Rule 38
Province had no funds available to pay for the salaries of Governor Ong's 26 appointees. 9 She
G.R. No. 202331, April 22, 2015
THE PROVINCIAL GOVERNMENT OF AURORA, Petitioner, v. HILARIO M. MARCO, Respondents.
DECISION
LEONEN, J.:
The prohibition on midnight appointments only applies to presidential appointments. It does not
apply to appointments made by local chief executives.
Nevertheless, the Civil Service Commission has the power to promulgate rules and regulations to
professionalize the civil service. It may issue rules and regulations prohibiting local chief
executives from making appointments during the last days of their tenure. Appointments of local
chief executives must conform to these civil service rules and regulations in order to be valid.
This is a Petition for Review on Certiorari1 of the Court of Appeals Decision2 that denied the
appeal of the Provincial Government of Aurora (the Province). The Province appealed the
Resolution3 of the Civil Service Commission granting the Motion for Execution filed by Hilario M.
Marco (Marco). The Civil Service Commission had earlier reversed and set aside the disapproval
of Marco's permanent appointment as Cooperative Development Specialist II. 4
Governor Ramoncita P. Ong (Governor Ong) permanently appointed5 Marco as Cooperative
Development Specialist II on June 25, 2004, five (5) days before the end of her term as Governor
of the Province.6 On June 28, 2004, Marco's appointment, together with 25 other appointments,
was submitted to the Civil Service Commission Field Office-Aurora (the Field Office). Annexed to
Marco's appointment papers was a certification from Provincial Budget Officer Norma R.
Clemente (Provincial Budget Officer Clemente) and Provincial Accountant Wilfredo C. Saturno
(Provincial Accountant Saturno) stating that funds from the Province's 2004 Annual Budget were
available to cover the position.7
On June 30, 2004, newly elected Governor Bellaflor Angara-Castillo assumed office. The next day,
she called to an executive meeting all the department heads of the Province. 8
During the executive meeting, Provincial Budget Officer Clemente allegedly manifested that the
subsequently issued a Letter recalling the previously issued certification of the availability of
funds:chanroblesvirtuallawlibrary
In view of the result of the dialogue of the concerned offices regarding the financial status of the
Provincial Government of Aurora, we hereby recall/retrieve our previously issued certification
of availability of funds relative to the appointments issued by Governor Ramoncita P.
Ong.10cralawlawlibrary
Provincial Budget Officer Clemente's Letter was submitted to the Province's Human Resource
Management-Office. It was then forwarded to the Field Office.11
Due to the recall of the certification, the Field Office disapproved Marco's appointment in the
Letter12dated July 5, 2004.13
The Province, through Human Resource Management Officer Liwayway G. Victorio, served Marco
a copy of the Letter dated July 5, 2004. Marco was, thus, advised to refrain from reporting for
work beginning July 8, 2004, the day he received notice of the disapproval of his appointment. 14
Marco wrote the Civil Service Commission Regional Office No. IV (Regional Office), moving for
the reconsideration of the disapproval of his appointment.15 The Regional Office, however,
denied reconsideration in its Decision16 dated April 6, 2005 and affirmed the disapproval of
Marco's appointment. It said that "[t]he lack of funds for the [26 appointments Governor Ong
issued] was established during the meeting of the different department heads of Aurora Province
and their new governor."17
Through the Letter dated May 17, 2005, Marco appealed before the Civil Service
Commission.18 The Province, through its Human Resource Management Office, received a copy of
Marco's Letter on May 23, 2005.19 However, it failed to comment on the appeal within 10 days
from receipt as required by Section 73 of the Uniform Rules on Administrative Cases in the Civil
Service.20
In the Resolution21 dated April 14, 2008, the Civil Service Commission granted Marco's appeal
and set aside the Regional Office's Decision dated April 6, 2005. It ruled that Marco's
appointment was valid since it was accompanied by a certification of availability of funds. 22 As to
the Letter withdrawing the certification, the Civil Service Commission ruled that it did not affect
the validity of Marco's appointment because the Province "failed to submit documentary
evidence to support its claim [that it had no funds to pay for the services of Governor Ong's
appointees]."23
The Civil Service Commission added that the Province's withdrawal of the certification was
"unfair to Marco":24ChanRoblesVirtualawlibrary
It is unfair to Marco who applied for the said position believing in good faith that funds were
available, passed the screening conducted by the Personnel Selection Board (PSB) on February
12 & 13, 2004, was appointed on June 25, 2004 and was later told to stop reporting for work as
his appointment was disapproved by [the Civil Service Commission Field Office-Aurora] simply
because the provincial government under the new governor realized that it has no funds to pay
for his services.25cralawlawlibrary
Thus, the Civil Service Commission ordered the Regional Office to investigate whether Provincial
Budget Officer Clemente and Provincial Accountant Saturno were administratively liable for
certifying that funds were available to cover the positions filled by Governor Ong's appointees
but subsequently withdrawing this certification.26 It ordered the. Field Office to reflect the
Resolution in Marco's appointment papers and in his Service Record.27
The Province received a copy of the April 14, 2008 Resolution on May 21, 2008.28
On July 22, 2008, Provincial Administrator Alex N. Ocampo (Provincial Administrator Ocampo),
on behalf of the Province, filed before the Civil Service Commission a Petition for Relief 29 on the
ground of extrinsic fraud. According to him, the Civil Service Commission deprived the Province
of an opportunity to be heard when it failed to implead the Province as an indispensable
party.30 He reiterated that Marco's appointment was void since the Province had no funds to pay
for Marco's salaries.31
The Civil Service Commission denied outright the Petition for Relief in the Resolution32 dated
November 4, 2008. It ruled that Provincial Administrator Ocampo had no legal personality to file
the Petition for Relief absent an authorization from the Provincial Governor. Moreover, a petition
for relief was not allowed under the Uniform Rules on Administrative Cases in the Civil Service.
Thus, Provincial Administrator Ocampo erred in filing a Petition for Relief.33
Provincial Administrator Ocampo filed a Motion for Reconsideration,34 this time with a written
authority35to file from Governor Bellafior Angara-Castillo annexed to the Motion.36
The Civil Service Commission denied the Motion for Reconsideration in the Resolution37 dated
September 8, 2009. It ruled that its April 14, 2008 Resolution had become final and executory
considering that the Province did not file a motion for reconsideration of this Resolution within
the reglementary period.38
Consequently, Marco requested the Civil Service Commission to implement the April 14, 2008
Resolution.39 Through the Resolution40 dated July 6, 2010, the Commission granted Marco's
request.
Provincial Administrator Ocampo filed a Motion for Reconsideration with Motion to Quash
"Execution,"41arguing that the April 14, 2008 Resolution had already been implemented. As the
Civil Service Commission had ordered, the Province reflected the April 14, 2008 Resolution.in
Marco's appointment papers and in his Service Record.42
In the Resolution43 dated January 24, 2011, the Civil Service Commission denied the Motion for
Reconsideration with Motion to Quash "Execution." It noted that the Province still refused to
reinstate Marco despite the April 14, 2008 Resolution and thus clarified that this Resolution
necessarily resulted in the approval of Marco's appointment and his reinstatement as
Cooperative Development Specialist II.44The January 24, 2011 Resolution
states:chanroblesvirtuallawlibrary
Ocampo, et al. nonchalantly tries to sweep away what is obvious in the ruling of the Commission
in [the April 14, 2008 Resolution], i.e., the reversal of the disapproval by [the Regional Office] and
[the Field Office] of Marco's appointment. The reversal of the two (2) decisions mean[s] that
Marco's appointment as Cooperative Development Specialist II is in order and should be
approved. Consequently, the approval of Marco's appointment is legal proof that he is entitled to
perform the duties and functions of the said position and receive the salaries and benefits
attached to the position.cralawred
WHEREFORE, the Motion for Reconsideration with Motion to Quash of Alex N. Ocampo,
Provincial Administrator, and Manuel Joseph R. Bretana III, Legal Counsel, Provincial
Government of Aurora, is DENIED. Accordingly, [the July 6, 2010 Resolution] which grants the
Motion for the Implementation of [the April 14, 2008 Resolution] filed by Hilario M.
Marco, STANDS.
The Provincial Governor of Aurora is directed to reinstate Marco to his Cooperative Development
Specialist II position and pay his back salaries and other benefits from the time that Marco was
actually prohibited from reporting for work up to his actual reinstatement.45cralawlawlibrary
A Petition for Review46 under Rule 43 with prayer for issuance of a temporary restraining
order47 was filed before the Court of Appeals. For the first time, the Province argued that Marco
was a midnight appointee since Governor Ong appointed him during the last five (5) days of her
tenure. Therefore, Marco's appointment was void.48
In the Decision dated March 2, 2012, the Court of Appeals denied the Petition for Review and
affirmed the implementation of the Civil Service Commission's April 14, 2008 Resolution.49
The Court of Appeals ruled that the April 14, 2008 Resolution already became final and
executory since there was no motion for reconsideration filed within the reglementary period.
Although the Province filed a Petition for Relief before the Civil Service Commission, the Court of
Appeals held that the remedy of a petition for relief is not allowed under the Uniform Rules on
Administrative Cases in the Civil Service. Moreover, the Province failed to prove the extrinsic
fraud that allegedly prevented it from filing a motion for reconsideration. Thus, the Civil Service
Commission correctly denied the Petition for Relief.50
On the merits, the Court of Appeals affirmed Marco's appointment. The Province had earlier
certified that it had funds to pay for his salary as Cooperative Development Specialist II. 51 It
found that the Sangguniang Panlalawigan even passed a "Supplemental Budget for 2004
appropriating P54,014,127.01 in provincial funds."52 Therefore, the issuance of the Letter
recalling the certification "[did] not change the fact that there [were] funds available for
[Marco's] appointment."53
On the claim that Marco was a midnight appointee, the Court of Appeals said that Marco's case
fell within the exception provided under Civil Service Commission Resolution No. 030918. 54 He
was fully qualified for the position and underwent a screening process on February 12 and 13,
2004, long before the election ban.55 Therefore, he was validly appointed.
The Province filed a Motion for Reconsideration,56 which the Court of Appeals denied in the
Resolution57dated June 13, 2012.
The Province filed a Petition for Review on Certiorari before this court. Marco filed his
Comment,58 after which the Province filed its Reply.59
In the Resolution60 dated January 30, 2013, this court ordered the parties to file their respective
memoranda. The Province filed its Memorandum61 on April 25, 2013, while Marco filed his
Memorandum62 on May 2, 2013.
The Province maintains that Marco's appointment was void on the ground that he was a
midnight appointee. Marco was appointed by Governor Ong five (5) days before the end of her
term, in violation of Civil Service Commission Resolution No. 030918,63 paragraph 2.1 of which
provides:chanroblesvirtuallawlibrary
2.1. All appointments issued by elective appointing officials after elections up to June 30 shall be
disapproved, except if the appointee is fully qualified for the position and had undergone
regular screening processes before the Election Ban as shown in the Promotion and
Selection Board (PSB) report or minutes of meeting.
On Marco's claim that he underwent a regular screening process, which exempted his
appointment from the prohibition on midnight appointments, the Province counters that Marco
failed to present convincing evidence to prove this claim. The Minutes of the Meeting of the
Promotion Selection Board showed that Marco was among the 201 applicants allegedly screened
by the Board within two (2j days. According to the Province, two days is a period too short for
the Personnel Selection Board to have carefully considered all the applications.64
As to the claim that the April 14, 2008 Resolution is final and executory and may no longer be
reversed, the Province argues that nothing prevents this court from setting aside this Resolution.
It argues that the promulgation of Nazareno, et al. v. City of Dumaguete65 was a supervening event
warranting the reversal of the final and executory decision.66
In Nazareno, this court voided 89 appointments made by a city mayor within the month that he
left office, ruling that they were mass appointments prohibited under Civil Service Commission
Resolution No. 010988.67 The Province argues that Governor Ong's appointments were
analogous to the Nazarenoappointments; hence, Governor Ong's appointments should likewise
be voided.68
Finally, the Province insists that Marco's appointment was void due to lack of funds to pay for the
position.69 In ordering the Province to uphold Marco's appointment despite the lack of funds, the
Civil Service Commission allegedly "interfered with [the Province's] prerogative to draw up its
own budget and to spend its ... revenues as it deems fit." 70
For his part, Marco maintains that the Civil Service Commission's Resolution dated April 14,
2008 has long become final and executory. Therefore, the Resolution may no longer be
disturbed.71
On the claim that he was a midnight appointee, Marco pointed out that the Province belatedly
raised this claim. The Province never raised it before the Civil Service Commission but only did
so before the Court of Appeals.72 By belatedly raising this claim, the Province should be deemed
to have "implicitly recognized"73 that he was not a midnight appointee.
In any case, Marco asserts that he was qualified for the position and that he underwent a
selection process as required by Resolution No. 030918. Thus, his appointment was an exception
to the prohibition on midnight appointments.74
On the alleged interference of the Civil Service Commission with the Province's discretionary
power to appoint, Marco argues that it "merely upheld the validity of an existing
appointment[.]"75 The Civil Service Commission did not "[substitute] its own appointee for the
one chosen by the appointing authority."76 Therefore, it correctly upheld his appointment.
Lastly, Marco argues that Nazareno does not apply in this case. This court in Nazareno voided the
89 appointments of the appointing authority based on the criteria set in Resolution No.
010988.77 However, Nazareno had been promulgated even before he was appointed in office.
Moreover, Resolution No. 010988 did not set any new criteria for appointments made during the
last days of the appointing authority in office. Therefore, the promulgation of Nazareno is not a
supervening event that can set aside the final and executory April 14, 2008 Resolution.78
The issues for this court's resolution are:
First, whether the Resolution dated July 6, 2010, which ordered the implementation of the April
14, 2008 Resolution, was void for varying the terms of the April 14, 2008 Resolution;
Second, whether the withdrawal of the certification of sufficiency of funds voided Marco's
appointment; and
Lastly, whether Marco's appointment was void on the ground that he was a midnight appointee.
This Petition must be denied.cralawlawlibrary
I Unknown to Mendiola, the Economic Intelligence and Investigation Bureau belatedly filed a
We note that the Province filed an appeal before the Court of Appeals against the Civil Service
Commission's Resolution that ordered the execution of the April 14, 2008 Resolution. 79
The Province erred in filing an appeal before the Court of Appeals, as no appeal may be taken
from an order of execution.80 Instead, it should have filed a petition for certiorari the
appropriate special civil action under Rule 65 of the Rules of Court.81
The Court of Appeals, therefore, should have dismissed the Province's appeal outright. Rule 50,
Section 1(i) of the Rules of Court allows the Court of Appeals to dismiss an appeal where the
order appealed from is not appealable.82
The rule prohibiting appeals from orders of execution is based on the doctrine of immutability of
final judgments. Under this doctrine, a final and executory judgment "is removed from the power
and jurisdiction of the court which rendered it to further alter or amend it, much less revoke
it."83 The judgment remains immutable even if it is later on discovered to be erroneous.84 The
doctrine "is grounded on fundamental considerations of public policy and sound practice that at
the risk of occasional error, the judgments of the courts must become final at some definite date
fixed by law. To allow courts to amend final [and executory] judgments will result in endless
litigation."85
The doctrine of immutability of final judgments applies to decisions rendered by the Civil Service
Commission. A decision of the Civil Service Commission becomes final and executory if no
motion for reconsideration is filed within the 15-day reglementary period under Rule VI, Section
80 of the Uniform Rules on Administrative Cases in the Civil Service:chanroblesvirtuallawlibrary
Section 80. Execution of Decision. - The decisions of the Commission Proper or its Regional Offices
shall be immediately executory after fifteen (15) days from receipt thereof, unless a motion for
reconsideration is seasonably filed, in which case the execution of the decision shall be held in
abeyance.
In Mendiola v. Civil Service Commission,86 Teodorico Mendiola (Mendiola) occupied the position of
Budget Examiner III when the Economic Intelligence and Investigation Bureau terminated his
employment.87 On Mendiola's appeal, the Civil Service Commission ordered his reinstatetment in
the resolution dated September 21, 1988.88
The Economic Intelligence and Investigation Bureau failed to file a motion for reconsideration
within the 15-day reglementary period. Consequently, Mendiola filed a motion for execution of
the September 21, 1988 resolution.89
motion for reconsideration, which the Civil Service Commission granted despite having been
filed out of time.90
This court reversed the Civil Service Commission's grant of the motion for reconsideration and
ordered Mendiola's reinstatement as the Commission previously ordered in the September 21,
1998 resolution. This court held that the September 21, 1998 resolution had become final and
executory when the Economic Intelligence and Investigation Bureau failed to file a motion for
reconsideration within the reglementary period. Thus, the Civil Service Commission may no
longer reverse the resolution.91
In Obiasca v. Basallote,92 Jeane O. Basallote (Basallote) was appointed Administrative Officer II by
the Department of Education and was assigned to work in Tabaco National High School in Albay.
Basallote had assumed the duties of her office as Administrative Officer II when she learned that
Arlin B. Obiasca (Obiasca) was subsequently appointed to the same position. Obiasca's
appointment was attested to by the Civil Service Commission, while Basallote's appointment
papers were not even forwarded to the Civil Service Commission.93
Basallote protested Obiasca's appointment before the Civil Service Commission Regional Office
V. The Regional Office dismissed the protest. On appeal, the Civil Service Commission reversed
the Regional Office's Decision, thus approving Basallote's appointment and recalling that of
Obiasca.94
Without filing a motion for reconsideration before the Civil Service Commission, Obiasca directly
filed an appeal before the Court of Appeals. The Court of Appeals affirmed the Civil Service
Commission's Decision.95
Obiasca's Petition for Review on certiorari was likewise denied by this court.96 This court held
that Obiasca's failure to file a motion for reconsideration rendered the Civil Service
Commission's Decision approving Basallote's appointment final and executory. Thus, the Civil
Service Commission's Decision may no longer be disturbed:97ChanRoblesVirtualawlibrary
[Obiasca] did not file a petition for reconsideration of the [Civil Service Commission's resolution]
before filing a petition for review in the [Court of Appeals]. Such fatal procedural lapse on
[Obiasca]'s part allowed the [Civil Service Commission's resolution] to become final and
executory. Hence, for all intents and purposes, the [Civil Service Commission's resolution] has
become immutable and can no longer be amended or modified. A final and definitive judgment
can no longer be changed, revised, amended or reversed. Thus, in praying for the reversal of
the assailed Court of Appeals decision which affirmed the final and executory [Civil Service
Commission resolution], [Obiasca] would want the Court to reverse a final and executory
judgment and disregard the doctrine of immutability of final judgments.98 (Emphasis in the
original, citations omitted)
In this case, the Province, through its Human Resource Management Office, received a copy of the
Civil Service Commission's April 14, 2008 Resolution on May 21, 2008.99 Thus, the Province had
until June 5, 2008 to file a motion for reconsideration.
However, the Province failed to file a motion for reconsideration of the April 14, 2008 Resolution
within the 15-day reglementary period. With no motion for reconsideration seasonably filed, the
April 14, 2008 Resolution-became final and executory on June 6, 2008.
In addition, the remedy of a petition for relief from judgment is not among those provided under
the Uniform Rules on Administrative Cases in the Civil Service. This means that the remedy is not
allowed under civil service rules.100 Even assuming that a petition for relief may be filed before
the Civil Service Commission, the party must show that the assailed judgment became final
through fraud, accident, mistake, or excusable negligence. 101
Here, the Province failed to refute that it received a copy of the Civil Service Commission's April
14, 2008 Resolution. It was given an opportunity to be heard, which is the essence of
administrative due process.103 It did not even justify why it failed to file a motion for
reconsideration despite its receipt of the Civil Service Commission's Resolution. Contrary to the
Province's claim, there was no extrinsic fraud since the Province was not prevented "from fully
and fairly presenting [its] defense[.]"104 The Civil Service Commission correctly denied the
Province's Petition for Relief.
Since the April 14, 2008 Resolution already became final and executory, it may no longer be
reversed. The Civil Service Commission correctly granted Marco's request for the Resolution's
implementation.cralawlawlibrary
II
In implementing the April 14, 2008 Resolution, the Civil Service Commission ordered the
Province to reinstate Marco and to pay him back salaries and other
benefits:chanroblesvirtuallawlibrary
WHEREFORE, the request of Hilario M. Marco, Cooperative Development Specialist II, Provincial
Government of Aurora, for the implementation of CSC Resolution No. 08-0656 dated April 14,
2008 is GRANTED. Accordingly, the Provincial Government of Aurora is directed to reinstate
Marco to his former position and the payment of his back salaries and other benefits starting
from the date he was advised to stop reporting for work on July 8, 2004 up to his actual
reinstatement.105cralawlawlibrary
According to the Province, the Civil Service Commission went beyond the order sought to be
implemented and "varie[d] the term of the judgment."106 The Province claims that nothing in the
April 14, 2008 Resolution ordered the reinstatement of Marco. The dispositive portion of the
resolution stated:107ChanRoblesVirtualawlibrary
WHEREFORE, the appeal of Hilario M. Marco is GRANTED. Accordingly, the Decision No. 05-
0212 dated April 6, 2005 of the Civil Service Commission Regional Office IV, Quezon City,
affirming the disapproval of the appointment of Marco for lack of certification of availability of
funds is REVERSED and SET ASIDE.
The Civil Service Commission Field Office-Aurora is directed to reflect this decision in the
appointment of Marco and in his Service Record.108cralawlawlibrary
Therefore, the Province claims that the order implementing the April 14, 2008 Resolution must
be set aside.
We rule that the Civil Service Commission did not vary the terms of the April 14, 2008
Resolution.
Under Rule IV, Section 1 of Civil Service Commission Memorandum Circular No. 40-98, an
appointment takes effect immediately upon issuance by the appointing authority. Once the
appointee has assumed the duties of the position, he or she is entitled to receive the salaries
corresponding with the position though the Civil Service Commission has not yet approved the
appointment.
Should the appointment be initially disapproved, it nevertheless remains effective if a motion for
reconsideration or an appeal of the disapproval is seasonably filed with the proper
office.109 Therefore, during the pendency of the motion for reconsideration, the appointee
remains entitled to his or her salaries until the appointment is finally disapproved by the Civil
Service Commission.110
Marco's appointment immediately took effect on June 25, 2004 when Governor Ong appointed
him as Cooperative Development Specialist II. Although his appointment was initially
disapproved by the Field Office, Marco seasonably filed a Motion for Reconsideration before the
Civil Service Commission. Thus, Marco's appointment remained effective during the pendency of
the Motion for Reconsideration.
Because the Civil Service Commission granted his Motion for Reconsideration and set aside the
disapproval of his appointment, Marco remained entitled to his position. The necessary
consequence of granting reconsideration is his reinstatement as Cooperative Development
Specialist II.
The Civil Service Commission correctly implemented the April 14, 2008 Resolution by ordering
Marco's reinstatement and the payment of his back salaries and other benefits.cralawlawlibrary
III
The Province contends that the Civil Service Commission erred in approving Marco's
appointment as Cooperative Development Specialist II. It allegedly had no funds to cover the
position. Therefore, the appointment was void, having been issued in violation of Rule V, Section
1(e)(ii) of the Civil Service Commission Memorandum Circular No. 40-98. The rule
states:chanroblesvirtuallawlibrary
SECTION 1. In addition to the common requirements and procedures, the following
requirements and guidelines shall also be observed and the necessary documents submitted,
when applicable.
....
e. LGU Appointment. Appointment in local government units for submission to the
Commission shall be accompanied, in addition to the common requirements, by the
following
....
ii. Certification by the Municipal/City/Provincial Accountant/Budget Officer that funds are
available.
The certification ensures that the appointee shall occupy a position adequately covered by
appropriations as required by Section 325(e) of the Local Government
Code:chanroblesvirtuallawlibrary
SECTION 325. General Limitations. - The use of the provincial, city, and municipal funds shall be
subject to the following limitations:
....
(e) Positions in the official plantilla for career positions which are occupied by incumbents
holding permanent appointments shall be covered by adequate appropriations[.]
As required by Rule V, Section 1 (e)(ii) of the Civil Service Commission Memorandum Circular
No. 40-98, Marco's appointment was accompanied by a certification from the Province, through
the Provincial Budget Officer and the Provincial Accountant, that funds were available under the
2004 Annual Budget of the Province for the 26 positions issued by Governor Ong. Therefore,
there was no violation of Rule V, Section 1(e)(ii) of the Civil Service Commission Memorandum
Circular No. 40-98. There was no violation of existing Civil Service Law, rules and regulations.
Marco's appointment remains effective.
That the Province suddenly had no funds to pay for Marco's salaries despite its earlier
certification that funds were available under its 2004 Annual Budget does not affect his
appointment.
None of the grounds for disapproval, of an appointment under Rule V, Section 7111 of the
Omnibus Rules Implementing the Civil Service Law exists in this case. The appointment remains
effective, and the local government unit remains liable for the salaries of the appointee. 112
Moreover, the earlier certification, if proven false, constitutes intentional misrepresentation of a
material fact concerning a civil service matter. This is an offense punishable by fine, or
imprisonment, or both as provided under Section 67 of the Civil Service
Law:chanroblesvirtuallawlibrary
SEC. 67. Penal Provision. Whoever makes any appointment or employs any person in violation
of any provision of this Title or the rules made thereunder or whoever commits fraud, deceit or
intentional misrepresentation of material facts concerning other civil service matters, or
whoever violates, refuses or neglects to comply with any of such provisions or rules, shall upon
conviction be punished by a fine not exceeding one thousand pesos or by imprisonment not
exceeding six (6) months, or both such fine and imprisonment in the discretion of the court.
We, therefore, agree with the Civil Service Commission in ordering the Regional Office to
commence appropriate administrative proceedings against Provincial Budget Officer Norma R.
Clemente and Provincial Accountant Wilfredo C. Saturno for issuing the certification of
availability of funds:chanroblesvirtuallawlibrary
The Commission disapproves of the conduct of the officials of the Provincial Government of
Aurora in issuing a certification dated June 25, 2004 that funds are available in the 2004 Annual
Budget to support the appointments issued by outgoing Governor Ong and then later
[withdrawing] the same when a new governor assumes office. As such, the CSCRO No. IV is
directed to conduct the appropriate administrative proceedings to determine whether Norma R.
Clemente (Provincial Budget Officer) and Wilfredo C. Saturno (Provincial Accountant) violated
Civil Service Law, rules and regulations.113cralawlawlibrary
IV
The Province claims that Marco was a midnight appointee. Moreover, he was among those
appointed "en masse"114 by Governor Ong before the end of her term. Thus, the Civil Service
Commission should have disapproved Marco's appointment.
A midnight appointment "refers to those appointments made within two months immediately
prior to the next presidential election."115 Midnight appointments are prohibited under Article
VII, Section 15 of the Constitution:chanroblesvirtuallawlibrary
SECTION 15. Two months immediately before the next presidential elections and up to the end of
his term, a President or Acting President shall not make appointments, except temporary
appointments to executive positions when continued vacancies therein will prejudice public
service or endanger public safety.
Midnight appointments are prohibited because an outgoing President is "duty bound to prepare
for the orderly transfer of authority to the incoming President, and he [or she] should not do acts
which he [or she] ought to know, would embarrass or obstruct the policies of his [or her]
successor."116 An outgoing President should not "deprive the new administration of an
opportunity to make the corresponding appointments."117
However, the constitutiona prohibition on midnight appointments only applies to presidential
appointments. It does not apply to appointments made by local chief executives.
In De Rama v. Court of Appeals,118 Mayor Conrado L. de Rama (Mayor de Rama) of Pagbilao,
Quezon sought to recall 14 appointments made by former Mayor Ma. Evelyn S. Abeja on the sole
ground that they were midnight appointments.119 The Civil Service Commission denied Mayor de
Rama's request, ruling that the prohibition on midnight appointments only applies to outgoing
Presidents.120 On appeal, the Court of Appeals affirmed the Civil Service Commission's
decision.121
This court agreed with the Civil Service Commission and the Court of Appeals. In denying Mayor
de Rama's petition for review on certiorari, this court said that the prohibition on midnight
appointments "applies only to presidential appointments."122 This court noted that "there is no
law that prohibits local elective officials from making appointments during the last days of his or
her tenure."123
Nonetheless, the Civil Service Commission, as the central personnel agency of the
Government,124 may "establish rules and regulations to promote efficiency and professionalism
in the civil service."125Although it conceded that no law prohibits local elective officials from
making appointments during the last days of their tenure, this court in Nazareno upheld Civil
Service Commission Resolution No. 010988, which prohibited local elective officials from making
appointments immediately before and after elections.126 In addition, Resolution No. 010988
prohibited "mass appointments," or those "issued in bulk or in large number after the elections
by an outgoing local chief executive and there is no apparent need for their immediate issuance."
Resolution No. 010988 states:chanroblesvirtuallawlibrary
WHEREAS, the May 14, 2001 national and local elections have just concluded and the
Commission anticipates controversies that would arise involving appointments issued by
outgoing local chief executives immediately before and after elections;
WHEREAS, the Commission observed the tendency of some outgoing local chief executives to
issue appointments even after the elections, especially when their successors have already been
proclaimed;
WHEREAS, this practice of some outgoing local chief executives causes animosities between the
outgoing and incoming officials and the people who are immediately affected and made to suffer
the consequences thereof are the ordinary civil servants and eventually, to a larger extent, their
constituents themselves;
WHEREAS, one of the reasons behind the prohibition in issuing appointments or hiring of new
employees during the prohibited period as provided for in CSC Memorandum Circular No. 7,
series of 2001 is to prevent the occurrence of the foregoing, among others;
WHEREAS, local elective officials, whose terms of office are about to expire, are deemed as
"caretaker" administrators who are duty bound to prepare for the smooth and orderly transfer
of power and authority to the incoming local chief executives;

