GLORIA G. HALLASGO, G.R. No. interest over personal interest at all times.

It is in
171340* this spirit that we convey our deep disdain for all
Municipal Treasurer of those whose actions betray the trust and confidence
Damulog, reposed in public officers, and those who attempt to
Bukidnon, Present: conceal wrongdoing through misdirection and
Petitioner, blatantly belated explanations.
PUNO, C. J.,
QUISUMBING,** This is a Petition for Review on Certiorari filed by
- versus - YNARES- petitioner Gloria Hallasgo, Municipal Treasurer of
SANTIAGO, Damulog, Bukidnon, assailing the Decision[2] dated 9
CARPIO, September 2004 of the Court of Appeals (CA) in CA-
CORONA, GR SP No. 77522, affirming the 22 October 2002
COMMISSION ON AUDIT CARPIO Decision[3] of the Deputy Ombudsman for
MORALES, Mindanao. Said Decision of the Ombudsman found
(COA) Regional Office No. X, CHICO- petitioner guilty of grave misconduct and ordered
NAZARIO, her dismissal from the service. Also assailed in this
ELIEZER ASOMBRADO, the VELASCO, JR., petition is the Resolution[4] dated 19 January 2006
former vice-mayor of the NACHURA, of the CA denying petitioners Motion for
Municipality of Damulog, LEONARDO-DE Reconsideration.
CASTRO,
Bukidnon, ALEJANDRO S. BRION, Petitioner was the Municipal Treasurer of the
BERDERA, a former member of PERALTA, Municipality of Damulog, Bukidnon. On 15 June
Sangguniang Bayan BERSAMIN, 2001, she was accused before the Office of the
and ULYSES Deputy Ombudsman for Mindanao of unauthorized
TIRADO and ARMANDO AYCO, DEL CASTILLO, withdrawal of monies of the public treasury
and amounting to malversation of public funds by
members of the Sangguniang ABAD, JJ. outgoing and incumbent officials of the
Bayan municipality, namely, Messrs. Eliezer N. Asombrado,
of the Municipality of Alejandro S. Berdera, Ulyses T. Tirado, and Armando
Damulog, L. Ayco.[5] Also named in the Affidavit-Complaint
Bukidnon,*** Promulgated: were Emma T. Badic and Emiterio D. Luis, the
Respondents. September 11, municipalitys disbursing officer and municipal
2009 mayor from 1980 to 1998, respectively. The case
x--------------------------------------- was docketed as Eliezer N. Asombrado, et al. v.
--------------------x Gloria Hallasgo, Emma Badic, and Emiterio Luis, for
malversation (OMB-MIN-01-0329) and gross
DECISION misconduct (OMB-MIN-ADM-01-192).

DEL CASTILLO, J.: In brief, the Affidavit-Complaint claimed that

petitioner, Badic and Luis were liable for the
The oft-repeated phrase, public office is a public following acts: (1) making unrecorded withdrawals
trust[1] is not and should not be mere hortatory from the municipalitys bank account
clich. A public servant is expected to exhibit, at all totaling P360,000.00 without the required
times, the highest degree of honesty and integrity, supporting documents; and (2) failing to liquidate
and is accountable to all those he or she cash advances despite the lapse of over a year, in
serves. Public officers particularly those in custody the amount of P171,256.00.
of public funds are held to the highest standards of On 9 August 2001, petitioner, Badic and Luis filed
ethical behavior in both their public and private their Joint Counter-Affidavit[6] alleging that: (1) all
conduct, and are expected to uphold the public disbursements were supported by vouchers and
recorded in the Treasurers Cash Book and Journal of
Checks; and (2) all the required documentation to
liquidate the cash advances were received by the
Municipal Accountant on 26 December 2000. In
addition, Luis declared that he had since retired
from the service, and that all his accounts were
cleared prior to his retirement.
After a preliminary review of the documents, the
Office of the Ombudsman for Mindanao determined
that it could not make a complete evaluation of the
issues without conducting an extensive audit. Thus,
it requested the Commission on Audit (COA), Region
X, Cagayan de Oro City, to audit the records of the
alleged anomalous transactions. On 16 October
2001, in accordance with COA Regional Office Order
No. 2001-X-297L, the COA created a Special Audit
Team (the audit team) to verify the transactions
referred to in the Affidavit-Complaint. The audit
team submitted its report to the COA Regional
Office on 12 December 2001; said results were then
referred to the Office of the Ombudsman for
Mindanao on 11 February 2002.
The salient points of the audit teams findings[7] are
summarized as follows:
A. Alleged Unrecorded Withdrawals of P360,000.00
through three (3) checks made without supporting
vouchers.
1. Land Bank of the Philippines (LBP) Check No.
15106143 for P100,000.00 dated 2 August 1996 in
favor of Emma T. Badic, Disbursing Officer.
The audit team found that this transaction was
officially recorded.
2. LBP Check No. 15627928 for P250,000.00 dated
15 August 1997 in favor of petitioner.
LBP Check No. 15627928 amounting to P250,000.00
was withdrawn and encashed by the petitioner on
15 August 1997 without the required disbursement
voucher. No evidence existed to show that the
amount withdrawn was deposited in any of the
municipalitys depositary banks.
Petitioner first claimed that she deposited this
amount in the municipalitys Philippine National
Bank (PNB) account. However, no evidence of a cash
deposit in the amount of P250,000.00 could be
found. Instead, it appeared that what was actually
deposited by the petitioner were checks that were
intended to fund separate transactions.
Petitioner later claimed that, after going over her
records, the P250,000.00 was kept in her safe as
reserve fund, so this amount was included in her
accountabilities. The audit team however noted that
no evidence was presented to show that
the P250,000.00 was really accounted for, aside
from petitioners statement that this was included in
the funds under her accountability. Further, a
verification of the general ledger account as of 31
December 1997 revealed that the cash in treasury
amounted to only P239,741.65.
The audit team recommended that petitioner be
made to account for the withdrawal; otherwise, the
appropriate action should be instituted against her
for failure to account for the amount withdrawn.
3. LBP Check No. 26719253 for P10,000.00 dated 27
February 1998 issued to Emiterio D. Luis.
There was no disbursement voucher found on file
from the Office of the Provincial Auditor of
Bukidnon, nor was there any record of this
transaction taken up either in the Treasurers Journal
of Checks, the General Ledger Book, or the
Treasurers Cashbook. Petitioner explained that the
check was actually issued as the municipalitys
contribution to the Department of Education
Culture and Sports (DECS) regional competition, but
a mistake was made in effecting payment. However,
the audit team found that this check was deposited
on 17 July 1998 in the LBP-Maramag branch,
returned, and then re-deposited in the trust fund
account of the municipality. Evidently, it took four
months and 16 days for the former Mayor, Luis, to
return the check. The audit team also noted that if
the check was really intended as contribution to the
DECS, then the DECS, not the mayor, would have
been the designated signatory.
The audit team recommended that petitioner and
Luis should be made to account for the withdrawal
of the fund without the appropriate documentation;
otherwise, the appropriate action should be
instituted against them for failure to account for the
amount withdrawn. In addition, they recommended
that the municipality should stop the practice of
disbursing money of the local treasury without
complete documentation.
B. Alleged Unliquidated Cash Advances
of P171,256.00.
1. The COA audit revealed that of the P171,256.00
cash advances listed, the amount of P30,161.90 had
already been previously liquidated.
2. As for the remaining P141,094.10, these
constituted cash advances granted to petitioner
which remained unliquidated for over one
year. Indeed, a review of the dates showed that the
cash advances remained unliquidated for a period
ranging from one year and six months to two years
and five months.
The audit team recommended that all officials be
required to process the liquidation of vouchers of
cash advances submitted by the former Municipal
Treasurer in accordance with Section 5 of COA
Circular No. 97-02 so that unliquidated cash
advances could be settled. Otherwise, appropriate
administrative actions should be instituted against
those who fail to settle their cash advances
accordingly.
3. Additional cash advances had been granted to
petitioner, even if previous cash advances remained
unsettled, thus exposing the funds to possible
misuse and misappropriation. Consequently, the
audit team recommended that the municipality
should stop the practice of granting additional cash
advances to officials who have not yet liquidated
their previous cash advances.
4. Cash advances totaling P171,256.00 were granted
to the former Municipal Treasurer under her own
accountability, in violation of COA-MOF Joint
Memorandum Circular No. 02-81 dated 15
November 1981. As such, the audit team
recommended that the municipality stop the
practice of granting cash advances to the Municipal
Treasurer under her own accountability except upon
prior approval from the Department of Finance.
C. Alleged Unrecorded Withdrawals of P700,000.00
encashed by petitioner on 16 June 1997 under PNB
Check No. 586577-W for P350,000.00 and LBP
Check No. 15627907 for P350,000.00.
The audit team found that these transactions
totaling the amount of P700,000.00 were all
recorded in the books of accounts as of June 1997.
Nonetheless, in the course of the audit, the audit
team noted that on two separate occasions, the
Disbursing Officer failed to timely record the cash
advances in her cashbook at the time the
transactions were incurred, in violation of Section
19(a) of COA Memorandum 84-373, thus precluding
early detection of errors and discrepancies. The
delays in recording ranged from 26 30 days. The
audit team recommended that the municipality
direct the Disbursing Officer to record promptly all
cash advances received in the cashbook at the time
the transaction is incurred, to avoid mishandling of
cash and to detect errors and discrepancies without
delay.
D. Petitioner failed to remit intact and promptly
the amounts she received in cash
totaling P980,000.00, thus exposing government
funds to probable misuse/misapplication.
It was shown that on separate occasions in 1997,
petitioner withdrew a total of P980,000.00 from the
Municipal Treasury, allegedly for fund transfer to
the PNB, as follows:
Date of Check Payee Check No. A
15 August 1997 G. Hallasgo LBP15627928[8] PhP
16 June 1997 G. Hallasgo LBP15627907 PhP
29 July 1997 G. Hallasgo LBP15627921 PhP
Petitioner explained that she had the checks issued
in her name, instead of depositing them in the
municipalitys account, in order to avoid the three or
four day clearing period. However, in the course of
the audit, it was shown that even the cash was
never deposited to the municipalitys PNB account.
Rather, petitioner deposited different checks to
fund the PNB account; stated otherwise, checks
were used to cover up cash withdrawals for the
same purpose. It was thus unclear what the funds
under LBP Check Nos. 15627907 and 15627921
were utilized for.
The audit team recommended that (1) petitioner be
required to explain the final status of cash
withdrawn totaling P980,000.00; (2) the
municipality end the practice of encashing checks
for the purpose of withdrawal by the depositary for
fund transfer to another bank; (3) responsible
officers deposit intact and promptly the full amount
so received and collected to the treasury and credit
it to particular accounts to which said money
belongs to avoid misuse/misapplication of the same.
On 12 April 2002, the audit team, composed of
State Auditors Concepcion Guanzon and Leonido
Pajo, executed a Joint Affidavit summarizing their
findings against petitioner and Luis.[9] The case was
re-docketed as Commission on Audit (COA) Regional
Office No. X v. Gloria Hallasgo & Emiterio D. Luis,
but the same docket numbers were
retained. Petitioner filed her Counter-Affidavit
dated 17 June 2002, essentially reiterating the
defenses made before the COA Audit Team.[10] After
the parties filed their respective position papers, the
case was submitted for resolution.[11]
On 22 October 2002, the Deputy Ombudsman for
Mindanao issued a Decision[12] finding petitioner
guilty of GRAVE MISCONDUCT. The charge against
Luis was dismissed.Pertinent portions thereof read
as follows:
This Office finds that there is sufficient evidence to
support a finding of grave misconduct against
respondent [Hallasgo]. Misconduct in office implies
a wrongful intention and not a mere error of
judgment. In the instant case, the respondent
appears to have used her expertise in financial
management to obfuscate the subject transactions
for the purposes of concealing financial
anomalies. Her acts cannot be considered as done in
good faith or constituting only errors of judgment. It
is to be emphasized that the tasks and functions of a
treasurer is highly fiduciary in nature. Public office is
a public trust. In the case of the respondent, a
higher degree of standard is expected from her and
this Office finds that she has abjectly failed to live
up to that standard. In grave misconduct, as
distinguished from simple misconduct, the elements
of corruption, clear intent to violate the law, or
flagrant disregard of established rule must be
manifest. All of these are evident in the instant case.
xxxx
WHEREFORE, PREMISES CONSIDERED, this Office
finds respondent GLORIA HALLASGO, GUILTY OF
GRAVE MISCONDUCT. Pursuant to Resolution No.
991936, otherwise known as the Uniform Rules on
Administrative Cases in the Civil Service, the
respondent is hereby meted the corresponding
penalty of DISMISSAL FROM THE SERVICE, together
with all the accessory penalties appurtenant
thereto, effective upon the finality hereof. The
charge against co-respondent Emeterio D. Luis is
hereby DISMISSED.[13]
Petitioner filed a Motion for
Reconsideration,[14] which was denied by the Office
of the Ombudsman in an Order[15] dated 8 April
2003. Petitioner then appealed the Decision to the
CA under Rule 43 of the Rules of Court.
In the herein assailed Decision[16] dated 9
September 2004, the CA dismissed petitioners
appeal for lack of merit. Petitioners Motion for
Reconsideration[17] dated 27 September 2004 was
likewise dismissed in a Resolution[18] dated 19
January 2006.
Before this Court, petitioner now claims that:
1. The CA did not decide the case in accordance with
applicable law and jurisprudence.
2. The CA failed to appreciate the conclusions of the
COA as found in the audit report, and thus departed
from the accepted and usual course of judicial
proceedings, that justifies the exercise of
supervision by the Supreme Court.
3. The CA failed to appreciate that there was no
substantial evidence to warrant the meting out of
the extreme penalty of dismissal from service.
4. The penalty of DISMISSAL from the service
imposed by the Ombudsman and affirmed by the CA
is not commensurate to their findings since no
substantial evidence exists.
In its Comment[19] dated 28 June 2006, the Office of
the Solicitor General (OSG), representing the COA,
argued that:
1. All indispensable parties should have been
impleaded in the proceedings before the
Ombudsman and made parties to the Petition filed
before the CA.
2. A Petition for Review under Rule 45 of the 1997
Rules of Civil Procedure must raise only questions of
law.
3. The totality of the evidence must be considered
in determining petitioners liability for grave
misconduct, as what was correctly done by the
Ombudsman.
4. Petitioners dismissal from service is warranted by
law and the evidence on record.
We affirm the ruling of the CA and DENY the
petition for lack of merit.
Procedural Matters
There is no merit in the OSGs claim that private
complainants - Eliezer Asombrado, Alejandro
Berdera, Ulyses Tirado, and Armando Ayco - were
denied due process when petitioner failed to
implead them as indispensable parties before the
CA.[20]
A review of the records indicates that even during
the proceedings before the Office of the
Ombudsman, the case was re-docketed
as Commission on Audit Regional Office No. X v.
Gloria Hallasgo and Emiterio D. Luis, after the COA
audit team executed a Complaint-Affidavit against
petitioner for gross misconduct. Furthermore, the
private complainants cannot be considered
indispensable parties,[21] such that the case cannot
be resolved without their participation. In
administrative cases, the complainant is a mere
witness; no private interests are involved as any
offense is committed against the government.[22] In
any event, the private complainants were not
denied due process. Although not named in the
petition, the private complainants were furnished
copies of the pleadings and did, in fact, participate
in the proceedings before the CA, arguing vigorously
against the petitioner.[23]
On the other hand, the OSG correctly argues that
questions of fact are not proper in a petition
brought under Rule 45 of the Rules of Court.[24] Put
simply, the Supreme Court is not a trier of
facts,[25] and cannot be tasked to analyze, assess,
and weigh the facts presented by the parties before
the Ombudsman and the CA in order to ascertain if
their appreciation of the evidence is
[26]
correct. Although there are recognized
exceptions to this rule,[27] none of them apply to the
present case. Nonetheless, in the interest of justice,
we have carefully examined all the evidence in this
case, but still find that there is no sufficient reason
to overturn the findings of the CA and the Office of
the Ombudsman.
Our Finding of Gross Misconduct
Misconduct generally means wrongful, improper or
unlawful conduct motivated by a premeditated,
obstinate or intentional purpose. It is a
transgression of some established and definite rule
of action, a forbidden act, a dereliction of
duty. Qualified by the term gross, it means conduct
that is "out of all measure beyond allowance;
flagrant; shameful; such conduct as is not to be
excused."[28]
We find that the evidence on record demonstrates a
pattern of negligence and gross misconduct on the
part of the petitioner that fully satisfies the standard
of substantial evidence. Substantial evidence is such
amount of relevant evidence that a reasonable mind
might accept as adequate to support a
conclusion.[29]
Petitioners failure to keep current and accurate
records, repeated withdrawal of funds without the
appropriate disbursement vouchers, failure to
ensure the timely liquidation of her cash advances
even after the lapse of over a year, and failure to
account for funds in her custody not only constitute
violations of applicable laws,[30] but also reflect
poorly on the government and provide ripe
opportunity for fraud and corruption.
Petitioner presented these arguments to exonerate
herself from liability: first, any anomalous
transactions are merely the product of human error,
and do not constitute misconduct so grave as to
warrant dismissal from the service; second, as
regards the failure to liquidate cash advances, it is
the accountant that failed to obligate all cash
advances; thus, petitioner should not be held
liable; third, unless a thorough audit is done, she
should not have been adjudged to have committed
gross misconduct. In particular, she claims that since
the audit team could not determine the final status
of the cash withdrawn for the purpose of fund
transfer to PNB, her dismissal is not warranted until
a full-blown audit is conducted.
We are not persuaded.
As treasurer of the municipality, it is petitioners
duty to perform her responsibilities diligently,
faithfully, and efficiently. It behooves her to exercise
the highest degree of care over the custody,
management, and disbursement of municipal
funds.[31] Even if petitioner may have justified some
of the transactions, these explanations were
belatedly done, effected only after being directed to
do so by the audit team. This purported atonement,
undertaken as an afterthought accompanied by
neither shame nor remorse, cannot exonerate her
from liability.[32]
We are not convinced that the anomalies
complained of are the result of mere inadvertence,
or that responsibility can so easily be shifted by
petitioner to her subordinates. On the contrary, her
actions demonstrate her wanton and deliberate
disregard for the demands of public service.
Petitioners failure to ensure that disbursements are
properly documented or that cash advances granted
to her are properly and timely liquidated certainly
deserves administrative sanction. In particular, we
wish to denounce petitioners practice of having the
municipality issue checks in her name, ostensibly to
get cash immediately and avoid a three day clearing
period, only to discover that petitioner never
actually deposited the cash in the municipalitys
bank account. This is a highly pernicious practice
that this Court condemns in the strongest possible
terms.
It bears stressing that petitioner never bothered to
explain what took place with respect to the funds
subject of LBP Check Nos. 15627907
(for P350,000.00) and 15627921
(for P380,000.00). In stark contrast with the staunch
defense she launched for other matters, she never
thought to account for these checks, whether
before the Office of the Ombudsman, the CA, or this
Court. She cannot abdicate responsibility for the
checks by claiming that it was the audit teams duty
to undertake forensic analysis to uncover how these
funds were spent. Rather, as treasurer, she should
have deposited the funds as she was tasked to do,
and subsequently accounted for the use of said
funds.
All these collectively constitute gross
misconduct. Pursuant to Section 52, Rule IV of the
Civil Service Rules, gross misconduct is a grave
offense punishable with dismissal for the first
offense,[33] without prejudice to the Ombudsmans
right to file the appropriate criminal case against the
petitioner or other responsible individuals. We are,
of course, aware that in several administrative
cases, this Court has refrained from strictly imposing
the penalties provided by the law, in light of
mitigating factors such as the offending employees
length of service, acknowledgment of his or her
infractions and feeling of remorse, family
circumstances, advanced age, and other equitable
considerations.[34]However, we find that petitioners
recalcitrant refusal to explain the use (or misuse) of
the more than P700,000.00 in cash placed in her
possession makes her unworthy of such
humanitarian consideration, and merits the most
serious penalty provided by law.
WHEREFORE, the Petition is hereby DENIED for
LACK OF MERIT. The Court of Appeals Decision in
CA-GR SP No. 77522 dated 9 September 2004 and
Resolution dated 19 January 2006
are AFFIRMED. Petitioner is hereby found GUILTY of
GRAVE MISCONDUCT and is
ordered DISMISSED from service with forfeiture of
all retirement benefits except accrued leave credits,
with prejudice to reemployment in any branch or
instrumentality of the government, including
government-owned and controlled
corporations. The Office of the Ombudsman
is DIRECTED to take appropriate action against
herein petitioner.

SO ORDERED.
G.R. No. 185001 September 25, 2009
RONNIE H. LUMAYNA, ROMEO O. CHULANA,
HELEN A. BONHAON, PETER G. LAHINA, JR.,
JUANITO O. LICHNACHAN, JR., SAMMY C.
CHANG-AGAN, BONIFACIO L. BAICHON,
REYNALDO B. UCHAYAN, JOHN L. MARTIN,
AUGUSTA C. PANITO, ROSENDO P. BONGYO, JR.,
KLARISA MAE C. CHAWANA, Petitioners,
- versus -
COMMISSION ON AUDIT, Respondent.
x---------------------x
DECISION
DEL CASTILLO, J.:
Assailed in this Petition for Certiorari under Rule 64
in relation to Rule 65 of the Rules of Court is the
Decision No. 2005-071[1] dated 29 December 2005
of the Commission on Audit (COA) affirming the
Notice of Disallowance[2] of the 5% salary increase
of the municipal personnel of the Municipality of
Mayoyao, Ifugao covering the period 15 February to
30 September 2002, in the amount of P895,891.50,
and requiring petitioners to refund the same. Also
assailed is the COA Decision No. 2007-
040[3] dated 25 October 2007 denying the Motion
for Reconsideration.
On 15 June 2001, the Department of Budget and
Management (DBM) issued Local Budget Circular
No. 74[4] (LBC No. 74), authorizing the grant of a
maximum of 5% salary adjustment to personnel in
the Local Government Units (LGUs) effective 1 July
2001, pursuant to Republic Act No. 9137[5] dated 8
June 2001.
On 13 May 2002, the Sangguniang Bayan of
Mayoyao, Ifugao, (Sangguniang Bayan) enacted
Resolution No. 41, s. 2002,[6] approving the 2002
Annual Municipal Budget, and appropriating the
amount of P1,590,376.00 thereof for the salaries
and benefits of 17 newly created positions in the
municipality.[7] Upon review by
the Sangguniang Panlalawigan of the Province of
Ifugao (Sangguniang Panlalawigan), the 2002
Annual Municipal Budget of Mayoyao, Ifugao was
declared operative subject to the conditions that
the creation of 17 new positions shall in no case be
made retroactive and that the filling up of such
positions be made strictly in accordance with the
Civil Service rules and regulations.[8]
On 8 July 2002, the Sangguniang Bayan approved
Resolution No. 66, s. 2002, adopting a first class
salary scheme for the municipality and
implementing a 5% salary increase for its personnel
in accordance with LBC No. 74.[9] For this purpose, it
enacted Resolution No. 94, s. 2002, re-aligning the
amount of P1,936,524.96[10] from the 2002
municipal budget originally appropriated for the
salaries and benefits of the 17 new positions.[11]
On 12 July 2002, DBM issued Local Budget Circular
No. 75[12] (LBC No. 75) providing guidelines on
personal services limitation, pursuant to Section
325(a) of the Local Government Code of 1991 (LGC).
On 16 December 2002, the Sangguniang
Bayan through Resolution No. 144, s. 2002,
approved the 2003 Annual Municipal Budget stated
in Appropriation Ordinance No. 03.[13] This was
reviewed by the Sangguniang Panlalawigan and
approved on 10 February 2003 via Resolution No.
2003-808.[14] The Sangguniang Panlalawigan,
however, disallowed the 5% salary increase and the
re-alignment of funds pursuant to Resolution No.
94, s. 2002, of the Sangguniang Bayan on the
ground that the re-alignment is not sufficient in
form to implement a salary increase.
On 9 June 2003, the Sangguniang Bayan enacted
Resolution No. 73, s. 2003,[15] earnestly requesting
the Sangguniang Panlalawigan to reconsider its
Resolution.[16]Finding good faith on the part of the
officials of the municipality, the Sangguniang
Panlalawigan in its Resolution No. 2004-1185
reconsidered its earlier position. Thus,
the Sangguniang Panlalawigan allowed the
adoption of a first class salary schedule and the 5%
salary increase of the Municipality of Mayoyao,
Ifugao.
Meanwhile, the Regional Legal and Adjudication
Office (RLAO) of the COA-Cordillera Administrative
Region (COA-CAR) issued a Notice of Disallowance
dated 16 May 2003 of the amount of P895,891.50,
representing payments for salary increases of
municipal personnel, for the period 15 February - 30
September 2002. According to COA-CAR, the grant
of the increase was not in accordance with Sections
325 and 326 of the LGC; that the limitation on
personal services had been exceeded; and that
the Sangguniang Bayan resolution was not the
appropriate manner of granting the
increase. Pursuant thereto, the following persons,
petitioners herein, were ordered to refund the said
amount:
Helen A. Bonhain Budget Officer
Peter G. Lahina, Jr. Municipal Accountant
Ronnie H. Lumayna Municipal Mayor
denied on 10 November 2003 in Decision No. 2003-
104.
Hence, petitioners filed a Petition for Review before
respondent COA assailing LAO-Local Decision No.
2003-104.
On 29 December 2005, the COA rendered the herein
assailed Decision No. 2005-071[18] denying the
petition for lack of merit, and affirming the
disallowance in the amount of P895,891.50. The
COA held thus:
After a careful evaluation, this Commission answers
in the negative subject to the extended discussions
hereunder.

Anent the first assignment of error, the same has

been judiciously passed upon in LAO-Local Decision
No. 2003-104. While
the Municipality of Mayoyao may grant salary
increases pursuant to LBC No. 74, such grant should
comply with the limitations provided by law,
specifically Section 325 (a) of R.A. No. 7160. There is
no doubt that in the grant of the 5% salary increase
to the officials and employees of
Romeo O. Chulana
the Municipality of Mayoyao, the limitation for PS in
Juanito O. Lichnachan, Jr.
the annual budget of said Municipality had been
Sammy C. Chang-agan
exceeded. In fact, in a recomputation made Ms.
SB
Virginia B. Farro, Provincial Budget Officer of Ifugao,
Members
as embodied in her letter dated July 04, 2003, it was
who
revealed that the Annual Budget of the Municipality
approved
exceeded the PS limit by
Resolutio
P3,944,568.05.Furthermore, Mr. Julian L.
n No. 94,
Pacificador, Jr., Regional Director, DBM-CAR, in his
s. 2002
letter dated December 3, 3003 asserted that the
grant of the increase through the adoption of higher
salary class schedule is not included in the list of
Bonifacio L. Baichon
items and activities whereby PS limitation may be
Reynaldo B. Uchayan
waived under LBC No. 75. It must also be noted that
John L. Martin
the Municipalitys budget adopted the salary rates
Augusta C. Panitio
under LBC No. 69 and not the salary rates under LBC
Rosendo P. Bongyo, Jr.
No. 74.
Klarisa Mae C. Chawana
Anent the second assignment of error, the same will
Petitioners requested a reconsideration, which was
not suffice to over-turn the other grounds for the
denied on 5 August 2003 by the RLAO-COA-
audit disallowance. The fact remains that the grant
CAR.[17] Thus, petitioners filed a Notice of Appeal
of the 5% salary increase contravened the limitation
before the Director, LAO-Local of COA but it was
of the law as explicitly provided under item (a) of
section 325 of R.A. No. 7160.

Anent the third assignment of error, while the
Sanggguniang Panlalawigan of Ifugao, in its
resolution No. 2002-556, has declared operative the
2002 Annual Budget of Mayoyao, the review of said
Sanggunian was only limited to the provisions stated
in the said budget which contained, among others,
provisions for the funding of the 17 newly created
positions and not the salary increases. Thus, the
declaration of the Sangguniang Panlalawigan of
Ifugao that the 2002 annual budget was operative
did not include the grant of the 5% salary increase
because the same was not actually contained in the
said budget but in SB Resolution No. 66, series of
2002.
Anent the 4th assignment of error, the disallowance
is not based solely on the results of the favorable
review of the Sangguniang Panlalawigan of Ifugao
since there are other grounds which would justify
and uphold the disallowance. [19]
Petitioners filed a Motion for Reconsideration but it
was denied by respondent COA on 25 October
2007 in its Decision No. 2007-040.[20]
Hence, this petition[21] under Rule 64 of the Rules of
Court raising the
following issues:
1. RESOLUTION NO. 66, S. 2002 ADOPTING A 5%
INCREASE IN THE SALARY OF THE PERSONNEL OF
LGU MAYOYAO PURSUANT TO DBM LBC 74, AND
RESOLUTION NO. 94, S. 2002 PROVIDING THE FUND
TO IMPLEMENT THE FORMER ARE VALID EXERCISES
OF LOCAL LEGISLATIVE PREROGATIVE BY THE
SANGGUNIANG BAYAN OF MAYOYAO,
IFUGAO. THERE IS SUFFICIENT PROOF THAT THE
BUDGET OF THE MUNICIPALITY OF MAYOYAO FOR
2002 DID NOT EXCEED THE PS LIMITATIONS FOR
THAT PARTICULAR YEAR. IN THE SAME MANNER,
THE REALIGNMENT OF FUNDS PURSUANT TO
RESOLUTION NO. 94, S. 2002 DID NOT CREATE ANY
INCREASE IN THE PERSONAL SERVICES ALLOCATION
OF THE AFORESAID MUNICIPALITY FOR THAT
PARTICULAR YEAR BECAUSE THE REALIGNMENT
PERTAINS TO A REALIGNMENT OF AN EXISTING
PERSONAL SERVICES FUND PARTICULARLY THE
AMOUNT ORIGINALLY INTENDED FOR THE
SEVENTEEN POSITIONS WHICH WERE VACATED
AND/OR ABOLISHED, TO FUND THE SALARY
INCREASE WHICH IN ITSELF IS A PERSONAL SERVICE
EXPENDITURE. THE HONORABLE COMMISSION ON
AUDIT, THEREFORE, GRAVELY ABUSED ITS
DISCRETION WHEN IT HELD THAT THE
REALIGNMENT PURSUANT TO RESOLUTION NO. 94,
S. 2002 CAUSED THE LGU OF MAYOYAO TO EXCEED
THE PS LIMITATIONS FOR 2002 AS PRESCRIBED BY
LAW AND CONSEQUENTLY DECLARING AS INVALID
RESOLUTION NO. 66 S. 2002 OF THE SANGGUNIANG
BAYAN OF MAYOYAO, IFUGAO.
2. THE PERSONAL SERVICES ALLOCATION FOR
THE MUNICIPALITY OF MAYOYAO, IFUGAO FOR FY
2002 WAS COMPUTED IN ACCORDANCE WITH DBM
LBC 74 IN RELATION TO DBM LBC 69 WHICH WERE
THE CIRCULARS IN EFFECT AT THE TIME THE
BUDGET OF THE LGU FOR FY 2002 WAS REVIEWED,
APPROVED AND DECLARED OPERATIVE BY THE
SANGGUNIANG PANLALAWIGAN OF THE PROVINCE
OF IFUGAO THROUGH RESOLUTION NO. 2002-556.
SOON THEREAFTER DBM LBC 75 WAS ISSUED WITH
A CLEAR EFFECTIVITY CLAUSE EXEMPTING FROM ITS
OPERATION BUDGETS WHICH HAVE ALREADY BEEN
REVIEWED PRIOR TO ITS ISSUANCE. NOTICE OF
DISALLOWANCE (ND) NO. 03-006 DATED MAY 16,
2003 IS PREMISED ON A RECOMPUTATION OF THE
ALLOWABLE PS LIMITATION OF THE LGU BASED ON
RATES STATED IN DBM LBC 75 CONTRARY TO THE
CLEAR LANGUAGE OF ITS EFFECTIVITY CLAUSE. THE
HONORABLE COMMISSION, THEREFORE, GRAVELY
ABUSED ITS DISCRETION WHEN IT UPHELD THE
NOTICE OF DISALLOWANCE (ND) NO. 03-007 WHICH
DIRECTED THE HEREIN PETITIONERS TO REFUND
THE AMOUNT DISALLOWED THEREIN.
3. PUBLIC OFFICERS ENJOY THE PRESUMPTION
OF REGULARITY OF PERFORMANCE OF OFFICIAL
FUNCTIONS AND DUTIES. FOR THIS REASON AND
MORE, THE HONORABLE SUPREME COURT UPHELD
CERTAIN NOTICES OF DISALLOWANCE ISSUED BY
THE HONORABLE COMMISSION TO CERTAIN
GOVERNMENT AGENCIES BUT DECLINED TO LET THE
PERSONS LIABLE THEREFORE TO REFUND THE
AMOUNT DISALLOWED ON THE GROUND OF GOOD
FAITH. IN RESOLUTION NO. 2004-1185 OF THE
SANGGUNIANG PANLALAWIGAN OF IFUGAO
RECOGNIZED THE GOOD FAITH OF LGU MAYOYAO
AND THE NOBLE INTENTIONS OF THE OFFICERS
THEREOF TO GIVE THE EMPLOYEES A DECENT
PAY. THE HONORABLE COMMISSION ON AUDIT,
THEREFORE GRAVELY ABUSED ITS DISCRETION,
WHEN IT FAILED TO CONSIDER THE GOOD FAITH OF
THE OFFICERS WHO APPROVED THE QUESTIONED
RESOLUTIONS AND DEMANDED THE REFUND BY
HEREIN PETITIONERS OF THE WHOLE AMOUNT
DISALLOWED THEREIN EVEN IF THE SAID AMOUNTS
WERE ALREADY RECEIVED BY THE EMPLOYEES.[22]
The foregoing boils down to the core issue of
whether the COA committed grave abuse of
discretion in affirming the disallowance of the
amount of P895,891.50, representing the 5% salary
increase of the personnel of the municipality of
Mayoyao for the period 15 February to 30
September 2002, and in ordering petitioners to
refund the same.
We first dispense with the procedural issue of
whether the petition was timely filed.
Respondent, through the Office of the Solicitor
General, argues that the petition should be
dismissed outright for being filed beyond the
reglementary period to appeal.[23]Respondent
maintains that since petitioners received a copy of
Decision No. 2005-071 on 29 August 2006, they only
had 30 days or until 28 September 2006 within
which to file a Motion for Reconsideration or a
Petition for Review on Certiorari with the Supreme
Court. As the Motion for Reconsideration was filed
only on 2 October 2006, the COA Decision No. 2005-
71 already attained finality.[24]
On the other hand, petitioners allege that this
argument on belated filing is misplaced considering
that respondent COA already gave due course to
their Motion for Reconsideration, the resolution of
which was embodied in its Decision No. 2007-
040. At any rate, petitioners argue that their failure
to file the Motion for Reconsideration with
respondent COA on 28 September 2006 was
justified because the government offices in Metro
Manila were closed due to typhoon Feria.[25]
Petitioners contention has merit. Records show that
COA gave due course to the Motion for
Reconsideration without stating in its Decision No.
2007-040[26] that it was filed out of time. For this
reason, we find that the issue of whether the
petitioners timely filed the Motion for
Reconsideration has become moot.
Going now to the merits of the case, petitioners
contend that Resolution Nos. 66 and 94, s. 2002, are
valid exercise of legislative prerogative in
accordance with DBM LBC No. 74, which gave them
the authority to grant a maximum of 5% salary
adjustment to personnel in the LGU effective 1 July
2001. Petitioners cite as basis Resolution No. 2002-
556 of the Sangguniang Panlalawigan which
declared as operative the 2002 Annual Budget of
the Municipality of Mayoyao, Ifugao on 10 June
2002.
Petitioners also claim that the amount allocated in
the 2002 municipal budget for personal services is
within the allowable limits prescribed by law. In
declaring that the municipality exceeded the
personal services limitation set by law, respondent
COA based its finding on a computation using the
rates prescribed in LBC No. 75, and not LBC No. 74,
in relation to LBC No. 69, on which the municipality
based its computation. Petitioners further explain
that when the municipality enacted Resolution No.
94, s. 2002, re-aligning the amount appropriated for
the 17 newly created positions to the 5% salary
increase of the municipal personnel, it did so with
the understanding that the 17 newly created
positions were vacated and/or abolished. Thus, the
re-alignment of the aforesaid amount was done
without decreasing the whole amount originally
earmarked for personal services.
Claiming good faith, petitioners insist that
Resolution No. 66, s. 2002 was enacted on 2 July
2002, while LBC No. 75 was issued by DBM on 12
July 2002 and was received by them at a much later
date; that Notice of Disallowance No. 03-006 was
issued only on 16 May 2003, after the municipality
had already implemented the 5% salary increase
pursuant to Resolution Nos. 66 and 94, s. 2002; and
that the Sangguniang Panlalawigan recognized the
good faith of the municipality when it enacted
Resolution No. 2004-1185 where it reconsidered its
earlier Resolution No. 2003-808.

We PARTIALLY GRANT the petition.
The COA disallowed the amount of P895,891.50 on
the ground that the 5% salary increase exceeded the
total allowable appropriations of the municipality
for personal services provided by law, specifically
Section 325(a)[27] of the LGC. It based its finding on
the recomputation made by Ms. Virginia B. Farro,
Provincial Budget Officer of Ifugao, which showed
that the Annual Budget of the municipality
exceeded the personal services limit
by P3,944,568.05.[28] According to the COA, the
municipalitys budget adopted the salary rates under
LBC No. 69 instead of the salary rates prescribed
under LBC No. 74 which is the applicable circular in
this case.[29]
As regards petitioners reliance on Resolution No.
2002-556 of the Sangguniang Panlalawigan, the
COA in its Decision No. 2005-071 made it clear that
the review of the 2002 municipal budget by
the Sangguniang Panlalawigan was only limited to
the provisions stated in the said budget which
contained, among others, provisions for the funding
of the 17 newly created positions, and not its re-
alignment to the 5% salary increase. Consequently,
the declaration by the Sangguniang Panlalawigan in
the said Resolution that the 2002 municipal budget
was operative did not include the grant of the 5%
salary increase, as the same was not contained in
the said budget but in Resolution No. 66, s. 2002.[30]
We find that the COA correctly affirmed the
disallowance of the amount of P895,891.50.
At the outset, it must be stressed that factual
findings of administrative bodies charged with their
specific field of expertise, are afforded great weight
by the courts, and in the absence of substantial
showing that such findings were made from an
erroneous estimation of the evidence presented,
they are conclusive, and in the interest of stability of
the governmental structure, should not be
disturbed.[31]
In this case, the assailed Decisions of the COA clearly
presented the factual findings and adequately
explained the legal basis for disallowing the said
amount. Indeed, as computed by Ms. Virginia Farro,
the Provincial Budget Officer of Ifugao, the annual
budget of Mayoyao for 2002 exceeded the limit for
personal services as prescribed in Section 325(a) of
the LGC by P3,944,568.05. Further, it was
established that the grant of the increase through
the adoption of higher salary class schedule is not
among the list of items and activities whereby the
limitation for personal services may be waived
pursuant to LBC No. 75. Finally, the municipality
adopted the salary rates under LBC No. 69 and not
the salary rates under LBC No. 74. No grave abuse of
discretion amounting to lack or excess of jurisdiction
can thus be attributed to respondent COA. Grave
abuse of discretion exists where an act of a court or
tribunal is performed with a capricious or whimsical
exercise of judgment 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.[32]
However, we find that petitioners should not be
ordered to refund the disallowed amount because
they acted in good faith.
In Abanilla v. Commission on Audit,[33] the Board of
Directors of the Metropolitan Cebu Water District
(MCWD) issued several resolutions giving benefits
and privileges to its personnel which included
hospitalization privileges, monetization of leave
credits, Christmas bonus, and longevity
allowance. MCWD likewise entered into a collective
bargaining agreement (CBA) with the employees
union providing for benefits, such as cash advances,
13th month pay, mid-year bonus, Christmas bonus,
vacation and leave credits, hospitalization,
medicare, uniform privileges and water allowance.
However, the COA disallowed the amount
of P12,221,120.86 representing hospitalization
benefits, mid-year bonus, 13th month pay, Christmas
bonus and longevity pay on the ground that the
compensation package of MCWD personnel may no
longer be subject of a CBA, as its officers and
employees were covered by the Civil Service laws,
and not by the Labor Code.
On petition for certiorari before this Court, the
disallowance by COA was sustained; however, the
MCWD personnel who received those benefits were
no longer required to refund the same. The Court
held, thus:
While we sustain the disallowance of the above
benefits by respondent COA, however, we find that
the MCWD affected personnel who received the
above mentioned benefits and privileges acted in
good faith under the honest belief that the CBA
authorized such payment. Consequently, they need
not refund them.
In Querubin vs. Regional Cluster Director, Legal and
Adjudication Office, COA Regional Office VI, Pavia,
Iloilo City, citing, De Jesus vs. Commission on
Audit, this Court held.:
Considering, however, that all the parties here acted
in good faith, we cannot countenance the refund of
subject incentive benefits for the year 1992, which
amounts the petitioners have already
received. Indeed, no indicia of bad faith can be
detected under the attendant facts and
circumstances. The officials and chiefs of offices
concerned disbursed such incentive benefits in the
honest belief that the amounts given were due to
the recipients and the latter accept the same with
gratitude, confident that they richly deserve such
benefits.
x x x. Petitioners here received the additional
allowances and bonuses in good faith under the
honest belief that the LWUA Board Resolution No.
313 authorized such payment. At the time
petitioners received the additional allowances and
bonuses, the Court had not yet decided Baybay
Water District. Petitioners had no knowledge that
such payment was without legal basis.Thus, being in
good faith, petitioners need not refund the
allowances and bonuses they received but
disallowed by the COA.[34]
In Blaquera v. Alcala,[35] petitioners who were
officials and employees of several government
agencies were paid productivity incentive benefits
for the year 1992 pursuant to Executive Order No.
292, otherwise known as the Administrative Code of
1987. On 19 January 1993, then President Fidel V.
Ramos issued Administrative Order No. 29 limiting
the grant of productivity incentive benefits for the
year 1992 in the maximum amount of P1,000.00
and enjoining the grant of said benefit without prior
approval of the President.
Consequently, all agencies that authorized the
payment of productivity incentive benefits for the
year 1992 in excess of P1,000.00 were directed to
immediately cause the return/refund of the excess
amount. Thus, respondents therein caused the
deduction, from petitioners salaries or allowances,
of the amounts needed to cover the alleged
overpayments.
On petition before the Court, it was held that
Administrative Order No. 29 limiting the amount of
incentive benefits and enjoining heads of
government agencies from granting incentive
benefits without prior approval of the President,
was a valid exercise of the Presidents power of
control and authority over executive
departments. As regards petitioners contention that
respondents should be held personally liable for the
refund in question, the Court held, thus:
Untenable is petitioners contention that the herein
respondents be held personally responsible for the
refund in question. Absent a showing of bad faith or
malice, public officers are not personally liable for
damages resulting from the performance of official
duties.
Every public official is entitled to the presumption of
good faith in the discharge of official duties. Absent
any showing of bad faith and malice, there is
likewise a presumption of regularity in the
performance of official duties.
In upholding the constitutionality of AO 268 and AO
29, the Court reiterates the well-entrenched
doctrine that in interpreting statutes, that which will
avoid a finding of unconstitutionality is to be
preferred.
Considering, however, that all the parties here acted
in good faith, we cannot countenance the refund of
subject incentive benefits for the year 1992, which
amounts the petitioners have already
received. Indeed, no indicia of bad faith can be
detected under the attendant facts and
circumstances. The officials and chiefs of offices
concerned disbursed such incentive benefits in the
honest belief that the amounts given were due to
the recipients and the latter accepted the same with
gratitude, confident that they richly deserve such
benefits.[36]
This ruling has been consistently applied in several
cases.[37]
In the instant case, although the 5% salary increase
exceeded the limitation for appropriations for
personal services in the Municipality of Mayoyao,
this alone is insufficient to overthrow the
presumption of good faith in favor of petitioners as
municipal officials. It must be mentioned that the
disbursement of the 5% salary increase of municipal
personnel was done under the color and by virtue of
resolutions enacted pursuant to LBC No. 74, and
was made only after the Sangguniang
Panlalawigan declared operative the 2002
municipal budget. In fact, the Notice of
Disallowance was issued only on 16 May 2003, after
the municipality had already implemented the
salary increase.Moreover, in its Resolution No.
2004-1185,[38] the Sangguniang
Panlalawigan reconsidered its prior disallowance of
the adoption of a first class salary schedule and 5%
salary increase of
the Municipality of Mayoyao based on its finding
that the municipal officials concerned acted in good
faith, thus:
WHEREAS, the Sangguniang Bayan of Mayoyao
however justified that their realignment of the
amount of Php 1,936,524.96 and the adoption of a
first class salary was done in good faith and with the
purpose of giving decent pay to officials and
employees of the said Municipality considering the
high cost of living;
WHEREAS, this Body finding merit on the
justification of the said Municipality hereby
reconsiders its earlier stand on the disallowed
adoption of a first class salary schedule and the 5%
salary increase of the Municipality of Mayoyao,
Ifugao;
x x x x.[39]
Furthermore, granting arguendo that the
municipalitys budget adopted the incorrect salary
rates, this error or mistake was not in any way
indicative of bad faith. Under prevailing
jurisprudence, mistakes committed by a public
officer are not actionable, absent a clear showing
that he was motivated by malice or gross negligence
amounting to bad faith. It does not simply connote
bad moral judgment or negligence. Rather, there
must be some dishonest purpose or some moral
obliquity and conscious doing of a wrong, a breach
of a sworn duty through some motive or intent, or ill
will. It partakes of the nature of fraud and
contemplates a state of mind affirmatively
operating with furtive design or some motive of
self-interest or ill will for ulterior purposes.[40] As we
see it, the disbursement of the 5% salary increase
was done in good faith. Accordingly, petitioners
need not refund the disallowed disbursement in the
amount of P895,891.50.
WHEREFORE, the instant Petition is PARTIALLY
GRANTED. The Decision of the Commission on Audit
No. 2005-071 dated 29 December 2005 and its
Decision No. 2007-040 dated 25 October 2007
affirming the disallowance of the 5% salary increase
of the municipal personnel of Mayoyao, Ifugao,
covering the period 15 February to 30 September
2002 in the amount of P895,891.50,
are AFFIRMED with MODIFICATION that petitioners
need not refund the said disallowed amount
of P895,891.50.
SO ORDERED.
G.R. No. 181559 October 2, 2009
LEAH M. NAZARENO, CARLO M. CUAL, ROGELIO B. CLAMONTE, FLORECITA M. LLOSA, ROGELIO S.
VILLARUBIA, RICARDO M. GONZALES, JR., ROSSEL MARIE G. GUTIERREZ, NICANOR F. VILLAROSA, JR.,
MARIE SUE F. CUAL, MIRAMICHI MAJELLA B. MARIOT, ALMA F. RAMIREZ, ANTOLIN D. ZAMAR, JR., MARIO
S. ALILING, TEODULO SALVORO, JR., PHILIP JANSON ALTAMARINO, ANTONIETTA PADURA, ADOLFO R.
CORNELIA, IAN RYAN PATULA, WILLIAM TANOY, VICTOR ARBAS, JEANITH CUAL, BRAULIO SAYSON, DAWN
M. VILLAROSA, AGUSTIN A. RENDOQUE, ENRIQUETA TUMONGHA, LIONEL P. BANOGON, ROSALITO
VERGANTINOS, MARIO T. CUAL, JR., ELAINE MAY TUMONGHA, NORMAN F. VILLAROSA, RICARDO C.
PATULA, RACHEL BANAGUA, RODOLFO A. CALUGCUGAN, PERGENTINO CUAL, BERNARD J. OZOA, ROGER
JOHN AROMIN, CHERYL E. NOCETE, MARIVIC SANCHEZ, CRISPIN DURAN, REBECO LINGCONG, ANNA LEE
ESTRABELA, MELCHOR B. MAQUILING, RAUL MOLAS, OSCAR KINIKITO, DARWIN B. CONEJOS, ROMEL CUAL,
ROQUETA AMOR, DISODADO LAJATO, PAUL PINO, LITO PINERO, RODULFO ZOSA, JR. and JORGE
ARBOLADO, Petitioners,
- versus -
CITY OF DUMAGUETE, represented by CITY MAYOR AGUSTIN PERDICES, DOMINADOR DUMALAG, JR.,
ERLINDA TUMONGHA, JOSEPHINE MAE FLORES AND ARACELI CAMPOS, Respondents.
x - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
DECISION On October 25, 1999, pursuant to the Commissions
Accreditation Program, the CSC issued Resolution
DEL CASTILLO, J.: No. 992411,[3] which granted the City Government
The integrity and reliability of our civil service is, of Dumaguete the authority to take final action on
perhaps, never more sorely tested than in the all its appointments, subject to, inter alia, the
impassioned demagoguery of elections. Amidst the following conditions:
struggle of personalities, ideologies, and platforms,
the vigor and resilience of a professional civil service 1. That the exercise of said authority shall be subject
can only be preserved where our laws ensure that to Civil Service Law, rules and regulations and within
partisanship plays no part in the appointing process. the limits and restrictions of the implementing
Consequently, we affirm the validity of a regulation guidelines of the CSC Accreditation Program as
issued by the Civil Service Commission (CSC or the amended (MC No. 27, s. 1994);
Commission) intended to ensure that appointments
and promotions in the civil service are made solely xxxx
on the basis of qualifications, instead of political
loyalties or patronage. 5. That appointments issued under this authority
shall be subject to monthly monitoring by the [Civil
This Petition for Review on Certiorari filed under Service Field Office] CSFO concerned;
Rule 45 of the Rules of Court seeks to reverse the
Decision[1] of the Court of Appeals dated August 28, xxxx
[2]
2007 and its Resolution dated January 11, 2008 in
CA-G.R. CEB-SP No. 00665. The case stemmed from 9. That appointments found in the course of
CSC Field Offices invalidation of petitioners monthly monitoring to have been issued and acted
appointments as employees of the City of upon in violation of pertinent rules, standards, and
Dumaguete, which was affirmed by the CSC regulations shall immediately be invalidated by the
Regional Office, by the Commission en banc and by Civil Service Regional Office (CSRO), upon
the Court of Appeals. recommendation by the CSFO.

