


[3]

denying due course to the petition for certiorari filed by Panfilo V. Villaruel, Jr.
[4]

and the Resolution dated 3 December 1998 denying the motion for
reconsideration.
The Facts

Petitioner Panfilo V. Villaruel, Jr. (petitioner) is the former Assistant


Secretary of the Air Transportation Office (ATO), Department of Transportation
and Communication (DOTC).Respondents Reynaldo D. Fernando, Modesto
E. Abarca, Jr. (Abarca), and Marilou M. Cleofas are the Chief, Chief
Administrative Assistant, and Administrative Assistant, respectively, of the Civil
Aviation Training Center (CATC). The CATC is an adjunct agency of the ATO
tasked to train air traffic controllers, airway communicators and related civil
aviation personnel for the local aviation industry as well as for the Southeast
Asian and Pacific region.

Petitioner issued a memorandum dated 27 April 1995 addressed to the


respondents, detailing them to the Office of DOTC Undersecretary Primitivo C.
Cal effective 2 May 1995.

On 29 April 1995, respondents wrote to DOTC Secretary Jesus B. Garcia


and Undersecretary Josefina T. Lichauco through petitioner requesting for
reconsideration of the detail order.

On 7 May 1995, in compliance with the detail order, respondents reported


to the Office of Undersecretary Cal at DOTC.

Without acting on respondents request for reconsideration, petitioner


issued a memorandum on 19 July 1995 addressed to Abarca placing him
under preventive suspension for 90 days without pay pending investigation for
alleged grave misconduct.

On 10 August 1995, respondents requested Secretary Garcia to lift the


detail order and to order their return to their mother unit since more than 90
days had already lapsed. Respondents also sought the intervention of the
Ombudsman in their case. As a result, the Ombudsman inquired from
Secretary Garcia the action taken on respondents request for reconsideration
of the detail order.

On 22 November 1995, Secretary Garcia replied to the Ombudsman that


he had issued a memorandum dated 9 November 1995 directing petitioner to
recall respondents to their mother unit. Secretary Garcia declared that the law
does not sanction the continuous detail of respondents.
Despite repeated demands by respondents, petitioner failed and refused
to reinstate respondents to their mother unit.

On 24 January 1996, respondents filed a Petition for Mandamus and


Damages with Prayer for a Preliminary Mandatory Injunction against petitioner
with the Regional Trial Court of Pasay City docketed as Civil Case No. 96-
0139. Respondents prayed for the following:

P R AY E R

WHEREFORE, premises considered, petitioners herein respectfully pray of this


Honorable Court that:

1. Pending the determination of the merits of this petition, a writ of preliminary


mandatory injunction be issued ex-parte directing respondent Panfilo V. Villaruel, Jr.,
to recall the petitioners herein within twenty four (24) hours from receipt hereof to
their mother unit, the Civil Aviation Training Center, Air Transportation Office,
DOTC, and to forthwith allow them to assume, perform and discharge the functions,
duties and responsibilities inherent, appurtenant and incident to their respective
offices.

2. After hearing on the merits, judgment be rendered confirming the writ of


preliminary mandatory injunction earlier issued by this Honorable Court and declaring
the same permanent, and ordering the respondent Panfilo Villaruel, Jr., to pay
petitioners herein the following damages, to wit:

a) to pay petitioner Reynaldo D. Fernando the amount of P50,000 as actual and


compensatory damages;

b) to pay petitioners herein moral, exemplary and temperate damages, in such


amounts as may hereafter be proven in the course of trial, which petitioners herein are
leaving to the sound discretion of this Honorable Court to determine and adjudge;

c) to pay petitioners herein attorneys fees in the amount of P100,000;

d) to pay petitioners herein the costs of suit.

Petitioners herein pray for such other and further relief as may be just and equitable in
the premises. [5]
On 23 February 1996, the trial court granted respondents prayer for a
preliminary mandatory injunction.

Meanwhile, Judge Aurora Navarette-Recia of the trial court was appointed


Chairman of the Commission on Human Rights. Consequently, the case was
re-raffled and assigned to Branch 231 of the Regional Trial Court, Pasay City. [6]

On 12 April 1996, the trial court issued an order modifying the 23 February
1996 order of Judge Recia. The trial court issued a writ of preliminary
mandatory injunction ordering petitioner to comply with the 9 November 1995
order of Secretary Garcia directing petitioner to recall respondents to their
mother unit until further orders by the trial court.

For petitioners continued failure to comply with the writ of preliminary


injunction, respondents moved to cite petitioner in contempt. Respondents
also moved to declare petitioner in default for not filing an answer within the
period prescribed in the trial courts order of 26 January 1996.

On 28 May 1996, the trial court granted the motion and declared petitioner
guilty of indirect contempt. The trial court issued a bench warrant against
petitioner.

Petitioner, through the Office of the Solicitor General (OSG), filed a special
civil action for certiorari with the Court of Appeals assailing the trial courts
[7]

order finding petitioner guilty of indirect contempt. The case was docketed as
CA-G.R. SP No. 41263.

Meanwhile, the trial court declared petitioner in default for his failure to file
an answer to the petition for mandamus and damages. Accordingly,
respondents adduced their evidence ex-parte before the Clerk of Court.

On 11 July 1996, the trial court rendered a Decision the dispositive portion
of which reads:

Wherefore, considering the foregoing premises, judgment is hereby rendered in favor


of the petitioners and against the respondent declaring mandamus permanent and
thereby ordering respondent Panfilo V. Villaruel, Jr., to pay the following:

(1) One hundred thousand pesos (P100,000.00) each as moral damages;


(2) Twenty five thousand pesos (P25,000.00) each as exemplary damages;

(3) Twenty five thousand pesos (P25,000.00) each as temperate damages,


and;

(4) Fifty thousand pesos (P50,000.00) as attorneys fees.

SO ORDERED. [8]

Aggrieved, petitioner, represented by the OSG, appealed to the Court of


Appeals. The appeal was docketed as CA-G.R. SP No. 42447. With the filing
[9]

of the appeal, the Court of Appeals granted respondents motion for the
dismissal of the petition for certiorari in CA-G.R. SP No. 41263 for being moot
and academic.

The Court of Appeals granted the OSG a non-extendible extension until 13


December 1996 within which to file petitioners memorandum. However, the
OSG failed to file the memorandum. Subsequently, Solicitor Restituto Tuando,
Jr. who was handling the case was appointed Regional Trial Court judge of
Dumaguete City. The case was re-assigned to Assistant Solicitor Luciano
Joson, Jr. On 13 March 1997, the Court of Appeals issued a Resolution
dismissing petitioners appeal for failure to file the required memorandum. The
OSG, through Assistant Solicitor Luciano Joson, Jr., filed a Motion for
Reconsideration, but the Court of Appeals denied the same. The Resolution
became final and executory on 14 June 1997.

Consequently, the respondents filed a Motion for Execution with the trial
court. Although served a copy of the motion for execution, the OSG did not file
any opposition.

Acting on the motion for execution, the trial court issued a Writ of
Execution on 22 September 1997. On 3 February 1998, the Sheriff issued a
Notice of Sheriffs Sale setting on 23 February 1998 the sale of petitioners real
property covered by Transfer Certificate of Title No. 83030.

On 17 February 1998, petitioner, through his new counsel, filed a Motion


[10]

to Quash the Writ of Execution and to Suspend Sheriffs Sale. In his motion,
petitioner alleged that the trial courts decision never became final and
executory as the trial court deprived him of his right to due process. Petitioner
claimed that the OSG failed to file petitioners memorandum in CA-G.R. SP
No. 42447 resulting in the dismissal of his appeal. Furthermore, petitioner
alleged that the OSG failed to inform him of the dismissal of his appeal and of
the trial courts order granting respondents motion for execution. Petitioner
further asserted that the Resolution of the Ombudsman in OMB-ADM 0-96-
0090 superseded the decision of the trial court. The Ombudsmans
[11]

Resolution approved the following recommendation of the reviewing Assistant


Ombudsman:

PREMISES CONSIDERED, respondent MODESTO ABARCA, JR., is hereby found


GUILTY of violation of Section 7(d) of Republic Act 6713, for which the penalty of
Suspension Without Pay for Six (6) Months is hereby recommended pursuant to
Section 10(b), Rule III of Administrative Order No. 07, in relation to Section 25(2) of
Republic Act No. 6770.

It is also respectfully recommended that the charge against respondents REYNALDO


FERNANDO and MARY LOU CLEOFAS be DISMISSED. [12]

On 23 February 1998, the trial court issued an Order quashing the Writ of
Execution because the Sheriff failed to follow Section 9, Rule 39 of the Rules
of Court. The trial court, however, issued an Alias Writ of Execution. Petitioner
filed a Motion for Reconsideration but the trial court denied the same on 28
April 1998.

Dissatisfied with the trial courts orders, petitioner filed a special civil action
for certiorari with the Court of Appeals docketed as CA-G.R. SP No. 48233
assailing the execution of the trial courts decision of 11 July 1996. The Court
of Appeals denied due course to the petition for certiorari and dismissed the
same in the Decision dated 30 September 1998. Petitioner moved for
reconsideration but the appellate court denied the motion in a Resolution of 3
December 1998.

Hence, the instant petition.

The Ruling of the Court of Appeals

Petitioner raised before the Court of Appeals the following issues:

1. THE TRIAL COURTS DECISION DATED JULY 11, 1996 IS VOID FOR
LACK OF DUE PROCESS AND COULD NOT HAVE BECOME FINAL
AND EXECUTORY.
2. SUPERVENING FACTS AND CIRCUMSTANCES HAVE TRANSPIRED
WHICH RENDERED EXECUTION OF THE JUDGMENT UNJUST AND
INEQUITABLE. [13]

On the first issue, the Court of Appeals ruled that the negligence of the
OSG could not relieve petitioner of the effects of such negligence and prevent
the decision of the trial court from becoming final and executory. In short, the
OSGs negligence binds petitioner.

The Court of Appeals admonished petitioner for his failure to ascertain


periodically from the OSG or from the Court of Appeals the status of his
appeal. The appellate court cited Reyes v. Court of Appeals, which held
[14]

that it is the duty of a party litigant to make inquiries to his counsel on matters
concerning his case. A party litigant bears the responsibility of contacting his
lawyer periodically to apprise himself of the progress of the case. A lawyers
negligence binds a party litigant who must suffer the consequences of such
negligence. The Court of Appeals further held that there was no proof that the
OSG failed to inform petitioner of the dismissal of his appeal.

On the second issue, the Court of Appeals concurred with the trial courts
ruling that the nature of the case before the Ombudsman is different from the
case before the trial court. The former deals with a violation of Republic Act
No. 6713 (RA 6713) punished with suspension from office while the latter
[15]

deals with an ultra vires act punished with damages. The appellate court ruled
that the findings of the Ombudsman had nothing to do with the findings of the
trial court, as the two forums are separate and distinct from each other.

Moreover, the Court of Appeals opined that petitioner failed to prove that
the trial court committed grave abuse of discretion to warrant the writ of
certiorari. The appellate court ruled that the trial court acted in accord with law
and prevailing jurisprudence in issuing the questioned orders.

The Issues

Petitioner presents the following issues for resolution of this Court: [16]

1. Whether the award of moral, exemplary and temperate damages to respondents


has legal basis.
2. Whether the trial court correctly ruled that the negligence of the OSG could not
relieve petitioner of the effects of such negligence and prevent the decision of
the trial court from becoming final and executory.

3. Whether petitioner was denied of his right to due process when the appellate
court dismissed his appeal for failure of the OSG to file the memorandum.

4. Whether the resolution of the Ombudsman finding Modesto Abarca, Jr. guilty
of violating Section 7 of RA 6713 rendered the execution of the trial courts
decision unjust and inequitable.

The main issue to resolve is whether the Court of Appeals erred in


dismissing the petition for certiorari assailing the trial courts orders dated 23
February 1998 and 28 April 1998.Resolving this issue necessarily determines
the validity of the questioned orders. This in turn resolves the questions of
whether the trial court denied petitioner of his right to due process and
whether the Ombudsmans resolution rendered the execution of the trial courts
decision unjust and inequitable.

We can no longer resolve the issue regarding the validity and


reasonableness of the award of damages for three reasons. First, the decision
of the trial court dated 11 July 1996 is already final and executory. Second, the
petition for certiorari filed by petitioner was simply a direct consequence of the
trial courts issuance of the writ of execution and notice of sheriffs sale. In other
words, petitioner merely questioned the execution of the trial courts decision
in his petition for certiorari. Third, petitioner did not raise the issue of the
validity and reasonableness of the award of damages before the Court of
Appeals. [17]

The Courts Ruling

The petition has no merit.

We begin by pointing out that petitioner failed to allege the essential


requisites under Section 1, Rule 65 of the Rules of Court for a petition
for certiorari to prosper. Specifically, petitioner never alleged that the trial court
acted without or in excess of its jurisdiction in issuing the questioned
orders. Neither did petitioner allege that the trial court gravely abused its
discretion amounting to lack or excess of jurisdiction, and there is no appeal,
or any plain, speedy, and adequate remedy in the ordinary course of law. In
other words, there is no issue that the trial court committed grave abuse of
discretion amounting to lack or excess of jurisdiction in handing down the
questioned orders. On this score alone, the dismissal of the petition for
certiorari before the Court of Appeals is in order. However, in disposing of the
instant case, we shall still resolve the principal issues raised by petitioner.

No Denial of Petitioners Right to Due Process

Petitioner essentially contends that the judgment of the trial court in Civil
Case No. 96-0139 is void for lack of due process. Petitioner alleges that the
trial court never gave him the chance to be heard and to submit his evidence.
Petitioner, formerly represented by the OSG, failed to file an answer to
respondents petition for mandamus and damages. Consequently, the trial
court declared petitioner in default. While the OSG filed a notice of appeal of
the judgment by default, it failed to file with the Court of Appeals the required
memorandum resulting in the dismissal of the appeal. In petitioners words, the
OSG virtually abandoned his case. Petitioner argues that the inexcusable
[18]

negligence of the OSG did not bind him and prevented the decision of the trial
court from becoming final and executory.

We do not agree.

Due process, in essence, is simply an opportunity to be heard and this [19]

opportunity was not denied petitioner. Throughout the proceedings in the trial
court as well as in the Court of Appeals, petitioner had the opportunity to
present his side but he failed to do so. Clearly, petitioners former counsel, the
OSG, was negligent. This negligence, however, binds petitioner. The trial and
appellate courts correctly ruled that the negligence of the OSG could not
relieve petitioner of the effects such negligence and prevent the decision of
[20]

the trial court from becoming final and executory.

In Villa Rhecar Bus v. De la Cruz, which petitioner himself cited, the


[21]

Court ruled:

It is unfortunate that the lawyer of the petitioner neglected his responsibilities to his
client. This negligence ultimately resulted in a judgment adverse to the client. Be that
as it may, such mistake binds the client, the herein petitioner. As a general rule, a
client is bound by the mistakes of his counsel. Only when the application of the
general rule would result in serious injustice should an exception thereto be called
for. Under the circumstances obtaining in this case, no undue prejudice against the
petitioner has been satisfactorily demonstrated. At most, there is only an unsupported
claim that the petitioner had been prejudiced by the negligence of its counsel, without
an explanation to that effect. (Emphasis supplied)

In the present case, there was no proof that petitioner suffered serious
injustice to exempt him from the general rule that the negligence of the
counsel binds the client. Petitioner did not even attempt to refute the
respondents allegations in the petition for mandamus and damages.

Moreover, petitioner is not entirely blameless for the dismissal of his


appeal. After the OSGs failure to file the answer to the petition for mandamus
and damages and to have the order declaring petitioner in default lifted,
petitioner should have already replaced the OSG with another
lawyer. However, petitioner still retained the services of the OSG, despite its
apparent lack of interest in petitioners case, until the trial courts decision
became final. In Salva v. Court of Appeals, the Court declared:
[22]

Respondents reliance on Legarda is inapropos. Notably, the decision in said case was
not yet final in 1991. The private respondent therein then filed a timely motion for
reconsideration. In granting the motion for reconsideration, the Court en banc held:

xxx

Neither Cathay nor Cabrera should be made to suffer for the gross negligence of
Legardas counsel. If she may be said to be innocent because she was ignorant of the
acts of negligence of her counsel, with more reason are respondents truly innocent.
xxx In this case, it was not respondents, but Legarda, who misjudged and hired the
services of the lawyer who practically abandoned her case and who continued to
retain him even after his proven apathy and negligence.

At any rate, we find that respondent Governor Sato, as well as the Province of
Occidental Mindoro which she represents, were not denied their day in
court. Responsive pleadings were filed before the lower courts, and respondent was
given all the opportunities to prove her case. Her chosen counsel did not diligently
exhaust all legal remedies to advance respondents cause, yet respondent did not
terminate his services. She was aware of the repeated negligence of her counsel and
cannot now complain of counsels errors. Hence, there is no justifiable reason to
exempt her from the general rule that clients should suffer the consequences of the
negligence, mistake or lack of competence of the counsel whom they themselves
hired and had the full authority to fire at any time and replace with another even
without justifiable reason. (Emphasis supplied)

Furthermore, petitioner cannot now complain of the OSGs errors.


Petitioner should have taken the initiative of making periodic inquiries from the
OSG and the appellate court about the status of his case. Litigants [23]

represented by counsel should not expect that all they need to do is sit back,
relax and await the outcome of their case. To agree with petitioners stance
[24]

would enable every party to render inutile any adverse order or decision
through the simple expedient of alleging negligence on the part of his counsel.
The Court will not countenance such ill-founded argument which contradicts
[25]

long-settled doctrines of trial and procedure. [26]

The Ombudsmans Resolution Does Not Render the Execution

of the Trial Courts Decision Unjust and Inequitable

Petitioner contends that the Ombudsmans Resolution finding Abarca guilty


of violating Section 7(d) of RA 6713 superseded the trial courts decision
finding petitioner liable for damages.Petitioner insists that the Ombudsmans
resolution rendered the execution of the trial courts decision unjust and
inequitable.

We are not persuaded.

Settled is the rule that a judgment that has acquired finality becomes
immutable and unalterable and may no longer be modified in any respect
except only to correct clerical errors or mistakes. True, this rule admits of
[27]

certain exceptions. One of these exceptions is whenever circumstances


transpire after the finality of the decision rendering its execution unjust and
inequitable. This, however, is not the case here. In the present case, the
[28]

Ombudsman issued his Resolution prior to the finality of the trial courts
decision. The Ombudsman issued his Resolution on 22 January 1997 while
the trial courts decision became final and executory on 14 June
1997. Therefore, the resolution of the Ombudsman is not a supervening event
to warrant the stay of the execution of the decision of the trial court.

Furthermore, the resolution of the Ombudsman finding Abarca guilty of


violating Section 7(d) of RA 6713 did not and could not supersede the
decision of the trial court holding petitioner liable for damages. The action filed
by the petitioner before the Ombudsman is completely different from the
action instituted by respondents before the trial court. The two actions, which
are clearly separate and distinct from each other, presented two different
causes of action. Petitioners cause of action arose from respondents alleged
violation of certain provisions of RA 6713 whereas respondents cause of
action resulted from petitioners refusal to recall respondents to their mother
unit at CATC. In the administrative case before the Ombudsman, the issue
was whether respondents were guilty of violating RA 6713. In contrast, the
issue in the civil action before the trial court was whether respondents were
entitled to the issuance of the writ of mandamus and damages.

The findings of the Ombudsman did not render the execution of the trial
courts decision unjust and inequitable. The resolution of the Ombudsman
finding Abarca guilty of violating Section 7(d) of RA 6713 did not state that
petitioner had a valid reason to detail respondents to the Office of
Undersecretary Cal. In fact, the Ombudsman dismissed the charges against
Reynaldo Fernando and Mary Lou Cleofas. Thus, the trial court correctly
awarded damages to respondents. Contrary to petitioners contention,
awarding damages to respondents does not amount to rewarding respondents
for their alleged wrongdoing. The award merely compensates respondents for
petitioners own unlawful acts. Clearly illegal were petitioners acts of
unjustifiably detailing respondents to the office of DOTC Undersecretary Cal
and refusing to comply with the 9 November 1995 directive of Secretary
Garcia to recall immediately respondents to their mother unit.