WHEREAS, under Section 15, Article VII of the Constitution, the President or Acting President is
prohibited from making appointments two (2) months immediately before the next presidential
elections and up to the end of his term, except temporary appointments to executive positions
when continued vacancies therein will prejudice public service or endanger public safety;
WHEREAS, while there is no equivalent provision in the Local Government Code of 1991
(Republic Act No. 7160) or in the Civil Service Law (Book V of Executive Order No. 292) of the
above-stated prohibition, the rationale against the prohibition on the issuance of "midnight
appointments" by the President is applicable to appointments extended by outgoing local chief
executives immediately before and/or after the elections; and
WHEREAS, the Commission also deems it fit to issue guidelines that would assist processors in
their actions on appointments issued by theses outgoing local chief executives immediately
before and/or after the elections;
NOW THEREFORE, the Commission, pursuant to its constitutional mandate as the central
personnel agency of the government, hereby issues and adopts the following guidelines:
1. The validity of an appointment issued immediately before or after the elections by
outgoing local chief executives is to be determined on the basis of the nature, character
and merit of the individual appointment and the particular circumstances surrounding
the same.
....
3. All appointments, whether original, transfer, reemployment, reappointment, promotion
or demotion, except in cases of renewal and reinstatement, regardless of status, which
are issued AFTER the elections, regardless of their dates of effectivity and/or date of
receipt by the Commission, including its Regional or Field Offices, of said appointments
or the Report of Personnel Actions (ROPA), as the case may be, shall be disapproved
unless the following requisites concur relative to their issuance:
a) The appointment has gone through the regular screening by the Personnel Selection Board
(PSB) before the prohibited period on the issuance of appointments as shown by the PSB
report or minutes of its meeting;
b) That the appointee is qualified;
c) There is a need to fill up the vacancy immediately in order not to prejudice public service
and/or endanger public safety;
d) That the appointment is not one of those mass appointments issued after the elections.
4. The term "mass appointments" refers to those issued in bulk or in large number after
the elections by an outgoing local chief executive and there is no apparent need for their
immediate issuance.
This court said that the rationale behind Resolution No. 010988 "is not difficult to
see":127ChanRoblesVirtualawlibrary
Appointments are banned prior to the elections to ensure that partisan loyalties will not be a
factor in the appointment process, and to prevent incumbents from gaining any undue advantage
during the elections. To this end, appointments within a certain period of time are proscribed by
the Omnibus Election Code and related issuances. After the elections, appointments by defeated
candidates are prohibited, except under the circumstances mentioned in CSC Resolution No.
010988, to avoid animosities between outgoing and incoming officials, to allow the incoming
administration a free hand in implementing its policies, and to ensure that appointments and
promotions are not used as a tool for political patronage or as a reward for services rendered to
the outgoing local officials.128(Citation omitted)
In Nazareno, this court affirmed the disapproval of 89 appointments Mayor Felipe Antonio B.
Remollo (Mayor Remollo) of Dumaguete City made within the month that he left office. This
court found that the appointments were issued in violation of Resolution No. 010988.
Particularly, it found no evidence that the Personnel Selection Board carefully deliberated on the
qualifications of Mayor Remollo's appointees.129 Moreover, the timing and the large number of
appointments "indicate that the appointments were hurriedly issued by the outgoing
administration."130
The Province argues that the 26 appointments Governor Ong issued during the last days of her
tenure were similar to those Mayor Remollo issued in Nazareno. Governor Ong allegedly issued
mass appointments, the immediate issuance of which the Province had no apparent need.
We note, however, that Resolution No. 010988 the Resolution effective when Mayor Remollo
issued the appointments in Nazareno was superseded by Resolution No. 030918 dated August
28, 2003.131Resolution No. 030918 on "midnight appointments" by local chief executives was
effective at the time Governor Ong issued the disputed appointments. Resolution No. 030918
states, in part:chanroblesvirtuallawlibrary
WHEREAS, under Section 3, Article IX-B of the 1987 Constitution, the Commission, as the central
personnel agency of the Government, is mandated to establish a career service and adopt
measures to promote efficiency, integrity, responsiveness, progressiveness and courtesy in the
civil service, among others;
WHEREAS, the Constitution further mandates the Commission to issue its own rules and
regulations for effective and efficient personnel administration in the Civil Service;
WHEREAS, Section 12(1) and (2), Book V of the Executive Order No. 292 (Administrative Code of
1987) mandates the Commission to administer and enforce the constitutional and statutory
provisions on the merit system for all ranks and levels in the Civil Service and to prescribe,
amend and enforce rules and regulations for carrying into effect the provision of the Civil Service
Law and other pertinent laws;
WHEREAS, problems and controversies inevitably arise involving appointments issued by
outgoing elective and appointive officials just before and after election periods;
WHEREAS, personnel morale, office operations, and delivery of public services are inevitably
disrupted by such problem's and controversies;
WHEREAS, there is a need to forestall such problems by defining and making more stringent the
restrictions on personnel appointments to be observed by outgoing appointing officials, elective
or appointive, before they leave office;
NOW, THEREFORE, the Commission, pursuant to its constitutional and statutory mandates as
the central personnel agency of the government, hereby issues and adopts the following
guidelines:
....
2. Action on Appointments issued by Elective and Appointive Officials After the Elections
Up to June 30
2.1. All appointments issued by elective appointing officials after elections up to June 30 shall be
disapproved, except if the appointee is fully qualified for the position and had undergone
regular screening processes before the Election Ban as shown in the Promotion and
Selection Board (PSB) report or minutes of meeting.
....
This Resolution supersedes CSC Resolution No. 010988 dated 4 June 2001 and shall take effect
fifteen (15) days after its publication in a newspaper of general circulation.
Quezon City, August 28, 2003.
Since Resolution No. 030918 was effective at the time Governor Ong issued the 26 appointments,
we must decide this case based on Resolution No. 030918. Nazareno is not applicable, as it was
decided based on Resolution No. 0109888.
We agree with the Civil Service Commission and the Court of Appeals that Governor Ong issued
Marco's appointment in accordance with Resolution No. 030918. Although his appointment was
made five (5) days before the end of Governor Ong's term, Marco was fully qualified for the
position and had undergone regular screening processes before the election ban. As the Civil
Service Commission found, Marco "applied for the [position of Cooperative Development
Specialist II] [and] passed the screening conducted by the Personnel Selection Board (PSB) on
February 12 & 13, 2004[.]"132 The Court of Appeals reiterated this finding in its Decision dated
March 2, 2012.133 Absent a showing of grave abuse of discretion, this court will not disturb the
findings of fact of the Civil Service Commission,134 especially since it has acquired "specialized
knowledge and expertise"135 in the field of civil service law.
Assuming without conceding that Governor Ong's 26 appointments were issued in bulk, this per
se does not invalidate the appointments. Unlike Resolution No. 010988, Resolution No. 030918
does not prohibit appointments that are large in number. Moreover, 26 appointments can hardly
be classified as "mass appointments," compared with the 89 appointments this court invalidated
in Nazareno.
Marco's appointment was valid. The Civil Service Commission correctly approved his
appointment.
Considering that Marco had already accepted his appointment by the time the Province
prevented him from assuming his office, his appointment remains effective up to the
present.136 Consequently, the Civil Service Commission correctly ordered the Province to
reinstate Marco as Cooperative Development Specialist II and to pay him his back salaries from
July 8, 2004 when the Province prevented him from reporting for work up to his actual
reinstatement.cralawred
WHEREFORE, the Petition for Review on Certiorari is DENIED. The Court of Appeals Decision
dated March 2, 2012 is affirmed.
SO ORDERED.chanroblesvirtuallawlibrary

THIRD DIVISION
G.R. No. 203642, January 18, 2016
THOMASITES CENTER FOR INTERNATIONAL STUDIES (TCIS), Petitioner, v. RUTH N.
RODRIGUEZ, IRENE P. PADRIGON AND ARLYN B. RILLERA, Respondents.
DECISION
REYES, J.:
This is a petition for review1 from the Resolution2 dated May 24, 2012 of the Court of Appeals
(CA) in CA-G.R. SP No. 124630, dismissing outright the Thomasites Center for International
Studies' (TCIS) petition for certiorari3 from the Decision4 dated September 30, 2011 of the
National Labor Relations Commission (NLRC) in NLRC Case No. RAB-III-01-8376-05, filed by
Ruth N. Rodriguez (Rodriguez) and Arlyn B. Rillera (Rillera), and in NLRC Case No. RAB-III-01-
8401-05, filed by Irene P. Padrigon (Padrigon) (respondents).chanRoblesvirtualLawlibrary
The Facts
On July 29, 2004, Rodriguez, 34, Rillera, 36, and Padrigon, 30, all graduates of the University of
the Philippines and holders of teaching licenses from the Professional Regulation Commission,
were hired by Dr. Jae Won Park and Dr. Cheol Je Cho (Dr. Cho), Korean nationals and President
and Academic Dean, respectively, of TC1S, to develop the academic programs of the said school,
design its curricula, create materials for the school website, recruit American and Filipino staff,
draft documents required for the school's Technical Education and Skills Development Authority
accreditation, help supervise the construction of the school building in Subic Bay Metropolitan
Authority, as well as draft the school's rules and regulations and student and faculty handbooks.
The parties executed no written contracts but the respondents were promised a monthly salary
of P25,000.00 plus shares of stock.5chanroblesvirtuallawlibrary
As soon after classes opened on December 20, 2004 at the Crown Peak Hotel in Subic Bay,
disagreements arose between the respondents and the American teachers on the question of
salaries. At the meeting called by Dr. Cho on January 7, 2005, the American teachers threatened
to resign unless the respondents were terminated. That same afternoon, the respondents were
served with letters of termination6 effective January 8, 2005, signed by Dr. Cho, citing as reason
the restructuring of the company and consequent evaluation of its staffing
requirements.7chanroblesvirtuallawlibrary
On January 24, 2005, Rodriguez and Rillera filed NLRC Case No. RAB-lIi-01-8376-05,8 while
Padrigon filed NLRC Case No. RAB-III-01-8401-05, both for illegal dismissal and money claims,
against TCIS and Dr. Cho. TCIS and Dr. Cho were served with summons by registry through Dr.
Cho, giving them 10 days from receipt to file their position paper.9 TCIS and Dr. Cho did not file
their position paper, but they were represented by counsel at the hearings held on February 15,
2005, March 15, 2005, and April 19, 2005.10chanroblesvirtuallawlibrary
On May 8, 2006, the Labor Arbiter (LA) rendered a Decision11 finding that the respondents were
illegally dismissed, and directed TCIS and Dr. Cho to reinstate them with full backwages in the
total amount of P1,125 000.00, plus 10% as attorney's fees.12 Dr. Cho received a copy of the
decision on June 21, 2006.13chanroblesvirtuallawlibrary
On August 11, 2006, the complainants moved for issuance of a writ of execution. At the
September 22, 2006 pre-execution conference, Atty. Joy P. Bayona (Atty. Bayona) entered her
appearance as counsel for TCIS and Dr. Cho. Conferences were held on October 2, 2006, October
23, 2006, November 24, 2006 and December 15, 2006. But at the hearing held on December 1 8,
2006, the law firm of Andres Marcelo Pedernal Guerrero and Paras entered its appearance as
counsel for TCIS and filed a petition for relief from judgment. On January 30, 2007, the LA
directed the issuance of a writ of execution, which was served on TCIS's counsel on February 8,
2007; the LA merely noted the petition for relief due to wrong venue and lack of jurisdiction and
because it was a prohibited pleading.14chanroblesvirtuallawlibrary
On February 19, 2007, TCIS re-filed its petition for relief, with prayer for Temporary Restraining
Order and/or writ of preliminary injunction, before the NLRC. It claimed that the LA did not
acquire jurisdiction over it since the summons and notices were addressed to Dr. Cho, who did
not represent TCIS; that the entry of appearance of Atty. Bayona at the pre-execution conference
was signed only by Dr. Cho in his capacity as therein respondent and academic dean of TCIS; that
TCIS did not receive any notice of the proceedings; and, that although the NLRC is not bound by
technical rules of procedure, TCIS's right to due process was violated since it was deprived of the
right to file its position paper. TCIS further argued it faced a shut-down and would suffer
irreparable damage unless the execution was enjoined, although it also expressed willingness to
post a bond to guarantee payment of whatever damages may be awarded by the
NLRC.15chanroblesvirtuallawlibrary
On September 30, 2011, the NLRC denied TCIS's petition on the ground that it had other
adequate remedies such as a motion for new trial or an appeal; that it failed to show that due to
fraud, accident, mistake or excusable negligence it was prevented from availing thereof; that it
could not avail of the equitable remedy of petition for relief for the purpose of reviving its appeal
which it lost through its negligence.16chanroblesvirtuallawlibrary
On petition for certiorari, the CA dismissed on May 24, 2012 the TCIS's petition outright for its
failure to indicate the material dates to show the timeliness of the petition. Moreover, TCIS
attached an incomplete copy of the NLRC decision as well as did not attach copies of the
complaint, position papers, appeal memorandum, motion for reconsideration and other relevant
portions of the records to support the allegations in the petition.17 The CA also denied its motion
for reconsideration on September 26, 2012 for lack of meritorious
grounds.18chanRoblesvirtualLawlibrary
Petition for Review in the Supreme Court
In this petition, TCIS invokes the following grounds:
A.
THE HONORABLE [NLRC] ERRED IN APPLYING RIGIDLY THE PROCEDURAL RULES ON
TECHNICAL REQUIREMENTS AND DISMISSED [TCIS'S] CERTIORARI BASED ONLY
THEREON|;]chanRoblesvirtualLawlibrary
B.
THE HONORABLE [NLRC] GRAVELY ERRED IN HOLDING THAT THE SUMMONS WERE VALID
DESPITE BEING DIRECTED TO DR. CLIO, THE ACADEMIC DEAN OF
[TCIS;]chanRoblesvirtualLawlibrary
C.
THE HONORABLE [NLRC] GRAVELY ERRED IN HOLDING THAT TEIE [RESPONDENTS] WERE
ILLEGALLY DISMISSED[.]19chanrobleslaw
In Jaro v. CA,20 where the CA dismissed a petition for review from a Department of Agrarian
Reform Adjudication Board (DARAB.) decision for not being in proper form and lacking pertinent
annexes, the Court admonished the appellate court for putting a premium on technicalities at
the expense of a just resolution of the case, and ruled that there was more than substantial
compliance when the landowner amended the petition, now in proper form and accompanied by
annexes which were all certified true copies by the DARAB. The Court stated:
In Cusi-Hernandez vs. Diaz and Piglas-Kamao vs. [NLRC], we ruled that the subsequent submission
of the missing documents with the motion for reconsideration amounts to substantial
compliance. The reasons behind the failure of the petitioners in these two cases to comply with
the required attachments were no longer scrutinized. What we found noteworthy in each case
was the fact that the petitioners therein substantially complied with the formal requirements.
We ordered the remand of the petitions in these cases to the [CA], stressing the ruling that by
precipitately dismissing the petitions "the appellate court clearly put a premium on technicalities
at the expense of a just resolution of the case."
We cannot see why the same leniency cannot be extended to petitioner, x x x.
If we were to apply the rules of procedure in a very rigid and technical sense, as what the [CA]
would have it in this case, the ends of justice would be defeated. In Cusi-Hernundez vs. Diaz,
where the formal requirements were liberally construed and substantial compliance were
recognized, we explained that rules of procedure are mere tools designed to expedite the
decision or resolution of cases and other matters pending in court. Hence, a strict and rigid
application of technicalities that, tend to frustrate rather than promote substantial justice must
be avoided. We further declared that:ChanRoblesVirtualawlibrary
"Cases should be determined on the merits, after full opportunity to all parties for ventilation of
their causes and defenses, rather than on technicality or some procedural imperfections. In that
way, the ends of justice would be served better."
In the similar case of Piglas-Kamao vs. [NLRC], we stressed the policy of the courts to encourage
the full adjudication of the merits of an appeal.21 (Citations omitted and italics in the original)
In Piglas Kamao (Sari-Sari Chapter) v. NLRC,22 the Court also ruled that there was substantial
compliance after the petitioner therein subsequently attached the lacking documents to the
motion for reconsideration, reiterating the Court's policy to encourage the full adjudication of
the merits of an appeal.23chanroblesvirtuallawlibrary
As to the merits of its petition before the NLRC, TCIS argued that its right to due process was
violated due to the invalid service of the summons and a copy of the complaint in the LA;
moreover, being mere probationary employees, the respondents were validly dismissed for
failing to qualify as regular employees.
The Court denies the petition.
In Philippine Amanah Bank (now Al-Amanah Islamic Investment Bank of the Philippines, also
known as Islamic Bank) v. Contreras,24 the Court stated:
Relief from judgment is a remedy provided by law to any person against whom a decision or
order is entered through fraud, accident, mistake, or excusable negligence. It is a remedy,
equitable in character, that is allowed only in exceptional cases when there is no other available
or adequate remedy. When a party has another remedy available to him, which may either be a
motion for new trial or appeal from an adverse decision of the trial court, and he was not
prevented by fraud, accident, mistake, or excusable negligence from filing such motion or taking
such appeal, he cannot avail of the remedy of petition for relief.25(Citation omitted)
period allowed.31chanroblesvirtuallawlibrary
Moreover, the Court agrees with the CA that no fraud, accident, mistake, or excusable negligence
prevented TCIS from filing an appeal from the decision of the LA, even as the NLRC also noted
that the petition also lacked the requisite affidavit showing the fraud, accident, mistake or
excusable negligence, and the facts constituting its good and substantial cause of
action.32chanroblesvirtuallawlibrary

Otherwise, the petition for relief will be tantamount to reviving the right of appeal which has TCIS was afforded every opportunity to be heard. The service of summons and notices of
already been lost either because of inexcusable negligence or due to the mistake in the mode of proceedings to Dr. Cho was perfectly valid and binding upon TCIS since they were sent to him at
procedure by counsel.26chanroblesvirtuallawlibrary its address, and Dr. Cho is a responsible officer of TCIS. Dr. Cho was TCIS's academic dean who
hired the respondents and also signed their termination letters. The attendance of TCIS's counsel
In Tuason v. CA;27 the Court explained the nature of a petition for relief from judgment, thus: at the hearings held on February 15, 2005, March 15, 2005, and April 19, 2005 is also proof that
it was duly notified of the LA's judgment.33chanroblesvirtuallawlibrary
A petition for relief from judgment is an equitable remedy; it is allowed only in exceptional cases
where there is no other available or adequate remedy. When a party has another remedy WHEREFORE, premises considered, the petition for review is DENIED.
available to him, which may be either a motion for new trial or appeal from an adverse decision
of the trial court, and he was not prevented by fraud, accident, mistake or excusable negligence SO ORDERED.cralawlawlibrary
from filing such motion or taking such appeal, he cannot avail himself of this petition. Indeed,
relief will not be granted to a party who seeks avoidance from the effects of the judgment when
the loss of the remedy at law was due to his own negligence; otherwise the petition for relief can
be used to revive the right to appeal which had been lost thru inexcusable
negligence.28 (Citations omitted)

As provided in Section 3, Rule 38 of the Rules of Court, a party filing a petition for relief from
judgment must strictly comply with two (2) reglementary periods: first, the petition must be filed
within sixty (60) days from knowledge of the judgment, order or other proceeding to be set
aside; and second, within a fixed period of six (6) months from entry of such judgment, order or
other proceeding. Strict compliance with these periods is required because a petition for relief
from judgment is a final act of liberality on the part of the State, which remedy cannot be allowed
to erode any further the fundamental principle that a judgment, order or proceeding must, at
some definite time, attain finality in order to put an end to
litigation.29chanroblesvirtuallawlibrary