LEGAL AND FACTUAL BACKGROUNDS Appointments made by outgoing Mayor Remollo

Accreditation of Dumaguete City by the Civil Then Dumaguete City Mayor Felipe Antonio B.
Service Commission Remollo sought re-election in the May 14, 2001
elections, but lost to respondent Mayor Agustin R.
Perdices. Thereafter, on June 5, 7, and 11, 2001,
outgoing Mayor Remollo promoted 15 city hall
employees, and regularized another 74 city hall
employees, including the herein 52 petitioners.
On July 2, 2001, Mayor Perdices publicly announced
at the flag raising ceremony at the Dumaguete City
Hall grounds that he would not honor the
appointments made by former Mayor Remollo. On
the same day, he instructed the City Administrator,
respondent Dominador Dumalag, Jr., to direct
respondent City Assistant Treasurer Erlinda C.
Tumongha (now deceased), to refrain from making
any cash disbursements for payments of petitioners'
salary differentials based on their new positions.
The Petition for Mandamus before the Regional
Trial Court of Dumaguete City
Thus, on August 1, 2001, petitioners filed a Petition
for Mandamus with Injunction and Damages with
Prayer for a Temporary Restraining Order against
the City of Dumaguete, represented by respondent
city mayor Perdices and city officers Dumalag,
Tumongha, Josephine Mae Flores, and Araceli
Campos. The petition was docketed as Civil Case No.
13013, and raffled to Branch 41 of the Regional Trial
Court of Dumaguete City. Petitioners sought the
issuance of a writ of preliminary injunction to enjoin
respondents from taking any action or issuing any
orders nullifying their appointments.
In a Decision[4] dated March 27, 2007, the Regional
Trial Court dismissed the petition; petitioners
Motion for Reconsideration was also denied in an
Order[5] dated April 26, 2007. The issues involved in
Civil Case No. 13013 have twice been elevated to
and eventually resolved by the Court in G.R. Nos.
177795[6] and 168484.[7]
Revocation of Appointments by the Civil Service
Commission Field Office
Relative to this main case, on August 1, 2001, the
CSC Field Office in Dumaguete City, through Director
II Fabio R. Abucejo, revoked and invalidated the
appointments of the petitioners (the August 1, 2001
Order) based of the following findings:
1. There were a total of 15 promotional
appointments and 74 original appointments issued
as reflected in the submitted [Report of Personnel
Actions] ROPA for the month of June 2001.
2. There was only one (1) en banc meeting of the
City Personnel Selection Board (PSB) held on 5 June
2001 to consider the number of appointments thus
issued and there was no other call for a PSB meeting
certified to by the City [Human Resource
Management Officer] HRMO.
3. There were no minutes available to show the
deliberations of the PSB of the 89 appointments
listed in the ROPA as certified by the City HRMO.
4. There were no PSB statements certifying that
there was actual screening and evaluation done on
all candidates for each position.
5. The appointing officer of the 89 appointments
was an outgoing local official who lost during the 14
May 2001 elections for City Mayor of Dumaguete
City.
6. The 89 appointments were all issued after the
elections and when the new city mayor was about
to assume office.[8]
Director Abucejo invalidated the appointments as
the same were done in violation of CSC Resolution
No. 010988 dated June 4, 2001, the pertinent
portions of which provide:
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 or after the
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, the practice of some outgoing local chief
executives causes animosities between the outgoing
and incoming officials and the people who are
immediately affected and are made to suffer the
consequences thereof are the ordinary civil
servants, and eventually, to a large extent, their
constituents themselves;
WHEREAS, one of the reasons behind the
prohibition in issuing appointments or hiring 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;[9]
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
7160) or in the Civil Service Law (Book V of
Executive Order No. 292) of the abovestated
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;
xxxx
NOW THEREFORE, the Commission, pursuant to its
constitutional mandate as the control personnel
agency of the government, hereby issues and
adopts the following guidelines:
xxxx
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.
On September 4, 2001, petitioners filed a Motion
for Reconsideration of the August 1, 2001 Order
before the CSC Region VII Office in Cebu. The
motion was, however, denied on the ground that it
should have been filed before the office of Director
Abucejo in Dumaguete City. Thereafter, on October
31, 2001, petitioners asked the CSC Region VII Office
in Cebu to treat their previous Motion for
Reconsideration as their appeal.
On February 14, 2002, the CSC Region VII Office
affirmed the August 1, 2001 Order. Subsequently,
an Appeal to the Commission en banc was filed
through registered mail by 52 of the original 89
appointees, the petitioners herein, namely:
 Date of
Name Former Position New Position Appointment
1. Leah M. Nazareno Legal Researcher Asst. Dept. Head I 7-Jun-01
2. Carlo M. Cual Legislative Staff Legislative Staff 5-Jun-01
Officer I Officer III
3. Rogelio B. Clamonte Public Services Supply Officer IV 5-Jun-01
4. Florecita Llosa Supply Officer I Records Officer II 11-Jun-01
5. Rogelio S. Villarubia Agriculturist II Agriculturist III 5-Jun-01
6. Rossel Marie G. Gutierrez Casual/Plantilla Supervising 5-Jun-01
Environmental
Management
Specialist
7. Nicanor F. Villarosa, Jr. Casual/Plantilla Dentist II 5-Jun-01
8. Marie Sue Cual Casual/Plantilla Social Welfare 7-Jun-01
Officer I
9. Miramichi Majella B. Mariot Casual/Plantilla Records Officer II 7-Jun-01
10. Alma F. Ramirez Casual/Plantilla Clerk IV 7-Jun-01
11. Antolin D. Zamar, Jr. Casual/Plantilla Metro Aide II 11-Jun-01
12. Mario S. Aliling Casual/Plantilla Driver II 5-Jun-01
13. Teodulo Salvoro, Jr. Casual/Plantilla Metro Aide II 5-Jun-01
14. Philip Janson Altamarino Casual/Plantilla Clerk I 5-Jun-01
15. Antonieta Padura Casual/Plantilla Metro Aide II 11-Jun-01
16. Adolfo Cornelia Casual/Plantilla Metro Aide II 11-Jun-01
17. Ian Ryan Patula Casual/Plantilla Metro Aide II 7-Jun-01
18. William Tanoy Casual/Plantilla Metro Aide II 5-Jun-01
19. Victor Arbas Casual/Plantilla Public Services 7-Jun-01
Foreman
20. Jeanith Cual Casual/Plantilla Utility Worker II 5-Jun-01
21. Braulio Sayson Casual/Plantilla Mechanical Plant 7-Jun-01
Supervisor
22. Dawn Villarosa Casual/Plantilla Clerk I 7-Jun-01
23. Agustin Rendoque Casual/Plantilla Utility Worker I 7-Jun-01
24. Enriqueta Tumongha Casual/Plantilla Utility Worker II 5-Jun-01
25. Lionel Banogon Casual/Plantilla Clerk II 5-Jun-01
26. Rosalito Vergantinos Casual/Plantilla Pest Control 5-Jun-01
Worker II
27. Mario Cual, Jr. Casual/Plantilla Utility Foreman 7-Jun-01
28. Elaine Tumongha Casual/Plantilla Registration 11-Jun-01
Officer I
29. Norman Villarosa Casual/Plantilla Utility Worker I 5-Jun-01
30. Ricardo C. Patula Casual/Plantilla Revenue 5-Jun-01
Collection Clerk I
31. Rachel Banagua Casual/Plantilla Utility Worker I 5-Jun-01
32. Rodolfo Calugcugan Job Order Driver I 7-Jun-01
33. Pergentino Cual Job Order Metro Aide II 11-Jun-01
 Date of
Name Former Position New Position Appointment
34. Bernard Ozoa Job Order Utility Worker I 7-Jun-01
35. Roger J. Aromin Job Order Utility Worker I 7-Jun-01
36. Cheryl Nocete Job Order Utility Worker I 11-Jun-01
37. Marivic Sanchez Job Order Utility Worker I 11-Jun-01
38. Crispin Duran Job Order Metro Aide II 11-Jun-01
39. Rebeco Lingcong Job Order Metro Aide II 5-Jun-01
40. Anna Lee Estrabela Job Order Cash Clerk III 5-Jun-01
41. Melchor Maquiling Job Order Engineer I 7-Jun-01
42. Raul Molas Job Order Construction and 7-Jun-01
Maintenance
Foreman
43. Oscar Kinikito Job Order Electrician II 7-Jun-01
44. Darwin Conejos Job Order Engineering Aide 7-Jun-01
45. Romel Cual Job Order Metro Aide II 11-Jun-01
46. Roqueta Amor Job Order Dental Aide 5-Jun-01
47. Diosdado Lajato Job Order Pest Control 5-Jun-01
Worker II
48. Paul Pino Job Order Utility Worker II 5-Jun-01
49. Lito Piero Job Order Metro Aide II 11-Jun-01
50. Rodulfo Zosa, Jr. Job Order Metro Aide II 11-Jun-01
51. Jorge Arbolado Job Order Traffic Aide I 5-Jun-01
52. Ricardo M. Gonzales, Jr. OIC-General Asst. Dept. Head I 5-Jun-01
Services Officer
not be allowed, particularly when the appointments
Ruling of the CSC en banc and the Court of Appeals were issued by the appointing authority who lost in
said election.
On August 23, 2004, the CSC en banc issued
Resolution No. 040932 denying petitioners' appeal, Petitioners filed a Motion for Reconsideration which
and affirming the invalidation of their appointments was denied by the Commission on April 11, 2005,
on the ground that these were mass appointments through CSC Resolution No. 050473.
made by an outgoing local chief executive.[10] The
Commission explained: Petitioners then filed a petition for review before
the Court of Appeals, which was docketed as CA-
The rationale behind the prohibition in CSC G.R. CEB-SP No. 00665. On August 28, 2007, the
Resolution No. 01-0988 is not hard to comprehend. Court of Appeals denied the appeal and affirmed
The prohibition is designed to discourage losing CSC Resolution No. 040932 dated August 23, 2004
candidates from extending appointments to their and CSC Resolution No. 050473 dated April 11,
protgs or from giving their constituents promised 2005, ratiocinating that:
positions (CSC Resolution No. 97-0317 dated
January 17, 1997, Re: Roldan B. Casinillo). The spirit behind CSC Resolution No. 010988 is
Moreover, the same is intended to prevent the evident from its preamble. It was issued to thwart
outgoing local chief executive from hurriedly issuing the nefarious practice by outgoing local chief
appointments which would subvert the policies of executives in making appointments before, during,
the incoming leadership. Thus, any means that and/or after the regular local elections for ulterior
would directly or indirectly circumvent the purposes partisan motives. Said practice being analogous to
for which said Resolution was promulgated should
midnight appointments by the President or Acting
President, the CSC then promulgated Resolution No.
010988, to suppress the mischief and evils
attributed to mass appointments made by local
chief executives.
Petitioners Motion for Reconsideration was denied
by the Court of Appeals in a Resolution dated
January 11, 2008.
THE PARTIES ARGUMENTS
Before us, petitioners maintain that CSC Resolution
No. 010988 is invalid because the Commission is
without authority to issue regulations prohibiting
mass appointments at the local government
level. Petitioners cite De Rama v. Court of
Appeals[11] which held that Section 15, Article VII of
the Constitution is only applicable to the President
or Acting President. They claim that outgoing or
defeated local appointing authorities are authorized
to make appointments of qualified individuals until
their last day in office, and that not all mass
appointments are invalid. Finally, petitioners claim
that because Dumaguete City had been granted
authority to take final action on all appointments,
the Commission did not have any authority to
disapprove the appointments made by outgoing
mayor Remollo.
In their Comment dated May 15,
2008,[12] respondents argue that petitioners
appointments violated civil service rules and
regulations other than CSC Resolution No.
010988. Respondents also assert that the
Commission is authorized to invalidate the
petitioners appointments, because the CSC
accreditation program carried with it the caveat that
said exercise of authority shall be subject to Civil
Service law, rules and regulations. Finally,
respondents claim that petitioners were guilty of
forum shopping because the issues in this case and
in G.R. No. 177795 are the same.
OUR RULING
We find that the Civil Service Commission has the
authority to issue CSC Resolution No. 010988 and
that the invalidation of petitioners appointments
was warranted. Consequently, we affirm the
Decision of the Court of Appeals dated August 28,
2007 and its Resolution dated January 11, 2008 in
CA-G.R. CEB-SP No. 00665.
The CSC has the authority to establish rules to
promote efficiency in the civil service
The Commission, as the central personnel agency of
the government,[13] has statutory authority to
establish rules and regulations to promote efficiency
and professionalism in the civil service. Presidential
Decree No. 807,[14] or the Civil Service Decree of the
Philippines, provides for the powers of the
Commission, including the power to issue rules and
regulations and to review appointments:
Section 9: Powers and functions of the
Commission The Commission shall administer the
Civil Service and shall have the following powers
and functions:
xxxx
(b) Prescribe, amend, and enforce suitable
rules and regulations for carrying into effect the
provisions of this Decree x x x
(c) Promulgate policies, standards, and
guidelines for the Civil Service and adopt plans and
programs to promote economical, efficient, and
effective personnel administration in the
government;
xxxx
(h) Approve all appointments, whether original
or promotional, to positions in the civil service,
except those of presidential appointees, members
of the armed forces of the Philippines, police forces,
firemen, and jailguards, and disapprove those
where the appointees do not possess the
appropriate eligibility or required qualifications;
(Emphasis supplied)
Executive Order No. 292, or the Administrative Code
of 1987, also provides:
Section 12: Powers and Functions The Commission
shall have the following powers and functions:

xxxx
(2) prescribe, amend, and enforce rules and
regulations for carrying into effect the provisions of
the Civil Service Law and other pertinent laws;
(3) promulgate policies, standards, and
guidelines for the Civil Service and adopt plans and
programs to promote economical, efficient, and
effective personnel administration in the
government;
(4) take appropriate action on all appointments
and other personnel matters in the Civil Service
including extension of Service beyond retirement
age;
(5) inspect and audit the personnel actions and
programs of the departments, agencies, bureaus,
offices, local government units, and other
instrumentalities of the government, including
government owned and controlled corporations.
(emphasis supplied)
Clearly, the above-cited statutory provisions
authorize the Commission to prescribe, amend, and
enforce rules to cover the civil service. The
legislative standards to be observed and respected
in the exercise of such delegated authority are set
out in the statutes, to wit: to promote economical,
efficient, and effective personnel administration.
The Reasons behind CSC Resolution No. 010988
We also find that there was substantial reason
behind the issuance of CSC Resolution No. 010988.
It is true that there is no constitutional prohibition
against the issuance of mass appointments by
defeated local government officials prior to the
expiration of their terms. Clearly, this is not the
same as a midnight appointment, proscribed by the
Constitution, which refers to those appointments
made within two months immediately prior to the
next presidential election.[15] As we ruled in De
Rama v. Court of Appeals:[16]
The records reveal that when the petitioner brought
the matter of recalling the appointments of the
fourteen (14) private respondents before the CSC,
the only reason he cited to justify his action was
that these were midnight appointments that are
forbidden under Article VII, Section 15 of the
Constitution. However, the CSC ruled, and correctly
so, that the said prohibition applies only to
presidential appointments. In truth and in fact,
there is no law that prohibits local elective officials
from making appointments during the last days of
his or her tenure.
However, even while affirming De Rama, we
explained in Quirog v. Aumentado,[17] that:
We, however, hasten to add that the
aforementioned ruling does not mean that
the raison d' etre behind the prohibition against
midnight appointments may not be applied to those
made by chief executives of local government units,
as here. Indeed, the prohibition is precisely
designed to discourage, nay, even preclude, losing
candidates from issuing appointments merely for
partisan purposes thereby depriving the incoming
administration of the opportunity to make the
corresponding appointments in line with its new
policies. (Emphasis supplied)
Quirog also involved the disapproval of an
appointment for non-compliance with CSC
Resolution No. 010988. However, we found that
Quirogs appointment was made on June 1, 2001, or
three days prior to the issuance of CSC Resolution
No. 010988. As such, we ruled that the retroactive
application of the law was not warranted.
In Sales v. Carreon, Jr.,[18] we had occasion to discuss
the reasons behind the prohibition by the
Commission of mass appointments after the
elections. Sales involved the issuance of 83
appointments made by then Dapitan City Mayor
Joseph Cedrick O. Ruiz in his last month of office (on
June 1, 18, and 27, 2001), which the newly elected
Mayor, Rodolfo H. Carreon, subsequently revoked,
on the ground that these violated CSC Resolution
No. 010988 in relation to CSC Memorandum Circular
No. 7, Series of 2001, imposing a ban on issuing
appointments in the civil service during the election
period. In Sales, we declared:
This case is a typical example of the practice of
outgoing local chief executives to issue "midnight"
appointments, especially after their successors have
been proclaimed. It does not only cause animosities
between the outgoing and the incoming officials,
but also affects efficiency in local governance. Those
appointed tend to devote their time and energy in
defending their appointments instead of attending
to their functions.[19]
It is not difficult to see the reasons behind the
prohibition on appointments before and after the
elections. 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
[20]
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.
Not all Mass Appointments are Prohibited
Indeed, not all appointments issued after the
elections by defeated officials are invalid. CSC
Resolution No. 010988 does not purport to nullify all
mass appointments. However, it must be shown
that the appointments have undergone the regular
screening process, that the appointee is qualified,
that there is a need to fill up the vacancy
immediately, and that the appointments are not in
bulk. In Nazareno v. Dumaguete,[21] we explained:
CSC Resolution No. 010988 does not totally
proscribe the local chief executive from making any
appointments immediately before and after
elections. The same Resolution provides that the
validity of an appointment issued immediately
before and after elections by an outgoing local chief
executive is to be determined on the basis of the
nature, character, and merit of the individual
appointment and the particular circumstances
surrounding the same.
Corollarily, we held in Sales,[22] that:
x x x [e]ach appointment must be judged on the
basis of the nature, character, and merits of the
individual appointment and the circumstances
surrounding the same. It is only when the
appointments were made en masse by the outgoing
administration and shown to have been made
through hurried maneuvers and under
circumstances departing from good faith, morality,
and propriety that this Court has struck down
"midnight" appointments.
In the instant case, Mayor Remollo issued the 89
original and promotional appointments on three
separate dates, but within a ten-day period, in the
same month that he left office.[23] Further, the
Commissions audit found violations of CSC rules and
regulations that justified the disapproval of the
appointments. In this regard, CSC Memorandum
Circular No. 40, otherwise known as the Revised
Rules on Appointments and Other Personnel
Actions, provides:
Section 1 Appointments submitted to the CSC office
concerned should meet the requirements listed
hereunder. Non-compliance with such requirements
shall be grounds for disapproval of said
appointments:
xxxx
(h) Personnel Selection Board (PSB)
Evaluation/Screening. Appointees should be
screened and evaluated by the PSB, if applicable. As
proof thereof, a certification signed by the Chairman
of the Board at the back of the appointment or
alternatively, a copy of the proceedings/ minutes of
the Boards deliberation shall be submitted together
with the appointment. The issuance of the
appointment shall not be earlier than the date of
the final screening/deliberation of the PSB.
Here, there was only one en banc meeting of the
city PSB to consider the appointments, without any
evidence that there were any deliberations on the
qualifications of the petitioners, or any indication
that there was an urgent need for the immediate
issuance of such appointments. The absence of
evidence showing careful consideration of the
merits of each appointment, and the timing and the
number of appointments, militate against
petitioners cause. On the contrary, the prevailing
circumstances in this case indicate that the
appointments were hurriedly issued by the outgoing
administration.
The Accreditation of Dumaguete City did not
remove the CSCs authority to review appointments
We find that the authority granted by CSC
Resolution No. 992411 to the City Government of
Dumaguete to take final action on all its
appointments did not deprive the Commission of its
authority and duty to review appointments. Indeed,
Resolution No. 992411 states that such exercise of
authority shall be subject to civil service law, rules
and regulations and that appointments in violation
of pertinent rules shall immediately be invalidated.
Moreover, Section 20, Rule VI of the Omnibus Rules
Implementing Book V of Executive Order No. 292
provides that notwithstanding the initial approval of
an appointment, the same may be recalled for
[v]iolation of other existing Civil Service laws, rules
and regulations. The CSC is empowered to take
appropriate action on all appointments and other
personnel actions and that such power includes the
authority to recall an appointment initially approved
in disregard of applicable provisions of Civil Service
law and regulations.[24]
Petitioners have not engaged in forum shopping
The essence of forum-shopping is the filing of
multiple suits involving the same parties for the
same cause of action, either simultaneously or
successively, for the purpose of obtaining a
favorable judgment.[25] Forum-shopping has been
defined as the act of a party 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 on the supposition that one or the other court
would make a favorable disposition.[26]
Although the factual antecedents of the cases
brought before this Court are the same, they involve
different issues. The petition for Mandamus with
Injunction and Damages, docketed as Civil Case No.
13013, and raised before this Court as G.R. No.
177795, challenged respondents refusal to
recognize petitioners appointments and to pay
petitioners salaries, salary adjustments, and other
emoluments. The petition only entailed the
applications for the issuance of a writ
of mandamus and for the award of damages. The
present case docketed as G.R. No. 181559, on the
other hand, involves the merits of petitioners
appeal from the invalidation and revocation of their
appointments by the CSC-Field Office, which was
affirmed by the CSC-Regional Office, CSC en banc,
and the Court of Appeals.
In any event, this issue had already been settled in
our Decision of June 19, 2009 in G.R. No. 177795,
which found petitioners not guilty of forum
shopping, to wit:
True, that the [Petition in G.R. No. 177795] and the
one in G.R. No. 181559 are interrelated, but they
are not necessarily the same for this Court to
adjudge that the filing of both by petitioners
constitutes forum shopping. In G.R. No. 181559, the
Court will resolve whether or not the petitioners
appointments are valid. [In G.R. No. 177795],
petitioners are claiming a right to the salaries, salary
adjustments and other emoluments during the
pendency of the administrative cases, regardless of
how the CSC decided the validity of their
appointments.
WHEREFORE, the petition is DENIED for lack of
merit. The Court of Appeals Decision in CA-G.R.
CEB-SP No. 00665 dated August 28, 2007 affirming
CSC Resolution No. 040932 dated August 23, 2004
and CSC Resolution No. 050473 dated April 11,
2005, and its Resolution dated January 11, 2008
denying the Motion for Reconsideration
are AFFIRMED.
SO ORDERED.
REPUBLIC OF G.R. No. 165332
THE PHILIPPINES, Assailed in this Petition for Review on Certiorari is
Petitioner, the Resolution[2] of the Court of Appeals (CA) in CA-
Present: G.R. SP No. 83787, dated 11 August 2004 dismissing
outright petitioners Petition for Certiorari for being
YNARES- the wrong legal remedy to impugn the final order of
SANTIAGO,* J., the Regional Trial Court of Manila, Branch 24. Also
- versus - CARPIO MORALES, assailed is the CA Resolution[3] dated 20 September
Acting Chairperson 2004 denying the motion for reconsideration.
BRION,
DEL CASTILLO, and On 6 August 2002, Yang Chi Hao, private respondent
ABAD, JJ. herein, filed a Petition for Naturalization[4] before
the Regional Trial Court of Manila, Branch 24, which
YANG CHI HAO, Promulgated: was docketed as Case No. 02104240. The Republic
Respondent. October 2, 2009 of the Philippines, through the Office of the Solicitor
x----------------------------------x General (OSG), opposed the petition, cross-
examined private respondent and his witnesses, but
did not present any of its own evidence.
DECISION
On 4 September 2003, the trial court issued a
DEL CASTILLO, J.: Decision[5] denying the Petition for
Naturalization. Private respondent filed a Motion for
As early as 1913, we held in Herrera v. Reconsideration which the trial court granted in its
Barretto[1] that: Order[6] dated 25 November 2003. The dispositive
portion of the Order reads:
The office of the writ of certiorari has been reduced
to the correction of defects of jurisdiction solely and Accordingly, in view of all the foregoing, the motion
cannot legally be used for any other purpose. It is for reconsideration is hereby granted.
truly an extraordinary remedy and, in this
jurisdiction, its use is restricted to truly The decision of the Court dated September 4,
extraordinary cases cases in which the action of the 2003 is hereby set aside.
inferior court is wholly void; where any further steps
in the case would result in a waste of time and Petitioner is hereby admitted as citizen of the
money and would produce no result whatever; Republic of the Philippines subject to the provisions
where the parties, or their privies, would be utterly of Republic Act No. 530. After the period of two (2)
deceived; where a final judgment or decree would years and upon compliance with all the legal
be nought but a snare and a delusion, deciding requirements the appropriate Certification of
nothing, protecting nobody, a judicial pretension, a Naturalization shall be issued, to be registered in
recorded falsehood, a standing menace. It is only to the Civil Registry.
avoid such results as these that a writ of certiorari is
issuable; and even here an appeal will lie if the SO ORDERED.[7]
aggrieved party prefers to prosecute it.
Thereafter, the OSG filed a Motion for
We reiterate these well-established principles: that Reconsideration which was denied by the trial court
only errors of jurisdiction, not errors of judgment, in an Order[8] dated 24 February 2004.
may be entertained in a petition for certiorari;
that certiorari will not lie where an appeal may be Instead of filing an ordinary appeal before the Court
taken or is lost through petitioner's own doing; and of Appeals, the OSG filed a Petition
that questions of fact are not decided by this Court. for Certiorari under Rule 65 of the Rules of Court,
claiming that by reversing its original decision, the
trial court acted with grave abuse of discretion
amounting to lack of jurisdiction. In the herein
assailed Resolution of 11 August 2004, the appellate
court dismissed the petition, declaring that:
This petition for certiorari faces outright dismissal.
xxxx
The present recourse is an incorrect, improper, or a
wrong legal remedy for the simple reason that the
order in question is a final order which disposed of
the case. Hence, the proper recourse therefrom is
an ordinary appeal to be filed within fifteen
(15)[9] days from March 8, 2004, when the OSG
received notice of the denial of its motion for
reconsideration. In other words, the OSG had
until March 23, 2004 to interpose an appeal
therefrom. There is no showing why an appeal was
not taken. Indeed, there is even an allegation that
there is no appeal, nor any plain, speedy and
adequate remedy in the ordinary course of law
other than the instant petition, which is patently
false and misleading. For, to repeat, the OSG had
the obvious remedy of appeal open to it, but failed
to take it for some unknown reason of its own.
In view of such failure, the instant petition
for certiorari cannot be given due course, as it is
settled law, that certiorari is not a substitute for a
lost appeal.[10]
The OSG filed a Motion for Reconsideration but it was
denied by the Court of Appeals in its Resolution dated 20
September 2004.[11]
Hence, this Petition for Review on Certiorari. The OSG
claims that there was no need to file a regular appeal
before the Court of Appeals because: (1) the Rules of
Court apply only in a suppletory manner in naturalization
cases; (2) there was no final decision to appeal, since a
judgment in a naturalization case only becomes final two
years after the promulgation of the decision, when the
Certificate of Naturalization is issued; (3) the trial court
never acquired jurisdiction over the petition because the
National Bureau of Investigation (NBI) reported that
respondent did not reside at the address he provided in
the petition; and (4) the Order of the trial court granting
the petition for naturalization was issued with grave abuse
of discretion amounting to lack of jurisdiction, there being
no compliance by private respondent with the legal
requirements for naturalization, namely, good moral
conduct, possession of lucrative income, and absence of
mental alienation or incurable contagious disease.[12]
In his Comment,[13] private respondent claims that the
Court of Appeals correctly dismissed the petition for being
the wrong mode of remedy. He also argues that as held
by the trial court, he satisfactorily complied with the
requirements of good moral conduct based on
the testimonies of witnesses and
clearances issued by the NBI and police, prosecutor, and
courts of Paraaque City. He insists that the trial court
correctly found him free of any medical impediment
based on the medical certificate issued by the Ann Francis
Maternity and Medical Clinic. As regards the income
requirement, respondent explains that his income from
2000 to 2002 was only P60,000.00 per year because
during that period, he was still a student. Upon
graduation, however, he worked full-time as Marketing
Manager of Food Mart, Inc. with a monthly income
of P60,000.00, evidence of which had been presented
before and assessed by the trial court. Private respondent
disputes the findings of the NBI that he was not known to
his neighbors at No. 743 Gandara Street, Room 402
Evershine Bldg., Binondo, Manila. He claims that the NBI
conducted the background investigation on 26 January
2004 or long after his petition for naturalization was
granted by the trial court on 25 November 2003. He
alleges that after the trial court rendered its decision, he
transferred to his parents residence in Paraaque City. A
new tenant moved in to his former residence who
obviously was not acquainted to him. Finally, private
respondent insists that it is not proper for the OSG to
present evidence long after the RTC decision had become
final.
The OSG filed its Reply on 5 May 2005, insisting that its
recourse to the remedy of certiorari was proper
considering that the trial court, in reconsidering and
reversing its own decision sans the submission of any new
evidence, acted with grave abuse of discretion amounting
to lack of jurisdiction. The OSG also argues that the NBI
report, even if belatedly submitted, clearly showed that
respondent did not live in his stated address, thus ousting
the trial court of its jurisdiction.[14]