WHEREFORE, we DENY the instant petition. The Decision of the Court of


Appeals in CA G.R. SP No. 48233 dated 30 September 1998 and the
Resolution dated 3 December 1998 are AFFIRMED. No costs.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, and Ynares-Santiago, JJ., concur.

Azcuna, J., on leave.


THIRD DIVISION

[A.M. No. MTJ-03-1513. November 12, 2003]

Spouses JAIME and PURIFICACION MORTA, complainants vs. Judge


ANTONIO C. BAGAGAN, Municipal Trial
Court, Guinobatan, Albay; and Sheriff DANILO O. MATIAS,
Regional Trial Court, Branch 14, Ligao, Albay, respondents.

DECISION
PANGANIBAN, J.:

Unreasonable delay in resolving motions opens a judge to administrative sanctions.


Likewise, a sheriff is administratively liable for delayed implementation of a writ of
execution and failure to render the required reports thereon. These are necessary
lessons from the time-honored principle that justice delayed is justice denied.

The Case and the Facts

In their Administrative Complaint dated July 26, 2001, Spouses Jaime


[1]

and Purificacion Morta Sr. charged Judge Antonio C. Bagagan of the Municipal Trial
Court (MTC) of Guinobatan, Albay with gross ignorance of the law, incompetence, bias
and delay. They also indicted Sheriff Danilo O. Matias of the Regional Trial Court (RTC)
of Ligao, Albay (Branch 14) with gross ignorance of the law, negligence and connivance
with the defendants in Civil Case Nos. 481 and 482 (MTC, Guinobatan, Albay). The
Office of the Court Administrator (OCA) summarized the factual antecedents as follows:

x x x [In] a Complaint-Affidavit dated July 26, 2001 (with enclosures),


x x x [Spouses] Jaime and Purificacion Morta[,] through their counsel[,] Atty. Rodolfo
R. Paulino[,] charg[ed] [Respondent] Judge Antonio C. Bagagan and
Sheriff Danilo O. Matias with gross ignorance of the law and procedure,
incompetence, bias and delay in the disposition of Civil Case No. 481, entitled
Jaime Morta, Sr. and Purficacion Padilla vs. Jamie Occidental and Atty.
Mariano Baranda, Jr., for Damages with Prayer for a Writ of Preliminary Injunction,
and Civil Case No. 482 entitled Jaime Morta, Sr. and PurficacionPadilla vs. Jamie
Occidental, Atty. Mariano Baranda, Jr. and Daniel Corral, for Damages with Prayer
for a Writ of Preliminary Injunction.

Complainants, who are the plaintiffs in the aforementioned civil cases, allege[d] that
on March 29, 1994[,] the Municipal Trial Court [of] Guinobatan, Albay rendered a
decision in their favor. The decretal portion of the decision reads:

WHEREFORE, in view of the foregoing considerations, judgment is rendered in favor


of the plaintiffs and against the defendants in both cases as follows:

1) Ordering the defendants not to molest and disturb the peaceful possession
of the plaintiffs in the lands in question situated at San
Rafael, Guinobatan;

2) Condemning the defendants in Civil Case No. 481 to jointly and severally
pay the plaintiffs the total amount of P8,130.00 representing the value of
the coconuts, pili nuts and anahaw leaves and for the destroyed plants;

3) Ordering the defendants in Civil Case No. 481 jointly and severally to
reimburse the plaintiffs the amount of P202.00 as legal expenses
incurred in filing their suit;

4) Condemning the defendants in Civil Case No. 482 jointly and severally to
pay the plaintiffs the total amount of P9,950.00 representing the value of
the coconuts and anahaw leaves;

5) Ordering the said defendants in Civil Case No. 482 to jointly and severally
reimburse the plaintiffs the sum of P202.00 as legal expenses in filing
this suit.

The defendants appealed to the Regional Trial Court [of] Ligao, Albay. In its decision
dated August 10, 1994, the Regional Trial Court [RTC] dismissed the aforesaid cases
on the ground that the claims for damages are tenancy-related problems which fall
under the original and exclusive jurisdiction of the Department of Agrarian Reform
Adjudicatory Board (DARAB). On September 9, 1994, the plaintiffs filed a petition
for review with the Court of Appeals assailing the decision of the RTC. However, in
its decision dated May 31, 1995, the Court of Appeals affirmed the lower courts ruling
that the cases fall within the original and exclusive jurisdiction of
DARAB. Thereafter, the First Division of this Court, acting on the petition for review
on certiorari filed by the plaintiffs, rendered its decision dated June 10, 1999 in G.R.
No. 123417 affirming the decision of the Municipal Trial Court, Guinobatan, Albay in
Civil Case Nos. 481 and 482 and thereby setting aside the decision of the Court of
Appeals in CA-GR SP No. 35300 and that of the Regional Trial Court in Civil Cases
Nos. 1751 and 1752.

They now complain that despite the fact that the decision of the Supreme Court in the
aforesaid case had already become final and executory, the respondent Judge still
refused to issue a writ of possession in their favor.

Complainants further allege that on June 6, 2000 they filed a motion to cite Jaime
Occidental for contempt of court. Although more than one (1) year had already
elapsed since the motion was filed in the respondent Judges sala, the same had
remained unresolved up to the filing of the instant complaint.

As against the respondent Sheriff, the complainants aver[red] that through his
ignorance, negligence and connivance with the defendants, he failed to execute in full
the writ of execution that had been previously issued by the court in Civil Case Nos.
481 and 482. Moreover, it took respondent Sheriff a long time before he finally
submitted his Sheriff's Return of Service on the Writ of Execution.[2]

In his Answer/Comment dated April 2, 2002, respondent judge explained that he


[3]

had denied complainants Motion for the issuance of a writ of possession because, by
the time Civil Case Nos. 481 and 482 were finally decided by this Court on June 10,
1999, they had already been ousted from the lots in question pursuant to the Decisions
in DARAB Case No. 2413 and Civil Case No. 1920. In Civil Case No. 1920, respondent
judge ordered complainants to vacate the disputed lots. A Writ of Execution/Demolition
was thereafter issued on January 29, 1998. On the other hand, the DARAB Decision,
which became final and executory on October 27, 1998, directed them to cease and
desist from disturbing the peaceful possession of therein Petitioner Jaime Occidental.

Regarding the alleged delay in the resolution of the Motion for Contempt filed by
complainants, respondent judge contended that an ocular inspection and a hearing had
been conducted by his court as early as June 16, 2000, to determine if their Motion had
any basis. With the consent of their counsel, the hearing had to be deferred, however,
pending receipt of the Sheriffs Report in Civil Case No. 1920.

For his part, Respondent Sheriff Matias admitted in his Comment dated April 18,
[4]

2002, that there was delay in the full implementation of the Writ of Execution in Civil
Case Nos. 481 and 482. Explaining that the delay was due to his heavy workload and
thus unintentional, he begged for compassion from this Court.

Evaluation and Recommendation of the OCA

The OCA found that the explanation of respondent judge for not granting the Motion
for Execution, filed by complainants, was sufficient. According to the court administrator,
the records showed that they had indeed been evicted from the lots they were claiming
when Civil Case Nos. 481 and 482 were finally decided by the Supreme Court on June
10, 1999. Moreover, it emphasized that this Court had merely affirmed the Decision of
[5]

the MTC insofar as the award of damages was concerned.

As to complainants Motion to cite Occidental in contempt, the OCA held that the
delay was due primarily to the need of the court to clarify some important matters, not to
the negligence or partiality of respondent. Accordingly, it recommended that the charges
against him be dismissed for lack of merit.

On the other hand, the OCA found that Sheriff Matias had failed to implement the
Writ of Execution promptly and efficiently. It recommended that he be ordered to pay a
fine of P1,000, with a warning that a repetition of the same or a similar act in the future
would be dealt with more severely.

The Courts Ruling

We modify the OCAs findings and recommended penalties, consistent with Rule
140 of the Revised Rules of Court and the Revised Uniform Rules on Administrative
Cases in the Civil Service.

Administrative Liability

We agree with the OCA that respondent judge acted correctly in not issuing a writ of
execution/possession. His action was consistent with the Decision of this Court in GR
No. 123417 affirming that of the MTC as to damages. Besides, the latters Order
directing defendants not to molest complainants in their peaceful possession was
rendered moot when they were ousted from the disputed lots by virtue of the final
and executory judgments in Civil Case No. 1920 and DARAB Case No. 2413. Indeed,
the execution of a final judgment may be refused, as in this case, when there has been
a change in the situation of the parties that would make its execution inequitable.[6]

The delay in the resolution of complainants Motion, however, is an altogether


different matter. The Code of Judicial Conduct enjoins trial court judges, as paragons of
justice in the first instance, to dispose of the courts business promptly and to decide
[7]

cases and motions within the required periods. Section 15(1) of Article VIII of the
[8]

Constitution mandates them to do so within three months from the date of submission
for decision or final resolution. This Court, through Administrative Circular No. 1, also
[9]

specifically requires all of them to act promptly on all motions and interlocutory matters
pending before their courts. [10]

Hence, it is well-settled that the unexplained failure of judges to decide cases and
resolve motions and incidents within the reglementary period of 90 days, which is fixed
by the Constitution and the law, renders them administratively liable. We have [11]

stressed often enough that delay in the administration of justice undermines the faith of
the people in the judiciary, which is expected to hear their supplications promptly. Delay
reinforces in the mind of litigants the impression that the wheels of justice grind ever so
slowly. As the time-honored principle goes, justice delayed is justice denied.
[12]

In this case, respondent judge never resolved the Motion, filed on June 6, 2000, to
cite Defendant Occidental for contempt. While it is true that the former immediately
conducted an ocular inspection of the area to determine if the Motion had any basis, this
act served only to mitigate his infraction, but not absolve him from it. The Sheriffs
Return of Service of the Writ of Demolition issued in Civil Case No. 1920 would have
clarified whether or not Occidental had already been fully restored in possession. But
while its absence was a valid reason to defer action on the contempt Motion at the
outset, it was certainly not an excuse for the prolonged inaction.

Had respondent judge been so minded, he would have requested a copy of the
Sheriffs Report, so that he could rule on the Motion with dispatch. He has not
satisfactorily explained his failure to do so, considering that the Writ of Demolition
issued in Civil Case No. 1920 had been fully executed as early as February 25, 1998,
and the return thereon made on March 17, 1998. [13]

With respect to the charges against respondent sheriff, we agree with the OCA that
he was remiss in his duty to implement the Writ fully in Civil Case Nos. 481 and 482.
Time and time again, we have impressed upon those tasked to implement court orders
and processes to see to it that the final stage in the litigation process -- the execution of
judgment -- be carried out promptly. They should exert every effort and indeed consider
it their bounden duty to do so, in order to ensure the speedy and efficient administration
of justice. A decision that is left unexecuted or delayed indefinitely because of the
[14]

sheriffs inefficiency or negligence remains an empty victory on the part of the prevailing
party. For this reason, any inordinate delay in the execution of judgment is truly
[15]

deplorable and cannot be countenanced by the Court.

There is no mistaking the mandatory character of the period prescribed under


Section 14 of Rule 39 of the Revised Rules of Court on the Return of a Writ of
Execution, which reads:

SEC. 14. Return of writ of execution. The writ of execution shall be returnable to the
court issuing it immediately after the judgment has been satisfied in part or in full. If
the judgment cannot be satisfied in full within thirty (30) days after his receipt of the
writ, the officer shall report to the court and state the reason therefor. Such writ shall
continue in effect during the period within which the judgment may be enforced by
motion. The officer shall make a report to the court every thirty (30) days on the
proceedings taken thereon until the judgment is satisfied in full, or
its effectivity expires. The returns or periodic reports shall set forth the whole of the
proceedings taken, and shall be filed with the court and copies thereof promptly
furnished the parties.

A similar rule is stated in Administrative Circular No. 12 dated October 1, 1985, and
incorporated in the Manual for Clerks of Court. According to this Circular, all sheriffs
[16]

and deputy sheriffs shall submit to the judge concerned a report on actions taken on all
writs and processes assigned to them within 10 days from receipt.

Per the records of this case, a Writ of Execution was issued on November 22,
1999 in Civil Case Nos. 481 and 482. Respondent Sheriffs Return of Service of that
[17] [18]

Writ was filed only on May 25, 2000, however, or six months thereafter. There is nothing
in the records showing that he submitted before then a periodic report on the actions he
had taken on the Writ every 30 days from the date of receipt as required. On the
contrary, the Report indicates that the Writ was partially executed on December 15-28,
1999 and January 11, 2000; and that the damages adjudged were partly paid in the
amount of P3,500 plus one unit of Karaoke machine. But it was only on May 25, 2000,
that this matter was reported to the trial court.

The excuse proffered by respondent sheriff -- heavy workload -- cannot absolve him
from administrative sanctions. As an officer of the court, he should at all times show a
[19]

high degree of professionalism in the performance of his duties. He has failed to


[20]

observe that degree of dedication required of him as a sheriff. The charge of


connivance is, however, dismissed for lack of basis.

Although the OCA recommended that Respondent Judge Bagagan be absolved of


all charges, we find him guilty of undue delay in resolving a pending motion, an
[21]

infraction that also constitutes a violation of a Court circular. Under Section 11(B) of
[22]

Rule 140 of the Revised Rules of Court, this less serious charge may be sanctioned by
[23]

a fine of more than P10,000, but not exceeding P20,000.

As to Sheriff Matias, we find him guilty of simple neglect of duty, a less grave [24]

offense under the Revised Uniform Rules on Administrative Cases in the Civil
Service. This infraction is punishable by a suspension of one month and one day to six
months. But under the circumstances, we find it inadvisable to suspend respondent
[25]

sheriff, considering that his work would be left unattended in his absence. Instead, we
adopt our previous ruling in Aquino v. Lavadia imposing a fine equivalent to his one-
[26]
month salary, so that he can finally implement the subject Writ and perform his other
duties.

WHEREFORE, Judge Antonio C. Bagagan of the Municipal Trial Court


of Guinobatan, Albay, is found guilty of unreasonable delay and is FINED P11,000 with
a stern warning that a repetition of the same or a similar act in the future shall be dealt
with more severely. On the other hand, Sheriff Danilo O. Matias of the Regional Trial
Court of Ligao, Albay (Branch 14), is ordered to pay a fine equivalent to his one-month
salary, with a similar warning of stiffer sanctions for the same or a similar act.

SO ORDERED.

Puno, (Chairman), Sandoval-Gutierrez, Corona, and Carpio-Morales, JJ., concur.

SECOND DIVISION

[G.R. No. 133883. December 10, 2003]

SPOUSES ARTURO AND NICETA SERRANO, petitioners, vs. COURT


OF APPEALS AND HEIRS OF EMILIO S. GELI, respondents.

DECISION
CALLEJO, SR., J.:

Before us is a petition for review on certiorari under Rule 45 of the Rules


of Court of the Decision of the Court of Appeals (CA) in CA-G.R. SP No.
[1]

45573 setting aside the Order of the Regional Trial Court of Quezon City in
Civil Case No. Q-24790 with motion of herein petitioners, Spouses Arturo and
Niceta Serrano, for the issuance of an alias writ of execution. [2]

The Antecedents

The Spouses Serrano were the owners of a parcel of land as well as the
house constructed thereon located at Road 4, Project 6, Diliman, Quezon City,
covered by Transfer Certificate of Title No. 80384, and a parcel of land located
in Caloocan City, covered by Transfer Certificate of Title No. 15191. The
couple mortgaged the said properties in favor of the Government Service
Insurance System (GSIS) as security for a loan of P50,000. By June 1969, the
couple was able to pay only the amount of P18,000.

On June 23, 1969, the Spouses Serrano, as vendors, and Spouses Emilio
and Evelyn Geli, as vendees, executed a deed of absolute sale with partial
assumption of mortgage over the parcel of land covered by TCT No. 80384
and the house thereon for the price of P70,000. The Spouses Geli paid the
amount of P38,000 in partial payment of the property, the balance of P32,000
to be paid by them to the GSIS for the account of the Spouses Serrano. The
Spouses Geli thereafter took possession of the property. In the meantime,
Evelyn Geli died intestate and was survived by her husband Emilio Geli and
their children.

However, Emilio Geli and his children failed to settle the amount
of P32,000 to the GSIS. The latter forthwith filed a complaint against Emilio
Geli and his children with the Regional Trial Court of Quezon City for the
rescission of the deed of absolute sale with partial assumption of
mortgage. The defendants therein alleged, by way of special defense, that the
plaintiffs Spouses Serrano failed to furnish them with a detailed statement of
the account due from the GSIS, thus accounting for their failure to remit the
balance of the loan to the GSIS. On September 6, 1984, the trial court
rendered judgment ordering the rescission of the said deed, the decretal
portion of which reads:

WHEREFORE, judgment is hereby rendered: a) ordering the rescission of the Deed of


Absolute Sale with Assumption of Mortgage, dated June 23, 1969; b) ordering
defendant Emilio S. Geli and all persons claiming under him, including the other
defendants Oswaldo, Eugenia, Marilyn, Cristopher and Ray, all surnamed Geli, to
vacate the house and lot located at No. 110 A-1, Road 4, Project 6, Quezon City, and
to turn over the peaceful possession of the premises to plaintiffs Arturo Serrano and
Niceta M. Serrano; c) ordering defendant Emilio S. Geli to pay plaintiffs the amount
of P1,000.00 a month representing reasonable compensation for the use and
occupancy of the premises starting June 23, 1969 up to the time the defendant Geli
and all other persons claiming under them including the other defendants, shall have
completely vacated the property, deducting therefrom the sum of P38,000.00 paid by
defendant Geli to plaintiffs as part of the aforesaid compensation; and, d) ordering
defendant Emilio S. Geli to pay plaintiffs the sum of P10,000.00 representing
exemplary damages. Costs against defendant Emilio S. Geli. [3]

Emilio Geli and his children appealed the decision to the CA on October
19, 1984. During the pendency of the appeal, the GSIS foreclosed the real
estate mortgage over the property for non-payment of the P50,000 loan
secured by the said property. At the sale on public auction, the GSIS was the
highest bidder. A certificate of sale over the property was thereby issued by
the sheriff in its favor on August 30, 1986. On October 30,
1987 and November 3, 1987, Emilio Geli paid the redemption price
of P67,701.84 to the GSIS. Official Receipts Nos. 905401 and 901685 for the
[4]

said amount with the notation for the account of Arturo Serrano were
issued. Accordingly, on February 22, 1988, the GSIS executed a certificate of
redemption and turned over to Emilio Geli the owners copy of TCT No. 80384
[5]

in the names of the Spouses Serrano. Emilio Geli did not inform the Spouses
Serrano and the CA that he had paid the redemption price to the GSIS.

On January 8, 1991, the CA dismissed the appeal of Emilio Geli and his
children on the ground that the appellants failed to pay the requisite docket
fees despite notices from the appellate court. No motion for the
reconsideration of the resolution was filed. Thus, the said dismissal of the
appeal became final and executory. The Court of Appeals forthwith issued an
Entry of Judgment on February 27, 1991.

After the remand of the records, the Spouses Serrano filed with the RTC
on January 14, 1994 a motion for the execution of the trial courts September
6, 1984 Decision. On February 15, 1994, the trial court issued an order
granting the motion and forthwith issued a writ of execution. The writ,
however, was not implemented as the Spouses Serrano were then in
the United States. On August 1, 1995, the trial court issued an alias writ of
execution on motion of the plaintiffs. This, too, was not implemented, because
of the defendants change of address.On May 9, 1996, the trial court issued an
order granting the motion of the plaintiffs for a second alias writ of
execution. On September 6, 1996, the defendants filed a motion to quash the
same claiming, for the first time, that defendant Emilio Geli had already
redeemed the subject property in 1988 from the GSIS. According to the
defendants, this constituted a supervening event that would make the
execution of the trial courts decision unjust and inequitable.