The NLRC pointed out that TCIS's petition for relief was filed beyond the period provided under
Rule 38.30The earliest that it could have learned of the LA's judgment was on June 21, 2006 when
Dr. Cho received a copy thereof, and the latest was during the pre-execution conference held on
September 22, 2006, when Atty. Bayona formally entered her appearance as counsel for TCIS and
Dr. Cho. TCIS's petition for relief was filed only on February 13, 2007, well beyond the 60-day
Rule 47 On March 2, 1991, respondents obtained a loan of 45,000.00 from petitioner payable in six
months and secured by a Real Estate Mortgage6 over their 202-square meter property located in
Marulas, Valenzuela and covered by Transfer Certificate of Title (TCT) No. V-12296.7 When the
debt became due, respondents failed to pay notwithstanding demand. Thus, on September 17,
Republic of the Philippines 1999, petitioner filed with the RTC a Complaint8 praying that respondents be ordered:
SUPREME COURT
Manila (a) To pay petitioner the principal obligation of 45,000.00, with interest thereon at the
rate of 12% per annum, from 02 March 1991 until the full obligation is paid.
SECOND DIVISION
(b) To pay petitioner actual damages as may be proven during the trial but shall in no
G.R. No. 173559 January 7, 2013 case be less than 10,000.00; 25,000.00 by way of attorneys fee, plus 2,000.00 per
hearing as appearance fee.
LETICIA DIONA, represented by her Attorney-in-Fact, MARCELINA DIONA, Petitioner,
vs. (c) To issue a decree of foreclosure for the sale at public auction of the aforementioned
ROMEO A. BALANGUE, SONNY A. BALANGUE, REYNALDO A. BALANGUE, and ESTEBAN A. parcel of land, and for the disposition of the proceeds thereof in accordance with law,
BALANGUE, JR., Respondents. upon failure of the respondents to fully pay petitioner within the period set by law the
sums set forth in this complaint.
DECISION
(d) Costs of this suit.
DEL CASTILLO, J.:
Other reliefs and remedies just and equitable under the premises are likewise prayed
for.9 (Emphasis supplied)
The great of a relief neither sought by the party in whose favor it was given not supported by the
evidence presented violates the opposing partys right to due process and may be declared void
ab initio in a proper proceeding. Respondents were served with summons thru respondent Sonny A. Balangue (Sonny). On
October 15, 1999, with the assistance of Atty. Arthur C. Coroza (Atty. Coroza) of the Public
Attorneys Office, they filed a Motion to Extend Period to Answer. Despite the requested
This Petition for Review on Certiorari1 assails the November 24, 2005 Resolution2 of the Court of
extension, however, respondents failed to file any responsive pleadings. Thus, upon motion of
Appeals (CA) issued in G.R. SP No. 85541 which granted the Petition for Annulment of
the petitioner, the RTC declared them in default and allowed petitioner to present her evidence
Judgment3 filed by the respondents seeking to nullify that portion of the October 17, 2000
ex parte.10
Decision4 of the Regional Trial Court (RTC), Branch 75, Valenzuela City awarding petitioner 5%
monthly interest rate for the principal amount of the loan respondent obtained from her.
Ruling of the RTC sought to be annulled.
This Petition likewise assails the CAs June 26, 2006 Resolution5 denying petitioners Motion for
Reconsideration. In a Decision11 dated October 17, 2000, the RTC granted petitioners Complaint. The dispositive
portion of said Decision reads:
Factual Antecedents
WHEREFORE, judgment is hereby rendered in favor of the petitioner, ordering the respondents
to pay the petitioner as follows:
The facts of this case are simple and undisputed.
 a) the sum of FORTY FIVE THOUSAND (45,000.00) PESOS, representing the unpaid
principal loan obligation plus interest at 5% per month [sic] reckoned from March 2,
1991, until the same is fully paid;
b) 20,000.00 as attorneys fees plus cost of suit;
c) in the event the [respondents] fail to satisfy the aforesaid obligation, an order of
foreclosure shall be issued accordingly for the sale at public auction of the subject
property covered by Transfer Certificate of Title No. V-12296 and the improvements
thereon for the satisfaction of the petitioners claim.
SO ORDERED.12 (Emphasis supplied)
Subsequently, petitioner filed a Motion for Execution,13 alleging that respondents did not
interpose a timely appeal despite receipt by their former counsel of the RTCs Decision on
November 13, 2000. Before it could be resolved, however, respondents filed a Motion to Set
Aside Judgment14 dated January 26, 2001, claiming that not all of them were duly served with
summons. According to the other respondents, they had no knowledge of the case because their
co-respondent Sonny did not inform them about it. They prayed that the RTCs October 17, 2000
Decision be set aside and a new trial be conducted.
But on March 16, 2001, the RTC ordered15 the issuance of a Writ of Execution to implement its
October 17, 2000 Decision. However, since the writ could not be satisfied, petitioner moved for
the public auction of the mortgaged property,16 which the RTC granted.17 In an auction sale
conducted on November 7, 2001, petitioner was the only bidder in the amount of 420,000.00.
Thus, a Certificate of Sale18 was issued in her favor and accordingly annotated at the back of TCT
No. V-12296.
Respondents then filed a Motion to Correct/Amend Judgment and To Set Aside Execution
Sale19 dated December 17, 2001, claiming that the parties did not agree in writing on any rate of
interest and that petitioner merely sought for a 12% per annum interest in her Complaint.
Surprisingly, the RTC awarded 5% monthly interest (or 60% per annum) from March 2, 1991
until full payment. Resultantly, their indebtedness inclusive of the exorbitant interest from
March 2, 1991 to May 22, 2001 ballooned from 124,400.00 to 652,000.00.
In an Order20 dated May 7, 2002, the RTC granted respondents motion and accordingly modified
the interest rate awarded from 5% monthly to 12% per annum. Then on August 2, 2002,
respondents filed a Motion for Leave To Deposit/Consign Judgment Obligation 21 in the total
amount of 126,650.00.22
Displeased with the RTCs May 7, 2002 Order, petitioner elevated the matter to the CA via a
Petition for Certiorari23under Rule 65 of the Rules of Court. On August 5, 2003, the CA rendered a
Decision24 declaring that the RTC exceeded its jurisdiction in awarding the 5% monthly interest
but at the same time pronouncing that the RTC gravely abused its discretion in subsequently
reducing the rate of interest to 12% per annum. In so ruling, the CA ratiocinated:
Indeed, We are convinced that the Trial Court exceeded its jurisdiction when it granted 5%
monthly interest instead of the 12% per annum prayed for in the complaint. However, the
proper remedy is not to amend the judgment but to declare that portion as a nullity. Void
judgment for want of jurisdiction is no judgment at all. It cannot be the source of any right nor
the creator of any obligation (Leonor vs. CA, 256 SCRA 69). No legal rights can emanate from a
resolution that is null and void (Fortich vs. Corona, 312 SCRA 751).
From the foregoing, the remedy of the respondents is to have the Court declare the portion of the
judgment providing for a higher interest than that prayed for as null and void for want of or in
excess of jurisdiction. A void judgment never acquire[s] finality and any action to declare its
nullity does not prescribe (Heirs of Mayor Nemencio Galvez vs. CA, 255 SCRA 672).
WHEREFORE, foregoing premises considered, the Petition having merit, is hereby GIVEN DUE
COURSE. Resultantly, the challenged May 7, 2002 and September 5, 2000 orders of Public
Respondent Court are hereby ANNULLED and SET ASIDE for having been issued with grave
abuse of discretion amounting to lack or in excess of jurisdiction. No costs.
SO ORDERED.25 (Emphases in the original; italics supplied.)
Proceedings before the Court of Appeals
Taking their cue from the Decision of the CA in the special civil action for certiorari, respondents
filed with the same court a Petition for Annulment of Judgment and Execution Sale with
Damages.26 They contended that the portion of the RTC Decision granting petitioner 5% monthly
interest rate is in gross violation of Section 3(d) of Rule 9 of the Rules of Court and of their right
to due process. According to respondents, the loan did not carry any interest as it was the verbal
agreement of the parties that in lieu thereof petitioners family can continue occupying
respondents residential building located in Marulas, Valenzuela for free until said loan is fully
paid.
Ruling of the Court of Appeals
Initially, the CA denied due course to the Petition.27 Upon respondents motion, however, it
reinstated and granted the Petition. In setting aside portions of the RTCs October 17, 2000
Decision, the CA ruled that aside from being unconscionably excessive, the monthly interest rate
of 5% was not agreed upon by the parties and that petitioners Complaint clearly sought only the
legal rate of 12% per annum. Following the mandate of Section 3(d) of Rule 9 of the Rules of
Court, the CA concluded that the awarded rate of interest is void for being in excess of the relief
sought in the Complaint. It ruled thus:
WHEREFORE, respondents motion for reconsideration is GRANTED and our resolution dated
October 13, 2004 is, accordingly, REVERSED and SET ASIDE. In lieu thereof, another is entered
ordering the ANNULMENT OF:
(a) public respondents impugned October 17, 2000 judgment, insofar as it awarded 5%
monthly interest in favor of petitioner; and
(b) all proceedings relative to the sale at public auction of the property titled in
respondents names under Transfer Certificate of Title No. V-12296 of the Valenzuela
registry.
The judgment debt adjudicated in public respondents impugned October 17, 2000 judgment is,
likewise, ordered RECOMPUTED at the rate of 12% per annum from March 2, 1991. No costs.
SO ORDERED.28 (Emphases in the original.)
Petitioner sought reconsideration, which was denied by the CA in its June 26, 2006 Resolution.29
Issues
Hence, this Petition anchored on the following grounds:
I. THE HONORABLE COURT OF APPEALS COMMITTED GRAVE AND SERIOUS ERROR OF
LAW WHEN IT GRANTED RESPONDENTS PETITION FOR ANNULMENT OF JUDGMENT
AS A SUBSTITUTE OR ALTERNATIVE REMEDY OF A LOST APPEAL.
II. THE HONORABLE COURT OF APPEALS COMMITTED GRAVE AND SERIOUS ERROR
AND MISAPPREHENSION OF LAW AND THE FACTS WHEN IT GRANTED RESPONDENTS
PETITION FOR ANNULMENT OF JUDGMENT OF THE DECISION OF THE REGIONAL
TRIAL COURT OF VALENZUELA, BRANCH 75 DATED OCTOBER 17, 2000 IN CIVIL CASE
NO. 241-V-99, DESPITE THE FACT THAT SAID DECISION HAS BECOME FINAL AND
ALREADY EXECUTED CONTRARY TO THE DOCTRINE OF IMMUTABILITY OF
JUDGMENT.30
Petitioners Arguments
Petitioner claims that the CA erred in partially annulling the RTCs October 17, 2000 Decision.
She contends that a Petition for Annulment of Judgment may be availed of only when the
ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies are no
longer available through no fault of the claimant. In the present case, however, respondents had
all the opportunity to question the October 17, 2000 Decision of the RTC, but because of their
own inaction or negligence they failed to avail of the remedies sanctioned by the rules. Instead,
they contented themselves with the filing of a Motion to Set Aside Judgment and then a Motion to
Correct/Amend Judgment and to Set Aside Execution Sale.
Petitioner likewise argues that for a Rule 47 petition to prosper, the same must either be based
on extrinsic fraud or lack of jurisdiction. However, the allegations in respondents Rule 47
petition do not constitute extrinsic fraud because they simply pass the blame to the negligence of
their former counsel. In addition, it is too late for respondents to pass the buck to their erstwhile
counsel considering that when they filed their Motion to Correct/Amend Judgment and To Set
Aside Execution Sale they were already assisted by their new lawyer, Atty. Reynaldo A. Ruiz, who
did not also avail of the remedies of new trial, appeal, etc. As to the ground of lack of jurisdiction,
petitioner posits that there is no reason to doubt that the RTC had jurisdiction over the subject
matter of the case and over the persons of the respondents.
While conceding that the RTC patently made a mistake in awarding 5% monthly interest,
petitioner nonetheless invokes the doctrine of immutability of final judgment and contends that
the RTC Decision can no longer be corrected or modified since it had long become final and
executory. She likewise points out that respondents received a copy of said Decision on
November 13, 2000 but did nothing to correct the same. They did not even question the award of
5% monthly interest when they filed their Motion to Set Aside Judgment which they anchored on
the sole ground of the RTCs lack of jurisdiction over the persons of some of the respondents.
Respondents Arguments
Respondents do not contest the existence of their obligation and the principal amount thereof.
They only seek quittance from the 5% monthly interest or 60% per annum imposed by the RTC.
Respondents contend that Section (3)d of Rule 9 of the Rules of Court is clear that when the
defendant is declared in default, the court cannot grant a relief more than what is being prayed
for in the Complaint. A judgment which transgresses said rule, according to the respondents, is
void for having been issued without jurisdiction and for being violative of due process of law.
Respondents maintain that it was through no fault of their own, but through the gross negligence
of their former counsel, Atty. Coroza, that the remedies of new trial, appeal or petition for relief
from judgment were lost. They allege that after filing a Motion to Extend Period to Answer, Atty.
Coroza did not file any pleading resulting to their being declared in default. While the said lawyer
filed on their behalf a Motion to Set Aside Judgment dated January 26, 2001, he however took no
steps to appeal from the Decision of the RTC, thereby allowing said judgment to lapse into
finality. Citing Legarda v. Court of Appeals,31 respondents aver that clients are not always bound
by the actions of their counsel, as in the present case where the clients are to lose their property
due to the gross negligence of their counsel.
With regard to petitioners invocation of immutability of judgment, respondents argue that said
doctrine applies only to valid and not to void judgments.
Our Ruling
The petition must fail.
We agree with respondents that the award of 5% monthly interest violated their right to due
process and, hence, the same may be set aside in a Petition for Annulment of Judgment filed
under Rule 47 of the Rules of Court.
Annulment of judgment under Rule 47; an exception to the final judgment rule; grounds therefor.
A Petition for Annulment of Judgment under Rule 47 of the Rules of Court is a remedy granted
only under exceptional circumstances where a party, without fault on his part, has failed to avail
of the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies.
Said rule explicitly provides that it is not available as a substitute for a remedy which was lost
due to the partys own neglect in promptly availing of the same. "The underlying reason is
traceable to the notion that annulling final judgments goes against the grain of finality of
judgment. Litigation must end and terminate sometime and somewhere, and it is essential to an
effective administration of justice that once a judgment has become final, the issue or cause
involved therein should be laid to rest."32
While under Section 2, Rule 4733 of the Rules of Court a Petition for Annulment of Judgment may
be based only on the grounds of extrinsic fraud and lack of jurisdiction, jurisprudence recognizes
lack of due process as additional ground to annul a judgment.34 In Arcelona v. Court of
Appeals,35 this Court declared that a final and executory judgment may still be set aside if, upon
mere inspection thereof, its patent nullity can be shown for having been issued without
jurisdiction or for lack of due process of law.
Grant of 5% monthly interest is way beyond the 12% per annum interest sought in the
Complaint and smacks of violation of due process.
It is settled that courts cannot grant a relief not prayed for in the pleadings or in excess of what is
being sought by the party. They cannot also grant a relief without first ascertaining the evidence
presented in support thereof. Due process considerations require that judgments must conform
to and be supported by the pleadings and evidence presented in court. In Development Bank of
the Philippines v. Teston,36 this Court expounded that:
Due process considerations justify this requirement. It is improper to enter an order which
exceeds the scope of relief sought by the pleadings, absent notice which affords the opposing
party an opportunity to be heard with respect to the proposed relief. The fundamental purpose
of the requirement that allegations of a complaint must provide the measure of recovery is to
prevent surprise to the defendant.
Notably, the Rules is even more strict in safeguarding the right to due process of a defendant who
was declared in default than of a defendant who participated in trial. For instance, amendment to
conform to the evidence presented during trial is allowed the parties under the Rules.37 But the
same is not feasible when the defendant is declared in default because Section 3(d), Rule 9 of the
Rules of Court comes into play and limits the relief that may be granted by the courts to what has
been prayed for in the Complaint. It provides:
(d) Extent of relief to be awarded. A judgment rendered against a party in default shall not
exceed the amount or be different in kind from that prayed for nor award unliquidated damages.
The raison dtre in limiting the extent of relief that may be granted is that it cannot be presumed
that the defendant would not file an Answer and allow himself to be declared in default had he
known that the plaintiff will be accorded a relief greater than or different in kind from that
sought in the Complaint.38 No doubt, the reason behind Section 3(d), Rule 9 of the Rules of Court
is to safeguard defendants right to due process against unforeseen and arbitrarily issued
judgment. This, to the mind of this Court, is akin to the very essence of due process. It embodies
"the sporting idea of fair play"39 and forbids the grant of relief on matters where the defendant
was not given the opportunity to be heard thereon.
In the case at bench, the award of 5% monthly interest rate is not supported both by the
allegations in the pleadings and the evidence on record. The Real Estate Mortgage40 executed by
the parties does not include any provision on interest. When petitioner filed her Complaint
before the RTC, she alleged that respondents borrowed from her "the sum of FORTY-FIVE
THOUSAND PESOS (45,000.00), with interest thereon at the rate of 12% per annum"41 and
sought payment thereof. She did not allege or pray for the disputed 5% monthly interest. Neither
did she present evidence nor testified thereon. Clearly, the RTCs award of 5% monthly interest
or 60% per annum lacks basis and disregards due process. It violated the due process
requirement because respondents were not informed of the possibility that the RTC may award
5% monthly interest. They were deprived of reasonable opportunity to refute and present
controverting evidence as they were made to believe that the complainant petitioner was
seeking for what she merely stated in her Complaint.
Neither can the grant of the 5% monthly interest be considered subsumed by petitioners general
prayer for "other reliefs and remedies just and equitable under the premises x x x." 42 To repeat,
the courts grant of relief is limited only to what has been prayed for in the Complaint or related
thereto, supported by evidence, and covered by the partys cause of action.43 Besides, even
assuming that the awarded 5% monthly or 60% per annum interest was properly alleged and
proven during trial, the same remains unconscionably excessive and ought to be equitably
reduced in accordance with applicable jurisprudence. In Bulos, Jr. v. Yasuma,44 this Court held:
In the case of Ruiz v. Court of Appeals, citing the cases of Medel v. Court of Appeals, Garcia v.
Court of Appeals, Spouses Bautista v. Pilar Development Corporation and the recent case of
Spouses Solangon v. Salazar, this Court considered the 3% interest per month or 36% interest
per annum as excessive and unconscionable. Thereby, the Court, in the said case, equitably
reduced the rate of interest to 1% interest per month or 12% interest per annum. (Citations
omitted)
It is understandable for the respondents not to contest the default order for, as alleged in their
Comment, "it is not their intention to impugn or run away from their just and valid
obligation."45 Nonetheless, their waiver to present evidence should never be construed as waiver
to contest patently erroneous award which already transgresses their right to due process, as
well as applicable jurisprudence.
Respondents former counsel was grossly negligent in handling the case of his clients;
respondents did not lose ordinary remedies of new trial, petition for relief, etc. through their
own fault.
Ordinarily, the mistake, negligence or lack of competence of counsel binds the
client.1wphi1 This is based on the rule that any act performed by a counsel within the scope of
his general or implied authority is regarded as an act of his client. A recognized exception to the
rule is when the lawyers were grossly negligent in their duty to maintain their clients cause and
such amounted to a deprivation of their clients property without due process of law. 46 In which
case, the courts must step in and accord relief to a client who suffered thereby. 47
The manifest indifference of respondents former counsel in handling the cause of his client was
already present even from the beginning. It should be recalled that after filing in behalf of his
clients a Motion to Extend Period to Answer, said counsel allowed the requested extension to
pass without filing an Answer, which resulted to respondents being declared in default. His
negligence was aggravated by the fact that he did not question the awarded 5% monthly interest
despite receipt of the RTC Decision on November 13, 2000.48 A simple reading of the dispositive
portion of the RTC Decision readily reveals that it awarded exorbitant and unconscionable rate
of interest. Its difference from what is being prayed for by the petitioner in her Complaint is so
blatant and very patent. It also defies elementary jurisprudence on legal rate of interests. Had the
counsel carefully read the judgment it would have caught his attention and compelled him to
take the necessary steps to protect the interest of his client. But he did not. Instead, he filed in
behalf of his clients a Motion to Set Aside Judgment49 dated January 26, 2001 based on the sole
ground of lack of jurisdiction, oblivious to the fact that the erroneous award of 5% monthly
interest would result to his clients deprivation of property without due process of law. Worse,
he even allowed the RTC Decision to become final by not perfecting an appeal. Neither did he file
a petition for relief therefrom. It was only a year later that the patently erroneous award of 5%
monthly interest was brought to the attention of the RTC when respondents, thru their new
counsel, filed a Motion to Correct/Amend Judgment and To Set Aside Execution Sale. Even the
RTC candidly admitted that it "made a glaring mistake in directing the defendants to pay interest
on the principal loan at 5% per month which is very different from what was prayed for by the
plaintiff."50
"A lawyer owes entire devotion to the interest of his client, warmth and zeal in the maintenance
and defense of his rights and the exertion of his utmost learning and ability, to the end that
nothing can be taken or withheld from his client except in accordance with the law." 51 Judging
from how respondents former counsel handled the cause of his clients, there is no doubt that he
was grossly negligent in protecting their rights, to the extent that they were deprived of their
property without due process of law.
In fine, respondents did not lose the remedies of new trial, appeal, petition for relief and other
remedies through their own fault. It can only be attributed to the gross negligence of their
erstwhile counsel which prevented them from pursuing such remedies. We cannot also blame
respondents for relying too much on their former counsel. Clients have reasonable expectations
that their lawyer would amply protect their interest during the trial of the case. 52 Here,

"respondents are plain and ordinary people x x x who are totally ignorant of the intricacies and
technicalities of law and legal procedures. Being so, they completely relied upon and trusted
their former counsel to appropriately act as their interest may lawfully warrant and require." 53

As a final word, it is worth noting that respondents principal obligation was only 45,000.00.
Due to their former counsels gross negligence in handling their cause, coupled with the RTCs
erroneous, baseless, and illegal award of 5% monthly interest, they now stand to lose their
property and still owe petitioner a large amount of money. As aptly observed by the CA:

x x x If the impugned judgment is not, therefore, rightfully nullified, petitioners will not only end
up losing their property but will additionally owe private respondent the sum of 232,000.00
plus the legal interest said balance had, in the meantime, earned. As a court of justice and equity,
we cannot, in good conscience, allow this unconscionable situation to prevail.54

Indeed, this Court is appalled by petitioners invocation of the doctrine of immutability of

judgment. Petitioner does not contest as she even admits that the RTC made a glaring mistake in
awarding 5% monthly interest.55 Amazingly, she wants to benefit from such erroneous award.
This Court cannot allow this injustice to happen.

WHEREFORE, the instant Petition is hereby DENIED and the assailed November 24, 2005 and
June 26, 2006 Resolution of the Court of Appeals in CA-G.R. SP No. 85541 are AFFIRMED.

SO ORDERED.
 SECOND DIVISION
G.R. No. 187061, October 08, 2014
CELERINA J. SANTOS, Petitioner, v. RICARDO T. SANTOS, Respondent.
DECISION
LEONEN, J.:
The proper remedy for a judicial declaration of presumptive death obtained by extrinsic fraud is
an action to annul the judgment. An affidavit of reappearance is not the proper remedy when the
person declared presumptively dead has never been absent.
This is a petition for review on certiorari filed by Celerina J. Santos, assailing the Court of
Appeals' resolutions dated November 28, 2008 and March 5, 2009. The Court of Appeals
dismissed the petition for the annulment of the trial court's judgment declaring her
presumptively dead.
On July 27, 2007, the Regional Trial Court of Tarlac City declared petitioner Celerina J. Santos
(Celerina) presumptively dead after her husband, respondent Ricardo T. Santos (Ricardo), had
filed a petition for declaration of absence or presumptive death for the purpose of remarriage
on June 15, 2007.1 Ricardo remarried on September 17, 2008.2chanrobleslaw
In his petition for declaration of absence or presumptive death, Ricardo alleged that he and
Celerina rented an apartment somewhere in San Juan, Metro Manila; after they had gotten
married on June 18, 1980.3 After a year, they moved to Tarlac City. They were engaged in the buy
and sell business.4chanrobleslaw
Ricardo claimed that their business did not prosper.5 As a result, Celerina convinced him to allow
her to work as a domestic helper in Hong Kong.6 Ricardo initially refused but because of
Celerina's insistence, he allowed her to work abroad.7 She allegedly applied in an employment
agency in Ermita, Manila, in February 1995. She left Tarlac two months after and was never
heard from again.8chanrobleslaw
Ricardo further alleged that he exerted efforts to locate Celerina.9 He went to Celerina's parents
in Cubao, Quezon City, but they, too, did not know their daughter's whereabouts. 10 He also
inquired about her from other relatives and friends, but no one gave him any
information.11chanrobleslaw
Ricardo claimed that it was almost 12 years from the date of his Regional Trial Court petition
since Celerina left. He believed that she had passed away.12chanrobleslaw
Celerina claimed that she learned about Ricardo's petition only sometime in October 2008 when
she could no longer avail the remedies of new trial, appeal, petition for relief, or other
appropriate remedies.13chanrobleslaw
On November 17, 2008, Celerina filed a petition for annulment of judgment 14 before the Court of
Appeals on the grounds of extrinsic fraud and lack of jurisdiction. She argued that she was
deprived her day in court when Ricardo, despite his knowledge of her true residence,
misrepresented to the court that she was a resident of Tarlac City.15 According to Celerina, her
true residence was in Neptune Extension, Congressional Avenue, Quezon City. 16 This residence
had been her and Ricardo's conjugal dwelling since 1989 until Ricardo left in May 2008. 17 As a
result of Ricardo's misrepresentation, she was deprived of any notice of and opportunity to
oppose the petition declaring her presumptively dead.18chanrobleslaw
Celerina claimed that she never resided in Tarlac. She also never left and worked as a domestic
helper abroad.20 Neither did she go to an employment agency in February 1995.21 She also
claimed that it was not true that she had been absent for 12 years. Ricardo was aware that she
never left their conjugal dwelling in Quezon City.22 It was he who left the conjugal dwelling in
May 2008 to cohabit with another woman.23 Celerina referred to a joint affidavit executed by
their children to support her contention that Ricardo made false allegations in his
petition.24chanrobleslaw
Celerina also argued that the court did not acquire jurisdiction over Ricardo's petition because it
had never been published in a newspaper.25 She added that the Office of the Solicitor General and
the Provincial Prosecutor's Office were not furnished copies of Ricardo's
petition.26chanrobleslaw
The Court of Appeals issued the resolution dated November 28, 2008, dismissing Celerina's
petition for annulment of judgment for being a wrong mode of remedy. 27 According to the Court
of Appeals, the proper remedy was to file a sworn statement before the civil registry, declaring
her reappearance in accordance with Article 42 of the Family Code.28chanrobleslaw
Celerina filed a motion for reconsideration of the Court of Appeals' resolution dated November
28, 2008.29 The Court of Appeals denied the motion for reconsideration in the resolution dated
March 5, 2009.30chanrobleslaw