The petition lacks merit.
The trial court did not abuse its discretion when it
reconsidered its earlier decision and granted private
respondents petition for naturalization.
By grave abuse of discretion is meant such capricious and
whimsical exercise of judgment which is equivalent to an
excess or lack of jurisdiction. The abuse of discretion must
be so patent and gross as to amount to an evasion of a
positive duty or a virtual refusal to perform a duty
enjoined by law or to act at all in contemplation of law, as
where the power is exercised in an arbitrary and despotic
manner by reason of passion or hostility.[15] It also bears
stressing that the true function of the writ of certiorari is
to keep an inferior court within the bounds of its
jurisdiction, or to relieve parties from the arbitrary acts of
courts.[16]
Viewed against these standards, we find the trial courts
reversal of its decision after the filing of a Motion for
Reconsideration not tainted with grave abuse of
discretion. The reasons for granting the Petition for
Naturalization were enunciated in the Order dated 25
November 2003, as well as in the Order[17] dated 24
February 2004, where the trial court held thus:
In opposing the motion, petitioner alleged that his
documentary and testimonial evidence undisputably and
overwhelmingly satisfied the requirement for good
conduct; that his annual income from year 2000 to year
2002 was P60,000.00 because during that period he was
still studying and worked as a part-time employee only,
but after graduation in October, 2002, and working full
time as marketing manager of Food Mart, his income rose
to P60,000.00 a month, including his commission; and
that the medical certificate he presented proved that after
a thorough medical check up he was found to be
essentially normal.
Considering the allegations in the opposition, the court
gave the Office of the Solicitor General an opportunity to
file its reply. However, as of this writing, no reply was
forthcoming. Hence, this Order.
The Court is not convinced.
Petitioner was able to successfully overcome all the
grounds raised in the Motion for Reconsideration. Indeed,
it is doubtful if the University of Sto. Tomas, a reputable
catholic school, would allow petitioner to be enrolled in its
high school and graduate from its college if his conduct is
questionable or if he has any mental alienation and
incurable contagious disease. Besides, what better proof
of good conduct can petitioner show other than the
clearances issued by our courts, the National Bureau of
Investigation and the police, the government agencies
tasked to issue clearances. And unless proof is shown that
the medical examiner of Ann Francis Maternity & Medical
Clinic falsified the results of petitioners medical check up,
its issuance is considered regular.
Petitioner was likewise able to explain that for the years
2000 to 2002, his income was only P60,000.00 annually
because at that time he was still studying and worked only
as a part-time employee but after graduating in October,
2002, when he worked already as full-time marketing
manager of Food Mart, his income rose to P60,000.00 a
month, including his commissions.[18]
We found no whimsicality or patent abuse of discretion as
would amount to an evasion of positive duty or virtual
refusal to perform a duty enjoined by law or to act at all in
contemplation of law.
Shorn of embellishment, the OSG simply argues that the
trial court erred in granting the petition for naturalization
because it failed to consider material evidence that would
warrant the denial of said petition. If, indeed, there was
error, this is simply an error of judgment in appreciation of
facts and the law. Besides, the trial court has the
discretion to reverse itself upon the filing of a motion for
reconsideration. Indeed, Section 3, Rule 37 of the Rules of
Court is explicit in that a trial court may amend its
judgment or order if it finds that the judgment or final
order is contrary to the evidence or law. If a mistake was
committed by the trial court, it was in the exercise of its
jurisdiction. Thus, the error is one of judgment, not of
jurisdiction; consequently, petitioner's remedy is appeal,
not certiorari.
Petitioner had readily
available remedies.
A basic requisite of the special civil action of certiorari,
which is governed by Rule 65 of the Rules of Court, is that
there is no appeal or any plain, speedy and adequate
remedy in the ordinary course of law. Where appeal is
available, certiorari generally does not
lie. Certiorari cannot be used as a substitute for a lost or
lapsed remedy of appeal.[19]
In this case, an appeal was not only available, but also
mandated by Sections 11[20] and 12[21] of Commonwealth
Act No. 473 (1939), or the Revised Naturalization Law, as
amended. Notably, in Keswani v. Republic,[22] we declared
that the remedy from a decision by the trial court
admitting an individual as a Filipino citizen is through an
appeal to the Court of Appeals.[23]
Moreover, a decision granting a petition for naturalization
becomes executory only two years after its
promulgation. On this matter, Section 1 of Republic Act
No. 530 (1950)[24] provides:
Section 1. The provisions of existing laws notwithstanding,
no petition for Philippine citizenship shall be heard by the
courts until after six months from the publication of the
application required by law, nor shall any decision
granting the application become executory until after two
years from its promulgation and after the court, on proper
hearing, with the attendance of the Solicitor General or his
representative, is satisfied, and so finds, that during the
intervening time the applicant has (1) not left the
Philippines, (2) has dedicated himself continuously to a
lawful calling or profession, (3) has not been convicted of
any offense or violation of Government promulgated
rules, (4) or committed any act prejudicial to the interest
of the nation or contrary to any Government announced
policies.
As such, petitioner is not without a remedy to assail the
grant of citizenship. In addition, it may also move to
have the naturalization certificate cancelled in the proper
proceedings, if it can be shown that the certificate was
obtained fraudulently.[25]
The Supreme Court will not try questions of fact.
Questions of fact are not proper in a Petition brought
under Rule 45 of the Rules of Court. Time and time again,
we have stated that the Supreme Court is not a trier of
facts,[26] and this Court will decline to sift through the
evidence submitted by the parties, particularly here,
where such evidence was not presented before the trial
court. It would be ludicrous indeed if we were to
determine, in the first instance, where respondent
actually resides, his true income, or his current mental
state. Such issues are best threshed out before the trial
court; we have neither the inclination or interest to
resolve these factual matters here.
We end with an admonition. It appears that the OSG
requested the NBI to conduct a confidential investigation
in connection with private respondent's petition for
naturalization as early as 30 January 2003. However, the
NBI only prepared the report on 26 January 2004, and
referred it to the OSG only on 10 March 2004. Questions
regarding the responsible party and cause of such
protracted delay be it inadvertence or negligence need
not be belaboured here. Suffice it to state that it was
highly irregular for the OSG to present new evidence
before the courts only during certiorari proceedings,
thereby denying the private respondent his right to
contest the NBI's prejudical findings. The OSG is thus
cautioned to avoid such actuations in the future,
particularly where the Rules of Court expressly
provide for the appropriate venue for the presentation of
allegedly newly discovered evidence.
WHEREFORE, the Petition for Review
on Certiorari is DENIED. The Resolution of the Court
of Appeals dated 11 August 2004 in CA-G.R. SP No.
83787 dismissing outright the Petition for Certiorari,
and its Resolution dated 20 September
2004 denying the Motion for Reconsideration,
are AFFIRMED.
SO ORDERED.
ENGR. APOLINARIO DUEAS, G.R. No. 165679
Petitioner,
October 5, 2009
-versus -
ALICE GUCE-AFRICA,
Respondent.
x----------------------------------x
DECISION
DEL CASTILLO, J.:
Time and again, we have held that in a petition for
review on certiorari filed under Rule 45 of the Rules
of Court, we cannot review or pass upon factual
matters, save under exceptional circumstances,
none of which obtains in the present
case. Petitioner endeavors in vain to convince us
that the trial court and the Court of Appeals erred in
finding him negligent in the construction of
respondents house and holding him liable for
breach of contract.
This is a Petition for Review on Certiorari[1] under
Rule 45 of the Rules of Court seeking to reverse and
set aside the April 29, 2004 Decision[2] of the Court
Appeals in CA-G.R. CV No. 70757, which affirmed
the December 21, 2000 Decision[3] of the Regional
Trial Court, Branch 157, Pasig City, in an action for
breach of contract with damages[4] filed by
respondent against petitioner.
THE FACTS
For respondent and her family, April 18, 1998 was
supposed to be a special occasion and a time for
family reunion. It was the wedding date of her sister
Sally Guce, and respondents other siblings from
the United States of America, as well as her mother,
were expected to return to the country. The
wedding ceremony was set to be held at the familys
ancestral house at San Vicente, Banay-
banay, Lipa City, where respondents relatives
planned to stay while in the Philippines.
Respondent found the occasion an opportune time
to renovate their ancestral house. Thus, in January
1998 she entered into a Construction
Contract[5] with petitioner for the demolition of the
ancestral house and the construction of a new four-
bedroom residential house. The parties agreed that
respondent would pay P500,000.00 to the
petitioner, who obliged himself to furnish all the
necessary materials and labor for the completion of
the project. Petitioner likewise undertook to finish
all interior portions of the house on or before March
31, 1998, or more than two weeks before Sallys
wedding.
On April 18, 1998, however, the house remained
unfinished. The wedding ceremony was thus held at
the Club Victorina and respondents relatives were
forced to stay in a hotel.Her mother lived with her
children, transferring from one place to another.
On July 27, 1998, respondent filed a Complaint[6] for
breach of contract and damages against petitioner
before the Regional Trial Court of Pasig City. She
alleged, among others, that petitioner started the
project without securing the necessary permit from
the City Engineers Office of Lipa City. Respondent
likewise alleged that, all in all, she gave
petitioner P550,000.00 (which is P50,000.00 more
than the contract price). However, and despite
knowledge that the construction of the house was
intended for the forthcoming marriage of
respondents sister, petitioner unjustly and
fraudulently abandoned the project leaving it
substantially unfinished and incomplete. Several
demands were made, but petitioner obstinately
refused to make good his contractual obligations.
Worse, petitioners workmanship on the incomplete
residential house was substandard.
Respondent prayed for the return of the P50,000.00
overpayment. She also prayed for an award
of P100,000.00 for the purpose of repairing what
had been poorly constructed and at
least P200,000.00 to complete the project.
In his Answer with Counterclaim,[7] petitioner
asserted that it was respondent who undertook to
secure the necessary government permits.[8] With
regard to the alleged overpayment, petitioner
claimed that the amount of P50,000.00 was in
payment for the additional works which respondent
requested while the construction was still on
going. In fact, the estimated cost for the additional
works amounted to P133,960.00, over and above
the P500,000.00 contract price.
Petitioner likewise alleged that the delay in the
construction of the house was due to circumstances
beyond his control, namely: heavy rains, observance
of Holy Week, and celebration
of barangay fiesta. Ultimately, he was not able to
complete the project because on May 27, 1998,
respondent went to his house and told him to stop
the work.
He maintained that he cannot be held liable for the
amounts claimed by the
respondent in her complaint considering that he
had faithfully complied with the
terms and conditions of the Construction Contract.
On February 19, 1999, pre-trial conference was
conducted. Thereafter, trial ensued.
Respondent testified on the material points alleged
in her complaint. She also presented the testimony
of her brother Romeo Guce, who declared on the
witness stand that petitioner confided to him that
he had to stop the construction because he could no
longer pay his workers. He also testified that
petitioner asked for additional amount of
about P20,000.00 to finish the house. He relayed
this to the respondent who refused to release any
additional amount because of petitioners
unsatisfactory and substandard work. But later on,
respondent acceded and gave
petitioner P20,000.00.
To establish the status of the project and determine
the amount necessary for the repair and completion
of the house, respondent presented Romeo Dela
Cruz, a licensed realtor and a graduate of an
engineering course at the Technological Institute of
the Philippines. Dela Cruz testified that he
conducted an ocular inspection on the construction
site in November 1998 and found that only about
60% of the project had been accomplished. Some
parts of the project, according to the witness, were
even poorly done. He likewise testified that in order
to repair the poorly constructed portion of the
house, respondent would need to spend
about P100,000.00 and another P200,000.00 to
complete it.
Petitioner also took the witness stand and testified
on matters relative to the defenses he raised in his
answer.
On December 21, 2000, the RTC rendered a Decision
[9] in favor of the
respondent and against the petitioner. The RTC gave
more credence to respondents version of the facts,
finding that-
Clearly, Dueas [herein petitioner] failed to tender
performance in accordance with the terms and
conditions of the construction contract he executed
with Africa [herein respondent]. He failed to
construct a four-bedroom residential house suitable
and ready for occupancy on a stipulated date. Dueas
was fully aware that Africa needed the new house
for a long scheduled family event precisely a
completion date was included and specified in the
transaction. Despite knowledge and receipt of
payment from Africa, Dueas failed to deliver what
was incumbent upon him under the undertaking. He
unjustifiably incurred delay in the construction of
the new building and wrongfully deprived Africa and
her family of the use and enjoyment of the subject
property.Bad weather, observance of the Holy
Week and barangay fiesta are insufficient
excuses. As a building contractor Dueas should have
provided for such contingencies. Mere
inconvenience or unexpected impediments will not
relieve a party of his obligation. Granting that he
was not yet fully paid for the additional work
by Africa, provisions or arrangements should have
been made to ensure completion of the project
within the agreed period.
Moreover, Dueas negligently abandoned the
unfinished structure shortly after a confrontation
with Africa and family. Rain water sipped[sic] into
the house because Dueas failed to secure the
roofing and wall flushing. The house remained
[un]habitable because fixtures and devises were yet
to be installed. Dueas failed to exercise the required
diligence as a contractor and is guilty of negligence
and delay. He must be made responsible for the
foreseen effect of the exposure of the new structure
to the elements.
Significantly, the poor construction performance
manifested in the structure after Dueas in bad faith
abandoned it. Indeed, the newly constructed edifice
needs significant repairs if only to make it habitable
for its occupants.[10]
Consequently, the fallo of the RTC decision reads:
WHEREFORE, judgment is hereby rendered in favor
of plaintiff Alice G. Africa and against defendant
Apolinario Dueas who is hereby directed to pay
plaintiff:
- P100,000.00 for the necessary repair of the
structure;
- 200,000.00 for the completion of the
construction;
- 50,000.00 as and for attorneys fees;
- and costs of suit.
Plaintiffs claim for moral, nominal and exemplary
damages are hereby denied for lack of sufficient
basis.
SO ORDERED.[11]
Both parties were unsatisfied. They thus brought
the matter to the Court of Appeals assailing the
Decision of the RTC. The appellate court, however,
found no cogent reason to depart from the trial
courts conclusion. Thus, on April 29, 2004, it
rendered the herein assailed Decision[12] affirming
with modification the RTCs ruling, viz:
WHEREFORE, in view of the foregoing, the Decision
of the Regional Trial Court of Pasig City, Branch 157,
dated 21 December 2000, is hereby AFFIRMED
WITH MODIFICATION that the award of attorneys
fees is hereby DELETED.
SO ORDERED.[13]
ISSUES
Feeling aggrieved but still undeterred, petitioner
interposes the present recourse anchored on the
following grounds:
I.
THE COSTS OF ACTUAL DAMAGES AWARDED ARE
BASED ON MERE SPECULATIONS AND
CONJECTURES.[14]
II.
THE RULINGS THAT DUEAS ABANDONED THE WORK
AND INCURRED DELAY ARE CONTRARY TO THE
EVIDENCE.[15]
III.
THE DAMAGES CAUSED BY RAIN WATER WERE NOT
DUE TO APOLINARIO DUEAS FAULT OR
NEGLIGENCE.[16]
OUR RULING
For purposes of clarity, we shall tackle
simultaneously the second and third arguments
raised by the petitioner.
Instant petition not available to determine
whether petitioner violated the contract or
abandoned the construction of the house
Petitioner contends that he neither abandoned the
project nor violated the contract. He maintains that
continuous rains caused the delay in the
construction of the house and that he was not able
to finish the project because respondent ordered
him to stop the work. In fact, there was no reason
for him to stop the project because he still had
available workers and materials at that time, as well
as collectibles from the respondent. Petitioner
likewise contends that the Court of Appeals erred in
upholding the trial courts finding that he was guilty
of negligence.
The contentions lack merit.
Petitioner endeavors to convince us to determine,
yet again, the weight, credence, and probative value
of the evidence presented. This cannot be done in
this petition for review on certiorari under Rule 45
of the Rules of Court where only questions of law
may be raised by the parties and passed upon by
us. In Fong v. Velayo,[17] we defined a question of
law as distinguished from a question of fact, viz:
A question of law arises when there is doubt as to
what the law is on a certain state of facts, while
there is a question of fact when the doubt arises as
to the truth or falsity of the alleged facts.For a
question to be one of law, the same must not involve
an examination of the probative value of the
evidence presented by the litigants or any of
them. The resolution of the issue must rest solely on
what the law provides on the given set of
circumstances. Once it is clear that the issue invites
a review of the evidence presented, the questioned
posed is one of fact. Thus, the test of whether a
question is one of law or of fact is not the
appellation given to such question by the party
raising the same; rather, it is whether the appellate
court can determine the issue raised without
reviewing or evaluating the evidence, in which case,
it is a question of law; otherwise, it is a question of
fact.
It has already been held that the determination of
the existence of a breach of contract is a factual
matter not usually reviewable in a petition filed
under Rule 45.[18] We will not review, much less
reverse, the factual findings of the Court of Appeals
especially where, as in this case, such findings
coincide with those of the trial court, since we are
not a trier of facts.[19] The established rule is that
the factual findings of the Court of Appeals affirming
those of the RTC are conclusive and binding on
us. We are not wont to review them, save under
exceptional circumstances as: (1) when the
inference made is manifestly mistaken, absurd or
impossible; (2) when there is grave abuse of
discretion; (3) when the findings are grounded
entirely on speculations, surmises or conjectures; (4)
when the judgment of the Court of Appeals is based
on misapprehension of facts; (5) when the Court of
Appeals, in making its findings, went beyond the
issues of the case and the same is contrary to the
admissions of both appellant and appellee; (6) when
the findings of fact are conclusions without citation
of specific evidence on which they are based; (7)
when the Court of Appeals manifestly overlooked
certain relevant facts not disputed by the parties
and which, if properly considered, would justify a
different conclusion; and (8) when the findings of
fact of the Court of Appeals are premised on the
absence of evidence and are contradicted by the
evidence on record.[20]
Except with respect to the first ground advanced by
the petitioner which will be discussed later, none of
the above exceptions obtain in this case. Hence, we
find no cogent reason to disturb the findings of the
RTC and affirmed by the Court of Appeals that
petitioner was negligent in the construction of
respondents house and thus liable for breach of
contract.
Respondent not entitled to actual damages for
want of evidentiary proof
Petitioner further argues that the appellate court
erred in affirming the RTCs award of actual damages
for want of evidentiary foundation. He maintains
that actual damages must be proved with
reasonable degree of certainty. In the case at bench,
petitioner argues that the trial and the appellate
courts awarded the amounts of P100,000.00
and P200,000.00 as actual damages based merely
on the testimonies of respondent and her witness.
We agree. Article 2199 of the Civil Code provides
that one is entitled to an adequate compensation
only for such pecuniary loss suffered by him as he
has duly proved. In Ong v. Court of Appeals,[21] we
held that (a)ctual damages are such compensation
or damages for an injury that will put the injured
party in the position in which he had been before he
was injured. They pertain to such injuries or losses
that are actually sustained and susceptible of
measurement. To be recoverable, actual damages
must not only be capable of proof, but must actually
be proved with reasonable degree of certainty. We
cannot simply rely on speculation, conjecture or
guesswork in determining the amount of
damages. Thus, it was held that before actual
damages can be awarded, there must be competent
proof of the actual amount of loss, and credence
can be given only to claims which are duly
supported by receipts.[22]
Here, as correctly pointed out by petitioner,
respondent did not present documentary proof to
support the claimed necessary expenses for the
repair and completion of the house. In awarding the
amounts of P100,000.00 and P200,000.00, the RTC
and the Court of Appeals merely relied on the
testimonies of the respondent and her
witness. Thus:
As to the award of P100,000.00 as cost of repair
and P200,000.00 as the amount necessary to
complete the house, the Court finds the same to be
in the nature of actual damages. It is settled that
actual damages must be supported by best evidence
available x x x. In the case at bar, the Court finds
that the testimony of the plaintiff-appellant in this
regard is supported by the testimony of Romeo dela
Cruz, a realtor, who inspected the structure after it
remained unfinished. Said testimonies are sufficient
to establish the claim. x x x
temperate damages should be more than nominal
but less than compensatory. [24]
There is no doubt that respondent sustained
damages due to the breach committed by the
petitioner. The transfer of the venue of the
wedding, the repair of the substandard work, and
the completion of the house necessarily entailed
expenses. However, as earlier discussed,
respondent failed to present competent proof of
the exact amount of such pecuniary loss. To our
mind, and in view of the circumstances obtaining in
this case, an award of temperate damages
equivalent to 20% of the original contract price
of P500,000.00, or P100,000.00 (which, incidentally,
is equivalent to 1/3 of the total amount claimed as
actual damages), is just and reasonable.

Respondent entitled to temperate damages in lieu WHEREFORE, the instant petition

of actual damages
Nonetheless, in the absence of competent proof on
the amount of actual damages suffered, a party is
entitled to temperate damages. Articles 2216, 2224
and 2225 of the Civil Code provide:
is PARTIALLY GRANTED. The Decision of the Court
of Appeals dated April 29, 2004 in CA-G.R. CV No.
70757 is AFFIRMED withMODIFICATION that the
award of actual damages is deleted and, in lieu
thereof, petitioner is ordered to pay respondent
temperate damages in the amount of P100,000.00.

Art. 2216. No proof of pecuniary loss is necessary in SO ORDERED.

order that moral, nominal, temperate, liquidated or
exemplary damages may be adjudicated. The
assessment of such damages, except liquidated
ones, is left to the discretion of the court, according
to the circumstances of each case.

Art. 2224. Temperate or moderate damages, which

are more than nominal but less than compensatory
damages, may be recovered when the court finds
that some pecuniary loss has been suffered but its
amount can not, from the nature of the case, be
proved with certainty.

Art. 2225. Temperate damages must be reasonable

under the circumstances.

Temperate or moderate damages may be recovered

when some pecuniary loss has been suffered but its
amount cannot, from the nature of the case, be
proved with certainty.[23] The amount thereof is
usually left to the discretion of the courts but the
same should be reasonable, bearing in mind that
PEOPLE OF G.R. No. 176070
THE PHILIPPINES,
Appellee,
- versus -
ANTON MADEO,
Appellant. October 2, 2009
x------------------------------x
DECISION
DEL CASTILLO, J.:
Rape is nothing more or less than a conscious
process of intimidation by which a man keeps a
woman in a state of fear and humiliation. Thus, it is
not even impossible for a victim of rape not to make
an outcry against an unarmed assailant.[1] Physical
resistance is immaterial in a rape case when the
victim is sufficiently intimidated by her assailant and
she submits against her will because of fear for her
personal safety.[2]
Assailed before us is the 16 October 2006
Decision[3] of the Court of Appeals in CA-G.R. CR-
H.C. No. 01551 which affirmed the Decision[4] of
the Regional Trial Court ofUrdaneta City, Branch 46
in Criminal Case No. U-10600 finding appellant
Anton Madeo guilty beyond reasonable doubt of
the crime of rape and sentencing him to suffer the
penalty of reclusion perpetua and to pay the victim
the sum of P50,000.00 as moral damages
and P20,000.00 as exemplary damages, with
modification that appellant is further ordered to pay
the sum of P50,000.00 as civil indemnity.
On 4 April 2000, an Amended Information was filed
charging appellant Anton Madeo with the crime of
Rape committed as follows:
That on or about December 7, 1999, in the
afternoon, at Labit West, Urdaneta City and within
the jurisdiction of this Honorable Court, the above-
named accused, knowing fully well of the mental
disability, emotional disorder and/or physical
handicap of the offended party, AAA[5] at the time
of the commission of the rape, and by means of
force and intimidation, did then and there willfully,
unlawfully and feloniously have sexual intercourse
with said AAA, against her will and without her
consent, to her damage and prejudice.
Contrary to Art. 266-A, par. 1(a), Revised Penal
Code, as amended by Rep. Acts 7659 and 8353.[6]
During arraignment, appellant entered a plea of not
guilty.[7] Trial on the merits thereafter ensued.
The prosecution presented Dr. Noel U. Obedoza
who testified that he examined AAA on 5 January
2000. According to Dr. Obedoza, the victim was
conscious and coherent during the
[8]
interview. However, the physical examination
results indicated that she had a ruptured hymen and
healed hymenal lacerations[9] about three weeks
old.[10] On the other hand, Dr. Bernadette M.
Quitoriano testified that she conducted
psychological and mental examinations on the
person of AAA whom she found to have a mental
age of a 5 year old.[11]
AAA's mother also testified that on 5 January 2000,
she noticed that her daughter was pale and
trembling; that when asked if she has any problem,
AAA answered none;[12] that when further asked if
somebody touched her private parts, AAA cried and
told her that appellant touched her private parts
and warned her not to tell anyone or he would kill
her family;[13] that she and her husband immediately
brought AAA to a hospital for examination and to
the NBI to report the crime.[14]
Complaining witness, AAA, also took the witness
stand. She testified that on 7 December 1999 at
about 3 o'clock in the afternoon, she was on her
way to her grandmother's house when her
classmate, Jovelyn Fortuna (Jovelyn), invited her to
the house of her uncle, herein appellant
Madeo;[15] that soon thereafter Jovelyn left AAA
alone with appellant[16] who summoned AAA to his
room; that when she did not comply, appellant
forcibly pulled her inside the room,[17] undressed
her and thereafter touched her private parts;[18] that
appellant likewise undressed, ordered AAA to lie
down, went on top of her and proceeded to have
carnal knowledge of her;[19] that she felt pain in her
private parts;[20] that thereafter, appellant warned
AAA not to reveal to anyone what happened or he
would kill her and her family; that after the sexual
assault, appellant put on his pants; that AAA also
put on her shorts and was told to go home;[21] that
after some time she narrated the incident to her
mother who brought her to the hospital for medical
examination and to the NBI to report the
incident.[22]
The defense presented Jovelyn as its first
witness. She testified that she was staying at her
grandmother's house at Labit West, Urdaneta City,
Pangasinan;[23] that her uncle, appellant herein, also
stays in the said house;[24] that on 7 December
1999 she was sick[25] and did not see her uncle or
AAA.[26]
Melanie Andrada also testified for the defense. She
claimed that Jovelyn is her niece while appellant is
her cousin;[27] that on 7 December 1999, she visited
Jovelyn who was sick;[28] and that during her visit,
she did not see AAA or appellant.[29]
The defense also presented Olimpia Yesa who
testified that on 7 December 1999, from 3 to 7 p.m.,
she was at the house of Epifania Madeo, appellant's
mother, as she was treating Jovelyn who was sick.[30]
To establish the whereabouts of appellant, the
defense presented Virgilio Jacob who testified that
on 7 December 1999, he and appellant were
working in a mobile rice mill owned by Roger
Madolid at Labit West, Urdaneta City.[31]
Finally, the defense presented appellant who denied
the charges against him. He claimed that on 7
December 1999, he was working at the rolling rice
mill together with Berting Jacob, Etong, Rommel,
Roger Madolid who owned the rice mill and another
person whose name he forgot;[32] that from 6
o'clock in the morning up to 6 o'clock in the
afternoon, they traveled to several barangays in
Urdaneta City to mill rice; and that he did not see
the victim on said date.[33] On cross-examination,
appellant averred that he did not have any quarrel
with the victim and that he could not understand
why the latter would file the charges against him.[34]
On rebuttal, the prosecution presented Roger
Madolid who denied hiring Virgilio Jacob and
appellant as workers in his rolling rice mill. He
testified that on 7 December 1999, his rolling rice
mill was under repair at the Andrada Repair Shop in
Nancamaliran, Urdaneta City.[35]
On 24 August 2000,
the Regional Trial Court of Urdaneta City, Branch 46,
rendered its Decision, the dispositive portion of
which reads:
WHEREFORE, JUDGMENT is hereby rendered,
CONVICTING ANTON MADEO beyond reasonable
doubt of the crime of SIMPLE RAPE and the Court
sentences him to suffer the penalty of Reclusion
Perpetua; Anton Madeo is hereby ordered to
indemnify AAA the sum of P50,000.00 as moral
damages and P20,000.00 as exemplary damages.
The Branch Clerk of Court of this Court is hereby
ordered to prepare the mitimus immediately.
The Jail Warden, Bureau of Jail Management and
Penology (BJMP) Urdaneta District
Jail, Urdaneta City, is hereby ordered to deliver the
living person of Anton Madeo to the National Bilibid
Prisons, Muntinlupa City, immediately upon receipt
of this Decision.
SO ORDERED.[36]
The trial court held that although Dr. Quitoriano
testified that AAA has a mental age of 5 years old,
the latter is only simple-minded as she was able to
finish grade school and has a mental age of more
than seven years old. The court below found the
testimony of the victim credible and straightforward
and corroborated by the medical findings. Likewise,
the age of the healed hymenal lacerations coincided
with the date of the commission of the crime. On
the other hand, the court below disregarded
appellant's alibi for being self-serving.
Appellant filed an appeal before the Court of
Appeals. In his Brief,[37] he alleged that the trial
court erred in finding that he employed force and
intimidation in consummating the rape.[38] He also
argued that the victim's actuations did not show the
kind of resistance expected of a woman defending
her virtue. In particular, appellant asserted that AAA
voluntarily accepted the invitation to enter
appellant's room; that she did not make any outcry
or sought the help of the neighbors despite the lack
of danger to her life; that she was not rendered
unconscious during the intercourse; that she only
used her hands but not her feet in warding off
appellant's advances; and that the medical report
did not indicate that AAA suffered any physical
injury.[39]
Appellant likewise argued that the trial court erred
in finding that the victim was mentally
deficient.[40] He alleged that when AAA was
presented on the witness stand, she was 22 years
old and was in 2nd year high school.[41] Finally,
appellant alleged that the victim may have been
coerced by her mother to testify falsely against him
in order to have the sole management of the land
which she jointly tills with the appellant.[42]
In the Appellee's Brief,[43] the Office of the Solicitor
General countered that appellant's argument of
consensual congress should be dismissed because it
was clearly established that appellant employed
force, threats and intimidation. It was also shown
that AAA was deceived to join Jovelyn inside the
house of appellant; that the victim's failure to shout
could not yield the inference that no rape was
committed; and that the mental retardation of AAA
was proven beyond reasonable doubt.
On 16 October 2006, the Court of Appeals rendered
its Decision affirming with modification the Decision
of the Regional Trial Court, the dispositive portion of
which reads:
WHEREFORE, premises considered, the instant
appeal is hereby DISMISSED, and the Decision
appealed from rendered by
the Regional Trial Court of Urdaneta City, Branch 46,
dated August 24, 2000, in Criminal Case No. U-
10600 is hereby AFFIRMED with the
MODIFICATION that accused-appellant is
hereby ORDERED to pay private complainant an
additional Fifty Thousand Pesos (P50,000.00) as and
by way of civil indemnity.
SO ORDERED.[44]
The appellate court noted that the issues raised by
appellant deal with the victim's credibility and
appreciation of facts, both of which lie in the
province of the trial court. At any rate, the Court of
Appeals found that the trial court did not overlook
or mis-appreciate any material fact that warrants a
reversal of its findings.[45]
The appellate court likewise found that the victim
testified in a spontaneous and straightforward
manner; that there was nothing in her testimony
that detracts from her claim that she was indeed
raped; that her failure to make an outcry did not
mean that she was not raped; that the fact that she
did not shout could be attributed to the warning she
received from the appellant; that it is not true that
the victim did not resist the advances of the
appellant; and that AAA's failure to offer tenacious
resistance does not make her submission to the
criminal acts of the appellant voluntary.[46]
Anent the award of damages, the Court of Appeals
held that AAA is entitled to an additional amount
of P50,000.00 by way of indemnity ex delicto.[47]
On 7 March 2007, the Court resolved to notify the
parties to file, if they so desire, their respective
supplemental briefs.[48] Both parties manifested that
they were no longer submitting their supplemental
briefs since they have already extensively discussed
their arguments in their respective briefs.[49]
Article 266-A of the Revised Penal Code provides:
ART. 266-A. Rape, When and How Committed. -
Rape is committed -
1. By a man who shall have carnal knowledge of a
woman under any of the following circumstances:
a. Through force, threat or intimidation;
b. When the offended party is deprived of reason or
is otherwise unconscious;
c. By means of fraudulent machination or grave
abuse of authority;
d. When the offended party is under twelve (12)
years of age or is demented, even though none of
the circumstances mentioned above is present;
x x x x.
Thus, in the instant case, the prosecution must
prove beyond reasonable doubt that appellant had
carnal knowledge of AAA through the use of force,
threats or intimidation.
We have carefully examined the records of the case
and we find that both the trial court and the Court
of Appeals correctly held that appellant is guilty of
the crime of simple rape. The testimony of the
victim clearly established that appellant had sexual
intercourse with her without her consent and
against her will by employing force, threats and
intimidation. Her narration of her harrowing
experience is enlightening, thus:
Q On December 7, 1999 at 3:00 0clock in the
afternoon, do you remember where you were?
A Yes, sir.
Q Where were you?
A I was walking going to the house of my
grandmother, sir.
Q Were you able to reach the house of your
grandmother on that date and time?
A No, sir.
Q Why were you not able to reach the house of your
grandmother?
A That was the time when Anton Madeo raped me,
sir.
Q Will you kindly tell this Honorable Court how this
incident happened and started?
A I was walking going to the house of my
grandmother, Jovelyn called me, sir.
Q What is the family name of this Jovelyn?
A I only know her to be Jovelyn, sir.
COURT Is he a man or a woman?
A A woman, sir.
ATTY. BONGOLAN Do you know if this Jovelyn who
called you has any relationship with Anton Madeo?
A Yes, sir.
Q How are they related?
A Jovelyn is the niece of Anton Madeo, sir.
Q Where was Jovelyn when she called you?
A She was in the yard of Madeo, sir.
COURT So, you were walking and called by Jovelyn
in the yard of Madeo?
A Yes, sir.
ATTY. BONGOLAN What did she say when she called
you?
A Jovelyn told me, come AAA I have something to
tell you.
COURT Is that your nickname AAA?
A Yes, sir.
ATTY BOLONGAN What did you do?
A I responded to the call of Jovelyn, sir.
Q What happened when you got near Jovelyn?
A We greeted each other, sir.
Q What else?
A She invited me to get inside the house, sir.
Q Do you know where Anton Madeo was at the
time?
A Yes, sir.
Q Where was he?
A Inside their house, sir.
Q Did you go inside the house as invited by Jovelyn?
A Yes, sir.
Q When you got inside the house did you notice any
other person aside from the three of you?
A No more, sir.
COURT
By the way, the place where you were walking is it a
pathway, barrio road or municipal road?
A It is a road, sir.
Q The place where Jovelyn was at the time, was it
divided by a wall or barb wire or nothing was placed
in between the road?
A None, sir.
Q When you were already inside the house of Anton
Madeo and Jovelyn, what did Jovelyn do?
A She went out laughing, sir.
Q After she left what happened?
A (No answer yet, a question was raised by the
Court).
COURT Did you find out why she was laughing?
A Yes, sir.
Q What was the reason why she went out laughing?
A Because she told, come AAA inside the house.
Q Do you know the reason why she went out x x x
and why she went out laughing?
A Because Anton Madeo pulled me inside his room,
sir.
Q Did you comply?
A No, sir, I did not?
Q What is your understanding when Jovelyn went
out laughing?
A She was laughing, sir.
Q Is it because you were left alone with Anton
Madeo and she went out laughing?
A Yes, sir.
ATTY BOLONGAN Before Anton Madeo pulled you
to his room, what did he do then?
A He warned me and he said: if you shout I will kill
you.
COURT Where did he pull you?
A In his room, sir.
Q Otherwise what?
A He will kill me, sir.
ATTY BOLONGAN After he pulled you to his room
and warned if you will scream or shout what did he
do next if any?
A He suddenly undressed me, sir.
Q Will you tell us how he undressed you?
A He held my two hands and then he undressed me,
sir.
Q What part of your dress was removed first?
A My shorts, sir.
Q While he was removing your shorts what did you
do if you did anything?
A I was pushing him but he was heavy I cannot push
him away, sir.
Q After that what did he do if any?
A And then he removed my panty, sir.
Q What did he do to you when your panty was
being removed?
A He touched my vagina, sir.
COURT The touching of your vagina, is it actual
touching or inserting his penis or some other way?
A After touching my vagina he undressed himself,
sir.
ATTY. BOLONGAN After undressing himself what did
he do next if any?
A I was made to lie down and then he went on top
of me, sir.
Q When he went on top of you what did you do?
A I was struggling but I cannot push him because he
was heavy, sir.
Q When he was on top of you and you were trying
to free yourself struggling what happened next?
A He forced his organ to insert in my vagina, sir.
COURT When you said, he forced his organ in my
vagina what do you mean by his organ?
A His penis, sir.
COURT She is not a retarded.
ATTY BOLONGAN That is according to the findings of
the Doctor, Your Honor.
Q When he forcibly inserted his penis into your
private parts what did you feel?
A My vagina is painful, sir.
Q How long was he on top of you after inserting his
penis in your vagina?
A A little bit long, sir.
Q Can you estimate how long he was on top of you?
COURT If I were you I will not ask that question that
is dangerous.
ATTY BOLONGAN I will withdraw the question, Your
Honor.
ATTY BOLONGAN After that what happened?
A He said, if you will not give what I want, I will kill
you together with your father and mother.
Q I am asking what he did if any after he was
already on top of you and after he inserted his penis
into your organ?
A The penis was inserted in my vagina, sir.
Q After that what did he do?
A After that he warned me and he said, if you shout
I will kill you and your parents.
Q Did he finally get off from you?
A Yes, sir.
Q What did he do after he got off from you?
A He put on his pants, sir.
Q How about you?
A I also put on my shorts and stood up, sir.
Q When you stood up, did you notice something in
your person?
A Yes, sir.
Q What was that?
A My vagina was bleeding, sir.
Q Before that incident were you already touched by
a man?
A None except him, sir.
Q Did he tell you anything as you put on your dress?
A Yes, sir.
 A Yes, sir.
Q What did he tell you?
Q Who was with you when you were brought there?
A I was sent home, sir.
A My mother, sir.
Q Did he not tell you anything more?
Q What happened first in the hospital?
A If you report I will kill you and your father and
mother. A We were asked questions, sir.

Q But inspite of that threat did you report this Q When you said we who were your companions?
matter to anyone? A My mother, sir.

A Yes, sir. Q Do you know who interviewed you at the

hospital?
Q To whom did you report?
A I forgot the name, sir.
A My mother, sir.
Q After you were interviewed what happened next?
Q What did your mother do when you reported to
her? A I was submitted for examination to determine
pregnancy test, sir.
A My mother reported the same to my father, sir.
Q Do you remember having been examined by a
Q What did your parents do if they did anything? Doctor?

A I was examined at the Center, sir. A Yes, sir.

Q You are referring to the Rural Health Unit of Q Do you know the Doctor who examined you in the
Urdaneta City? hospital?

A Yes, sir. A I forgot the name, sir.

Q Were you brought to any hospital for further Q After you were examined in the hospital do you
examination? know if this matter was brought to the authorities?

A Yes, sir. A Yes, sir.

Q Where were you brought, what hospital? Q Where, what Police station or authorities?

A At the Center, sir. A At the NBI, sir.

Q Aside from the Center where were you brought?
A Emergency hospital, sir.
Q Are you referring to Don Amadeo Perez Memorial
General Hospital?
Q Where is that office of the NBI where you were
brought?
A Urdaneta City, sir.
Q What happened at the NBI Office?
A We were asked questions, sir.[50]
We find no merit in appellants contention that the
victims actuations did not show the kind of
resistance expected of a woman defending her
virtue. Time and again, we have held that the
behavior and reaction of every person cannot be
predicted with accuracy. It is a time-honored
precept that different people react differently to a
given situation or type of situation and there is no
standard form of behavioral response when one is
confronted with a strange or startling or frightful
experience. Not every rape victim can be expected
to act conformably to the usual expectations of
everyone. Some may shout; some may faint; and
some may be shocked into insensibility; while other
may openly welcome the intrusion.[51]
Besides, AAAs failure to cry for help during the
incident in question, did not make her testimony
improbable inasmuch as it is not uncommon for a
woman to be easily intimidated into silence and
conceal for sometime the violation of her honor,
even by the mildest threat to her life.[52] In her
testimony, AAA explained that she did not shout
because she was intimidated by the appellant, who
repeatedly warned that she and her family would be
killed if she would refuse to give in to his demands,
thus:
Q Why did you not tell your mother immediately on
that date, December 7, 1999, when you arrived
home from the place where you were allegedly
raped?
A I did not report immediately because I was afraid
because Anton threatened me.[53]
xxxx
Q Since you did not like to be alone with Madeo,
why did you allow Jovelyn to leave without you?
A She just left.
Q Why did you not follow her since you were alone
in a house with another man?
A Because Madeo threatened me if I shout he will
kill my father and mother.
Q That is correct when Jovelyn left, but before
Jovelyn left, why did you not follow her
immediately?
A I was scared that is why I was not able to follow.
xxxx
Q Since you were already scared and afraid, why did
you not leave the house when Jovelyn was still
there?
A I was threatened, sir.[54]
xxxx
Q On questions of this Honorable Court, you
testified that your mouth was not covered, you
were conscious all through out that process did you
shout or scream for help?
A No, sir.
Q Why not?
A Because I was threatened.[55]
Our ruling in People v. Silvano[56] is instructive, to
wit:
For his defense, appellant claims among others, that
the victim offered only a token resistance when the
alleged sexual acts were being done. Be that as it
may, the failure to shout or offer tenacious
resistance cannot be construed as a voluntary
submission to appellants desires. It is enough if the
prosecution had proven that force or intimidation
concurred in the commission of the crime, as in this
case. The law does not impose upon a rape victim
the burden of proving resistance. Moreover,
physical resistance need not be established in rape
when intimidation is exercised upon the victim and
she submits herself against her will to the rapists
lust because of fear for her life or personal
safety. The force, violence, or intimidation in rape is
a relative term, depending not only on the age, size,
and strength of the parties but also on their Q Who are your parents?
relationship with each other.
A BBB and CCC, sir.
The imputation that AAA was coerced by her
mother to file the charges against appellant in order Q What does your father do for a living?
to have exclusive rights to the land they presently
jointly cultivate, is unbelievable. It is outrageous A He is a farmer, sir.
even to suggest that a mother would subject her
daughter to a public trial, ridicule and Q About your mother?
embarrassment and to all the rigors that go with it,
just for the purpose of increasing ones A Housekeeper, sir
harvest. Besides, this imputation is totally lacking in
any factual basis. From AAAs and her mothers Q Do you wear bra?
testimony, we could only discern an honest and
sincere desire to solely seek justice and obtain A No, sir.
redress for the unforgivable and wicked acts
committed upon her. Q Do you understand bra?
A Yes, sir.
Anent AAAs state of mind, we find that we cannot
subscribe to the findings that AAAs mental age is Q You dont have any bra?
that of a 5 years old, or even a seven year-old. The
basic postulate in criminal prosecution anchored on A I have, sir.
the constitution is that the prosecution is burdened
to prove the guilt of the accused for the crime Q Do you have panty?
charged beyond cavil of doubt. The prosecution is A Yes, sir.
burdened to prove conclusively and indubitably not
only that appellant had carnal knowledge of AAA Q Do you go to school?
but also that she was a mental retardate.[57] The
conviction of an accused of rape based on the A Yes, sir.
mental retardation of AAA must be anchored on
proof beyond reasonable doubt of her mental Q What grade?
retardation.[58] We examined closely the testimony
of AAA and we find the same to be coherent and A Second year high school, sir.
categorical. In assessing her level of intelligence and
capacity to comprehend, the trial court propounded Q What school?
several questions which were all satisfactorily
answered by AAA, thus: A Catablan, sir.

Q Do you recognize the people around the bench,
do you know them?
A Not yet, sir.
Q You dont know their names, can you tell us their
occupation or calling are they Doctors, Police or
what?
Q What municipality is Catablan?
A Urdaneta, sir.
Q What are your subjects in second year high
school?
A English, Pilipino, Hekasi, sir.

A Lawyers, sir. Q What is your favorite subject aside from recess?

A Pilipino, sir. In addition, we find that although it was specifically
alleged in the Information that appellant knew of
Q Do you know who is your teacher in Pilipino? AAAs mental disability, emotional disorder and/or
physical handicap, still, no proof was presented that
A Mercedita, sir. appellant indeed knew AAAs alleged mental
deficiency. In People v. Limio,[61] we held that:
Q You comb your hair personally or with the
assistance of your mother? By itself, the fact that the offended party in a rape
case is a mental retardate does not call for an
A Me, sir. imposition of the death penalty, unless knowledge
by the offender of such mental disability is
Q Do you take a bath alone? specifically alleged and adequately proved by the
prosecution.
A Yes, sir.
For the Anti-Rape Law of 1997, now embodied in
Q Without the assistance of your mother? Article 266-B of the Revised Penal Code (RPC),
expressly provides that the death penalty shall also
A Yes, sir. be imposed if the crime of rape is committed with
the qualifying circumstance of (10) when
Q Do you dress up alone? the offender knew of the mental disability,
emotional disorder and/or physical handicap of the
A Yes, sir. offended party at the time of the commission of the
crime. Said knowledge, in our view, qualifies rape as
Q Do you put your bra alone? a heinous offense. Absent said circumstance, which
must be proved by the prosecution beyond
A Yes, sir. reasonable doubt, the conviction of appellant for
qualified rape under Art. 266-B (10), RPC, could not
Q Do you put your panty alone? be sustained, although the offender may be held
liable for simple rape and sentenced to reclusion
A Yes, sir. perpetua.
Q About your shoes?

A Yes, sir. Both the trial court and the Court of Appeals
correctly disregarded appellants denial and
Q Do you use shampoo in your hair? alibi. These two defenses are inherently the weakest
as they are negative defenses.Mere denials of
A Yes, sir. involvement in a crime cannot take precedence over
the positive testimony of the offended party. For
Q Do you use soap? alibi to prosper, it is not enough for the defendant
to prove that he was somewhere else when the
A Yes, sir. crime was committed; he must likewise
demonstrate that it is physically impossible for him
Q What kind of soap? to be at the scene of the crime at the time.[62]

A Safeguard, sir.[59] In the instant case, AAA positively identified

appellant as the author of the crime. It should be
Based on the testimony of AAA, we are convinced noted that affirmative testimony, like that of the
that she is not a mental retardate.[60] victims, is stronger than appellants bare denial,
which is a negative assertion. As regards appellants
alibi, we find that he failed to prove that it was
physically impossible for him to be at the scene of
the crime at the time it was committed.

In view of the foregoing, we find that appellant was

correctly found guilty of the crime of simple
rape; i.e., by having carnal knowledge of a woman
committed through the use of force, threats or
intimidation. Under Article 266-B of the Revised
Penal Code, the penalty therefor is reclusion
perpetua.

Anent the award of damages, we find that the

award of P50,000.00 as civil indemnity and
another P50,000.00 as moral damages is proper and
in line with prevailing jurisprudence.[63] Civil
indemnity is mandatory upon a finding of the fact of
rape. As to moral damages, the same is
automatically granted without need of further
proof, it being assumed that a rape victim has
actually suffered moral damages entitling her to
such award. However, the award of exemplary
damages must be deleted. Article 2230 of the Civil
Code provides that in criminal offenses, exemplary
damages as a part of civil liability may be imposed
when the crime was committed with one or more
aggravating circumstances. There being no
aggravating circumstance in the instant case, the
award of exemplary damages therefore has no
basis. In People v. Marcos,[64] we held that the
award of exemplary damages is in order when the
crime was committed with an aggravating
circumstance pursuant to Article 2230 of the Civil
Code.

WHEREFORE, the 16 October 2006 Decision of the

Court of Appeals in CA-G.R. CR-H.C. No. 01551
finding appellant Anton Madeo guilty beyond
reasonable doubt of the crime of rape and
sentencing him to suffer the penalty of reclusion
perpetua and to pay the victim the sum
of P50,000.00 as moral damages, and P50,000.00 as
civil indemnity, is AFFIRMED with
MODIFICATION that the award of P20,000.00 as
exemplary damages is DELETED.

SO ORDERED.
ARNEL SAGANA, G.R. No.161952 Civil Case No. Q-94-22445 and held that there was
Petitioner, no valid service of summons to respondent Richard
Present: A. Francisco.