On May 19, 1997, the trial court issued an order denying the aforesaid
motion of the defendants. It noted that the payment by defendant Emilio Geli
of the redemption price to the GSIS took place before the CA dismissed the
appeal and before the decision of the RTC became final and executory;
hence, it did not constitute a supervening event warranting a quashal of the
writ of execution. The trial court cited the ruling of this Court in Lim v. Jabalde.
[6]

On September 18, 1997, the trial court issued an order granting the motion
for the issuance of another alias writ of execution filed by the Spouses
Serrano, to wit:

The Motion to Quash Writ of Execution, filed by defendants having been earlier
denied and, it being explicit under the New Rules of Civil Procedure (1997) that no
appeals may be taken from orders of execution, instead of giving due course to the
appeal interposed by defendant, the court resolves to grant the motion for the issuance
of an Alias Writ of Execution.[7]

On September 26, 1997, the trial court issued an Alias Writ of Execution.
Conformably with said writ, the sheriff served a Sheriffs Notice to Vacate on
[8] [9]

the defendants. In the meantime, Emilio Geli died intestate and was survived
by his children.

On October 10, 1997, the heirs of Emilio Geli filed with the Court of
Appeals a petition for certiorari and/or prohibition praying for the nullification of
the May 19, 1997 and September 18, 1997 Orders of the trial court. They
alleged inter alia that when their father Emilio Geli paid the redemption price
to the GSIS on October 30, 1987 and November 3, 1987, their appeal of
the September 6, 1984 Decision of the RTC in Civil Case No. Q-24790 before
the CA was still pending resolution. Consequently, under the terms of the
deed of absolute sale with assumption of mortgage which was still subsisting
at that time, they were ipso facto subrogated to the rights of the Spouses
Serrano as mortgagors of the property; hence, they became the owners of the
property and were entitled to the possession thereof. The petitioners therein
further posited that since they acquired ownership of the property before the
CA dismissed their appeal and before the September 6, 1984 Decision of the
RTC became final and executory, the execution of the decision against them
was unjust and unfair. They then prayed for the following relief:

WHEREFORE, premises considered, it is respectfully prayed that the order of public


respondent Judge, dated 18 September 1997 and the Notice to Vacate issued by public
respondent Sheriff, dated 26 September 1997 be set aside. Likewise, to declare
execution of judgment in Civil Case No. Q-24790 to have been rendered impossible,
as execution hereof would result to injustice. In the meantime to obviate irreversible
damage on the part of petitioners, a writ of PRELIMINARY INJUNCTION be
granted after due hearing, ORDERING public respondent Judge and public
respondent Sheriff to desist or refrain from implementing the September 18, 1997
order.

Other remedies available in law and equity are likewise prayed for. [10]

On January 5, 1998, the appellate court issued an order restraining the


implementation of the alias writ of execution and the notice to vacate issued
by the trial court. On May 12, 1998, the CA rendered the assailed decision in
[11]

favor of the heirs of Emilio Geli, the decretal portion of which reads:

WHEREFORE, the foregoing considered, the petition is hereby GRANTED, and the
writ of certiorari issued. The respondent court is hereby PERPETUALLY ENJOINED
from issuing any order or writ which would disturb the petitioners in their lawful
ownership and possession of the property subject matter of the instant case. [12]

The appellate court ruled that since Emilio Geli paid the redemption price
for the property to the GSIS in 1987 while his appeal was pending in the CA,
the said redemption was a supervening event which rendered the
enforcement of the writ of execution issued by the trial court against them
unjust and inequitable.

The Spouses Serrano filed the instant petition and assigned to the CA the
following errors:

I
THE COURT A QUO COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT
PERMANENTLY ENJOINED THE TRIAL COURT FROM DISTURBING THE
RESPONDENTS IN THEIR LAWFUL OWNERSHIP AND POSSESSION OF THE
SAID PROPERTY, IT BEING CLEAR THAT THEIR REDEMPTION WAS
EFFECTED FOR AND ON BEHALF OF PETITIONER ARTURO V. SERRANO.

II

THE COURT A QUO COMMITTED GRAVE ABUSE OF DISCRETION


AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT HELD
THAT THE REDEMPTION CONSTITUTED A SUPERVENING EVENT WHICH
CHANGE THE RELATIONS OF THE PARTIES, THUS RENDERING
EXECUTION INEQUITABLE UNDER THE PREMISES. [13]

The petitioners contend that the payment of the redemption price made by
Emilio Geli in 1987 during the pendency of the appeal in the CA was
ineffective because, subsequently, when the respondents appeal was
dismissed by the CA, the summary decision of the RTC declaring the deed of
absolute sale with partial assumption of mortgage rescinded had become final
and executory. The deed of absolute sale with partial assumption of mortgage
executed by the petitioners and the Spouses Geli had ceased to exist with its
rescission as decreed by the RTC. According to the petitioners, the payment
of the redemption price was conditioned upon the perfection and outcome of
the appeal. Since the appeal of the respondents was dismissed by their failure
to pay the requisite docket fees, they must suffer the consequences
thereof. The petitioners assert that the redemption of a property is a right
belonging to the mortgagor-debtor, and since the deed of absolute sale with
partial assumption of mortgage had been rescinded by final judgment of the
RTC, Emilio Geli was no longer a mortgagor or the successor-in-interest of the
mortgagors; hence, he could not redeem the property on behalf of the
mortgagors without the latters knowledge and consent.

For their part, the respondents echo the ruling of the CA that although the
issuance by the trial court of a writ of execution is ministerial upon the finality
of its decision, the same is subject to the onset of a supervening event which
may, as in this case, render the same unwarranted, unjust and inequitable.

The respondents contend that the petitioners lost their ownership over the
property when they failed to redeem the property within one year from the sale
thereof at public auction to the GSIS. Although the GSIS executed a
Certificate of Redemption in favor of Emilio Geli on February 22, 1988, the
deed was, in fact, a deed of conveyance because, by then, the one-year
period to redeem the property had already lapsed and the GSIS in the
meantime had become the owner of the property. Thus, the Spouses Geli
acquired ownership thereof when they purchased the same from the GSIS in
1988 for P67,701.84. The GSIS in effect sold the property to Emilio Geli and
did not merely allow him to redeem it. Departing from their submission before
the CA, the respondents now posit that their claim of ownership over the
subject property was after all not anchored on the deed of sale with
assumption of mortgage, as it had been admittedly rescinded by virtue of the
finality of the trial courts September 6, 1984 Decision. Their claim of
ownership rests on the fact that they had acquired the property from the GSIS,
the purchaser at public auction. As owners of the property, they cannot now
be evicted therefrom.

We find the petition to be meritorious.

Generally, the execution upon a final judgment is a matter of right on the


part of the prevailing party. It is the ministerial and mandatory duty of the trial
court to enforce its own judgment once it becomes final and executory. It may
happen, however, that new facts and circumstances may develop or occur
after a judgment had been rendered and while an appeal therefrom is
pending; or new matters had developed after the appeal has been dismissed
and the appealed judgment had become final and executory, which the parties
were not aware of and could not have been aware of prior to or during the trial
or during the appeal, as they were not yet in existence at that time. In the first
situation, any attempt to frustrate or put off the enforcement of an executory
decision must fail. Once a judgment has become final and executory, the only
remedy left for material attention thereof is that provided for in Rule 38 of the
Rules of Court, as amended. There is no other prerequisite mode of thwarting
the execution of the judgment on equitable grounds predicated on facts
occurring before the finality of judgment. In the second situation, the
[14]

execution may be stayed, notwithstanding the affirmance of the appealed


judgment by this Court. It is required, however, that the supervening facts
[15]

and circumstances must either have a direct effect upon the matter already
litigated and settled or create a substantial change in the rights or relations of
the parties therein which would render execution of a final judgment unjust,
impossible or inequitable or when it becomes imperative in the interest of
justice. The interested party may file a motion to quash a writ of execution
[16]

issued by the trial court, or ask the court to modify or alter the judgment to
harmonize the same with justice and further supervening facts. Evidence [17]

may be adduced by the parties on such supervening facts or circumstances. [18]

In this case, the payment by Emilio Geli of the amount of P67,701.84 on


October 30 and November 3, 1987 to the GSIS for the account of the
petitioners was made while the appeal of the private respondents from the
summary judgment of the RTC was pending. The summary judgment of the
RTC had not yet become final and executory. It behooved the said
respondents to prosecute their appeal and file their brief, where they should
have invoked the payment of the redemption price as a ground for the
reversal of the trial courts summary judgment in their favor. The respondents
failed to do so, and even concealed the payment of the loan for the account of
the petitioners. Worse, the respondents did not pay the requisite docket fees
for their appeal, which resulted in its dismissal. The respondents even opted
not to file any motion for the reconsideration of the resolution of the CA
dismissing their appeal. In sum, the respondents allowed the decision of the
trial court to become final and executory. Consequently, the enforcement of
the summary judgment of the trial court can no longer be frustrated by the
respondents payment, through Emilio Geli, of the amount of P67,701.84 to the
GSIS in 1987.

Irrefragably, the Spouses Geli, as vendees-mortgagors under the deed of


absolute sale with partial assumption of mortgage, would have been
subrogated to the rights and obligations of the petitioners under the said deed,
including the right to redeem the property from the GSIS. However, the CA
[19]

dismissed their appeal for failure to pay the requisite docket fees, and such
dismissal became final and executory. Hence, the summary judgment of the
trial court declaring the deed of absolute sale with partial assumption of
mortgage rescinded had also become final and executory.

Generally, the rule is that to rescind a contract is not merely to terminate it,
but to abrogate and undo it from the beginning; that is, not merely to release
the parties from further obligations to each other in respect to the subject of
the contract, but to annul the contract and restore the parties to the relative
positions which they would have occupied if no such contract had ever been
made. Rescission necessarily involves a repudiation of the contract and a
refusal of the moving party to be further bound by it. With the rescission of
[20]
the deed of sale, etc., the rights of Emilio Geli under the said deed to redeem
the property had been extinguished. The petitioners cannot even be
compelled to subrogate the respondents to their rights under the real estate
mortgage over the property which the petitioners executed in favor of the
GSIS since the payment of the P67,701.84 redemption price was made
without the knowledge of the petitioners. The respondents, however, are
[21]

entitled to be reimbursed by the petitioners to the extent that the latter were
benefited.[22]

Neither did the respondents acquire title to the property under the
certificate of redemption executed by the GSIS on February 10, 1998.

First. In the certificate of redemption, the mortgagor-debtor in whose favor


the certificate was executed was the petitioner Arturo Serrano and not Emilio
Geli and/or the respondents:

NOW, THEREFORE, for and in consideration of the foregoing premises and the sum
of SIXTY-SEVEN THOUSAND SEVEN HUNDRED ONE & 84/100 (P67,701.84)
PESOS, Philippine Currency, herein paid by EMILIO S. GELI, of legal age, married,
Filipino, with residence and postal address at 110 A-1, Road 4, Project 6, Quezon
City, do hereby resell, retransfer and reconvey by way of Certificate of Redemption in
favor of ARTURO V. SERRANO, the above-described parcel/s of land, together with
the building/s and improvements existing thereon.

IN WITNESS WHEREOF, the GOVERNMENT SERVICE INSURANCE SYSTEM


has caused this instrument to be executed by its Director, Atty. Roque M. Fernando,
Jr., at the City of Manila, Philippines, this _______ day of ______, 19__.

GOVERNMENT SERVICE INSURANCE SYSTEM

Mortgagee-Purchaser

By: Sgd.

ROQUE M. FERNANDO, JR.

in his capacity as Director [23]

Second. Case law has it that the one-year period within which the
mortgagor-debtor or his successor-in-interest may redeem the property should
be counted from the time the certificate of sale was registered with the
Register of Deeds. Upon the lapse of the one-year period, the right to
[24]

redeem becomes functus officio on the date of its expiry. The rule on [25]

redemption is actually liberally construed in favor of the original owner of the


property. The purpose of the law is to aid rather than to defeat him in the
exercise of his right of redemption. Before the lapse of the one-year period,
[26]

the mortgagor-debtor remains the owner of the property. The right acquired by
the purchaser at public auction is merely inchoate until the period of
redemption has expired without the right being exercised by the redemptioner.
Such right becomes absolute only after the expiration of the redemption
[27]

period without the right of redemption having been exercised. The purchaser
[28]

is entitled as a matter of right to consolidation of title and to the possession of


the property. Where redemption is seasonably exercised by the mortgagor-
[29]

debtor, what is actually effected is not the recovery of ownership of his land,
which ownership he never lost, but the elimination from his title thereto of the
lien created by the registration of a mortgage thereon. [30]

Upon the expiry of the redemption period without the mortgagor-debtor


being able to redeem the property, the purchaser can no longer be compelled
to allow the former to redeem the property or to resell the property; and if he
agrees to sell the property, it may be for a price higher than that for which he
purchased the property at public auction. [31]

In this case, there is no showing in the records that the sheriffs certificate
of sale in favor of the GSIS had been registered in the Office of the Register of
Deeds of Quezon City and if so, when it was in fact registered in the said
office. It cannot thus be argued that when Emilio Geli remitted the amount
of P67,701.84 to the GSIS in full payment of the account of the petitioners, the
one-year period to redeem the property had by then lapsed. Hence, the
petitioners remained the owners of the property. The GSIS never acquired title
over the property and could not have conveyed and transferred ownership
over the same when it executed the certificate of redemption to and in the
name of the petitioner Arturo Serrano. As the Latin maxim goes: NEMO DAT
QUOD NON HABET.

We are not convinced by the ratiocination of the respondents that the


enforcement of the summary decision of the trial court and the alias writ of
execution against them is unjust and unreasonable.
The Spouses Geli and the respondents, as heirs and successors-in-
interest of the said spouses, were obliged under the deed of absolute sale
with partial assumption of mortgage to pay to the GSIS the balance of the
petitioners account. The Spouses Geli reneged on their undertaking. The
petitioners were impelled to secure the services of counsel and sue the
Spouses Geli with the RTC for the rescission of the said deed with
damages. The respondent spouses nevertheless remained adamant and
refused to pay the petitioners account with the GSIS which impelled the latter
to foreclose the real estate mortgage and sell the property at public
auction. Emilio Geli and the respondents did not inform the CA and the
petitioners that Emilio Geli had paid the amount of P67,701.84 for the account
of the petitioners. The respondents even allowed their appeal to be dismissed
by the CA, and the dismissal to become final and executory. The petitioners
were impelled to spend money for their counsel and for sheriffs fees for the
implementation of the writ of execution and the alias writ of execution issued
by the trial court. In the meantime, the respondents remained in possession of
the property from 1969, when the said deed of absolute sale with partial
assumption of mortgage was executed, up to the present, or for a period of 34
years without paying a single centavo. For the Court to allow the respondents
to benefit from their own wrong would run counter to the maxim: Ex Dolo Malo
Non Oritur Actio (No man can be allowed to found a claim upon his own
wrongdoing). Equity is applied only in the absence of and never against
[32]

statutory law or judicial rules of procedure. We reiterate our ruling that:


[33]

Justice is done according to law. As a rule, equity follows the law. There may be a
moral obligation, often regarded as an equitable consideration (meaning compassion),
but if there is no enforceable legal duty, the action must fail although the
disadvantaged party deserves commiseration or sympathy.

The choice between what is legally just and what is morally just, when these two
options do not coincide, is explained by Justice Moreland in Vales v. Villa, 35 Phil.
769, 788 where he said:

Courts operate not because one person has been defeated or overcome by another, but
because he has been defeated or overcome illegally. Men may do foolish things, make
ridiculous contracts, use miserable judgment, and lose money by themindeed, all they
have in the world; but not for that alone can the law intervene and restore. There must
be in addition, a violation of law, the commission of what the law knows as an
actionable wrong before the courts are authorized to lay hold of the situation and
remedy it. (Rural Bank of Paraaque, Inc. v. Remolado, 62051, March 18, 1985) (135
SCRA 409, 412). [34]

In sum then, the respondents, as heirs of Emilio Geli, are obliged to vacate
the subject property. However, since the petitioners were benefited to the
extent of P67,701.84 which was the total amount paid by Emilio Geli to the
GSIS as redemption price for the foreclosed property, the petitioners are
obliged to refund the said amount to the respondents.

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The


assailed decision of the Court of Appeals dated May 12, 1998 in CA-G.R. SP
No. 45573 is SET ASIDE AND REVERSED. The petitioners Spouses Serrano
are obliged to refund to the respondents, as heirs of Emilio S. Geli, the
amount of P67,701.84 to be deducted from the amount due to the petitioners
under the September 6, 1984 Decision of the Regional Trial Court, Quezon
City, in Civil Case No. Q-24790.

SO ORDERED.

Puno, (Chairman), Quisumbing, Austria-Martinez, and Tinga, JJ., concur.

THIRD DIVISION

[G.R. No. 151325. June 27, 2005]


D ARMOURED SECURITY AND INVESTIGATION AGENCY,
INC., petitioner, vs. ARNULFO ORPIA, LODUVICO ABUCEJO,
ROWEL AGURO, EFREN ALMOETE, ROMEO AMISTA, WARLITO
BALAGOSA, ROMEO BALINGBING, RAMON BARROA,
MONTECLARO BATAWIL, ARNEL BON, RICARDO CAPENTES,
DANILO DADA, JOEL DELA CRUZ, HERNANO DELOS REYES,
FLORENTINO DELOS TRINO, ROGELIO DUERME, NONITO
ESTRELLADO, JOSEPH FALCESO, ISIDRO FLORES, VICTOR
GUNGON, SONNY JULBA, PATRICIO LACANA, JR., FELIX
LASCONA, JUANITO LUNA, RAUL LUZADAS, ROMMEL
MAGBANUA, ROGELIO MARIBUNG, NICOLAS MENDOZA,
EZVENER OGANA, RICKY ORANO, REYNALDO OZARAGA,
SAMUEL PADILLA, EDWIN PARRENO, IRENEO PARTOLAN,
JUAN PIGTUAN, GUILLERMO PUSING, RODEL SIBAL,
SILVESTRE SOLEDAD, JOVENAR TEVER, VIRGILIO TIMAJO,
ERMILIO TOMARONG, JR., VIRGILIO VERDEFLOR and JOEREX
VICTORINO, respondents.

DECISION
SANDOVAL-GUTIERREZ, J.:

For resolution is a petition for review on certiorari under Rule 45 of the


1997 Rules of Civil Procedure, as amended, assailing the Decision [1] dated
December 18, 2001 rendered by the Court of Appeals in CA-G.R. SP No.
61799, entitled DArmoured Security and Investigation Agency, Inc. vs.
National Labor Relations Commission, Arbiter Ariel C. Santos, NLRC Sheriff
Ricardo Perona, Arnulfo Orpia, Ludovico Abucejo, Rowel Aguro, Efren
Almoete, Romeo Amista, Warlito Balgosa, Romeo Balingbing, Ramon Barroa,
Monteclaro Batawil, Arnel Bon, Ricardo Capentes, Danilo Dada, Joel dela
Cruz, Hernando delos Reyes, Florentino delos Trino, Rogelio Duerme, Nonito
Estrellado, Joseph Falceso, Isidro Flores, Victor Gungon, Sonny Julba,
Patricio Lacana, Jr., Felix Lascona, Juanito Luna, Raul Lozadas, Rommel
Magbanua, Rogelio Maribung, Nicolas Mendoza, Ezvener Ogana, Ricky
Orano, Reynaldo Ozaraga, Samuel Padilla, Edwin Parreno, Ireneo Partolan,
Juan Pigtuan, Guillermo Pusing, Rodel Sibal, Silvestre Soledad, Jovener
Tever, Virgilio Timajo, Emilio Tomarong, Jr., Virgilio Verdeflor and Joerex
Victorino.
On February 9, 1995, the above-named respondents, who were employed
as security guards by DArmoured Security and Investigation Agency,
Inc., petitioner, and assigned to Fortune Tobacco, Inc. (Fortune Tobacco), filed
with the Labor Arbiter a complaint for illegal dismissal and various monetary
claims against petitioner and Fortune Tobacco, docketed as NLRC-NCR Case
No. 00-02-01148-95.