Hence, this petition was filed.
The issue for resolution is whether the Court of Appeals erred in dismissing Celerina's petition
for annulment of judgment for being a wrong remedy for a fraudulently obtained judgment
declaring presumptive death.
Celerina argued that filing an affidavit of reappearance under Article 42 of the Family Code is
appropriate only when the spouse is actually absent and the spouse seeking the declaration of
presumptive death actually has a well-founded belief of the spouse's death.31 She added that it
would be inappropriate to file an affidavit of reappearance if she did not disappear in the first
place.32 She insisted that an action for annulment of judgment is proper when the declaration of
presumptive death is obtained fraudulently.33chanrobleslaw
Celerina further argued that filing an affidavit of reappearance under Article 42 of the Family
Code would not be a sufficient remedy because it would not nullify the legal effects of the
judgment declaring her presumptive death.34chanrobleslaw
In Ricardo's comment,35 he argued that a petition for annulment of judgment is not the proper
remedy because it cannot be availed when there are other remedies available. Celerina could
always file an affidavit of reappearance to terminate the subsequent marriage. Ricardo iterated
the Court of Appeals' ruling that the remedy afforded to Celerina under Article 42 of the Family
Code is the appropriate remedy.
The petition is meritorious.
Annulment of judgment is the remedy when the Regional Trial Court's judgment, order, or
resolution has become final, and the "remedies of new trial, appeal, petition for relief (or other
appropriate remedies) are no longer available through no fault of the
petitioner."36chanrobleslaw
The grounds for annulment of judgment are extrinsic fraud and lack of jurisdiction. 37 This court
defined extrinsic fraud in Stilianopulos v. City of Legaspi:38chanrobleslaw
For fraud to become a basis for annulment of judgment, it has to be extrinsic or actual. It is
intrinsic when the fraudulent acts pertain to an issue involved in the original action or where the
acts constituting the fraud were or could have been litigated, It is extrinsic or collateral when a
litigant commits acts outside of the trial which prevents a parly from having a real contest, or from
presenting all of his case, such that there is no fair submission of the controversy. 39 (Emphasis
supplied)
Celerina alleged in her petition for annulment of judgment that there was fraud when Ricardo
deliberately made false allegations in the court with respect to her residence. 40 Ricardo also
falsely claimed that she was absent for 12 years. There was also no publication of the notice of
hearing of Ricardo's petition in a newspaper of general circulation.41 Celerina claimed that
because of these, she was deprived of notice and opportunity to oppose Ricardo's petition to
declare her presumptively dead.42chanrobleslaw
Celerina alleged that all the facts supporting Ricardo's petition for declaration of presumptive
death were false.43 Celerina further claimed that the court did not acquire jurisdiction because
the Office of the Solicitor General and the Provincial Prosecutor's Office were not given copies of
Ricardo's petition.44chanrobleslaw
These are allegations of extrinsic fraud and lack of jurisdiction. Celerina alleged in her petition
with the Court of Appeals sufficient ground/s for annulment of judgment.
Celerina filed her petition for annulment of judgment45 on November 17, 2008. This was less
than two years from the July 27, 2007 decision declaring her presumptively dead and about a
month from her discovery of the decision in October 2008. The petition was, therefore, filed
within the four-year period allowed by law in case of extrinsic fraud, and before the action is
barred by laches, which is the period allowed in case of lack of jurisdiction. 46chanrobleslaw
There was also no other sufficient remedy available to Celerina at the time of her discovery of the
fraud perpetrated on her.
The choice of remedy is important because remedies carry with them certain admissions,
presumptions, and conditions.
The Family Code provides that it is the proof of absence of a spouse for four consecutive years,
coupled with a well-founded belief by the present spouse that the absent spouse is already dead,
that constitutes a justification for a second marriage during the subsistence of another
marriage.47chanrobleslaw
The Family Code also provides that the second marriage is in danger of being terminated by the
presumptively dead spouse when he or she reappears. Thus:chanRoblesvirtualLawlibrary
Article 42. The subsequent marriage referred to in the preceding Article shall be automatically
terminated by the recording of the affidavit of reappearance of the absent spouse, unless there is
a judgment annulling the previous marriage or declaring it void ab initio.
A sworn statement of the fact and circumstances of reappearance shall be recorded in the civil
registry of the residence of the parties to the subsequent marriage at the instance of any
interested person, with due notice to the spouses of the subsequent marriage and without
prejudice to the fact of reappearance being judicially determined in case such fact is disputed.
(Emphasis supplied)
In other words, the Family Code provides the presumptively dead spouse with the remedy of
terminating the subsequent marriage by mere reappearance.
The filing of an affidavit of reappearance is an admission on the part of the first spouse that his or
her marriage to the present spouse was terminated when he or she was declared absent or
presumptively dead.
Moreover, a close reading of the entire Article 42 reveals that the termination of the subsequent
marriage by reappearance is subject to several conditions: (1) the non-existence of a judgment
annulling the previous marriage or declaring it void ab initio; (2) recording in the civil registry of
the residence of the parties to the subsequent marriage of the sworn statement of fact and
circumstances of reappearance; (3) due notice to the spouses of the subsequent marriage of the
fact of reappearance; and (4) the fact of reappearance must either be undisputed or judicially
determined.
The existence of these conditions means that reappearance does not always immediately cause
the subsequent marriage's termination. Reappearance of the absent or presumptively dead
spouse will cause the termination of the subsequent marriage only when all the conditions
enumerated in the Family Code are present.
Hence, the subsequent marriage may still subsist despite the absent or presumptively dead
spouse's reappearance (1) if the first marriage has already been annulled or has been declared a
nullity; (2) if the sworn statement of the reappearance is not recorded in the civil registry of the
subsequent spouses' residence; (3) if there is no notice to the subsequent spouses; or (4) if the
fact of reappearance is disputed in the proper courts of law, and no judgment is yet rendered
confirming, such fact of reappearance.
When subsequent marriages are contracted after a judicial declaration of presumptive death, a
presumption arises that the first spouse is already dead and that the second marriage is legal.
This presumption should prevail over the continuance of the marital relations with the first
spouse.48 The second marriage, as with all marriages, is presumed valid.49 The burden of proof to
show that the first marriage was not properly dissolved rests on the person assailing the validity
of the second marriage.50chanrobleslaw
This court recognized the conditional nature of reappearance as a cause for terminating the
subsequent marriage in Social Security System v. Vda. de Bailon.51 This court noted52 that mere
reappearance will not terminate the subsequent marriage even if the parties to the subsequent
marriage were notified if there was "no step . . . taken to terminate the subsequent marriage,
either by [filing an] affidavit [of reappearance] or by court action[.]" 53 "Since the second
marriage has been contracted because of a presumption that the former spouse is dead, such
presumption continues inspite of the spouse's physical reappearance, and by fiction of law, he or
she must still be regarded as legally an absentee until the subsequent marriage is terminated as
provided by law."54chanrobleslaw
The choice of the proper remedy is also important for purposes of determining the status of the
second marriage and the liabilities of the spouse who, in bad faith, claimed that the other spouse
was absent.
A second marriage is bigamous while the first subsists. However, a bigamous subsequent
marriage may be considered valid when the following are present:chanRoblesvirtualLawlibrary
1) The prior spouse had been absent for four consecutive years;
2) The spouse present has a well-founded belief that the absent spouse was already dead;
3) There must be a summary proceeding for the declaration of presumptive death of the
absent spouse; and
4) There is a court declaration of presumptive death of the absent spouse.55
A subsequent marriage contracted in bad faith, even if it was contracted after a court declaration
of presumptive death, lacks the requirement of a well-founded belief56 that the spouse is already
dead. The first marriage will not be considered as. validly terminated. Marriages contracted prior
to the valid termination of a subsisting marriage are generally considered bigamous and
void.57 Only a subsequent marriage contracted in good faith is protected by law.
Therefore, the party who contracted the subsequent marriage in bad faith is also not immune
from an action to declare his subsequent marriage void for being bigamous. The prohibition
against marriage during the subsistence of another marriage still applies. 58chanrobleslaw
If, as Celerina contends, Ricardo was in bad faith when he filed his petition to declare her
presumptively dead and when he contracted the subsequent marriage, such marriage would be
considered void for being bigamous under Article 35(4) of the Family Code. This is because the
circumstances lack the element of "well-founded belief under Article 41 of the Family Code,
which is essential for the exception to the rule against bigamous marriages to
apply.59chanrobleslaw
WHEREFORE, the case is REMANDED to the Court of Appeals for determination of the existence
of extrinsic fraud, grounds for nullity/annulment of the first marriage, and the merits of the
petition.
SO ORDERED.cralawlawlibrary

The provision on reappearance in the Family Code as a remedy to effect the termination of the
subsequent marriage does not preclude the spouse who was declared presumptively dead from
availing other remedies existing in law. This court had, in fact, recognized that a subsequent
marriage may also be terminated by filing "an action in court to prove the reappearance of the
absentee and obtain a declaration of dissolution or termination of the subsequent
marriage."60chanrobleslaw

Celerina does not admit to have been absent. She also seeks not merely the termination of the
subsequent marriage but also the nullification of its effects. She contends that reappearance is
not a sufficient remedy because it will only terminate the subsequent marriage but not nullify the
effects of the declaration of her presumptive death and the subsequent marriage.

Celerina is correct. Since an undisturbed subsequent marriage under Article 42 of the Family
Code is valid until terminated, the "children of such marriage shall be considered legitimate, and
the property relations of the spouse[s] in such marriage will be the same as in valid
marriages."61 If it is terminated by mere reappearance, the children of the subsequent marriage
conceived before the termination shall still be considered legitimate. 62 Moreover, a judgment
declaring presumptive death is a defense against prosecution for bigamy.63chanrobleslaw

It is true that in most cases, an action to declare the nullity of the subsequent marriage may
nullify the effects of the subsequent marriage, specifically, in relation to the status of children
and the prospect of prosecuting a respondent for bigamy.

However, "a Petition for Declaration of Absolute Nullity of Void Marriages may be filed solely by
the husband or wife."64 This means that even if Celerina is a real party in interest who stands to
be benefited or injured by the outcome of an action to nullify the second marriage, 65 this remedy
is not available to her.

Therefore, for the purpose of not only terminating the subsequent marriage but also of nullifying
the effects of the declaration of presumptive death and the subsequent marriage, mere filing of
an affidavit of reappearance would not suffice. Celerina's choice to file an action for annulment of
judgment will, therefore, lie.
 SECOND DIVISION attachment. However, this writ was eventually nullified when Lasala questioned it with the CA in
CA-G.R. SP No. 41124.
G.R. No. 171582, August 19, 2015
Meanwhile, on May 2, 1997, the trial court dismissed the NFA's complaint for failure of the
ALBERTO T. LASALA, PREVIOUSLY DOING BUSINESS UNDER THE STYLE PSF SECURITY lawyerdeputized by the Office of the Government Corporate Counsel (OGCC), Atty. Rogelio B.
AGENCY, Petitioner, v. THE NATIONAL FOOD AUTHORITY, Respondent. Mendoza (Atty. Mendoza), to present the NFA's evidence-in-chief, due to his repeated hearing
absences.
DECISION The NFA replaced Atty. Mendoza and administratively charged him with dishonesty, grave
misconduct, conduct grossly prejudicial to the best interests of the service, and gross neglect of
BRION, J.: duty.9 It subsequently employed Atty. Ernesto D. Cahucom (Atty. Cahucom) as its new counsel.

We resolve in this petition for review on certiorari1 the challenge to the June 14, 2005
Decision2 and the February 15, 2006 Resolution3 (CA rulings) of the Court of Appeals (CA) in CA-
G.R. SP No. 73235. These assailed CA rulings annulled the September 2, 2002 decision 4 of the
Regional Trial Court of Quezon City (RTC QC), Branch 220, which granted petitioner Alberto T.
Lasala's (Lasala) counterclaim against respondent National Food Authority (NFA).
Although the NFA's complaint was dismissed, Lasala's counterclaim remained, and he presented
evidence to support it. Interestingly, Atty. Cahucom, the NFA's new counsel, did not submit
any evidence to controvert Lasala's counterclaim evidence. When asked during trial, Atty.
Cahucom simply waived his right to cross-examine Lasala and did not exert any effort to counter
his testimony.

Factual Antecedents Thus, in its September 2, 2002 decision, the trial court granted Lasala's counterclaim in the total
amount of P52,788,970.5010 broken down as follows:chanRoblesvirtualLawlibrary
Lasala, through his company PSF Security Agency, used to provide security guard services to the
NFA. Sometime in 1994, Lasala's employees who were deployed to the NFA filed with the Nature of Award Amount
National Labor Relations Commission (NLRC) a complaint for underpayment of wages and
nonpayment of other monetary benefits. The NLRC ruled for the employees and held Lasala and Actual and compensatory P35,165,370.50
the NFA solidarily liable for the employees' adjudged monetary award.5 Consequently, the sheriff damages
garnished the NFA's P383,572.90 worth of bank deposits with the Development Bank of the Loss of business credit P10,000,000.00
Philippines.
Moral damages P5,000,000.00
Believing that it had no liability to Lasala's employees, the NFA filed with the RTC, Branch 220, Exemplary damages P500,000.00
Quezon City, a complaint for sum of money with damages and an application for the issuance of a Litigation expenses P500,000.00
writ of preliminary attachment against Lasala.6
Lasala's claim for wage P1,623,600.00plus 12% per annum from the year until full payment
In response, Lasala filed an answer with counterclaim7and opposition to the prayer for adjustment of this interest 2000 amount
preliminary attachment. In his counterclaim, Lasala prayed for the payment of moral damages Total P52,788,970.50
of P1,000,000.00; exemplary damages of P500,000.00; attorney's fees of P300,000.00,
compensatory damages of P250,000.00; and unpaid wage differential of P1,500,000.00,
for a total amount of P3,550,000.00.8 Notably, this amount is substantially higher than the amount of P3,550,000.00 Lasala
originally prayed for.
Initially, the trial court granted the NFA's prayer for the issuance of a writ of preliminary
Despite the huge award to Lasala, the NFA failed to appeal its case to the CA. Atty. Cahucom
did not inform the NFA's management about the trial court's adverse ruling. When asked to
explain, he reasoned out that he only discovered the decision after the lapse of the period for
appeal.11
Having lost its chance to appeal, the NFA filed with the trial court a petition for relief from
judgment (petition for relief) grounded on excusable negligence.12 In its petition, the NFA through
Atty. Cahucom, attributed its failure to appeal to one of the NFA's employees. Allegedly, this
employee received the copy of the trial court's September 2, 2002 decision but did not inform
Atty. Cahucom about it. It was only after the lapse of the period for the filing of a motion for
reconsideration and an appeal that the NFA learned about the adverse ruling.
The trial court did not accept the NFA's reasoning; thus, it denied the petition for relief for
insufficiency in substance.13
In the meantime, then NFA Administrator Arthur C. Yap had assumed his position. One of his first
instructions was the legal audit of all NFA cases. In doing this, the NFA management found out
that the two lawyers (Attys. Mendoza and Cahucom) assigned to the case against Lasala, grossly
mishandled it; hence, causing a huge and unjust liability to the NFA in the amount of
P52,788,970.50.
Thus, on the grounds of lack of jurisdiction and extrinsic fraud, the NFA, now through the OGCC,
filed with the CA a petition and an amended petition14for annulment of judgment (petition for
annulment) of the trial court's September 2, 2002 decision which had granted a substantially
higher award than what Lasala originally prayed for in his counterclaim.
The CA's Ruling
The CA granted the petition and annulled the trial court's September 2, 2002 decision.
It ruled that though Lasala's counterclaim is compulsory in nature (thus, it did not require the
payment of docket fees), the trial court's decision must still be annulled for having been
rendered without any jurisdiction.
The trial court lacked jurisdiction because no concrete and convincing evidence supported its
decision to grant Lasala's counterclaim. The CA noted that the trial court awarded Lasala an
exorbitant amount of P52,788,970.50, despite the absence of any supporting evidence other than
his self-serving testimony. Notably, Lasala did not present any corroborating documentary
evidence to support his counterclaim.
The Petition
Lasala submits that the NFA's use of a petition for relief at the trial court level should have
barred the NFA from filing a subsequent petition for annulment with the CA. At this point, res
judicata had already set in, thus prohibiting the CA from recognizing the NFA's petition for
annulment and its subsequent amended petition.15
Lasala also asserts that the NFA could no longer invoke extrinsic fraud as its basis for annulment,
since the NFA failed to raise this ground in its petition for relief. The NFA's omission amounted to
a waiver of the NFA's right to subsequently raise this ground in its petition for annulment. 16 And
even if extrinsic' fraud had been properly cognizable as a ground, the NFA still failed to prove it. 17
Lasala further argues that the NFA may not invoke the trial court's lack of jurisdiction over his
counterclaim for nonpayment of docket fees. His counterclaim is compulsory and is not
permissive; no docket fee is required to be paid.18
Lastly, Lasala posits that grave abuse of discretion is not a proper basis for granting a petition for
annulment of judgment. The only grounds allowed in the Rules of Court are extrinsic fraud and
lack of jurisdiction. Since these two grounds were not available to the NFA, then the CA's
annulment of the trial court's September 2, 2002 decision had no basis.
The Case for the NFA
The NFA argues that there was no res judicata between its petition for relief and petition for
annulment of judgment as these two reliefs were based on two different grounds. The petition
for relief was grounded on excusable negligence while the petition for annulment was based on
extrinsic fraud and lack of jurisdiction.19
Extrinsic fraud was employed against the NFA when its handling lawyers allowed its complaint
against Lasala to be dismissed, and when they failed to question the trial court's adverse ruling
through a motion for reconsideration or an appeal without any valid justification. 20
The trial court also lacked jurisdiction over Lasala's counterclaim because he failed to file the
required docket fees.21
Lastly, the NFA asserts that the CA did not err in annulling the trial court's September 2, 2002
decision, which granted Lasala's counterclaim, since the trial court ruling had no basis except
Lasala's self-serving testimony.22chanroblesvirtuallawlibrary
 The Court's Ruling
We resolve to DENY the petition.
The nature of a petition for
annulment of judgment
As a general rule, final judgments may no longer be modified as, after finality, all the issues
between the parties are deemed resolved and laid to rest. This rule embodies the principle that
at some point, litigation must end for an effective and efficient administration of justice. Hence,
once a judgment becomes final, the winning party should not, through subterfuge, be deprived of
the fruits of the verdict.23
In Antonino v. Register of Deeds of Makati,24 the Court explained the nature of a petition for
annulment of judgment and reiterated that it is only available under certain exceptional
circumstances, since it runs counter to the general rule of immutability of final
judgments, viz:cralawlawlibrary
Annulment of judgment is a recourse equitable in character, allowed only in exceptional
cases as where there is no available or other adequate remedy. Rule 47 of the 1997 Rules of Civil
Procedure, as amended, governs actions for annulment of judgments or final orders and
resolutions, and Section 2 thereof explicitly provides only two grounds for annulment of
judgment, i.e., extrinsic fraud and lack of jurisdiction. The underlying reason is traceable to
the notion that annulling final judgments goes against the grain of finality of judgment. Litigation
must end and terminate sometime and somewhere, and it is essential to an effective
administration of justice that once a judgment has become final, the issue or cause involved
therein should be laid to rest. The basic rule of finality of judgment is grounded on the
fundamental principle of public policy and sound practice that at the risk of occasional
error, the judgment of courts and the award of quasi-judicial agencies must become final
at some definite date fixed by law.25(emphasis supplied)chanrobleslaw
Since a petition for annulment of judgment is an equitable and exceptional relief, the Rules of
Court under Rule 47 put in place stringent requirements that must be complied with before this
remedy may prosper.
First, it is only available when the ordinary remedies of new trial, appeal, petition for relief, or
other appropriate remedies are no longer available through no fault of the petitioner.26
Second, an annulment may only be based on the grounds of extrinsic fraud and lack of
jurisdiction.Moreover, extrinsic fraud shall not be a valid ground if it was availed of, or could
have been availed of, in a motion for new trial or petition for relief.27
Lastly, if grounded on extrinsic fraud, the petition must be filed within four years from its
discovery; and if based on lack of jurisdiction, before it is barred by laches or estoppel.28
Guided by these requisites, we now discuss each related issue that the parties raised.
The prior filing of a petition for relief
does not per se bar the filing of a petition
for annulment of judgment.
Annulment of judgment may only be resorted to if the ordinary remedies of new trial, appeal,
petition for relief or other appropriate remedies, are no longer available without the
petitioner's fault.
Thus, the petitioner must be able to provide a plausible explanation for not resorting first to the
more common remedies enumerated under the Rules. As annulment is an equitable remedy, it
cannot be used to compensate litigants who lost their case because of their negligence or because
they slept on their rights. This safeguard has been put in place to address the concern that
defeated litigants would use and abuse Rule 47 to avoid or delay an already final and executory
judgment.29
In the present case, the NFA actually availed of the remedy of petition for relief at the trial court
level. Through Atty. Cahucom, the NFA, invoking the ground of excusable negligence, prayed that
the execution of the trial court's September 2, 2002 decision be restrained, and that its right to
appeal be recognized.30However, the trial court also dismissed this petition for being insufficient
in substance.
Lasala now argues that res judicata should have prevented the CA from recognizing the NFA's
petition for annulment, as the dismissal of the NFA's petition for relief serves as a prior judgment
that bars the filing of a subsequent petition for annulment of judgment.
Res judicata refers to the rule that a final judgment or decree on the merits by a court of
competent jurisdiction is conclusive of the rights of the parties or their privies in all later suits on
all points and matters determined in the former suit.
Its elements are the following: (1) the former judgment or order must be final; (2) the judgment
or order must be on the merits; (3) it must have been rendered by a court having jurisdiction
over the subject matter and the parties; and (4) there must be, between the first and the second
action, identity of parties, of subject matter, and cause of action.31 There is res judicata when
all these requisites concur.
Clearly, the fourth requisite is absent and cannot apply to the present case. There is identity
of parties in the petitions for relief and annulment of judgment, but no identity of subject matter
and cause of action.
To determine the existence of identity of cause of action between the two cases, the Court has
often applied the identity of evidence test -i.e., whether the evidence to support and establish the
present and former causes of action are the same.
The petition for relief prayed that the execution of the trial court's adverse ruling be restrained,
and for the recognition of the NFA's right to appeal on the ground of excusable negligence. 32 On
the other hand, the petition for annulment and its amendment sought the setting aside of the
trial court's decision because of extrinsic fraud and lack of jurisdiction. 33
Clearly, the pieces of evidence that NFA presented in its petition for relief are different from the
evidence it presented in the current case - the former, grounded on excusable negligence, sought
relief from judgment because one of its employees failed to give a copy of the trial court decision
to Atty. Cahucom on time to file an appeal.
The present case, on the other hand, seeks to annul the trial court's judgment based on the
fraudulent acts of its former counsels (including Atty. Cahucom's), and because the lower court
lacked jurisdiction over Lasala's counterclaim.
The distinctions between the grounds invoked and reliefs prayed for between the two
petitions highlight the need for different pieces of evidence to prove them. Thus, their
causes of action are not identical, and res judicata does not bar the filing of the present
petition for annulment.
Only two grounds may be recognized
in a petition for annulment: extrinsic fraud
and lack of jurisdiction.
Because it is an exceptional relief, the Rules provide that only two grounds may be availed of in a
petition for annulment. These are extrinsic fraud and lack of jurisdiction.
In the present case, the CA annulled the trial court's decision granting Lasala's counterclaim as
the RTC ruling was not supported by any concrete and convincing evidence. According to the CA,
the RTC effectively acted without jurisdiction. CA Associate Justice Rosmari Carandang fully
communicated the sense of the majority's ruling in her concurring opinion,34 when she held that
the trial court committed an error of judgment and acted beyond its lawful jurisdiction when it
relied solely on Lasala's self-serving testimony. Otherwise stated, the trial court committed grave
abuse of discretion amounting to lack of jurisdiction when it rendered a decision that was not
supported by factual and evidentiary basis.35
We rule that the CA committed an error; it violated the restrictive application of a petition for
annulment; only extrinsic fraud and/or lack of jurisdiction may annul a final judgment.
By seeking to include acts committed with grave abuse of discretion, the CA's ruling enlarged the
concept of lack of jurisdiction as a ground for annulment.36 Moreover, grave abuse of discretion
is properly addressed not through a Rule 47 relief but through a Rule 65 petition
for certiorari. Since the NFA availed of a petition for annulment of judgment, then the CA's
disposition must also be confined to findings on the existence of either extrinsic fraud or the trial
court's lack of jurisdiction over the parties or the subject matter as explained below.
In a petition for annulment based on lack of jurisdiction, the petitioner cannot rely on
jurisdictional defect due to grave abuse of discretion, but on absolute lack of jurisdiction. As
we have already held, the concept of lack of jurisdiction as a ground to annul a judgment
does not embrace grave abuse of discretion amounting to lack or excess of
jurisdiction.37 In Republic v. G Holdings,38 we explained:cralawlawlibrary
Jurisdiction is not the same as the exercise of jurisdiction. As distinguished from the exercise of
jurisdiction, jurisdiction is the authority to decide a cause, and not the decision rendered
therein. Where there is jurisdiction over the person and the subject matter, the decision on
all other questions arising in the case is but an exercise of the jurisdiction. And the errors
which the court may commit in the exercise of jurisdiction are merely errors of judgment
which are the proper subject of an appeal.39 (emphasis supplied)chanrobleslaw
In other words, the lack of jurisdiction envisioned under Rule 47 is the total absence of
jurisdiction over the person of a party or over the subject matter. When the court has validly
acquired its jurisdiction, annulment through lack of jurisdiction is not available when the court's
subsequent grave abuse of discretion operated to oust it of its jurisdiction.
Despite this erroneous ruling of the CA, we hold that annulment of the trial court's September 2,
2002 decision is still proper as the NFA validly raised and substantiated the allowed grounds of
extrinsic fraud and lack of jurisdiction.

a. Extrinsic fraud
Extrinsic fraud in a petition for annulment refers to "any fraudulent act of the prevailing party in
litigation committed outside of the trial of the case, where the defeated party is prevented from fully
exhibiting his side by fraud or deception practiced on him by his opponent, such as by keeping him
away from court, by giving him a false promise of a compromise, or where an attorney
fraudulently or without authority connives at his defeat."40
Because extrinsic fraud must emanate from the opposing party, extrinsic fraud concerning a
party's lawyer often involves the latter's collusion with the prevailing party, such that his lawyer
connives at his defeat or corruptly sells out his client's interest.41
In this light, we have ruled in several cases42 that a lawyer's mistake or gross negligence does not
amount to the extrinsic fraud that would grant a petition for annulment of judgment.
We so ruled not only because extrinsic fraud has to involve the opposing party, but also because
the negligence of counsel, as a rule, binds his client.43
We have recognized, however, that there had been instances where the lawyer's negligence had
been so gross that it amounted to a collusion with the other party, and thus, qualified as extrinsic
fraud.
In Bayog v. Natino,44 for instance, we held that the unconscionable failure of a lawyer to inform his
client of his receipt of the trial court's order and the motion for execution, and to take the
appropriate action against either or both to protect his client's rights amounted to connivance
with the prevailing party, which constituted extrinsic fraud.45
Two considerations differentiate the lawyer's negligence in Bayog from the general rule
enunciated in Tan. While both cases involved the lawyer's negligence to inform the client of a
court order, the negligence in Bayog was unconscionable because the (1) the client's pauper
litigant status indicated that he relied solely on his counsel for the protection and defense of his
rights; and (2) the lawyer's repeated acts of negligence in handling the case showed that his
inaction was deliberate.
In contrast, the Court ruled in Tan that the petitioner's failure to file a notice of appeal was partly
his fault and not just his lawyer's. Too, the failure to file the notice of appeal was the only act of
negligence presented as extrinsic fraud.
We find the exceptional circumstances in Bayog to be present in the case now before us.
The party in the present case, the NFA, is a government agency that could rightly rely solely on
its legal officers to vigilantly protect its interests. The NFA's lawyers were not only its counsel,
they were its employees tasked to advance the agency's legal interests.
Further, the NFA's lawyers acted negligently several times in handling the case that it appears
deliberate on their part.
First, Atty. Mendoza caused the dismissal of the NFA's complaint against Lasala by negligently
and repeatedly failing to attend the hearing for the presentation of the NFA's evidence-in-chief.
Consequently, the NFA lost its chance to recover from Lasala the employee benefits that it
allegedly shouldered as indirect employer.
Atty. Mendoza never bothered to provide any valid excuse for this crucial omission on his part.
Parenthetically, this was not the first time Atty. Mendoza prejudiced the NFA; he did the same
when he failed to file a motion for reconsideration and an appeal in a prior 1993 case where
Lasala secured a judgment of P34,500,229.67 against the NFA.46
For these failures, Atty. Mendoza merely explained that the NFA's copy of the adverse decision
was lost and was only found after the lapse of the period for appeal.47 Under these
circumstances, the NFA was forced to file an administrative complaint against Atty. Mendoza for
his string of negligent acts.
Atty. Cahucom, Atty. Mendoza's successor in handling the case, notably did not cross-examine
Lasala's witnesses, and did not present controverting evidence to disprove and counter Lasala's
counterclaim. Atty. Cahucom further prejudiced the NFA when he likewise failed to file a motion
for reconsideration or an appeal from the trial court's September 2, 2002 decision, where Lasala
was awarded the huge amount of P52,788,970.50, without any convincing evidence to support it.
When asked to justify his failure, Atty. Cahucom, like Atty. Mendoza, merely mentioned that the
NFA's copy of the decision was lost and that he only discovered it when the period for appeal had
already lapsed.48
The trial court's adverse decision, of course, could have been avoided or the award minimized, if
Atty. Cahucom did not waive the NFA's right to present its controverting evidence against
Lasala's counterclaim evidence. Strangely, when asked during hearing, Atty. Cahucom refused to
refute Lasala's testimony and instead simply moved for the filing of a
memorandum.49chanroblesvirtuallawlibrary