YNARES- On 13 December 1994, petitioner Arnel Sagana filed

SANTIAGO,* J. a Complaint[4] for Damages before the Regional Trial
CARPIO MORALES, Court of Quezon City docketed as Civil Case No. Q-
- versus - Acting Chairperson, 94-22445 and raffled to Branch 99. Petitioner
BRION, alleged that on 20 November 1992, respondent
DEL CASTILLO, and Richard A. Francisco, with intent to kill and without
ABAD, JJ. justifiable reason, shot him with a gun hitting him
on the right thigh. As a result, petitioner incurred
RICHARD A. Promulgated: medical expenses and suffered wounded feelings,
FRANCISCO, and was compelled to engage the services of a
Respondent, ** October 2, 2009 lawyer, due to respondents refusal to pay said
x--------------------------------------- expenses. Petitioner thus demanded payment
--------------------x of P300,000.00 as actual damages, P150,000.00 as
moral damages, P50,000.00, exemplary damages,
and P50,000.00 as attorneys fees.
DECISION
On 31 January 1995, process server Manuel S.
DEL CASTILLO, J.: Panlasigui attempted to serve summons at
respondents address at No. 36 Sampaguita St.,
Baesa, Quezon City but was unsuccessful. In his
It is, at times, difficult to reconcile the letter of the Servers Return,[5] Panlasigui stated that he tried to
law with its spirit. Thus, it is not altogether personally serve the summons to respondent at his
surprising that two competing values are usually given address at No. 36 Sampaguita St.,
discernable in every controversy the principle Baesa, Quezon City. However, the occupant of that
of dura lex sed lex versus the notion that house, who refused to give his identity, told him
technicalities should yield to broader interests of that respondent is unknown at said
justice. In our rules of procedure, for instance, address. Panlasigui also declared that diligent
judges often struggle to find a balance between due efforts were exerted to serve the summons but
process considerations and a liberal construction to these proved to be futile.[6] Subsequently, the trial
secure a just disposition of every action. In such court attempted to serve summons to respondents
cases, where a measure of discretion is permitted, office through registered mail on 9 February
courts must tread carefully, with due consideration 1995. However, despite three notices, respondent
of the factual milieu and legal principles involved. In failed to pick up the summons.
so doing, we take steps - sometimes tentative,
sometimes bold - to apply prior experience and On 30 June 1995, the trial court dismissed the case
precedent towards an eventual just resolution. It is on account of petitioners lack of interest to
these principles that animate our decision in the prosecute.[7] It noted that since the filing of the
instant case. Servers Return on 8 February 1995, petitioner did
not take any action thus indicating lack of interest to
Assailed in this Petition for Review prosecute the case.
[1]
on Certiorari under Rule 45 of the Rules of Court is
the 13 August 2003 Decision[2] of the Court of Petitioner filed a Motion for
Appeals in CA-G.R. CV No. 66412 which reversed [8]
Reconsideration stating that after the Servers
and set aside the 20 September 1999 Decision[3] of Return was filed, he exerted efforts to locate the
the Regional Trial Court of Quezon City, Branch 99 in respondent, and it was confirmed that respondent
indeed lived at No. 36 Sampaguita St.,
Baesa, Quezon City. On 4 August 1995, the trial
court granted petitioners motion for
reconsideration, conditioned upon the service of
summons on the respondent within 10 days from
receipt of the Order.[9]
Thus, on 25 August 1995, Process Server Jarvis
Iconar again tried to serve the summons at the
address of the respondent but no avail. According to
Iconars handwritten notation on the
[10]
summons, he was informed by Michael Francisco,
respondents brother, that respondent no longer
lived at said address. However, he left a copy of the
summons to Michael Francisco.[11]
On 10 November 1995, petitioner filed a Motion to
Declare Defendant in Default,[12] alleging that
despite service of summons, respondent still failed
to file an Answer. On 16 February 1996, the trial
court issued an Order[13] finding that the summons
was validly served to respondent through his
brother, Michael. It thus declared respondent in
default and allowed petitioner to present his
evidence ex parte. Nonetheless, copies of all
pleadings and court documents were furnished to
respondent at No. 36 Sampaguita St.
In the meantime, on 1 March 1996, Michael
Francisco, through his counsel, Atty. Bernardo Q.
Cuaresma, filed a Manifestation and
[14]
Motion denying that he received the summons or
that he was authorized to receive summons on
behalf of his brother, respondent Richard
Francisco. He alleged that the substituted service
did not comply with Section 8, Rule 14 of the Rules
of Court, since summons was not served at
defendants residence or left with any person who
was authorized to receive it on behalf of the
defendant. Michael Francisco also prayed that his
name be stricken off the records as having received
a copy of the summons.
In the Affidavit of Merit[15] submitted together with
the Manifestation and Motion, Michael Francisco
asserted that he was 19 years of age; that his
brother, herein respondent Richard Francisco, had
left their residence in March 1993; and that
respondent would just write his family without
informing them of his address, or would just call by
phone.
Thereafter, petitioner and movant Michael
Francisco submitted their respective Opposition,
Reply, and Rejoinder. In his Rejoinder, petitioner
attached a copy of an Affidavit[16]prepared by
respondent Richard A. Francisco dated 23 December
1992, where he declared himself a resident of No.
36 Sampaguita St. Interestingly, the lawyer who
notarized the affidavit for the respondent, Atty.
Bernardo Q. Cuaresma, was the same lawyer who
represented respondents brother before the trial
court.
On 4 October 1996, the trial court issued an
Order[17] denying Michael Franciscos Manifestation
and Motion for lack of merit, holding thus:
It should be considered that earlier, plaintiff had
already sent numerous pleadings to defendant at
his last known address. As also pointed out by
[petitioner] in his Opposition, movant has not
adduced evidence, except his affidavit of merit, to
impugn the service of summons thru him. Movant
herein also admits that defendant communicates
with him through telephone. Movant, therefore,
being a person of sufficient age and discretion,
would be able, more likely than not, to inform
defendant of the fact that summons was sent to him
by the court.[18]
Having failed to file an answer or any responsive
pleading, respondent was declared in default and
petitioner was allowed to present evidence ex
parte. On 20 September 1999, the trial court
rendered its Decision,[19] the dispositive portion of
which reads:
WHEREFORE, premises considered, judgment is
hereby rendered in favor of plaintiff and hereby
orders defendant to pay plaintiff the amount of
THIRTY FIVE THOUSAND PESOS (PhP35,000.00) as
and for actual damages, the amount of FIFTEEN
THOUSAND PESOS (PhP15,000.00) as and for moral
damages, the amount of TEN THOUSAND PESOS
(PhP10,000.00) for exemplary damages and the
amount of TWENTY THOUSAND PESOS
(PhP20,000.00) as attorneys fees.
No further costs.
SO ORDERED.[20]
On 23 November 1999, respondent Richard A.
Francisco filed a Notice of Appeal, claiming that he
received a copy of the trial courts Decision on 9
November 1999; that the same was contrary to the
law, facts, and evidence, and praying that his appeal
be given due course.[21]
On 5 June 2000, the Court of Appeals directed the
parties to file their respective briefs, a copy of which
was sent to respondent by registered mail at No. 36
Sampaguita St., Baesa, Quezon City.[22] In his
Appellants brief, respondent argued that:
I acquire jurisdiction over the person of the
THE COURT A QUO ERRED IN ASSUMING
JURISDICTION OVER THE PERSON OF THE
DEFENDANT-APPELLANT DESPITE THE
IRREGULARITY OF THE SUBSTITUTED SERVICE OF
SUMMONS BY THE COURT PROCESS SERVER.
II
THE COURT A QUO ERRED IN AWARDING ACTUAL
DAMAGES IN THE AMOUNT OF THIRTY FIVE-
THOUSAND PESOS (P35,000.00) TO THE PLAINTIFF-
APPELLEE ALTHOUGH ONLY SEVENTEEN THOUSAND
PESOS (P17,000.00) WAS DULY SUPPORTED BY
RECEIPTS.
III
THE COURT A QUO LIKEWISE ERRED IN AWARDING
UNREASONABLE MORAL DAMAGES IN THE
AMOUNT OF FIFTEEN THOUSAND PESOS
(P15,000.00); EXEMPLARY DAMAGES IN THE
AMOUNT OF TEN THOUSAND PESOS (P10,000.00);
AND ATTORNEYS FEES IN THE AMOUNT OF TWENTY
THOUSAND PESOS (P20,000.00) DESPITE THE FACT
THAT THERE IS NO FACTUAL AND SUBSTANTIVE
BASIS FOR ALL THESE.[23]
On 15 August 2002, the Court of Appeals issued a
Resolution[24] ordering the parties to personally
appear for the conduct of preliminary conference to
consider amicably settling the appeal, pursuant to
Sec. 1(a), Rule 7 of the Revised Internal Rules of the
Court of Appeals and the Courts Resolution A.M.
No. 02-2-17-SC dated 16 April 2002 regarding the
Pilot Testing of Mediation in the Court of
Appeals. Respondent was furnished[25] a copy of this
Resolution at his address at No. 36 Sampaguita
Street, Baesa, Quezon City. Per Delivery Receipt of
the Court of Appeals, the same was personally
received by respondent on 23 August 2002.[26]
On 3 September 2002, respondent attended the
preliminary conference; however the parties failed
to reach an amicable settlement.[27] Thus, on 13
August 2003, the Court of Appeals rendered the
herein assailed Decision granting the appeal and
setting aside the Decision of the trial court. The
appellate court held that the service of summons
was irregular and such irregularity nullified the
proceedings before the trial court. Since it did not
respondent, the trial courts decision was void.
In brief, the Court of Appeals found that there was
no valid service of summons for the following
reasons:
1. Except for the notation made by the process
server on the summons, no proof of service by way
of a Process Servers Return was prepared;
2. The process server failed to state the specific
facts and circumstances that would justify valid
substituted service of summons, to wit: (a) the
impossibility of service of summons within a
reasonable time, (b) the efforts exerted to locate
the respondent, and (c) it was served on a person of
sufficient age and discretion residing therein.
3. Petitioner failed to prove that, at the time
summons was served, respondent actually lived
in No. 36 Sampaguita St.
Petitioner filed a Motion for
[28]
Reconsideration where he alleged that
respondent did, in fact, reside at No. 36 Sampaguita
St. To prove this assertion, petitioner submitted the
original copy of the envelope containing
respondents Notice of Appeal, which indicated
respondents return address to be No. 36
Sampaguita St.[29] Nonetheless, on 29 January 2004,
the Court of Appeals denied the Motion for
Reconsideration.
Hence, petitioner filed this Petition for Review
on Certiorari under Rule 45 of the Rules of Court,
raising the sole issue of whether there was valid
service of summons upon the respondent.
The petition is meritorious. Under the
circumstances obtaining in this case, we find there
was proper substituted service of summons upon
the respondent.
Section 8 of Rule 14 of the old Revised Rules of
Court, the rules of procedure then in force at the
time summons was served, provided:
Section 8. Substituted service. If the defendant
cannot be served within a reasonable time as
provided in the preceding section [personal service
on defendant], service may be effected (a) by
leaving copies of the summons at the defendants
residence with some person of suitable age and
discretion then residing therein, or (b) by leaving
the copies at defendants office or regular place of
business with some competent person in charge
thereof.
Jurisprudence has long established that for
substituted service of summons to be valid, the
following must be demonstrated: (a) that personal
service of summons within a reasonable time was
impossible; (b) that efforts were exerted to locate
the party; and (c) that the summons was served
upon a person of sufficient age and discretion
residing at the party's residence or upon a
competent person in charge of the party's office or
regular place of business.[30] It is likewise required
that the pertinent facts proving these circumstances
be stated in the proof of service or in the officer's
return.[31]
In this case, personal service of summons was twice
attempted by the trial court, although
unsuccessfully. In the first attempt, the resident of
the house refused to receive the summons; worse,
he would not even give his name. In the second
attempt, respondents own brother refused to sign
for receipt of the summons, and then later claimed
that he never received a copy, despite his
participation in the proceedings. The trial court also
thrice attempted to contact the respondent through
his place of work, but to no avail. These diligent
efforts to locate the respondent were noted in the
first sheriff's return, the process server's notation,
as well as the records of the case.
Clearly, personal service of summons was made
impossible by the acts of the respondent in refusing
to reveal his whereabouts, and by the act of his
brother in claiming that respondent no longer lived
at No. 36 Sampaguita St., yet failing to disclose his
brother's location. We also note that it was the trial
court which directed that the second service of
summons be made within seven days; thus, the
reasonable time was prescribed by the trial court
itself.
Undeniably, no Sheriffs Return was prepared by
process server Jarvis Iconar; the only record of the
second service of summons was Mr. Iconars
handwritten notation in the summons
itself. However, the information required by law and
prevailing jurisprudence, that is, that personal
service was impossible because of the claim that
respondent no longer lived at the stated address,
that efforts were exerted to locate the respondent
through the multiple attempts to serve summons,
and that summons was served upon a person of
sufficient age and discretion, were already in the
records of the trial court.
Moreover, we find the claim that respondent moved
out of their residence in March 1993 without
informing his brother or parents his whereabouts,
despite regular calls and letters, simply incredulous.
What makes this version of events even more
implausible is respondents admission that he
received a copy of the trial court's Decision of 20
September 1999 that was sent to No. 36
Sampaguita Street. Respondent even filed a Notice
of Appeal coincidentally indicating that his address
was No. 36 Sampaguita St., Baesa, Quezon City. He
also received a copy of the appellate courts order
for preliminary conference that was sent to said
address. These were never denied by respondent,
despite being given every opportunity to do so.
Respondent also wishes us to believe that it was to disclose his true address, it was impossible to
pure chance that he and his brother were assisted personally serve summons upon him. Considering
by the same lawyer, Atty. Bernardo Q. Cuaresma, that respondent could not have received summons
and yet it never occurred to respondents own because of his own pretenses, and has failed to
brother or lawyer to inform him about the receipt of provide an explanation of his purported new
summons. All these militate against respondents residence, he must now bear the consequences.[34]
self-serving declaration that he did not reside at No.
36 Sampaguita St. Indeed, there was no proof WHEREFORE, the Petition for Review
presented as to when respondent left and then on Certiorari is GRANTED. The 13 August
returned to his original home, if he actually did 2003 Decision of the Court of Appeals in CA-G.R. CV
leave his home. No. 66412 and its 29 January 2004 Resolution
are REVERSED and SET ASIDE. The Decision of the
In view of the foregoing, we find that substituted Regional Trial Court of Quezon City, Branch 99,
service of summons was validly made upon dated 20 September 1999 in Civil Case No. Q-94-
respondent through his brother. 22445 holding that there was valid service of
We do not intend this ruling to overturn summons, and ordering respondent to pay
jurisprudence to the effect that statutory petitioner the amounts of P35,000.00 as actual
requirements of substituted service must be damages, P15,000.00 as moral damages, P10,000.00
followed strictly, faithfully, and fully, and that any as exemplary damages, and P20,000.00 as attorneys
substituted service other than that authorized by fees, is REINSTATED and AFFIRMED.
the Rules is considered ineffective.[32] However, an
overly strict application of the Rules is not SO ORDERED.
warranted in this case, as it would clearly frustrate
the spirit of the law as well as do injustice to the
parties, who have been waiting for almost 15 years
for a resolution of this case. We are not heedless of
the widespread and flagrant practice whereby
defendants actively attempt to frustrate the proper
service of summons by refusing to give their names,
rebuffing requests to sign for or receive documents,
or eluding officers of the court. Of course it is to be
expected that defendants try to avoid service of
summons, prompting this Court to declare that, the
sheriff must be resourceful, persevering, canny, and
diligent in serving the process on the
defendant.[33] However, sheriffs are not expected to
be sleuths, and cannot be faulted where the
defendants themselves engage in deception to
thwart the orderly administration of justice.

The purpose of summons is two-fold: to acquire

jurisdiction over the person of the defendant and to
notify the defendant that an action has been
commenced so that he may be given an opportunity
to be heard on the claim against him. Under the
circumstances of this case, we find that respondent
was duly apprised of the action against him and had
every opportunity to answer the charges made by
the petitioner. However, since respondent refused
SPS. ISAGANI CASTRO and G.R. No. 168940 Respondent Angelina de Leon Tan, and her husband
DIOSDADA CASTRO, Ruben Tan were the former registered owners of a 240-
Petitioners, Present: square meter residential lot, situated at Barrio Canalate,
Malolos, Bulacan and covered by Transfer Certificate of
- versus - CARPIO,* J., Title No. T-8540. On February 17, 1994, they entered into
Chairperson, an agreement with petitioners spouses Isagani and
ANGELINA DE LEON TAN, LEONARDO-DE Diosdada Castro denominated as Kasulatan ng Sanglaan
CASTRO,** ng Lupa at Bahay (Kasulatan) to secure a loan
SPS. CONCEPCION T. BRION, of P30,000.00 they obtained from the latter. Under
CLEMENTE the Kasulatan, the spouses Tan undertook to pay the
and ALEXANDER C. DEL CASTILLO, and mortgage debt within six months or until August 17, 1994,
CLEMENTE, with an interest rate of 5% per month, compounded
SPS. ELIZABETH T. CARPIO ABAD, JJ. monthly.
and When her husband died on September 2, 1994,
ALVIN CARPIO, SPS. respondent Tan was left with the responsibility of paying
MARIE ROSE the loan. However, she failed to pay the same upon
T. SOLIMAN and ARVIN Promulgated: maturity. Thereafter, she offered to pay petitioners the
SOLIMAN principal amount of P30,000.00 plus a portion of the
and JULIUS AMIEL TAN, November 24, 2009 interest but petitioners refused and instead demanded
Respondents. payment of the total accumulated sum of P359,000.00.
x---------------------- -------------------x
DECISION On February 5, 1999, petitioners caused the extrajudicial
foreclosure of the real estate mortgage and emerged as
DEL CASTILLO, J.: the only bidder in the auction sale that ensued. The period
of redemption expired without respondent Tan having
The imposition of an unconscionable rate of interest on a redeemed the property; thus title over the same was
money debt, even if knowingly and voluntarily assumed, is consolidated in favor of petitioners. After a writ of
immoral and unjust. It is tantamount to a repugnant possession was issued, the Sheriff ejected respondents
spoliation and an iniquitous deprivation of property, from the property and delivered the possession thereof to
repulsive to the common sense of man. It has no support petitioners.
in law, in principles of justice, or in the human conscience
nor is there any reason whatsoever which may justify such Proceedings before the Regional Trial Court
imposition as righteous and as one that may be sustained
within the sphere of public or private morals.[1] On September 26, 2000, respondent Tan, joined by
respondents Sps. Concepcion T. Clemente and Alexander
In this Petition for Review on Certiorari,[2] petitioners C. Clemente, Sps. Elizabeth T. Carpio and Alvin Carpio, Sps.
assail the October 29, 2004 Decision[3] and July 18, 2005 Marie Rose T. Soliman and Arvin Soliman and Julius Amiel
Resolution[4] of the Court of Appeals (CA) in CA-G.R. CV Tan filed a Complaint for Nullification of Mortgage and
No. 76842, affirming the June 11, 2002 Decision[5] of the Foreclosure and/or Partial Rescission of Documents and
Regional Trial Court of Bulacan, Branch 79, which Damages[6] before the Regional Trial Court of Malolos,
equitably reduced the stipulated interest rate in an Bulacan. They alleged, inter alia, that the interest rate
agreement entered into by the parties from 60% per imposed on the principal amount of P30,000.00 is
annum (or 5% per month) to 12% per annum, with the unconscionable.[7]
modification that herein respondents may redeem the
mortgaged property notwithstanding the lapse of On June 11, 2002, the trial court rendered judgment in
redemption period on grounds of equity and substantial favor of respondents, viz:
justice.
Factual antecedents
PREMISES CONSIDERED, this Court cannot declare the
mortgage and foreclosure null and void but the x x
x Kasulatan ng Sanglaan ng Lupa x x x herebelow quoted:
2. Na ang nasabing pagkakautang ay aming babayaran
sa loob ng anim (6) na buwan simula sa petsa ng
kasulatang ito o dili kaya ay sa bago dumating ang Agosto
17, 1994 na may pakinabang na 5% bawat buwan.Na ang
tubo ay aani pa rin ng tubong 5% bawat buwan.
Is partially rescinded to only 12% interest per annum and
additional one percent a month penalty charges as
liquidated damages beginning February 17, 1994 up to
June 21, 2000 per Delivery of Possession x x x and/or for
the defendants to accept the offer of P200,000.00 by the
plaintiffs to redeem or reacquire the property in litis.
The Court is not inclined to award moral damages since
plaintiffs failed to buttress her claim of moral damages
and/or proof of moral damages. x x x
No award of attorneys fees because the general rule is
that no [premium] should be placed on the right to
litigate. x x x
The counterclaim of the defendants is hereby DISMISSED
for lack of merit.
Costs against the defendants.
SO ORDERED.[8]
Proceedings before the Court of Appeals
Petitioners appealed to the Court of Appeals which
affirmed the trial courts finding that the interest rate
stipulated in the Kasulatan is iniquitous or unconscionable
and, thus, its equitable reduction to the legal rate of 12%
per annum is warranted.[9] At the same time, the
appellate court declared that respondents may redeem
the mortgaged property notwithstanding the expiration
of the period of redemption, in the interest of substantial
justice and equity.[10] The dispositive portion of said
Decision reads:
WHEREFORE, the appealed judgment is hereby
AFFIRMED with the MODIFICATION that plaintiffs-
appellees may redeem the mortgaged property by paying
the defendants-appellants spouses Isagani and Diosdada
Castro the amount of P30,000.00, with interest thereon at
12% per annum from February 17, 1994 until fully paid
plus penalty charges at the same rate from February 17,
1994 to June 21, 2000.
SO ORDERED.[11]
Petitioners Motion for Reconsideration was denied by the
Court of Appeals in a Resolution dated July 18, 2005.
Issues
Hence, the present Petition for Review
on Certiorari raising the following issues:
1. THE COURT OF APPEALS GROSSLY ERRED IN
NULLIFYING THE INTEREST RATE VOLUNTARILY AGREED
UPON BY THE PETITIONERS AND RESPONDENTS AND
EXPRESSLY STIPULATED IN THE CONTRACT OF
MORTGAGE ENTERED INTO BETWEEN THEM.
2. THE COURT OF APPEALS GROSSLY ERRED IN MAKING A
CONTRACT BETWEEN THE PETITIONERS AND
RESPONDENTS BY UNILATERALLY CHANGING THE TERMS
AND CONDITIONS OF THE CONTRACT OF MORTGAGE
ENTERED INTO BETWEEN THEM.
3. THE COURT OF APPEALS GROSSLY ERRED IN
EXTENDING THE PERIOD OF REDEMPTION IN FAVOR OF
THE RESPONDENTS IN VIOLATION OF THE CLEAR AND
UNEQUIVOCAL PROVISIONS OF ACT NO. 3135
PROVIDING A PERIOD OF ONLY ONE YEAR FOR THE
REDEMPTION OF A FORECLOSED REAL PROPERTY.[12]
Petitioners Arguments
Petitioners contend that with the removal by the Bangko
Sentral of the ceiling on the rate of interest that may be
stipulated in a contract of loan,[13] the lender and the
borrower could validly agree on any interest rate on
loans. Thus, the Court of Appeals gravely erred when it
declared the stipulated interest in the Kasulatan as null as
if there was no express stipulation on the compounded
interest.[14]
Respondents Arguments
On the other hand, respondents assert that the appellate
court correctly struck down the said stipulated interest for
being excessive and contrary to morals, if not against the
law.[15] They also point out that a contract has the force of
law between the parties, but only when the terms,
clauses and conditions thereof are not contrary to law,
morals, public order or public policy.[16]
Our Ruling
The petition lacks merit.
The Court of Appeals correctly found that the 5% monthly
interest, compounded monthly, is unconscionable and
should be equitably reduced to the legal rate of 12% per
annum.
While we agree with petitioners that parties to a loan
agreement have wide latitude to stipulate on any interest
rate in view of the Central Bank Circular No. 905 s. 1982
which suspended the Usury Law ceiling on interest
effective January 1, 1983, it is also worth stressing that
interest rates whenever unconscionable may still be
declared illegal. There is certainly nothing in said circular
which grants lenders carte blanche authority to raise
interest rates to levels which will either enslave their
borrowers or lead to a hemorrhaging of their assets.[17]
In several cases, we have ruled that stipulations
authorizing iniquitous or unconscionable interests are
contrary to morals, if not against the law. In Medel v.
Court of Appeals,[18] we annulled a stipulated 5.5% per
month or 66% per annum interest on a P500,000.00 loan
and a 6% per month or 72% per annum interest on
a P60,000.00 loan, respectively, for being excessive,
iniquitous, unconscionable and exorbitant. In Ruiz v. Court
of Appeals,[19] we declared a 3% monthly interest imposed
on four separate loans to be excessive. In both cases, the
interest rates were reduced to 12% per annum.
In this case, the 5% monthly interest rate, or 60% per
annum, compounded monthly, stipulated in
the Kasulatan is even higher than the 3% monthly interest
rate imposed in the Ruiz case.Thus, we similarly hold the
5% monthly interest to be excessive, iniquitous,
unconscionable and exorbitant, contrary to morals, and
the law. It is therefore void ab initio for being violative
of Article 1306[20] of the Civil Code. With this, and in accord
with the Medel and Ruiz cases, we hold that the Court of
Appeals correctly imposed the legal interest of 12% per
annum in place of the excessive interest stipulated in
the Kasulatan.
The Court of Appeals did not unilaterally change the terms
and conditions of the Contract of Mortgage entered into
between the petitioners and the respondents.
Petitioners allege that the Kasulatan was entered into by
the parties freely and voluntarily.[21] They maintain that
there was already a meeting of the minds between the
parties as regards the principal amount of the loan, the
interest thereon and the property given as security for the
payment of the loan, which must be complied with in
good faith.[22] Hence, they assert that the Court of Appeals
should have given due respect to the provisions of
the Kasulatan.[23] They also stress that it is a settled
principle that the law will not relieve a party from the
effects of an unwise, foolish or disastrous contract,
entered into with all the required formalities and with full
awareness of what he was doing.[24]
Petitioners contentions deserve scant
[25]
consideration. In Abe v. Foster Wheeler Corporation, we
held that the freedom of contract is not absolute. The
same is understood to be subject to reasonable legislative
regulation aimed at the promotion of public health,
morals, safety and welfare. One such legislative regulation
is found in Article 1306 of the Civil Code which allows the
contracting parties to establish such stipulations, clauses,
terms and conditions as they may deem convenient,
provided they are not contrary to law, morals, good
customs, public order or public policy.
To reiterate, we fully agree with the Court of Appeals in
holding that the compounded interest rate of 5% per
month, is iniquitous and unconscionable. Being a void
stipulation, it is deemed inexistent from the
beginning. The debt is to be considered without the
stipulation of the iniquitous and unconscionable interest
rate. Accordingly, the legal interest of 12% per annum
must be imposed in lieu of the excessive interest
stipulated in the agreement, in line with our ruling in Ruiz
v. Court of Appeals,[26] thus:
The foregoing rates of interests and surcharges are in
accord with Medel vs. Court of Appeals, Garcia vs. Court of
Appeals, Bautista vs. Pilar Development Corporation, and
the recent case of Spouses Solangon vs. Salazar. This
Court invalidated a stipulated 5.5% per month or 66% per
annum interest on a P500,000.00 loan in Medel and a 6%
per month or 72% per annum interest on a P60,000.00
loan in Solangon for being excessive, iniquitous,
unconscionable and exorbitant. In both cases, we reduced
the interest rate to 12% per annum. We held that while
the Usury Law has been suspended by Central Bank
Circular No. 905, s. 1982, effective on January 1, 1983, and
parties to a loan agreement have been given wide latitude
to agree on any interest rate, still stipulated interest rates
are illegal if they are unconscionable. Nothing in the said
circular grants lenders carte blanche authority to raise
interest rates to levels which will either enslave their
borrowers or lead to a hemorrhaging of their assets. On
the other hand, in Bautista vs. Pilar Development Corp.,
this Court upheld the validity of a 21% per annum interest
on a P142,326.43 loan, and in Garcia vs. Court of Appeals,
sustained the agreement of the parties to a 24% per
annum interest on an P8,649,250.00 loan. It is on the basis
of these cases that we reduce the 36% per annum interest
to 12%. An interest of 12% per annum is deemed fair and
reasonable. While it is true that this Court invalidated a
much higher interest rate of 66% per annum in Medel and
72% in Solangon it has sustained the validity of a much
lower interest rate of 21% in Bautista and 24% in Garcia.
We still find the 36% per annum interest rate in the case
at bar to be substantially greater than those upheld by this
Court in the two (2) aforecited cases. (Emphasis supplied,
citations omitted)
From the foregoing, it is clear that there is no unilateral
alteration of the terms and conditions of
the Kasulatan entered into by the parties. Surely, it is
more consonant with justice that the subject interest rate
be equitably reduced and the legal interest of 12% per
annum is deemed fair and reasonable.[27]
The additional 1% per month penalty awarded as
liquidated damages does not have any legal basis.
In its June 11, 2002 Decision,[28] the trial court granted an
additional 1% per month penalty as liquidated
damages[29] beginning February 17, 1994 up to June 21,
2000.[30] Since respondents did not file their appellees
brief despite notice, the appellate court declared this to
be not in issue.[31]
Although the issue of the liquidated damages was not
presented squarely in either Memorandum of the parties,
this does not prevent us from ruling on the matter. In the
exercise of our appellate jurisdiction, we are clothed with
ample authority to review findings and rulings of lower
courts even if they are not assigned as errors. This is
especially so if we find that their consideration is
necessary in arriving at a just decision of the case. We
have consistently held that an unassigned error closely
related to an error properly assigned, or upon which a
determination of the question raised by the error properly
assigned is dependent, will be considered
notwithstanding the failure to assign it as an error.[32] On
this premise, we deem it proper to pass upon the matter
of liquidated damages.
Article 2226 of the Civil Code provides that [L]iquidated
damages are those agreed upon by the parties to a
contract, to be paid in case of breach thereof.
In the instant case, a cursory reading of
the Kasulatan would show that it is devoid of any
stipulation with respect to liquidated damages. Neither
did any of the parties allege or prove the existence of any
agreement on liquidated damages. Hence, for want of any
stipulation on liquidated damages in
the Kasulatan entered into by the parties, we hold that
the liquidated damages awarded by the trial court and
affirmed by the Court of Appeals to be without legal basis
and must be deleted.
The foreclosure proceedings held on March 3, 1999 cannot
be given effect.
The Court of Appeals modified the judgment of the trial
court by holding that respondents, in the interest of
substantial justice and equity, may redeem the
mortgaged property notwithstanding the lapse of the
period of redemption.
Petitioners argue that this cannot be done because the
right of redemption had long expired and same is no
longer possible beyond the one-year period provided
under Act No. 3135.[33]
On the other hand, respondents insist that to disallow
them to redeem the property would render meaningless
the declaration that the stipulated interest is null and void.
It is undisputed that sometime after the maturity of the
loan, respondent Tan attempted to pay the mortgage
debt of P30,000.00 as principal and some interest. Said
offer was refused by petitioners because they demanded
payment of the total accumulated amount
of P359,000.00.[34] Moreover, the trial court also
mentioned an offer by respondent Tan of the amount Anent the allegation of petitioners that the Court of
of P200,000.00 to petitioners in order for her to redeem Appeals erred in extending the period of redemption,
or re-acquire the property in litis.[35] same has been rendered moot in view of the nullification
of the foreclosure proceedings.
From these, it is evident that despite considerable effort
on her part, respondent Tan failed to redeem the WHEREFORE, the instant petition is DENIED. The assailed
mortgaged property because she was unable to raise the Decision of the Court of Appeals dated October 29, 2004
total amount of P359,000.00, an amount grossly inflated as well as the Resolution dated July 18, 2005
by the excessive interest imposed. Thus, it is only proper are AFFIRMED with the MODIFICATION that the award of
that respondents be given the opportunity to repay the 1% liquidated damages per month be DELETED and that
real amount of their indebtedness. petitioners are ORDERED to reconvey the subject
property to respondents conditioned upon the payment
In the case of Heirs of Zoilo Espiritu v. Landrito,[36] which is of the loan together with the rate of interest fixed herein.
on all fours with the instant case, we held that:
SO ORDERED.
Since the Spouses Landrito, the debtors in this case,
were not given an opportunity to settle their debt, at the
correct amount and without the iniquitous interest
imposed, no foreclosure proceedings may be
instituted. A judgment ordering a foreclosure sale is
conditioned upon a finding on the correct amount of the
unpaid obligation and the failure of the debtor to pay the
said amount. In this case, it has not yet been shown that
the Spouses Landrito had already failed to pay the correct
amount of the debt and, therefore, a foreclosure sale
cannot be conducted in order to answer for the unpaid
debt. The foreclosure sale conducted upon their failure to
pay P874,125.00 in 1990 should be nullified since the
amount demanded as the outstanding loan was
overstated; consequently it has not been shown that the
mortgagors the Spouses Landrito, have failed to pay their
outstanding obligation. x x x

As a result, the subsequent registration of the foreclosure

sale cannot transfer any rights over the mortgaged
property to the Spouses Espiritu. The registration of the
foreclosure sale, herein declared invalid, cannot vest title
over the mortgaged property. x x x (Emphasis supplied)

On this basis, we nullify the foreclosure proceedings held

on March 3, 1999 since the amount demanded as the
outstanding loan was overstated. Consequently, it has not
been shown that the respondents have failed to pay the
correct amount of their outstanding obligation.
Accordingly, we declare the registration of the foreclosure
sale invalid and cannot vest title over the mortgaged
property.
JOSE FELICIANO LOY, JR., G.R. No. 164886 This Petition for Review on Certiorari[1] assails the
RAYMUNDO HIPOLITO Decision[2] dated September 29, 2003 of the Court of
III, and Appeals in CA-G.R. CV No. 66261. The Court of Appeals
EDGARDO RIDAO, nullified the Decision[3] rendered by the Regional Trial
Petitioners, Court (RTC) of Manila, Branch 53, in Civil Case No. 93-
Present: 67275, which granted the motion for summary judgment
- versus - and ordered the release of the P3 million garnished funds
CARPIO,* J., in favor of petitioners Jose Feliciano Loy, Jr. (Loy, Jr.),
SAN MIGUEL Chairperson, Raymundo Hipolito III (Hipolito III) and Edgardo Ridao
CORPORATION (Ridao), as payment for their claim for attorneys fees.
EMPLOYEES UNION- LEONARDO-DE
Philippine CASTRO,** Petitioners Factual Allegations
Transport and General BRION,
Workers Petitioners filed a Complaint with Application for
Organization (SMCEU- DEL CASTILLO, and Preliminary Attachment[4] for the collection of unpaid
PTGWO), attorneys fees for the legal services they rendered to
as represented by its ABAD, JJ. respondent San Miguel Corporation Employees Union -
President Ma. Philippine Transport and General Workers Organization
Pilar B. Aquino and SAN (SMCEU-PTGWO), herein referred to as the Union. Also
MIGUEL impleaded as defendants in said complaint were
CORPORATION CREDIT Raymundo Hipolito, Jr. (Hipolito, Jr.), Efren Carreon
COOPERATIVE, INC., as (Carreon), Josefina Tongol (Tongol) and Pablo Dee (Dee),
represented by its Promulgated: who were then the President, Vice-President, Treasurer
President November 24, 2009 and Auditor of the Union, respectively.
Daniel Borbon,
Respondents. Petitioners averred that they acted as counsel for
x------------------------------------------x the Union in the negotiations of the 1992-1995 Collective
Bargaining Agreement (CBA) between the management
DECISION of three corporations (San Miguel Corporation, Magnolia
Corporation and San Miguel Foods, Incorporated) and
DEL CASTILLO, J.: the Union. They claimed that the legal services they
Summary judgments are sanctioned by the Rules of Court rendered to the Union amounted to at least P3 million.In
as a device to simplify and expedite the resolution of cases support of their claim, petitioners presented Board
when, as shown by pleadings, affidavits, depositions or Resolution No. 93-02-28[5] allegedly issued by the Unions
admissions on the records, there are no genuine issues Board of Directors on February 27, 1993 where it was
which would entail an expensive, lengthy and protracted allegedly resolved that herein petitioners are entitled to
trial. However, if there is a genuine issue of material fact 5% attorneys fees based on the 10% assessment fee
which calls for the presentation of evidence, resort to collected from union members and 10% agency fee
summary judgment would not be proper. Stated collected from non-union members. Petitioners also
otherwise, if there exists an issue of fact, the motion for alleged that pending resolution of the case, they are
summary judgment should be denied. entitled to the protection of attachment of some of
the Unions properties.
The instant case is not ripe for summary judgment
because the determination of the amount of reasonable On August 24, 1993, the RTC issued an Order[6] attaching
attorneys fees requires presentation of evidence and a all the properties of the Union.
full-blown trial.
Respondents Factual Allegations
The Union, Carreon and Tongol filed a Motion to
Discharge Writ of Attachment and Dismiss
Complaint.[7] They alleged that Board Resolution No. 93-
02-28 was not validly passed by the Unions Board or
ratified by the Unions general membership. Carreon also
alleged that no demand to pay attorneys fees was made
to the Union or any of the defendants and that petitioners
had already been paid for their services.
On the other hand, defendants Hipolito, Jr. and Dee filed
an Answer with Cross-Claim.[8] They admitted that
demand was made for the Union to pay attorneys fees
and that the Union was liable therefor. They, however,
denied any personal liability over the same. They also
claimed that Carreon and Tongol have absconded with
the Unions money. Thus, by way of cross-claim, Hipolito,
Jr. and Dee prayed that Carreon and Tongol be ordered to
indemnify them in the event they shall be adjudged
personally liable to pay petitioners.
By way of Reply with Counterclaim (to Answer with Cross
Claim),[9] Carreon and Tongol denied the allegations
against them and reiterated their position regarding the
defective board resolution.
Proceedings before the Regional Trial Court
On January 3, 1994, the RTC denied the Motion to
Discharge Writ of Attachment and Dismiss
Complaint.[10] In its Order dated January 4, 1994,[11] the
RTC ordered the garnishees San Miguel Corporation,
Magnolia Corporation, San Miguel Foods, Inc., and United
Coconut Planters Bank (UCPB) to deliver the garnished
funds to the Clerk of Court, RTC-Manila. Meanwhile, San
Miguel Corporation Credit Cooperative, Inc. (Credit
Cooperative) moved to intervene in the case claiming that
the garnished funds included cooperative dues, the seed
capital of which appears to have come from the union
funds. In its Answer in Intervention,[12] the Credit
Cooperative prayed for the lifting of the garnishment of its
funds, arguing that said funds do not belong to or are
owned by the Union but actually came from the individual
share capital of its members.
On September 29, 1994, a Compromise
Agreement[13] was entered into by petitioners and
Hipolito, Jr., the latter acting in his capacity as President of
the Union and obligating the Union to pay petitioners
claim for attorneys fees in the reduced amount of P1.5
million. This Compromise Agreement, although initially
approved by the RTC, was later on invalidated and set
aside by the trial court on the ground of irregularities
surrounding its execution.[14]
The case was then set for pre-trial conference.
Meanwhile, in a local union election of officers held on
August 21,
1996, Ma. Pilar B. Aquino (Aquino) and Marcial A. Frisnedi
(Frisnedi) were elected as the President and Vice-
President, respectively. As newly elected officers of
the Union, they filed a Motion for
[15]
Substitution/Intervention, which was granted in an
Order of the RTC dated May 7, 1997.[16] The RTC also
allowed the Union, under its new set of officers, to amend
its answer to the complaint. As a result, an Answer with
Counterclaim[17] was filed on September 29, 1997.
The RTC ordered the garnished funds of the Union in the
amount of P3 million to be deposited with the Philippine
National Bank.[18] On May 6, 1999, the trial court denied
the Unions motion to resume pre-trial and instead, set the
trial of the case on June 17, July 1 and 15, 1999.[19]
However, on June 16, 1999, petitioners filed a Motion for
Summary Judgment.[20] They averred that the case was
ripe for Summary Judgment because there was a judicial
admission that legal services were indeed rendered which
resulted to the benefits enjoyed by the workers in the
1992-1995 CBA.
The Union opposed the motion arguing that it only
admitted the allegation in the complaint insofar as the
benefits enjoyed by the workers in the 1992-1995 CBA are
concerned but not the legal services allegedly rendered by
petitioners. Further, it alleged that the amount claimed as
attorneys fees was unconscionable.
On September 14, 1999, the trial court rendered its
Decision granting the motion for summary judgment. It
held that the case was ripe for summary judgment in view
of the Unions admission, through Hipolito, Jr., of its
monetary obligation to petitioners in the amount of P3
million for the legal services they rendered. The
dispositive portion of the Decision reads:
WHEREFORE, premises considered, the Motion for
Summary Judgment is granted and judgment is hereby
rendered in favor of the plaintiffs as alleged in their
complaint.
The PNB, Escolta Branch, is therefore ordered to release
immediately the Three Million Pesos (P3,000,000.00)
garnished funds in the name of Regional Trial Court of
Manila, Branch 53, in connection with Civil Case No. 93-
67275 in favor of herein plaintiffs, in compliance with this
judgment.
SO ORDERED.[21]
Proceedings before the Court of Appeals
The Union appealed to the Court of Appeals which
rendered the assailed September 29,
[22]
2003 Decision, nullifying the RTCs Decision and
remanding the case to the trial court for further
proceedings. The appellate court noted that in the
amended answer, the Union denied the legal services
which petitioners claimed to have been rendered. It was
also alleged therein that Hipolito, Jr. fraudulently executed
the compromise agreement where he acceded, allegedly
on behalf of the Union, to pay the reduced amount
of P1.5 million as attorneys fees. Moreover, it was claimed
that Board Resolution No. 93-02-28 was not validly acted
upon by the Board or ratified by the general membership
of the Union. The P3 million attorneys fees was also
described as unconscionable. Finally, the intervenor Credit
Cooperative denied that the Union owned the funds that
were garnished. As found by the Court of Appeals, these
were issues which required the presentation of evidence
and which could only be resolved through full-blown trial
and proceedings.
The dispositive portion of the Decision of the Court of
Appeals reads:
WHEREFORE, finding merit in the appeal, the assailed
decision of September 14, 1999 is NULLIFIED and SET
ASIDE. Let the records be remanded to the court a quo for
further proceedings.
SO ORDERED.[23]
Petitioners filed a motion for reconsideration but it was
denied.
Issues
Hence, this petition anchored on the following grounds:
THE HONORABLE COURT OF APPEALS HAS DECIDED THE
CASE CONTRARY TO LAW ON SUMMARY JUDGMENT
AND TOTALLY IGNORING THE TWO (2) APPLICABLE AND
SIMILAR DECISION[24] AND RESOLUTION[25] OF THE
HONORABLE SUPREME COURT INVOLVING THE SAME
PARTIES, SAME ISSUES AND/OR SAME INCIDENT.
THE HONORABLE COURT OF APPEALS ERRONEOUSLY
RECOGNIZED INTERVENOR-RESPONDENT SAN MIGUEL
CORPORATION EMPLOYEES CREDIT COOPERATIVE INC.,
CONTRARY TO LAW UNDER ARTICLE 242 (D) AND (F) OF
THE LABOR CODE, AS AMENDED AND WHOSE IDENTITY
TO BE THAT OF THE DEFENDANT UNION HAD ALREADY
BEEN FINALLY RULED BY THE COURT A QUO.[26]
Petitioners contend that there are no genuine issues
necessitating a full-blown trial in view of the Answer with
Cross-Claim[27] filed by Hipolito, Jr. and Dee, which
essentially admitted all the allegations of the
complaint. They argue that the Court of Appeals erred in
holding that the Answer with Cross-Claim was superseded
and replaced by the Amended Answer with
Counterclaim[28]filed by the Union through its new set of
officers in 1997. They allege that their right to be
compensated for their legal services and the
reasonableness of the amount of their claim were already
heard, tried and upheld in Hipolito, Jr. v. Ferrer-
Calleja[29] and Aquino and Frisnedi v. Atty. Raymundo
Hipolito III. [30] Therefore, the controversy cannot anymore
be heard again on the theory of conclusiveness of
judgment. Finally, they claim that the Credit Cooperative
has no locus standi before the Court of Appeals and this
Court since it did not appeal from the RTCs Decision as
well as the RTCs Order[31] declaring that its funds were
part of union funds and were, therefore, properly
garnished. Hence, the Court of Appeals should not have
remanded the case to the RTC but instead affirmed
the September 14, 1999 Decision.
Our Ruling
The petition is partially meritorious.
The Answer with Counterclaim filed by Aquino and
Frisnedi merely supplemented the Answer with Cross-
Claim filed by Hipolito, Jr. and Dee; it cannot be deemed
to have replaced the same.
The voluminous records of this case disclose that
on September 23, 1993, an Answer with Cross-
Claim[32] essentially admitting all the allegations of the
Complaint[33] was filed by defendants Hipolito, Jr. and Dee,
as incumbent officers of the Union. Four years later, or
on September 29, 1997, another Answer with
Counterclaim[34] was filed by the Union through its new
set of officers. Petitioners contend that it was error for the
Court of Appeals to consider the first answer as expunged
by the subsequent answer filed by the new Union
officers. In refutation, respondent Unionasserts that the
former answer has been superseded by its amended
answer, which disputes the material allegations of the
complaint.
On this point, we agree with petitioners contention that
the first answer cannot be deemed to have been replaced
by the subsequent answer filed by the new Union
officers. Pleadings are amended in order to allege facts
which occurred prior to the filing of the original
pleading. An amended pleading supersedes the pleading
that it amends.[35] In the case at bar, the subsequent
answer could neither validly amend the first answer nor
result in the withdrawal of the latter. It is to be noted that
the new Union officers, upon their election, moved for
their intervention and substitution on the premise that
they became the real party in interest since the
defendants in the case have ceased to be the legal
representatives of the Union. Certainly, their election as
new officers is an occurrence which arose after the filing
of the first answer. Hence, the purported amended
answer should have been designated as a supplemental
answer. A supplemental pleading states the transactions,
occurrences or events which took place since the time the
pleading sought to be supplemented was filed.[36] A
supplemental pleading is meant to supply deficiencies in
aid of the original pleading and not to dispense with or
substitute the latter. It does not supersede the original,
but assumes that the original pleading is to stand.[37] As
such, the Answer with Counterclaim filed by Aquino and
Frisnedi did not result in the withdrawal of the Answer
with Cross-Claim filed by the original defendants in this
case, but was merely supplemented by the subsequent
answer.
There is an implied admission that petitioners rendered
legal services to the Union.
The supplemental answer contains an averment that
petitioners were already duly paid for their legal services
as shown by a Statement of Receipt and
Disbursements[38] issued by the union officers confirming
payment of petitioners legal fees. The same averment
was likewise evident in the Motion to Discharge Writ of
Attachment and Dismiss Complaint[39] filed by defendants
Carreon and Tongol. Indubitably, even without
considering the first answer, which admitted the
allegations in the complaint, an implied admission that
petitioners rendered legal services for the Union is
apparent in the pleadings filed by the defendants in the
case.
At any rate, the records of the case reveal that petitioners
indeed took part in the negotiations for the
consummation of the CBA. The letter of the Union
President addressed to San Miguel Corporation dated July
8, 1992, regarding the Unions CBA proposals for
1992,[40] as well as the Minutes of the First CBA
Negotiation Meeting held on July 23, 1992,[41] indicated
petitioners as members of the union negotiating
panel. Furthermore, the Integrated Bar of the Philippines
(IBP) confirmed petitioners representation for
the Union in the 1992-1995 collective bargaining
negotiations, as shown in an investigation conducted in
connection with the disbarment case filed against
petitioner Hipolito III.
Based on the foregoing, we find that petitioners indeed
rendered legal services to the Union.
The absence of an express authority from the Board is not
a bar to the recovery of attorneys fees.
The validity of the board resolution put forth by
petitioners as basis for their claim as well as the absence
of a written agreement as to the amount of attorneys fees
were questioned. However, it is relevant to mention that
in Hipolito, Jr. v. Ferrer-Calleja,[42] we ruled that,
notwithstanding the absence of an express authority from
the board, a lawyer who represented the union with the
knowledge and acquiescence of the board, and the
acceptance of benefits arising from the service rendered,
is entitled to a reasonable value of his professional
services on a quantum meruit basis.This finds application
in this case considering that the record establishes clearly
that petitioners acted as union counsel in the negotiation
and consummation of the 1992-1995 CBA and that the
benefits from the CBA had been enjoyed by the Union.
In Research and Services Realty, Inc. v. Court of
Appeals,[43] we enunciated that quantum meruit simply
means as much as he deserves. In no case, however, must
a lawyer be allowed to recover more than what is
reasonable, pursuant to Section 24, Rule 138 of the Rules
of Court.[44]
The determination of the amount of reasonable
attorneys fees would require presentation of evidence
and a full-blown trial.
The Rules of Court allows the rendition of a summary
judgment if the pleadings, supporting affidavits,
depositions and admissions on file, show that, except as
to the amount of damages, there is no genuine issue as to
any material fact and that the moving party is entitled to a
judgment as a matter of law.[45] There can be no summary
judgment where questions of fact are in issue or where
material allegations of the pleadings are in dispute.[46]
In fixing a reasonable compensation for the services
rendered by a lawyer on the basis of quantum meruit, the
elements to be considered are generally (1) the
importance of the subject matter in controversy, (2) the
extent of services rendered and (3) the professional
standing of the lawyer. A determination of these factors
would indispensably require nothing less than a full-blown
trial where the party can adduce evidence to establish the
right to lawful attorney's fees and for the other party to
oppose or refute the same.[47]
The Union considers the attorneys fees in the amount
of P3 million as unreasonable, unconscionable and
without basis. In fixing said amount of attorneys fees, the
RTC ratiocinated that the issue of the reasonableness of
the amount claimed as attorneys fees had been heard by
the IBP in the disbarment case. It also relied on the
testimony given by Ms. Oswalda Abuerne (Abuerne), the
Credit Cooperatives bookkeeper, on October 4, 1994, as
follows:
Q Now, according to your earlier statement in open Court
you said that P589,992.83 of the money now in the
possession of the San Miguel Corporation Employees
Credit Cooperative, Inc., came from union members?
A Yes, sir.
Q How did you happen to collect these from the union
members, to receive these from the union members?
A Based on the records of the cooperative, I think it was
1990 CBA, that the union, I mean, there is an agreement
between the members, that the members of the union, I
think all the employees of the San Miguel Corporation
signed an agreement that the lump sum money they will
receive they will give five (5%) percent for attorneys fee
and that five (5%) percent, 4% is for attorneys fee and
one (1%) percent is for the seed capital of the
cooperative.[48]
Based on this testimony, the RTC concluded that:
The question of unconscionableness of P3,000,000,00
Attorneys fees of Atty. Hipolito has been heard and tried
by the Integrated Bar of the Philippines. Hence, all
defenses and claims of defendant Union now through the
new president Aquino shall be dismissed under Section 7,
Rule 9, 1997 Rules of Civil Procedure necessitating a
Summary judgment, attaching therewith the various
transcripts of stenographic notes of the Integrated Bar of
the Philippines. That there is [sic] no more triable issues
otherwise what was heard by the IBP on unconscionable
attorneys fees would be heard again. That if the
defendant Union in 1990 prior to the instant case paid a
single lone-lawyer of the Union of 5% broken down as
follows: 4% (2.3 Million as Attorneys fees) and 1%
(670,799.52 as seed capital of the Unions cooperative) as
shown in the Courts T.S.N. dated October 4, 1994; the
defendant Union can not now claim the P3 Million
Attorneys fees for three (3) lawyers with a higher and
subsequent 1993 CBA benefits as unconscionable.[49]
We find that the RTC erroneously ruled on this
matter. First, it does not appear from the Report and
Recommendation[50] of Commissioner Jaime M. Vibar, the
IBP Commissioner who tried the disbarment case, that a
pronouncement was made as to how much Hipolito III
(petitioner herein) should receive as attorneys fees. The
IBP merely sustained Hipolito IIIs entitlement to
compensation for acting as union counsel in collaboration
with Loy, Jr. and Ridao (co-petitioners herein) in
concluding the 1992-1995 CBA, but refused to fix an
amount as the matter was already being heard in
court. Second, the testimony of Abuerne was
unsubstantiated by evidence, thereby making her an
incompetent witness to testify on such matters. The
records of the Credit Cooperative were not presented to
substantiate Abuernes statements. The lawyer who was
allegedly paid P2.3 million attorneys fees in 1990 was not
also presented to testify. No proof was proffered to show
that Hipolito III was entitled to or actually received the
amount. Hence, the RTC arbitrarily fixed petitioners
attorneys fees at P3 million despite insufficient factual
basis.
When material allegations are disputed, it cannot be
asserted that there is no real issue necessitating a formal
trial.[51] We deem it necessary, therefore, that further
inquiry should be made in order for petitioners to prove
the extent of the services they rendered, the time they
consumed in the negotiations and such other matters
necessary for the determination of the reasonable value
of their services.
Mindful that the instant case has been pending for more
than a decade, we painstakingly reviewed the
records. Unfortunately, we find them inadequate and
insufficient to determine the reasonableness of the
amount claimed or to fix, for that matter, a reasonable
amount of attorneys fees in order to finally resolve the
present controversy. Thus, in order to adequately afford
both parties ample opportunity to present their evidence
in support of their respective claims, a remand is
inevitable, but only for the purpose of determining the
reasonable amount of attorneys fees on quantum
meruit basis.
The imposition of interest on the amount claimed is not
warranted.
The imposition of any interest, as prayed for in this instant
petition, on any amount payable to petitioners is,
however, unwarranted. Contracts for attorneys services
are unlike any other contracts for the payment of
compensation for any other services which allow the
imposition of interest in case of delay under the provisions
of the Civil Code.[52] The practice of law is a profession, not
a moneymaking venture.[53]
The Credit Cooperative has no locus standi for failure to
file an appeal.
Petitioners correctly argue that the Credit Cooperative
has no locus standi on appeal, since it failed to file a notice
of appeal to the RTCs September 14, 1999 Decision
granting the motion for summary judgment. It was only
the Union which appealed the case through a notice of
appeal filed by its counsel, Atty. Luciano R. Caraang (Atty.
Caraang). There is also no showing that Atty. Caraang
represented both the Union and the Credit Cooperative in
filing such notice of appeal. In fact, the Credit Cooperative
did not deny its failure to file an appeal; however, it
argued that it filed with the Court of Appeals an appellants
brief in compliance with the appellate courts directive to
submit one. Suffice it to state that the Court of Appeals
directive for the Credit Cooperative to file its brief did not
clothe the Credit Cooperative with locus standi on
appeal. The purpose of the filing of the brief is merely to
present, in coherent and concise form, the points and
questions in controversy, and by fair argument on the
facts and law of the case, to assist the court in arriving at a
just and proper conclusion.[54] The Court of Appeals may
have ordered the Credit Cooperative to submit its brief to
enable it to properly dispose of the case on
appeal. However, in the Credit Cooperatives brief, not
only did it ask for the reversal of the Summary Judgment
but also prayed for the return of its garnished funds. This
cannot be allowed. It would be grave error to grant the
relief prayed for without violating the well-settled rule
that a party who does not appeal from the decision may
not obtain any affirmative relief from the appellate court
other than what he has obtained from the lower court, if
any, whose decision is brought up on appeal.[55] The rule is
clear that no modification of judgment could be granted
to a party who did not appeal.[56]
WHEREFORE, the petition is PARTIALLY GRANTED. The
Decision of the Court of Appeals
is AFFIRMED with MODIFICATION that the case is
ordered remanded to the court of origin for further trial
but only for the purpose of fixing the petitioners attorneys
fees (without interest) on quantum meruit basis, to be
conducted with deliberate dispatch in accordance with
this Decision.
SO ORDERED.
POWER SITES AND G.R. No. 163406
SIGNS, INC.,
Petitioner's Factual Allegations
Petitioner,

