DOMINADOR B. BUSTOS vs. ANTONIO G.
LUCERO Evidence is the mode and manner of proving
FACTS:
The petitioner herein, an accused in a criminal
case, filed a motion with the CFI of Pampanga
after he had been bound over to that court for
trial, praying that the record of the case be
remanded to the justice of the peace court of
Masantol, the court of origin, in order that the
petitioner might cross-examine the complainant
and her witnesses in connection with their
testimony, on the strength of which warrant was
issued for the arrest of the accused. The accused,
assisted by counsel, appeared at the preliminary
investigation. In that investigation, the justice of
the peace informed him of the charges and asked
him if he pleaded guilty or not guilty, upon which
he entered the plea of not guilty.
Then his counsel moved that the complainant
present her evidence so that she and her
witnesses could be examined and cross-
examined in the manner and form provided by
law. The fiscal and the private prosecutor
objected, invoking section 11 of rule 108, and the
objection was sustained. In view thereof, the
accused's counsel announced his intention to
renounce his right to present evidence, and the
justice of the peace forwarded the case to the
court of first instance.
ISSUE:
Whether or not the Justice of the Peace court of
Masantol committed grave abuse of discretion in
refusing to grant the accused's motion to return
the record.
HELD:
competent facts and circumstances on which a
party relies to establish the fact in dispute in
judicial proceedings. It is fundamentally a
procedural law. The Supreme Court that section
11 of Rule 108 does not curtail the sound
discretion of the justice of the peace on the
matter. Said section defines the bounds of the
defendant's right in the preliminary investigation,
there is nothing in it or any other law restricting
the authority, inherent in a court of justice, to
pursue a course of action reasonably calculated
to bring out the truth.
The foregoing decision was rendered by a divided
court. The minority went farther than the
majority and denied even any discretion on the
part of the justice of the peace or judge holding
the preliminary investigation to compel the
complainant and his witnesses to testify anew.
Upon the foregoing considerations, the present
petition is dismissed with costs against the
petitioner.
FIRST LEPANTO CERAMIC V MARIWASA AND CA
FACTS:
Petitioner assailed the conflicting provisions of
B.P. 129, EO 226 (Art. 82) and a circular, 1-91
issued by the Supreme Court which deals with
the jurisdiction of courts for appeal of cases
decided by quasi-judicial agencies such as the
Board of Investments (BOI).
BOI granted petitioner First Lepanto Ceramics,
Inc.'s application to amend its BOI certificate of
registration by changing the scope of its
registered product from "glazed floor tiles" to
"ceramic tiles." Oppositor Mariwasa filed a
motion for reconsideration of the said BOI
decision while oppositor Fil-Hispano Ceramics,
Inc. did not move to reconsider the same nor
appeal therefrom. Soon rebuffed in its bid for
reconsideration, Mariwasa filed a petition for
review with CA.
CA temporarily restrained the BOI from
implementing its decision. The TRO lapsed by its
own terms twenty (20) days after its issuance,
without respondent court issuing any preliminary
injunction.
Petitioner filed a motion to dismiss and to lift the
restraining order contending that CA does not
have jurisdiction over the BOI case, since the
same is exclusively vested with the Supreme
Court pursuant to Article 82 of the Omnibus
Investments Code of 1987.
Petitioner argued that the Judiciary
Reorganization Act of 1980 or B.P. 129 and
Circular 1-91, "Prescribing the Rules Governing
Appeals to the Court of Appeals from a Final
Order or Decision of the Court of Tax Appeals and
Quasi-Judicial Agencies" cannot be the basis of
Mariwasa's appeal to respondent court because
the procedure for appeal laid down therein runs
contrary to Article 82 of E.O. 226, which provides
that appeals from decisions or orders of the BOI
shall be filed directly with the Supreme Court.
While Mariwasa maintains that whatever
inconsistency there may have been between B.P.
129 and Article 82 of E.O. 226 on the question of
venue for appeal, has already been resolved by
Circular 1-91 of the Supreme Court, which was
promulgated on February 27, 1991 or four (4)
years after E.O. 226 was enacted.