The actions of these lawyers, that at the very least could be equated with unreasonable
disregard for the case they were handling and with obvious indifference towards the
NFA's plight, lead us to the conclusion that Attys. Mendoza's and Cahucom's actions
amounted to a concerted action with Lasala when the latter secured the trial court's huge
and baseless counterclaim award. By this fraudulent scheme, the NFA was prevented from
making a fair submission in the controversy.
To further invalidate the NFA's petition for annulment, Lasala argues that extrinsic fraud as a
ground is no longer available since the NFA failed to raise it in its petition for relief when it could
have done so. Under Section 2, Rule 47 of the Rules of Court, extrinsic fraud as a ground will not
be allowed if it had already been availed of or could have been availed of in a motion for
new trial or petition for relief. Attys. Mendoza and Cahucom's actions which amounted to
extrinsic fraud should have been earlier raised at the trial court's level since their actions had
been consummated when the petition for relief was filed. The NFA's failure to do so amounted to
a waiver of this ground in its petition for annulment.
We find Lasala's reasoning to be grossly erroneous.
The NFA did not waive its right to raise extrinsic fraud precisely because the circumstances
prevented its inclusion in the petition for relief. Notably, Atty. Cahucom was the one who
drafted and filed the petition for relief, which he based not on his own negligence, but on
that of another NFA employee.
Since part of the extrinsic fraud against the NFA was attributable to Atty. Cahucom, it could not
be expected that he would raise his own act as a ground and incriminate himself in the petition
for relief. In our analysis, the NFA could not have availed of this ground because Atty. Cahucom
himself prevented it.
Moreover, it was only in 2002, when then NFA Administrator Arthur Yap ordered a legal audit of
all existing NFA cases, that the NFA's management discovered the mishandling of the case
against Lasala.
In these lights, we rule that the prohibition under Section 2, Rule 47 should not apply to the NFA.
Although available during the filing of the petition for relief, the NFA could not have raised this
ground because it was fraudulently precluded from doing so.
Thus, the actions of Attys. Mendoza and Cahucom, under the unique circumstances of this
case, amount to extrinsic fraud that warrants the grant of NFA's petition for relief from
judgment.
b. Lack of jurisdiction over the subject matter
Moreover, the trial court's September 2, 2002 decision should also be annulled on the ground of
lack of jurisdiction.
Notably, Lasala's counterclaim was not only based on the damages that he incurred because of
the trial court's invalid issuance of a writ of preliminary attachment against his properties. A big
chunk of the award which amounted to P1,623,600.00 pertained to Lasala's other claims against
the NFA, specifically the wage adjustment against the NFA for the security guard services his
agency rendered from April 16, 1988 to April 15, 1989.
This amount further ballooned when the trial court granted Lasala's prayer for interest at
3% per month or 36% per year. Compounded until the year 1999, the interest due on such
wage adjustment amounted to P35,165,370.50, which is almost 67% of the trial court's total
counterclaim award. Lasala paid no docket fees on this counterclaim, reasoning that it is in the
nature of a compulsory counterclaim.
We do not agree with Lasala's position.
A compulsory counterclaim is any claim for money or other relief that a defending party may
have against an opposing party, which at the time of suit arises out of, or is necessarily
connected with, the same transaction or occurrence that is the subject matter of the
plaintiff's complaint. It is compulsory in the sense that it is within the jurisdiction of the court,
does not require for its adjudication the presence of third parties over whom the court cannot
acquire jurisdiction, and will be barred if not set up in the answer to the complaint in the same
case.50
To determine if a counterclaim is compulsory, the following tests apply: (a) Are the issues of fact
and law raised by the claim and by the counterclaim largely the same?; (b) Would res
judicata bar a subsequent suit on defendant's claims, absent the compulsory counterclaim rule?;
(c) Will substantially the same evidence support or refute plaintiffs claim as well as the
defendant's counterclaim?; and (d) Is there any logical relation between the claim and the
counterclaim? A positive answer to all four questions would indicate that the counterclaim is
compulsory.51 Otherwise, it is permissive.
In these lights, we rule that Lasala's counterclaim for wage adjustment against the NFA is not a
compulsory but a permissive counterclaim. The cause of action for this counterclaim already
existed even before the filing of the NFA's complaint against Lasala. Thus, it did not arise
out of, nor is it necessarily connected with, the NFA's complaint for sum of money and
prayer for preliminary attachment. Because it is not an incident of the NFA's claim, it can be
filed as a separate case against the NFA, unless already extinguished.
Under this situation, Lasala's nonpayment of docket fee for his permissive counterclaim
prevented the trial court from acquiring jurisdiction over it. The court may allow payment of
such fee but only within a reasonable time and in no case beyond the prescriptive period for the
filing of the permissive counterclaim.52
As it was based on the parties' security service contract, the prescriptive period for Lasala's
counterclaim is 10 years.53 Lasala's cause of action accrued in 1989, when the contract with the
NFA was executed. Since no docket fee was paid even after the lapse of 10 years, then the trial
court never acquired jurisdiction over Lasala's wage adjustment counterclaim. Thus, with regard
to this counterclaim, annulment of the trial court's judgment is proper.
Lasala's permissive counterclaim
has already prescribed and may no longer
be refiled.
While Section 7, Rule 4754 of the Rules of Court provides that an annulment of judgment renders
the assailed judgment, resolution, or final order null and void, the original action may still be
refiled in the proper court. This rule applies in instances where the judgment is annulled because
of lack of jurisdiction. In such cases, the defeated party may sti11 refile the original action in the
court that has jurisdiction, provided it has not yet prescribed.
In cases of extrinsic fraud, the party who is defrauded and prevented from fully exhibiting his
side may file a motion in court to present his evidence as if a timely motion for new trial had
been granted.
In the present case, we annulled the trial court's decision granting Lasala's permissive
counterclaim on both grounds of lack of jurisdiction and extrinsic fraud.
Although the prescriptive period for the refiling of the annulled action shall be deemed
suspended from its original filing until the finality of the judgment of annulment, we rule that
Lasala may no longer refile his permissive counterclaim as it has already prescribed.
Under Section 8, Rule 47, the prescriptive period to file the annulled original action shall not be
suspended when the extrinsic fraud is attributable to the plaintiff in the action. 55 In the present
case, the original action contemplated is Lasala's counterclaim against the NFA.
On this basis, we hold that the existence of extrinsic fraud in the present case did not toll the
prescriptive period for the filing of Lasala's counterclaim.
To reiterate, the unique facts of this case show that Attys. Mendoza and Cahucom patently,
blatantly, and unjustifiably mishandled the case to the utter prejudice of the NFA. The degree to
which they disregarded their duty to protect the NFA's interests amounted to actions in
concert with Lasala which constituted the extrinsic fraud against the NFA.56
In sum, not only do we set aside the trial court's judgment award of P52,788,970.50 to Lasala for
being null and void; we also categorically hold that Lasala's cause of action has prescribed, and
thus, may no longer be refiled.
On a final note, we observe that the NFA's petition for annulment of judgment, whether
grounded on extrinsic fraud or lack of jurisdiction, was filed within the allowed periods provided
for in the Rules. As the NFA substantiated the required grounds for annulment, we affirm the
CA's decision annulling the September 2, 2002 decision of the trial court.
Potential liabilities of Attys.
Mendoza and Cahucom
The records of the case show that the NFA had conducted initial investigations against Attys.
Mendoza and Cahucom for potential administrative and criminal liabilities.
We are forwarding a copy of the records of this case to the Ombudsman to assist it in
determining the administrative and criminal liabilities of these public officers.
We likewise furnish the Board of Governors of the Integrated Bar of the Philippines a copy of this
Decision and the records of this case so that they may conduct the appropriate investigation
regarding Atty. Mendoza's and Atty. Cahucom's fitness to remain as members of the Bar.
Lest it be misunderstood, the Court's ruling in this case involves solely the finding of extrinsic
fraud for purposes of granting the NFA relief from judgment; the Ombudsman and the Board of
Governors are tasked to conduct their own investigations regarding the incidents surrounding
this case, with this Decision and its records to be considered as part of evidence, to determine the
potential liabilities of Attys. Mendoza and Cahucom.
WHEREFORE, premises considered, we hereby DENY the petition for lack of merit,
and AFFIRM with modification the June 14, 2005 Decision and February 15, 2006 Resolution of
the Court of Appeals in CA-G.R. SP No. 73235 (which annulled and set aside the September 2,
2002 decision of the Regional Trial Court of Quezon City, Branch 220).

Let a copy of this Decision and the records of this case be furnished the Office of the Ombudsman
for whatever action it may deem appropriate against Attys. Rogelio B. Mendoza and Ernesto D.
Cahucom under the circumstances defined in this Decision.

Let a copy of this Decision and the records of this case also be sent to the Board of Governors of
the Integrated Bar of the Philippines for its administrative investigation of Attys. Rogelio B.
Mendoza and Ernesto D. Cahucom, based on the given facts of this Decision, in the interest of
determining whether these members of the Bar still have the requisite competence and integrity
to maintain their membership in the roll of lawyers of this country.

SO ORDERED.chanroblesvirtuallawlibrary
 SECOND DIVISION plaintiffs, who have substituted for DBP as creditors:chanRoblesvirtualLawlibrary

G.R. No. 202611, November 23, 2015 1. The parcel of land covered by TCT No. 6337 with all the improvements thereon; x x x

ABNER MANGUBAT, Petitioner, v. BELEN MORGA-SEVA, Respondent. xxxx

SO ORDERED.4ChanRoblesVirtualawlibrary
DECISION cralawlawlibrary

DEL CASTILLO, J.:

Since Belen and her co-defendants' appeal to the CA and later to this Court were both
unsuccessful, the RTC Decision became final and executory.
This Petition for Review on Certiorari assails the Resolutions of the Court of Appeals (CA) dated
(i) July 13, 20111 which dismissed for lack of merit petitioner Abner Mangubat's (Abner) Petition
On September 3, 1998, Gaudencio and his children as heirs (the heirs) of the deceased Aurelia
for Annulment of Judgment and, (ii) June 13, 20122 which denied his motion for reconsideration.
filed with the same court a Complaint for Revival of the Decision in Civil Case No. P-279.5 They
averred that the writ of execution could not be implemented because Belen and her co-
Factual Antecedents
defendants evaded service thereof. And since five years had already lapsed from the date of its
entry, Gaudencio and the heirs prayed for the revival of the RTC Decision.
On March 5, 1974, Gaudencio Mangubat (Gaudencio) and his wife Aurelia Rellora-Mangubat
(Aurelia) filed with the Regional Trial Court (RTC) of Pili, Camarines Sur a Complaint for Specific
Gaudencio, assisted by Atty. Reynaldo L. Herrera (Atty. Herrera) and Belen by Atty. Junnel M.
Performance with Damages against respondent Belen Morga-Seva (Belen) and two other
Relativo, entered into a Compromise Agreement6 which states as
defendants. The case was docketed as Civil Case No. P-279 and raffled to the RTC Branch 31. On
follows:chanRoblesvirtualLawlibrary
August 27, 1985, the RT.C issued a Decision,3 the dispositive portion of which reads in
part, viz.:chanRoblesvirtualLawlibrary
xxxx
Based on the facts x x x established x x x and the cited applicable law and jurisprudence, this
The defendants admit that they shall pay the amount of P33.OOO.OO that was previously paid by
Court hereby renders judgment and orders:chanRoblesvirtualLawlibrary
the plaintiffs to [the DBP1 prior to the issuance of the decision in Civil Case No. 279, plus its legal
interest of 12% per annum since August [1990 until] the year 2000 or a total sum of P72,600.00
xxxx
plus P5,000.00 for attorney's fee, payable on or before June 30, 2001;
3. The defendants to reimburse the plaintiffs the total amount the latter have paid the
That upon payment of said amount, the plaintiffs will transfer the title, TCT No. 6337 to
(Development Bank of the Philippines [DBP]) after 1971, the year the defendants defaulted in
defendant Belen Morga Seva;
their amortization payments to DBP, and in the event of the failure of the defendants to make
such reimbursement, for plaintiffs to assume the rights of the old creditor (DBP) and take such
All other claims and counterclaims that the parties may have [against each other] are hereby
remedial action as the situation may warrant, x x x
waived.
xxxx
x x x x7cralawlawlibrary
5. The defendants [are] entitled to claim and recover title or ownership over the following
The RTC approved8 the agreement and on February 23, 2001 rendered a Decision9 in accordance
properties held as collaterals by DBP, subject, however, to the encumbrance in favor of the
therewith. Upon its finality, the Writ of Execution was ordered issued by the said court. 10

On June 24, 2002, Abner, on his own behalf, moved to substitute his father Gaudencio who died
on January 31, 2002.11 A few months thereafter and now allegedly in behalf of his co-heirs,
Abner, through Atty. Haide B. Vista-Gumba (Atty. Vista-Gumba) filed another motion to
substitute Gaudencio exclusively for the purpose of executing the final judgment in the case on
the claim that it was necessary for the settlement of the intestate estate of his father. 12 In an
Order13 dated September 13, 2002, the RTC granted Abner's motion for substitution but for
purposes of execution only.
On December 18, 2003, Belen handed to Atty. Herrera her payment of P91,280.0014 in
accordance with the Compromise Agreement.15 Alleging, however, that the heirs refused to
convey to Belen the lot covered by TCT No. 6337, the RTC, upon motion of Atty.
Herrera,16 directed (1) Abner, who was allegedly in possession of the owner's copy of the title, to
surrender the same to the Clerk of Court; and (2) the Clerk of Court to execute in behalf of the
heirs a deed of sale or conveyance of the lot in favor of Belen pursuant to Sec. 10, Rule 39 of the
Rules of the Court.17 Abner, however, manifested that as far as he is concerned, Belen has not yet
made any payment to the heirs as he was not notified by Atty. Herrera of the same.18 Thus, Atty.
Herrera reported to the court that out of the P91,280.00 handed to him by Belen, he had turned-
over the amount of P84,480.00 to the Clerk of Court and retained 6,800.00 as his attorney's
fee.19 This was duly noted by the RTC.20
On January 20, 2005, Abner terminated the services of Atty. Herrera.21 Subsequently and
purportedly in behalf of all the heirs, Abner, through Atty. Vista-Gumba, filed a Motion to Declare
the Amicable Settlement Null and Void.22 It was alleged therein that Gaudencio acted only on his
own behalf when he entered into the compromise agreement with Belen, hence, the same is null
and void for want of consent and participation of the heirs who were indispensable parties.
Interestingly, however, two of the heirs namely, Ruth Mangubat Parcia and Job Mangubat filed a
Manifestation with Motion to Withdraw the Heirs['] Respective Shares.23 According to them, they
were seven siblings all in all and each is entitled to P12,068.00 from Belen's payment. They do
not agree with the course of action taken by Abner relative to the case and prayed that the case
be considered closed and terminated and their respective shares from Belen's payment released
to them. Belen, on the other hand, questioned Abner's capacity to assail the compromise
agreement. She averred that in the decision of the probate court regarding the intestate estate of
Gaudencio, Abner was disinherited by his father.24
In an Order25 dated September 8, 2005, the RTC ruled on the Motion to Declare the Amicable
Settlement Null and Void as follows:chanRoblesvirtualLawlibrary
The present action for Declaration of Nullity of the Compromise Agreement was filed by Abner
Mangubat, son and one. of the heirs of Gaudencio and Aurelia Mangubat, who has been
disinherited by final judgment in Spec. Procs. No. P-984 before RTC[,] Branch 33 of this Court x x
x thus, Abner Mangubat is not a real party in interest to bring this present action ([to] declare
[the] amicable settlement null and void] under Rule 3, Section 2 of the Rules of Court. His
allegations that the present motion was brought in behalf of the other heirs of Gaudencio and
Aurelia Mangubat is gratuitous and without basis, there is no evidence to show that he is
authorized to represent them. As a matter of fact, two of the heirs, Ruth Mangubat Parcia and Job
Mangubat manifested that they do not want to be involved and dragged in this proceeding nor in
any other action that Abner may institute; that accordingly, they are satisfied with the decision of
the Court, and they want to get their share of the deposit x x x.
Be it noted that the decision has been partially satisfied when defendant Belen Morga Seva, thru
Atty. Reynaldo Herrera, deposited the amount of P84,480.00 to the Clerk of Court as per
[R]eceipt No. 1201439 dated April 6, 2005. Moreover, by his own act, Abner Mangubat is bound
by the compromise agreement when he substituted for his father. Record shows that Abner
Mangubat continued to retain the legal services of Atty. Reynaldo Herrera as counsel for the
plaintiffs contrary to his allegations. The services of Atty. Herrera was terminated only sometime
in January 2005. x x x
It is well settled that a judgment on a compromise is not appealable and is immediately
executory, unless a motion is filed to set aside the compromise on the ground of fraud, mistake or
duress in which case an appeal may be taken from the order denying the motion.
The inaction of Abner Mangubat or [the] other heirs of Gaudencio Mangubat and Aurelia
Mangubat for a period of almost four (4) years after becoming aware of the compromise
agreement and of the judgment thereon, amounts to a ratification on their part of said
agreement. For laches operates to validate an agreement otherwise invalid, granting that the
herein compromise agreement was invalid, when the party on becoming aware of the
compromise fails to repudiate it promptly. Such ratification is presumed from his or their
inaction.
The validity of a judgment or order of a Court cannot be assailed collaterally unless the ground of
attack is lack of jurisdiction. If the purported nullity of the judgment lies on the party's lack of
consent to the compromise agreement, as claimed by Abner Mangubat being the heir of Aurelia
Rellora-Mangubat who died before the filing of this case for revival of judgment, the remedy of
the aggrieved party is to have it reconsidered, and if denied to appeal from such judgment or if
final to apply for relief under Rule 38 of the Rules of Court or to file an annulment of judgment
under Sec. 9 of B.P. 129 before the Honorable Court of Appeals.

It is unfortunate that Abner Mangubat failed to avail of the remedies provided for under the
Rules of Court and opted to file this instant motion to declare the compromise agreement null
and void which has no leg to stand on.
WHEREFORE, in view of all the foregoing, for lack of sufficient merit, the motion to declare [the]
amicable settlement null and void is hereby DENIED.
SO ORDERED.26cralawlawlibrary
Again purportedly on behalf of all the heirs, Abner moved for the reconsideration of the above-
quoted Order27 but was denied by the RTC in its Order28 of February 27, 2006. When the same
became final, Belen filed a Motion for Execution of Specific Acts 29 wherein she once more prayed
that Abner be ordered to surrender to the RTC the owner's copy of TCT No. 6337 and the Clerk of
Court to execute in her favor and on behalf of the heirs a deed of sale involving the lot covered by
the said title. This was granted by the RTC in an Order30 dated July 14, 2006. Still, Abner refused
to comply. Hence, the said court upon motion of Belen31 issued its Order32 of September 25,
2006, the dispositive portion of which reads:chanRoblesvirtualLawlibrary
WHEREFORE, in view of the foregoing, plaintiffs through Abner Mangubat [are] hereby divested
of the ownership of the property covered by Transfer Certificate of Title No. 6337 pursuant to
the decision of this Court dated February 23, 2001 and the same is vested to herein defendant
Belen Morga-Seva. This order shall now have the force and effect of a conveyance executed in
due form oflaw pursuant to the last sentence of Sec. 10(a) of Rule 39 of the [R]ules of Court.
SO ORDERED.33ChanRoblesVirtualawlibrary
cralawlawlibrary
Trie afore-mentioned order became final on November 19, 2006.34 Pursuant thereto, the RTC
directed the Registrar of Deeds of Camarines Sur to transfer title to the property under TCT No.
6337 to Belen.35
Riding of the Court of Appeals
On September 21, 2010, Abner filed a Petition for Annulment of Final Order36 with the CA. He
contended that under the Compromise Agreement, Belen was supposed to make her payment on
or before June 30, 2001. However, the same was made only on December 18, 2003 or way
beyond the period agreed upon. Thus to Abner, it was unjust for the RTC to have issued its
September 25, 2006 Order divesting the heirs of ownership of the subject property. Moreover,
Abner argued that since the February 23, 2001 RTC Decision approving the Compromise
Agreement had long become final and executory, the RTC had already lost its jurisdiction over
the case when it issued the September 25, 2006 Order.
In a Resolution37 dated July 13, 2011, the CA dismissed the Petition for lack of merit. The Motion
for Reconsideration38 thereto was also denied in Resolution39 dated June 13, 2012.
Hence, this Petition for Review on Certiorari.
The Parties' Arguments
Abner basically reiterates the arguments he advanced before the CA.
For her part, Belen argues that the RTC has jurisdiction over the Complaint for revival of
judgment. In fact, the RTC's issuance of the September 25, 2006 Order is nothing but an exercise
of jurisdiction pursuant to its authority to handle the case until the full satisfaction of its
Decision. At any rate, Abner is guilty of laches as it was only after almost four years from the
finality of the said Order that he questioned the same.
Our Ruling
The Petition fails.
It must be stressed that the remedy of annulment of judgment is only available under certain
exceptional circumstances as this is adverse to the concept of immutability of final
judgments.40 Hence, it is allowed only on two grounds, i.e., extrinsic fraud and lack of
jurisdiction.41
Abner anchors his Petition for Annulment of Final Order on lack of jurisdiction. He posits that the
RTC had lost jurisdiction over the case when its February 23, 2001 Decision became final, hence,
any issuance subsequent thereto is made without any jurisdiction.
The argument is, however, specious. "Lack of jurisdiction on the part of the trial court in
rendering the judgment or final order is either lack of jurisdiction over the subject matter or
nature of the action, or lack of jurisdiction over the person of the petitioner." 42 Here, it is
undisputed that the RTC acquired jurisdiction over the person of Abner, he having asked for
affirmative relief therefrom several times.43 As mentioned, what Abner questions is the RTC's
jurisdiction over the case.
"In a petition for annulment of judgment based on lack of jurisdiction, petitioner must show not
merely an abuse of jurisdictional discretion but an absolute lack of jurisdiction. Lack of
jurisdiction means absence of or no jurisdiction, that is, the court should not have taken
cognizance of the petition because the law does not vest it with jurisdiction over the subject
matter. Jurisdiction over the nature of the action or subject matter is conferred by law." 44 The
RTC's jurisdiction over petitions for revival of judgment had already been upheld by the
Court.45 It was held that "[a]n action for revival of judgment may be filed either 'in the same court
where said judgment was rendered or in the place where the plaintiff or defendant resides, or in
any other place designated by the statutes which treat of the venue of actions in general.'" 46 Here,
the Complaint for revival of judgment was filed in the same court (RTC-Pili Camarines Sur,
Branch 31) which rendered the August 27, 1985 Decision in Civil Case No. P-279. Undoubtedly,
the RTC has jurisdiction over the action. There is therefore no valid ground for the Petition for
Annulment of Final Order that Abner filed with the CA.
To the mind of the Court, Abner's flawed arguments emanate from his misconception of lack of
jurisdiction over the subject matter or nature of the action as a ground for annulment. As aptly
observed by the CA, he has confused lack of jurisdiction with error in the exercise of
jurisdiction, viz.:chanRoblesvirtualLawlibrary
It is settled that once jurisdiction has been acquired, it is not lost until the court shall have
disposed of the case in its entirety. [Abner's] predecessor having elected to enforce the
compromise agreement, the RTC is still vested with jurisdiction until compliance therewith has
been fully enforced.
if based on lack of jurisdiction, must brought before it is barred by laches.48 "The principle of
laches or 'stale demands' ordains that the failure or neglect, for an unreasonable and
unexplained length of time, to do that which by exercising due diligence could or should have
been done earlier ~ negligence or omission to assert a right within a reasonable time, warrants a
presumption that the party entitled to assert it has abandoned it or declined to assert it." 49 In this
case, it was only after almost four years from the finality of the September 25, 2006 Order that
Abner brought an action to annul the same. He did not even care to provide in his petition any
justification for his inaction for such a long period of time. Such unreasonable delay warrants the
presumption that Abner has declined to assert his right to the property covered by TCT No. 6337.
Verily, to permit him now to assert the same would be unfair and inequitable.
In any event, Abner's Petition for Annulment of Final Order was not the proper remedy to nullify
the September 25, 2006 Order which is an interlocutory order. "An interlocutory order refers to
a ruling respecting some point or matter between the commencement and end of the suit, but is
not a final adjudication of the claims and liabilities of the parties that are in dispute in that
suit.50 The September 25, 2006 Order merely dealt with the incidental matter of causing the
transfer of the title to the property covered by TCT No. 6337 under the name of Belen in
accordance with the final and executory February 23, 2001 RTC Decision after Abner refused to
comply with the directive to deliver the owner's copy thereof. No further settlement of any claim
or imposition of any further liability was made in the said order.
WHEREFORE, the Petition for Review on Certiorari is DENIED. The assailed Resolutions of the
Court of Appeals dated July 13, 2011 and June 13, 2012 are AFFIRMED.