Present:
Power Sites and Signs, Inc. (Power Sites) is a corporation
engaged in the business of installing outdoor advertising
signs or billboards. It applied for, and was granted, the
CARPIO,* J., Chairperson, necessary permits to construct a billboard on a site
- versus - LEONARDO-DE CASTRO,** located at Km. 23, East Service Road, Alabang, Muntinlupa
(the site).[4] After securing all the necessary permits,
BRION, Power Sites began to construct its billboard on the site.

DEL CASTILLO, and

ABAD, JJ. Subsequently, in March 2002, petitioner discovered that

respondent United Neon, a Division of Ever Corporation
UNITED NEON (a (United Neon), had also began installation and erection of
Division of Ever a billboard only one meter away from its site and which
completely blocked petitioners sign. Thus, on March 5,
Corporation), Promulgated:
2002, petitioner requested United Neon to make
Respondent. November 24, 2009 adjustments to its billboard to ensure that petitioners sign
would not be obstructed.[5] However, petitioners
x---------------------------------------------- repeated requests that respondent refrain from
-----------------------x constructing its billboard were ignored,[6] and attempts to
amicably resolve the situation failed.[7]

Respondent's Factual Allegations

DECISION

In January 2002, United Neon and Power Sites separately

DEL CASTILLO, J.:
Before a court grants injunctive relief, the following must
be demonstrated: that complainant is entitled to the relief
sought, the actual or threatened violation of complainants
rights, the probability of irreparable injury, and the
inadequacy of pecuniary compensation as
[1]
relief. Otherwise, there is no basis for the issuance of a
writ of injunction.
This is a Petition for Review on Certiorari under Rule 45 of
the Rules of Court of the Decision[2] dated January 29,
2004 and the Resolution[3] dated April 28, 2004 of the
Court of Appeals in CA-G.R. SP No. 72689.
negotiated with Gen. Pedro R. Balbanero to lease a
portion of a property located at East Service Road, South
Superhighway, Alabang, Muntinlupa City, in order to build
a billboard on the premises.[8] Gen. Balbanero rejected
Power Sites proposal and decided to lease the premises to
United Neon. Thus, on January 26, 2002, United Neon and
Gen. Balbanero entered into a Contract of Lease (the
lease contract).[9]
On January 28, 2002, United Neon registered the lease
contract with the Outdoor Advertising Association of the
Philippines (OAAP), in accordance with Article 11, Sec. 3.6
of the OAAP Code of Ethics/Guidelines.[10] By virtue of its
registration of the Contract of Lease with the OAAP,
United Neon alleged that it obtained the exclusive right to
the line of sight over the leased property, in accordance
with Article 11, Section 3.7 of the OAAP Code of
Ethics/Guidelines.[11]
Sometime in February 2002, United Neon started
construction of its billboard. Power Sites, after failing to
lease the premises from Gen. Balbanero, negotiated with
the owner of the adjacent property and secured its own
lease in order to erect a billboard that would disrupt
United Neons exclusive line of sight.[12] To protect its
rights, on March 6, 2002, United Neon urged Power Sites
to relocate the latters sign to another location, or to
construct it in such a way that the sign would not obstruct
the view of United Neons billboard.[13]
Legal Proceedings
In a letter-complaint dated June 29, 2002, petitioner
requested the Muntinlupa City Engineer and Building
Official to revoke United Neons building permit and to
issue a Cease and Desist Order against it.[14] On July 4,
2002, the City Building Official, Engineer Robert M. Bunyi,
referred the complaint to United Neon for comment:
This refers to your ongoing construction of signboard
located at East Service Road, Alabang, City of Muntinlupa,
which was granted Building Permit No. 12-02-05-357
dated May 22, 2002 and which is the object of an
attached formal complaint x x x
Relative to the foregoing and per inspection conducted by
this office, we have noted that your sign is 4 meters away
from an existing and on going sign construction with
building permit no. 12-02-02-111 which was granted
earlier than your permit.
We therefore direct you to submit your position and all
your related supporting evidence whether or not you
violated the Code of Ethics of Advertisement which is
expressly supported by the National Building Code (PD
1096) Rule V, Section 2.1 of the General Provision and to
maintain status quo by desisting from all construction
activities in the meantime that this matter is being studied
for resolution by this office.[15]
However, before a resolution could be made by the City
Building Official, Power Sites filed on July 1, 2002,
a Petition for Injunction with Writ of Preliminary Injunction
and Prayer for Temporary Restraining Order and
Damages[16] against United Neon before the Regional Trial
Court (RTC) of Muntinlupa City, which was raffled to
Branch 256 and docketed as Civil Case No. 02-143.
After the filing of the parties respective
memoranda,[17] which took the place of testimonial
evidence, the RTC granted petitioners prayer for the
issuance of a preliminary injunction in an Order dated
August 1, 2002.[18] The Writ of Injunction was issued on
the same day.[19] The RTC ruled:
After considering the arguments raised by both parties in
their respective Memoranda, this Court finds that the
plaintiff is entitled to the relief sought considering that the
commission and/or continuance of the act of installing the
signage by the respondent during the litigation would
work grave injustice and irreparable damage to petitioner
since it would surely cause immense loss in profit and
possible damage claims from its clients because it would
certainly cover the sign of the petitioner's clients.
xxxx
WHEREFORE, this Court finds the plaintiffs application for
the issuance of a Writ of Preliminary Injunction to be
meritorious and well taken.
Let therefore a Writ of Preliminary Injunction be issued
against the respondent UNITED NEON to cease and desist
from constructing/installing the signage and to dismantle
any existing sign, girds [sic] or post that support said sign.
x x x x[20]
United Neon then filed a Petition for Prohibition and
Certiorari with Application for Temporary Restraining
Order and/or Writ of Preliminary Injunction[21] before the
Court of Appeals, which was docketed as CA-G.R. SP No.
72689. In brief, United Neon claimed that the grant of
preliminary injunction was unwarranted, particularly
because Power Sites only prayed for a prohibitory
injunction in its original petition, but the Order went as far
as to grant a mandatory injunction in favor of Power
Sites. United Neon prayed that the Court of Appeals
invalidate the RTCs Order and Writ dated August 1, 2002,
issue a temporary restraining order enjoining the RTC
from further proceeding with Civil Case No. 02-143, and,
after hearing, enjoin the RTC from enforcing the August 1,
2002 Order.
After the parties exchange of pleadings, the Court of
Appeals invalidated the Order of the RTC dated August 1,
2002 and the Writ of Preliminary Injunction, but denied
the prayer for prohibition, to wit:
To warrant the issuance of an injunction, whether
prohibitory or mandatory, private respondent's right to
the line of sight must be clear. In this case, there is a cloud
of doubt as to private respondent's right to the claimed
line of sight as petitioner had manifested prior registration
of its billboard with the Outdoor Advertising Association
of the Philippines (OAAP) which allegedly gave petitioner a
protection of its exclusive right to the line of sight.
Injunction should be issued when there is a substantial
challenge to the claimed right. The conflicting claims by
the parties to the right to the line of sight present an
impression that the right claimed by private respondent
as its basis for the prayer for the injunctive relief is far
from clear. While it is not required that private
respondent's right be conclusively established at this
stage, it is nevertheless necessary to show, at least
tentatively, that it exists and is not vitiated by any
substantial challenge or contradiction, such as has been
made by petitioner.
Even the issue of the status quo ante cannot be
determined clearly in this case. The status quo ante
referred to by private respondent was seriously
challenged by petitioner by claiming it was the first to
build its structure. Hence, public respondent had no clear
basis for the status quo ordered in the injunctive order.
xxxx
On the matter of the prayer for prohibition, it is incorrect
and improper to declare public respondent incapable of
rendering a fair trial due to the erroneous injunctive order
issued. Petitioner may avail of other legal remedies if it
truly believes that public respondent can no longer deliver
fair judgment in this case.
WHEREFORE, premises considered, the petition is
PARTIALLY GRANTED, as follows:
1. The assailed Order dated August 1, 2002 and the Writ
of Preliminary Injunction issued by public respondent in
Civil Case No. 02-143 are hereby declared NULL AND VOID
for having issued with grave abuse of discretion
amounting to lack or excess of jurisdiction; and
2. The prayer for prohibition is hereby DENIED for lack of
merit.
SO ORDERED.[22]
Petitioners Motion for Partial Reconsideration was denied
by the Court of Appeals in a Resolution dated April 28,
2004.[23] Hence, this petition.
Arguments
In essence, Power Sites claims that the Court of Appeals began construction ahead of Power Sites, and registered
gravely erred in invalidating the Writ of Preliminary its lease with the OAAP.
Injunction for the following reasons:

2) The issuance of the preliminary mandatory injunction

1) Power Sites has a better right over the line of sight
because it constructed its billboard ahead of the
respondent and is therefore entitled to protection under
the National Building Code. United Neon could not have
begun construction ahead of Power Sites (allegedly in
February 2002), since it only obtained its Building Permit
in May of 2002. Further, the alleged registration of the
lease contract with the OAAP does not bind Power Sites,
since the latter is not a member of the OAAP. In any
event, proof of the alleged registration of the lease
contract was not presented before the trial court; all that
was submitted in evidence was an application letter to the
OAAP.
2) Even if its original petition did not contain a prayer for
the issuance of a mandatory injunction, its Memorandum
before the trial court requested the grant of a mandatory
injunction.[24] United Neon was still in the initial stages of
construction at the time the original petition was filed;
hence, Power Sites only prayed for the issuance of a
preliminary prohibitory injunction to preserve the status
quo. However, at the time the parties were required to
file their respective memoranda, United Neons structure
was already fully completed. Thus, a preliminary
mandatory injunction was required.
by the RTC, which went beyond the allegations and prayer
in the initiatory petition, constituted grave abuse of
discretion amounting to lack or excess of jurisdiction.
3) Power Sites did not even have the required permits to
construct a billboard, since all the permits issued by the
Muntinlupa City government were issued to HCLC
Resources and Development Corporation, and not to
Power Sites.
4) Power Sites willfully violated the rules against forum
shopping, since it sought the same relief from the
Muntinlupa City Building Official and before the RTC.
Our Ruling
We find the grant of a preliminary mandatory injunction
by the trial court not warranted. Consequently, we affirm
the Decision of the Court of Appeals dated January 29,
2004 and its Resolution dated April 28, 2004 in CA-G.R. SP
No. 72689.

3) The Court of Appeals should have dismissed outright Procedural Issue

the Petition for Certiorari, since United Neon failed to
attach all the relevant pleadings, in disregard of the Rules
of Court.
The Court of Appeals properly exercised its discretion in
giving due course to the petition

On the other hand, United Neon claims that the Court of

Appeals Decision and Resolution were correct, and the
Power Sites claims that the Court of Appeals should not
trial courts Order dated August 1, 2002 and the writ of
have entertained the petition for certiorari because
injunction were patently illegal, for the following reasons:
United Neon failed to attach the requisite documentary
1) Power Sites has no clear and unmistakable right to be evidence to its petition.
protected, since it failed to register its lease contract with
the OAAP. In contrast, it is United Neon that has the
exclusive right to the line of sight because United Neon
We are not persuaded. Section 1 of Rule 65 of the Rules of
Court provides:
Section 1. Petition for certiorari. x x x
The petition shall be accompanied by a certified true copy
of the judgment, order or resolution subject thereof,
copies of all pleadings and documents relevant and
pertinent thereto, and a sworn certification of non-forum
shopping as provided in the third paragraph of Section 3,
Rule 46.
A plain reading of the provision indicates that there is no
specific enumeration of the documents that must be
appended to the petition, other than a certified true copy
of the assailed judgment, order, or resolution. In Condes v.
Court of Appeals,[25] we held that the acceptance or
rejection by the Court of Appeals of a petition
for certiorari rests in its sound discretion. Thus:
x x x The initial determination of what pleadings,
documents or orders are relevant and pertinent to the
petition rests on the petitioner. Thereafter, the CA will
review the petition and determine whether additional
pleadings, documents or orders should have been
attached thereto.
The appellate court found the present petition sufficient
in form when it proceeded to decide the case on the
merits, without raising any question as to the sufficiency
of the petition. Acceptance of a petition for certiorari, as
well as granting due course thereto is addressed to the
sound discretion of the court. Where it does not appear,
as in this case, that in giving due course to the petition
for certiorari, the CA committed any error that
prejudiced the substantial rights of the parties, there is
no reason to disturb its determination that the copies of
the pleadings and documents attached to the petition
were sufficient to make out a prima facie case. (Emphasis
supplied)
In the same manner, we find no reversible error when the
Court of Appeals gave due course to the petition, since it
evidently found that the documents attached to the
petition were sufficient.
Substantive Issues
The applicant must show that it is entitled to the relief
sought, and that acts are being undertaken in violation of
the applicants rights
We emphasize that at this stage of the proceedings, we
are not concerned with the merits of the case, but only
with the propriety of the issuance of the preliminary
injunction by the trial court. After a painstaking review of
the arguments and evidence presented by the parties, we
find that petitioner was not entitled to the grant of a
preliminary injunction for two reasons: first, the alleged
right sought to be protected by the petitioner was not
clearly demonstrated; second, the requirement of grave
and irreparable injury is absent.
A preliminary injunction may be granted only where the
plaintiff appears to be clearly entitled to the relief
sought[26] and has substantial interest in the right sought
to be defended.[27]While the existence of the right need
not be conclusively established, it must be clear.[28] The
standard is even higher in the case of a preliminary
mandatory injunction, which should only be granted
x x x in cases of extreme urgency; where the right is very
clear; where considerations of relative inconvenience bear
strongly in complainant's favor; where there is a willful
and unlawful invasion of plaintiff's right against his protest
and remonstrance, the injury being a continuing one; and
where the effect of the mandatory injunction is rather to
reestablish and maintain a preexisting continuing relation
between the parties, recently and arbitrarily interrupted
by the defendant, than to establish a new relation x x x.[29]
The evidence presented before us in support of a
preliminary injunction is weak and inconclusive, and the
alleged right sought to be protected by petitioner is
vehemently disputed. We note that both parties allege
that: (1) they began construction of their respective
billboards first; (2) the billboard of the other party blocks
the others exclusive line of sight; (3) they are entitled to
protection under the provisions of the National Building
Code and OAAP Code of Ethics/Guidelines.[30] However,
we are not in a position to resolve these factual matters,
which should be resolved by the trial court. The question
of which party began construction first and which party is
entitled to the exclusive line of sight is inextricably linked
to whether or not petitioner has the right that deserves
protection through a preliminary injunction. Indeed, the
trial court would be in the best position to determine
which billboard was constructed first, their actual location,
and whether or not an existing billboard was obstructed
by another.
At this juncture, it is not even clear to us what relationship
Power Sites has to the billboard that would entitle it to
seek an injunction, since the documents before us
indicate that the barangay clearance and the
Billboard/Signboard permit were issued to HCLC Resource
and Development Corporation, while the Building Permit
and Electrical Permit were issued to Mr. Renato Reyes
So.[31] As regards the identity of these parties, the
explanation thus far presented was
HCLC Resource and Development Corp. (HCLC) is a
corporation whose majority shares of stock are owned by
Mr. Renato So, the same majority owner and President of
Power Sites. HCLC and Power Sites are closely connected.
HCLC was the entity which constructs the billboards of
Power Sites, while the latter remains the owner of the
billboards.
Needless to say, this flies in the face of the basic principle
in corporation law that a corporation has a personality
separate and distinct from those of its stockholders and
other corporations to which it may be
connected. Nonetheless, these are matters that are better
resolved in the course of trial.
The damages alleged by petitioner can be quantified; it
cannot be considered as Grave and Irreparable Injury as
understood in law
It is settled that a writ of preliminary injunction should be
issued only to prevent grave and irreparable injury, that is,
injury that is actual, substantial, and demonstrable. Here,
there is no irreparable injury as understood in law. Rather,
the damages alleged by the petitioner, namely, immense
loss in profit and possible damage claims from clients and
the cost of the billboard which is a considerable amount
of money[32] is easily quantifiable, and certainly does not
fall within the concept of irreparable damage or injury as
described in Social Security Commission v. Bayona:[33]
Damages are irreparable within the meaning of the rule
relative to the issuance of injunction where there is no
standard by which their amount can be measured with
reasonable accuracy. An irreparable injury which a court
of equity will enjoin includes that degree of wrong of a
repeated and continuing kind which produce hurt,
inconvenience, or damage that can be estimated only by
conjecture, and not by any accurate standard of
measurement. An irreparable injury to authorize an
injunction consists of a serious charge of, or is destructive
to, the property it affects, either physically or in the
character in which it has been held and enjoined, or when
the property has some peculiar quality or use, so that its
pecuniary value will not fairly recompense the owner of
the loss thereof. (Emphasis supplied)
Here, any damage petitioner may suffer is easily subject to
mathematical computation and, if proven, is fully
compensable by damages.[34] Thus, a preliminary
injunction is not warranted. As previously held in Golding
v. Balatbat,[35] the writ of injunction
should never issue when an action for damages would
adequately compensate the injuries caused. The very
foundation of the jurisdiction to issue the writ rests in the
probability of irreparable injury, the inadequacy of
pecuniary compensation, and the prevention of the
multiplicity of suits, and where facts are not shown to
bring the case within these conditions, the relief of
injunction should be refused.

WHEREFORE, the petition is DENIED. The Decision of the

Court of Appeals dated January 29, 2004 in CA-G.R. SP No.
72689 declaring as null the August 1, 2002 Order of the
Regional Trial Court of Muntinlupa City, Branch 256 and
the Writ of Injunction in Civil Case No. 02-143, and
denying the prayer for prohibition, and its Resolution
dated April 28, 2004 denying the Motion for
Reconsideration, are AFFIRMED.

SO ORDERED.
EUGENIO S. CAPABLANCA, G.R. No. 179370 temporary status[3] and was assigned at the PNP Station
Petitioner, in Butuan City. On November 29, 1998, petitioner took
Present: the PNP Entrance Examination conducted by the National
Police Commission (NAPOLCOM)[4] and passed the
PUNO, C. J., same. On July 28, 2000, he took the Career Service
CARPIO, Professional Examination-Computer Assisted Test (CSP-
CORONA, CAT) given by the Civil Service Commission (CSC)[5] and
CARPIO MORALES, likewise passed the same. Thereafter, or on October 3,
CHICO-NAZARIO, 2000, the Regional Director of Police Regional Office XIII
VELASCO, JR., conferred upon petitioner the permanent status as PO1.[6]
- versus - NACHURA,
LEONARDO-DE Proceedings before the Civil Service Commission
CASTRO,
BRION, On October 15, 2001, the CSC Caraga Regional Office XIII
PERALTA, (CSC Caraga) through its Regional Director Lourdes
BERSAMIN, Clavite-Vidal informed PO1 Capablanca about certain
DEL CASTILLO, alleged irregularities relative to the CSP-CAT which he
ABAD, and took on July 28, 2000. According to the CSC, the person in
VILLARAMA, JJ. the picture pasted in the Picture Seat Plan (PS-P) is
different from the person whose picture is attached in the
CIVIL SERVICE Promulgated: Personal Data Sheet (PDS) and that the signature
COMMISSION,* appearing in the PS-P was different from the signature
Respondent. November 19, 2009 affixed to the PDS.[7] The CSC further informed petitioner
x--------------------------------------- that such findings of alleged examination irregularities
-----------x constituted the offense of dishonesty if prima
facie evidence was established.

DECISION A Preliminary Investigation was scheduled on November

DEL CASTILLO, J.:
Uniformed members of the Philippine National Police
(PNP) are considered employees of the National
Government, and all personnel of the PNP are subject to
civil service laws and regulations.[1] Petitioner cannot
evade liability under the pretense that another agency has
primary jurisdiction over him. Settled is the rule that
jurisdiction is conferred only by the Constitution or the
law.[2] When it clearly declares that a subject matter falls
within the jurisdiction of a tribunal, the party involved in
the controversy must bow and submit himself to the
tribunal on which jurisdiction is conferred.
Factual Antecedents
On October 3, 1996, the PNP-Regional Office 10
appointed petitioner Eugenio S. Capablanca into the PNP
service with the rank of Police Officer 1 (PO1) with a
16, 2001;[8] petitioner failed to appear but was
represented by counsel who moved to dismiss the
proceedings. He argued that it is the NAPOLCOM which
has sole authority to conduct entrance and promotional
examinations for police officers to the exclusion of the
CSC, pursuant to Civil Service Commission v. Court of
Appeals.[9] Thus, the CSP-CAT conducted on July 28,
2000 was void. Moreover, he alleged that the
administrative discipline over police officers falls under the
jurisdiction of the PNP and/or NAPOLCOM.[10]
In an Order[11] dated November 16, 2001, the CSC Caraga
held that there was no dispute that it was the NAPOLCOM
which had the sole authority to conduct the entrance and
promotional examinations of police officers. However,
since petitioner submitted a CSC Career Service
Professional eligibility and not a NAPOLCOM eligibility to
support his appointment on a permanent status, then the
CSC had jurisdiction to conduct the preliminary
investigation.
The dispositive portion of the CSC Order dated November
16, 2001, reads:
WHEREFORE, the Motion to Dismiss filed by Atty. Poculan,
for his client, Eugenio S. Capablanca is hereby DENIED for
lack of merit. Accordingly, Capablanca is directed to
submit his counter-affidavit within five (5) days from
receipt hereof.[12]
Proceedings before the Regional Trial Court
To prevent the CSC Caraga from further proceeding with
the conduct of the administrative investigation, PO1
Capablanca filed on January 16, 2002 a Petition[13] for
prohibition and injunction with a prayer for the issuance
of a temporary restraining order and writ of preliminary
injunction with the Regional Trial Court of Butuan. The
said court issued a 20-day temporary restraining order
and set the case for summary hearing on February 8,
2002 to resolve the application for preliminary
injunction.[14]
Instead of filing its Answer, the CSC Caraga moved to
dismiss the case,[15] arguing inter alia that: a) PO1
Capablanca failed to exhaust administrative remedies by
appealing before the CSC Central Office instead of filing a
petition before the trial court; b) PO1 Capablancas
reliance on Civil Service Commission v. Court of
Appeals[16] was misplaced because what he took was a
career service professional examination and not a police
entrance examination; and c) the CSC was not stripped of
its original disciplinary jurisdiction over all cases involving
civil service examination anomalies.
In its March 8, 2002 Resolution,[17] the trial court denied
CSCs Motion to Dismiss for lack of merit. It held that the
CSC had no jurisdiction to conduct the preliminary
investigation, much less to prosecute PO1
Capablanca. The dispositive portion of the Resolution,
reads:
WHEREFORE, in view of all the foregoing, respondents
motion to dismiss is denied for lack of merit. As a
consequence and for want of jurisdiction, herein
respondent, its Regional Director, Region 13 Caraga, or its
officers, attorneys agents, or any person acting for and its
behalf, is hereby ordered to finally, permanently and
perpetually desist, cease and stop from proceeding or
conducting any administrative investigation against the
petitioner Eugenio S. Capablanca.
No pronouncement as to costs.
IT IS SO ORDERED.[18]
Proceedings before the Court of Appeals
Its Motion for Reconsideration[19] unheeded,[20] the CSC
Caraga filed a Petition
for Certiorari[21] before the Court of Appeals praying for
the nullification of the Resolution of the trial court, and at
the same time insisting on its jurisdictional power to
prosecute the administrative case involving dishonesty
and that PO1 Capablanca failed to exhaust administrative
remedies.
In his Comment,[22] the petitioner contended that there
was no need to exhaust administrative remedies because
the proceeding before the CSC was an absolute nullity,
and that it was the NAPOLCOM, the Peoples Law
Enforcement Board (PLEB), or PNP which had primary
jurisdiction over the alleged irregularities in the CSP-
CAT. He alleged that the case involved a purely legal issue
and that he would suffer irreparable injury if he should still
await the outcome of the administrative action before the
CSC Central Office. PO1 Capablanca stressed that the July
28, 2000 CSP-CAT was ineffectual as far as he was
concerned, because it was in the nature of a promotional
examination for policemen and was solely within
the province of NAPOLCOM.
On March 22, 2006, the Court of Appeals rendered its
Decision[23] granting CSCs petition. The Court of Appeals
found that PO1 Capablanca prematurely resorted to court
intervention when the remedy of appeal to the CSC
Central Office was available. Upholding the jurisdiction of
the CSC Caraga, the appellate court declared that the
subject of the latters preliminary investigation was not
with respect to PO1 Capablancas acts in the conduct of his
duties as a police officer, but with respect to the
authenticity of the documents he submitted before the
CSC Caraga in support of his application for permanent
status as well as the veracity of its contents. It held that
pursuant to the CSC's constitutional duty to protect the
integrity of the civil service system, it acted within its
authority to investigate irregularities or anomalies
involving civil service examinations, and to ascertain
whether a prospective civil service appointee is qualified
in accordance with all the legal requirements.
Hence, this petition.
Petitioners Arguments
Petitioner PO1 Capablanca assigns the following errors:
1 examination irregularity.
THE HONORABLE COURT OF APPEALS, WITH DUE
RESPECT, GRAVELY ERRED IN DECLARING THAT
RESPONDENT CSC HAS JURISDICTION AND DISCIPLINARY
AUTHORITY OVER HEREIN PETITIONER, A MEMBER OF
THE PHILIPPINE NATIONAL POLICE.
1-A
GRANTING THAT IT HAS, THE HONORABLE COURT OF
APPEALS GRAVELY ERRED IN NOT DECLARING THAT IT
HAS ONLY APPELLATE JURISDICTION OVER THE CASE AND
IT IS THE NATIONAL POLICE COMMISSION (NAPOLCOM)
WHICH HAS THE JURISDICTION TO CONDUCT INITIATORY
INVESTIGATION OF THE CASE, AS HELD IN THE CASE
OF MIRALLES VS. GO, G.R. NO. 139943, JANUARY 18,
2001.
II
THE HONORABLE COURT OF APPEALS, WITH DUE
RESPECT GRAVELY ERRED IN DECLARING THAT HEREIN
PETITIONER FAILED TO EXHAUST ADMINISTRATIVE
REMEDIES.[24]
Respondents Arguments
The CSC, through the Office of the Solicitor General (OSG)
argues that in pursuing a case against one who
undermines the integrity of the CSC examinations, the
CSC Caraga was only acting within its mandated powers
and duties. The OSG clarifies that the PNP does not have
exclusive jurisdiction over disciplinary cases. Rather, its
jurisdiction over such cases is concurrent with that of the
CSC. It also argues that Civil Service Commission v. Court of
Appeals[25] is irrelevant to petitioner's situation because
the ruling therein does not affect the authority of the CSC
to conduct the CSP examination and to investigate
examination anomalies. Lastly, the OSG contends that
petitioner should not have directly resorted to court
action, because the CSC proper could still review the
decisions and actions of the CSC Caraga.[26]
Issue
The case at bar boils down to the issue of whether the
CSC Caraga has jurisdiction to conduct the preliminary
investigation of a possible administrative case of
dishonesty against PO1 Capablanca for alleged CSP
Our Ruling
The petition lacks merit.
The CSC, as the central personnel agency of the
Government, is mandated to establish a career service, to
strengthen the merit and rewards system, and to adopt
measures to promote morale, efficiency and integrity in
the civil service.[27] The civil service embraces all branches,
subdivisions, instrumentalities, and agencies of the
government, including government-owned or controlled
corporations with original charters.[28] Specifically, Section
91 of Republic Act (RA) No. 6975 (1990) or the
Department of Interior and Local Government Act of 1990
provides that the Civil Service Law and its implementing
rules and regulations shall apply to all personnel of the
Department, to which herein petitioner belongs.
Section 12 of Executive Order (EO) No. 292 or the
Administrative Code of 1987, enumerates the powers and
functions of the CSC, to wit:
SEC. 12. Powers and Functions. - The Commission
shall have the following powers and functions:
(1) Administer and enforce the constitutional and
statutory provisions on the merit system for all levels and
ranks in the Civil Service;
xxxx
(7) Control, supervise and coordinate Civil Service
examinations. x x x
xxxx
(11) Hear and decide administrative cases instituted by or
brought before it directly or on appeal, including
contested appointments, and review decisions and
actions of its offices and of the agencies attached to it. x x
x thereof for a period not exceeding fifteen (15) days;
In addition, Section 28, Rule XIV of the Omnibus Civil
Service Rules and Regulations specifically confers upon
the CSC the authority to take cognizance over any
irregularities or anomalies connected with the
examinations, thus:
Sec. 28. The Commission shall have original disciplinary
jurisdiction over all its officials and employees and over all
cases involving civil service examination anomalies or
irregularities.
To carry out this mandate, the CSC issued Resolution No.
991936, or the Uniform Rules on Administrative Cases in
the Civil Service, empowering its Regional Offices to take
cognizance of cases involving CSC examination anomalies:
SECTION 6. Jurisdiction of Civil Service Regional Offices. -
The Civil Service Commission Regional Offices shall have
jurisdiction over the following cases:
A. Disciplinary
1. Complaints initiated by, or brought before, the Civil
Service Commission Regional Offices provided that the
alleged acts or omissions were committed within the
jurisdiction of the Regional Office, including Civil Service
examination anomalies or irregularities and the persons
complained of are employees of agencies, local or
national, within said geographical areas;
xxxx
Based on the foregoing, it is clear that the CSC acted
within its jurisdiction when it initiated the conduct of a
preliminary investigation on the alleged civil service
examination irregularity committed by the petitioner.
However, petitioner contends that a citizen who has
complaints against a police officer should bring his
complaint before the following, citing Section 41 of RA
6975,[29] to wit:
(a) x x x x
(1) Chiefs of police, where the offense is punishable by
withholding of privileges, restriction to specified limits,
suspension or forfeiture of salary, or any combination
(2) Mayors of cities or municipalities, where the offense is
punishable by withholding of privileges, restriction to
specified limits, suspension or forfeiture of salary, or any
combination thereof, for a period of not less than sixteen
(16) days but not exceeding thirty (30) days;
(3) People's Law Enforcement Board, as created under
Section 43 hereof, where the offense is punishable by
withholding of privileges, restriction to specified limits,
suspension or forfeiture of salary, or any combination
thereof, for a period exceeding thirty (30) days; or by
dismissal.
xxxx
(c) Exclusive Jurisdiction. - A complaint or a charge filed
against a PNP member shall be heard and decided
exclusively by the disciplining authority who has acquired
original jurisdiction over the case and notwithstanding the
existence of concurrent jurisdiction as regards the offense:
Provided, That offenses which carry higher penalties
referred to a disciplining authority shall be referred to the
appropriate authority which has jurisdiction over the
offense.
Based on the foregoing, petitioner avers that the CSC does
not have the authority to conduct an initiatory
investigation of the case, but it only has appellate
jurisdiction to review the decision of any of the disciplining
authorities above mentioned. Petitioner anchors his
argument on the following provisions of EO 292 stating
that the heads of departments, agencies, offices or
bureaus should first commence disciplinary proceedings
against their subordinates before their decisions can be
reviewed by the CSC:
Section 47, Book V of EO 292:
Disciplinary Jurisdiction. - (1) The Commission shall decide
upon appeal all administrative disciplinary cases involving
the imposition of a penalty of suspension for more than
thirty days, or fine in an amount exceeding thirty days'
salary, demotion in rank or salary or transfer, removal or
dismissal from office x x x
(2) The Secretaries and heads of agencies and
instrumentalities, provinces, cities and municipalities shall
have jurisdiction to investigate and decide matters
involving disciplinary action against officers and
employees under their jurisdiction. Their decisions shall be
final in case the penalty imposed is suspension for not
more than thirty days or fine in an amount not exceeding
thirty days' salary. In case the decision rendered by a
bureau or office head is appealable to the Commission,
the same may be initially appealed to the department and
finally to the Commission and pending appeal, the same
shall be executory except when the penalty is removal, in
which case the same shall be executory only after
confirmation by the Secretary concerned.
Section 48, Book V of EO 292:
Procedure in Administrative Cases Against Non-
Presidential Appointees. - (1) Administrative proceedings
may be commenced against a subordinate officer or
employee by the Secretary or head of office of equivalent
rank, or head of local government, or chiefs of agencies,
or regional directors, or upon sworn, written complaint of
any other person.
We are not persuaded. It has already been settled
in Cruz v. Civil Service Commission[30] that the appellate
power of the CSC will only apply when the subject of the
administrative cases filed against erring employees is in
connection with the duties and functions of their office,
and not in cases where the acts of complainant arose
from cheating in the civil service examinations.Thus:
Petitioners invocation of the law is misplaced. The
provision is applicable to instances where administrative
cases are filed against erring employees in connection
with their duties and functions of the office. This is,
however, not the scenario contemplated in the case at
bar. It must be noted that the acts complained of arose
from a cheating caused by the petitioners in the Civil
Service (Subprofessional) examination. The examinations
were under the direct control and supervision of the Civil
Service Commission. The culprits are government
employees over whom the Civil Service Commission
undeniably has jurisdiction. x x x
Moreover, in Civil Service Commission v. Albao,[31] we
rejected the contention that the CSC, under the
aforestated Sections 47 and 48 of Book V of EO 292, only
has appellate disciplinary jurisdiction on charges of
dishonesty and falsification of documents in connection
with an appointment to a permanent position in the
government service. We enunciated, thus:
Pursuant to Section 47 (1), (2) and Section 48 above, it is
the Vice President of the Philippines, as head of office,
who is vested with jurisdiction to
commence disciplinary action against respondent Albao.
Nevertheless, this Court does not agree that petitioner is
helpless to act directly and motu proprio, on the alleged
acts of dishonesty and falsification of official document
committed by respondent in connection with his
appointment to a permanent position in the Office of the
Vice President.
It is true that Section 47 (2), Title I (A), Book V of EO No.
292 gives the heads of government offices
original disciplinary jurisdiction over their own
subordinates. Their decisions shall be final in case the
penalty imposed is suspension for not more than thirty
days or fine in an amount not exceeding thirty days
salary. It is only when the penalty imposed exceeds the
aforementioned penalties that an appeal may be brought
before the Civil Service Commission which has appellate
jurisdiction over the same in accordance with Section 47
(1) Title I(A), Book V of EO No. 292, thus:
SEC. 47. Disciplinary Jurisdiction. (1) The Commission shall
decide upon appeal all administrative disciplinary cases
involving the imposition of a penalty of suspension for
more than thirty days, or fine in an amount exceeding
thirty days salary, demotion in rank or salary or transfer,
removal or dismissal from office. x x x
The present case, however, partakes of an act by
petitioner to protect the integrity of the civil service
system, and does not fall under the provision on
disciplinary actions under Sec. 47. It falls under the
provisions of Sec. 12, par. 11, on administrative cases
instituted by it directly. This is an integral part of its duty,
authority and power to administer the civil service
system and protect its integrity, as provided in Article IX-
B, Sec. 3 of the Constitution, by removing from its list of
eligibles those who falsified their qualifications. This is to
be distinguished from ordinary proceedings intended to
discipline a bona fide member of the system, for acts or
omissions that constitute violations of the law or the
rules of the service. (Emphasis Ours)

Incidentally, it must be mentioned at this juncture that
citizens complaints before the PLEB under RA 6975
pertain to complaints lodged by private citizens against
erring PNP members for the redress of an injury, damage
or disturbance caused by the latter's illegal or irregular
acts, an example being that of a policeman who takes fish
from the market without paying for it.[32] Clearly, the PLEB
has no jurisdiction concerning matters involving the
integrity of the civil service system.
Finally, petitioners reliance on Civil Service Commission v.
Court of Appeals,[33] is misplaced. In said case, the
NAPOLCOM assailed Item 3 of CSC Resolution No. 96-
5487, which provides:
3. Appointees to Police Officer and Senior Police Officer
positions in the Philippine National Police must have
passed any of the following examinations:
a) PNP Entrance Examination;
b) Police Officer 3rd Class Examination; and
c) CSC Police Officer Entrance Examination.
The NAPOLCOM took exception to this provision,
particularly letter (c), arguing that the requirement of
taking a CSC Police Officer Entrance Examination is only
applicable to entrance in the first-level position in the
PNP, i.e., the rank of PO1.[34] NAPOLCOM stressed that
what would entitle a police officer to the appropriate
eligibility for his promotion in the PNP are the
promotional examinations conducted by the NAPOLCOM,
and not the CSC Police Officer Entrance Examination.
for the positions of Police Officer as well as that of Senior
Police Officer, meaning examination not only for
appointment to PO1 but promotion to PO2 and PO3 up to
the four SPO ranks.[36]
The Court of Appeals thus ordered the CSC to desist from
conducting any promotional examination for Police
Officers and Senior Police Officers.
In a Minute Resolution dated September 25, 2001 in G.R.
No. 141732, we affirmed the Court of Appeals thereby
sustaining the authority of the NAPOLCOM to administer
promotional examinations for policemen.
It must be stressed however that the subject matter in the
above cited case was the conduct of promotional
examination for policemen. On the contrary, the issue in
the instant case is the jurisdiction of the CSC with regard
to anomalies or irregularities in the CSP-CAT, which is a
totally different matter.
In fine, we find that CSC Caraga acted within its powers
when it instituted the conduct of a preliminary
investigation against herein petitioner. In view of the
foregoing, we need not anymore attend to the issue of
the doctrine of exhaustion of administrative remedies.
WHEREFORE, the petition is DENIED for lack of merit.
SO ORDERED.