On June 11, 1998, the Labor Arbiter rendered a Decision, the dispositive
portion of which reads:

WHEREFORE, premises considered, all the respondents except Antonio Cabangon


Chua are jointly and severally liable to pay complainants the total sum of ONE
MILLION SEVENTY SEVEN THOUSAND ONE HUNDRED TWENTY FOUR
AND TWENTY NINE CENTAVOS (P1,077,124.29) for underpayment, overtime pay,
legal holiday pay, service incentive leave pay, 13 th month pay, illegal deduction and
refund of firearms bond, as indicated in Annex A.

Finally, ten (10%) percent of all sums owing to complainants is hereby awarded as
attorneys fees.

SO ORDERED.

From the said Decision, Fortune Tobacco interposed an appeal to the


National Labor Relations Commission (NLRC). Petitioner did not appeal. On
March 26, 1999, the NLRC rendered its Decision affirming with modification
the assailed Arbiters Decision in the sense that the complaint against Fortune
Tobacco was dismissed. This Decision became final and executory. Thus, the
award specified in the Decision of the Arbiter became the sole liability of
petitioner.

The records were then remanded to the Arbiter for execution.

Upon respondents motion, the Arbiter issued a writ of execution.


Eventually, the sheriff served a writ of garnishment upon the Chief Accountant
of Foremost Farms, Inc., a corporation with whom petitioner has an existing
services agreement. Thus, petitioners receivables with Foremost were
garnished.

Petitioner filed with the NLRC a Motion to Quash/Recall Writ of Execution


and Garnishment which was opposed by respondents.
On March 10, 2000, the Arbiter issued an Order denying the motion and
directing the sheriff to release the garnished sum of money to
respondents pro rata.

Petitioners motion for reconsideration was denied, hence, it interposed an


appeal to the NLRC.

In a Resolution dated July 27, 2000, the NLRC dismissed the appeal for
petitioners failure to post a bond within the reglementary period. Its motion for
reconsideration was denied in a Resolution dated September 25, 2000.

Forthwith, petitioner filed with the Court of Appeals a petition


for certiorari and prohibition with prayer for issuance of a writ of preliminary
injunction.

In a Decision dated December 18, 2001, the Court of Appeals dismissed


the petition.

Hence, this petition for review on certiorari.

In this petition, the issue posed is whether the Court of Appeals erred in
holding that petitioners monthly receivables from the Foremost Farms, Inc.
(garnishee) are not exempt from execution.

The petition lacks merit. We have ruled that an order of execution of a


final and executory judgment, as in this case, is not appealable,
otherwise, there would be no end to litigation. [2] On this ground alone, the
instant petition is dismissible.

Assuming that an appeal is proper, still we have to deny the instant


petition. Section 1, Rule IV of the NLRC Manual on Execution of Judgment
provides:

Rule IV

EXECUTION

SECTION 1. Properties exempt from execution. Only the properties of the losing
party shall be the subject of execution, except:
(a) The losing partys family home constituted in accordance with the Civil Code or
Family Code or as may be provided for by law or in the absence thereof, the
homestead in which he resides, and land necessarily used in connection therewith,
subject to the limits fixed by law;

(b) His necessary clothing, and that of his family;

(c) Household furniture and utensils necessary for housekeeping, and used for that
purpose by the losing party such as he may select, of a value not exceeding the
amount fixed by law;

(d) Provisions for individual or family use sufficient for three (3) months;

(e) The professional libraries of attorneys, judges, physicians, pharmacists, dentists,


engineers, surveyors, clergymen, teachers, and other professionals, not exceeding the
amount fixed by law;

(f) So much of the earnings of the losing party for his personal services within the
month preceding the levy as are necessary for the support of his family;

(g) All monies, benefits, privileges, or annuities accruing or in any manner growing
out of any life insurance;

(h) Tools and instruments necessarily used by him in his trade or employment of a
value not exceeding three thousand (P3,000.00) pesos;

(i) Other properties especially exempted by law.

The above Rule clearly enumerates what properties are exempt from
execution. It is apparent that the exemption pertains only to natural persons
and not to juridical entities. On this point, the Court of Appeals correctly ruled
that petitioner, being a corporate entity, does not fall within the exemption,
thus:

We cannot accede to petitioners position that the garnished amount is exempt from
execution.

Section 13 of Rule 39 of the Rules of Court is plain and clear on what properties are
exempt from execution. Section 13 (i) of the Rules pertinently reads:
SECTION 13. Property exempt from execution. Except as otherwise expressly
provided by law, the following property, and no other, shall be exempt from
execution:

xxxxxxxxx

(i) So much of the salaries, wages or earnings of the judgment obligor for
his personal services within the four months preceding the levy as are
necessary for the support of his family.

The exemption under this procedural rule should be read in conjunction with the Civil
Code, the substantive law which proscribes the execution of employees wages, thus:

ART. 1708. The laborers wage shall not be subject to execution or attachment, except
for debts incurred for food, shelter, clothing and medical attendance.

Obviously, the exemption under Rule 39 of the Rules of Court and Article 1708 of the
New Civil Code is meant to favor only laboring men or women whose works are
manual. Persons belonging to this class usually look to the reward of a days labor for
immediate or present support, and such persons are more in need of the exemption
than any other [Gaa vs. Court of Appeals, 140 SCRA 304 (1985)].

In this context, exemptions under this rule are confined only to natural
persons and not to juridical entities such as petitioner. Thus, the rule speaks of
salaries, wages and earning from the personal services rendered by the judgment
obligor. The rule further requires that such earnings be intended for the support of the
judgment debtors family.

Necessarily, petitioner which is a corporate entity, does not fall under the exemption.
If at all, the exemption refers to petitioners individual employees and not to petitioner
as a corporation.

x x x. Parenthetically, in a parallel case where a security agency claimed that the guns
it gives to its guards are tools and implements exempt from execution, the Supreme
Court had the occasion to rule that the exemption pertains only to natural and not to
juridical persons, thus:

However, it would appear that the exemption contemplated by the provision involved
is personal, available only to a natural person, such as a dentists dental chair and
electric fan (Belen v. de Leon, G.R. No. L-15612, 30 Nov. 1962). As pointed out by
the Solicitor General, if properties used in business are exempt from execution, there
can hardly be an instance when a judgment claim can be enforced against the business
entity [Pentagon Security and Investigation Agency vs. Jimenez, 192 SCRA 492
(1990)].

It stands to reason that only natural persons whose salaries, wages and earnings are
indispensable for his own and that of his familys support are exempted under Section
13 (i) of Rule 39 of the Rules of Court. Undeniably, a corporate entity such as
petitioner security agency is not covered by the exemption.

WHEREFORE, the petition is hereby DISMISSED.

SO ORDERED.

WHEREFORE, the petition is DENIED. The assailed Decision dated


December 18, 2001 of the Court of Appeals in CA-G.R. SP No. 61799 is
AFFIRMED IN TOTO. Costs against petitioner.

SO ORDERED.

SECOND DIVISION

[G.R. No. 157616. July 22, 2005]


ISIDRO PEREZ and NARCISO A. RAGUA, petitioners, vs. HON. COURT
OF APPEALS, HON. VIVENCIO S. BACLIG and SPOUSES
GAUDENCIO DIGOS, JR. and RHODORA DIGOS, respondents.

DECISION
CALLEJO, SR., J.:

The spouses Gaudencio Digos, Jr. and Rhodora Digos secured a loan
of P5,800,000.00 from the International Exchange Bank in December 1996, to
finance their project for the construction of townhouses on their property
covered by Transfer Certificate of Title (TCT) No. 168790 located in Tandang
Sora, Quezon City. To secure the payment of the loan, the spouses Digos
executed a Real Estate Mortgage over the said property. However, the
completion of their project was delayed, partly because some homeowners in
the Pillarville Subdivision (which abutted the subject property) refused to allow
them to build an access road through the subdivision to the property. Thus,
the equipment to be used for the project could not pass through the Pillarville
Subdivision.

Because of the spouses Digos failure to pay the amortizations on their


loan, the bank caused the extrajudicial foreclosure of their real estate
mortgage. Consequently, the property was sold at public auction, with the
bank as the highest bidder at P4,500,000.00, which appeared to be the
account of the spouses Digos at the time. The Certificate of Sale executed by
the sheriff was, thereafter, registered at the Office of the Register of Deeds on
September 7, 1998.[1]

In the meantime, the spouses Digos referred the matter of the right of way
to the barangay captain for settlement. Due to the vehement objections of
some Pillarville Subdivision homeowners, the barangay captain failed to
resolve the matter.[2]

On July 2, 1999, the spouses Digos wrote the bank, requesting for a
period of six (6) months from September 7, 1999 within which to redeem the
property.[3] However, the bank denied the request. On August 3, 1999, the
spouses again wrote to the bank, pleading for an extension of at least three
(3) months to redeem the property.[4] In a Letter[5] to the spouses dated August
30, 1999, the bank granted the spouses Digos a period of one month from
September 8, 1999 (or until October 8, 1999) within which to redeem the
property. However, the bank consolidated its title over the property, and on
September 19, 1999, the Register of Deeds issued TCT No. 206979 in the
name of the bank.

Instead of repurchasing the property on or before October 8, 1999, the


spouses Digos filed a Complaint[6] against the bank on October 7, 1999 with
the Regional Trial Court (RTC) of Quezon City, for the nullification of the
extrajudicial foreclosure of the real estate mortgage and sale at public auction
and/or redemption of the property, with a prayer for a temporary restraining
order and a writ of preliminary injunction to enjoin the bank from consolidating
its title over the property. The spouses Digos also sought judgment for
damages.

In their complaint, the spouses Digos alleged, inter alia, that they were
denied their right to due process because the foreclosure of the real estate
mortgage was extrajudicial; the sale of their property at public auction was
without prior notice to them; the property was sold for only P4,500,000.00, the
balance of their account with the bank, but about 400% lower than the
prevailing price of the property; the bank rejected their plea for a five-month
extension to redeem, and their offer of P1,000,000.00 in partial payment of
their loan account to reduce the same to P3,500,000.00, but the bank granted
them an extension of only one month to redeem the property, designed to
divest them of the same and enrich some characters at their expense;
because of the foregoing acts of the bank, they suffered sleepless nights,
nervous tension and the rise in their blood pressure for which they were
entitled to moral damages in the amount of P500,000.00, aside from the
exemplary damages they were entitled to in the amount of P100,000.00.

The spouses Digos prayed for a temporary restraining order to enjoin the
bank from consolidating its title over the property, and that judgment be
rendered in their favor, thus:

2. Ordering the defendant Bank to allow plaintiffs to redeem their property;

3. Making the writ of injunction permanent;

4. Ordering the defendant Bank to pay moral damages of P500,000.00;

5. Ordering defendant Bank to pay exemplary damages of P200,000.00;


6. Ordering defendant Bank to pay attorneys fee of P30,000.00 plus P2,000.00 for
every appearance in Court;

Plaintiffs further pray for such other reliefs and remedies available within the
premises.[7]

The case (first complaint, for brevity) was docketed as Civil Case No. Q-
99-38941. The spouses Digos caused the annotation of a notice of lis
pendens at the dorsal portion of TCT No. 206979. The trial court, however, did
not issue a temporary restraining order or writ of preliminary injunction.

Meanwhile, the bank filed a motion to dismiss the complaint and for the
cancellation of the notice of lis pendens on the following grounds:

1. The action for injunction has already been rendered moot and academic, title to the
foreclosed property having been consolidated in iBanks name;

2. Assuming arguendo that title to the foreclosed property has not yet been
consolidated, still plaintiffs have no cause of action for injunction against iBank.[8]

The spouses Digos opposed the motion. The bank filed a reply, appending
thereto a copy of TCT No. 206979 in its name.

In an Order dated December 9, 1999, the trial court granted the motion
and dismissed the complaint. It found that the spouses Digos admitted in their
complaint that the period for the redemption of the property was about to
expire, and that they were given up to October 8, 1999 within which to do so.
The court held that it had no authority to extend the period for redemption, and
since it had already expired, the spouses had no more right to redeem the
property; as such, the defendant had the right to consolidate its title over the
property, and had, in fact, been issued TCT No. 206979. The court also
declared that the spouses Digos had no right to demand that they be allowed
to redeem the property.

Finally, since the act sought to be enjoined the consolidation of the banks
title was already fait accompli, the spouses Digos had no cause of action for
injunction.[9] The trial court ruled that a writ of injunction cannot issue to enjoin
a consummated act.[10] It, thus, ordered the cancellation of the notice of lis
pendens annotated at the dorsal portion of TCT No. 206979.
The spouses Digos failed to appeal the order; instead, they filed a petition
for certiorari with the Court of Appeals (CA), assailing the Order of the RTC.
The CA dismissed the petition because it was filed out of time. The petitioners
then filed a motion for reconsideration thereof, which they later withdrew via a
motion. The CA then resolved to grant the motion; hence, the CA resolution
dismissing the petition became final and executory on May 7, 2001. Entry of
judgment was made of record.[11]

Meanwhile, the bank sold the property to Isidro Perez and Narciso Ragua
to whom the Register of Deeds issued TCT No. 211888. The vendees caused
the subdivision of the property into eighteen (18) lots. The Register of Deeds
issued titles for each subdivision lot in favor of Perez and Ragua.[12]

On June 4, 2001, the spouses Digos filed a Complaint[13] with the RTC of
Quezon City, this time, against the bank, Perez and Ragua, for the
cancellation and annulment of the extrajudicial foreclosure of the real estate
mortgage executed by them in favor of the bank, the sale at public auction as
well as the certificate of sale executed by the sheriff, and the Torrens title
issued to them. The spouses Digos prayed for a writ of preliminary injunction
and a temporary restraining order. The petitory portion of the complaint reads:

WHEREFORE, premises considered, it is most respectfully prayed of this Honorable


Court that immediately upon the filing of the instant complaint, a temporary
restraining order be issued, and after hearing, a writ of preliminary injunction issue,
enjoining defendants PEREZ and RAGUA from further disposing of the subject
property.

Likewise, it is most respectfully prayed of this Honorable Court that, after due
hearing, judgment be rendered ordering the CANCELLATION and ANNULMENT of
the extrajudicial foreclosure of sale, the Sheriffs Certificate of Sale and the
consolidated title under the name of defendant bank, as well as the transfer
certificate/s of title issued or under the name of defendants iBANK, PEREZ and
RAGUA;

Further, it is most respectfully prayed also that judgment be rendered ordering the
defendants:

1. to pay plaintiffs the amount of FIVE HUNDRED THOUSAND [PESOS]


(P500,000.00), as and by way of actual expenses:
2. to pay plaintiffs the amount of ONE MILLION AND FIVE HUNDRED
THOUSAND PESOS (P1,500,000.00), as and by way of moral damages;

3. to pay plaintiffs the amount of ONE HUNDRED THOUSAND PESOS


(P100,000.00), as and by way of exemplary damages;

4. to pay plaintiffs the amount of FIVE HUNDRED THOUSAND PESOS


(P500,000.00), as and by way of attorneys fees; and,

5. to pay the expenses of litigation and costs of suit.

Plaintiffs further pray for other reliefs, just and equitable, under the circumstances. [14]

The spouses Digos reiterated the allegations in their complaint in Civil


Case No. Q-99-38941 that they were not notified of the sale at public auction,
and that the banks P4,500,000.00 bid for the property was unconscionably
low compared to the prevailing market price of P25,000,000.00. They also
admitted their failure to pay their amortization on their loans. However, they
alleged this time that the extrajudicial foreclosure of the real estate mortgage
and the sale at public auction were illegal because the bank charged much
more than the amount due on their loan account, to wit: interest of 26% per
annum on the loan account covering January 2, 1998, whereas under the
promissory note executed in favor of the bank, the new interest rate should
commence only on March 4, 1993; penalty charges of 26% of the account,
and 5% penalty charges on top of the 26% interest per annum, as shown by
the banks statement of account. The spouses Digos also averred that
although they pleaded for a restructuring of their loan account and a
moratorium on the payment of their account, they were unaware of the
erroneous computation of the balance of their loan account. They maintained
that the banks consolidation of its title over the property on September 19,
1999 was premature because they were given until October 8, 1999 to
redeem the property.

The spouses Digos also alleged that as a consequence of the banks acts,
they incurred actual damages of P500,000.00, sustained moral damages
of P1,500,000.00, and were entitled to exemplary damages for P100,000.00.
[15]

The case was docketed as Civil Case No. Q-01-44227. The defendant
bank filed a motion to dismiss the complaint on the following grounds:
A. THE PLAINTIFFS HAVE NO CAUSE OF ACTION AGAINST DEFENDANTS, THEY
BEING ESTOPPED FROM QUESTIONING THE REGULARITY OF THE
EXTRAJUDICIAL FORECLOSURE SALE.

B. PLAINTIFFS HAVE VIOLATED THE RULE AGAINST SPLITTING A SINGLE


CAUSE OF ACTION UNDER SECTION 4, RULE 2 OF THE RULES OF COURT
IN INSTITUTING THE INSTANT CASE.

C. PLAINTIFFS ARE GUILTY OF FORUM SHOPPING.

D. PLAINTIFFS ARE GUILTY OF FALSE CERTIFICATION AGAINST FORUM


SHOPPING, IN VIOLATION OF SECTION 5, RULE 7 OF THE RULES OF
COURT.[16]

The bank alleged that the spouses Digos admitted in their complaint that,
after the extrajudicial foreclosure of the real estate mortgage and the sale of
the property at public auction, they pleaded to redeem the property but failed
to do so and were granted a one-month extension. The bank averred that,
based on the said allegations, the spouses were estopped from assailing the
extrajudicial foreclosure of the real estate mortgage, the sale at public auction
and the Torrens title issued to it; hence, they had no cause of action. It further
alleged that the spouses Digos already assailed the extrajudicial foreclosure
of the real estate mortgage and the sale of the property at public auction on
account of lack of due process and arbitrary abuse in their first complaint; they
again sought to do so in this case, this time grounded on the invalid
foreclosure of the real estate mortgage, and the sale at public auction of the
property for an amount in excess of the balance of the loan account. The bank
argued that, in so doing, the spouses Digos were guilty of splitting a single
cause of action which is proscribed by Rule 2, Section 4 of the Rules of Court;
they were, likewise, barred by res judicata from filing the second complaint for
the same causes of action, even if additional defendants were impleaded.
Consequently, the spouses Digos were also guilty of forum shopping.[17]

Perez and Ragua filed a motion to dismiss on similar grounds of res


judicata, splitting of a single cause of action and forum shopping.[18]

On June 29, 2001, the trial court issued an Order [19] denying the motion,
ruling that there was no identity of issue in the two actions because, in the
second complaint (docketed as Civil Case No. Q-01-44227), the spouses
Digos assailed the legality of the extrajudicial foreclosure, on the sole ground
that the bank had unlawfully increased their obligation, contrary to the terms
and conditions of the loan contract. The court held that the causes of action in
the two complaints were not identical: in the first case, it was for the
redemption of the mortgaged property, distinct and separate from their cause
of action in the second case which is rooted on the erroneous computation of
the balance of their loan account with the bank. The court also declared that in
the first complaint, the spouses Digos assailed the validity or regularity of the
extrajudicial foreclosure of the real estate mortgage and the sale at public
auction. Consequently, the court concluded, the complaint was not barred
by res judicata; nor are they guilty of forum shopping.

The trial court denied the defendants motion for reconsideration in its
Order[20] dated December 6, 2001; hence, they filed a petition[21] for certiorari,
prohibition and mandamus with the CA, alleging therein that the respondent
judge committed a grave abuse of his discretion amounting to excess or lack
of jurisdiction in denying their motion to dismiss the complaint.

On November 25, 2002, the CA rendered judgment dismissing the petition


and affirming the assailed orders. The appellate court declared that there was
no identity of causes of action in the two cases because the first action was
one for injunction and redemption of the property, whereas the second action
was for the nullification of the extrajudicial foreclosure of the real estate
mortgage and the sale at public auction due to the erroneous computation of
the balance on the respondents account with the bank; hence, the spouses
Digos were not estopped from filing their second action. [22] The petitioners filed
a motion for a reconsideration of the said decision, which the appellate court
denied.[23]

Petitioners Isidro Perez and Narciso Ragua forthwith filed the instant
petition for review on certiorari, raising the following issues:

WHETHER OR NOT THE JUDGMENT IN CIVIL CASE NO. Q-99-[38941]


(REDEMPTION OF MORTGAGE) IS RES JUDICATA TO CIVIL CASE NO. Q-01-
44227 (CANCELLATION AND ANNULMENT OF FORECLOSURE SALE)?