[Abner] clearly confused lack of jurisdiction with error in the exercise of jurisdiction. Jurisdiction SO ORDERED.
is not the same as the exercise of jurisdiction. As distinguished from the exercise of jurisdiction,
jurisdiction is the authority to decide a case, and not the decision rendered therein. Where there
is jurisdiction over the person and the subject matter, the decision on all other questions arising
in the case is but an exercise of such jurisdiction. And the errors which the court may commit in
the exercise of jurisdiction are merely errors of judgment which are the proper subject of an
appeal. The error raised by [Abner] pertains to the trial court's exercise of its jurisdiction, not its
lack of authority to decide the case. In a petition for annulment of judgment based on lack of
jurisdiction, [a] petitioner must show not merely an abuse of jurisdictional discretion but an
absolute lack of authority to hear and decide the case. On this basis, there would be no valid
ground to grant the petition for annulment of judgment.47ChanRoblesVirtualawlibrary
cralawlawlibrary

Even assuming that the claim of lack of jurisdiction is well-grounded, Abner's Petition for
Annulment of Final Order is barred by laches. An action for annulment of judgment or final order
 THIRD DIVISION and

G.R. No. 197825, January 11, 2016 3. The Defendants to pay to the .Plaintiffs the amount of Fifteen Thousand Pesos as moral and
actual damages.
CAMILO SIBAL, Petitioner, v. PEDRO BUQUEL, SANTIAGO BUQUEL, JR., ROSALINDA BUQUEL,
REPRESENTED BY FRANCISCO BUQUEL, Respondents. SO ORDERED.4cralawlawlibrary

DECISION Thereafter, said RTC Decision became final and executory; hence, the trial court issued a writ of
execution.
PERALTA, J.:
On August 8, 2008, Sibal filed a Petition for Annulment of the RTC Decision before the CA, where
he raised lack of jurisdiction and extrinsic fraud as grounds. On March 16, 2011, the CA
Before the Court is a Petition for Review under Rule 45 of the Rules of Court which petitioner
dismissed Sibal's petition, thus: '
Camilo Sibal filed, assailing the Decision1 of the Court of Appeals (CA), dated March 16, 2011, and
its Resolution2dated July 7, 2011 in CA-G.R. SP NO. 104774. The CA affirmed the Decision3 of the
WHEREFORE, premises considered, the instant petition is hereby DISMISSED for lack of merit.
Regional Trial Court (RTC) of Tuguegarao City, Cagayan, Branch 02, dated January 5, 2007, in
Civil Case No. 6429.
SO ORDERED.5cralawlawlibrary
The facts, as gathered from the records, are as follows:chanRoblesvirtualLawlibrary
Sibal filed a Motion for Reconsideration, but the same was denied. Thus, he filed the instant
petition.
Respondents Pedro Buquel, Santiago Buquel, Jr., Rosalinda Buquel and Francisco Buquel
inherited from their parents, Santiago Buquel, Sr. and Faustina Buquel, a parcel of land consisting
Sibal maintains that the RTC did not acquire jurisdiction over the case and that the Buquels were
of 81,022 sq. m. covered by Original Certificate of Title No. 0-725. Sometime m January 1999,
guilty of extrinsic fraud.
petitioner Camilo Sibal and Tobi Mangoba took possession of a portion of the property which
belonged to Santiago, Sr. Thereafter, the Buquels made several demands against Sibal and
The petition is devoid of merit.
Mangoba for them to vacate and turn over the property, but the latter refused to do so. Hence,
they filed a complaint before the Tuguegarao RTC for recovery of possession and damages.
Sibal contends that the RTC Decision should be annulled on the ground that the RTC never
acquired jurisdiction over the case as the complaint filed merely alleged that ^ the value of the
On January 5, 2007, the Tuguegarao RTC ruled in favor of the Buquels, the decretal portion of the
subject property is P51,190.00, without, however, categorically mentioning its assessed value,
Decision provides:chanRoblesvirtualLawlibrary
and only the real property tax order of payment was attached to the complaint and not the tax
declaration that would determine the assessed value of the property. But, upon review of the
WHEREFORE, in the light of the foregoing, the Court hereby renders judgment in favor of the
records, the Court notes that the Real Property Tax Order of Payment Mo. 091-05713-03 dated
Plaintiffs Pedro Buquel, Santiago Buquel, Jr., Rosalinda Buquel, and Francisco Buquel as against
November 24, 2002, or "Exhibit C," shows that the amount of P51,190.00 is truly the assessed
Defendants Camilo Sibal and Tobi Mangoba ordering:chanRoblesvirtualLawlibrary
value of the property, which fact Sibal failed to refute.
1 .The restoration to Plaintiffs of their peaceful possession of the land in question, specifically on
A petition for annulment of judgment is a remedy in equity so exceptional in nature that it may
the share of Santiago Buquel, Jr.;
be availed of only if the judgment, final order, or final resolution sought to be annulled was
rendered by a court lacking jurisdiction or through extrinsic fraud, and only when other
2. The Defendants to pay the plaintiffs the amount of Fen Thousand Pesos for Attorney's Fees;
remedies are wanting.6 In the present case, Sibal was able to avail of other remedies when he
filed before the RTC a motion to quash the writ of execution and a motion to annul judgment.
Moreover, parties aggrieved by final judgments, orders or resolutions cannot be allowed to easily
and readily abuse a petition for annulment of judgment. Thus, the Court has instituted
safeguards by limiting the grounds for annulment to lack of jurisdiction and extrinsic, fraud, and
by prescribing in Section 1 of Rule 47 of the Rules of Court that the petitioner should show that
the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies are
no longer available without fault on the part of the petitioner. A petition for annulment that
ignores or disregards any of the safeguards cannot prosper.7
Further, it must be emphasized that not every kind of fraud justifies the action of annulment of
judgment. Only extrinsic fraud does. According to Cosmic Lumber Corporation v. Court of
Appeals,8 fraud is extrinsic when the unsuccessful party has been prevented from fully exhibiting
his case, by fraud or deception practiced on him by his opponent, as by keeping him away from
court, a false promise of a compromise; or where the defendant never had knowledge of the suit,
being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently or without
authority connives at his defeat; these and similar cases which show that there has never been a
real contest in the trial or hearing of the case are reasons for which a new suit may be sustained
to set aside and annul the former judgment and open the case for a new and lair hearing.
Sibal asserts that the negligence of his former counsel in handling his defense during the
proceedings in Civil Case No. 6429 resulted in violation of his right to due process. He claims that
his counsel's inexcusable negligence denied him of his day in court. However, he admitted that he
attended only one stage of the proceedings below, which was the preliminary conference. He was
not aware of the subsequent proceedings as he was totally dependent on his former counsel and
would merely wait for the latter to notify him if his attendance would be required. There was
likewise no indication that his counsel was in feet in cahoots with the Buquels to obtain the
assailed judgment. Sibal must therefore bear the unfortunate consequences of his actions. As a
litigant, he should not have entirely left the case in his counsel's hands, for he had the continuing
duty to keep himself abreast of the developments, if only to protect his own interest in the
litigation. He could have discharged said duty by keeping in regular touch with his counsel, but
he failed to do so.11
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated March 16,
2011 and its Resolution dated July 7, 2011 in CA-G.R. SP No. 104774 are hereby AFFIRMED.
SO ORDERED.chanroblesvirtuallawlibrary

As a ground for annulment of judgment, .extrinsic fraud must arise from an act of the adverse
party, and the fraud must be of such nature as to have deprived the petitioner of its day in court.
The fraud is not extrinsic if the act was committed by the petitioner's own counsel.9

The case at bar is closely similar to, if not the same with the case of Pinausukan Seafood House v.
FEBTC.10 In this case, the Court noticed that the petition's own language mentioned mistake and
gross negligence on the part of petitioner's own counsel. The petition even suggested that the
negligence of its counsel may constitute professional misconduct. The Court then ruled that such
neglect of counsel, even if it we're true, was not tantamount to extrinsic fraud because it did not
emanate from any act of FEBTC as the prevailing party, and did not occur outside the trial of the
case. What is certain, for purposes of application of Rule 47, is that mistake and gross negligence
cannot be equated to the extrinsic fraud under Rule 47. By its very nature, extrinsic fraud relates
to a cause that is collateral in character, i.e., it relates to any fraudulent act of the prevailing party
in litigation which is committed outside of the trial of the case, where the defeated party has
been prevented from presenting fully his side of the cause, by fraud or deception practiced on
him by his opponent. And even in the presence of fraud, annulment will not lie unless the fraud is
committed by the adverse party, not by one's own lawyer. In the latter case, the remedy of the
client is to proceed against his own lawyer and not to re-litigate the case where judgment had
been rendered.

Rule 47
SECOND DIVISION
[G.R. No. 132592. January 23, 2002]
AIDA P. BAEZ, petitioner, vs. GABRIEL B. BAEZ, respondent.
[G.R. No. 133628. January 23, 2002]
AIDA P. BAEZ, petitioner, vs. GABRIEL B. BAEZ, respondent.
DECISION
QUISUMBING, J.:
These two petitions stem from the decision[1] dated September 23, 1996 of the Regional
Trial Court of Cebu, Branch 20, in Civil Case No. CEB-16765. The first[2] seeks the reversal of the
Court of Appeals decision dated March 21, 1997, setting aside the orders dated October 1 and
November 22, 1996 of the Regional Trial Court. The second[3] prays for the reversal of the
resolution dated February 10, 1998, of the Court of Appeals in CA-G.R. No. CV-56265, denying the
motion to dismiss.
The antecedent facts, as gathered from the parties pleadings, are as follows:
On September 23, 1996, the Regional Trial Court of Cebu, Branch 20, decided Civil Case No.
CEB-16765, decreeing among others the legal separation between petitioner Aida Baez and
respondent Gabriel Baez on the ground of the latters sexual infidelity; the dissolution of their
conjugal property relations and the division of the net conjugal assets; the forfeiture of
respondents one-half share in the net conjugal assets in favor of the common children; the
payment to petitioners counsel of the sum of P100,000 as attorneys fees to be taken from
petitioners share in the net assets; and the surrender by respondent of the use and possession of
a Mazda motor vehicle and the smaller residential house located at Maria Luisa Estate Park
Subdivision to petitioner and the common children within 15 days from receipt of the decision.
Thereafter, petitioner filed an urgent ex-parte motion to modify said decision, while
respondent filed a Notice of Appeal.
The trial court granted petitioner Aida Banez urgent ex-parte motion to modify the decision
on October 1, 1996 by approving the Commitment of Fees dated December 22, 1994; obliging
petitioner to pay as attorneys fees the equivalent of 5% of the total value of respondents ideal
share in the net conjugal assets; and ordering the administrator to pay petitioners counsel, Atty.
Adelino B. Sitoy, the sum of P100,000 as advance attorneys fees chargeable against the aforecited
5%.[4]
In another motion to modify the decision, petitioner Aida Baez sought moral and exemplary
damages, as well as litigation expenses. On October 9, 1996, she filed a motion for execution
pending appeal. Respondent Gabriel Baez filed a consolidated written opposition to the two
motions, and also prayed for the reconsideration of the October 1, 1996 order.
On November 22, 1996, the trial court denied Aidas motion for moral and exemplary
damages and litigation expenses but gave due course to the execution pending appeal. Thus:
WHEREFORE, in view of all the foregoing premises, the petitioners motion to modify decision is
hereby ordered denied. But, petitioners motion for execution of decision pending appeal is
hereby granted. Consequently, let a writ of execution be issued in this case to enforce the
decision for (1) respondent to vacate the premises of the small residential house situated in
Maria Luisa Estate Park Subdivision, Lahug, Cebu City and for (2) respondent to surrender the
use and possession of said Mazda motor vehicle together with its keys and accessories thereof to
petitioner.
Atty. Edgar Gica, the Special Administrator, appointed in this case, is hereby ordered to make the
necessary computation of the value of the one-half (1/2) share of petitioner in the net remaining
conjugal assets of the spouses within 10 days from receipt of this order.
The petitioner is hereby ordered to post a bond in the amount of P1,500,000.00 to answer for all
the damages that respondent may suffer arising from the issuance of said writ of execution
pending appeal and to further answer for all the advances that petitioner may have received
from the Special Administrator in this case pending final termination of this present case.[5]
 In turn, in a petition for certiorari, Gabriel Baez elevated the case to the Court of Appeals. On
March 21, 1997, the appellate court rendered its decision, thus:
WHEREFORE, the Order dated October 1, 1996 and the Omnibus Order dated November 22,
1996, insofar as (1) it authorized the release of the sum of P100,000.00 to private respondents
counsel as the advanced share of private respondent [Aida Baez] in the net remaining conjugal
assets, and (2) granted the motion for execution pending appeal by ordering petitioner [Gabriel
Baez] to vacate the premises of the small residential house situated in Maria Luisa Estate Park
Subdivision, Lahug, Cebu City, and to surrender the use and possession of the Mazda Motor
vehicle to private respondent are hereby SET ASIDE. The writ of execution dated December 2,
1996 and the Order dated December 10, 1996 granting the motion filed by the sheriff to make
symbolic delivery of the subject house and motor vehicle to the administrator of the partnership
are also SET ASIDE.
As prayed for by petitioner, the Administrator of the conjugal partnership is hereby ordered to
cause the reimbursement by counsel for the private respondent [Aida Baez] of the amount of
P100,000.00 released to him as advance payment of attorneys fees.
SO ORDERED.[6]
On February 10, 1998, the Court of Appeals denied Aidas motion for reconsideration.
Hence, the petition in G.R. No. 132592, filed by herein petitioner.
In the meantime, the trial court gave due course to Gabriels Notice of Appeal and elevated
on April 15, 1997 the entire case records to the Court of Appeals. Aida filed with the Court of
Appeals a motion to dismiss the appeal on the ground that Gabriel had failed to file with the
appellate court a Record on Appeal. On February 10, 1998, the Court of Appeals decided the
motion, thus:
WHEREFORE, premises considered, the petitionerappellants motion to dismiss filed on
November 3, 1997 is hereby DENIED. The appointment of the petitioner-appellee as
administratix of the conjugal properties is hereby AFFIRMED.
In view of petitioners Motion to Withdraw her own appeal filed on November 27, 1997, and for
failing to pay the required docket fee within the prescribed period under Rule 41, Section 4 of the
1997 Rules of Civil Procedure, the appeal instituted by the petitioner Aida P. Baez is hereby
DISMISSED.
In continuance of the appeal of respondent-appellant [Gabriel Baez], he is hereby ordered to file
his brief with the court within 45 days from receipt of this resolution. The petitioner-appellee
[Aida Baez] shall file her own brief with the court within 45 days from receipt of the petitioner-
appellants [Gabriel Baez] brief.
SO ORDERED.[7]
The appellate court also denied herein petitioners motion for reconsideration, hence, the petition
in G.R. No. 133628.
On January 19, 2000, we consolidated the two petitions. Petitioner Aida Baez now avers
that the Court of Appeals erred:
I. G.R. No. 132592
... IN SETTING ASIDE THE GRANT OF EXECUTION PENDING APPEAL BY THE TRIAL
COURT OF THE PORTIONS OF ITS DECISION ORDERING RESPONDENT TO VACATE
THE SMALLER RESIDENTIAL HOUSE LOCATED AT THE MARIA LUISA ESTATE PARK
SUBDIVISION, CEBU CITY, AND TO PAY P100,000.00 TO PETITIONERS COUNSEL AS
ATTORNEYS FEES TO BE TAKEN FROM HER SHARE IN THE NET CONJUGAL
ASSETS.[8]
II. G.R. No. 133628:
... IN NOT GRANTING PETITIONERS MOTION TO DISMISS RESPONDENTS ORDINARY
APPEAL AND/OR NOT RETURNING THE RECORDS OF CIVIL CASE NO. CEB-16765 TO
THE REGIONAL TRIAL COURT OF CEBU.[9]
In G.R. No. 132592, petitioner manifested that she no longer questions the Court of Appeals
decision on the Mazda vehicle because respondent repossessed it. As to the residential house,
she claimed that being conjugal in nature, justice requires that she and her children be allowed to
occupy and enjoy the house considering that during the entire proceedings before the trial court,
she did not have the chance to occupy it. Further, she posted a bond of P1,500,000 for the
damages which respondent may suffer.[10] For these reasons, she asked for execution pending
appeal. The amount of P100,000 as advance payment to her counsel was a drop in the bucket
compared to the bond she posted, according to her. She also suggested as an alternative that she
simply be required to put up an additional bond. She also agreed to submit to an accounting as
regular administratrix and the advance attorneys fees be charged to her share in the net conjugal
assets.
In his comment, respondent denied petitioners allegation that she did not have the chance
to occupy the residential house. He averred that she could have, had she chosen to. According to
him, as the inventory of the couples properties showed, petitioner owned two houses and lots
and two motor vehicles in the United States, where she is a permanent resident. Respondent
contended that there was no compelling reason for petitioner to have the judgment executed
pending appeal.
Essentially, the core issue in G.R. No. 132592 is whether execution of judgment pending
appeal was justified.
As held in Echaus vs. Court of Appeals, 199 SCRA 381, 386 (1991), execution pending appeal
is allowed when superior circumstances demanding urgency outweigh the damages that may
result from the issuance of the writ. Otherwise, instead of being an instrument of solicitude and
justice, the writ may well become a tool of oppression and inequity. [11]
In this case, considering the reasons cited by petitioner, we are of the view that there is no
superior or urgent circumstance that outweighs the damage which respondent would suffer if he
were ordered to vacate the house. We note that petitioner did not refute respondents allegations
that she did not intend to use said house, and that she has two (2) other houses in the United
States where she is a permanent resident, while he had none at all. Merely putting up a bond is
not sufficient reason to justify her plea for execution pending appeal. To do so would make
execution routinary, the rule rather than the exception.[12]
Similarly, we are not persuaded that the P100,000 advance payment to petitioners counsel
was properly granted. We see no justification to pre-empt the judgment by the Court of Appeals
concerning said amount of P100,000 at the time that the trial courts judgment was already on
appeal.
In G.R. No. 133628, petitioner Aida Baez contends that an action for legal separation is
among the cases where multiple appeals may be taken. According to her, the filing of a record on
appeal, pursuant to Section 2(a), Rule 41 of the Rules of Court, [13] is required in this case. She
concludes that respondents appeal should have been dismissed for his failure to file the record
on appeal within the reglementary period, as provided under Section 1-b, Rule 50 of the Rules of
Court.[14]
Petitioner likewise prays that, in the event that we do not dismiss Gabriel Baez appeal, we
should direct the appellate court to return the records of the case to the RTC of Cebu. Thereafter,
according to her, respondent should file his record on appeal for approval and transmittal to the
Court of Appeals. In the alternative, she prays that the appellate court retain only the pleadings
and evidence necessary to resolve respondents appeal pursuant to Section 6, Rule 44 [15] and
Section 6, Rule 135[16] of the Rules of Court, and return the rest of the case records to the RTC.
In turn, respondent argues that Section 39 of B.P. 129 [17] expressly abolished the
requirement of a record on appeal, except in appeals in special proceedings in accordance with
Rule 109,[18] and other cases wherein multiple appeals are allowed. An action for legal
separation, he avers, is neither a special proceeding nor one where multiple appeals are allowed.
Now, is an action for legal separation one where multiple appeals are allowed? We do not
think so.
In Roman Catholic Archbishop of Manila v. Court of Appeals, 258 SCRA 186, 194 (1996), this
Court held:
xxx Multiple appeals are allowed in special proceedings, in actions for recovery of property with
accounting, in actions for partition of property with accounting, in the special civil actions of
eminent domain and foreclosure of mortgage. The rationale behind allowing more than one
appeal in the same case is to enable the rest of the case to proceed in the event that a separate
and distinct issue is resolved by the court and held to be final.
In said case, the two issues raised by therein petitioner that may allegedly be the subject of
multiple appeals arose from the same cause of action, and the subject matter pertains to the
same lessor-lessee relationship between the parties. Hence, splitting the appeals in that case
would only be violative of the rule against multiplicity of appeals.
The same holds true in an action for legal separation. The issues involved in the case will
necessarily relate to the same marital relationship between the parties. The effects of legal
separation, such as entitlement to live separately, dissolution and liquidation of the absolute
community or conjugal partnership, and custody of the minor children, follow from the decree of
legal separation.[19] They are not separate or distinct matters that may be resolved by the court
and become final prior to or apart from the decree of legal separation. Rather, they are mere
incidents of legal separation.[20] Thus, they may not be subject to multiple appeals.
Petitioners alternative prayers that in case we do not dismiss the appeal, we return the
records to the trial court and require respondent to file a record on appeal, or we return the
records to the trial court and retain only the pleadings and orders relevant to the appeal, are
untenable. If we grant the first, we are effectively saying that the instant case is one involving
multiple appeals, which it is not. If we allow the second, we are effectively applying by analogy,
Section 6, Rule 44 and Section 6, Rule 135 of the Rules of Court, without petitioner showing
support therefor in law or jurisprudence.[21]
 WHEREFORE, the instant petitions are DENIED for lack of merit. The decision and
resolution of the Court of Appeals in CA-G.R. SP No. 42663 and CA-G.R. No. CV-56265,
respectively, are hereby AFFIRMED, so that the Order dated October 1, 1996, of the Regional
Trial Court authorizing the release of P100,000 to petitioners counsel; the Omnibus Order dated
November 22, 1996 granting the motion pending appeal; the writ of execution dated December
2, 1996; and the Order dated December 10, 1996 granting the motion by the sheriff to make
symbolic delivery of the house and vehicle are SET ASIDE. Further, the Administrator of the
conjugal partnership is ORDERED to cause the reimbursement by petitioners counsel of the
released amount of P100,000. The Court of Appeals is hereby DIRECTED to give due course to
respondents appeal, and the Division Clerk of Court of this Court is likewise DIRECTED to
promptly remand the record of these cases to the Court of Appeals.
Costs against petitioner.
SO ORDERED.
 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[1] dated April 11, 2000, Sheriff Rodolfo V. Quitalig of the 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[3] dated October 3, 2000, respondent denied the charge. He asked 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.[4] He also pointed out 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,[5] the OCA found respondent to have been negligent 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.[6] (Citation omitted)
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 SO ORDERED.
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,[9] the Court has said that the failure to make a return of a writ within the
required period is nonfeasance. In Bautista v. De Castro,[10] the provincial sheriff of Zambales and
his deputy were suspended without pay for 30 and 15 days, respectively, for dereliction of
duty. In Barola v. Abogatal,[11] a sheriff who had received a writ of execution on January 15, 1978,
but made a return thereof only on May 22, 1978, was fined a months salary. In Lapea v.
Pamarang,[12] a sheriff whose Return was four days late was fined P2,000.
Casal v. Concepcion Jr.[13] ordered the dismissal of respondent sheriff from the 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,[14] the respondent therein was suspended for a year without
pay when he failed to act promptly on the Writs of Execution issued from 1998-2001. And
in Lumbre v. Dela Cruz,[15]respondent, after being found guilty of an 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.
 EN BANC
G.R. No. 155618 March 26, 2003
EDGAR Y. SANTOS, petitioner,
vs.
COMMISSION ON ELECTIONS (FIRST DIVISION) and PEDRO Q. PANULAYA, respondents.
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.2 Likewise on April 22, 2002, respondent 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. (italics 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,5 thereby
installing petitioner as Municipal Mayor of Balingoan, 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. 20-2002.6 After five days, or on August 26, 2002, he filed a
supplemental petition in SPR No. 20-2002,7 wherein he prayed:
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. 37-2002.9 The petition contained the same prayer as that in
the supplemental 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,12 brought 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."13 On October 14, 2002, the COMELEC 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.16 The most important factor in
determining the 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.18 Willful and deliberate
forum-shopping is a ground 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. COMELEC22 that:
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. COMELEC24 in this wise:
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,25 "to give as much recognition to the worth of a trial
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.
 [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.[1] On 26 April 1999, the trial court issued a writ of attachment. [2] On 4 June 1999 the writ was
returned partially satisfied since only a parcel of land purportedly owned by defendant Benito Sy
was attached.[3] In the meantime, summons was served on each of 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.[4] On 21
September 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.[6] For about six (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.[7] On 9 May 2000
petitioner 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. [8] Only respondent Nelson Tiu affixed
his signature on the 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.[10] On 31 July 2000 petitioner moved for
reconsideration of the Order by informing the trial court of respondents unremitting desire to
settle the case amicably through a loan restructuring program.[11] On 22 August 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.[14] This motion was followed on 5 October 2000 by 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. [15] Respondent Anderson Uy 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.[19] In the main, petitioner argued that the court a
quo had no 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[21] holding that -
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[23] where it was held that 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. [25] A complaint that is re-filed leads
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,[26] which in the context of the 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 Orderdismissing 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[28] a similar
directive, i.e., [t]he parties are given a period of fifteen (15) 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.[29] On the other hand, if we are to concede 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.[30] This 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.[34] Hence, if only to inspire confidence in the 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.[35] Stress must also be
laid upon the official directive that courts must endeavor to convince parties in a civil case to
consummate a fair settlement,[36] and to mitigate damages to be paid by the losing party who has
shown a sincere desire for such give-and-take.[37] All 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. [38] In the
absence of a pattern or scheme to delay the disposition of the 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.

[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[1] for Review under Rule 45 of the Rules of Court, assailing the
May 4, 2000 Decision[2] and the July 14, 2000 Resolution[3] of the Court of Appeals (CA) in CA-GR
CV No. 56952. The 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. [5] (Citations omitted)
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.[6] Ruling that the trial court 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:
A the appellate court.
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 be filed by the prevailing party with notice to the adverse party; b) there must be good reasons
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
C (b) the right of appeal has been renounced or waived; (c) the period for appeal has lapsed
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.[8] (Citations omitted)
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
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
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. [10] Normally,
execution cannot be obtained until and unless (a) the judgment has become final and executory;
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.
 [G.R. No. 136726. September 24, 2003] 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
PANFILO V. VILLARUEL, JR., petitioner, vs. REYNALDO D. FERNANDO, MODESTO ABARCA,
order their return to their mother unit since more than 90 days had already lapsed. Respondents
JR. and MARILOU M. CLEOFAS, 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
DECISION the detail order.
CARPIO, J.: 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
The Case respondents.
Despite repeated demands by respondents, petitioner failed and refused to reinstate
This petition for review on certiorari[1] seeks to reverse the Decision[2] of the Court of respondents to their mother unit.
Appeals in CA-G.R. SP No. 48233[3] dated 30 September 1998 denying due course to the petition On 24 January 1996, respondents filed a Petition for Mandamus and Damages with Prayer
for certiorari[4] filed by Panfilo V. Villaruel, Jr. and the Resolution dated 3 December 1998 for a Preliminary Mandatory Injunction against petitioner with the Regional Trial Court of Pasay
denying the motion for reconsideration. City docketed as Civil Case No. 96-0139. Respondents prayed for the following:

PRAYER
The Facts
WHEREFORE, premises considered, petitioners herein respectfully pray of this Honorable Court
that:
Petitioner Panfilo V. Villaruel, Jr. (petitioner) is the former Assistant Secretary of the Air
Transportation Office (ATO), Department of Transportation and Communication
1. Pending the determination of the merits of this petition, a writ of preliminary mandatory
(DOTC). Respondents Reynaldo D. Fernando, Modesto E. Abarca, Jr. (Abarca), and Marilou M.
injunction be issued ex-parte directing respondent Panfilo V. Villaruel, Jr., to recall the petitioners
Cleofas are the Chief, Chief Administrative Assistant, and Administrative Assistant, respectively,
herein within twenty four (24) hours from receipt hereof to their mother unit, the Civil Aviation
of the Civil Aviation Training Center (CATC). The CATC is an adjunct agency of the ATO tasked to
Training Center, Air Transportation Office, DOTC, and to forthwith allow them to assume,
train air traffic controllers, airway communicators and related civil aviation personnel for the
perform and discharge the functions, duties and responsibilities inherent, appurtenant and
local aviation industry as well as for the Southeast Asian and Pacific region.
incident to their respective offices.
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. 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,
On 29 April 1995, respondents wrote to DOTC Secretary Jesus B. Garcia and Undersecretary
and ordering the respondent Panfilo Villaruel, Jr., to pay petitioners herein the following
Josefina T. Lichauco through petitioner requesting for reconsideration of the detail order.
damages, to wit:
On 7 May 1995, in compliance with the detail order, respondents reported to the Office of
Undersecretary Cal at DOTC.
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[7] assailing the trial courts 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.[9] With the filing 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,[10] filed a Motion 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[11] superseded the decision of the trial court. The
Ombudsmans 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,[14] which held 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) [15] punished with suspension
from office while the latter 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 [18] his case. Petitioner argues that
the inexcusable 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[19] and this 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[20] and prevent the decision of the trial court
from becoming final and executory.
In Villa Rhecar Bus v. De la Cruz,[21] which petitioner himself cited, the 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,[22] the Court declared:
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.[23] Litigants represented by counsel should not expect that all they need to do
is sit back, relax and await the outcome of their case.[24] To agree with petitioners stance 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.[25] The Court will not countenance such ill-
founded argument which contradicts 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.[27] True, this rule admits of certain exceptions. One of these exceptions is whenever
circumstances transpire after the finality of the decision rendering its execution unjust and
inequitable.[28] This, however, is not the case here. In the present case, the 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.
 [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[1] dated July 26, 2001, Spouses Jaime
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 DaniloO. 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 Purficacion Padilla 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[3] dated April 2, 2002, respondent judge explained that he 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[4] dated April 18, 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.[5] Moreover,
it emphasized that this Court had merely affirmed the Decision of 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 executoryjudgments 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[7] and to decide cases and motions within
the required periods.[8] Section 15(1) of Article VIII of the 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,[9] also 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.[11] We have 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. [12] As the time-honored principle
goes, justice delayed is justice denied.
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. [14] A decision that is left
unexecuted or delayed indefinitely because of the sheriffs inefficiency or negligence remains an
empty victory on the part of the prevailing party.[15] For this reason, any inordinate delay in the
execution of judgment is truly 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.[16] According to this Circular, all sheriffs 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.[17] Respondent Sheriffs Return of Service[18] of that 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.[19] As an officer of the court, he should at all times show a high degree
of professionalism in the performance of his duties.[20] He has failed to 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[21] in resolving a pending motion, an infraction that also
constitutes a violation of a Court circular.[22] Under Section 11(B) of Rule 140 of the Revised
Rules of Court, this less serious charge[23] may be sanctioned by 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,[24] a less grave 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. [25] But under the
circumstances, we find it inadvisable to suspend respondent sheriff, considering that his work
would be left unattended in his absence. Instead, we adopt our previous ruling
in Aquino v. Lavadia [26] imposing a fine equivalent to his one-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.