The Court of Appeals found in favor of the NAPOLCOM

and held that the CSC, by issuing Item 3 of CSC Resolution
No. 96-5487 encroached on the exclusive power of
NAPOLCOM under RA 6975[35] to administer promotional
examinations for policemen and to impose qualification
standards for promotion of PNP personnel to the ranks of
PO2 up to Senior Police Officers 1-4.Thus:

Admittedly, the CSC is mandated to conduct the qualifying

entrance examination (CSC Police Officer Entrance
Examination) for Police Officer 1. However, when the CSC
prescribes the same examination for appointment of
Senior Police Officer (SPO) under the questioned Item 3, it
in effect imposes an examination for promotion
(appointment) of a policeman to PO2 up to other higher
ranks up to SP04. Thus Item 3 encompasses examinations
OVEN YUKI, JR., G.R. No. 178527
Petitioner,
Present:
CARPIO,* J., Chairperson,
- versus - LEONARDO-DE
CASTRO,**
BRION,
DEL CASTILLO, and
ABAD, JJ.
WELLINGTON CO, Promulgated:
Respondent. November 27, 2009
x---------------------------------------------
----------------------x
DECISION
DEL CASTILLO, J.:
The lessee-petitioners attempt to hold on to the
property subject of the instant unlawful detainer case, by
resorting to fraudulent machinations such as refusing to
receive the notices to vacate, must not be
countenanced. His stubborn refusal to receive the
notices to vacate should not prejudice the right of the
lessor-respondent, to use and enjoy the fruits of his
property.
This Petition for Review on Certiorari[1] assails
the November 23, 2008 Decision[2] of the Court of
Appeals (CA) in CA-G.R. SP No. 89228 granting
respondents Petition for Review[3] and setting aside the
March 7, 2005 Decision[4] of the Regional Trial Court
(RTC), Branch 14, Manila. The RTC reversed and set aside
the Decision[5] dated September 21, 2004 of the
Metropolitan Trial Court (MeTC), Branch 15, Manila,
granting respondents Complaint for unlawful
detainer[6] and ordering petitioner to vacate the
premises subject matter of this case.
Factual Antecedents
Mr. Joseph Chua was the registered owner of a parcel of
land, together with a commercial building erected
thereon, situated at the corner of Espaa and Instruccion
Sts., Sampaloc, Manila. In 1981, he leased a portion of
the building to petitioner Joven Yuki, Jr., who put up a
business therein under the name and style Supersale
Auto Supply. The contract of lease between Mr. Chua
and petitioner had a term of five years but was not
reduced into writing. Thereafter, the lease was renewed
through a series of verbal and written agreements,[7] the
last of which was a written Contract of Lease[8] covering
the period of January 1, 2003 to December 31, 2003 at a
monthly rental of P7,000.00.
In November 2003, Mr. Chua informed petitioner that
he sold the property to respondent Wellington Co and
instructed petitioner to thenceforth pay the rent to the
new owner.
Proceedings before the Metropolitan Trial Court
After the expiration of the lease contract, petitioner
refused to vacate and surrender the leased
premises. Thus, respondent filed a Complaint for
unlawful detainer[9] before the MeTC of Manila. The
material allegations of the complaint read as follows:
xxxx
3. Plaintiff [herein respondent] is the registered owner of
that parcel of land together with the building existing
thereon situated at 2051 Espaa St. cor. Instruccion St.,
Sampaloc, Manila. Plaintiffs title to said property is
evidenced by the Transfer Certificate of Title No. 261682
of the Registry of Deeds of Manila, photocopy of which is
attached hereto as Annex A and the tax declarations for
the lot and improvement are attached hereto as
Annexes B and B-1, respectively;
xxxx
5. Prior to the sale of the lot and building by the previous
owner to herein plaintiff, Joseph Chua sent a notice to
defendant [herein petitioner] informing him that the
property is for sale giving the defendant the opportunity
to exercise his pre-emptive right. Copy of said Notice is
attached hereto as Annex D;
6. Defendant waived his right to exercise his pre-emptive
right and the real property was eventually sold to herein
plaintiff;
7. Plaintiff, being the new owner of the lot and building,
informed defendant that his Contract of Lease with the
former lessor-owner Joseph Chua will no longer be
renewed as per letter dated November 3, 2003, copy of
which was left at defendants store, for his refusal to
acknowledge the receipt of the same. A copy of said
Notice is attached hereto and made an integral part
hereof as Annex E;
8. For failure and refusal of the defendant to vacate and
surrender the leased unit to plaintiff, plaintiffs counsel in
turn sent a formal demand upon defendant to vacate
the leased premises within ten (10) days from receipt of
the formal demand in view of the expiration of the
contract of lease. Copy of said letter dated January 13,
2004 is attached hereto as Annex F. A copy was sent by
registered mail but defendant failed to claim the same as
evidenced by the Certification from the Central Post
Office, copy of which is attached hereto as Annex
G. Another copy of the same demand letter was
personally served at defendants address as attested by
the sworn statement of Wilberto Co who served the said
formal demand as well as the notice earlier sent by
plaintiff. Copy of the Affidavit of Wilberto Co is attached
hereto as Annex H;
xxxx
Respondent prayed that petitioners possession of
subject premises be declared unlawful and that
petitioner be ordered to vacate it. He also sought
reasonable compensation for the use of the property
until such time that it is surrendered to him and for the
petitioner to pay him moral damages and attorneys fees.
In his Answer with Counterclaim,[10] petitioner denied
having been served with copies of the alleged notice of
sale and notice to vacate. By way of affirmative defenses,
he claimed that the complaint should be dismissed for
being premature as there was no allegation therein of
prior referral to the barangay. Petitioner also asserted
that since he was not notified by the former owner of
the sale, he was deprived of his preemptive
rights. Moreover, respondent has no cause of action
against him because respondent is not the true owner of
the property but merely acts as a representative of
persons whom respondent refused to disclose. Further,
petitioner argued that there was an implied renewal of
lease considering that a) he did not receive a notice to
vacate, b) the two months deposit and one month
advance payment he gave to Mr. Chua were never
returned to him, and c) respondent accepted his
payments for the months of January and February 2004.
Petitioner also asserted that his property rights would be
violated if he is evicted because he has been operating
his business in the premises for more than 20 years and
has established goodwill in the area. He thus proposed
that he be compensated the amount of not less than P1
million or be allowed to dispose of his stocks within a
reasonable period of time, before he vacates the
premises.
On September 21, 2004, the MeTC-Branch 15 rendered
a Decision[11] in favor of the respondent, the dispositive
portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of
the plaintiff and against the defendant ordering the
defendant and all persons claiming right under him:
1. to VACATE and surrender the subject property
peacefully to plaintiff;
2. to PAY the plaintiff reasonable compensation
for the use and occupancy of the subject premises in the
amount of eight thousand (P8,000.00) pesos per month
from January 1, 2004 until such time that he and all
persons claiming rights under him have fully vacated the
premises;
3. to PAY the plaintiff thirty thousand (P30,000.00)
pesos as attorneys fees and litigation expenses.
SO ORDERED.[12]
Proceedings before the Regional Trial Court
In time, petitioner went on appeal to the RTC contending
that
A. THE LOWER COURT ERRED WHEN IT RULED THAT
THE PLAINTIFF-APPELLEE [herein respondent] HAD A
CAUSE OF ACTION TO EVICT HEREIN DEFENDANT-
APPELLANT [herein petitioner] FROM THE PREMISES.
B. THE LOWER COURT ERRED WHEN IT RULED
THAT THERE WAS NO IMPLIED NEW LEASE CREATED BY
PLAINTIFF-APPELLEES ACCEPTANCE OF THE RENTALS
MADE BY DEFENDANT-APPELLANT.
C. THE LOWER COURT ERRED WHEN IT RULED
THAT VALID NOTICE [TO] VACATE WAS SERVED UPON
DEFENDANT-APPELLANT BY THE PLAINTIFF-APPELLEE.
D. THE LOWER COURT GRAVELY ERRED WHEN IT
RULED THAT DEFENDANT-APPELLANT WAS NOT DENIED
HIS PREEMPTIVE RIGHT TO PURCHASE THE PROPERTY
HE HAS BEEN OCCUPYING.
E. THE LOWER COURT GRAVELY ERRED WHEN IT
DENIED THE MOTION FOR CLARIFICATORY HEARING
FILED BY DEFENDANT-APPELLANT AS WELL AS HAVING
DENIED THE MOTION FOR VOLUNTARY INHIBITION.
F. THE LOWER COURT ERRED WHEN IT AWARDED
ATTORNEYS FEES AMOUNTING TO THIRTY THOUSAND
(P30,000.00) IN FAVOR OF PLAINTIFF-APPELLEE.
On March 7, 2005, the RTC-Branch 14 rendered a
Decision[13] with the following disposition:
WHEREFORE, all premises considered, the Court finds
and so holds preponderance of evidence on the part of
the defendant-appellant. Accordingly, the Decision
appealed from is hereby REVERSED, and the complaint
for Unlawful Detainer is dismissed.
Finally, there is on record a defendant-appellants Motion
for Reconsideration as regards the amount of the
supersedeas bond. By the dismissal of the case, the
resolution thereof is thereby rendered moot and
academic.
SO ORDERED.[14]
In reversing the ruling of the MeTC, the RTC found no
proof on record that petitioner actually received the
notice to vacate, thereby making the Complaint fatally
defective. The RTC likewise opined that the resolution of
the case hinges on the existence of implied new lease, a
question which is incapable of pecuniary estimation and,
therefore, beyond the MeTCs jurisdiction.
Proceedings before the Court of Appeals
Respondent filed with the CA a Petition for
Review[15] under Rule 42 of the Rules of Court assailing
the RTC Decision. On November 23, 2006, the CA
promulgated the now assailed Decision[16] granting the
petition. Its fallo reads:
WHEREFORE, the instant petition is hereby
GRANTED. The Decision dated 7 March 2005 rendered
by the Regional Trial Court (RTC) of Manila, Branch 14 is
SET ASIDE and the Decision dated 21 September 2004 of
the Metropolitan Trial Court (MeTC) of Manila, Branch
15 is REINSTATED.
SO ORDERED.[17]
Issues
Petitioner interposed the present recourse imputing
upon the CA the following errors:
A. x x x THE COURT OF APPEALS COMMITTED
GRAVE ERROR WHEN IT RULED NOT TO DISMISS THE
PETITION INTERPOSED BY RESPONDENT AND INSTEAD
PROCEEDED TO REVERSE THE DECISION DATED MARCH
7, 2005 OF THE REGIONAL TRIAL COURT, BRANCH 14
DESPITE RESPONDENT (THEN PETITIONER) HAVING
FAILED TO COMPLY WITH THE PROCEDURAL
REQUIREMENTS UNDER RULE 42 OF THE 1997 RULES OF
CIVIL PROCEDURE.[18]
B. THE COURT OF APPEALS ERRED WHEN IT FOUND
ERRORS COMMITTED BY THE RTC IN REVERSING THE
DECISION OF THE MTC.[19]
Our Ruling
The petition lacks merit.
The allegations in respondents petition are supported by
material portions of the record.
Petitioner contends that the Petition for Review[20] filed
by the respondent with the CA is procedurally infirmed
and that the appellate court should have outrightly
dismissed the same. Specifically, petitioner points out
that while respondent attached to the petition the
parties respective position papers, he failed to attach to
said position papers the annexes thereto. This, petitioner
insists, warrants the dismissal of respondents petition
per Section 2, Rule 42 of the Rules of Court,[21] in relation
to Section 3[22] of the same Rule.
We do not agree. Section 2 of Rule 42 does not require
that all the pleadings and documents filed before the
lower courts must be attached as annexes to the
petition. Aside from clearly legible duplicate originals or
true copies of the judgments or final orders of both
lower courts, it merely requires that the petition be
accompanied by copies of pleadings and other material
portions of the record as would support the allegations
of the petition. As to what these pleadings and material
portions of the record are, the Rules grants the
petitioner sufficient discretion to determine the
same. This discretion is of course subject to CAs
evaluation whether the supporting documents are
sufficient to make out a prima facie case.[23] Thus,
Section 3 empowers the CA to dismiss the petition
where the allegations contained therein are utterly
bereft of evidentiary foundation. Since in this case the CA
gave due course to respondents Petition for Review and
proceeded to decide it on the merits, it can be fairly
assumed that the appellate court is satisfied that
respondent has sufficiently complied with Section 2 of
Rule 42.
Besides, our own examination of the CA rollo reveals
that the annexes to the position papers can be found
somewhere else in the petition. The annexes to the
parties respective position papers are the same annexes
attached to the Complaint and the Answer. In fact,
Annexes A to H of the Complaint respectively pertain to
the same documents marked as Annexes A to H of
respondents Position Paper. And while respondents
Position Paper as attached to the petition does not
contain any annexes, said annexes are nonetheless
appended to the Complaint which is also attached to the
petition.
The same is true with Annexes 1 to 6 of petitioners
Position Paper. Annexes 1, 2, and 3 are attached to the
Petition for Review as Annexes 3, 4, and 5, respectively,
of the Answer.Annex 4 of petitioners Position Paper is
the Contract of Lease marked as Annex C of the
Complaint, while Annexes 5 and 6 are marked and
attached as Annexes 1 and 2, respectively, of the
Answer. To our mind, these are more than substantial
compliance with the requirements of the rules. Indeed, if
we are to apply the rules of procedure in a very rigid and
technical sense as what the petitioner suggests in this
case, the ends of justice would be defeated. In Lanaria v.
Planta,[24] we emphasized that courts should not be so
strict about procedural lapses that do not really impair
the proper administration of justice, for rules of
procedure are intended to promote, and not to defeat,
substantial justice.[25]
Allegations of implied new
lease or tacita reconduccion cannot oust the MeTC of
jurisdiction over unlawful detainer cases.
Petitioner also contends that the CA grievously erred in
reversing the Decision of the RTC. He maintains that the
RTC correctly held that the key issue to be resolved in
this case is the existence of an implied new lease, a
matter which is incapable of pecuniary estimation and,
therefore, beyond the MeTCs jurisdiction.
The argument is bereft of merit. The allegation of
existence of implied new lease or tacita
reconduccion will not divest the MeTC of jurisdiction
over the ejectment case. It is an elementary rule that the
jurisdiction of the court in ejectment cases is determined
by the allegations pleaded in the complaint[26] and
cannot be made to depend upon the defenses set up in
the answer or pleadings filed by the defendant.[27] This
principle holds even if the facts proved during trial do not
support the cause of action alleged in the
complaint.[28] In connection with this, it is well to note
that in unlawful detainer cases the elements to be
proved and resolved are the facts of lease and expiration
or violation of its terms.[29]
Here, no interpretative exercise is needed to conclude
that respondent has complied with such requirement. In
respondents Complaint, he specifically alleged that (1)
the former owner, Mr. Chua, and petitioner entered into
a contract of lease; (2) subsequently, respondent
purchased the leased premises from Mr. Chua and
became the owner thereof; (3) thereafter, the lease
contract between Mr. Chua and petitioner expired; and
(4) petitioner refused to vacate the premises despite the
expiration and non-renewal of the lease.
Besides, we do not agree with the RTC that the MeTC
does not have jurisdiction to resolve the issue of
existence of implied new lease in the unlawful detainer
case. Tacita reconduccion refers to the right of the lessee
to continue enjoying the material or de facto possession
of the thing leased within a period of time fixed by
law. During its existence, the lessee can prevent the
lessor from evicting him from the disputed premises. On
the other hand, it is too well-settled to require a citation
that the question to be resolved in unlawful detainer
cases is, who is entitled to de facto possession.
Therefore, since tacita reconduccion is determinative of
who between the parties is entitled to de
facto possession, the MeTC has jurisdiction to resolve
and pass upon the issue of implied new lease in unlawful
detainer case. In Mid-Pasig Land Development
[30]
Corporation v. Court of Appeals, we ruled that the
MeTC is clothed with exclusive original jurisdiction over
an unlawful detainer case even if the same would entail
compelling the plaintiff therein to recognize an implied
lease agreement.
Respondent did not acquiesce to petitioners continued
possession of subject premises.
Petitioner likewise claims that the RTC correctly held that
there was no sufficient evidence on record that he
received the alleged notice to vacate. While he admits
that a notice to vacate is no longer necessary when the
ground for unlawful detainer is the expiration of the
lease, proof that he actually received said notice is still
important in this case in view of his allegation of implied
new lease. Citing Article 1670 of the Civil
Code,[31] petitioner contends that if at the expiration of
the contract of lease the lessee continued to enjoy the
leased property for 15 days with the acquiescence of the
lessor, there is an implied new lease. In this case, the
determination of whether or not his continued stay in
the leased premises is with the acquiescence of the
lessor hinges on whether or not he received the notice
to vacate. And, as correctly found by the RTC, he did not
receive any notice to vacate.
We are not swayed. Under Article 1670, an implied new
lease will set in if it is shown that: (a) the term of the
original contract of lease has expired; (b) the lessor has
not given the lessee a notice to vacate; and (c) the lessee
continued enjoying the thing leased for 15 days with the
acquiescence of the lessor. This acquiescence may be
inferred from the failure of the lessor to serve notice to
vacate upon the lessee.[32]
In the instant case, however, the MeTC and the CA
correctly found that there was a valid demand to
vacate. Thus:
Prior to the sale of the property by previous owner
Joseph Chua to herein plaintiff, defendant was formally
notified by the previous owner in a letter dated
September 1, 2003 (Annex D of Complaint, Records, p.
12) of his intention to sell the property but herein
defendant failed to exercise his pre-emptive right to
purchase the property.
Thus, the subject premises was sold to plaintiff who
became the registered owner thereof as evidenced by
TCT No. 261682 (Annex A, Complaint, Records, p.
7). Plaintiff, as new owner/vendee, informed defendant
through a letter dated November 3, 2003 (Annex E,
Complaint, Records, p. 13), even prior to the expiration
of the contract that he will be needing the premises thus
the contract will not be renewed or no contract will be
executed, and directed defendant to vacate the
premises by January 1, 2004. The said notice was sent by
registered mail and by personal service. The notice sent
by registered mail was returned to sender for failure of
the defendant to claim the same at the post office. The
unclaimed letter is attached to the plaintiffs position
paper as Annex F (Records, p. 93). Despite notice given
to him, defendant failed to vacate and a formal demand
letter dated January 13, 2004 was served to him
personally on January 21, 2004 which he refused to
acknowledge that he received the same. A copy of that
same letter was sent by registered mail but defendant
refused to claim the same for which it was returned to
sender. The unclaimed letter which was returned to
sender is attached to the plaintiffs position paper as
Annex G-1 (Records, p. 96) and the certification from the
post office attesting to the fact that defendant failed to
claim the same is attached to the plaintiffs position
paper as Annex G (Records, p. 95). The demand letter
dated January 13, 2004 pertains to the premises
presently occupied by defendant. The Contract of Lease
(Annex C, of Complaint, Records, pp. 10-11) which
expired on December 31, 2003 speaks of only one (1)
unit which is the subject matter of this case. Defendant
failed to show that the portion being occupied by him
which is the subject matter of this case is covered by
another lease contract.
The Court therefore finds that there was a valid demand
to vacate.[33]
This finding of the MeTC, which was affirmed by the CA,
is a factual matter that is not ordinarily reviewable in a
petition for review on certiorari filed under Rule 45 of
the Rules of Court. It is settled that in a petition for
review on certiorari, only questions of law may be raised
by the parties and passed upon by this court.
Besides, even if we do review the case, there is no
cogent reason to disturb the finding of said courts. Under
the rules, if the addressee refuses to accept delivery,
service by registered mail is deemed complete if the
addressee fails to claim the mail from the postal office
after five days from the date of first notice of the
postmaster.[34] Further, the absence of personal service
of notice to vacate in this case could only be attributed
to petitioners unexplainable refusal to receive the
same. In Co Keng Kian v. Intermediate Appellate
Court,[35] we held that [t]he Court cannot countenance
an unfair situation where the plaintiff in an eviction case
suffers further injustice by the unwarranted delay
resulting from the obstinate refusal of the defendant to
acknowledge the existence of a valid demand.
The formal demands to vacate sent to petitioner,
coupled with the filing of an ejectment suit, are
categorical acts on the part of respondent showing that
he is not amenable to another renewal of the lease
contract. Therefore, petitioners contention that his stay
in the subject premises is with the acquiescence of the
respondent, has no leg to stand on.
Petitioners alleged preferential right to buy subject
premises has no basis.
In view of the above disquisition, petitioners claim that
he was deprived of his preemptive rights because he was
not notified of the intended sale, likewise
crumbles. Besides, the right of first refusal, also referred
to as the preferential right to buy, is available to lessees
only if there is a stipulation thereto in the contract of
lease or where there is a law granting such right to them
(i.e., Presidential Decree No. 1517 (1978),[36] which vests
upon urban poor dwellers[37] who merely lease the
house where they have been residing for at least ten
years, preferential right to buy the property located
within an area proclaimed as an urban land reform
zone). Unlike co-owners and adjacent lot
[38]
owners, there is no provision in the Civil Code which
grants to lessees preemptive rights. Nonetheless, the
parties to a contract of lease may provide in their
contract that the lessee has the right of first refusal.
In this case, there is nothing in the Contract of Lease
which grants petitioner preferential right to buy the
subject premises. We are likewise unaware of any
applicable law which vests upon him priority right to buy
the commercial building subject matter of this case. In
fact, aside from the sweeping statement that his
preferential right to buy was violated, petitioner failed to
cite in his Petition,[39] Reply,[40] or Memorandum[41] any
specific provision of a law granting him such right. In
other words, petitioner failed to lay the basis for his
claim that he enjoys a preferential right to buy.
And even assuming that he has, the same will not
prevent the ejectment case filed by the respondent from
taking its due course. A contract of sale entered into in
violation of preemptive right is merely rescissible and the
remedy of the aggrieved party whose right was violated
is to file an appropriate action to rescind the sale and
compel the owner to execute the necessary deed of sale
in his favor. In Wilmon Auto Supply Corp. v. Court of
Appeals,[42] we categorically held that an action for
unlawful detainer cannot be abated or suspended by an
action filed by the defendant-lesseee to judicially enforce
his right of preemption.
WHEREFORE, the petition is DENIED.
SO ORDERED.
METROPOLITAN BANK & G.R. No. 170906 On March 6, 1998, respondent Lamb Construction
TRUST CO., Consortium Corporation obtained a P5.5 million loan from
Petitioner, Present: petitioner Metropolitan Bank & Trust Co., subject to 18%
interest per annum.[8] To secure the loan, respondent
CARPIO,* J., executed a Real Estate Mortgage[9] in favor of petitioner
- versus - Chairperson, involving six parcels of land covered by Transfer
LEONARDO-DE CASTRO,** Certificates of Title Nos.
BRION, [10] [11] [12]
101233, 101234, 101235, 101236, 101238, a [13] [14]

LAMB CONSTRUCTION DEL CASTILLO, and nd 101248.[15]

CONSORTIUM ABAD, JJ. Respondent failed to pay the loan upon maturity hence
CORPORATION, petitioner filed a petition for the extra-judicial foreclosure
represented by Victor T. of the said properties. During the auction sale held
Nubla and on January 27, 2000, petitioner emerged as the highest
Edgardo C. Santos, Promulgated: bidder with the bid amount of P6,669,765.75 and was
Respondent. November 27, 2009 accordingly issued a Certificate of Sale.
x----------------------------------------------
------------x Proceedings before the Regional Trial Court

DECISION On June 23, 2000 and during the period of redemption,

DEL CASTILLO, J.:
A petition for the issuance of a writ of possession is ex
parte, non-adversarial, and summary in nature because
the only issue involved is the purchasers right to
possession. In fact, Section 7 of Act 3135
(1924)[1] expressly provides that it is the ministerial duty of
the cadastral court to issue a writ of possession in favor of
the purchaser even during the redemption period, unless
the case falls under the exceptions provided by law[2] and
jurisprudence.[3] As a rule, mere inadequacy or surplus in
the purchase price does not affect the purchasers
entitlement to a writ of possession. In case there is a
surplus, the mortgagor is entitled to receive the same
from the purchaser. The failure or refusal of the
mortgagee-purchaser to return the surplus does not
affect the validity of the sale but gives the mortgagor a
cause of action against the mortgagee-purchaser.
This Petition for Review[4] on Certiorari, under Rule 45 of
the Rules of Court, seeks to set aside the September 12,
2005 Decision[5] of the Court of Appeals (CA) in CA-G.R. CV
No. 72240, insofar as it ordered petitioner to pay
respondent the excess of the bid price in the amount
of P488,289.35 with legal interest from January 27, 2000
until it is fully paid. Likewise assailed is the CAs December
12, 2005 Resolution[6] denying petitioners Motion for
Partial Reconsideration.[7]
Factual antecedents
petitioner filed a verified petition for issuance of a writ of
possession. Petitioner alleged that notwithstanding its
demands, respondent refused and failed to turn over
actual possession of the foreclosed properties. The case
was docketed as LRC Case No. 00-0096 and raffled to
Branch 257 of the Regional Trial Court (RTC)
of Paraaque City. While the petition was pending with the
trial court, respondent redeemed the property covered by
Transfer Certificate of Title No. 101234.[16]
On May 25, 2001, the RTC rendered a Decision[17] denying
petitioners application for the issuance of a writ of
possession because it failed to deposit the surplus
proceeds from the foreclosure sale. It ruled that:
While the outstanding obligation of the corporation as
of August 25, 1999 is P5,251,705.67 (Exh. C), the property
was sold at public auction for P6,669,756.75 on January
27, 2000. Under the law, the buyer of the property is
obligated to pay the contract price of P6,669,756.75 less
the obligation of P5,251,705.67. Hence, the purchaser of
the property should still pay the auctioneer the amount
of P1,418,060.08. x x x
Metropolitan Bank and Trust Co. has obligation to pay the
amount of P1,418,060.08, which is the difference of the
purchase price to the outstanding obligation. Since the
outstanding obligation as of August 25, 1999 was
only P5,251,705.67 while the purchase price
is P6,669,765.75, the highest bidder of the property is still
obligated to pay the price difference
of P1,418,060.08. The amount should be deposited at the
Office of the Clerk of Court in trust for the mortgagor.
WHEREFORE, for failure of petitioner to deposit the
amount of P1,418,060.08 to the Clerk of Court in trust for
[the] mortgagor, the petition for writ of possession is
DENIED.
SO ORDERED.[18]
Petitioner moved for reconsideration but the same was
denied in an Order dated July 18, 2001.[19]
Proceedings before the Court of Appeals
The CA ruled that petitioner is entitled to a writ of
possession, the issuance of which is ministerial upon the
court.[20] At the same time, the appellate court ruled that
petitioner is also obliged to return the excess of the bid
price over the outstanding obligation, since the
application of the proceeds from the sale of the
mortgaged property to the mortgagors obligation is an act
of payment, not payment by dation. It then found
imperative that an assessment of the total outstanding
debt be made in order to resolve whether there was any
surplus proceeds which must be returned to
respondent. Thus, based on its computation, the
appellate court held that petitioner must deliver to
respondent the surplus proceeds of P488,289.35.[21]
The CA disposed of the case in this wise:
WHEREFORE, the foregoing considered, the appeal is
GRANTED and the assailed Decision REVERSED and SET
ASIDE. Let [a] writ of possession issue against respondent.
Accordingly, petitioner is ordered to pay respondent,
through the notary public, the excess of its bid price in the
sum of P488,289.35 with legal interest from 27 January
2000 until it is paid, which amount represents the balance
of the obligation as well as interest and penalty charges at
the time of foreclosure sale.
SO ORDERED.[22]
Dissatisfied, petitioner filed a Motion for Partial
Reconsideration[23] which was denied by the CA in
its December 12, 2005 Resolution.[24]
Issues
Hence, the instant recourse, where petitioner interposes
that:
THE COURT A QUO HAS DEPARTED FROM THE USUAL
COURSE OF PROCEEDING OR SANCTIONED SUCH
DEPARTURE BY THE LOWER COURT IN THAT THE
PROCEEDINGS IN A PETITION FOR ISSUANCE OF WRIT OF
POSSESSION FILED IN ACCORDANCE WITH ACT NO. 3135,
AS AMENDED DOES NOT REQUIRE THE PRESENTATION
OF EVIDENCE INSOFAR AS THE EXCESS, IF ANY, OF THE
PURCHASE PRICE IS CONCERNED, NOR IS IT AN ISSUE IN
THE SAME CASE.
THE COURT A QUO HAS DECIDED A QUESTION IN A WAY
NOT IN ACCORD WITH LAW OR WITH THE APPLICABLE
DECISIONS OF THE HON. SUPREME COURT WHEN IT
OVERLOOKED THE FACT THAT NO OTHER MATTER MAY
BE PASSED UPON BY THE LOWER COURT EXCEPT TO
HAVE THE WRIT OF POSSESSION ISSUED AND
IMPLEMENTED.[25]
In essence, petitioner argues that in a petition for the
issuance of a writ of possession, it is improper for the RTC
and the CA to rule upon the surplus or excess of the
purchase price because the only issue that must be
resolved is the purchasers entitlement to the
writ. According to petitioner, if there is any surplus or
excess, the remedy of the respondent is to file an
independent action for collection of surplus.
Our Ruling
The petition is meritorious.
As a general rule, the issuance of a writ of possession is
ministerial. Nevertheless, in Sulit v. Court of Appeals, we
withheld the issuance of the writ considering the peculiar
circumstances prevailing in said case.
In Sulit v. Court of Appeals,[26] we withheld the issuance of
a writ of possession because the mortgagee failed to
deliver the surplus from the proceeds of the foreclosure
sale which is equivalent to approximately 40% of the total
mortgage debt. Sulit was considered as an exception to
the general rule that it is ministerial upon the court to
issue a writ of possession even during the period of
redemption. We explained that equitable considerations
prevailing in said case demand that a writ of possession
should not issue. Thus:
The governing law thus explicitly authorizes the purchaser
in a foreclosure sale to apply for a writ of possession
during the redemption period by filing an ex parte motion
under oath for that purpose in the corresponding
registration or cadastral proceeding in the case of
property with Torrens title. Upon the filing of such motion
and the approval of the corresponding bond, the law also
in express terms directs the court to issue the order for a
writ of possession.
No discretion appears to be left to the court. Any question
regarding the regularity and validity of the sale, as well as
the consequent cancellation of the writ, is to be
determined in a subsequent proceeding as outlined in
Section 8, and it cannot be raised as a justification for
opposing the issuance of the writ of possession since,
under the Act, the proceeding for this is ex parte. Such
recourse is available to a mortgagee, who effects the
extrajudicial foreclosure of the mortgage, even before the
expiration of the period of redemption provided by law
and the Rules of Court.
The rule is, however, not without exception. Under
Section 35, Rule 39 of the Rules of Court, which is made
applicable to the extrajudicial foreclosure of real estate
mortgages by Section 6 of Act 3135, the possession of the
mortgaged property may be awarded to a purchaser in
the extrajudicial foreclosure unless a third party is actually
holding the property adversely to the judgment debtor.
Thus, in the case of Barican, et al. vs. Intermediate
Appellate Court, et al., this Court took into account the
circumstances that long before the mortgagee bank had
sold the disputed property to the respondent therein, it
was no longer the judgment debtor who was in
possession but the petitioner spouses who had assumed
the mortgage, and that there was a pending civil case
involving the rights of third parties. Hence, it was ruled
therein that under the circumstances, the obligation of a
court to issue a writ of possession in favor of the
purchaser in a foreclosure of mortgage case ceases to be
ministerial.
Now, in forced sales low prices are generally offered and
the mere inadequacy of the price obtained at the sheriffs
sale, unless shocking to the conscience, has been held
insufficient to set aside a sale. This is because no
disadvantage is caused to the mortgagor. On the contrary,
a mortgagor stands to gain with a reduced price because
he possesses the right of redemption. When there is the
right to redeem, inadequacy of price becomes immaterial
since the judgment debtor may reacquire the property or
sell his right to redeem, and thus recover the loss he
claims to have suffered by reason of the price obtained at
the auction sale.
However, also by way of an exception, in Cometa, et al. vs.
Intermediate Appellate Court, et al. where the properties
in question were found to have been sold at an unusually
lower price than their true value, that is, properties worth
at least P500,000.00 were sold for only P57,396.85, this
Court, taking into consideration the factual milieu
obtaining therein as well as the peculiar circumstances
attendant thereto, decided to withhold the issuance of
the writ of possession on the ground that it could work
injustice because the petitioner might not be entitled to
the same.
The case at bar is quite the reverse, in the sense that
instead of an inadequacy in price, there is due in favor of
private respondent, as mortgagor, a surplus from the
proceeds of the sale equivalent to approximately 40% of
the total mortgage debt, which excess is indisputably a
substantial amount. Nevertheless, it is our considered
opinion, and we so hold, that equitable considerations
demand that a writ of possession should also not issue in
this case.
Rule 68 of the Rules of Court provides:
Sec. 4. Disposition of proceeds of sale. The money realized
from the sale of mortgaged property under the
regulations hereinbefore prescribed shall, after deducting
the costs of the sale, be paid to the person foreclosing the
mortgage, and when there shall be any balance or
residue, after paying off such mortgage or other
incumbrances, the same shall be paid to the junior
incumbrancers in the order of their priority, to be
ascertained by the court, or if there be no such
incumbrancers or there be a balance or residue after
payment of such incumbrancers, then to the mortgagor
or his agent, or to the person entitled to it.

The application of the proceeds from the sale of the
mortgaged property to the mortgagors obligation is an act
of payment, not payment by dation; hence, it is the
mortgagees duty to return any surplus in the selling price
to the mortgagor. Perforce, a mortgagee who exercises
the power of sale contained in a mortgage is considered a
custodian of the fund, and, being bound to apply it
properly, is liable to the persons entitled thereto if he fails
to do so. And even though the mortgagee is deemed a
trustee for the mortgagor or owner of the equity of
redemption.
Commenting on the theory that a mortgagee, when he
sells under a power, cannot be considered otherwise than
as a trustee, the vice-chancellor in Robertson vs. Norris (1
Giff. 421) observed: That expression is to be understood in
this sense: that with the power being given to enable him
to recover the mortgage money, the court requires that
he shall exercise the power of sale in a provident way,
with a due regard to the rights and interests of the
mortgagor in the surplus money to be produced by the
sale.
The general rule that mere inadequacy of price is not
sufficient to set aside a foreclosure sale is based on the
theory that the lesser the price the easier it will be for the
owner to effect the redemption. The same thing cannot
be said where the amount of the bid is in excess of the
total mortgage debt. The reason is that in case the
mortgagor decides to exercise his right of redemption.
Section 30 of Rule 39 provides that the redemption price
should be equivalent to the amount of the purchase price,
plus one percent monthly interest up to the time of the
redemption, together with the amount of any
assessments or taxes which the purchaser may have paid
thereon after purchase, and interest on such last-named
amount at the same rate.
Applying this provision to the present case would be
highly iniquitous if the amount required for redemption is
based on P7,000,000.00, because that would mean
exacting payment at a price unjustifiably higher than the
real amount of the mortgage obligation. We need not
elucidate on the obvious. Simply put, such a construction
will undeniably be prejudicial to the substantive rights of
private respondent and it could even effectively prevent
her from exercising the right of redemption.[27]
In the subsequent case of Saguan v. Philippine Bank of
Communications,[28] however, we clarified that the
exception made in Sulit does not apply when the period to
redeem has already expired or when ownership over the
property has already been consolidated in favor of the
mortgagee-purchaser. In other words, even if the
mortgagee-purchaser fails to return the surplus, a writ of
possession must still be issued. In the instant case, the
period to redeem has already lapsed. Thus, following the
ruling in Saguan, the issuance of a writ of possession in
favor of the petitioner is in order.
The failure of the mortgagee to deliver the surplus
proceeds does not affect the validity of the foreclosure
sale. It gives rise to a cause of action for the mortgagee to
file an action to collect the surplus proceeds.
Relatedly, we held in Sulit that if the mortgagee is
retaining more of the proceeds of the sale than he is
entitled to, this fact alone will not affect the validity of the
sale but simply gives the mortgagor a cause of action to
recover such surplus.[29]
In the instant case, the cadastral court is without
jurisdiction to order petitioner to deliver to respondent
the surplus or excess of the purchase price. The only issue
in a petition for the issuance of a writ of possession is the
purchasers entitlement to possession. No documentary or
testimonial evidence is even required for the issuance of
the writ as long as the verified petition states the facts
sufficient to entitle the purchaser to the relief
requested.[30] As held in Saguan, when the mortgagee-
purchaser fails to return the surplus, the remedy of a
mortgagor lies in a separate civil action for collection of a
sum of money, thus:
However, petitioners remedy lies in a separate civil action
for collection of a sum of money. We have previously held
that where the mortgagee retains more of the proceeds
of the sale than he is entitled to, this fact alone will not
affect the validity of the sale but simply gives the
mortgagor a cause of action to recover such surplus. In
the same case, both parties can establish their respective
rights and obligations to one another, after a proper
liquidation of the expenses of the foreclosure sale, and
other interests and claims chargeable to the purchase
price of the foreclosed property. The court can then
determine the proper application of compensation with
respect to respondents claim on petitioners remaining
unsecured obligations. In this regard, respondent is not be allowed to enrich himself unjustly at the expense of
precluded from itself filing a case to collect on petitioners others.
remaining debt.[31]
WHEREFORE, the petition is hereby GRANTED. The
An action to collect the surplus proceeds is improper Decision of the Court of Appeals in CA-G.R. CV No. 72240
where there is a pending action for the nullification of the dated September 12, 2005 is MODIFIED by deleting the
foreclosure proceedings. portion ordering petitioner to pay respondent, through
the notary public, the excess of its bid price in the sum
However, unlike in the case of Saguan where the of P488,289.35 with legal interest from January 27,
mortgagors did not challenge the validity of the 2000 until it is paid.
foreclosure but only demanded the return of the surplus,
respondent in this case sought to set aside the foreclosure SO ORDERED.
sale. In fact, a Complaint for Nullification of Foreclosure
Proceedings and Damages was filed before the RTC of
Paraaque docketed as Civil Case No. 00-0513 and raffled
to Branch 194.[32] The filing of a separate case for the
collection of surplus by respondent would therefore be
improper while the annulment case is still pending.