WHETHER OR NOT THE PRIVATE RESPONDENTS ARE ALREADY


ESTOPPED FROM ATTACKING THE VALIDITY OF THE FORECLOSURE
SALE?[24]

It is the contention of the petitioners that the private respondents (the


plaintiffs in both actions in the RTC) are guilty of splitting their cause of action.
The petitioners point out that the private respondents failed to pray for the
nullification of the extrajudicial foreclosure and sale at public auction in their
first action, and did so only in their second complaint. For such failure, the
second action was barred by res judicata, conformably with Section 4, Rule 2
of the Rules of Court. The petitioners point out that the issue of the
computation of the respondents balance on their loan account had already
been passed upon and resolved by the court in the first case, and, as such,
can no longer be assailed in the second case. The petitioners likewise
maintain that the validity of the foreclosure of the real estate mortgage and
sale at public auction was raised and resolved in the first case. The petitioners
insist that the private respondents were barred from assailing the extrajudicial
foreclosure of the real estate mortgage and the sale at public auction of the
property in favor of the bank. They further point out that the private
respondents repeatedly requested the bank for extensions to redeem the
property; such requests were eventually granted but the private respondents
still failed to redeem the property.

For their part, the private respondents aver that their action in the first
case was for the grant of an extension to redeem the property and avert the
banks act of consolidating its title over the property, while their action in the
second case was for the nullification of the extrajudicial foreclosure of the real
estate mortgage and the sale of the property at public auction on account of
the arbitrary, unlawful and baseless imposition of unconscionable re-priced
interest rates on their loan account. They aver that there can be no
conclusiveness of judgment in the first action because the issues in the two
cases are not identical. They insist that the issues in the first case are not
being relitigated in the second case; hence, their second action is not barred
by res judicata, nor did they split their cause of action.

The Ruling of the Court

Splitting a single cause of action consists in dividing a single or indivisible


cause of action into several parts or claims and instituting two or more actions
therein.[25] A single cause of action or entire claim or demand cannot be split
up or divided so as to be made the subject of two or more different actions.[26]

A single act or omission may be violative of various rights at the same


time, such as when the act constitutes a violation of separate and distinct
legal obligations.[27] The violation of each of these rights is a cause of action in
itself. However, if only one right may be violated by several acts or omissions,
there would only be one cause of action. Otherwise stated, if two separate
and distinct primary rights are violated by one and the same wrong; or if the
single primary right should be violated by two distinct and separate legal
wrongs; or when the two primary rights are each broken by a separate and
distinct wrongs; in either case, two causes of action would result. [28] Causes of
action which are distinct and independent, although arising out of the same
contract, transaction or state of fact may be sued separately, recovery on one
being no bar to subsequent actions on the others.

The mere fact that the same relief is sought in the subsequent action will
not render the judgment in the prior action as res judicata.[29] Causes of action
are not distinguishable for purposes of res judicata by difference in the claims
for relief.[30]

Comparing the material averments of the two complaints, it would appear


that separate primary rights of the respondents were violated by the banks
institution of a petition for extrajudicial foreclosure of the real estate mortgage
and the sale at public auction; hence, the respondents had separate and
independent causes of action against the bank, to wit: (a) the first complaint
relates to the violation by the bank of the right to a judicial, not extrajudicial,
foreclosure of the real estate mortgage and for an extension of the period for
the respondents to redeem the property with damages; (b) the second
complaint relates to the breach by the bank of its loan contract with the
respondents by causing the extrajudicial foreclosure of the real estate
mortgage for P4,500,000.00 which was in excess of their unpaid account with
the bank.

However, we are convinced that the institution by the respondents of their


second complaint anchored on their claim that the bank breached its loan
contracts with them by erroneously computing the actual and correct balance
of their account when the petition for extrajudicial foreclosure of the real estate
mortgage was filed by it designed to avert the dismissal of their complaint due
to splitting causes of action and res judicata, following the dismissal of their
first complaint and the dismissal of their appeal through their negligence. The
Court is constrained to conclude that this was a last-ditch attempt to
resuscitate their lost cause, a brazen violation of the principle of res judicata.

Section 49(b)(c), Rule 39 of the Rules of Court provides in part:


SEC. 49. Effect of judgments. The effect of a judgment or final order rendered by a
court or judge of the Philippines, having jurisdiction to pronounce the judgment or
order, may be as follows:

(b) In other cases the judgment or order is, with respect to the matter directly adjudged
or as to any other matter that could have been raised in relation thereto, conclusive
between the parties and their successors in interest by title subsequent to the
commencement of the action or special proceeding, litigating for the same thing and
under the same title and in the same capacity.

(c) In any other litigation between the same parties or their successors in interest, that
only is deemed to have been adjudged in a former judgment which appears upon its
face to have been so adjudged, or which was actually and necessarily included therein
or necessary thereto.

Section 49(b) enunciates the first concept of res judicata, known as bar by
prior judgment or estoppel by judgment, which refers to a theory or matter that
has been definitely and finally settled on its merits by a court of competent
jurisdiction without fraud or collusion.

There are four (4) essential requisites which must concur for the
application of this doctrine:

(a) finality of the former judgment;

(b) the court which rendered it had jurisdiction over the subject matter and the
parties;

(c) it must be a judgment on the merits; and

(d) there must be, between the first and second actions, identity of parties, subject
matter and causes of action.[31]

A judgment or order is on the merits of the case when it determines the


rights and liabilities of the parties based on the ultimate facts as disclosed by
the pleadings or issues presented for trial. It is not necessary that a trial,
actual hearing or argument on the facts of the case ensued. For as long as
the parties had the full legal opportunity to be heard on their respective claims
and contentions, the judgment or order is on the merits. [32] An order of the trial
court on the ground that the complaint does not state a cause of action is a
determination of the case on its merits. [33] Such order whether right or wrong
bars another action based upon the same cause of action. [34] The operation of
the order as res judicata is not affected by a mere right of appeal where the
appeal has not been taken or by an appeal which never has been perfected.[35]

Indeed, absolute identity of parties is not a condition sine qua non for the
application of res judicata. It is sufficient that there is a shared identity of
interest.[36] The rule is that, even if new parties are found in the second
action, res judicata still applies if the party against whom the judgment is
offered in evidence was a party in the first action; otherwise, a case can
always be renewed by the mere expedience of joining new parties in the new
suit.[37]

The ultimate test to ascertain identity of causes of action is whether or not


the same evidence fully supports and establishes both the first and second
cases. The application of the doctrine of res judicata cannot be excused by
merely varying the form of the action or engaging a different method of
presenting the issue.[38]

Section 49(c) of Rule 39 enumerates the concept of conclusiveness of


judgment. This is the second branch, otherwise known as collateral estoppel
or estoppel by verdict. This applies where, between the first case wherein
judgment is rendered and the second case wherein such judgment is
involved, there is no identity of causes of action. As explained by this Court:

It has been held that in order that a judgment in one action can be conclusive as to a
particular matter in another action between the same parties or their privies, it is
essential that the issues be identical. If a particular point or question is in issue in the
second action, and the judgment will depend on the determination of that particular
point or question, a former judgment between the same parties will be final and
conclusive in the second if that same point or question was in issue and adjudicated in
the first suit; but the adjudication of an issue in the first case is not conclusive of an
entirely different and distinct issue arising in the second. In order that this rule may be
applied, it must clearly and positively appear, either from the record itself or by the
aid of competent extrinsic evidence that the precise point or question in issue in the
second suit was involved and decided in the first. And in determining whether a given
question was an issue in the prior action, it is proper to look behind the judgment to
ascertain whether the evidence necessary to sustain a judgment in the second action
would have authorized a judgment for the same party in the first action. [39]
In the present case, before the private respondents filed their first
complaint, they already knew that the balance of their account with the bank
was P4,500,000.00. They even offered to make a P1,000,000.00 partial
payment of their loan to reduce their account to P3,500,000.00. These are
gleaned from the averments in the first complaint:

7. That the long process of negotiation for the right-of-way has unnecessarily delayed
the project of the plaintiffs and has nearly caused the foreclosure of the mortgage
property by the private defendant Bank, however, the said foreclosure was held in
abeyance when plaintiffs offered to pay the additional amount of P1,000,000.00 which
should leave a balance of the loan in the amount of P3,500,000.00;[40]

10. That as the auction sale was highly irregular, obviously, the only bidder is the
defendant Bank for the price limited to the remaining balance of the loan in the
amount of P4,500,000.00, no more, no less;[41]

More telling is the private respondents failure to object to the extrajudicial


foreclosure of the real estate mortgage and the sale at public auction; they
even pleaded to be allowed to redeem the property after it had already been
sold at public auction. Patently then, the respondents were proscribed from
claiming that the foreclosure of the real estate mortgage was for an amount in
excess of the balance of their account and that the sale at public auction was
irregular/illegal. As the Court held in Aclon v. Court of Appeals:[42]

In the absence of evidence proving that a judgment debtor was merely trying to
protect himself or save his property, and that no reliance could or should have been
placed upon his action in so doing, an attempt to redeem from an execution sale has
been construed as a waiver of defects or irregularities therein, precluding him from
relying upon them for the purpose of challenging its validity. When Aclon sought to
redeem his property from PNB he never made any reservation with respect to his right
to question the validity of the auction sale and to seek alternative relief before the
courts. In other words, there was no indication whatsoever that he does not recognize
the validity of the sale. If petitioner indeed felt that the assailed foreclosure
proceedings were attended with any irregularity he should have filed the appropriate
action with the court. Instead, he offered to repurchase the subject properties without
any condition or reservation. Nevertheless, Aclon failed to comply with his
undertaking and instead defaulted in his subsequent payments.
Redemption is inconsistent with the claim of invalidity of the sale.
Redemption is an implied admission of the regularity of the sale and would
estop the respondents from later impugning its validity on that ground. [43] Thus,
the private respondents pleas for extensions of time to redeem the subject
property are of the same genre.

The private respondents admitted in their complaint in the first case that
the bank only gave a one-month extension to redeem the property. Indeed,
they made this declaration in their letter to the bank, dated July 2, 1999, copy
of which was appended to their complaint (and thus made an integral part
thereof), to wit:

Mr. Sonny Justiniano

Acquired Assets

International Exchange Bank

Salcedo Tower

169 H.V. De la Costa St.,

Salcedo Village, Makati City

Dear Sir:

Your deadline of September 7, 1999 is already fast approaching. Our action program
to redeem the property has been stalled due to the infighting of the homeowners
association members. We were not permitted to build access road to the property.
They wont allow our equipment to pass and start work unless we get the approval of
all the members. At present, there are two factions and they are at odds with each.
Either side does not recognize the existence of the other. Our only option at the
moment is to go to court and you know very well that this takes time.

Our interested buyers wont budge unless they see improvements in the property like
in place drainage system and access road. We are ready to start work, however, the
association has prevented us based on [the] above-stated reasons.

We have no other alternative but to once again appeal to you. We respectfully request
for an extension of six months from September 7, 1999 to enable us to sort the
association problem by court proceedings and place in motion our action program to
redeem the property.

We pray that your kind heart will once again grant our request.

Thank you very much.

Very truly yours,

(Sgd.)

GAUDENCIO DIGOS[44]

If indeed the bank made an erroneous computation of the balance of their


account as claimed by the private respondents in their second complaint, this
should have been alleged in the first complaint as one of their causes of
action. They failed to do so. The private respondents unequivocably admitted
in their first complaint that the balance of their account with the bank
was P4,500,000.00 which was the precise amount for which the bank sought
the foreclosure of the real estate mortgage and the sale of the property at
public auction; they even sought judicial recourse to enable them to redeem
the property despite the lapse of the one-year period therefor.

Relying on these admissions on the part of the private respondents, and


the fact that the bank has already consolidated its title over the property, the
Court thus dismissed their first complaint. The Order of the Court dismissing
the first complaint is a judgment of the case on the merits.

The attempt of the respondents in their second complaint to avoid the


application of the principle of res judicata by claiming the nature of their
account on the ground therefor and their legal theory cannot prosper. Case
law has it that where a right, question or fact is distinctly put in issue and
directly determined by a court of competent jurisdiction in a first case,
between the same parties or their privies, the former adjudication of that fact,
right or question is binding on the parties or their privies in a second suit
irrespective of whether the causes of action are the same. [45] The ruling of the
CA that the action of the private respondents and their legal theory in their
second complaint were different from their causes of action and legal theory in
the first complaint is not correct. A different cause of action is one that
proceeds not only on a sufficiently different legal theory, but also on a different
factual footing as not to require the trial of facts material to the former suit; that
is, an action that can be maintained even if all disputed factual issues raised
in the plaintiffs original complaint are concluded in defendants favor.[46]

In this case, the private respondents second complaint cannot be


maintained without trying the facts material to the first case, and the second
case cannot be maintained if all the disputed factual issues raised in the first
complaint are considered in favor of the bank.

The principle of res judicata applies when the opportunity to raise an issue
in the first complaint exists but the plaintiff failed to do so. Indeed, if the
pleading of a different legal theory would have convinced the trial court to
decide a particular issue in the first action which, with the use of diligence the
plaintiffs could have raised therein but failed to do so, they are barred by res
judicata.[47] Nor do legal theories operate to constitute a cause of action. New
legal theories do not amount to a new cause of action so as to defeat the
application of the principle of res judicata.[48]

Indeed, in Siegel v. Knott,[49] it was held that the statement of a different


form of liability is not a different cause of action, provided it grows out of the
same transaction or act and seeks redress for the wrong. Two actions are not
necessarily for different causes of action simply because the theory of the
second would not have been open under the pleadings in the first. A party
cannot preserve the right to bring a second action after the loss of the first,
merely by having circumscribed and limited theories of recovery opened by
the pleadings in the first.[50]

It bears stressing that a party cannot divide the grounds for recovery.[51] A
plaintiff is mandated to place in issue in his pleading, all the issues existing
when the suit began. A lawsuit cannot be tried piecemeal. [52] The plaintiff is
bound to set forth in his first action every ground for relief which he claims to
exist and upon which he relied, and cannot be permitted to rely upon them by
piecemeal in successive action to recover for the same wrong or injury.[53]

A party seeking to enforce a claim, legal or equitable, must present to the


court, either by the pleadings or proofs, or both, on the grounds upon which to
expect a judgment in his favor. He is not at liberty to split up his demands, and
prosecute it by piecemeal or present only a portion of the grounds upon which
a special relief is sought and leave the rest to the presentment in a second
suit if the first fails. There would be no end to litigation if such piecemeal
presentation is allowed.[54]

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The


Decision and Resolution of the Court of Appeals and the assailed Order of the
RTC are SET ASIDE. The Regional Trial Court is ORDERED to dismiss the
complaint in Civil Case No. Q-01-44227.

SO ORDERED.

SECOND DIVISION

[G.R. No. 144018. June 23, 2003]

FAR EAST BANK AND TRUST CO. (now BANK OF THE PHILIPPINE
ISLANDS), petitioner, vs. TOMAS TOH, SR., AND REGIONAL
TRIAL COURT, MANDALUYONG CITY, BRANCH
214, respondents.

RESOLUTION
QUISUMBING, J.:
Assailed in this petition for review on certiorari is the Resolution dated
[1]

June 26, 2000 of the Court of Appeals in CA-G.R. SP No. 59234, which
dismissed petitioners petition and affirmed the Order dated May 26, 2000 of
[2]

the Regional Trial Court (RTC) of Mandaluyong City, Branch 214 in Civil Case
No. MC-99-643 granting private respondents motion for discretionary
execution because of private respondents advanced age. Likewise challenged
is the appellate courts Resolution dated July 10, 2000, denying petitioners
[3]

motion for reconsideration in CA-G.R. SP No. 59234.

The factual antecedents of this case, as culled from the records, are as
follows:

On March 17, 1999, Tomas Toh, Sr., private respondent herein, filed Civil
Case No. MC-99-643 against petitioner Far East Bank & Trust Co. (FEBTCO
now merged in Bank of the Philippine Islands), seeking recovery of his bank
deposits with petitioner in the amount of P2,560,644.68 plus damages. In his
complaint, Toh claimed that petitioner had debited, without Tohs knowledge
and consent, said amount from his savings and current accounts with
petitioner bank and then applied the money as payment for the Letters of
Credit availed of by Catmon Sales International Corporation (CASICO) from
petitioner. Thus, when Toh issued two checks to Anton Construction Supply,
Inc., they were dishonored by FEBTCO allegedly for having been drawn
against insufficient funds, although Toh alleged as of February 4, 1999, he had
an outstanding withdrawable balance of P2,560,644.68.

It appears that earlier on August 29, 1997, private respondent Tomas Toh,
Sr., together with his sons, Tomas Tan Toh, Jr., and Antonio Tan Toh, had
executed a Comprehensive Security Agreement in favor of petitioner, wherein
the Tohs jointly and severally bound themselves as sureties for the P22 million
credit facilities, denominated as Omnibus Line and Bills Purchased Line,
earlier granted by petitioner to CASICO. Said credit line expired on June 30,
1998, but the parties renewed the same for another year, subject to the
following amendments: (1) a reduction in the credit line from P22 million
to P7.5 million; and (2) the relief of Toh, Sr., as one of the sureties of CASICO.

In its answer to private respondents complaint, petitioner bank averred


that the debiting of Tohs bank accounts was justified due to his surety
undertaking in the event of the default of CASICO in its payments. Petitioner
further claimed that the reduction of credit line does not relieve Toh, Sr. from
his continuing surety obligation, citing the absence of a new surety
undertaking or any provisions in the renewal agreement releasing Toh, Sr.,
from his personal obligation. It pointed out that CASICOs default in its
obligations became inevitable after CASICO filed a Petition for Declaration in
a State of Suspension of Payments before the Securities and Exchange
Commission (SEC).

On July 30, 1999, private respondent filed a Motion for Judgment on the
Pleadings, which petitioner opposed. On October 15, 1999, the lower court
granted the aforesaid motion. In its Order dated March 10, 2000, the lower
court rendered a decision in favor of Toh, Sr., the dispositive portion of which
reads:

WHEREFORE, judgment is hereby rendered ordering the defendant to restore


immediately to plaintiffs savings/current accounts the amount of P2,560,644.68 plus
the stipulated interest thereon from February 17, 1999, until fully restored; and to pay
to the plaintiff the amount of P100,000.00, as moral damages; and the amount of
P50,000.00, as and by way of attorneys fees. With costs against the defendant. [4]

On March 29, 2000, Toh Sr., filed a Motion for Discretionary Execution by
invoking Section 2, Rule 39 of the Revised Rules of Court. He prayed that
[5]

execution pending appeal be granted on the ground of old age and the
probability that he may not be able to enjoy his money deposited in petitioners
bank. Petitioner duly opposed said motion.

On March 31, 2000, while private respondents motion was pending before
the RTC, petitioner filed a notice of appeal of the trial courts order of March
10, 2000.

On May 26, 2000, the RTC issued its order granting private respondents
Motion for Discretionary Execution, thus:

WHEREFORE, the motion for discretionary execution is GRANTED. The issuance of


the corresponding writ of execution for the enforcement and satisfaction of the
aforesaid decision against the defendant is hereby ordered. [6]

On May 30, 2000, petitioners appeal was given due course.

In granting Tohs motion, the trial court held that discretionary execution
may be issued upon good reasons by virtue of Section 2(a), Rule 39 of the
[7]
Revised Rules of Court. Citing De Leon v. Soriano, where we held that the
[8]

approach of the end of ones life span is a compelling cause for discretionary
execution pending appeal, the trial court used the circumstance of Tohs
[9]

advanced age as a good reason to allow execution pending appeal.

On June 16, 2000, petitioner decided to forego filing a motion for


reconsideration of the trial courts order of May 26, 2000. Instead, it brought
the matter to the Court of Appeals in a special civil action for certiorari,
docketed as CA-G.R. SP No. 59234.