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[1] of the Court of Appeals (CA) in CA-G.R. SP No. 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[4] to the GSIS. Official Receipts Nos. 905401 and 901685 for the
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 [5] and turned over to Emilio
Geli the owners copy of TCT No. 80384 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.[8] Conformably
with said writ, the sheriff served a Sheriffs Notice to Vacate[9] on 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. [11] On May 12, 1998,
the CA rendered the assailed decision in 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.[14] In the second situation, the execution may be stayed, notwithstanding the
affirmance of the appealed judgment by this Court.[15] It is required, however, that the
supervening facts 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.[16] The interested party may file a motion to quash
a writ of execution 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. [17] Evidence 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.[19] However, the CA 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.[20] With the rescission of 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.[21] The respondents, however, are 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.[24] Upon the lapse of the one-year period, the
right to redeem becomes functus officio on the date of its expiry.[25] The rule on 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. [26] Before the lapse of
the one-year period, 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. [27] Such right becomes
absolute only after the expiration of the redemption period without the right of redemption
having been exercised.[28] The purchaser is entitled as a matter of right to consolidation of title
and to the possession of the property.[29] Where redemption is seasonably exercised by the
mortgagor-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 petitioners Spouses Serrano are obliged to refund to the respondents, as heirs of Emilio S. Geli,
nevertheless remained adamant and refused to pay the petitioners account with the GSIS which the amount of P67,701.84 to be deducted from the amount due to the petitioners under the
impelled the latter to foreclose the real estate mortgage and sell the property at public September 6, 1984 Decision of the Regional Trial Court, Quezon City, in Civil Case No. Q-24790.
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 SO ORDERED.
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). [32] Equity is
applied only in the absence of and never against statutory law or judicial rules of
procedure.[33] We reiterate our ruling that:

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
 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, 13th 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 WHEREFORE, the petition is DENIED. The assailed Decision dated December 18, 2001 of
incurred for food, shelter, clothing and medical attendance. the Court of Appeals in CA-G.R. SP No. 61799 is AFFIRMED IN TOTO. Costs against petitioner.
SO ORDERED.
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.
 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 of the grounds upon which a special relief is sought and leave the rest to the presentment in a
principle of res judicata by claiming the nature of their account on the ground therefor and their second suit if the first fails. There would be no end to litigation if such piecemeal presentation is
legal theory cannot prosper. Case law has it that where a right, question or fact is distinctly put in allowed.[54]
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 IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision and Resolution
the parties or their privies in a second suit irrespective of whether the causes of action are the of the Court of Appeals and the assailed Order of the RTC are SET ASIDE. The Regional Trial
same.[45] The ruling of the CA that the action of the private respondents and their legal theory in Court is ORDERED to dismiss the complaint in Civil Case No. Q-01-44227.
their second complaint were different from their causes of action and legal theory in the first SO ORDERED.
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
 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[1] dated June 26, 2000 of
the Court of Appeals in CA-G.R. SP No. 59234, which dismissed petitioners petition and affirmed
the Order[2] dated May 26, 2000 of 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[3] dated July 10, 2000, denying petitioners 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,[5] Rule 39 of the Revised Rules of Court. He prayed that 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),[7] Rule 39 of the Revised Rules of Court. Citing De
Leon v. Soriano,[8] where we held that the approach of the end of ones life span is a compelling
cause for discretionary execution pending appeal,[9] the trial court used the circumstance of Tohs
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.[12] These exceptions include instances where: (1) 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.[17] It concluded that old age is a
good reason to allow execution 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.[18] The Court of Appeals found said ruling in conformity with 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. [19] In the subsequent case of Borja v.
Court of Appeals,[20] we likewise allowed execution pending appeal in favor of a 76 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.[23] Factual findings of the trial court, when affirmed by the
appellate court, bind this Court and are entitled to utmost respect.[24] No cogent reason having
been given for us to depart therefrom we 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
(P.D.) No. 957.[3] One of the violations complained of was its failure to provide an open space in
the said subdivision.
ROGELIO (ROGER) PANOTES (thru ARACELI G.R. No. 154739
BUMATAY, as successor-in-interest),
Petitioner, Present: During the proceedings before the NHA, an ocular inspection showed that the subdivision has no

PUNO, C.J., Chairperson, open space. The NHA found, however, that Block 40, with an area of 22,916 square meters, could
SANDOVAL-GUTIERREZ, be utilized as open space. Thus, in its Resolution dated August 14, 1980, the NHA directed
- versus - CORONA,
AZCUNA, and PROSECOR to provide the Provident Village an open space which is Block 40.
GARCIA, JJ.

CITY TOWNHOUSE DEVELOPMENT In a letter of the same date, then NHA Acting General Manager Antonio A. Fernando ordered
CORPORATION, Promulgated: PROSECOR to provide Block 40 of the subdivision as open space.
Respondent.
January 23, 2007
PROSECOR was served copies of the NHA Resolution and the letter on August 22, 1980.
x --------------------------------------------------------------------------------------x

DECISION
Considering that PROSECOR did not appeal from the NHA Resolution, it became final and
SANDOVAL-GUTIERREZ, J.: executory.

When Panotes filed a motion for execution of the NHA Resolution, it was found that the records
For our resolution is the instant Petition for Review on Certiorari assailing the Decision [1] of the
of the case were mysteriously missing. Hence, his motion was provisionally dismissed without
Court of Appeals dated January 29, 2002 in CA-G.R. SP No. 52621 and its
prejudice.
Resolution[2] dated August 5, 2002denying the motion for reconsideration.

Meanwhile, PROSECOR sold to City Townhouse Development Corporation (CTDC), respondent,

This case stemmed from a complaint filed with the National Housing Authority (NHA) in April
several lots in the subdivision. Among the lots sold were those comprising Block 40. CTDC was
1979 by Rogelio (Roger) Panotes, petitioner, then president of the Provident Village
unaware of the NHA Resolution ordering PROSECOR to have Block 40 utilized as open space
Homeowners Association, Inc., against Provident Securities Corporation (PROSECOR), owner-
of Provident Village.
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
Eventually, Panotes was succeeded by Araceli Bumatay as president of the Provident Village
IT IS SO ORDERED.
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. On appeal to the HLURB Board of Commissioners, Arbiter Bunagans Decision was affirmed with
Impleaded therein as defendant was CTDC, whom she alleged as successor-in-interest of modification in the sense that CTDC has the right to recover from PROSECOR what it has lost.
PROSECOR.
After its motion for reconsideration was denied, CTDC then interposed an appeal to the Office of
In its answer, CTDC averred, among others, that (1) Araceli Bumatay has no legal personality to the President (OP). On February 10, 1999, the OP rendered its Decision affirming in toto the
file the action for revival of judgment; (2) there is a pending litigation between CTDC and judgment of the HLURB Board of Commissioners. CTDC filed a motion for reconsideration, but it
PROSECOR involving Block 40; and (3) other entities like the Bangko Sentral Ng Pilipinas and was denied in a Resolution dated April 14, 1999.
Provident Savings Bank have existing liens over Block 40.
CTDC then filed with the Court of Appeals a petition for review under Rule 43 of the 1997 Rules
On October 15, 1991, the HLURB, through Housing and Land Use Arbiter Charito M. Bunagan, of Procedure, as amended, docketed therein as CA-G.R. SP No. 52621.
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: 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
WHEREFORE, premises considered, judgment is hereby rendered declaring
that the petition was not supported by certified true copies of such material portions of the
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 records and other pertinent papers referred to in the petition.
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 CTDC filed a motion for reconsideration which was opposed by Bumatay.
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]
On June 10, 1999, CTDC submitted to the Court of Appeals a certification of non-forum shopping
Furthermore, let a Cease and Desist Order be, as it is hereby, issued against
respondent Provident Securities Corp. and City Townhouse Development as well as the pleadings mentioned in its Resolution.
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- On July 27, 1999, the Court of Appeals issued a Resolution granting CTDCs motion for
5683, the open space allocated and reserved for the Provident Villages in reconsideration and reinstated its petition.
Marikina, Metro Manila.
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.
 The Antecedent Facts
THIRD DIVISION
Emerita Garon (Garon) filed an action for sum of money docketed as Civil Case No. 99-1051
STRONGHOLD INSURANCE G.R. No. 148090
against Project Movers Realty and Development Corporation (Project Movers) and Stronghold
COMPANY, INC.,
Petitioner, Present: Insurance Company, Inc. (Stronghold Insurance). In an Order[3] dated 19 September 2000, the
QUISUMBING, J.,
Chairperson, Regional Trial Court of Makati City, Branch 56[4] (trial court) granted Garons motion for
- versus - CARPIO, summary judgment. The trial court rendered judgment in favor of Garon, as follows:
CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ. 1. Defendant Project Movers Realty and Development Corporation is
hereby directed to pay plaintiff as follows:
HONORABLE NEMESIO S. FELIX,
in his capacity as Presiding Judge of On Promissory Note No. PMRDC 97-12-332:
Branch 56, Regional Trial Court,
Makati City, RICHARD C. JAMORA, Promulgated: (A) The sum of PESOS: Six Million Eighty Eight Thousand Seven
Branch Clerk of Court, and Hundred Eighty Three and 68/100 (P6,088,783.68) under
EMERITA GARON, PMRDC-97-12-332;
Respondents. November 28, 2006
(B) Interest thereon at 36% per annum computed from 19
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x December 1997 until fully paid;

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

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

CARPIO, J.: 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
The Case (US$189,418.75) under PMRDC-97-12-333;
Before the Court is a petition for review[1] assailing the 4 May 2001 Decision[2] of the Court of
(B) Interest thereon at the stipulated rate of 17% per annum
Appeals in CA-G.R. SP No. 63334. computed from 31 December 1997;
 (C) A penalty of 3% per month computed from 03 November
On 16 February 2001, Stronghold Insurance filed a notice of appeal.
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: Stronghold Insurance also filed a petition for certiorari before the Court of Appeals to assail the
TWELVE MILLION SEVEN HUNDRED trial courts 8 February 2001 Order and the writ of execution pending appeal. In its
FIFTY FIVE THOUSAND ONEHUNDRED THIRTY NINE AND EIGHTY FIVE
CENTAVOS (P12,755,139.85). 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
3. Defendants Project Movers Realty and Development Corporation and
Stronghold Insurance Company, Inc. are also ordered to pay plaintiff notices of garnishment had been served before the Court of Appeals issued the temporary
Mrs. Garon jointly and severally the sum of PESOS: TWO HUNDRED THOUSAND restraining order (TRO). In its Order[9] dated 7 March 2001, the trial court denied Stronghold
as attorneys fees plus costs of suit.
Insurances Urgent Motion for the recall of the notices of garnishment.
All other claims and counter-claims of the parties are hereby ordered
dismissed.
The Ruling of the Court of Appeals
SO ORDERED.[5]

In its 4 May 2001 Decision, the Court of Appeals dismissed the petition of Stronghold Insurance
On 6 October 2000, Garon filed a motion for execution pending appeal. On 10 October 2000, and lifted the TRO it issued.
Stronghold Insurance moved for the reconsideration of the 19 September 2000 Order of the trial
court. 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
In an Order[6] dated 23 January 2001, the trial court denied Stronghold Insurances motion for Court of Appeals held that while it was not Garon who was ill, Garon needed the money to
reconsideration for lack of merit. support her husbands medical expenses and to support her family.

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.
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
The trial court ruled that an appeal from its 19 September 2000 Order is only a ploy to delay the
Stronghold Insurance may suffer should the trial courts decision be reversed on appeal. [18]
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
In granting the motion for execution pending appeal, the trial court ruled:
judges the merits of the main case on appeal.[21] Thus:
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]
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
SO ORDERED.
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.
 Republic of the Philippines Maekara brought Marinay to Japan. However, Marinay allegedly suffered physical abuse from
SUPREME COURT Maekara. She left Maekara and started to contact Fujiki.3
Manila
Fujiki and Marinay met in Japan and they were able to reestablish their relationship. In 2010,
SECOND DIVISION 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,
G.R. No. 196049 June 26, 2013 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
MINORU FUJIKI, PETITIONER, recognized; (2) that the bigamous marriage between Marinay and Maekara be declared void ab
vs. initiounder Articles 35(4) and 41 of the Family Code of the Philippines;5 and (3) for the RTC to
MARIA PAZ GALELA MARINAY, SHINICHI MAEKARA, LOCAL CIVIL REGISTRAR OF QUEZON direct the Local Civil Registrar of Quezon City to annotate the Japanese Family Court judgment on
CITY, AND THE ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE NATIONAL the Certificate of Marriage between Marinay and Maekara and to endorse such annotation to the
STATISTICS OFFICE,RESPONDENTS. Office of the Administrator and Civil Registrar General in the National Statistics Office (NSO). 6

DECISION The Ruling of the Regional Trial Court

CARPIO, J.: 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
The Case Voidable Marriages (A.M. No. 02-11-10-SC):

This is a direct recourse to this Court from the Regional Trial Court (RTC), Branch 107, Quezon Sec. 2. Petition for declaration of absolute nullity of void marriages.
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 (a) Who may file. A petition for declaration of absolute nullity of void marriage may be filed
Reconsideration. The RTC dismissed the petition for "Judicial Recognition of Foreign Judgment solely by the husband or the wife.
(or Decree of Absolute Nullity of Marriage)" based on improper venue and the lack of personality
of petitioner, Minoru Fujiki, to file the petition. xxxx

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.
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 Philippines11 on 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 Court 19 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 Corpuzconcerned 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.77 If 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.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 203241 July 10, 2013
RIZAL COMMERCIAL BANKING CORPORATION, PETITIONER,
vs.
FEDERICO A. SERRA, RESPONDENT.
DECISION
CARPIO, J.:
The Case
This Petition for Review on Certiorari1 with prayer for the issuance of a Writ of Preliminary
Injunction and/or Temporary Restraining Order assails the 16 February 2012 2 and 26 July
20123 Orders of the Regional Trial Court of Makati City, Branch 134 (RTC Makati).
The Facts
Respondent Federico A. Serra (Serra) is the owner of a 374 square meter parcel of land located
along Quezon Street, Masbate, Masbate. On 20 May 1975, Serra and petitioner Rizal Commercial
Banking Corporation (RCBC) entered into a Contract of Lease with Option to Buy, wherein Serra
agreed to lease his land to RCBC for 25 years. Serra further granted RCBC the option to buy the
land and improvement (property) within 10 years from the signing of the Contract of Lease with
Option to Buy.
On 4 September 1984, RCBC informed Serra of its decision to exercise its option to buy the
property. However, Serra replied that he was no longer interested in selling the property. On 14
March 1985, RCBC filed a Complaint for Specific Performance and Damages against Serra
(Specific Performance case) in the RTC Makati. The RTC Makati initially dismissed the complaint.
However, in an Order dated 5 January 1989, the RTC Makati reversed itself and ordered Serra to
execute and deliver the proper deed of sale in favor of RCBC.4
Serra appealed to the Court of Appeals (CA). On 18 May 1989, Serra donated the property to his
mother, Leonida Ablao (Ablao). On 20 April 1992, Ablao sold the property to Hermanito Liok
(Liok). A new land title was issued in favor of Liok. Thus, RCBC filed a Complaint for Nullification
of Deed of Donation and Deed of Sale with Reconveyance and Damages against Liok, Ablao and
Serra (Annulment case) before the RTC of Masbate City (RTC Masbate).
Meanwhile, the CA, and later the Supreme Court, affirmed the order of the RTC Makati in the
Specific Performance case. In a Decision dated 4 January 1994, this Court declared that the
Contract of Lease with Option to Buy was valid, effective, and enforceable. On 15 April 1994, the
decision in the Specific Performance case became final and executory upon entry of judgment. 5
On 22 October 2001, the RTC Masbate ruled in favor of RCBC, declaring the donation in favor of
Ablao and the subsequent sale to Liok null and void.6 In a Decision dated 28 September 2007, the
CA affirmed the RTC Masbate decision. The CA held that the donation to Ablao was simulated and
was done solely to evade Serras obligation to RCBC. Since Ablao had no right to transfer the
property and Liok was not a buyer in good faith, the subsequent sale to Liok was likewise null
and void.
Thus, Liok filed a Petition for Review on Certiorari, docketed as G.R. No. 182478, while Serra and
Ablao filed a Petition for Certiorari, docketed as G.R. No. 182664, before this Court. In separate
Resolutions dated 30 June 2008 and 22 October 2008, which became final and executory on 27
August 20087 and 3 March 2009,8 respectively, this Court found neither reversible error nor
grave abuse of discretion on the CAs part.
On 25 August 2011, RCBC moved for the execution of the decision in the Specific Performance
case. RCBC alleged that it was legally impossible to ask for the execution of the decision prior to
the annulment of the fraudulent transfers made by Serra. Thus, the period to execute by motion
was suspended during the pendency of the Annulment case. On 22 September 2011, Serra filed
his comment and opposition to the motion. Serra insisted that the motion for execution was
already barred by prescription and laches, and that RCBC was at fault for failing to register as
lien in the original title the Contract of Lease with Option to Buy.
In an Order dated 16 February 2012, the RTC Makati denied RCBCs motion for execution. The
RTC Makati opined that "[RCBC] should have asked for the execution of the deed of sale and have
the same registered with the Registry of Deeds, so that even if [Serra] sold or transferred the
subject property to any person the principle of caveat emptor would set in." 9
In an Order dated 26 July 2012, the RTC Makati denied RCBCs motion for reconsideration. Thus,
RCBC filed this petition.
In a Resolution dated 3 December 2012, this Court granted RCBCs Temporary Restraining Order
against the implementation of the questioned Orders upon RCBCs filing of a bond.
The Issue
RCBC raises this sole issue for resolution:
WHETHER OR NOT THE COURT A QUO ERRED IN HOLDING THAT PETITIONER RCBC IS
BARRED FROM HAVING ITS 05 JANUARY 1989 DECISION EXECUTED THROUGH MOTION,
CONSIDERING THAT UNDER THE CIRCUMSTANCES OBTAINING IN THIS CASE, RCBC WAS
UNLAWFULLY PREVENTED BY THE RESPONDENT FROM ENFORCING THE SAID DECISION. 10
The Ruling of the Court
The petition has merit.
decision in the Annulment case attained finality on 3 March 2009 and RCBCs motion for
execution was filed on 25 August 2011, RCBCs motion is deemed filed within the five-year
period for enforcement of a decision through a motion.
This Court has reiterated that the purpose of prescribing time limitations for enforcing
judgments is to prevent parties from sleeping on their rights.14 Far from sleeping on its rights,
RCBC has pursued persistently its action against Serra in accordance with law. On the other
hand, Serra has continued to evade his obligation by raising issues of technicality. While strict
compliance with the rules of procedure is desired, liberal interpretation is warranted in cases
where a strict enforcement of the rules will not serve the ends of justice. 15
WHEREFORE, we GRANT the petition. We SET ASIDE the assailed Orders of the Regional Trial
Court of Makati City dated 16 February 2012 and 26 July 2012. The Temporary Restraining
Order issued by this Court on 3 December 2012 is made permanent. The Regional Trial Court of
Makati City is DIRECTED to issue the writ of execution in Civil Case No. 10054 for the
enforcement of the decision therein. Costs against petitioner.
SO ORDERED.

The Rules of Court provide that a final and executory judgment may be executed by motion
within five years from the date of its entry or by an action after the lapse of five years and before
prescription sets in.11 This Court, however, allows exceptions when execution may be made by
motion even after the lapse of five years. These exceptions have one common denominator: the
delay is caused or occasioned by actions of the judgment obligor and/or is incurred for his
benefit or advantage.12

In Camacho v. Court of Appeals,13 we held that where the delays were occasioned by the
judgment debtors own initiatives and for her advantage as well as beyond the judgment
creditors control, the five-year period allowed for enforcement of the judgment by motion is
deemed to have been effectively interrupted or suspended.