ISSUE:
Whether or not the Court of Appeals has
jurisdiction over the case
RULING:
YES. Circular 1-91 effectively repealed or
superseded Article 82 of E.O. 226 insofar as the
manner and method of enforcing the right to
appeal from decisions of the BOI are concerned.
Appeals from decisions of the BOI, which by
statute was previously allowed to be filed directly
with the Supreme Court, should now be brought
to the Court of Appeals.
MARIANO ALBER V UNIVERSITY PUBLISHING CO.,
INC.
BENGZON, J.P. J. | 1965
FACTS:
No less than three times have the parties here
appealed to this Court.
In 1949, Albert sued University Publishing Co.
(UPC). He alleged that UPC was organized and
existing under PH laws and that thru its president
Jose Aruego (Aruego), they entered into a
contract where UPC would pay him 30 thousand
pesos for the exclusive right to publish his revised
Commentaries on the RPC and for his share in
previous sales of the books 1st edition; that UPC
undertook to pay in 8 instalments of 3.5k and
failure to pay one instalment would render the
rest due
Albert said UPC failed to pay the 2nd instalment
but the latter countered that it was the former
who violated their contract by his failure to
deliver the manuscript.
Later, Albert died and Justo Albert (his
administrator) substituted him. The CFI then
favoured Justo and ordered UPC to pay him 23
thousand. The cases went to SC which reduced it
to 15 thousand pesos.
The CFI then ordered for the execution against
UPC but at some point, Justo petitioned for a writ
of execution against Aruego (its president)
because he and the sheriff discovered that UPC
wasnt registered in the SEC. UPC countered by
saying that Aruego was not a party to the case so
the petition should be denied.
SC notes that UPC doesnt want Aruego to be a
party to the case because if hes not a party, a
separate action will have to be filed by Justo
which will result in him dealing with the statute
of limitations.
The CFI denied the petition so Justo appealed.
ISSUE:
W/N Aruego considered a party in the case.
RULING:
Yes, Aruego is a party in the case.
Ratio:
Non-registration of UPC is undisputed. Hence, on
account of the non-registration it cannot be
considered a corporation, not even a
corporation de facto; UPC then has no
personality separate from Aruego, thus cannot
be sued independently;
Corporation-by-estoppel not invoked by UPC.
Even if invoked, its not applicable;
Aruego represented a non-existent entity and
induced not only Justo but also the court to
believe such representation; (he signed the
contract as president and stated the UPC was
registered);
One who has induced another to act upon his
wilful misrepresentation that a corporation was
duly organized and existing under the law, cannot
thereafter set up against his victim the principle
of corporation by estoppel (Salvatiera vs.
Garlitos, 56 O.G. 3069);
Aruego is the real defendant because it is UPC
who came to the court, but as said, it does not
have independent personaility; it is just a name;
In reality, it was Aruego, in reality, the one who
answered and litigated, through his own law firm
as counsel;
On Agency, a person acting or purporting to act
on behalf of a corporation which has no valid
existence assumes such privileges and
obligations and becomes personally liable for
contracts entered into or for other acts
performed as such agent;
On the issue of due process (since Aruego wasnt
named in the case), Aruego was given his day in
court;
Parties to a suit are "persons who have a right to
control the proceedings, to make defense, to
adduce and cross-examine witnesses, and to
appeal from a decision; in reality, it was Aruego
who exercised these rights;
By due process of law we mean a law which hears
before it condemns; which proceeds upon
inquiry, and renders judgment only after trial;
Summary: The evidence is patently clear that Jose
M. Aruego, acting as representative of a non-
existent principal, was the real party to the
contract sued upon; that he was the one who
reaped the benefits resulting from it, so much so
that partial payments of the consideration were
made by him; that he violated its terms, thereby
precipitating the suit in question; and that in the
litigation he was the real defendant.
CASE REMANDED: Lower court to hold
supplementary proceedings for the purpose of
carrying the judgment into effect against
University Publishing Co., Inc. and/or Jose M.
Aruego (because others might be liable to him for
reimbursement or contribution.)