It bears stressing that the collection of surplus is

inconsistent with the annulment of foreclosure because in
suing for the return of the surplus proceeds, the
mortgagor is deemed to have affirmed the validity of the
sale since nothing is due if no valid sale has been
made.[33] It is only after the dismissal of complaint for
annulment or when the foreclosure sale is declared valid
that the mortgagor may recover the surplus in an action
specifically brought for that purpose.[34] However, to avoid
multiplicity of suits, the better recourse is for the
mortgagor to file a case for annulment of foreclosure with
an alternative cause of action for the return of the surplus,
if any.[35]

A similar recourse was done by respondent. In its

complaint for nullification of foreclosure proceedings and
damages pending before Branch 194 of the RTC of
Paraaque City, it alleged, among others, that the
payments made by the [respondent] on the interest and
principal were misapplied and therefore a re-computation
is necessary to determine the amount of the
obligation.[36]Consequently, there is no need for
respondent to file a separate case for collection of surplus
in case the court affirms the validity of the foreclosure
sale. Once the foreclosure is declared valid and a re-
computation of the total amount of obligation is made,
the court in the same case may order petitioner to return
the surplus, if any, pursuant to the legal maxim, Nemo
cum alterius detrimento locupletari potest no person shall
MANUEL N. MAMBA, G.R. No. 165109 funds, a liberal approach should be preferred as it is
RAYMUND P. more in keeping with truth and justice.
GUZMAN and This Petition for Review on Certiorari with prayer for a
LEONIDES N. FAUSTO, Temporary Restraining Order/Writ of Preliminary
Petitioners, Injunction, under Rule 45 of the Rules of Court, seeks to
set aside the April 27, 2004 Order[1] of the Regional Trial
- versus - Court (RTC), Branch 5, Tuguegarao City, dismissing
the Petition for Annulment of Contracts and Injunction
EDGAR R. LARA, Present: with prayer for the issuance of a Temporary Restraining
JENERWIN C. Order/Writ of Preliminary Injunction,[2] docketed as Civil
BACUYAG, Case No. 6283. Likewise assailed in this Petition is
WILSON O. CARPIO,* J., Chairperson, the August 20, 2004 Resolution[3] of RTC, Branch
PUYAWAN, 1, TuguegaraoCity denying the Motion for
ALDEGUNDO Q. CARPIO-MORALES,** Reconsideration of the dismissal.
CAYOSA, JR.,
NORMAN A. AGATEP, LEONARDO-DE CASTRO,*** Factual Antecedents
ESTRELLA P. DEL CASTILLO, and
FERNANDEZ, On November 5, 2001, the Sangguniang
VILMER V. VILORIA, ABAD, JJ. Panlalawigan of Cagayan passed Resolution No. 2001-
BAYLON A. CALAGUI, 272[4] authorizing Governor Edgar R. Lara (Gov. Lara) to
CECILIA MAEVE T. engage the services of and appoint Preferred Ventures
LAYOS, Corporation as financial advisor or consultant for the
PREFERRED VENTURES issuance and flotation of bonds to fund the priority
CORP., projects of the governor without cost and commitment.
ASSET BUILDERS
CORP., On November 19, 2001, the Sangguniang
RIZAL COMMERCIAL Panlalawigan, through Resolution No. 290-
BANKING 2001,[5] ratified the Memorandum of Agreement
CORPORATION, (MOA)[6] entered into by Gov. Lara and Preferred
MALAYAN Ventures Corporation. The MOA provided that the
INSURANCE CO., and provincial government of Cagayan shall pay Preferred
LAND BANK Ventures Corporation a one-time fee of 3% of the
OF THE PHILIPPINES, Promulgated: amount of bonds floated.
Respondents. December 14, 2009 On February 15, 2002, the Sangguniang
x - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - x Panlalawigan approved Resolution No. 2002-061-
A[7] authorizing Gov. Lara to negotiate, sign and execute
DECISION contracts or agreements pertinent to the flotation of the
bonds of the provincial government in an amount not to
DEL CASTILLO, J.: exceed P500 million for the construction and
The decision to entertain a taxpayers suit is discretionary improvement of priority projects to be approved by
upon the Court. It can choose to strictly apply the rule or the Sangguniang Panlalawigan.
take a liberal stance depending on the controversy
involved. Advocates for a strict application of the rule On May 20, 2002, the majority of the members of
believe that leniency would open floodgates to the Sangguniang Panlalawigan of Cagayan approved
numerous suits, which could hamper the government Ordinance No. 19-2002,[8] authorizing the bond flotation
from performing its job. Such possibility, however, is not of the provincial government in an amount not to
only remote but also negligible compared to what is at exceed P500 million to fund the construction and
stake - the lifeblood of the State. For this reason, when development of the new Cagayan Town Center. The
the issue hinges on the illegal disbursement of public Resolution likewise granted authority to Gov. Lara to
negotiate, sign and execute contracts and agreements
necessary and related to the bond flotation subject to
the approval and ratification by the Sangguniang
Panlalawigan.
On October 20, 2003, the Sangguniang
Panlalawigan approved Resolution No. 350-
[9]
2003 ratifying the Cagayan Provincial Bond
Agreements entered into by the provincial government,
represented by Gov. Lara, to wit:
a. Trust Indenture with the Rizal Commercial
Banking Corporation (RCBC) Trust and Investment
Division and Malayan Insurance Company, Inc. (MICO).
b. Deed of Assignment by way of security with the
RCBC and the Land Bank of the Philippines (LBP).
c. Transfer and Paying Agency Agreement with
the RCBC Trust and Investment Division.
d. Guarantee Agreement with the RCBC Trust and
Investment Division and MICO.
e. Underwriting Agreement with RCBC Capital
Corporation.
On even date, the Sangguniang Panlalawigan also
approved Resolution No. 351-2003,[10] ratifying the
Agreement for the Planning, Design, Construction, and
Site Development of the New Cagayan Town
Center[11] entered into by the provincial
government, represented by Gov. Lara and Asset
Builders Corporation, represented by its President, Mr.
Rogelio P. Centeno.
On May 20, 2003, Gov. Lara issued the Notice of Award
to Asset Builders Corporation, giving to the latter the
planning, design, construction and site development of
the town center project for a fee of P213,795,732.39.[12]
Proceedings before the Regional Trial Court
On December 12, 2003, petitioners Manuel N. Mamba,
Raymund P. Guzman and Leonides N. Fausto filed a
Petition for Annulment of Contracts and Injunction with
prayer for a Temporary Restraining Order/Writ of
Preliminary Injunction[13] against Edgar R. Lara, Jenerwin
C. Bacuyag, Wilson O. Puyawan, Aldegundo Q. Cayosa,
Jr., Norman A. Agatep, Estrella P. Fernandez, Vilmer V.
Viloria, Baylon A. Calagui, Cecilia Maeve T. Layos,
Preferred Ventures Corporation, Asset Builders
Corporation, RCBC, MICO and LBP.
At the time of the filing of the petition, Manuel N.
Mamba was the Representative of the 3rd Congressional
District of the province of Cagayan[14] while Raymund P.
Guzman and Leonides N. Fausto were members of
the Sangguniang Panlalawigan of Cagayan.[15]
Edgar R. Lara was sued in his capacity as governor of
Cagayan,[16] while Jenerwin C. Bacuyag, Wilson O.
Puyawan, Aldegundo Q. Cayosa, Jr., Norman A. Agatep,
Estrella P. Fernandez, Vilmer V. Viloria, Baylon A. Calagui
and Cecilia Maeve T. Layos were sued as members of
the Sangguniang Panlalawigan of
[17]
Cagayan. Respondents Preferred Ventures
Corporation, Asset Builders Corporation, RCBC, MICO
and LBP were all impleaded as indispensable or
necessary parties.
Respondent Preferred Ventures Corporation is the
financial advisor of the province of Cagayan regarding
the bond flotation undertaken by the
[18]
province. Respondent Asset Builders Corporation was
awarded the right to plan, design, construct and develop
the proposed town center.[19] Respondent RCBC,
through its Trust and Investment Division, is the trustee
of the seven-year bond flotation undertaken by the
province for the construction of the town
center,[20] while respondent MICO is the
[21]
guarantor. Lastly, respondent LBP is the official
depositary bank of the province.[22]
In response to the petition, public respondents filed an
Answer with Motion to Dismiss,[23] raising the following
defenses: a) petitioners are not the proper parties or
they lack locus standi in court; b) the action is barred by
the rule on state immunity from suit and c) the issues
raised are not justiciable questions but purely political.
For its part, respondent Preferred Ventures Corporation
filed a Motion to Dismiss[24] on the following grounds: a)
petitioners have no cause of action for injunction; b)
failure to join an indispensable party; c) lack of
personality to sue and d) lack of locus
standi. Respondent MICO likewise filed a Motion to
Dismiss[25] raising the grounds of lack of cause of action
and legal standing. Respondent RCBC similarly argued in
its Motion to Dismiss[26] that: a) petitioners are not the
real parties-in-interest or have no legal standing to
institute the petition; b) petitioners have no cause of
action as the flotation of the bonds are within the right
and power of both respondent RCBC and the province of
Cagayan and c) the viability of the construction of a town
center is not a justiciable question but a political
question.
Respondent Asset Builders Corporation, on the other
hand, filed an Answer[27] interposing special and
affirmative defenses of lack of legal standing and cause
of action. Respondent LBP also filed an
[28]
Answer alleging in the main that petitioners have no
cause of action against it as it is not an indispensable
party or a necessary party to the case.
Two days after the filing of respondents respective
memoranda on the issues raised during the hearing of
the special and/or affirmative defenses, petitioners filed
a Motion to Admit Amended Petition[29] attaching
thereto the amended petition.[30] Public respondents
opposed the motion for the following reasons: 1) the
motion was belatedly filed; 2) the Amended Petition is
not sufficient in form and in substance; 3) the motion is
patently dilatory and 4) the Amended Petition was filed
to cure the defect in the original petition.[31]
Petitioners also filed a Consolidated Opposition to the
Motion to Dismiss[32] followed by supplemental
pleadings[33] in support of their prayer for a writ of
preliminary injunction.
On April 27, 2004, the RTC issued the assailed Order
denying the Motion to Admit Amended Petition and
dismissing the petition for lack of cause of action. It ruled
that:
The language of Secs. 2 & 3 of Rule 10 of the 1997 Rules
of Civil Procedure dealing on the filing of an amended
pleading is quite clear. As such, the Court rules that the
motion was belatedly filed. The granting of leave to file
amended pleadings is a matter peculiarly within the
sound discretion of the trial court. But the rule allowing
amendments to pleadings is subject to the general but
inflexible limitation that the cause of action or defense
shall not be substantially changed or the theory of the
case altered to the prejudice of the other party (Avecilla
vs. Yatcvo, 103 Phil. 666).
On the assumption that the controversy presents
justiciable issues which this Court may take cognizance
of, petitioners in the present case who presumably
presented legitimate interests in the controversy are not
parties to the questioned contract. Contracts produce
effect as between the parties who execute them. Only a
party to the contract can maintain an action to enforce
the obligations arising under said contract (Young vs. CA,
169 SCRA 213). Since a contract is binding only upon the
parties thereto, a third person cannot ask for its
rescission if it is in fraud of his rights. One who is not a
party to a contract has no rights under such contract and
even if the contrary may be voidable, its nullity can be
asserted only by one who is a party thereto; a third
person would have absolutely no personality to ask for
the annulment (Wolfson vs. Estate of Martinez, 20 Phil.
340; Ibaez vs. Hongkong & Shanghai Bank, 22 Phil. 572;
Ayson vs. CA, G.R. Nos. L-6501 & 6599, May 21, 1955).
It was, however, held that a person who is not a party
obliged principally or subsidiarily in a contract may
exercise an action for nullity of the contract if he is
prejudiced in his rights with respect to one of the
contracting parties and can show the detriment which
would positively result to him from the contract in which
he had no intervention (Baez vs. CA, 59 SCRA 15; Anyong
Hsan vs. CA, 59 SCRA 110, 112-113; Leodovica vs. CA, 65
SCRA 154-155). In the case at bar, petitioners failed to
show that they were prejudiced in their rights [or that a]
detriment x x x would positively result to
them. Hence, they lack locus standi in court.
xxxx
To the mind of the Court, procedural matters in the
present controversy may be dispensed with, stressing
that the instant case is a political question, a question
which the court cannot, in any manner, take judicial
cognizance. Courts will not interfere with purely political
questions because of the principle of separation of
powers (Taada vs. Cuenco, 103 Phil. 1051). Political
questions are those questions which, under the
Constitution, are to be decided by the people in their
sovereign capacity or in regard to which full discretionary
authority has been delegated to the legislative or [to the]
executive branch of the government (Nuclear Free Phils.
Coalition vs. NPC, 141 SCRA 307 (1986); Torres vs.
Gonzales, 152 SCRA 272; Citizens Alliance for Consumer
Protection vs. Energy Regulatory Board, G.R. No. 78888-
90, June 23, 1988).
The citation made by the provincial government[, to]
which this Court is inclined to agree, is that the matter
falls under the discretion of another department, hence
the decision reached is in the category of a political
question and consequently may not be the subject of
judicial jurisdiction (Cruz in Political Law, 1998 Ed., page
81) is correct.
It is [a] well-recognized principle that purely
administrative and discretionary functions may not be
interfered with by the courts (Adm. Law Test & Cases,
2001 Ed., De Leon, De Leon, Jr.).
The case therefore calls for the doctrine of ripeness for
judicial review. This determines the point at which courts
may review administrative action. The basic principle of
ripeness is that the judicial machinery should be
conserved for problems which are real and present or
imminent and should not be squandered on problems
which are future, imaginary or remote. This case is not
ripe for judicial determination since there is no
imminently x x x substantial injury to the petitioners.
In other words, the putting up of the New Cagayan Town
Center by the province over the land fully owned by it
and the concomitant contracts entered into by the same
is within the bounds of its corporate power, an
undertaking which falls within the ambit of its discretion
and therefore a purely political issue which is beyond the
province of the court x x x. [Consequently, the court
cannot,] in any manner, take judicial cognizance over
it. The act of the provincial government was in
pursuance of the mandate of the Local Government
Code of 1991.
xxxx
Indeed, adjudication of the procedural issues presented
for resolution by the present action would be a futile
exercise in exegesis.
What defeats the plea of the petitioners for the issuance
of a writ of preliminary injunction is the fact that their
averments are merely speculative and founded on
conjectures. An injunction is not intended to protect
contingent or future rights nor is it a remedy to enforce
an abstract right (Cerebo vs. Dictado, 160 SCRA 759;
Ulang vs. CA, 225 SCRA 637). An injunction, whether
preliminary or final, will not issue to protect a right not
in in esse and which may never arise, or to restrain an act
which does not give rise to a cause of action. The
complainants right on title, moreover, must be clear and
unquestioned [since] equity, as a rule, will not take
cognizance of suits to establish title and will not lend its
preventive aid by injunction where the complainants
title or right is doubtful or disputed. The possibility of
irreparable damage, without proof of violation of an
actual existing right, is no ground for injunction being a
mere damnum, absque injuria (Talisay-Silay Milling
Company, Inc. vs. CFI of Negros Occidental, et. al. 42
SCRA 577, 582).
xxxx
For lack of cause of action, the case should be dismissed.
The facts and allegations [necessarily] suggest also that
this court may dismiss the case for want of jurisdiction.
The rule has to be so because it can motu propio dismiss
it as its only jurisdiction is to dismiss it if it has no
jurisdiction. This is in line with the ruling in Andaya vs.
Abadia, 46 SCAD 1036, G.R. No. 104033, Dec. 27,
1993 where the court may dismiss a complaint even
without a motion to dismiss or answer.
Upon the foregoing considerations, the case is hereby
dismissed without costs.
SO ORDERED.[34]
Petitioners filed a Motion for Reconsideration[35] to
which respondents filed their respective
[36]
Oppositions. Petitioners then filed a Motion to Inhibit,
which the court granted.Accordingly, the case was re-
raffled to Branch 1 of the RTC of Tuguegarao City.[37]
On August 20, 2004, Branch 1 of the RTC of Tuguegarao
City issued a Resolution denying petitioners plea for
reconsideration. The court found the motion to be a
mere scrap of paper as the notice of hearing was
addressed only to the Clerk of Court in violation of
Section 5, Rule 15 of the Rules of Court. As to the merits,
the court sustained the findings of Branch 5 that
petitioners lack legal standing to sue and that the issue
involved is political.
Issues
Hence, the present recourse where petitioners argue
that:
A. The lower court decided a question
of substance in a way not in accord with law and with
the applicable decision of the Supreme Court, and
B. The lower court has so far departed
from the accepted and usual course of judicial
proceedings as to call for an exercise of the power of
supervision in that:
I. It denied locus standi to
petitioners;
II. [It] determined that the matter of
contract entered into by the provincial government is in
the nature of a political question;
III. [It] denied the admission of Amended
Petition; and
IV. [It] found a defect of substance in the
petitioners Motion for Reconsideration.[38]
Our Ruling
The petition is partially meritorious.
Petitioners have legal standing to sue as taxpayers
A taxpayer is allowed to sue where there is a claim that
public funds are illegally disbursed, or that the public
money is being deflected to any improper purpose, or
that there is wastage of public funds through the
enforcement of an invalid or unconstitutional law.[39] A
person suing as a taxpayer, however, must show that the
act complained of directly involves the illegal
disbursement of public funds derived from
taxation.[40] He must also prove that he has sufficient
interest in preventing the illegal expenditure of money
raised by taxation and that he will sustain a direct injury
because of the enforcement of the questioned statute or
contract.[41] In other words, for a taxpayers suit to
prosper, two requisites must be met: (1) public funds
derived from taxation are disbursed by a political
subdivision or instrumentality and in doing so, a law is
violated or some irregularity is committed and (2) the
petitioner is directly affected by the alleged act.[42]
In light of the foregoing, it is apparent that contrary to
the view of the RTC,
a taxpayer need not be a party to the contract to
challenge its validity.[43] As long as taxes are involved,
people have a right to question contracts entered into by
the government.
In this case, although the construction of the town
center would be primarily sourced from the proceeds of
the bonds, which respondents insist are not taxpayers
money, a government support in the amount of P187
million would still be spent for paying the interest of the
bonds.[44] In fact, a Deed of Assignment[45] was executed
by the governor in favor of respondent RCBC over the
Internal Revenue Allotment (IRA) and other revenues of
the provincial government as payment and/or security
for the obligations of the provincial government under
the Trust Indenture Agreement dated September 17,
2003. Records also show that on March 4, 2004, the
governor requested the Sangguniang Panlalawigan to
appropriate an amount of P25 million for the interest of
the bond.[46] Clearly, the first requisite has been met.
As to the second requisite, the court, in recent cases, has
relaxed the stringent direct injury test bearing in mind
that locus standi is a procedural technicality.[47] By
invoking transcendental importance, paramount public
interest, or far-reaching implications, ordinary citizens
and taxpayers were allowed to sue even if they failed to
show direct injury.[48] In cases where serious legal issues
were raised or where public expenditures of millions of
pesos were involved, the court did not hesitate to give
standing to taxpayers.[49]
We find no reason to deviate from the jurisprudential
trend.
To begin with, the amount involved in this case is
substantial. Under the various agreements entered into
by the governor, which were ratified by the Sangguniang
Panlalawigan, the provincial government of Cagayan
would incur the following costs:[50]
Compensation to Preferred Ventures - P 6,150,000.00
(3% of P205M)[51] Resolution No. 290-2001
Management and Underwriting Fees - 3,075,000.00
(1.5% of P205M)[52]
Documentary Tax - 1,537,500.00
(0.75% of P205M)[53]
Guarantee Fee[54] - 7,350,000.00
Construction and Design of town center[55] -
213,795,732.39
Total Cost - P231,908,232.39
What is more, the provincial government would be
shelling out a total amount of P187 million for the period
of seven years by way of subsidy for the interest of the
bonds. Without a doubt,the resolution of the present
petition is of paramount importance to the people of
Cagayan who at the end of the day would bear the brunt
of these agreements.
Another point to consider is that local government units
now possess more powers, authority and resources at
their disposal,[56] which in the hands of unscrupulous
officials may be abused and misused to the detriment of
the public. To protect the interest of the people and to
prevent taxes from being squandered or wasted under
the guise of government projects, a liberal approach
must therefore be adopted in determining locus standi in
public suits.
In view of the foregoing, we are convinced that
petitioners have sufficient standing to file the present
suit. Accordingly, they should be given the opportunity
to present their case before the RTC.
Having resolved the core issue, we shall now proceed to
the remaining issues.
The controversy involved is justiciable
A political question is a question of policy, which is to be
decided by the people in their sovereign capacity or by
the legislative or the executive branch of the
government to which full discretionary authority has
been delegated.[57]
In filing the instant case before the RTC, petitioners seek
to restrain public respondents from implementing the
bond flotation and to declare null and void all contracts
related to the bond flotation and construction of the
town center. In the petition before the RTC, they alleged
grave abuse of discretion and clear violations of law by
public respondents. They put in issue the overpriced
construction of the town center; the grossly
disadvantageous bond flotation; the irrevocable
assignment of the provincial governments annual regular
income, including the IRA, to respondent RCBC to cover
and secure the payment of the bonds floated; and the
lack of consultation and discussion with the community
regarding the proposed project, as well as a proper and
legitimate bidding for the construction of the town
center.
Obviously, the issues raised in the petition do not refer
to the wisdom but to the legality of the acts complained
of. Thus, we find the instant controversy within the
ambit of judicial review. Besides, even if the issues were
political in nature, it would still come within our powers
of review under the expanded jurisdiction conferred
upon us by Section 1, Article VIII of the Constitution,
which includes the authority to determine whether
grave abuse of discretion amounting to excess or lack of
jurisdiction has been committed by any branch or
instrumentality of the government.[58]
The Motion to Admit Amended Petition was properly
denied
However, as to the denial of petitioners Motion to Admit
Amended Petition, we find no reason to reverse the
same. The inclusion of the province of Cagayan as a
petitioner would not only change the theory of the case
but would also result in an absurd situation. The
provincial government, if included as a petitioner, would
in effect be suing itself considering that public
respondents are being sued in their official capacity.
In any case, there is no need to amend the petition
because petitioners, as we have said, have legal standing
to sue as taxpayers.
Section 5, Rule 15 of the Rules of Court was
substantially complied with
This brings us to the fourth and final issue.
A perusal of the Motion for Reconsideration filed by
petitioners would show that the notice of hearing was
addressed only to the Clerk of Court in violation of
Section 5, Rule 15 of the Rules of Court, which requires
the notice of hearing to be addressed to all parties
concerned. This defect, however, did not make the
motion a mere scrap of paper. The rule is not a ritual to
be followed blindly.[59] The purpose of a notice of hearing
is simply to afford the adverse parties a chance to be
heard before a motion is resolved by the court.[60] In this
case, respondents were furnished copies of the motion,
and consequently, notified of the scheduled
hearing. Counsel for public respondents in fact moved
for the postponement of the hearing, which the court
granted.[61] Moreover, respondents were afforded
procedural due process as they were given sufficient
time to file their respective comments or oppositions to
the motion. From the foregoing, it is clear that the rule
requiring notice to all parties was substantially complied
with.[62] In effect, the defect in the Motion for
Reconsideration was cured.

We cannot overemphasize that procedural rules are

mere tools to aid the courts in the speedy, just and
inexpensive resolution of cases.[63] Procedural defects or
lapses, if negligible, should be excused in the higher
interest of justice as technicalities should not override
the merits of the case. Dismissal of cases due to
technicalities should also be avoided to afford the parties
the opportunity to present their case. Courts must be
reminded that the swift unclogging of the dockets
although a laudable objective must not be done at the
expense of substantial justice.[64]

WHEREFORE, the instant Petition is PARTIALLY

GRANTED. The April 27, 2004 Order of Branch 5 and the
August 20, 2004 Resolution of Branch 1 of the Regional
Trial Court of Tuguegarao City are
hereby REVERSED and SET ASIDE insofar as the dismissal
of the petition is concerned. Accordingly, the case is
hereby REMANDED to the court a quo for further
proceedings.

SO ORDERED.
ARSENIO OLEGARIO and G.R. No. 147951 possession of the same by delineating the limits with a
HEIRS OF ARISTOTELES F. bamboo fence,[5] planting various fruit bearing trees and
OLEGARIO, represented bamboos[6] and constructing a house thereon.[7] After a
by survey made in 1950, Tax Declaration No. 8048[8] for the
CARMELITA GUZMAN- Present: year 1951 specified the subject realty as a residential
OLEGARIO, land with an area of 897 square meters and as having
Petitioners, CARPIO,* J., Chairperson, the following boundaries: North - Magdalena Fernandez;
CARPIO-MORALES,** South - Catalina Cacayorin; East - Camino Vecinal; and
LEONARDO-DE West - Norberto Bugarin. In 1974, the subject realty was
CASTRO,*** transferred to respondent, Pedro Mari, by virtue of a
- versus - DEL CASTILLO, and deed of sale.
ABAD, JJ.
Meanwhile, in 1947, Wenceslao Olegario, the husband
PEDRO C. of Magdalena Fernandez and father of petitioner
MARI, represented by Arsenio Olegario, filed a new tax declaration[9] for a
LILIA C. MARI-CAMBA, Promulgated: certain 50-square meter parcel of land, indicating the
Respondent. December 14, 2009 following boundaries: North - Cesario and Antonio
x--------------------------------------------- Fernandez; South - Juan Mari; East - Barrio Road; and
----------------------x West - Norberto Bugarin. Then on May 14, 1961,
Wenceslao Olegario executed a "Deed of Quit-Claim of
Unregistered Property"[10] in favor of Arsenio Olegario
DECISION transferring to the latter inter alia the aforementioned
50-square meter property.

DEL CASTILLO, J.:
Possession, to constitute the foundation of acquisitive
prescription, must be possession under a claim of title or
must be adverse. Acts of a possessory character
performed by one who holds the property by mere
tolerance of the owner are clearly not in the concept of
an owner and such possessory acts, no matter how long
continued, do not start the running of the period of
prescription.
In the cadastral survey conducted from 1961 to 1962,
the subject realty was identified as Lot Nos. 17526,
17553 and 14356 of the Mangatarem Cadastre. At this
time, Wenceslao Olegario disputed Juan Maris claim
over Lot Nos. 17526 and 17553. Hence, on the two
corresponding survey notification cards
dated September 28, 1968,[11] the claimant appeared as
"Juan Mari v. Wenceslao Olegario". With regard to Lot
No. 14356, the survey notification card named Juan Mari
as the claimant.

In the present Petition for Review Sometime around 1988, respondent filed with the
on Certiorari,[1] petitioners assail the April 18, 2001 Department of Environment and Natural Resources
Decision[2] of the Court of Appeals (CA) in CA-G.R. CV No. Regional Office in Pangasinan a protest against the
52124, reversing the October 13, 1995 Decision[3] of the petitioners because of their encroachment into the
Regional Trial Court (RTC) of Pangasinan, Branch 39. The disputed realty. After investigation, said office decided in
CA declared the respondent herein as the owner of Lot favor of the respondent and found the latter to be the
Nos. 17553, 17526 and 14356 of the Mangatarem owner of Lot Nos. 17526, 17553 and 14356. Petitioners
cadastral survey. did not appeal and the said decision became final and
executory.
Factual antecedents
In 1989, Arsenio Olegario caused the amendment of his
As early as1916,[4] Juan
Mari, the father of respondent, tax declaration[12] for the 50-square meter property to
declared his ownership over a parcel of land in reflect 1) an increased area of 341 square meters; 2) the
Nancasalan, Mangatarem for tax purposes. He took Cadastral Lot No. as 17526, Pls-768-D;[13] and 3) the
boundaries as: North-NE Lot 16385 & Road; South-NW-
Lots 14363 & 6385, Pls-768-D; East-SE-Lot 17552, Pls-
768-D and West-SW-Lot 14358, Pls-768-D.
Proceedings before the Regional Trial Court
In 1990, after discovering the amended entries in
Arsenio Olegario's Tax Declaration No. 4107-R,
respondent filed a complaint[14] with the RTC of
Lingayen, Pangasinan, for Recovery of Possession and
Annulment of Tax Declaration No. 4107-R. Respondent
alleged, inter alia, that Juan Mari, and subsequently his
successor, was deprived by the Olegarios of the
possession of portions of subject realty which
respondent owned. Trial thereafter ensued.
On October 13, 1995, the RTC rendered judgment in
favor of the petitioners, viz:
WHEREFORE, in the light of the foregoing considerations,
judgment is hereby rendered as follows:
1. Declaring the defendants-Olegario the owners of Lots
17553 and 17526 of the Mangatarem cadastral survey.
2. Dismissing the plaintiff's Complaint on the ground of
prescription of action and on the further ground that
[he] failed to prove [his] ownership of any portion of the
two lots mentioned in the next preceding paragraph
(assuming arguendo that [his] action has not prescribed);
3. Ordering the plaintiff to pay the costs of this suit. No
damages are awarded by the Court.
SO ORDERED.[15]
Proceedings before the Court of Appeals
Respondent appealed to the CA which reversed the trial
court's findings. The CA found respondent to have
adduced stronger evidence of prior possession and
ownership of the disputed realty.The dispositive portion
of the CA Decision states:
WHEREFORE, the trial court's Decision dated October 13,
1995 is REVERSED and SET ASIDE and a new one is
hereby entered declaring appellant Pedro C. Mari
represented by Lilia C. Mari-Camba the lawful owner of
Lot Nos. 17526, 17553 and 14356 of the Mangatarem
Cadastre, without pronouncement as to costs.
SO ORDERED.[16]
Petitioners, without filing a motion for reconsideration of
the CA Decision, thereafter filed the present petition for
review.
Issues
Petitioners raise the following issues:
1. Whether or not there was failure on [the part of] the
Court of Appeals to appreciate and give weight to the
evidence presented by the petitioners;
2. Whether or not the Court of Appeals erred in its
decision in adjudicating ownership of the said lots in
favor of the respondent and [in] giving great weight to
the respondents evidence;
3. Whether or not the Court of Appeals erred in its
failure to declare the action as barred by laches;
4. Whether or not the Court of Appeals failed to find
an[d] declare the petitioners as having acquired
ownership of the disputed lots by acquisitive
prescription;
5. Whether or not the Court of Appeals erred in
adjudicating the lot in favor of respondent and also [in]
denying award of damages to petitioners.[17]
Petitioners' Arguments
Petitioners contend that they have been in possession of
the disputed lots since 1948 or thereabouts, or for more
than 30 years already. Hence, they acquired ownership
thereover by virtue of prescription. They also impute
negligence or failure on the part of respondent to assert
his alleged rights within a reasonable time.
Respondent's Arguments
On the other hand, respondent asserts that petitioners
claim ownership over only a certain 50-square meter
parcel of land, as evidenced by their tax declaration
which consistently declared only such area. It was only in
September 1989 that petitioners sought to expand the
area of their claim to 341 square meters by virtue of a
letter to the Provincial Assessor of Pangasinan. Hence,
respondent asserts that prescription has not set
in. Respondent also contends that petitioners'
occupancy has been illegal from the point of inception
and thus, such possession can never ripen into a legal
status.
Our Ruling
The petition has no merit.
Petitioners' Evidence is Weak
Considering the conflicting findings of the RTC and the
CA, a circumstance that constitutes an exception[18] to
the general rule that only questions of law are proper
subjects of a petition under Rule 45, we shall assess and
weigh the evidence adduced by the parties and shall
resolve the questions of fact raised by petitioners.
A study of the evidence presented by petitioners shows
that the CA did not err in finding such evidence weaker
than that of respondent. Arsenio Olegario testified that
as early as 1937 their family had built a nipa house on
the land where they lived. Yet he also testified that the
former owner of the land was his mother, Magdalena
Fernandez.[19] Significantly, Magdalena Fernandez has
never claimed and was never in possession or ownership
of Lot Nos. 17553, 17526 and 14356. Petitioners
evidence thus supports the conclusion that in 1937 they
were in possession, not of Lot No. 17526, but of their
mothers land, possibly 50 square meters of it, which is
the approximate floor area of the house. Conversely,
petitioners' evidence fails to clearly prove that in 1937
they were already occupying the disputed lots. The
records, in fact, do not show exactly when the Olegarios
entered and started occupying the disputed lots.
The evidence shows that a hollow block fence, an
improvement introduced by the Olegarios in 1965, now
exists somewhere along the disputed lots. Petitioners'
claim that they were in possession of the disputed lots
even prior to 1965 based on the existence of the
bamboo fence on the boundary of their land preceding
the existence of the hollow block fence, however, holds
no water. The testimony of Marcelino Gutierrez shows
that formerly there was a bamboo fence demarcating
between the land of the Olegarios and the Maris and
that in 1964 or 1965 a hollow block fence was
constructed. He did not say, however, that the place
where the hollow block fence was constructed was the
exact same place where the bamboo boundary fence
once stood. Even the testimony of Arsenio Olegario was
ambiguous on this matter, viz:
Q When was the [concrete] hollow block [fence]
separating your property [from] the property of Juan
Mari constructed?
A It was constructed in 1965.
Q Before the construction of that concrete hollow block
fence between your land and the land of Juan Mari [in]
1965, what was the visible boundary between your land
and the land of Juan Mari?
A Bamboo fence, sir.[20]
Arsenio merely testified that a bamboo fence was
formerly the visible boundary between his land and
the land of Juan Mari; and that a concrete hollow block
fence was constructed in 1965. His testimony failed to
show that the concrete hollow block fence was
constructed in the same position where the bamboo
boundary fence once stood.
On the other hand, there is ample evidence on record,
embodied in Tax Declaration No. 9404 for the year 1947;
the survey sketch plan of 1961; and the survey plan of
1992, that the boundary claimed by the Olegarios kept
moving in such a way that the portion they occupied
expanded from 50 square meters (in the land of his
mother) to 377 square meters.[21] Viewed in relation to
the entire body of evidence presented by the parties in
this case, these documents cannot plausibly all be
mistaken in the areas specified therein. As against the
bare claim of Arsenio[22] that his predecessor merely
made an inaccurate estimate in providing 50 square
meters as the area claimed by the latter in 1947 in the
tax declaration,[23] we find it more plausible to believe
that each of the documents on record stated the true
area measurements of the parties' claims at the
particular time each document was executed.
As correctly found by the CA, the earliest that petitioners
can be considered to have occupied the disputed
property was in 1965 when the concrete hollow block
fence was constructed on the disputed lots.
Ownership and Prescription
As previously mentioned, respondent's predecessor,
Juan Mari, had declared the disputed realty[24] for tax
purposes as early as 1916. The tax declarations show
that he had a two storey house on the realty. He also
planted fruit bearing trees and bamboos thereon. The
records[25] also show that the 897-square meter property
had a bamboo fence along its perimeter. All these
circumstances clearly show that Juan Mari was in
possession of subject realty in the concept of owner,
publicly and peacefully since 1916 or long before
petitioners entered the disputed realty sometime in
1965.
Based on Article 538 of the Civil Code,[26] the respondent
is the preferred possessor because, benefiting from his
father's tax declaration of the subject realty since 1916,
he has been in possession thereof for a longer period. On
the other hand, petitioners acquired joint possession
only sometime in 1965.
Despite 25 years of occupying the disputed lots,
therefore, petitioners did not acquire ownership. Firstly,
they had no just title. Petitioners did not present any
document to show how the titles over Lot Nos. 17526
and 17533 were transferred to them, whether from
respondent, his predecessor, or any other
person.[27] Petitioners, therefore, could not acquire the
disputed real property by ordinary prescription through
possession for 10 years. Secondly, it is settled that
ownership cannot be acquired by mere
occupation. Unless coupled with the element of hostility
towards the true owner, occupation and use, however
long, will not confer title by prescription or adverse
possession.[28] In other words, possession, to constitute
the foundation of a prescriptive right, must be
possession under claim of title, that is, it must be
adverse.[29]
Petitioners' acts of a possessory character - acts that
might have been merely tolerated by the owner - did not
constitute possession. No matter how long tolerated
possession is continued, it does not start the running of
the prescriptive period.[30] Mere material possession of
land is not adverse possession as against the owner and
is insufficient to vest title, unless such possession is
accompanied by the intent to possess as an
owner. There should be a hostile use of such a nature
and exercised under such circumstance as to manifest
and give notice that the possession is under a claim of
right.[31]
Petitioners have failed to prove that their possession was
adverse or under claim of title or right. Unlike
respondent, petitioners did not have either the courage
or forthrightness to publicly declare the disputed lots as
owned by them for tax purposes. Tax declarations
"prove that the holder has a claim of title over the
property. Aside from manifesting a sincere desire to
obtain title thereto, they announce the holder's adverse
claim against the state and other interested
parties".[32] Petitioners' omission, when viewed in
conjunction with respondent's continued unequivocal
declaration of ownership over, payment of taxes on and
possession of the subject realty, shows a lack of sufficient
adverseness of the formers possession to qualify as
being one in the concept of owner.
The only instance petitioners assumed a legal position
sufficiently adverse to respondent's ownership of the
disputed properties was when they declared Lot No.
17526 for tax purposes in their name in 1989.[33] Since
then and until the filing of the complaint for recovery of
possession in 1990, only one year had elapsed. Hence,
petitioners never acquired ownership through
extraordinary prescription of the subject realty.
On the other hand, being the sole transferree of his
father, respondent showed through his tax declarations
which were coupled with possessory acts that he,
through his predecessor, had been in possession of the
land for more than 30 years since 1916. "Open, exclusive
and undisputed possession of alienable public land for
the period prescribed by law creates the legal fiction
whereby the land, upon completion of the requisite
period - ipso jure and without the need of judicial or
other sanction, ceases to be public land and becomes
private property."[34] Ownership of immovable property
is acquired by extraordinary prescription through
possession for 30 years.[35] For purposes of deciding the
instant case, therefore, the possession by respondent
and his predecessor had already ripened into ownership
of the subject realty by virtue of prescription as early as that it can be clearly stated that petitioners were making
1946. their claim of ownership public and unequivocal and
converting their possession over Lot No. 17526 into one
in the concept of owner.

Laches Upon discovery of this clear and unequivocal change in

Petitioners cannot find refuge in the principle of laches. It
is not just the lapse of time or delay that constitutes
laches. The essence of laches is the failure or neglect, for
an unreasonable and unexplained length of time, to do
that which, through due diligence, could or should have
been done earlier, thus giving rise to a presumption that
the party entitled to assert it had earlier abandoned or
declined to assert it.
The essential elements of laches are: (a) conduct on the
part of the defendant, or of one under whom he claims,
giving rise to the situation complained of; (b) delay in
asserting complainant's rights after he had knowledge of
defendant's acts and after he has had the opportunity to
sue; (c) lack of knowledge or notice by defendant that
the complainant will assert the right on which he bases
his suit and (d) injury or prejudice to the defendant in the
event the relief is accorded to the complainant.[36]
status of petitioners position over the disputed land
respondent immediately acted. He filed in 1990 the
complaint for recovery of possession and nullification of
tax declaration. Hence, we find no laches in the instant
case.
In conclusion, we find no reversible error on the part of
the CA in recognizing the ownership and right of
possession of respondent over Lot Nos. 17526, 17553
and 14356. There is, thus, also no basis for an award of
damages and attorneys fees in favor of petitioners.
WHEREFORE, the instant petition is DENIED. The
assailed Decision of the Court of Appeals dated April 18,
2001 is AFFIRMED.
SO ORDERED.

In the instant case, the second and third elements are

missing. Petitioners had notice and knew all along the
position of the respondent and his predecessor Juan
Mari - they were standing pat on his ownership over the
subject realty. This stand of respondent and his
predecessor was recorded and clearly visible from the
notification survey cards.[37] From 1968, the date of the
cards, until 1989 there was nothing to indicate any
change in the position of any of the parties. Moreover,
that respondent had not conceded ownership and
possession of the land to petitioners is clear also from
the fact that Pedro Mari continued to declare the entire
897-square meter property in his name and pay taxes for
the entire area after his father transferred the property
to him.

On the other hand, it was petitioners who suddenly

changed their position in 1989 by changing the area of
the property declared in their name from 50 square
meters to 341 square meters and specifying the details
to make it appear that the tax declaration for the 50-
square meter property pertained to Lot No. 17526. As
previously discussed, it was only at this point, in 1989,
JOSEPHINE WEE, G.R. No. 177384 executed by Julian Gonzales in her favor. Petitioner
Petitioner, claimed the benefits of the Property Registration
Present: Decree[9] or, should said Decree be inapplicable, the
benefits of Chapter VIII of Commonwealth Act No. 141
CARPIO,* J., Chairperson, (1936),[10] because she and her predecessor-in-interest
- versus - LEONARDO-DE CASTRO,** have been in open, continuous, public, peaceful and
BRION, adverse possession of the land since time immemorial.
DEL CASTILLO, and
ABAD, JJ. On March 15, 1995, the Republic of the Philippines,
through the Office of the Solicitor General (OSG), filed its
REPUBLIC OF Promulgated: Opposition[11] alleging that neither the petitioner nor her
THE PHILIPPINES, predecessor-in-interest has been in open, continuous,
Respondent. December 8, 2009 exclusive and notorious possession and occupation of
x--------------------------------------------- Lot No. 8349 since June 12, 1945 or prior thereto. The
----------------------x OSG likewise averred that the muniments of title and tax
payment receipts submitted by the petitioner do not
DECISION constitute competent or sufficient evidence of a bona
fide acquisition of the subject lot, or of the petitioners
DEL CASTILLO, J.: open, continuous, exclusive and notorious possession
and occupation thereof in the concept of owner since
In land registration cases, the applicant has the burden June 12, 1945 or prior thereto. It asserted that Lot No.
to show that he or she is the real and absolute owner in 8349 is part of the public domain and consequently
fee simple of the land sought to be registered.[1] It is also prayed for the dismissal of the application for
important to bear in mind that one who seeks registration.
registration of title must prove his or her claim with well-
nigh incontrovertible evidence.[2] In this case, petitioner Petitioner presented the following pieces of
miserably failed to show that she is the real and absolute documentary evidence before the trial court:
owner in fee simple of the land sought to be registered.
1) Deed of Absolute Sale between
Assailed in this Petition for Review on Certiorari[3] under Josephine Wee and Julian Gonzales dated February 1,
Rule 45 of the Rules of Court are the April 28, 2006 1993;[12]
Decision[4] of the Court of Appeals (CA) and its
subsequent Resolution[5] dated April 3, 2007 in CA-G.R. 2) Tax Declarations in the name of
CV No. 76519. Said Decision and Resolution reversed and Julian Gonzales for the years 1957, 1961, 1967, 1980,
set aside the April 2, 2002 Judgment[6] of the Regional and 1985;[13]
Trial Court (RTC) of Tagaytay City, Branch 18 and held
that petitioner was not entitled to the requested 3) Tax Declarations in the name of
registration of title. Josephine Wee from 1993 onwards;[14]