On June 26, 2000, the appellate court decided CA-G.R. SP No. 59234 as
follows:

WHEREFORE, premises considered, the instant petition for certiorari is hereby


DISMISSED. [10]

The Court of Appeals pointed out that petitioner filed its petition for
certiorari without filing a motion for reconsideration. It held that the fact that
the lower court already ordered the execution of its judgment did not
constitute a situation of extreme urgency as to justify petitioners by-passing
the remedy of reconsideration. The appellate court declared it found no grave
abuse of discretion on the part of the trial court in granting discretionary
execution. For the trial court had determined that Toh Sr. was already 79 years
old and given his advanced age, might not be able to enjoy the fruits of a
judgment favorable to him if he were to wait for the eventual resolution of the
appeal filed by petitioner.

Petitioner filed its Motion for Reconsideration but the Court of Appeals
denied it on July 10, 2000.

Hence, this petition where petitioner submits the following issues for our
resolution:

1) WHETHER OR NOT THE FILING OF A MOTION FOR RECONSIDERATION IS


NECESSARY BEFORE PETITIONER BANK CAN ASSAIL THE LOWER COURTS
ORDER DATED MAY 26, 2000 IN A SPECIAL CIVIL ACTION FOR CERTIORARI
BEFORE THE HONORABLE COURT OF APPEALS.

2) WHETHER OR NOT THE HONORABLE COURT OF APPEALS GRIEVOUSLY


ERRED IN RULING THAT THE LOWER COURT COMMITTED NO GRAVE ABUSE
OF DISCRETION IN ISSUING THE ORDER OF MAY 26, 2000.[11]
At the outset, it bears stressing that the first issue is now moot. We find
that the appellate court did note petitioners procedural by-pass or
oversight. Nonetheless it proceeded to rule on the petition on its merits. The
appellate courts action is not wanting in precedents as a special civil action for
certiorari may be given due course, notwithstanding that no motion for
reconsideration has been filed before the lower court under certain
exceptional circumstances. These exceptions include instances where: (1)
[12]

the issue raised is purely one of law; (2) public interest is involved; (3) the
matter is one of urgency; (4) the question of jurisdiction was squarely raised,
submitted to, met and decided by the lower court; and (5) where the order is a
patent nullity.
[13]

Hence, the only relevant issue for our resolution now is whether the Court
of Appeals erred in affirming the lower courts Order granting execution
pending appeal on the ground of advanced age of private respondent Tomas
Toh, Sr.

Petitioner contends that the Court of Appeals erred in finding no grave


abuse of discretion on the part of the lower court when it granted the motion
for discretionary execution based on private respondents bare allegation that
he was already 79 years old.

Private respondent avers that Section 2, Rule 49 of the 1997 Rules of Civil
Procedure states the requisites for a grant of a motion pending appeal. All
these requirements and conditions were complied with as evidenced by
respondents motion for discretionary execution, petitioners opposition to the
motion and the special order issued by the Regional Trial Court stating the
good reason for the grant of the motion. Hence, the Regional Trial Court could
not have committed any grave abuse of discretion. [14]

In our view, the Court of Appeals committed no reversible error in


sustaining the lower court. Discretionary execution is permissible only when
good reasons exist for immediately executing the judgment before finality or
pending appeal or even before the expiration of the time to appeal. Good
reasons are compelling circumstances justifying the immediate execution lest
judgment becomes illusory, or the prevailing party may, after the lapse of time,
become unable to enjoy it, considering the tactics of the adverse party who
may apparently have no case except to delay. [15]
The Rules of Court does not state, enumerate, or give examples of good
reasons to justify execution. The determination of what is a good reason must,
necessarily, be addressed to the sound discretion of the trial court. In other
words, the issuance of the writ of execution must necessarily be controlled by
the judgment of the judge in accordance with his own conscience and by a
sense of justice and equity, free from the control of anothers judgment or
conscience. It must be so for discretion implies the absence of a hard and fast
rule.
[16]

In this case, the trial court granted private respondents motion for
discretionary execution due to his advanced age, citing our ruling in De Leon
v. Soriano. It concluded that old age is a good reason to allow execution
[17]

pending appeal as any delay in the final disposition of the present case may
deny private respondent of his right to enjoy fully the money he has with
defendant bank. The Court of Appeals found said ruling in conformity with
[18]

sound logical precepts, inspired as it is by the probability that the lapse of time
would render the ultimate judgment ineffective. It further stressed that the trial
court was in the vantage position to determine whether private respondents
advanced age and state of health would merit the execution private
respondent prayed for.

In De Leon, we upheld immediate execution of judgment in favor of a 75-


year-old woman. We ruled that her need of and right to immediate execution
of the decision in her favor amply satisfied the requirement of a paramount
and compelling reason of urgency and justice, outweighing the security
offered by the supersedeas bond. In the subsequent case of Borja v. Court
[19]

of Appeals, we likewise allowed execution pending appeal in favor of a 76


[20]

year-old man on the ground that the appeal will take years to decide with
finality, and he might very well be facing a different judgment from a Court
higher than any earthly tribunal and the decision on his complaint, even if it be
in his favor, would have become meaningless as far as he himself was
concerned. [21]

In the present case, private respondent Toh is already 79 years old. It


cannot, by any stretch of imagination, be denied that he is already of
advanced age. Not a few might be fortunate to live beyond 79 years. But no
one could claim with certainty that his tribe would be always blessed with long
life.
Private respondent obtained a favorable judgment in the trial court. But
that judgment in Civil Case No. MC-99-643 is still on appeal before the Court
of Appeals. It might even reach this Court before the controversy is finally
resolved with finality. As well said in Borja, while we may not agree that a man
of his years is practically moribund, the Court can appreciate his
apprehension that he will not be long for this world and may not enjoy the fruit
of the judgment before he finally passes away. [22]

Petitioner avers that private respondents claim of old age was


unsubstantiated by clear and convincing evidence. In essence, petitioner
wants us to re-evaluate this factual issue.Needless to stress, such re-
examination is improper in a petition for review on certiorari. Here, only
questions of law should be raised. Factual findings of the trial court, when
[23]

affirmed by the appellate court, bind this Court and are entitled to utmost
respect. No cogent reason having been given for us to depart therefrom we
[24]

shall stand by this salutary rule.

WHEREFORE, the petition is DENIED for lack of merit. The assailed


resolutions of the Court of Appeals in CA-G.R. SP No. 59234 are
AFFIRMED. Costs against petitioner.

SO ORDERED.

FIRST DIVISION

ROGELIO (ROGER) PANOTES G.R. No. 154739


(thru ARACELI BUMATAY, as
successor-in-interest), Present:
Petitioner,
PUNO, C.J., Chairperson,
SANDOVAL-GUTIERREZ,
CORONA,
- versus - AZCUNA, and
GARCIA, JJ.

CITY TOWNHOUSE Promulgated:


DEVELOPMENT CORPORATION,
Respondent. January 23, 2007

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

DECISION

SANDOVAL-GUTIERREZ, J.:

For our resolution is the instant Petition for Review on Certiorari assailing the
Decision[1] of the Court of Appeals dated January 29, 2002 in CA-G.R. SP No.
52621 and its Resolution[2] dated August 5, 2002 denying the motion for
reconsideration.

This case stemmed from a complaint filed with the National Housing Authority
(NHA) in April 1979 by Rogelio (Roger) Panotes, petitioner, then president of the
Provident Village Homeowners Association, Inc., against Provident Securities
Corporation (PROSECOR), owner-developer of
the Provident Village in Marikina City. The complaint, docketed as NHA Case No.
4175, alleges that PROSECOR violated Sections 19, 20, 21, 38, and 39 of
Presidential Decree (P.D.) No. 957.[3] One of the violations complained of was its
failure to provide an open space in the said subdivision.

During the proceedings before the NHA, an ocular inspection showed that the
subdivision has no open space. The NHA found, however, that Block 40, with an
area of 22,916 square meters, could be utilized as open space. Thus, in its
Resolution dated August 14, 1980, the NHA directed PROSECOR to provide
the Provident Village an open space which is Block 40.

In a letter of the same date, then NHA Acting General Manager Antonio A.
Fernando ordered PROSECOR to provide Block 40 of the subdivision as open
space.

PROSECOR was served copies of the NHA Resolution and the letter on August
22, 1980.

Considering that PROSECOR did not appeal from the NHA Resolution, it became
final and executory.

When Panotes filed a motion for execution of the NHA Resolution, it was found
that the records of the case were mysteriously missing. Hence, his motion was
provisionally dismissed without prejudice.

Meanwhile, PROSECOR sold to City Townhouse Development Corporation


(CTDC), respondent, several lots in the subdivision. Among the lots sold were
those comprising Block 40. CTDC was unaware of the NHA Resolution ordering
PROSECOR to have Block 40 utilized as open space of Provident Village.

Eventually, Panotes was succeeded by Araceli Bumatay as president of the


Provident Village Homeowners Association, Inc. On July 17, 1990, she filed with
the Housing and Land Use Regulatory Board (HLURB) a complaint for revival of
the NHA Resolution dated August 14, 1980. Impleaded therein as defendant was
CTDC, whom she alleged as successor-in-interest of PROSECOR.

In its answer, CTDC averred, among others, that (1) Araceli Bumatay has no legal
personality to file the action for revival of judgment; (2) there is a pending
litigation between CTDC and PROSECOR involving Block 40; and (3) other
entities like the Bangko Sentral Ng Pilipinas and Provident Savings Bank have
existing liens over Block 40.

On October 15, 1991, the HLURB, through Housing and Land Use
Arbiter Charito M. Bunagan, rendered its Decision in favor of Bumatay, reviving
the NHA Resolution and declaring Block 40 of the Provident Village as open space
for the said subdivision, thus:

WHEREFORE, premises considered, judgment is hereby rendered


declaring Block 40 (with an area of 22,916 square meters) of the
Subdivision Plan Pcs-5683 of the Provident Villages located at
Marikina, Metro Manila as the legally mandated open space for said
subdivision project; and the Register of Deeds for Marikina is hereby
directed to cause the annotation of this fact on the corresponding
Torrens Title which describes and covers said open space; said area to
be reserved and utilized exclusively in the manner and for the purposes
provided for under P.D. N0. 957 and P.D. No. 1216.[4]

Furthermore, let a Cease and Desist Order be, as it is hereby, issued


against respondent Provident Securities Corp. and City Townhouse
Development Corporation, restraining said respondents, and all persons,
agents, or other associations or corporate entities acting on their behalf,
from asserting or perpetrating any or further acts of dominion or claim
over said Block 40, Pcs-5683, the open space allocated and reserved for
the Provident Villages in Marikina, Metro Manila.

IT IS SO ORDERED.

On appeal to the HLURB Board of Commissioners, Arbiter Bunagans Decision


was affirmed with modification in the sense that CTDC has the right to recover
from PROSECORwhat it has lost.

After its motion for reconsideration was denied, CTDC then interposed an appeal
to the Office of the President (OP). On February 10, 1999, the OP rendered its
Decision affirming in toto the judgment of the HLURB Board of Commissioners.
CTDC filed a motion for reconsideration, but it was denied in a Resolution
dated April 14, 1999.

CTDC then filed with the Court of Appeals a petition for review under Rule 43 of
the 1997 Rules of Procedure, as amended, docketed therein as CA-G.R. SP No.
52621.
In a Resolution[5] dated May 10, 1999, the Court of Appeals
dismissed CTDCs petition for its failure to attach thereto a certification against
forum shopping. The Court of Appeals also found that the petition was not
supported by certified true copies of such material portions of the records and other
pertinent papers referred to in the petition.

CTDC filed a motion for reconsideration which was opposed by Bumatay.

On June 10, 1999, CTDC submitted to the Court of Appeals a certification of non-
forum shopping as well as the pleadings mentioned in its Resolution.

On July 27, 1999, the Court of Appeals issued a Resolution


granting CTDCs motion for reconsideration and reinstated its petition.

On January 29, 2002, the appellate court rendered its Decision reversing the
Decision of the OP and dismissing the complaint for revival of judgment, thus:

IN VIEW OF ALL THE FOREGOING, finding merit in this petition for


review, the assailed Decision of the Office of the President dated
February 10, 1999, together with its Resolution dated February 14, 1999
are REVERSED and SET ASIDE, and a new one entered dismissing
HLRB Case No. REM-071790-4052 (NHA Case No. 4175; HLRB Case
No. REM-A-1089). Costs against the respondent.

SO ORDERED.
The basic issue for our resolution is whether the NHA Resolution dated August 14,
1980 may be enforced against CTDC.

An action for revival of judgment is no more than a procedural means of securing


the execution of a previous judgment which has become dormant after the passage
of five years without it being executed upon motion of the prevailing party. It is not
intended to re-open any issue affecting the merits of the judgment debtors case nor
the propriety or correctness of the first judgment.[6]
Here, the original judgment or the NHA Resolution sought to be revived was
between Rogelio Panotes and PROSECOR, not
between petitioner Araceli Bumatay and respondent CTDC.

In maintaining that CTDC is bound by the NHA Resolution, petitioner claims that
CTDC is the successor-in-interest of PROSECOR and, therefore, assumed the
obligations of the latter to provide an open space for Provident Village.

CTDC purchased from PROSECOR Block 40 in the said village, not as an owner-
developer like PROSECOR, but as an ordinary buyer of lots. Even after the sale,
CTDC did not become an owner-developer. The Deed of Sale executed by CTDC,
as buyer, and PROSECOR, as seller, shows that the subject matter of the sale is the
unsold lots comprising Block 40 within the subdivision to CTDC. The contract
does not include the transfer of rights of PROSECOR as owner-developer of the
said subdivision. Clearly, there is no basis to conclude that CTDC is the successor-
in-interest of PROSECOR.

It bears stressing that when CTDC bought Block 40, there was no annotation
on PROSECORs title showing that the property is encumbered. In fact, the NHA
Resolution was not annotated thereon. CTDC is thus a buyer in good faith and for
value, and as such, may not be deprived of the ownership of Block 40. Verily, the
NHA Resolution may not be enforced against CTDC.

Section 2 of P.D. No. 1216 provides:

Section 2. Section 31 of Presidential Decree No. 957 is hereby


amended to read as follows:

Section 31. Roads, Alleys, Sidewalks and Open


Spaces. The owner or developer of a subdivision
shall provide adequate roads, alleys and
sidewalks. For subdivision projects of one (1)
hectare or more, the owner shall reserve thirty
percent (30%) of the gross area for open space.
xxx xxx xxx.
Clearly, providing an open space within the subdivision remains to be the
obligation of PROSECOR, the owner-developer and the real party-in-interest in the
case for revival of judgment. As aptly held by the Court of Appeals:

Quintessentially, the real party-in-interest in the revival of NHA


Case No. 4175 is PROSECOR and not CTDC. PROSECOR was the
lone defendant or respondent in that case against whom judgment was
rendered. To insist that CTDC is a successor-in-interest of PROSECOR
may have some truth if we are talking about the ownership of the lots
sold by PROSECOR in favor of CTDC as a result of a civil action
between the two. But then, to hold CTDC as the successor-in-interest of
PROSECOR as the developer of the subdivision, is far from
realty. CTDC is simply on the same footing as any lot buyer-member of
PVHIA. x x x.

Furthermore, strangers to a case, like CTDC, are not bound by the judgment
rendered by a court. It will not divest the rights of a party who has not and never
been a party to a litigation. Execution of a judgment can be issued only against a
party to the action and not against one who did not have his day in court.[7]

WHEREFORE, we DENY the petition and AFFIRM the assailed Decision and
Resolution of the Court of Appeals in CA-G.R. SP No. 52621. Costs against
petitioner.

SO ORDERED.
THIRD DIVISION

STRONGHOLD INSURANCE G.R. No. 148090


COMPANY, INC.,
Petitioner, Present:
QUISUMBING, J.,
Chairperson,
- versus - CARPIO,
CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.

HONORABLE NEMESIO S. FELIX,


in his capacity as Presiding Judge of
Branch 56, Regional Trial Court,
Makati City, RICHARD C. JAMORA, Promulgated:
Branch Clerk of Court, and
EMERITA GARON,
Respondents. November 28, 2006

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

DECISION

CARPIO, J.:

The Case
Before the Court is a petition for review[1] assailing the 4 May 2001 Decision[2] of
the Court of Appeals in CA-G.R. SP No. 63334.

The Antecedent Facts

Emerita Garon (Garon) filed an action for sum of money docketed as Civil Case
No. 99-1051 against Project Movers Realty and Development Corporation (Project
Movers) and Stronghold Insurance Company, Inc. (Stronghold Insurance). In an
Order[3] dated 19 September 2000, the Regional Trial Court of Makati City, Branch
56[4] (trial court) granted Garons motion for summary judgment. The trial court
rendered judgment in favor of Garon, as follows:

1. Defendant Project Movers Realty and Development Corporation


is hereby directed to pay plaintiff as follows:

On Promissory Note No. PMRDC 97-12-332:

(A) The sum of PESOS: Six Million Eighty Eight Thousand


Seven Hundred Eighty Three and 68/100 (P6,088,783.68)
under PMRDC-97-12-332;

(B) Interest thereon at 36% per annum computed from 19


December 1997 until fully paid;

(C) A penalty of 3% per month computed from 03 November


1998 until full payment on all unpaid amounts consisting
of the principal and interest.

On Promissory Note No. PMRDC No. 97-12-333:

(A) The peso equivalent of the sum of DOLLARS: One


Hundred Eighty Nine Thousand Four Hundred Eighteen
and 75/100 (US$189,418.75) under PMRDC-97-12-333;

(B) Interest thereon at the stipulated rate of 17% per annum


computed from 31 December 1997;

(C) A penalty of 3% per month computed from 03 November


1998 until full payment on all unpaid amounts consisting of
the principal and interest.
2. Defendant Stronghold Insurance Company, Inc. is hereby
held jointly and solidarily liable to plaintiff Mrs. Garon in the
amount of PESOS: TWELVE MILLION SEVEN HUNDRED
FIFTY FIVE THOUSAND ONE HUNDRED THIRTY
NINE AND EIGHTY FIVE CENTAVOS (P12,755,139.85).

3. Defendants Project Movers Realty and Development Corporation and


Stronghold Insurance Company, Inc. are also ordered to pay plaintiff
Mrs. Garon jointly and severally the sum of PESOS: TWO HUNDRED
THOUSAND as attorneys fees plus costs of suit.

All other claims and counter-claims of the parties are hereby ordered
dismissed.

SO ORDERED.[5]

On 6 October 2000, Garon filed a motion for execution pending appeal. On 10


October 2000, Stronghold Insurance moved for the reconsideration of the 19
September 2000 Order of the trial court.

In an Order[6] dated 23 January 2001, the trial court denied Stronghold Insurances
motion for reconsideration for lack of merit.

In an Order[7] dated 8 February 2001, the trial court granted Garons motion for
execution pending appeal. The trial court ordered Garon to post a bond of P20
million to answer for any damage that Project Movers and Stronghold Insurance
may sustain by reason of the execution pending appeal. On 14 February 2001,
Branch Clerk of Court Richard C. Jamora (Jamora) issued a writ of execution
pending appeal.

On 16 February 2001, Stronghold Insurance filed a notice of appeal.

Stronghold Insurance also filed a petition for certiorari before the Court of Appeals
to assail the trial courts 8 February 2001 Order and the writ of execution pending
appeal. In its Resolution[8] of 23 February 2001, the Court of Appeals enjoined the
trial court, Jamora and Garon from enforcing the 8 February 2001 Order. However,
it turned out that notices of garnishment had been served before the Court of
Appeals issued the temporary restraining order (TRO). In its Order[9] dated 7
March 2001, the trial court denied Stronghold Insurances Urgent Motion for the
recall of the notices of garnishment.

The Ruling of the Court of Appeals


In its 4 May 2001 Decision, the Court of Appeals dismissed the petition of
Stronghold Insurance and lifted the TRO it issued.

The Court of Appeals sustained the trial court in issuing the writ of execution
pending appeal on the ground of illness of Garons husband. Citing Articles
68[10] and 195[11] of the Family Code, the Court of Appeals held that while it was
not Garon who was ill, Garon needed the money to support her husbands medical
expenses and to support her family.