ALVERO V. DELA ROSA
FACTS:
On June 25, 1945, respondent Jose R. Victoriano
had filed a complaint, in the Court of First
Instance of the City of Manila, against petitioner
Fredesvindo S. Alvero and one Margarita Villarica,
alleging two causes of action:
(1) to declare in force the contract of sale,
between said Jose R. Victoriano and Margarita
Villarica, of two parcels of land in the Manotoc
subdivision, Balintawak, in the barrio of Calaanan,
municipality of Caloocan, Province of Rizal, which
land was subsequently sold by said Villarica, in
favor of petitioner Fredesvindo S. Alvero, on
December 31, 1944, for the sum of P100,000 in
Japanese military notes; and
(2) to declare said subsequent sale null and void.
On July 7, 1945, Margarita Villarica filed an
answer to said complaint, expressly admitting
having sold said land to Fresdesvindo S. Alvero,
for P100,000, in December, 1944, due to the
necessity of raising funds with which to provide
for herself and family, and that she did not
remember the previous sale; at the same time,
offering to repurchase said land from
Fredesvindo S. Alvero in the sum of P5,000, but
that the latter refused to accept the offer.
Jose R. Victoriano filed an answer to said
counterclaim, denying Fredesvindo S. Alvero's
alleged ownership over said land, and the other
allegations contained in Alvero's answer.
On July 13, 1945, Fredesvindo S. Alvero, in
answering said complaint, denied the allegations
and claimed exclusive ownership of the land in
question.
Hon. Mariano L. de la Rosa, Judge of the Court of
First Instance of the City of Manila, one of the
respondents in this case, rendered his decision, in
which it was declared that the two parcels of land
in question had been sold by Margarita Villarica
to Jose R. Victoriano and that Victoriano
continued making monthly payments until
December, 1941, but that owing to the war-time
conditions then existing, Margarita Villarica
agreed verbally to suspend such payments until
the restoration of peace and that Margarita
Villarica, having forgotten the sale of said land to
Jose R. Victoriano, sold the same for P100,000 in
Japanese military notes, on December 31, 1944,
to Fredesvindo S. Alvero, but afterwards offered
to repurchase said property from him, for the
sum of P8,000 in genuine Philippine currency,
after liberation.
Jose R. Victoriano had presented the deed of sale
which was older than that of Fredesvindo S.
Alvero, the respondent judge rendered his
decision in favor of Jose R. Victoriano, adjudging
to him the title over the property in question,
including all the improvements existing thereon,
and dismissed the counterclaim.
On November 28, 1945, Fredesvindo S. Alvero
was notified of said decision; and on December
27, 1945, he filed a petition for reconsideration
and new trial, which was denied on January 3,
1946. On January 8, 1946, Fredesvindo S. Alvero
filed his notice of appeal and record on appeal
simultaneously in the lower court, without filing
the P60-appeal bond.
Jose R. Victoriano filed a petition to dismiss the
appeal, Fredesvindo S. Alvero filed an opposition
to said motion to dismiss, alleging that on the
very same day, January 15, 1946, said appeal
bond for P60 had been actually filed, and allege
as an excuse, for not filing the said appeal bond,
in due time, the illness of his lawyer's wife. The
respondent judge, Hon. Mariano L. de la Rosa,
ordered the dismissal of the appeal, declaring
that, although the notice of appeal and record on
appeal had been filed in due time, the P60-appeal
bond was filed too late.
ISSUE:
Is the petition defective in form as well as in
substance?
HELD:
Yes, the period for perfecting herein petitioner's
appeal commenced from November 28, 1945,
when he was notified of the judgment rendered
in the case, and expired on December 28, 1945;
and, therefore, his notice of appeal and record on
appeal filed on January 8, 1946, were filed out of
time, and much more so his appeal bond, which
was only filed on January 15, 1946.
Counsel for the petitioner Fredesvindo Alvero
alleges as an excuse, for his failure to perfect and
file his appeal, in due time, the illness of his wife.
It is not difficult to understand the state of mind
of the attorney, and his intense devotion and
ardent affection towards his dying wife.