In the present case, there is no dispute that RCBC seeks to enforce the decision which became
final and executory on 15 April 1994. This decision orders Serra to execute and deliver the
proper deed of sale in favor of RCBC. However, to evade his obligation to RCBC, Serra transferred
the property to his mother Ablao, who then transferred it to Liok. Serras action prompted RCBC
to file the Annulment case. Clearly, the delay in the execution of the decision was caused by Serra
for his own advantage. Thus, the pendency of the Annulment case effectively suspended the five-
year period to enforce through a motion the decision in the Specific Performance case. Since the
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 103338 January 4, 1994
FEDERICO SERRA, petitioner,
vs.
THE HON. COURT OF APPEALS AND RIZAL COMMERCIAL BANKING
CORPORATION, respondents.
Andres R. Amante, Jr. for petitioner.
R.C. Domingo, Jr. & Associates for private respondent.
NOCON, J.:
A promise to buy and sell a determinate thing for a price certain is reciprocally demandable. An
accepted unilateral promise to buy and sell a determinate thing for a price certain is binding
upon the promisor if the promise is supported by a consideration distinct from the price. (Article
1479, New Civil Code) The first is the mutual promise and each has the right to demand from the
other the fulfillment of the obligation. While the second is merely an offer of one to another,
which if accepted, would create an obligation to the offeror to make good his promise, provided
the acceptance is supported by a consideration distinct from the price.
Disputed in the present case is the efficacy of a "Contract of Lease with Option to Buy", entered
into between petitioner Federico Serra and private respondent Rizal Commercial Banking
Corporation. (RCBC).
Petitioner is the owner of a 374 square meter parcel of land located at Quezon St., Masbate,
Masbate. Sometime in 1975, respondent bank, in its desire to put up a branch in Masbate,
Masbate, negotiated with petitioner for the purchase of the then unregistered property. On May
20, 1975, a contract of LEASE WITH OPTION TO BUY was instead forged by the parties, the
pertinent portion of which reads:
1. The LESSOR leases unto the LESSEE, an the LESSEE hereby accepts in lease,
the parcel of land described in the first WHEREAS clause, to have and to hold
the same for a period of twenty-five (25) years commencing from June 1, 1975
to June 1, 2000. The LESSEE, however, shall have the option to purchase said
parcel of land within a period of ten (10) years from the date of the signing of
this Contract at a price not greater than TWO HUNDRED TEN PESOS (P210.00)
per square meter. For this purpose, the LESSOR undertakes, within such ten-
year period, to register said parcel of land under the TORRENS SYSTEM and all
expenses appurtenant thereto shall be for his sole account.
If, for any reason, said parcel of land is not registered under the TORRENS
SYSTEM within the aforementioned ten-year period, the LESSEE shall have the
right, upon termination of the lease to be paid by the LESSOR the market value
of the building and improvements constructed on said parcel of land.
The LESSEE is hereby appointed attorney-in-fact for the LESSOR to register said
parcel of land under the TORRENS SYSTEM in case the LESSOR, for any reason,
fails to comply with his obligation to effect said registration within reasonable
time after the signing of this Agreement, and all expenses appurtenant to such
registration shall be charged by the LESSEE against the rentals due to the
LESSOR.
2. During the period of the lease, the LESSEE covenants to pay the LESSOR, at
the latter's residence, a monthly rental of SEVEN HUNDRED PESOS (P700.00),
Philippine Currency, payable in advance on or before the fifth (5th) day of every
calendar month, provided that the rentals for the first four (4) months shall be
paid by the LESSEE in advance upon the signing of this Contract.
3. The LESSEE is hereby authorized to construct as its sole expense a building
and such other improvements on said parcel of land, which it may need in
pursuance of its business and/or operations; provided, that if for any reason the
LESSEE shall fail to exercise its option mentioned in paragraph (1) above in case
the parcel of land is registered under the TORRENS SYSTEM within the ten-year
period mentioned therein, said building and/or improvements, shall become
 the property of the LESSOR after the expiration of the 25-year lease period
without the right of reimbursement on the part of the LESSEE. The authority
herein granted does not, however, extend to the making or allowing any
unlawful, improper or offensive used of the leased premises, or any use thereof,
other than banking and office purposes. The maintenance and upkeep of such
building, structure and improvements shall likewise be for the sole account of
the LESSEE. 1
The foregoing agreement was subscribed before Notary Public Romeo F. Natividad.
Pursuant to said contract, a building and other improvements were constructed on the land
which housed the branch office of RCBC in Masbate, Masbate. Within three years from the
signing of the contract, petitioner complied with his part of the agreement by having the
property registered and
placed under the TORRENS SYSTEM, for which Original Certificate of Title No. 0-232 was issued
by the Register of Deeds of the Province of Masbate.
Petitioner alleges that as soon as he had the property registered, he kept on pursuing the
manager of the branch to effect the sale of the lot as per their agreement. It was not until
September 4, 1984, however, when the respondent bank decided to exercise its option and
informed petitioner, through a letter, 2 of its intention to buy the property at the agreed price of
not greater than P210.00 per square meter or a total of P78,430.00. But much to the surprise of
the respondent, petitioner replied that he is no longer selling the property. 3
Hence, on March 14, 1985, a complaint for specific performance and damages were filed by
respondent against petitioner. In the complaint, respondent alleged that during the negotiations
it made clear to petitioner that it intends to stay permanently on property once its branch office
is opened unless the exigencies of the business requires otherwise. Aside from its prayer for
specific performance, it likewise asked for an award of P50,000.00 for attorney's fees
P100,000.00 as exemplary damages and the cost of the suit.4
A special and affirmative defenses, petitioner contended:
1. That the contract having been prepared and drawn by RCBC, it took undue
advantage on him when it set in lopsided terms.
2. That the option was not supported by any consideration distinct from the
price and hence not binding upon him.
3. That as a condition for the validity and/or efficacy of the option, it should
have been exercised within the reasonable time after the registration of the land
under the Torrens System; that its delayed action on the option have forfeited
whatever its claim to the same.
4. That extraordinary inflation supervened resulting in the unusual decrease in
the purchasing power of the currency that could not reasonably be forseen or
was manifestly beyond the contemplation of the parties at the time of the
establishment of the obligation, thus, rendering the terms of the contract
unenforceable, inequitable and to the undue enrichment of RCBC. 5
and as counterclaim petitioner alleged that:
1. The rental of P700.00 has become unrealistic and unreasonable, that justice
and equity will require its adjustment.
2. By the institution of the complaint he suffered moral damages which may be
assessed at P100,000.00 and award of attorney's fee of P25,000.00 and
exemplary damages at P100,000.00.6
Initially, after trial on the merits, the court dismissed the complaint. Although it found the
contract to be valid, the court nonetheless ruled that the option to buy in unenforceable because
it lacked a consideration distinct from the price and RCBC did not exercise its option within
reasonable time. The prayer for readjustment of rental was denied, as well as that for moral and
exemplary damages.7
Nevertheless, upon motion for reconsideration of respondent, the court in the order of January 9,
1989, reversed itself, the dispositive portion reads:
WHEREFORE, the Court reconsiders its decision dated June 6, 1988, and hereby
renders judgment as follows:
1. The defendant is hereby ordered to execute and deliver the proper deed of
sale in favor of plaintiff selling, transferring and
conveying the property covered by and described in the Original Certificate of
Title 0-232 of the Registry of Deeds of Masbate for the sum of Seventy Eight
Thousand Five Hundred Forty Pesos (P78,540,00), Philippine Currency;
 2. Defendant is ordered to pay plaintiff the sum of Five Thousand (P5,000.00)
Pesos as attorney's fees;
3. The counter claim of defendant is hereby dismissed; and
4. Defendants shall pay the costs of suit.8
In a decision promulgated on September 19, 1991,9 the Court of Appeals affirmed the findings of
the trial court that:
1. The contract is valid and that the parties perfectly understood the contents
thereof;
2. The option is supported by a distinct and separate consideration as embodied
in the agreement;
3. There is no basis in granting an adjustment in rental.
Assailing the judgment of the appellate court, petitioner would like us to consider mainly the
following:
1. The disputed contract is a contract of adhesion.
2. There was no consideration to support the option, distinct from the price,
hence the option cannot be exercised.
3. Respondent court gravely abused its discretion in not granting currency
adjustment on the already eroded value of the stipulated rentals for twenty-five
years.
The petition is devoid of merit.
There is no dispute that the contract is valid and existing between the parties, as found by both
the trial court and the appellate court. Neither do we find the terms of the contract unfairly
lopsided to have it ignored.
A contract of adhesion is one wherein a party, usually a corporation, prepares the stipulations in
the contract, while the other party merely affixes his signature or his "adhesion" thereto. These
types of contracts are as binding as ordinary contracts. Because in reality, the party who adheres
to the contract is free to reject it entirely. Although, this Court will not hesitate to rule out blind
adherence to terms where facts and circumstances will show that it is basically one-sided. 10
We do not find the situation in the present case to be inequitable. Petitioner is a highly educated
man, who, at the time of the trial was already a CPA-Lawyer, and when he entered into the
contract, was already a CPA, holding a respectable position with the Metropolitan Manila
Commission. It is evident that a man of his stature should have been more cautious in
transactions he enters into, particularly where it concerns valuable properties. He is amply
equipped to drive a hard bargain if he would be so minded to.
Petitioner contends that the doctrines laid down in the cases of
Atkins Kroll v. Cua Hian Tek, 11 Sanchez v. Rigos, 12 and Vda. de Quirino v. Palarca 13 were
misapplied in the present case, because 1) the option given to the respondent bank was not
supported by a consideration distinct from the price; and 2) that the stipulated price of "not
greater than P210.00 per square meter" is not certain or definite.
Article 1324 of the Civil Code provides that when an offeror has allowed the offeree a certain
period to accept, the offer maybe withdrawn at anytime before acceptance by communicating
such withdrawal, except when the option is founded upon consideration, as something paid or
promised. On the other hand, Article 1479 of the Code provides that an accepted unilateral
promise to buy and sell a determinate thing for a price certain is binding upon the promisor if the
promise is supported by a consideration distinct from the price.
In a unilateral promise to sell, where the debtor fails to withdraw the promise before the
acceptance by the creditor, the transaction becomes a bilateral contract to sell and to buy,
because upon acceptance by the creditor of the offer to sell by the debtor, there is already a
meeting of the minds of the parties as to the thing which is determinate and the price which is
certain. 14 In which case, the parties may then reciprocally demand performance.
Jurisprudence has taught us that an optional contract is a privilege existing only in one party
the buyer. For a separate consideration paid, he is given the right to decide to purchase or not, a
certain merchandise or property, at any time within the agreed period, at a fixed price. This
being his prerogative, he may not be compelled to exercise the option to buy before the time
expires. 15
On the other hand, what may be regarded as a consideration separate from the price is discussed
in the case of Vda. de Quirino v. Palarca 16 wherein the facts are almost on all fours with the case
at bar. The said case also involved a lease contract with option to buy where we had occasion to
say that "the consideration for the lessor's obligation to sell the leased premises to the lessee,
should he choose to exercise his option to purchase the same, is the obligation of the lessee to
sell to the lessor the building and/or improvements constructed and/or made by the former, if
he fails to exercise his option to buy leased premises." 17
In the present case, the consideration is even more onerous on the part of the lessee since it
entails transferring of the building and/or improvements on the property to petitioner, should
respondent bank fail to exercise its option within the period stipulated. 18
The bugging question then is whether the price "not greater than TWO HUNDRED PESOS" is
certain or definite. A price is considered certain if it is so with reference to another thing certain
or when the determination thereof is left to the judgment of a specified person or persons. 19 And
generally, gross inadequacy of price does not affect a contract of sale. 20
Contracts are to be construed according to the sense and meaning of the terms which the parties
themselves have used. In the present dispute, there is evidence to show that the intention of the
parties is to peg the price at P210 per square meter. This was confirmed by petitioner himself in
his testimony, as follows:
Q. Will you please tell this Court what was the offer?
A. It was an offer to buy the property that I have in Quezon City
(sic).
Q. And did they give you a specific amount?
xxx xxx xxx
A. Well, there was an offer to buy the property at P210 per
square meters (sic).
Q. And that was in what year?
A . 1975, sir.
Q. And did you accept the offer?
A. Yes, sir. 21
Moreover, by his subsequent acts of having the land titled under the Torrens System, and in
pursuing the bank manager to effect the sale immediately, means that he understood perfectly
the terms of the contract. He even had the same property mortgaged to the respondent bank
sometime in 1979, without the slightest hint of wanting to abandon his offer to sell the property
at the agreed price of P210 per square meter. 22
Finally, we agree with the courts a quo that there is no basis, legal or factual, in adjusting the
amount of the rent. The contract is the law between the parties and if there is indeed reason to
adjust the rent, the parties could by themselves negotiate for the amendment of the contract.
Neither could we consider the decline of the purchasing power of the Philippine peso from 1983
to the time of the commencement of the present case in 1985, to be so great as to result in an
extraordinary inflation. Extraordinary inflation exists when there in an unimaginable increase or
decrease of the purchasing power of the Philippine currency, or fluctuation in the value of pesos
manifestly beyond the contemplation of the parties at the time of the establishment of the
obligation. 23
Premises considered, we find that the contract of "LEASE WITH OPTION TO BUY" between
petitioner and respondent bank is valid, effective and enforceable, the price being certain and
that there was consideration distinct from the price to support the option given to the lessee.
WHEREFORE, this petition is hereby DISMISSED, and the decision of the appellate court is
hereby AFFIRMED.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 198680 July 8, 2013
HEIRS OF MAGDALENO YPON, NAMELY, ALVARO YPON, ERUDITA Y. BARON, CICERO YPON,
WILSON YPON, VICTOR YPON, AND HINIDINO Y. PEALOSA, PETITIONERS,
vs.
GAUDIOSO PONTERAS RICAFORTE A.K.A. "GAUDIOSO E. YPON," AND THE REGISTER OF
DEEDS OF TOLEDO CITY, RESPONDENTS.
RESOLUTION
PERLAS-BERNABE, J.:
This is a direct recourse to the Court from the Regional Trial Court of Toledo City, Branch 59
(RTC), through a petition for review on certiorari1 under Rule 45 of the Rules of Court, raising a
pure question of law. In particular, petitioners assail the July 27, 2011 2 and August 31,
20113 Orders of the RTC, dismissing Civil Case No. T-2246 for lack of cause of action.
The Facts
On July 29, 2010, petitioners, together with some of their cousins,4 filed a complaint for
Cancellation of Title and Reconveyance with Damages (subject complaint) against respondent
Gaudioso Ponteras Ricaforte a.k.a. "Gaudioso E. Ypon" (Gaudioso), docketed as Civil Case No. T-
2246.5 In their complaint, they alleged that Magdaleno Ypon (Magdaleno) died intestate and
childless on June 28, 1968, leaving behind Lot Nos. 2-AA, 2-C, 2-F, and 2-J which were then
covered by Transfer Certificates of Title (TCT) Nos. T-44 and T-77-A.6 Claiming to be the sole heir
of Magdaleno, Gaudioso executed an Affidavit of Self-Adjudication and caused the cancellation of
the aforementioned certificates of title, leading to their subsequent transfer in his name under
TCT Nos. T-2637 and T-2638,7 to the prejudice of petitioners who are Magdalenos collateral
relatives and successors-in-interest.8
In his Answer, Gaudioso alleged that he is the lawful son of Magdaleno as evidenced by: (a) his
certificate of Live Birth; (b) two (2) letters from Polytechnic School; and (c) a certified true copy
of his passport.9 Further, by way of affirmative defense, he claimed that: (a) petitioners have no
cause of action against him; (b) the complaint fails to state a cause of action; and (c) the case is
not prosecuted by the real parties-in-interest, as there is no showing that the petitioners have
been judicially declared as Magdalenos lawful heirs.10
The RTC Ruling
On July 27, 2011, the RTC issued the assailed July 27, 2011 Order,11 finding that the subject
complaint failed to state a cause of action against Gaudioso. It observed that while the plaintiffs
therein had established their relationship with Magdaleno in a previous special proceeding for
the issuance of letters of administration,12 this did not mean that they could already be
considered as the decedents compulsory heirs. Quite the contrary, Gaudioso satisfactorily
established the fact that he is Magdalenos son and hence, his compulsory heir through the
documentary evidence he submitted which consisted of: (a) a marriage contract between
Magdaleno and Epegenia Evangelista; (b) a Certificate of Live Birth; (c) a Letter dated February
19, 1960; and (d) a passport.13
The plaintiffs therein filed a motion for reconsideration which was, however, denied on August
31, 2011 due to the counsels failure to state the date on which his Mandatory Continuing Legal
Education Certificate of Compliance was issued.14
Aggrieved, petitioners, who were among the plaintiffs in Civil Case No. T-2246,15 sought direct
recourse to the Court through the instant petition.
The Issue Before the Court
The core of the present controversy revolves around the issue of whether or not the RTCs
dismissal of the case on the ground that the subject complaint failed to state a cause of action
was proper.
The Courts Ruling
The petition has no merit.
Cause of action is defined as the act or omission by which a party violates a right of another.16 It
is well-settled that the existence of a cause of action is determined by the allegations in the
complaint.17 In this relation, a complaint is said to assert a sufficient cause of action if, admitting
what appears solely on its face to be correct, the plaintiff would be entitled to the relief prayed
for.18Accordingly, if the allegations furnish sufficient basis by which the complaint can be
maintained, the same should not be dismissed, regardless of the defenses that may be averred by
the defendants.19
As stated in the subject complaint, petitioners, who were among the plaintiffs therein, alleged
that they are the lawful heirs of Magdaleno and based on the same, prayed that the Affidavit of
Self-Adjudication executed by Gaudioso be declared null and void and that the transfer
certificates of title issued in the latters favor be cancelled. While the foregoing allegations, if
admitted to be true, would consequently warrant the reliefs sought for in the said complaint, the
rule that the determination of a decedents lawful heirs should be made in the corresponding
special proceeding20 precludes the RTC, in an ordinary action for cancellation of title and
reconveyance, from granting the same. In the case of Heirs of Teofilo Gabatan v. CA, 21 the Court,
citing several other precedents, held that the determination of who are the decedents lawful
heirs must be made in the proper special proceeding for such purpose, and not in an ordinary
suit for recovery of ownership and/or possession, as in this case:
Jurisprudence dictates that the determination of who are the legal heirs of the deceased must be
made in the proper special proceedings in court, and not in an ordinary suit for recovery of
ownership and possession of property.1wphi1 This must take precedence over the action for
recovery of possession and ownership. The Court has consistently ruled that the trial court
cannot make a declaration of heirship in the civil action for the reason that such a declaration can
only be made in a special proceeding. Under Section 3, Rule 1 of the 1997 Revised Rules of Court,
a civil action is defined as one by which a party sues another for the enforcement or protection of
a right, or the prevention or redress of a wrong while a special proceeding is a remedy by which
a party seeks to establish a status, a right, or a particular fact. It is then decisively clear that the
declaration of heirship can be made only in a special proceeding inasmuch as the petitioners
here are seeking the establishment of a status or right.
By way of exception, the need to institute a separate special proceeding for the determination of
heirship may be dispensed with for the sake of practicality, as when the parties in the civil case
had voluntarily submitted the issue to the trial court and already presented their evidence
regarding the issue of heirship, and the RTC had consequently rendered judgment thereon, 23 or
when a special proceeding had been instituted but had been finally closed and terminated, and
hence, cannot be re-opened.24
In this case, none of the foregoing exceptions, or those of similar nature, appear to exist. Hence,
there lies the need to institute the proper special proceeding in order to determine the heirship
of the parties involved, ultimately resulting to the dismissal of Civil Case No. T-2246.
Verily, while a court usually focuses on the complaint in determining whether the same fails to
state a cause of action, a court cannot disregard decisions material to the proper appreciation of
the questions before it.25 Thus, concordant with applicable jurisprudence, since a determination
of heirship cannot be made in an ordinary action for recovery of ownership and/or possession,
the dismissal of Civil Case No. T-2246 was altogether proper. In this light, it must be pointed out
that the RTC erred in ruling on Gaudiosos heirship which should, as herein discussed, be
threshed out and determined in the proper special proceeding. As such, the foregoing
pronouncement should therefore be devoid of any legal effect.
WHEREFORE, the petition is DENIED. The dismissal of Civil Case No. T-2246 is hereby
AFFIRMED, without prejudice to any subsequent proceeding to determine the lawful heirs of the
late Magdaleno Ypon and the rights concomitant therewith.
SO ORDERED.

In the early case of Litam, et al. v. Rivera, this Court ruled that the declaration of heirship must be
made in a special proceeding, and not in an independent civil action. This doctrine was reiterated
in Solivio v. Court of Appeals x x x:

In the more recent case of Milagros Joaquino v. Lourdes Reyes, the Court reiterated its ruling that
matters relating to the rights of filiation and heirship must be ventilated in the proper probate
court in a special proceeding instituted precisely for the purpose of determining such rights.
Citing the case of Agapay v. Palang, this Court held that the status of an illegitimate child who
claimed to be an heir to a decedent's estate could not be adjudicated in an ordinary civil action
which, as in this case, was for the recovery of property.22 (Emphasis and underscoring supplied;
citations omitted)
 Area--------------------------------------------------------793 square meters
Area sought to be-----------------------------------------478 square meters expropriated
FIRST DIVISION Tax Declaration-------------------------------------------03450
Title No. ---------------------------------------------------31832
Market value for the whole lot--------------------------P1,666,530.00
Market value of the Area to be expropriated----------P100,380.00
[G.R. No. 142971. May 7, 2002] Assessed Value--------------------------------------------P49,960.00

for a public purpose, i.e., for the construction of a public road which shall serve as an
access/relief road of Gorordo Avenue to extend to the General Maxilum Avenue and the back of
THE CITY OF CEBU, petitioner, vs. SPOUSES APOLONIO and BLASA DEDAMO, respondents. Magellan International Hotel Roads in Cebu City. The lots are the most suitable site for the
purpose. The total area sought to be expropriated is 1,624 square meters with an assessed value
DECISION of P1,786,400. Petitioner deposited with the Philippine National Bank the amount of P51,156
representing 15% of the fair market value of the property to enable the petitioner to take
DAVIDE, JR., C.J.: immediate possession of the property pursuant to Section 19 of R.A. No. 7160.[2]

In its petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure,
petitioner City of Cebu assails the decision of 11 October 1999 of the Court of Appeals in CA-G.R.
CV No. 59204[1] affirming the judgment of 7 May 1996 of the Regional Trial Court, Branch 13,
Cebu City, in Civil Case No. CEB-14632, a case for eminent domain, which fixed the valuation of
the land subject thereof on the basis of the recommendation of the commissioners appointed by
it.
The material operative facts are not disputed.
On 17 September 1993, petitioner City of Cebu filed in Civil Case No. CEB-14632 a
complaint for eminent domain against respondents spouses Apolonio and Blasa Dedamo. The
petitioner alleged therein that it needed the following parcels of land of respondents, to wit:
Lot No. 1527
Area----------------------------1,146 square meters
Tax Declaration---------------03472
Title No.-----------------------31833
Market value------------------P240,660.00
Assessed Value---------------P72,200.00
Lot No. 1528
Respondents, filed a motion to dismiss the complaint because the purpose for which their
property was to be expropriated was not for a public purpose but for benefit of a single private
entity, the Cebu Holdings, Inc. Petitioner could simply buy directly from them the property at its
fair market value if it wanted to, just like what it did with the neighboring lots. Besides, the price
offered was very low in light of the consideration of P20,000 per square meter, more or less,
which petitioner paid to the neighboring lots. Finally, respondents alleged that they have no
other land in Cebu City.
A pre-trial was thereafter had.
On 23 August 1994, petitioner filed a motion for the issuance of a writ of possession
pursuant to Section 19 of R.A. No. 7160. The motion was granted by the trial court on 21
September 1994.[3]
On 14 December 1994, the parties executed and submitted to the trial court an
Agreement[4] wherein they declared that they have partially settled the case and in consideration
thereof they agreed:
1. That the SECOND PARTY hereby conforms to the intention to [sic] the FIRST PARTY
in expropriating their parcels of land in the above-cited case as for public purpose
and for the benefit of the general public;
2. That the SECOND PARTY agrees to part with the ownership of the subject parcels of
land in favor of the FIRST PARTY provided the latter will pay just compensation for
the same in the amount determined by the court after due notice and hearing;
 3. That in the meantime the SECOND PARTY agrees to receive the amount of ONE
MILLION SEVEN HUNDRED EIGHTY SIX THOUSAND FOUR HUNDRED PESOS
(1,786,400.00) as provisional payment for the subject parcels of land, without
prejudice to the final valuation as maybe determined by the court;
4. That the FIRST PARTY in the light of the issuance of the Writ of Possession Order
dated September 21, 1994 issued by the Honorable Court, agreed to take
possession over that portion of the lot sought to be expropriated where the house
of the SECOND PARTY was located only after fifteen (15) days upon the receipt of
the SECOND PARTY of the amount of P1,786,400.00;
5. That the SECOND PARTY upon receipt of the aforesaid provisional amount, shall
turn over to the FIRST PARTY the title of the lot and within the lapse of the fifteen
(15) days grace period will voluntarily demolish their house and the other
structure that may be located thereon at their own expense;
6. That the FIRST PARTY and the SECOND PARTY jointly petition the Honorable Court
to render judgment in said Civil Case No. CEB-14632 in accordance with this
AGREEMENT;
7. That the judgment sought to be rendered under this agreement shall be followed by
a supplemental judgment fixing the just compensation for the property of the
SECOND PARTY after the Commissioners appointed by this Honorable Court to
determine the same shall have rendered their report and approved by the court.
Pursuant to said agreement, the trial court appointed three commissioners to determine the
just compensation of the lots sought to be expropriated. The commissioners were Palermo M.
Lugo, who was nominated by petitioner and who was designated as Chairman; Alfredo Cisneros,
who was nominated by respondents; and Herbert E. Buot, who was designated by the trial
court. The parties agreed to their appointment.
Thereafter, the commissioners submitted their report, which contained their respective
assessments of and recommendation as to the valuation of the property.
On the basis of the commissioners report and after due deliberation thereon, the trial court
rendered its decision on 7 May 1996,[5] the decretal portion of which reads:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in accordance with the
report of the commissioners.
Plaintiff is directed to pay Spouses Apolonio S. Dedamo and Blasa Dedamo the sum of pesos:
TWENTY FOUR MILLION EIGHT HUNDRED SIXTY-FIVE THOUSAND AND NINE HUNDRED
THIRTY (P24,865.930.00) representing the compensation mentioned in the Complaint.
Plaintiff and defendants are directed to pay the following commissioners fee;
1. To Palermo Lugo - P21,000.00
2. To Herbert Buot - P19,000.00
3. To Alfredo Cisneros - P19,000.00
Without pronouncement as to cost.
SO ORDERED.
Petitioner filed a motion for reconsideration on the ground that the commissioners report
was inaccurate since it included an area which was not subject to expropriation. More
specifically, it contended that Lot No. 1528 contains 793 square meters but the actual area to be
expropriated is only 478 square meters. The remaining 315 square meters is the subject of a
separate expropriation proceeding in Civil Case No. CEB-8348, then pending before Branch 9 of
the Regional Trial Court of Cebu City.
On 16 August 1996, the commissioners submitted an amended assessment for the 478
square meters of Lot No. 1528 and fixed it at P12,824.10 per square meter, or in the amount
of P20,826,339.50. The assessment was approved as the just compensation thereof by the trial
court in its Order of 27 December 1996.[6] Accordingly, the dispositive portion of the decision
was amended to reflect the new valuation.
Petitioner elevated the case to the Court of Appeals, which docketed the case as CA-G.R. CV
No. 59204. Petitioner alleged that the lower court erred in fixing the amount of just
compensation at P20,826,339.50. The just compensation should be based on the prevailing
market price of the property at the commencement of the expropriation proceedings.
The petitioner did not convince the Court of Appeals. In its decision of 11 October
1999,[7] the Court of Appeals affirmed in toto the decision of the trial court.
Still unsatisfied, petitioner filed with us the petition for review in the case at bar. It raises
the sole issue of whether just compensation should be determined as of the date of the filing of
the complaint. It asserts that it should be, which in this case should be 17 September 1993 and
not at the time the property was actually taken in 1994, pursuant to the decision in National
Power Corporation vs. Court of Appeals.[8]
 In their Comment, respondents maintain that the Court of Appeals did not err in affirming
the decision of the trial court because (1) the trial court decided the case on the basis of the
agreement of the parties that just compensation shall be fixed by commissioners appointed by
the court; (2) petitioner did not interpose any serious objection to the commissioners report of
12 August 1996 fixing the just compensation of the 1,624-square meter lot at P20,826,339.50;
hence, it was estopped from attacking the report on which the decision was based; and (3) the
determined just compensation fixed is even lower than the actual value of the property at the
time of the actual taking in 1994.
Eminent domain is a fundamental State power that is inseparable from sovereignty. It is the
Governments right to appropriate, in the nature of a compulsory sale to the State, private
property for public use or purpose.[9] However, the Government must pay the owner thereof just
compensation as consideration therefor.
In the case at bar, the applicable law as to the point of reckoning for the determination of
just compensation is Section 19 of R.A. No. 7160, which expressly provides that just
compensation shall be determined as of the time of actual taking.The Section reads as follows:
SECTION 19. Eminent Domain. -- A local government unit may, through its chief executive and
acting pursuant to an ordinance, exercise the power of eminent domain for public use, or
purpose or welfare for the benefit of the poor and the landless, upon payment of just
compensation, pursuant to the provisions of the Constitution and pertinent laws: Provided,
however, That the power of eminent domain may not be exercised unless a valid and definite
offer has been previously made to the owner, and such offer was not accepted: Provided,
further, That the local government unit may immediately take possession of the property upon
the filing of the expropriation proceedings and upon making a deposit with the proper court of at
least fifteen percent (15%) of the fair market value of the property based on the current tax
declaration of the property to be expropriated: Provided finally, That, the amount to be paid for
the expropriated property shall be determined by the proper court, based on the fair market
value at the time of the taking of the property.
The petitioner has misread our ruling in The National Power Corp. vs. Court of
Appeals.[10] We did not categorically rule in that case that just compensation should be
determined as of the filing of the complaint. We explicitly stated therein that although the
general rule in determining just compensation in eminent domain is the value of the property as
of the date of the filing of the complaint, the rule admits of an exception: where this Court fixed
the value of the property as of the date it was taken and not at the date of the commencement of
the expropriation proceedings.
Also, the trial court followed the then governing procedural law on the matter, which was
Section 5 of Rule 67 of the Rules of Court, which provided as follows:
SEC. 5. Ascertainment of compensation. -- Upon the entry of the order of condemnation, the court
shall appoint not more than three (3) competent and disinterested persons as commissioners to
ascertain and report to the court the just compensation for the property sought to be taken. The
order of appointment shall designate the time and place of the first session of the hearing to be
held by the commissioners and specify the time within which their report is to be filed with the
court.
More than anything else, the parties, by a solemn document freely and voluntarily agreed
upon by them, agreed to be bound by the report of the commission and approved by the trial
court. The agreement is a contract between the parties. It has the force of law between them and
should be complied with in good faith. Article 1159 and 1315 of the Civil Code explicitly
provides:
Art. 1159. Obligations arising from contracts have the force of law between the contracting
parties and should be complied with in good faith.
Art. 1315. Contracts are perfected by mere consent, and from that moment the parties are bound
not only to the fulfillment of what has been expressly stipulated but also to all the consequences
which, according to their nature, may be in keeping with good faith, usage and law.
Furthermore, during the hearing on 22 November 1996, petitioner did not interpose a
serious objection.[11] It is therefore too late for petitioner to question the valuation now without
violating the principle of equitable estoppel. Estoppel in pais arises when one, by his acts,
representations or admissions, or by his own silence when he ought to speak out, intentionally or
through culpable negligence, induces another to believe certain facts to exist and such other
rightfully relies and acts on such belief, so that he will be prejudiced if the former is permitted to
deny the existence of such facts.[12] Records show that petitioner consented to conform with the
valuation recommended by the commissioners. It cannot detract from its agreement now and
assail correctness of the commissioners assessment.
Finally, while Section 4, Rule 67 of the Rules of Court provides that just compensation shall
be determined at the time of the filing of the complaint for expropriation, [13]such law cannot
prevail over R.A. 7160, which is a substantive law.[14]
WHEREFORE, finding no reversible error in the assailed judgment of the Court of Appeals
in CA-G.R. CV No. 59204, the petition in this case is hereby DENIED.
No pronouncement as to costs.
SO ORDERED.