Stronghold Insurance alleged that its liability is limited only to P12,755,139.85 in


accordance with its surety bond with Project Movers, plus attorneys fees
of P200,000 as awarded by the trial court. However, the amount in the writ of
execution pending appeal and notices of garnishment is P56 million. Nevertheless,
the Court of Appeals ruled that Stronghold Insurance failed to show that more
than P12,755,139.85 had been garnished.
Hence, the petition before this Court.

In its Resolution[12] dated 8 August 2001, this Court issued a TRO to restrain and
enjoin the enforcement of the 8 February 2001 Order and the writ of execution
pending appeal until further orders from this Court.

The Issue

The sole issue is whether there are good reasons to justify execution pending
appeal.

The Ruling of This Court

The petition has merit.

Requisites of Execution Pending Appeal


Execution pending appeal is governed by paragraph (a), Section 2, Rule 39 of the
1997 Rules of Civil Procedure (Rules) which provides:

SEC. 2. Discretionary execution. -

(a) Execution of a judgment or final order pending appeal. - On motion


of the prevailing party with notice to the adverse party filed in the trial
court while it has jurisdiction over the case and is in possession of either
the original record or the record on appeal, as the case may be, at the
time of the filing of such motion, said court may, in its discretion, order
execution of a judgment or final order even before the expiration of the
period to appeal.

After the trial court has lost jurisdiction, the motion for execution
pending appeal may be filed in the appellate court.

Discretionary execution may only issue upon good reasons to be stated


in a special order after due hearing.

xxxx

Execution pending appeal is an exception to the general rule. The Court explained
the nature of execution pending appeal as follows:

Execution pending appeal is an extraordinary remedy, being more of the


exception rather than the rule. This rule is strictly construed against
the movant because courts look with disfavor upon any attempt to
execute a judgment which has not acquired finality. Such execution
affects the rights of the parties which are yet to be ascertained on appeal .
[13]

The requisites for the grant of an execution of a judgment pending appeal are the
following:

(a) there must be a motion by the prevailing party with notice to the adverse party;

(b) there must be good reasons for execution pending appeal;


(c) the good reasons must be stated in the special order.[14]

As a discretionary execution, execution pending appeal is permissible only when


good reasons exist for immediately executing the judgment before finality or
pending appeal or even before the expiration of the period to appeal. [15] Good
reasons, special, important, pressing reasons must exist to justify execution
pending appeal; otherwise, instead of an instrument of solicitude and justice, it
may well become a tool of oppression and inequality.[16] Good reasons consist of
exceptional circumstances of such urgency as to outweigh the injury or damage
that the losing party may suffer should the appealed judgment be reversed later.[17]

Existence of Good Grounds to Justify Execution Pending Appeal

In this case, Garon anchors the motion for execution pending appeal on the
following grounds:

(a) any appeal which Project Movers and Stronghold Insurance may take from the
summary judgment would be patently dilatory;
(b) the ill health of Garons spouse and the spouses urgent need for the funds owed
to them by Project Movers and Stronghold Insurance constitute good reasons for
execution pending appeal; and

(c) Garon is ready and willing to post a bond to answer for any damage Project
Movers and Stronghold Insurance may suffer should the trial courts decision be
reversed on appeal.[18]

In granting the motion for execution pending appeal, the trial court ruled:

A perusal of [t]he records of the instant case will sustain plaintiffs claim
that defendants raised no valid or meritorious defenses against the claims
of plaintiff. The Court notes with interest the fact that defendants
admitted the genuineness and due execution of the Promissory Notes and
Surety Agreement sued upon in this case.

The instant case simply turns on the issues of (i) whether or not there was
a valid, due and demandable obligation and (ii) whether or not the
obligation had been extinguished in the manner provided for under our
laws. The Answers of defendants contained admissions that the
obligation was valid and subsisting and that the same was due and
unpaid. Founded as it is on Promissory Notes and Surety Agreements,
the authenticity and due execution of which had been admitted, the Court
is convinced that plaintiff is entitled to a judgment in her favor and that
any appeal therefrom will obviously be a ploy to delay the proceedings
(See Home Insurance Company vs. Court of Appeals, 184 SCRA 318).
The second ground relied upon by plaintiff is also impressed with
merit. In Ma-ao Sugar Central vs. Canete, 19 SCRA 646, the Supreme
Court held that the movant was entitled to execution pending appeal of
an award of compensation, ruling that his ill health and urgent need for
the funds so awarded were considered good reasons to justify execution
pending appeal (See also De Leon vs. Soriano, 95 Phil. 806).
It is established that plaintiffs spouse, Mr. Robert Garon, suffers from
coronary artery disease, benign Prostatic Hyperplasia
and hyperlipidemia. He is undergoing continuous treatment for the
foregoing ailments and has been constrained to make serious lifestyle
changes, that he can no longer actively earn a living. As shown in
plaintiffs verified motion, she has urgent need of the funds owed to her
by defendants in order to answer for her husbands medical expenses and
for the day-to-day support of the family considering her husbands ill
health. The Court therefore finds and holds that there exists good reasons
warranting an execution pending appeal.[19]

The trial court ruled that an appeal from its 19 September 2000 Order is only a
ploy to delay the proceedings of the case. However, the authority to determine
whether an appeal is dilatory lies with the appellate court. [20] The trial courts
assumption that the appeal is dilatory prematurely judges the merits of the main
case on appeal.[21] Thus:

Well-settled is the rule that it is not for the trial court to determine the
merit of a decision it rendered as this is the role of the appellate
Court. Hence, it is not within the competence of the trial court, in
resolving the motion for execution pending appeal, to rule that the
appeal is patently dilatory and to rely on the same as the basis for finding
good reason to grant the motion.[22]
In a Decision[23] promulgated on 7 May 2004 in CA-G.R. CV No. 69962
entitled Emerita Garon v. Project Movers Realty and Development Corporation, et
al., the Court of Appeals sustained the trial court in rendering the summary
judgment in Civil Case No. 99-1051. However, the Court of Appeals ruled that
Stronghold Insurance could not be held solidarily liable with Project Movers. The
Court of Appeals ruled that the surety bond between Project Movers and
Stronghold Insurance expired on 7 November 1998 before the maturity of Project
Movers loans on 17 December 1998 and 31 December 1998, respectively. Hence,
when the loans matured, the liability of Stronghold Insurance had long ceased. The
Court of Appeals affirmed the trial courts 19 September 2000 Order with
modification by ruling that Stronghold Insurance is not liable to Garon.

The 7 May 2004 Decision of the Court of Appeals is not yet final. It is the subject
of a petition for review filed by Garon before this Court. The case, docketed as
G.R. No. 166058, is still pending with this Court. While this Court may either
affirm or reverse the 7 May 2004 Decision of the Court of Appeals, the fact that the
Court of Appeals absolved Stronghold Insurance from liability to Garon shows that
the appeal from the 19 September 2000 Order is not dilatory on the part of
Stronghold Insurance.

We agree with Stronghold Insurance that Garon failed to present good reasons to
justify execution pending appeal. The situations in the cases cited by the trial court
are not similar to this case. In Ma-Ao Sugar Central Co., Inc. v. Caete,
[24]
Caete filed an action for compensation for his illness. The Workmens
Compensation Commission found the illness compensable.
Considering Caetes physical condition and the Courts finding that he was in
constant danger of death, the Court allowed execution pending appeal. In De Leon,
et al. v. Soriano, et al.,[25] De Leon, et al. defaulted on an agreement that was
peculiarly personal to Asuncion. The agreement was valid only during Asuncions
lifetime.The Court considered that Sorianos health was delicate and she was 75
years old at that time. Hence, execution pending appeal was justified. In this case,
it was not Garon, but her husband, who was ill.

The posting of a bond, standing alone and absent the good reasons required under
Section 2, Rule 39 of the Rules, is not enough to allow execution pending
appeal. The mere filing of a bond by a successful party is not a good reason to
justify execution pending appeal as a combination of circumstances is the
dominant consideration which impels the grant of immediate execution. [26] The
bond is only an additional factor for the protection of the defendants creditor.[27]

The exercise of the power to grant or deny a motion for execution pending appeal
is addressed to the sound discretion of the trial court. [28] However, the existence of
good reasons is indispensable to the grant of execution pending appeal.
[29]
Here, Garon failed to advance good reasons that would justify the execution
pending appeal.

Execution Pending Appeal against Stronghold Insurance


Exceeds its Liability under the Trial Courts Order

The dispositive portion of the trial courts 19 September 2000 Order states:

WHEREFORE, premises considered[,] this Court hereby renders


judgment in favor of the plaintiff Mrs. Emerita I. Garon as follows:

xxxx

2. Defendant Stronghold Insurance Company, Inc. is hereby held jointly


and solidarily liable to plaintiff Mrs. Garon in the amount of
PESOS: TWELVE MILLION SEVEN HUNDRED FIFTY FIVE
THOUSAND ONE HUNDRED THIRTY NINE AND EIGHTY FIVE
CENTAVOS (P12,755,139.85).

3. Defendants Project Movers Realty and Development Corporation and


Stronghold Insurance Company, Inc. are also ordered to pay plaintiff
Mrs. Garon jointly and severally the sum of PESOS: TWO HUNDRED
THOUSAND as attorneys fees plus costs of suit.

x x x x[30]

The writ of execution pending appeal issued against Project Movers and
Stronghold Insurance is for P56 million.[31] However, the Court of Appeals ruled
that Stronghold Insurance failed to show that more than P12,755,139.85 had been
garnished. The ruling of the Court of Appeals unduly burdens Stronghold
Insurance because the amount garnished could exceed its liability. It gives the
sheriff the discretion to garnish more than P12,755,139.85 from the accounts of
Stronghold Insurance. The amount for garnishment is no longer ministerial on the
part of the sheriff. This is not allowed. Thus:

Leaving to the Sheriff, as held by the Court of Appeals, the


determination of the exact amount due under the Writ would be
tantamount to vesting such officer with judicial powers. He would have
to receive evidence to determine the exact amount owing. In his hands
would be placed a broad discretion that can only lead to delay and open
the door to possible abuse. The orderly administration of justice requires
that the amount on execution be determined judicially and the duties of
the Sheriff confined to purely ministerial ones .[32]

WHEREFORE, we SET ASIDE the 4 May 2001 Decision of the Court of


Appeals in CA-G.R. SP No. 63334. We also SET ASIDE the 8 February 2001
Order of the Regional Trial Court of Makati City, Branch 56 and the writ of
execution pending appeal issued on 14 February 2001. We make permanent the
temporary restraining order we issued on 8 August 2001.

SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 196049 June 26, 2013

MINORU FUJIKI, PETITIONER,


vs.
MARIA PAZ GALELA MARINAY, SHINICHI MAEKARA, LOCAL CIVIL REGISTRAR OF QUEZON
CITY, AND THE ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE NATIONAL
STATISTICS OFFICE, RESPONDENTS.

DECISION

CARPIO, J.:

The Case

This is a direct recourse to this Court from the Regional Trial Court (RTC), Branch 107, Quezon City,
through a petition for review on certiorari under Rule 45 of the Rules of Court on a pure question of
law. The petition assails the Order1 dated 31 January 2011 of the RTC in Civil Case No. Q-11-68582
and its Resolution dated 2 March 2011 denying petitioners Motion for Reconsideration. The RTC
dismissed the petition for "Judicial Recognition of Foreign Judgment (or Decree of Absolute Nullity of
Marriage)" based on improper venue and the lack of personality of petitioner, Minoru Fujiki, to file the
petition.

The Facts

Petitioner Minoru Fujiki (Fujiki) is a Japanese national who married respondent Maria Paz Galela
Marinay (Marinay) in the Philippines2 on 23 January 2004. The marriage did not sit well with
petitioners parents. Thus, Fujiki could not bring his wife to Japan where he resides. Eventually, they
lost contact with each other.

In 2008, Marinay met another Japanese, Shinichi Maekara (Maekara). Without the first marriage
being dissolved, Marinay and Maekara were married on 15 May 2008 in Quezon City, Philippines.
Maekara brought Marinay to Japan. However, Marinay allegedly suffered physical abuse from
Maekara. She left Maekara and started to contact Fujiki. 3

Fujiki and Marinay met in Japan and they were able to reestablish their relationship. In 2010, Fujiki
helped Marinay obtain a judgment from a family court in Japan which declared the marriage between
Marinay and Maekara void on the ground of bigamy.4 On 14 January 2011, Fujiki filed a petition in
the RTC entitled: "Judicial Recognition of Foreign Judgment (or Decree of Absolute Nullity of
Marriage)." Fujiki prayed that (1) the Japanese Family Court judgment be recognized; (2) that the
bigamous marriage between Marinay and Maekara be declared void ab initio under Articles 35(4)
and 41 of the Family Code of the Philippines;5 and (3) for the RTC to direct the Local Civil Registrar
of Quezon City to annotate the Japanese Family Court judgment on the Certificate of Marriage
between Marinay and Maekara and to endorse such annotation to the Office of the Administrator and
Civil Registrar General in the National Statistics Office (NSO).6

The Ruling of the Regional Trial Court

A few days after the filing of the petition, the RTC immediately issued an Order dismissing the
petition and withdrawing the case from its active civil docket.7 The RTC cited the following provisions
of the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable
Marriages (A.M. No. 02-11-10-SC):

Sec. 2. Petition for declaration of absolute nullity of void marriages.

(a) Who may file. A petition for declaration of absolute nullity of void marriage may be filed solely
by the husband or the wife.

xxxx

Sec. 4. Venue. The petition shall be filed in the Family Court of the province or city where the
petitioner or the respondent has been residing for at least six months prior to the date of filing, or in
the case of a non-resident respondent, where he may be found in the Philippines, at the election of
the petitioner. x x x

The RTC ruled, without further explanation, that the petition was in "gross violation" of the above
provisions. The trial court based its dismissal on Section 5(4) of A.M. No. 02-11-10-SC which
provides that "[f]ailure to comply with any of the preceding requirements may be a ground for
immediate dismissal of the petition."8 Apparently, the RTC took the view that only "the husband or
the wife," in this case either Maekara or Marinay, can file the petition to declare their marriage void,
and not Fujiki.

Fujiki moved that the Order be reconsidered. He argued that A.M. No. 02-11-10-SC contemplated
ordinary civil actions for declaration of nullity and annulment of marriage. Thus, A.M. No. 02-11-10-
SC does not apply. A petition for recognition of foreign judgment is a special proceeding, which
"seeks to establish a status, a right or a particular fact," 9 and not a civil action which is "for the
enforcement or protection of a right, or the prevention or redress of a wrong." 10 In other words, the
petition in the RTC sought to establish (1) the status and concomitant rights of Fujiki and Marinay as
husband and wife and (2) the fact of the rendition of the Japanese Family Court judgment declaring
the marriage between Marinay and Maekara as void on the ground of bigamy. The petitioner
contended that the Japanese judgment was consistent with Article 35(4) of the Family Code of the
Philippines11on bigamy and was therefore entitled to recognition by Philippine courts. 12

In any case, it was also Fujikis view that A.M. No. 02-11-10-SC applied only to void marriages under
Article 36 of the Family Code on the ground of psychological incapacity.13 Thus, Section 2(a) of A.M.
No. 02-11-10-SC provides that "a petition for declaration of absolute nullity of void marriages may be
filed solely by the husband or the wife." To apply Section 2(a) in bigamy would be absurd because
only the guilty parties would be permitted to sue. In the words of Fujiki, "[i]t is not, of course, difficult
to realize that the party interested in having a bigamous marriage declared a nullity would be the
husband in the prior, pre-existing marriage."14 Fujiki had material interest and therefore the
personality to nullify a bigamous marriage.
Fujiki argued that Rule 108 (Cancellation or Correction of Entries in the Civil Registry) of the Rules of
Court is applicable. Rule 108 is the "procedural implementation" of the Civil Register Law (Act No.
3753)15 in relation to Article 413 of the Civil Code.16 The Civil Register Law imposes a duty on the
"successful petitioner for divorce or annulment of marriage to send a copy of the final decree of the
court to the local registrar of the municipality where the dissolved or annulled marriage was
solemnized."17 Section 2 of Rule 108 provides that entries in the civil registry relating to "marriages,"
"judgments of annulments of marriage" and "judgments declaring marriages void from the beginning"
are subject to cancellation or correction.18 The petition in the RTC sought (among others) to annotate
the judgment of the Japanese Family Court on the certificate of marriage between Marinay and
Maekara.

Fujikis motion for reconsideration in the RTC also asserted that the trial court "gravely erred" when,
on its own, it dismissed the petition based on improper venue. Fujiki stated that the RTC may be
confusing the concept of venue with the concept of jurisdiction, because it is lack of jurisdiction
which allows a court to dismiss a case on its own. Fujiki cited Dacoycoy v. Intermediate Appellate
Court19 which held that the "trial court cannot pre-empt the defendants prerogative to object to the
improper laying of the venue by motu proprio dismissing the case."20Moreover, petitioner alleged that
the trial court should not have "immediately dismissed" the petition under Section 5 of A.M. No. 02-
11-10-SC because he substantially complied with the provision.

On 2 March 2011, the RTC resolved to deny petitioners motion for reconsideration. In its Resolution,
the RTC stated that A.M. No. 02-11-10-SC applies because the petitioner, in effect, prays for a
decree of absolute nullity of marriage.21 The trial court reiterated its two grounds for dismissal, i.e.
lack of personality to sue and improper venue under Sections 2(a) and 4 of A.M. No. 02-11-10-SC.
The RTC considered Fujiki as a "third person"22 in the proceeding because he "is not the husband in
the decree of divorce issued by the Japanese Family Court, which he now seeks to be judicially
recognized, x x x."23 On the other hand, the RTC did not explain its ground of impropriety of venue. It
only said that "[a]lthough the Court cited Sec. 4 (Venue) x x x as a ground for dismissal of this case[,]
it should be taken together with the other ground cited by the Court x x x which is Sec. 2(a) x x x." 24

The RTC further justified its motu proprio dismissal of the petition based on Braza v. The City Civil
Registrar of Himamaylan City, Negros Occidental.25 The Court in Braza ruled that "[i]n a special
proceeding for correction of entry under Rule 108 (Cancellation or Correction of Entries in the
Original Registry), the trial court has no jurisdiction to nullify marriages x x x." 26 Braza emphasized
that the "validity of marriages as well as legitimacy and filiation can be questioned only in a direct
action seasonably filed by the proper party, and not through a collateral attack such as [a] petition
[for correction of entry] x x x."27

The RTC considered the petition as a collateral attack on the validity of marriage between Marinay
and Maekara. The trial court held that this is a "jurisdictional ground" to dismiss the
petition.28 Moreover, the verification and certification against forum shopping of the petition was not
authenticated as required under Section 529 of A.M. No. 02-11-10-SC. Hence, this also warranted the
"immediate dismissal" of the petition under the same provision.

The Manifestation and Motion of the Office of the Solicitor General and the Letters of Marinay
and Maekara

On 30 May 2011, the Court required respondents to file their comment on the petition for
review.30 The public respondents, the Local Civil Registrar of Quezon City and the Administrator and
Civil Registrar General of the NSO, participated through the Office of the Solicitor General. Instead
of a comment, the Solicitor General filed a Manifestation and Motion. 31

The Solicitor General agreed with the petition. He prayed that the RTCs "pronouncement that the
petitioner failed to comply with x x x A.M. No. 02-11-10-SC x x x be set aside" and that the case be
reinstated in the trial court for further proceedings.32 The Solicitor General argued that Fujiki, as the
spouse of the first marriage, is an injured party who can sue to declare the bigamous marriage
between Marinay and Maekara void. The Solicitor General cited Juliano-Llave v. Republic33 which
held that Section 2(a) of A.M. No. 02-11-10-SC does not apply in cases of bigamy. In Juliano-Llave,
this Court explained:

[t]he subsequent spouse may only be expected to take action if he or she had only discovered
during the connubial period that the marriage was bigamous, and especially if the conjugal bliss had
already vanished. Should parties in a subsequent marriage benefit from the bigamous marriage, it
would not be expected that they would file an action to declare the marriage void and thus, in such
circumstance, the "injured spouse" who should be given a legal remedy is the one in a subsisting
previous marriage. The latter is clearly the aggrieved party as the bigamous marriage not only
threatens the financial and the property ownership aspect of the prior marriage but most of all, it
causes an emotional burden to the prior spouse. The subsequent marriage will always be a reminder
of the infidelity of the spouse and the disregard of the prior marriage which sanctity is protected by
the Constitution.34

The Solicitor General contended that the petition to recognize the Japanese Family Court judgment
may be made in a Rule 108 proceeding.35 In Corpuz v. Santo Tomas,36 this Court held that "[t]he
recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself, as the object
of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the
status or right of a party or a particular fact."37 While Corpuz concerned a foreign divorce decree, in
the present case the Japanese Family Court judgment also affected the civil status of the parties,
especially Marinay, who is a Filipino citizen.