Unfortunately, counsel for petitioner has created
a difficult situation. In his motion for
reconsideration and new trial, dated December
27, 1945, he did not point out specifically the
findings or conclusions in the judgment, are not
supported by the evidence or which are contrary
to law, making express reference to the pertinent
evidence or legal provisions, as expressly
required by Rule 37, section 2, paragraph (c) of
the Rules of Court. Motions of that kind have
been considered as motions pro forma intended
merely to delay the proceeding, and, as such,
they cannot and will not interrupt or suspend the
period of time for the perfection of the appeal.
He could have asked for an extension of time,
within which to file and perfect his appeal, in the
court below; but he had failed to do so, and he
must bear the consequences of his act.
A strict observance of the rules of court, which
have been considered indispensable to the
prevention of needless delays and to the orderly
and speedy dispatch of judicial business, is an
imperative necessity. Human laws are inflexible
and no personal consideration should stand in
the way of performing a legal duty.
PRISCILLA ALMA JOSE vs. RAMON C. JAVELLANA,
ET AL.
FACTS:
Margarita Marquez Alma Jose (Margarita) sold
for consideration of P160,000.00 to respondent
Ramon Javellana by deed of conditional sale two
parcels of land with areas of 3,675 and 20,936
square meters located in Barangay Mallis,
Guiguinto, Bulacan. They agreed that Javellana
would pay P80,000.00 upon the execution of the
deed and the balance of P80,000.00 upon the
registration of the parcels of land under the
Torrens System (the registration being
undertaken by Margarita within a reasonable
period of time); and that should Margarita
become incapacitated, her son and attorney-in-
fact, Juvenal M. Alma Jose (Juvenal), and her
daughter, petitioner Priscilla M. Alma Jose, would
receive the payment of the balance and proceed
with the application for registration.
After Margarita died and with Juvenal having
predeceased Margarita without issue, the
vendors undertaking fell on the shoulders of
Priscilla, being Margaritas sole surviving heir.
However, Priscilla did not comply with the
undertaking to cause the registration of the
properties under the Torrens System, and,
instead, began to improve the properties by
dumping filling materials therein with the
intention of converting the parcels of land into a
residential or industrial subdivision. Faced with
Priscillas refusal to comply, Javellana
commenced an action for specific performance,
injunction, and damages against her in the
Regional Trial Court in Malolos, Bulacan (RTC).
Javellana prayed for the issuance of a temporary
restraining order or writ of preliminary injunction
to restrain Priscilla from dumping filling materials
in the parcels of land; and that Priscilla be
ordered to institute registration proceedings and
then to execute a final deed of sale in his favor.
Priscilla filed a motion to dismiss, stating that the
complaint was already barred by prescription;
and that the complaint did not state a cause of
action.
The RTC initially denied Priscillas motion to
dismiss. However, upon her motion for
reconsideration, the RTC reversed itself and
granted the motion to dismiss.
Javellana moved for reconsideration. The RTC
denied the motion for reconsideration for lack of
any reason to disturb its order. Accordingly,
Javellana filed a notice of appeal. Priscilla
countered that the RTC order was not
appealable; that the appeal was not perfected on
time; and that Javellana was guilty of forum
shopping. It appears that pending the appeal,
Javellana also filed a petition for certiorari in the
CA to assail the June 24, 1999 and June 21, 2000
orders dismissing his complaint. The CA
dismissed the petition for certiorari.
As to the notice on appeal, the CA reversed and
set aside the RTC decision and remanded the
records to the RTC "for further proceedings in
accordance with law." The CA denied the motion
for reconsideration filed by Priscilla.
ISSUE:
1. Whether or not the RTCs decision
denying of the motion for
reconsideration of the order of dismissal
a final order and appealable;
2.
3. Javellana was guilty of forum shopping
for filing in the CA a petition for certiorari
to assail the orders of the RTC that were
the subject matter of his appeal pending
in the CA.
HELD:
1. Yes.
First of all, the denial of Javellanas motion for
reconsideration left nothing more to be done by
the RTC because it confirmed the dismissal of
Civil Case No. 79-M-97. It was clearly a final order,
not an interlocutory one. The distinction
between a final order and an interlocutory order
is well known. The first disposes of the subject
matter in its entirety or terminates a particular
proceeding or action, leaving nothing more to be
done except to enforce by execution what the
court has determined, but the latter does not
completely dispose of the case but leaves
something else to be decided upon. An
interlocutory order deals with preliminary
matters and the trial on the merits is yet to be
held and the judgment rendered. The test to
ascertain whether or not an order or a judgment
is interlocutory or final is: does the order or
judgment leave something to be done in the trial
court with respect to the merits of the case? If it
does, the order or judgment is interlocutory;
otherwise, it is final.
And, secondly, whether an order is final or
interlocutory determines whether appeal is the
correct remedy or not. A final order is appealable,
to accord with the final judgment rule enunciated
in Section 1, Rule 41 of the Rules of Court to the
effect that "appeal may be taken from a
judgment or final order that completely disposes
of the case, or of a particular matter therein
when declared by these Rules to be appealable;"
but the remedy from an interlocutory one is not
an appeal but a special civil action for certiorari.
2. No.
No forum shopping was committed.
Priscilla claims that Javellana engaged in forum
shopping by filing a notice of appeal and a
petition for certiorari against the same orders. As
earlier noted, he denies that his doing so violated
the policy against forum shopping.
The Court expounded on the nature and purpose
of forum shopping in In Re: Reconstitution of
Transfer Certificates of Title Nos. 303168 and
303169 and Issuance of Owners Duplicate
Certificates of Title In Lieu of Those Lost, Rolando
Edward G. Lim, Petitioner:
Forum shopping is the act of a party litigant
against whom an adverse judgment has been
rendered in one forum seeking and possibly
getting a favorable opinion in another forum,
other than by appeal or the special civil action of
certiorari, or the institution of two or more
actions or proceedings grounded on the same
cause or supposition that one or the other court
would make a favorable disposition. Forum
shopping happens when, in the two or more
pending cases, there is identity of parties, identity
of rights or causes of action, and identity of reliefs
sought. Where the elements of litis pendentia are
present, and where a final judgment in one case
will amount to res judicata in the other, there is
forum shopping. For litis pendentia to be a
ground for the dismissal of an action, there must
be: (a) identity of the parties or at least such as to
represent the same interest in both actions; (b)
identity of rights asserted and relief prayed for,
the relief being founded on the same acts; and (c)
the identity in the two cases should be such that
the judgment which may be rendered in one
would, regardless of which party is successful,
amount to res judicata in the other.
For forum shopping to exist, both actions must
involve the same transaction, same essential
facts and circumstances and must raise identical
causes of action, subject matter and issues.
Clearly, it does not exist where different orders
were questioned, two distinct causes of action
and issues were raised, and two objectives were
sought.
Should Javellanas present appeal now be held
barred by his filing of the petition for certiorari in
the CA when his appeal in that court was yet
pending?
We are aware that in Young v. Sy, in which the
petitioner filed a notice of appeal to elevate the
orders concerning the dismissal of her case due
to non-suit to the CA and a petition for certiorari
in the CA assailing the same orders four months
later, the Court ruled that the successive filings of
the notice of appeal and the petition for certiorari
to attain the same objective of nullifying the trial
courts dismissal orders constituted forum
shopping that warranted the dismissal of both
cases. The Court said:
Ineluctably, the petitioner, by filing an ordinary
appeal and a petition for certiorari with the
CA, engaged in forum shopping. When the
petitioner commenced the appeal, only four
months had elapsed prior to her filing with the CA
the Petition for Certiorari under Rule 65 and
which eventually came up to this Court by way of
the instant Petition (re: Non-Suit).
The elements of litis pendentia are present
between the two suits. As the CA, through its
Thirteenth Division, correctly noted, both suits
are founded on exactly the same facts and refer
to the same subject matterthe RTC Orders
which dismissed Civil Case No. SP-5703 (2000)
for failure to prosecute. In both cases, the
petitioner is seeking the reversal of the RTC
orders. The parties, the rights asserted, the
issues professed, and the reliefs prayed for, are
all the same. It is evident that the judgment of
one forum may amount to res judicata in the
other.