The Solicitor General asserted that Rule 108 of the Rules of Court is the procedure to record "[a]cts,
events and judicial decrees concerning the civil status of persons" in the civil registry as required by
Article 407 of the Civil Code. In other words, "[t]he law requires the entry in the civil registry of
judicial decrees that produce legal consequences upon a persons legal capacity and status x x
x."38 The Japanese Family Court judgment directly bears on the civil status of a Filipino citizen and
should therefore be proven as a fact in a Rule 108 proceeding.

Moreover, the Solicitor General argued that there is no jurisdictional infirmity in assailing a void
marriage under Rule 108, citing De Castro v. De Castro39 and Nial v. Bayadog40 which declared that
"[t]he validity of a void marriage may be collaterally attacked." 41

Marinay and Maekara individually sent letters to the Court to comply with the directive for them to
comment on the petition.42 Maekara wrote that Marinay concealed from him the fact that she was
previously married to Fujiki.43Maekara also denied that he inflicted any form of violence on
Marinay.44 On the other hand, Marinay wrote that she had no reason to oppose the petition. 45 She
would like to maintain her silence for fear that anything she say might cause misunderstanding
between her and Fujiki.46

The Issues
Petitioner raises the following legal issues:

(1) Whether the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of
Voidable Marriages (A.M. No. 02-11-10-SC) is applicable.

(2) Whether a husband or wife of a prior marriage can file a petition to recognize a foreign
judgment nullifying the subsequent marriage between his or her spouse and a foreign citizen
on the ground of bigamy.

(3) Whether the Regional Trial Court can recognize the foreign judgment in a proceeding for
cancellation or correction of entries in the Civil Registry under Rule 108 of the Rules of
Court.

The Ruling of the Court

We grant the petition.

The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages
(A.M. No. 02-11-10-SC) does not apply in a petition to recognize a foreign judgment relating to the
status of a marriage where one of the parties is a citizen of a foreign country. Moreover, in Juliano-
Llave v. Republic,47 this Court held that the rule in A.M. No. 02-11-10-SC that only the husband or
wife can file a declaration of nullity or annulment of marriage "does not apply if the reason behind the
petition is bigamy."48

I.

For Philippine courts to recognize a foreign judgment relating to the status of a marriage where one
of the parties is a citizen of a foreign country, the petitioner only needs to prove the foreign judgment
as a fact under the Rules of Court. To be more specific, a copy of the foreign judgment may be
admitted in evidence and proven as a fact under Rule 132, Sections 24 and 25, in relation to Rule
39, Section 48(b) of the Rules of Court.49 Petitioner may prove the Japanese Family Court judgment
through (1) an official publication or (2) a certification or copy attested by the officer who has custody
of the judgment. If the office which has custody is in a foreign country such as Japan, the certification
may be made by the proper diplomatic or consular officer of the Philippine foreign service in Japan
and authenticated by the seal of office.50

To hold that A.M. No. 02-11-10-SC applies to a petition for recognition of foreign judgment would
mean that the trial court and the parties should follow its provisions, including the form and contents
of the petition,51 the service of summons,52 the investigation of the public prosecutor,53 the setting of
pre-trial,54 the trial55 and the judgment of the trial court.56 This is absurd because it will litigate the
case anew. It will defeat the purpose of recognizing foreign judgments, which is "to limit repetitive
litigation on claims and issues."57 The interpretation of the RTC is tantamount to relitigating the case
on the merits. In Mijares v. Raada,58 this Court explained that "[i]f every judgment of a foreign court
were reviewable on the merits, the plaintiff would be forced back on his/her original cause of action,
rendering immaterial the previously concluded litigation."59

A foreign judgment relating to the status of a marriage affects the civil status, condition and legal
capacity of its parties. However, the effect of a foreign judgment is not automatic. To extend the
effect of a foreign judgment in the Philippines, Philippine courts must determine if the foreign
judgment is consistent with domestic public policy and other mandatory laws. 60 Article 15 of the Civil
Code provides that "[l]aws relating to family rights and duties, or to the status, condition and legal
capacity of persons are binding upon citizens of the Philippines, even though living abroad." This is
the rule of lex nationalii in private international law. Thus, the Philippine State may require, for
effectivity in the Philippines, recognition by Philippine courts of a foreign judgment affecting its
citizen, over whom it exercises personal jurisdiction relating to the status, condition and legal
capacity of such citizen.

A petition to recognize a foreign judgment declaring a marriage void does not require relitigation
under a Philippine court of the case as if it were a new petition for declaration of nullity of marriage.
Philippine courts cannot presume to know the foreign laws under which the foreign judgment was
rendered. They cannot substitute their judgment on the status, condition and legal capacity of the
foreign citizen who is under the jurisdiction of another state. Thus, Philippine courts can only
recognize the foreign judgment as a fact according to the rules of evidence.

Section 48(b), Rule 39 of the Rules of Court provides that a foreign judgment or final order against a
person creates a "presumptive evidence of a right as between the parties and their successors in
interest by a subsequent title." Moreover, Section 48 of the Rules of Court states that "the judgment
or final order may be repelled by evidence of a want of jurisdiction, want of notice to the party,
collusion, fraud, or clear mistake of law or fact." Thus, Philippine courts exercise limited review on
foreign judgments. Courts are not allowed to delve into the merits of a foreign judgment. Once a
foreign judgment is admitted and proven in a Philippine court, it can only be repelled on grounds
external to its merits, i.e. , "want of jurisdiction, want of notice to the party, collusion, fraud, or clear
mistake of law or fact." The rule on limited review embodies the policy of efficiency and the
protection of party expectations,61 as well as respecting the jurisdiction of other states.62

Since 1922 in Adong v. Cheong Seng Gee,63 Philippine courts have recognized foreign divorce
decrees between a Filipino and a foreign citizen if they are successfully proven under the rules of
evidence.64 Divorce involves the dissolution of a marriage, but the recognition of a foreign divorce
decree does not involve the extended procedure under A.M. No. 02-11-10-SC or the rules of
ordinary trial. While the Philippines does not have a divorce law, Philippine courts may, however,
recognize a foreign divorce decree under the second paragraph of Article 26 of the Family Code, to
capacitate a Filipino citizen to remarry when his or her foreign spouse obtained a divorce decree
abroad.65

There is therefore no reason to disallow Fujiki to simply prove as a fact the Japanese Family Court
judgment nullifying the marriage between Marinay and Maekara on the ground of bigamy. While the
Philippines has no divorce law, the Japanese Family Court judgment is fully consistent with
Philippine public policy, as bigamous marriages are declared void from the beginning under Article
35(4) of the Family Code. Bigamy is a crime under Article 349 of the Revised Penal Code. Thus,
Fujiki can prove the existence of the Japanese Family Court judgment in accordance with Rule 132,
Sections 24 and 25, in relation to Rule 39, Section 48(b) of the Rules of Court.

II.

Since the recognition of a foreign judgment only requires proof of fact of the judgment, it may be
made in a special proceeding for cancellation or correction of entries in the civil registry under Rule
108 of the Rules of Court. Rule 1, Section 3 of the Rules of Court provides that "[a] special
proceeding is a remedy by which a party seeks to establish a status, a right, or a particular fact."
Rule 108 creates a remedy to rectify facts of a persons life which are recorded by the State
pursuant to the Civil Register Law or Act No. 3753. These are facts of public consequence such as
birth, death or marriage,66 which the State has an interest in recording. As noted by the Solicitor
General, in Corpuz v. Sto. Tomas this Court declared that "[t]he recognition of the foreign divorce
decree may be made in a Rule 108 proceeding itself, as the object of special proceedings (such as
that in Rule 108 of the Rules of Court) is precisely to establish the status or right of a party or a
particular fact."67

Rule 108, Section 1 of the Rules of Court states:

Sec. 1. Who may file petition. Any person interested in any act, event, order or
decree concerning the civil status of persons which has been recorded in the civil
register, may file a verified petition for the cancellation or correction of any entry relating thereto,
with the Regional Trial Court of the province where the corresponding civil registry is located.
(Emphasis supplied)

Fujiki has the personality to file a petition to recognize the Japanese Family Court judgment nullifying
the marriage between Marinay and Maekara on the ground of bigamy because the judgment
concerns his civil status as married to Marinay. For the same reason he has the personality to file a
petition under Rule 108 to cancel the entry of marriage between Marinay and Maekara in the civil
registry on the basis of the decree of the Japanese Family Court.

There is no doubt that the prior spouse has a personal and material interest in maintaining the
integrity of the marriage he contracted and the property relations arising from it. There is also no
doubt that he is interested in the cancellation of an entry of a bigamous marriage in the civil registry,
which compromises the public record of his marriage. The interest derives from the substantive right
of the spouse not only to preserve (or dissolve, in limited instances 68) his most intimate human
relation, but also to protect his property interests that arise by operation of law the moment he
contracts marriage.69 These property interests in marriage include the right to be supported "in
keeping with the financial capacity of the family"70 and preserving the property regime of the
marriage.71

Property rights are already substantive rights protected by the Constitution, 72 but a spouses right in a
marriage extends further to relational rights recognized under Title III ("Rights and Obligations
between Husband and Wife") of the Family Code. 73 A.M. No. 02-11-10-SC cannot "diminish,
increase, or modify" the substantive right of the spouse to maintain the integrity of his marriage. 74 In
any case, Section 2(a) of A.M. No. 02-11-10-SC preserves this substantive right by limiting the
personality to sue to the husband or the wife of the union recognized by law.

Section 2(a) of A.M. No. 02-11-10-SC does not preclude a spouse of a subsisting marriage to
question the validity of a subsequent marriage on the ground of bigamy. On the contrary, when
Section 2(a) states that "[a] petition for declaration of absolute nullity of void marriage may be
filed solely by the husband or the wife"75it refers to the husband or the wife of the subsisting
marriage. Under Article 35(4) of the Family Code, bigamous marriages are void from the beginning.
Thus, the parties in a bigamous marriage are neither the husband nor the wife under the law. The
husband or the wife of the prior subsisting marriage is the one who has the personality to file a
petition for declaration of absolute nullity of void marriage under Section 2(a) of A.M. No. 02-11-10-
SC.
Article 35(4) of the Family Code, which declares bigamous marriages void from the beginning, is the
civil aspect of Article 349 of the Revised Penal Code, 76 which penalizes bigamy. Bigamy is a public
crime. Thus, anyone can initiate prosecution for bigamy because any citizen has an interest in the
prosecution and prevention of crimes.77If anyone can file a criminal action which leads to the
declaration of nullity of a bigamous marriage,78 there is more reason to confer personality to sue on
the husband or the wife of a subsisting marriage. The prior spouse does not only share in the public
interest of prosecuting and preventing crimes, he is also personally interested in the purely civil
aspect of protecting his marriage.

When the right of the spouse to protect his marriage is violated, the spouse is clearly an injured party
and is therefore interested in the judgment of the suit. 79 Juliano-Llave ruled that the prior spouse "is
clearly the aggrieved party as the bigamous marriage not only threatens the financial and the
property ownership aspect of the prior marriage but most of all, it causes an emotional burden to the
prior spouse."80 Being a real party in interest, the prior spouse is entitled to sue in order to declare a
bigamous marriage void. For this purpose, he can petition a court to recognize a foreign judgment
nullifying the bigamous marriage and judicially declare as a fact that such judgment is effective in the
Philippines. Once established, there should be no more impediment to cancel the entry of the
bigamous marriage in the civil registry.

III.

In Braza v. The City Civil Registrar of Himamaylan City, Negros Occidental, this Court held that a
"trial court has no jurisdiction to nullify marriages" in a special proceeding for cancellation or
correction of entry under Rule 108 of the Rules of Court. 81 Thus, the "validity of marriage[] x x x can
be questioned only in a direct action" to nullify the marriage. 82 The RTC relied on Braza in dismissing
the petition for recognition of foreign judgment as a collateral attack on the marriage between
Marinay and Maekara.

Braza is not applicable because Braza does not involve a recognition of a foreign judgment nullifying
a bigamous marriage where one of the parties is a citizen of the foreign country.

To be sure, a petition for correction or cancellation of an entry in the civil registry cannot substitute
for an action to invalidate a marriage. A direct action is necessary to prevent circumvention of the
substantive and procedural safeguards of marriage under the Family Code, A.M. No. 02-11-10-SC
and other related laws. Among these safeguards are the requirement of proving the limited grounds
for the dissolution of marriage,83 support pendente lite of the spouses and children,84 the liquidation,
partition and distribution of the properties of the spouses,85 and the investigation of the public
prosecutor to determine collusion.86 A direct action for declaration of nullity or annulment of marriage
is also necessary to prevent circumvention of the jurisdiction of the Family Courts under the Family
Courts Act of 1997 (Republic Act No. 8369), as a petition for cancellation or correction of entries in
the civil registry may be filed in the Regional Trial Court "where the corresponding civil registry is
located."87 In other words, a Filipino citizen cannot dissolve his marriage by the mere expedient of
changing his entry of marriage in the civil registry.

However, this does not apply in a petition for correction or cancellation of a civil registry entry based
on the recognition of a foreign judgment annulling a marriage where one of the parties is a citizen of
the foreign country. There is neither circumvention of the substantive and procedural safeguards of
marriage under Philippine law, nor of the jurisdiction of Family Courts under R.A. No. 8369. A
recognition of a foreign judgment is not an action to nullify a marriage. It is an action for Philippine
courts to recognize the effectivity of a foreign judgment, which presupposes a case which was
already tried and decided under foreign law. The procedure in A.M. No. 02-11-10-SC does not
apply in a petition to recognize a foreign judgment annulling a bigamous marriage where one of the
parties is a citizen of the foreign country. Neither can R.A. No. 8369 define the jurisdiction of the
foreign court.

Article 26 of the Family Code confers jurisdiction on Philippine courts to extend the effect of a foreign
divorce decree to a Filipino spouse without undergoing trial to determine the validity of the
dissolution of the marriage. The second paragraph of Article 26 of the Family Code provides that
"[w]here a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino
spouse shall have capacity to remarry under Philippine law." In Republic v. Orbecido,88 this Court
recognized the legislative intent of the second paragraph of Article 26 which is "to avoid the absurd
situation where the Filipino spouse remains married to the alien spouse who, after obtaining a
divorce, is no longer married to the Filipino spouse" 89 under the laws of his or her country. The
second paragraph of Article 26 of the Family Code only authorizes Philippine courts to adopt the
effects of a foreign divorce decree precisely because the Philippines does not allow divorce.
Philippine courts cannot try the case on the merits because it is tantamount to trying a case for
divorce.

The second paragraph of Article 26 is only a corrective measure to address the anomaly that results
from a marriage between a Filipino, whose laws do not allow divorce, and a foreign citizen, whose
laws allow divorce. The anomaly consists in the Filipino spouse being tied to the marriage while the
foreign spouse is free to marry under the laws of his or her country. The correction is made by
extending in the Philippines the effect of the foreign divorce decree, which is already effective in the
country where it was rendered. The second paragraph of Article 26 of the Family Code is based on
this Courts decision in Van Dorn v. Romillo90 which declared that the Filipino spouse "should not be
discriminated against in her own country if the ends of justice are to be served." 91

The principle in Article 26 of the Family Code applies in a marriage between a Filipino and a foreign
citizen who obtains a foreign judgment nullifying the marriage on the ground of bigamy. The Filipino
spouse may file a petition abroad to declare the marriage void on the ground of bigamy. The
principle in the second paragraph of Article 26 of the Family Code applies because the foreign
spouse, after the foreign judgment nullifying the marriage, is capacitated to remarry under the laws
of his or her country. If the foreign judgment is not recognized in the Philippines, the Filipino spouse
will be discriminatedthe foreign spouse can remarry while the Filipino spouse cannot remarry.

Under the second paragraph of Article 26 of the Family Code, Philippine courts are empowered to
correct a situation where the Filipino spouse is still tied to the marriage while the foreign spouse is
free to marry. Moreover, notwithstanding Article 26 of the Family Code, Philippine courts already
have jurisdiction to extend the effect of a foreign judgment in the Philippines to the extent that the
foreign judgment does not contravene domestic public policy. A critical difference between the case
of a foreign divorce decree and a foreign judgment nullifying a bigamous marriage is that bigamy, as
a ground for the nullity of marriage, is fully consistent with Philippine public policy as expressed in
Article 35(4) of the Family Code and Article 349 of the Revised Penal Code. The Filipino spouse has
the option to undergo full trial by filing a petition for declaration of nullity of marriage under A.M. No.
02-11-10-SC, but this is not the only remedy available to him or her. Philippine courts have
jurisdiction to recognize a foreign judgment nullifying a bigamous marriage, without prejudice to a
criminal prosecution for bigamy.
In the recognition of foreign judgments, Philippine courts are incompetent to substitute their
judgment on how a case was decided under foreign law. They cannot decide on the "family rights
and duties, or on the status, condition and legal capacity" of the foreign citizen who is a party to the
foreign judgment. Thus, Philippine courts are limited to the question of whether to extend the effect
of a foreign judgment in the Philippines. In a foreign judgment relating to the status of a marriage
involving a citizen of a foreign country, Philippine courts only decide whether to extend its effect to
the Filipino party, under the rule of lex nationalii expressed in Article 15 of the Civil Code.

For this purpose, Philippine courts will only determine (1) whether the foreign judgment is
inconsistent with an overriding public policy in the Philippines; and (2) whether any alleging party is
able to prove an extrinsic ground to repel the foreign judgment, i.e. want of jurisdiction, want of
notice to the party, collusion, fraud, or clear mistake of law or fact. If there is neither inconsistency
with public policy nor adequate proof to repel the judgment, Philippine courts should, by default,
recognize the foreign judgment as part of the comity of nations. Section 48(b), Rule 39 of the Rules
of Court states that the foreign judgment is already "presumptive evidence of a right between the
parties." Upon recognition of the foreign judgment, this right becomes conclusive and the judgment
serves as the basis for the correction or cancellation of entry in the civil registry. The recognition of
the foreign judgment nullifying a bigamous marriage is a subsequent event that establishes a new
status, right and fact92 that needs to be reflected in the civil registry. Otherwise, there will be an
inconsistency between the recognition of the effectivity of the foreign judgment and the public
records in the Philippines.1wphi1

However, the recognition of a foreign judgment nullifying a bigamous marriage is without prejudice to
prosecution for bigamy under Article 349 of the Revised Penal Code.93 The recognition of a foreign
judgment nullifying a bigamous marriage is not a ground for extinction of criminal liability under
Articles 89 and 94 of the Revised Penal Code. Moreover, under Article 91 of the Revised Penal
Code, "[t]he term of prescription [of the crime of bigamy] shall not run when the offender is absent
from the Philippine archipelago."

Since A.M. No. 02-11-10-SC is inapplicable, the Court no longer sees the need to address the
questions on venue and the contents and form of the petition under Sections 4 and 5, respectively,
of A.M. No. 02-11-10-SC.

WHEREFORE, we GRANT the petition. The Order dated 31 January 2011 and the Resolution dated
2 March 2011 of the Regional Trial Court, Branch 107, Quezon City, in Civil Case No. Q-11-68582
are REVERSED and SET ASIDE. The Regional Trial Court is ORDERED to REINSTATE the petition
for further proceedings in accordance with this Decision.

SO ORDERED.