The remedies of appeal and certiorari under Rule
65 are mutually exclusive and not alternative or
cumulative. This is a firm judicial policy. The
petitioner cannot hedge her case by wagering
two or more appeals, and, in the event that the
ordinary appeal lags significantly behind the
others, she cannot post facto validate this
circumstance as a demonstration that the
ordinary appeal had not been speedy or
adequate enough, in order to justify the recourse
to Rule 65. This practice, if adopted, would
sanction the filing of multiple suits in multiple
fora, where each one, as the petitioner couches
it, becomes a precautionary measure for the
rest, thereby increasing the chances of a
favorable decision. This is the very evil that the
proscription on forum shopping seeks to put
right.
In Guaranteed Hotels, Inc. v. Baltao, the Court
stated that the grave evil sought to be avoided by
the rule against forum shopping is the rendition
by two competent tribunals of two separate and
contradictory decisions. Unscrupulous party
litigants, taking advantage of a variety of
competent tribunals, may repeatedly try their
luck in several different fora until a favorable
result is reached. To avoid the resultant
confusion, the Court adheres strictly to the rules
against forum shopping, and any violation of
these rules results in the dismissal of the case.
CIR vs MIRANT PAGBILAO CORP
FACTS:
[MPC] is a domestic corporation duly organized
and existing under and by virtue of the laws of the
Philippines.
For the period April 1, 1996 to December 31,
1996, [MPC] seasonably filed its Quarterly VAT
Returns reflecting an accumulated input taxes in
the amount of P39,330,500.85. These input
taxes were allegedly paid by [MPC] to the
suppliers of capital goods and services for the
construction and development of the power
generating plant and other related facilities in
Pagbilao, Quezon.
Pursuant to the procedures prescribed under
Revenue Regulations No. 7-95, as amended,
[MPC] filed on June 30, 1998, an application for
tax credit or refund of the aforementioned
unutilized VAT paid on capital goods.
In answer to the Petition, [the BIR Commissioner]
advanced as special and affirmative defenses that
"[MPC]'s claim for refund is still pending
investigation and consideration before the office
of [the BIR Commissioner] accordingly, the filing
of the present petition is premature; well-settled
is the doctrine that provisions in tax refund and
credit are construed strictly against the taxpayer
as they are in the nature of a tax exemption; in an
action for refund or tax credit, the taxpayer has
the burden to show that the taxes paid were
erroneously or illegally paid and failure to sustain
the said burden is fatal to the action for refund; it
is incumbent upon [MPC] to show that the claim
for tax credit has been filed within the
prescriptive period under the Tax Code; and the
taxes allegedly paid by [MPC] are presumed to
have been collected and received in accordance
with law and revenue regulations.
The CTA ruled in favor of MPC and the refund was
granted.
Aggrieved, the BIR Commissioner filed with the
CA a Petition for Review of the foregoing
Decision. Notably, the BIR Commissioner
identified and discussed as grounds for its
Petition arguments that were totally new and
were never raised before the CTA, to wit -
1. RESPONDENT BEING AN ELECTRIC
UTILITY, IT IS SUBJECT TO FRANCHISE TAX
UNDER THEN SECTION 117 (NOW
SECTION 119) OF THE TAX CODE AND
NOT TO VALUE ADDED TAX (VAT).
2. SINCE RESPONDENT IS EXEMPT FROM
VAT, IT IS NOT ENTITLED TO THE REFUND
OF INPUT VAT PURSUANT TO SECTION
4.103-1 OF REVENUE REGULATIONS NO.
7-95.
The Court of Appeals found no merit in the BIR
Commissioner's Petition, and in its Decision,
dated 30 July 2003, it pronounced that:
(1) The BIR Commissioner cannot validly change
his theory of the case on appeal;
CA affirmed in toto.

Hence, this petition. The BIR Commissioner
argues that (1) The observance of procedural
rules may be relaxed considering that
technicalities are not ends in themselves but exist
to protect and promote the substantive rights of
the parties;
ISSUE:
WON the contention of the BIR commissioner is
correct.
RULING:
No.
The general rule is that a party
cannot change his theory of
the case on appeal.
It is already well-settled in this jurisdiction that a
party may not change his theory of the case on
appeal. Such a rule has been expressly adopted in
Rule 44, Section 15 of the 1997 Rules of Civil
Procedure, which provides - they are designed to facilitate the adjudication of
SEC. 15. Questions that may be raised on
appeal. - Whether or not the appellant has filed a
motion for new trial in the court below, he may
include in his assignment of errors any question
of law or fact that has been raised in the court
below and which is within the issues framed by
the parties.
Thus, in Carantes v. Court of Appeals, this Court
emphasized that
The settled rule is that defenses not pleaded in
the answer may not be raised for the first time on
appeal. A party cannot, on appeal, change
fundamentally the nature of the issue in the
case. When a party deliberately adopts a certain
theory and the case is decided upon that theory
in the court below, he will not be permitted to
change the same on appeal, because to permit
him to do so would be unfair to the adverse party.
In the more recent case of Mon v. Court of
Appeals, this Court again pronounced that, in this
jurisdiction, the settled rule is that a party cannot
change his theory of the case or his cause of
action on appeal. It affirms that "courts of justice
have no jurisdiction or power to decide a
question not in issue." Thus, a judgment that
goes beyond the issues and purports to
adjudicate something on which the court did not
hear the parties, is not only irregular but also
extrajudicial and invalid. The rule rests on the
fundamental tenets of fair play.
The BIR Commissioner pleads with this Court not
to apply the foregoing rule to the instant case, for
a rule on technicality should not defeat
substantive justice. The BIR Commissioner
apparently forgets that there are specific reasons
why technical or procedural rules are imposed
upon the courts, and that compliance with these
rules, should still be the general course of
action. Hence, this Court has expounded that -
Procedural rules, we must stress, should be
treated with utmost respect and due regard since
cases to remedy the worsening problem of delay
in the resolution of rival claims and in the
administration of justice. The requirement is in
pursuance to the bill of rights inscribed in the
Constitution which guarantees that "all persons
shall have a right to the speedy disposition of
their cases before all judicial, quasi-judicial
and administrative bodies." The adjudicatory
bodies and the parties to a case are thus enjoined
to abide strictly by the rules. While it is true that
a litigation is not a game of technicalities, it is
equally true that every case must be prosecuted
in accordance with the prescribed procedure to
ensure an orderly and speedy administration of
justice. There have been some instances wherein
this Court allowed a relaxation in the application
of the rules, but this flexibility was "never
intended to forge a bastion for erring litigants to
violate the rules with impunity." A liberal
interpretation and application of the rules of
procedure can be resorted to only in proper cases
and under justifiable causes and circumstances.
The courts have the power to relax or suspend
technical or procedural rules or to except a case
from their operation when compelling reasons so
warrant or when the purpose of justice requires
it. What constitutes good and sufficient cause
that would merit suspension of the rules is
discretionary upon the courts.

In his Petition and Memorandum before this

Court, the BIR Commissioner made no attempt to
provide reasonable explanation for his failure to
raise before the CTA the issue of MPC being a
public utility subject to franchise tax rather than
VAT. The BIR Commissioner argues, in a singular
paragraph in his Petition, subsequently
reproduced in his Memorandum, that the Court
of Appeals should have taken cognizance of the
said issue, although it was raised for the first time
on appeal, entirely on the basis of this Court's
ruling in Sy v. Court of Appeals. He contends that
-

The submission fails to take into account that

although this Honorable Court has repeatedly
ruled that litigants cannot raise an issue for the
first time on appeal, as this would contravene the
basic rules of justice and fair play, the observance
of procedural rules may be relaxed, noting that
technicalities are not ends in themselves but exist
to protect and promote the substantive rights of
the litigants (Sy v. Court of Appeals, 330 SCRA 570
[2000]).
This Court is unconvinced. There is no sufficient
cause to warrant the relaxation of technical or
procedural rules in the instant case. The general
rules of procedure still apply and the BIR
Commissioner cannot be allowed to raise an issue
for the first time on appeal.