Proceedings before the Regional Trial Court 4) Receipts for tax payments made by
On December 22, 1994, petitioner filed an Application Josephine Wee from 1993-1999;[15]
for Registration of Title[7] over a 4,870-square meter
parcel of land situated in Barangay Puting Kahoy, Silang, 5) Affidavit of Seller-Transferor
Cavite, designated as Lot No. 8349 (Cadastral Lot. No. executed by Julian Gonzales on February 10, 1993;[16]
452-D).
6) Affidavit of Ownership, Aggregate
In brief, petitioner alleged in her application that she is Land Holding and Non-Tenancy executed by Julian
the owner in fee simple of the subject property by virtue Gonzales on February 10, 1993;[17]
of a Deed of Absolute Sale[8] dated February 1, 1993
7) Affidavit of Non-Tenancy executed
by Julian Gonzales on February 10, 1993;[18]
8) Salaysay executed by Juana
Macatangay Gonzales, Erlinda Gonzales Batingal and
Remedios Gonzales Bayan;[19]
9) Certification dated March 2, 2000 by
the Department of Environment and Natural Resources
(DENR) stating that Lot No. 8349 was shown to be within
the Alienable or Disposable Land per Land Classification
Map No. 3013 established under FAO-4-1656 on March
15, 1982;[20]
10) Survey Plan of Lot No. 8349;[21] and
11) Surveyors Certificate, Technical
Description and Tracing Cloth.[22]
She also presented the testimonies of the following
witnesses who were all cross-examined by the Republic
through the public prosecutor:
1) Josephine Wee, who testified that
she purchased Lot No. 8349 from Julian Gonzales
through a Deed of Absolute Sale dated February 1, 1993
and immediately took possession thereof after the sale;
that she did not cultivate it because it is planted with
coffee; that she paid for all the real property taxes
subsequent to the sale; that she caused the preparation
of a survey plan; that the property is not part of the
public domain or any river or military reservation; that
there are no adverse claimants and no cases were filed
against her after the sale involving said lot and that she is
not doing anything with the property because it is not
productive.[23]
2) Juana Gonzales, the 75-year old
widow of Julian Gonzales, who declared that she and her
husband sold Lot No. 8349 to the petitioner and
identified her husbands signature and her own
thumbmark. She testified that she and her late husband
had been in possession of Lot No. 8349 prior to the sale
to Josephine Wee; that her husband inherited the
property from his parents a long time ago; that her
husband already had the property when they got
married and that she and Julian Gonzales began living
together in 1946. She also identified and affirmed the
due execution and authenticity of her Salaysay, as well
as the documents signed by her husband.[24]
3) Remedios Gonzales Bayan, the 39-
year old daughter of Julian and Juana Gonzales, who
testified that she witnessed the execution of the Deed of
Absolute Sale between her father whose signature she
identified and the applicant in February 1993. She also
identified and affirmed the due execution and
authenticity of her Salaysay.[25]
Ruling of the Regional Trial Court
On April 2, 2002, the RTC promulgated in favor of the
petitioner a Judgment,[26] pertinent portions of which
read:
Culled from the evidence on record, both testimonial
and documentary, are facts which satisfactorily establish
applicants ownership in fee simple of the parcel of land,
subject matter of the instant proceedings, to wit: that by
means of an appropriate deed of sale, the applicant has
acquired said property by purchase from Julian Gonzales
on February 1, 1993; that the same parcel was declared
for taxation purposes; that all the realty taxes due
thereon have been duly paid. Likewise, this Court could
well-discern from the survey plan covering the same
property and other documents presented, more
particularly the tracing cloth plan which was presented
as additional evidence in support of the application, that
the land sought to be registered is agricultural and not
within any forest zone or the public domain; that the
land is not covered by any public land
application/patent, and that there is no other adverse
claimant thereof; and further, that tacking her
predecessors-in-interests possession to applicants, the
latter appears to be in continuous and public possession
thereof for more than thirty (30) years.
On the basis of the foregoing facts and considering that
applicant is a Filipino citizen not otherwise disqualified
from owning real property, this Court finds that she has
satisfied all the conditions essential to the grant of her
application pursuant to the provisions of the Land
Registration Law, as amended.
WHEREFORE, this Court hereby approves this application
for registration and thus places under the operation of
Act 141, Act 496 and/or P.D. 1529, otherwise known as
Property Registration Law, the lands described in Plan
Ap-04-010262, Lot 8349 and containing an area of Four
Thousand Eight Hundred Seventy (4,870) Square Meters
as supported by its technical description now forming
part of the record of this case, in addition to other proofs
adduced in the name of JOSEPHINE WEE, who is of legal
age, single and with residence at 1345 Claro M. Recto
Avenue, Sta, Cruz, Manila.
Once this Decision becomes final and executory, the
corresponding decree of registration shall forthwith
issue.
SO ORDERED.
Proceedings before the Court of Appeals
Unsatisfied, the Republic, through the OSG, filed its
Notice of Appeal on April 26, 2002, alleging that the RTC
erred in granting the application for registration
considering that petitioner failed to comply with all the
legal requirements for judicial confirmation of her
alleged title. In particular, the OSG claimed that Lot No.
8349 was classified as alienable and disposable land only
on March 15, 1982, as per Certification issued by the
DENR. Thus, petitioner and her predecessor-in-interest
could not have been in possession of the property since
June 12, 1945, or earlier. The OSG also pointed out that
the tax declarations presented by petitioner are fairly
recent and do not show petitioner and her predecessor-
in-interests nature of possession.Furthermore, the
original tracing cloth plan was not presented in evidence.
Ruling of the Court of Appeals
The CA reversed the RTC Judgment. It held that
petitioner failed to prove that she and her predecessor-
in-interest have been in possession and occupation of
the subject lot under a bonafide claim of ownership since
June 12, 1945. Thus:
In granting the application for registration of title, the
court a quo merely relied on the deed of sale executed
by Julian Gonzales, in favor of applicant-appellee on
February 1, 1993, the tax declarations and tax receipts. It
is interesting to note that Juana Gonzales, widow of
Julian Gonzales, after identifying the deed of sale
executed by her deceased husband in favor of applicant-
appellee, merely stated that the lot subject thereof was
inherited by Julian from his parents a long time ago and
that Julian was in possession of the lot since 1946 when
they started living together. For her part, applicant-
appellee testified that she immediately took possession
of the subject lot, which was planted with coffee, after
acquiring the same and that she is not doing anything on
the lot because it is not productive. As pointed out by
the Republic, applicant-appellee and Juana Gonzales
failed to specify what acts of development, cultivation,
and maintenance were done by them on the subject lot.
xxx
xxxx
In the case at bar, applicant-appellee merely claimed
that the subject lot is planted with coffee. However, no
evidence was presented by her as to who planted the
coffee trees thereon. In fact, applicant-appellee
admitted that she is not doing anything on the subject
lot because it is not productive, thereby implying that
she is not taking care of the coffee trees thereon.
Moreover, tax declarations and tax receipts are not
conclusive evidence of ownership but are merely indicia
of a claim of ownership, aside from the fact that the
same are of recent vintage.[27]
Hence, this petition.
Issues
Petitioners arguments
1) The testimony of Juana Gonzales proves that
petitioners predecessor-in-interest, Julian Gonzales,
occupied Lot No. 8349 even prior to 1946;
2) The fact that the property is planted with coffee, a
fruit bearing tree, reveals that the lot is planted,
cultivated and cared for. Thus, there was not only
effective and active possession and occupation but
actual cultivation and tending of the coffee plantation;
and
3) The fact that the land was declared for tax purposes as
early as 1957 shows that the land was actively possessed
and occupied by petitioner and her predecessor-in-
interest.
Respondents arguments:
1) Since Lot No. 8349 became part of
the alienable and disposable land only on March 15,
1982, petitioner could not have been considered as
having been in open, continuous, exclusive and
notorious possession and occupation of subject property
under a bona fide claim of ownership; and
2) There is no proof that petitioner or
Julian Gonzales undertook any clear act of dominion or
ownership over Lot No. 8349, since there are no
structures, improvements, or plantings on the property.
Our Ruling
The petition lacks merit.
Petitioner failed to prove open, continuous, exclusive and
notorious possession of the subject property.
In Director, Land Management Bureau v. Court of
Appeals,[28] we explained that
x x x The phrase "adverse, continuous, open, public,
peaceful and in concept of owner," by which
characteristics private respondent describes his
possession and that of his parents, are mere conclusions
of law requiring evidentiary support and substantiation.
The burden of proof is on the private respondent, as
applicant, to prove by clear, positive and convincing
evidence that the alleged possession of his parents was
of the nature and duration required by law. His bare
allegations without more, do not amount to
preponderant evidence that would shift the burden of
proof to the oppositor.
Here, we find that petitioners possession of the lot has
not been of the character and length of time required by
law. The relevant provision of the Property Registration
Decree relied upon by petitioner reads
SEC. 14. Who may apply. The following persons may file
in the proper Court of First Instance an application for
registration of title to land, whether personally or
through their duly authorized representatives:
(1) Those who by themselves or through their
predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of
alienable and disposable lands of the public domain
under a bona fide claim of ownership since June 12,
1945, or earlier.
(2) Those who have acquired ownership of private lands
by prescription under the provisions of existing laws. x x
x
Unfortunately, petitioner failed to prove that she and her
predecessor-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of
the subject property under a bona fide claim of
ownership since June 12, 1945.
First, there is nothing in the records which would
substantiate her claim that Julian Gonzales was in
possession of Lot No. 8349 since 1945, other than the
bare allegations of Juana Gonzales.[29] Certainly, these
unsubstantiated statements do not meet the required
quantum of evidence in land registration cases. In fact,
contrary to her testimony that her late husband
inherited the property from his parents a long time ago,
or even prior to 1945, the earliest tax declaration that
was presented in this case is one declared by Julian
Gonzales only in 1957 long after June 1945.
It bears stressing that petitioner presented only five tax
declarations (for the years 1957, 1961, 1967, 1980 and
1985) for a claimed possession and occupation of more
than 45 years (1945-1993). This type of intermittent and
sporadic assertion of alleged ownership does not
prove open, continuous, exclusive and notorious
possession and occupation. In any event, in the absence
of other competent evidence, tax declarations do not
conclusively establish either possession or declarants
right to registration of title.[30]
Petitioner failed to prove possession in the concept of an
owner.
Second, and more importantly, we agree with the CA
that petitioner was unable to demonstrate that the
alleged possession was in the concept of an owner, since
she could not point to any acts of occupation,
development, cultivation or maintenance over the
property. Petitioner claims that because the property is
planted with coffee, a fruit-bearing tree, it automatically
follows that the lot is cultivated, showing actual
possession and occupation. However, petitioner failed to
explain who planted the coffee, whether these plants
are maintained or harvested or if any other acts were
undertaken by petitioner or her predecessor-in-interest
to cultivate the property.
Even if we were to assume that the coffee was planted
by petitioners predecessor-in-interest, mere casual
cultivation of the land does not amount to exclusive and
notorious possession that would give rise to
ownership.[31] The presence of an unspecified number of
coffee plants, without proof that petitioner or her
predecessor-in-interest actually and deliberately
cultivated them is not sufficient to support a claim of
title. In fact, the five tax declarations in the name of
Julian Gonzales described the lot as unirrigated
riceland. No improvements or plantings were declared
or noted in any of these tax declarations. It was only in
petitioners 1993 tax declaration that the land was
described as planted with coffee. We are, therefore,
constrained to conclude that the mere existence of an
unspecified number of coffee plants, sans any evidence
as to who planted them, when they were planted,
whether cultivation or harvesting was made or what
other acts of occupation and ownership were
undertaken, is not sufficient to demonstrate petitioners
right to the registration of title in her favor.
WHEREFORE, the petition is DENIED. The Court of
Appeals April 28, 2006 Decision in CA-G.R. CV No. 76519
and its Resolution dated April 3, 2007 denying
petitioners Motion for Reconsideration are
both AFFIRMED.
SO ORDERED.
JESUS CAMPOS and ROSEMARIE G.R. No. 175994
CAMPOS-BAUTISTA,
Petitioners,

- versus - Present:

NENITA BUENVENIDA PASTRANA,

ROGER BUENVENIDA, CARPIO,* J., Chairperson,
SONIA BUENVENIDA, LEONARDO-DE CASTRO,**
TEDDY BUENVENIDA, BRION,
VICTOR BUENVENIDA, DEL CASTILLO, and
HARRY BUENVENIDA, ABAD, JJ.
MILDRED BUENVENIDA,
MANOLITO BUENVENIDA
and DAISY BUENVENIDA,
represented by their Attorney-in-Fact Promulgated:
CARLITO BUENVENIDA,***
Respondents. December 8, 2009
x - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x as CAR Case No. 1196 (Agrarian Case) against his
lessor. After trial, the Regional Trial Court of Roxas City,
DECISION Branch 14, found that Carlito was not an agricultural
tenant. He then appealed to the CA and subsequently to
DEL CASTILLO, J.: this Court, but was unsuccessful.

It sometimes happens that a creditor, after securing a
judgment against a debtor, finds that the debtor had
transferred all his properties to another leaving nothing
to satisfy the obligation to the creditor. In this petition
for review on certiorari,[1] petitioners ask us to set aside
the November 23, 2005 Decision[2] of the Court of
Appeals (CA) in CA-G.R. CV No. 68731 declaring as null
the sale of several parcels of land made by their parents
in their favor, for being absolutely simulated
transactions. Also assailed is the November 21,
2006 Resolution.[3]
Factual antecedents
This is the third case between essentially the same
parties and the second among those cases to reach this
Court on appeal, spanning a period of close to three
decades.
The first case arose from the refusal of Carlito Campos
(Carlito), the father of herein petitioners, to surrender
the possession of a fishpond he leased from respondents
mother, Salvacion Buenvenida, despite the expiration of
their contract of lease in 1980. Alleging that he was an
agricultural lessee, Carlito filed an agrarian case docketed
While the appeal in the Agrarian Case was pending
before the CA, herein respondents filed the second
case, Civil Case No. V-5417, against Carlito for Recovery
of Possession and Damages with Preliminary Mandatory
Injunction (Possession Case) involving the same fishpond
subject of the earlier agrarian case. On November 27,
1990, the Regional Trial Court of Roxas City, Branch 16,
rendered a Decision[4] finding Carlito to have retained
possession of the fishpond notwithstanding the
expiration of the contract of lease and ordering him to
pay rentals, the value of the produce and damages to
the herein respondents. The Decision became final and
executory and a Writ of Execution[5] was issued
on February 7, 1995. Subsequently, on September 19,
1995, an Alias Writ of Execution[6] was also issued. Both
were returned unsatisfied as per Sheriffs Return of
Service dated November 14, 1995.
During the pendency of the Agrarian Case, as well as
prior to the filing of the Possession Case, Carlito was the
registered owner of the following properties:
1. Residential Lots 3715-A and 3715-B-2 covered by
Transfer Certificates of Title Nos. 18205[7] and
18417,[8] respectively and

2. Agricultural Lots 850 and 852 covered by Original
Certificates of Title
Nos. P-9199[9] and P-9200,[10] respectively.
When the respondents were about to levy these
properties to satisfy the judgment in the Possession
Case, they discovered that spouses Carlito and Margarita
Campos transferred these lots to their children
Rosemarie and Jesus Campos, herein petitioners, by
virtue of Deeds of Absolute Sale dated October 18,
1985[11] and November 2, 1988.[12] Specifically, spouses
Campos sold the residential lots (Lots 3715-A and 3715-
B-2), with a total area of 1,393 square meters, to their
daughter Rosemarie for P7,000.00 and the agricultural
lots (Lots 850 and 852) with a combined area of 7,972
square meters, to their son Jesus for P5,600.00.
Proceedings before the Regional Trial Court
Civil Case No. V-7028
On February 18, 1997, respondents instituted the third
case, Civil Case No.
V-7028 (Nullity of Sale Case),[13] subject of this appeal,
seeking to declare as null the aforesaid deeds of sale and
the transfer certificates of title issued pursuant
thereto. They alleged that the contracts of sale between
spouses Campos and petitioners were simulated for the
sole purpose of evading the levy of the abovementioned
properties in satisfaction of a money judgment that
might be rendered in the Possession Case.
In their Answer with
Counterclaim,[14] spouses Campos and petitioners
averred that Rosemarie and Jesus Campos acquired the
lots in question in good faith and for value because they
were sold to them before they had any notice of the
claims or interests of other persons thereover.
On August 21, 2000,
the Regional Trial Court of Roxas City, Branch 14,
[15]
dismissed the complaint. It held that
In the Resolution of this case the issue is whether or not
the spouses Carlito Campos and Margarita Arduo,
sensing that an unfavorable judgment might be
rendered against them in Civil Case No. V-5417 filed in
Branch 16 on July 17, 1987 by the same plaintiffs for
Recovery of Possession and Damages with Preliminary
Mandatory Injunction, in evident bad faith and wanton
disregard of the law, maliciously and fraudulently,
executed a purely fictitious and simulated sale of their
properties thereby ceding and transferring their
ownership thereto to their children Rosemarie Campos-
Bautista and Jesus Campos.
A close scrutiny of the defendants documentary exhibits
and testimonies showed that as early as 1981 defendant
Jesus Campos was already leasing a fishpond in Brgy.
Majanlud, Sapi-an, Capiz from Victorino Jumpay and
defendant Rosemarie Campos was engaged in the sari-
sari store business starting 1985 so that they were able
to purchase the properties of their parents out of their
profits derived therefrom.
The Deed of Absolute Sale (Exh. 6 & 10) executed by the
spouses Carlito Campos and Margarita Arduo to
Rosemarie Campos and Jesus Campos were
dated October 17, 1985 and November 2, 1988,
respectively.
It can readily [be] gleaned from the records that Civil
Case No. V-5417 was filed on July 7, 1987 and was
decided on November 27, 1990. Furthermore, the alias
writ of execution was issued only on July 5, 1995 for
which the Sheriffs Return of Service was returned
unsatisfied on November 14, 1995.
WHEREFORE, the complaint of the plaintiffs against the
defendants is DISMISSED. Their claim for damages is
likewise DISMISSED. The counter-claim of the
defendants must also be DISMISSED as the case was not
filed in evident bad faith and with malicious intent.
SO ORDERED.[16]
Proceedings before the Court of Appeals
Upon review of the evidence presented, the CA found
that the conveyances were made in 1990, and not in
1985 or 1988, or just before their actual registration with
the Registry of Deeds, evidently to avoid the properties
from being attached or levied upon by the
respondents. The CA likewise noted that the zonal value
of the subject properties were much higher than the
value for which they were actually sold. The appellate
court further observed that despite the sales,
spouses Campos retained possession of the properties in
question. Finally, the CA took note of the fact that the
writ of execution and alias writ issued in the Possession
Case remained unsatisfied as the lower court could not
find any other property owned by the
spouses Campos that could be levied upon to satisfy its
judgment, except the parcels of land subject of the
assailed transactions.
On these bases, the CA ruled that the assailed contracts
of sale were indeed absolutely simulated transactions
and declared the same to be void ab initio. The
dispositive portion of the Decision of the CA reads:
WHEREFORE, the instant appeal is GRANTED. The
decision of the Regional Trial Court of Roxas City, Branch
14, dated August 21, 2000 in Civil Case No. V-7028 is
REVERSED and SET ASIDE. Let a copy of this Decision be
furnished to the Register of Deeds of
the Province of Capiz who is hereby ordered to cancel
Transfer Certificates of Title Nos. T-26092 and T-26093 in
the name of Rosemarie Campos, and Transfer
Certificates of Title Nos. T-23248 and 23249 in the name
of Jesus Campos and restore said titles in the name of
the previous owner, Carlito Campos.
SO ORDERED.
Only petitioners moved for reconsideration[17] but the CA
denied the same.[18]
Issues
Hence, this petition for review on certiorari raising the
following errors:
I.
THE COURT OF APPEALS COMMITTED AN ERROR OF
LAW IN APPLYING ARTICLE 1409, CIVIL CODE, INSTEAD
OF ARTICLE 1381 (3), CIVIL CODE, AND IN SPECULATING
THAT A CAUSE OF ACTION OF SUPPOSED SALE IN FRAUD
OF CREDITORS EXISTS DESPITE NON-EXHAUSTION OF
REMEDIES TO ENFORCE THE JUDGMENT IN CIVIL CASE
NO. V-5417.
II.
THE COURT OF APPEALS COMMITTED AN ERROR OF
LAW OVERLOOKING THAT THE CAUSE OF ACTION HAD
PRESCRIBED, THE COMPLAINT HAVING BEEN FILED
AFTER SEVEN (7) YEARS OR ONLY ON 14 OCTOBER 1997,
FROM THE TIME THE TITLES WERE ISSUED IN 1990.
III.
THE COURT OF APPEALS ERRONEOUSLY ANCHORED ITS
IMPUGNED JUDGMENT ON MISAPPREHENSION OF
FACTS THAT THE SALE WERE ANTEDATED, HENCE
SIMULATED DESPITE GLARING ABSENCE OF EVIDENCE
IN SUPPORT THEREOF.
IV.
THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF
DISCRETION IN CASTING ASIDE OVERWHELMING
EVIDENCE DULY APPRECIATED BY THE TRIAL COURT
THAT PETITIONERS ARE BUYERS IN GOOD FAITH AND
FOR VALUE, WHO EXERCISED DOMINION OVER THE
SUBJECT LOTS, WHICH IF PROPERLY CONSIDERED, SHALL
WARRANT THE SINGULAR CONCLUSION THAT THE SALE
AND TRANSFER OF TITLES ARE VALID.[19]
Petitioners arguments
Petitioners assail the application of Article 1409[20] of the
Civil Code on void
contracts as against Article 1381(3)[21] of the Civil Code
on rescissible contracts in fraud of creditors, considering
that the questioned conveyances executed by the
spouses Campos to their children were allegedly done to
evade the enforcement of the writ of execution in the
Possession Case.[22] In addition, petitioners allege that
the CA misappreciated the facts of this case when it
found that the questioned transactions were tainted
with badges of fraud.[23]
Respondents arguments
Respondents argue that the application of Article 1409
on void contracts was a natural and logical consequence
of the CAs finding that subject deeds of sale were
absolutely simulated and fictitious, consistent with the
nature of the respondents cause of action which was for
declaration of nullity of said contracts and the transfer
certificates of titles issued pursuant
[24]
thereto. Respondents also stressed that the CAs
finding is conclusive upon us and that only questions of
law may be raised in a petition for review
on certiorari under Rule 45 of the Rules of Court.[25]
 Our Ruling
The petition lacks merit.
Well-settled is the rule that this Court is not a trier of
facts. When supported by substantial evidence, the
findings of fact of the CA are conclusive and binding, and
are not reviewable by this Court, unless the case falls
under any of the following recognized exceptions:
(1) When the conclusion is a finding grounded entirely
on speculation, surmises and conjectures;
(2) When the inference made is manifestly mistaken,
absurd or impossible;
(3) Where there is a grave abuse of discretion;
(4) When the judgment is based on a misappreciation of
facts;
(5) When the findings of fact are conflicting;
(6) When the CA in making its findings, went beyond the
issues of the case and the same is contrary to the
admissions of both appellant and appellee;
(7) When the findings are contrary to those of the trial
court;
(8) When the findings of fact are conclusions without
citation of specific evidence on which they are based;
(9) When the facts set forth in the petition as well as in
the petitioners main and reply briefs are not disputed by
the respondents; and
(10) When the findings of fact of the CA are premised on
the supposed absence of evidence and contradicted by
the evidence on record.
None of these exceptions is present in this case. We find
that the Decision of the CA is supported by the required
quantum of evidence.
The subject Deeds of Absolute Sale executed by the
Spouses Campos to their children (herein petitioners) are
absolutely simulated and fictitious.
The CA correctly held that the assailed Deeds of Absolute
Sale were executed when the Possession Case was
already pending, evidently to avoid the properties
subject thereof from being attached or levied upon by
the respondents. While the sales in question transpired
on October 18, 1985 and November 2, 1988, as reflected
on the Deeds of Absolute Sale, the same were registered
with the Registry of Deeds only on October 25,
1990 and September 25, 1990.
We also agree with the findings of the CA that
petitioners failed to explain the reasons for the delay in
the registration of the sale, leading the appellate court to
conclude that the conveyances were made only in 1990
or sometime just before their actual registration and that
the corresponding Deeds of Absolute Sale were
antedated. This conclusion is bolstered by the fact that
the supposed notary public before whom the deeds of
sale were acknowledged had no valid notarial
commission at the time of the notarization of said
documents.[26]
Indeed, the Deeds of Absolute Sale were executed for
the purpose of putting the lots in question beyond the
reach of creditors. First, the Deeds of Absolute Sale were
registered exactly one month apart from each other and
about another one month from the time of the
promulgation of the judgment in the Possession
Case. The Deeds of Absolute Sale were antedated and
that the same were executed when the Possession Case
was already pending.
Second, there was a wide disparity in the alleged
consideration specified in the Deeds of Absolute Sale and
the actual zonal valuation of the subject properties as
per the BIR Certification, as follows:
Considera Market Computed
tion Value as Zonal
specified per Tax Valuation
in Deed Declaratio (BIR
of n Certificatio
Absolute n)
Sale
Residen
 tial Lots: P 7,000.0 P 83,580. P 417,900. Finally, spouses Campos continue to be in actual
From 0 00[27] 00[28] possession of the properties in question. Respondents
Spouses have established through the unrebutted testimony of
Campos Rolando Azoro that spouses Campos have their house
to within Lot 3715-A and Lot 3715-B-2 and that they reside
daughte there together with their daughter Rosemarie.[34] In
r, addition, spouses Campos continued to cultivate the rice
Rosema lands which they purportedly sold to their son
rie Jesus.[35] Meantime, Jesus, the supposed new owner of
Campos said rice lands, has relocated to Bulacan[36] where he
Agricult worked as a security guard.[37] In other words, despite
ural P 5,600.0 P 25,000. P 39,860.0 the transfer of the said properties to their children, the
Lots: 0 19[29] 0[30] latter have not exercised complete dominion over the
From same. Neither have the petitioners shown if their
Spouses parents are paying rent for the use of the properties
Campos which they already sold to their children.
to son,
Jesus In Suntay v. Court of Appeals,[38] we held that:
Campos
The failure of the late Rafael to take exclusive possession
As correctly noted by the CA, the appraised value of the of the property allegedly sold to him is a clear badge of
properties subject of this controversy may be lower at fraud. The fact that, notwithstanding the title transfer,
the time of the sale in 1990 but it could not go lower Federico remained in actual possession, cultivation and
than P7,000.00 and P5,600.00. We likewise find the occupation of the disputed lot from the time the deed of
considerations involved in the assailed contracts of sale sale was executed until the present, is a circumstance
to be inadequate considering the market values which is unmistakably added proof of the fictitiousness
presented in the tax declaration and in the BIR zonal of the said transfer, the same being contrary to the
valuation. principle of ownership.

Third, we cannot believe that the buyer of the 1,393-
square meter[31] residential land could not recall the
exact area of the two lots she purchased. In her cross-
examination, petitioner Rosemarie Campos stated:
Q: Can you tell us the total area of those two (2) lots that
they sold to you?
A: It consists of One Thousand (1,000) Square Meters.[32]
xxxx
Q: By the way, for how much did you buy this [piece] of
land consisting of 1,000 square meters?
A: Seven Thousand Pesos (P7,000.00) Your Honor.[33]
Fourth, it appears on record that the money judgment in
the Possession Case has not been discharged with. Per
Sheriffs Service Return dated November 14, 1995, the
Alias Writ of Execution and Sheriffs Demand for Payment
dated September 19, 1995 remain unsatisfied.
While in Spouses Santiago v. Court of Appeals,[39] we held
that the failure of petitioners to take exclusive
possession of the property allegedly sold to them, or in
the alternative, to collect rentals from the alleged vendor
x x x is contrary to the principle of ownership and a clear
badge of simulation that renders the whole transaction
void and without force and effect, pursuant to Article
1409 of the Civil Code.
The issuance of transfer certificates of title to petitioners
did not vest upon them ownership of the properties.
The fact that petitioners were able to secure titles in
their names did not operate to vest upon them
ownership over the subject properties. That act has
never been recognized as a mode of acquiring
ownership.[40] The Torrens system does not create or
vest title. It only confirms and records title already
existing and vested. It does not protect a usurper from
the true owner. It cannot be a shield for the commission
of fraud.[41]
In the instant case, petitioner Rosemarie Campos
supposedly bought the residential properties in 1985 but
did not have the assailed Deed of Absolute Sale
registered with the proper Registry of Deeds for more
than five years, or until a month before the
promulgation of the judgment in the Possession
Case. Hence, we affirm the finding of the CA that the
purported deed was antedated. Moreover, her failure to
take exclusive possession of the property allegedly sold,
or, alternatively, to collect rentals is contrary to the
principle of ownership and a clear badge of
simulation. On these grounds, we cannot hold that
Rosemarie Campos was an innocent buyer for value.
Likewise, petitioner Jesus Campos supposedly bought
the rice land from his parents in 1988 but did not have
the assailed Deed of Absolute Sale registered with the
proper Registry of Deeds for more than two years, or
until two months before the promulgation of the
judgment in the Possession Case. Thus, we likewise
affirm the finding of the CA that the purported deed was
antedated. In addition, on cross, he confirmed that he
had knowledge of the prior pending cases when he
supposedly purchased his parents rice land stating that:
Q: You never knew that your parents and the plaintiffs in
this case have cases in the past prior to this case now, is
that right?
A: Yes, sir. I knew about it.
Q: And in spite of your knowledge, that there was a
pending case between your parents and the plaintiffs
here, you still purchased these two (2) lots 850 and 852
from your parents, is that what you are telling us?
A: All I knew was that, that case was a different case
from the subject matter then [sic] the lot now in
question.[42]
On these findings of fact, petitioner Jesus Campos
cannot be considered as an innocent buyer and for
value.
Since both the transferees, Rosemarie and Jesus
Campos, are not innocent purchasers for value, the
subsequent registration procured by the presentation of
the void deeds of absolute sale is likewise null and void.
The action for the declaration of the inexistence of the
assailed Deeds of Absolute Sale does not prescribe.
Petitioners argue that respondents cause of action had
prescribed when they filed the Nullity of the Sale Case
on October 14, 1997, or seven years after the
registration of the questioned sales in 1990.
We cannot agree. As discussed above, the sale of subject
properties to herein petitioners are null and void. And
under Article 1410 of the Civil Code, an action or defense
for the declaration of the inexistence of a contract is
imprescriptible. Hence, petitioners contention that
respondents cause of action is already barred by
prescription is without legal basis.
Since the assailed Deeds of Absolute Sale are null and
void, the Civil Code provisions on rescission have no
application in the instant case.
Finally, petitioners argument that the applicable law in
this case is Article 1381(3) of the Civil Code on rescissible
contracts and not Article 1409 on void contracts is not a
question of first impression. This issue had already been
settled several decades ago when we held that an action
to rescind is founded upon and presupposes the
existence of a contract.[43] A contract which is null and
void is no contract at all and hence could not be the
subject of rescission.[44]
In the instant case, we have declared the Deeds of
Absolute Sale to be fictitious and inexistent for being
absolutely simulated contracts. It is true that the CA cited
instances that may constitute badges of fraud under
Article 1387 of the Civil Code on rescissible contracts. But
there is nothing else in the appealed decision to indicate
that rescission was contemplated under the said
provision of the Civil Code. The aforementioned badges
must have been considered merely as grounds for
holding that the sale is fictitious. Consequently, we find
that the CA properly applied the governing law over the
matter under consideration which is Article 1409 of the
Civil Code on void or inexistent contracts.
WHEREFORE, the petition is DENIED. Costs against
petitioners.
SO ORDERED.
LYNN PAZ T. DELA G.R. No. 161929 Resolution[2] in Criminal Case No. 26042, which ordered
CRUZ, petitioners suspension pendente lite and its (2) February
FERNANDO SERRANO, 5, 2004 Resolution,[3] which denied petitioners motion
NATHANIEL LUGTU, for reconsideration.
and
JANET S. PINEDA, Present: Factual Antecedents
Petitioners,
CARPIO,* J., Chairperson, The instant criminal complaint arose from the
- versus - LEONARDO-DE CASTRO,** construction and/or renovation project involving several
BRION, multi-purpose halls located in various barangays in the
SANDIGANBAYAN, DEL CASTILLO, and City of Tarlac. Upon post audit, the Provincial Auditor of
THE the Commission on Audit (COA) issued Notice of
SPECIAL PROSECUTOR ABAD, JJ. Disallowance No. 99-001-100(98) dated January 29,
and 1999 and Notice of Disallowance No. 99-003-101(98)
THE PEOPLE OF THE dated July 22, 1999 on the ground that what were
PHILIPPINES, Promulgated: actually constructed and/or renovated
Respondents. December 8, 2009 were barangay chapels in violation of Section
x--------------------------------------------- 29(2),[4] Article VI of the Constitution and Section
----------------------x 335[5] of the Local Government Code prohibiting public
expenditure for religious purposes.[6] On February 6,
1998, private complainants Jesus B. David and Ana
DECISION Alamo Aguas filed a complaint with the Office of the
Ombudsman in connection with the approval and
DEL CASTILLO, J.: implementation of the aforesaid projects against several
local government officials of the City of Tarlac, namely:
The principle of the law of the case is an established rule
in this jurisdiction. Thus, when an appellate court passes Gelacio R. Manalang- Mayor
on a question and remands the case to the lower court Alfredo D. Baquing- Engineer
for further proceedings, the question there settled Nathaniel B. Lugtu- Accountant
becomes the law of the case upon subsequent appeal. Lynn Paz T. Dela Cruz- Assistant Accountant
The court reviewing the succeeding appeal will not re- Fernando L. Serrano- Budget Officer
litigate the case but instead apply the ruling in the Janet S. Pineda- Planning & Development Officer
previous appeal. This enables the appellate court to
perform its duties satisfactorily and efficiently which for violation of Section 3(e)[7] of Republic Act (RA) No.
would be impossible if a question, once considered and 3019[8] or The Anti-Graft and Corrupt Practices Act. In his
decided by it, were to be litigated anew in the same case July 13, 1999 Resolution,[9] the Ombudsman dismissed
and upon any and subsequent appeal.[1] While the the complaint for insufficiency of evidence and
applicability of this principle in this case is prematurity. On September 8, 1999, private
straightforward, the cunning attempt of the parties to complainants moved for reconsideration. As a result, the
evade the application thereof is what we unequivocally Ombudsman referred the case to the Office of the Chief
deplore here. The accused often decry the snail pace of Legal Counsel for review and recommendation. In its
the administration of justice but when they themselves April 13, 2000 Memorandum,[10] the Office of the Chief
give cause for the delay, they have no reason to Legal Counsel recommended that the corresponding
complain. We again remind the parties and their information be filed against the aforesaid local officials
counsels to act with candor and not to test the patience because there is probable cause to hold them liable for
of this Court. violation of the anti-graft law. Acting favorably thereon,
on May 16, 2000, the Ombudsman issued an
This is a Petition for Certiorari and Prohibition assailing Order[11] directing the Office of the Special Prosecutor to
the Sandiganbayans (1) December 8, 2003
file the necessary information with
the Sandiganbayan, viz:
That sometime on 6 February 1998 or thereabouts, in
the City of Tarlac, province of Tarlac, Philippines and
within the jurisdiction of this Honorable Court, accused
Gelacio R. Manalang, Alfredo D. Baquing, Lynn Paz T.
dela Cruz, Fernando Serrano, Nathaniel Lugtu and Janet
S. Pineda, accused Gelacio R. Manalang being the mayor
of Tarlac City, Tarlac, a high ranking officer pursuant to
R.A. 8249 in relation to Sec. 455(d) of R.A. 7160, and all
the other accused then occupying different positions in
the government of Tarlac City, conspiring and
confederating with one another, committing the crime
herein charged in relation to their office, taking
advantage of their official position, acting with evident
bad faith and manifest partiality, or gross inexcusable
negligence, did then and there, wilfully, unlawfully and
criminally, cause undue injury to the government and
give unwarranted benefits, advantage or preference to a
specific group of constituents by approving and releasing
the amount of Five Hundred Forty Three Thousand Eight
Hundred Pesos (P543,800.00) for the construction of the
multi-purpose halls in barangays Sapang Tagalog, Sapang
Maragul and Dalayap in Tarlac City despite the fact, as
Accused knew fully well, that what were being
constructed are in truth chapels which would serve
private purposes, and not barangay multi-purpose halls
and, thereafter, proceeded to implement such
construction.[12]
The case was docketed as Criminal Case No. 26042 and
raffled to the Fourth Division. The accused then moved
for reinvestigation on the ground that they were not
given an opportunity to be heard when the Ombudsman
reversed his earlier finding of lack of probable cause.
In its July 17, 2000 Order,[13] the Sandiganbayan granted
the motion and gave the prosecution 20 days to re-
evaluate the evidence and submit a report to the
court. On July 31, 2001, the prosecution filed a
Manifestation[14] with the Sandiganbayan that after
conducting its reinvestigation, it found probable cause to
charge the accused with violation of the anti-graft law
and prayed that the case be set for arraignment. As a
consequence, the Sandiganbayan in its August 8, 2001
Resolution[15] set the case for arraignment and pre-trial.
Undeterred, the accused filed separate motions[16] to
quash the information and/or to dismiss the case. On
April 24, 2003, the Sandiganbayan issued a
Resolution[17] which denied all of the aforesaid motions
and upheld the validity of the subject information. It
ruled that the information contained sufficient
allegations to charge the accused with violation of
Section 3(e) of RA No. 3019, that there exists probable
cause to indict the accused and that the motions raise
factual issues that cannot be resolved without an
adversarial proceeding.
The accused then moved for reconsideration which was
denied by the Sandiganbayan in its June 2, 2003
Resolution.[18] In addition to the reasons stated in its April
24, 2003 Resolution, the Sandiganbayan held that there
was no violation of the right of the accused to due
process based on the records forwarded to the court by
the Ombudsman.
On May 12, 2003, the accused were arraigned and
pleaded not guilty.[19] The prosecution subsequently filed
a motion[20] to suspend the accused pendente lite.
On June 10, 2003, the accused filed a consolidated
petition for certiorari and prohibition before this Court
against public respondents Fourth Division of
the Sandiganbayan, the Ombudsman and the People of
the Philippines. They ascribed grave abuse of discretion
on the public respondents for filing the information and
upholding the validity of the same despite the violation
of the right of the accused to due process and the patent
lack of probable cause. On June 17, 2003, we resolved to
dismiss the petition for lack of merit.
Sandiganbayans Ruling
On December 8, 2003, the Sandiganbayan issued the
assailed Resolution which granted the prosecutions
motion and ordered the preventive suspension of the
accused for a period of 90 days. It ruled that the validity
of the information has been previously settled in its April
24, 2003 Resolution. Thus, under Section 13 of RA No.
3019, the preventive suspension of the accused
becomes mandatory. Petitioners thereafter filed a
motion for reconsideration which was denied by
the Sandiganbayan in its February 5, 2004 Resolution.
From the aforesaid adverse rulings, only accused Dela
Cruz, Serrano, Lugtu and Pineda (petitioners) sought
review before this Court via the instant petition for
prohibition and certiorari under Rule 65 of the Rules of
Court.
Issues
Petitioners raise the following issues for our resolution:
1. Whether the subject criminal case was
prematurely instituted considering the pendency of
petitioners appeals before the COA En Banc.
2. Whether the Ombudsman may still reconsider
his Resolution dated July 13, 1999, dismissing the
complaint, after the same has already become final and
executory.
3. Whether the subject information is fatally
defective.
4. Whether, on the basis of the admitted or
undisputed facts, there is probable cause to prosecute
petitioners and their co-accused for violation of Section
3(e) of RA No. 3019.[21]
Petitioners Arguments
First, petitioners claim that they have been exonerated
by the COA En Banc, thus, there is no more basis to
prosecute them for violation of the anti-graft law. The
filing of the subject criminal case against them was based
on the results of a post-audit showing the alleged illegal
disbursement of public funds for religious purposes.
Consequently, the Provincial Auditor issued notices of
disallowance against petitioners and their co-accused
Manalang and Baquing. Petitioners thereafter appealed
from said notices. Considering that these cases were still
on appeal before the COA En Banc, the Ombudsman
gravely abused his discretion when he ordered the filing
of the subject criminal case against petitioners and their
co-accused.
Moreover, in the interim and after a series of separate
appeals, petitioners Lugtu, Dela Cruz and Serrano were
exonerated by the COA En Banc on the common ground
that as Accountant, Assistant Accountant and Budget
Officer, respectively, they did not take part in the review
of the plans and specifications as well as in the
implementation, prosecution and supervision of the
subject construction and/or renovation project. As for
petitioner Pineda, no notice of disallowance was ever
issued to her. Thus, with more reason subject criminal
case should be dismissed in order to save petitioners
from an expensive and vexatious trial.
In the same vein, there is no probable cause to hold
petitioners liable for violation of the anti-graft law
because the Ombudsman himself admitted that what
were built were multi-purpose halls and not chapels in
his November 16, 1999 Decision in OMB-ADM-1-99-
0759 which absolved petitioners co-accused Baquing
from administrative liability.
Second, petitioners contend that the subject information
is fatally defective because of the irregularities and due
process violations committed during the preliminary
investigation of this case. The Ombudsman acted
without jurisdiction when he reversed his July 13, 1999
Resolution, which dismissed the criminal complaint,
considering that this resolution had long become final
and executory. Assuming that private complainants
timely moved for reconsideration, the same was
defective for failure to furnish all the accused with copies
of said motion. The information should, thus, have been
quashed under Section 3(d)[22] of Rule 117 of the Rules of
Court for lack of authority of the Ombudsman to file the
same.
Finally, petitioners argue that the allegations in the
subject information do not constitute an offense
because the alleged specific group that was benefited by
the construction and/or renovation of
the barangay chapels as well as the alleged private
purposes served thereby were sufficiently identified and
described. Hence, the right of the accused to be
informed of the nature and cause of the accusation
against them was violated.
Respondents Arguments
First, respondents counter that the COA is not vested
with jurisdiction to determine the criminal liability of
petitioners. Its power is limited to the determination of
the violation of its accounting and auditing rules and
regulations. Hence, the COA En Bancs exclusion of
petitioners from liability under the notices of
disallowance only relates to the administrative aspect of
their accountability. This, however, does not foreclose
the Ombudsmans authority to investigate and
determine whether there is a crime to be prosecuted.
For similar reasons, the exoneration of Baquing from
administrative liability by the Ombudsman in his
November 16, 1999 Decision in OMB-ADM-1-99-0759,
specifically, the finding therein that what were
constructed were multi-purpose halls and not chapels is
not binding on the subject criminal case against
petitioners and their co-accused. The dismissal of an
administrative case does not necessarily bar the filing of
a criminal prosecution for the same or similar acts which
were the subject of the administrative complaint.
Second, respondents aver that there was no denial of
due process during the preliminary investigation stage.
Private complainants timely moved for reconsideration
from the July 13, 1999 Resolution of the Ombudsman.
They received a copy of the aforesaid Resolution on
August 25, 1999 and filed a letter seeking
reconsideration on September 8, 1999 or within the 15-
day reglementary period under the Rules of Procedure
of the Ombudsman. The Sandiganbayan also found that
there was no due process violation as borne out by the
records forwarded to said court by the
Ombudsman. Further, any defect in the preliminary
investigation should be deemed cured because
the Sandiganbayan ordered the reinvestigation of this
case in its July 17, 2000 Order. After the reinvestigation,
the Ombudsman maintained that there is probable
cause to indict petitioners and their co-accused. This was
affirmed by the Sandiganbayan when it set the case for
arraignment and pre-trial.
Finally, respondents assert that the identity of the
specific group and the private purposes served by the
subject construction and/or renovation project are
evidentiary matters that should be threshed out during
the trial on the merits of this case.
Our Ruling
The petition lacks merit.
The preventive suspension of the accused under Section
13 of RA No. 3019 is mandatory upon a finding that the
information is valid.
Section 13 of RA No. 3019 provides:
Section 13. Suspension and loss of benefits - Any public
officer against whom any criminal prosecution under a
valid information under this Act or under the provisions
of the Revised Penal Code on bribery is pending in court,
shall be suspended from office. Should he be convicted
by final judgment, he shall lose all retirement or gratuity
benefits under any law, but if he is acquitted, he shall be
entitled to reinstatement and to the salaries and benefits
which he failed to receive during suspension, unless in
the meantime administrative proceedings have been
filed against him.
Pursuant to this provision, it becomes mandatory for the
court to immediately issue the suspension order upon a
proper determination of the validity of the
information.[23] The court possesses no discretion to
determine whether a preventive suspension is necessary
to forestall the possibility that the accused may use his
office to intimidate witnesses, or frustrate his
prosecution, or continue committing malfeasance. The
presumption is that unless the accused is suspended, he
may frustrate his prosecution or commit further acts of
malfeasance or do both.[24]
In Luciano v. Mariano,[25] we laid down the guidelines for
the exercise of the courts power to suspend the accused:
(c) By way of broad guidelines for the lower courts in the
exercise of the power of suspension from office of public
officers charged under a valid information under the
provisions of Republic Act 3019 or under the provisions
of the Revised Penal Code on bribery, pursuant to
Section 13 of said Act, it may be briefly stated that upon
the filing of such information, the trial court should issue
an order with proper notice requiring the accused officer
to show cause at a specific date of hearing why he
should not be ordered suspended from office pursuant
to the cited mandatory provisions of the Act. Where
either the prosecution seasonably files a motion for an
order of suspension or the accused in turn files a motion
to quash the information or challenges the validity
thereof, such show-cause order of the trial court would
no longer be necessary. What is indispensable is that the
trial court duly hear the parties at a hearing held for
determining the validity of the information, and
thereafter hand down its ruling, issuing the
corresponding order of suspension should it uphold the
validity of the information or withholding such
suspension in the contrary case.
(d) No specific rules need be laid down for such pre-
suspension hearing. Suffice it to state that the accused
should be given a fair and adequate opportunity to
challenge the validity of the criminal proceedings against
him, e.g. that he has not been afforded the right of due
preliminary investigation; that the acts for which he
stands charged do not constitute a violation of the
provisions of Republic Act No. 3019 or of the bribery
provisions of the Revised Penal Code which would
warrant his mandatory suspension from office under
Section 13 of the Act; or he may present a motion to
quash the information on any of the grounds provided in
Rule 117 of the Rules of Court. The mandatory
suspension decreed by the Act upon determination of
the pendency in court of a criminal prosecution for
violation of the Anti-graft Act or for bribery under a valid
information requires at the same time that the hearing
be expeditious, and not unduly protracted such as to
thwart the prompt suspension envisioned by the Act.
Hence, if the trial court, say, finds the ground alleged in
the quashal motion not to be indubitable, then it shall be
called upon to issue the suspension order upon its
upholding the validity of the information and setting the
same for trial on the merits.[26]
The issues proper for a pre-suspension hearing are, thus,
limited to ascertaining whether: (1) the accused had
been afforded due preliminary investigation prior to the
filing of the information against him, (2) the acts for
which he was charged constitute a violation of the
provisions of RA No. 3019 or of the provisions of Title 7,
Book II of the Revised Penal Code, or (3) the information
against him can be quashed under any of the grounds
provided in Section 2, Rule 117 of the Rules of Court.[27]
While ordinarily we would proceed to determine
whether the ruling of the Sandiganbayan upholding the
validity of the information and directing the preventive
suspension suffer from the vice of grave abuse of
discretion, the peculiar circumstances of this case
constrain us to dismiss the petition outright. As will be
discussed hereunder, all of the above issues proper in a
pre-suspension hearing were previously passed upon by
the Sandiganbayan and then by us via G.R. No.
158308. Petitioners conveniently failed to reveal that this
is the second time that they are appealing before us,
raising the same issues and arguments, via the instant
petition. The present recourse is, thus, but a futile
attempt to reopen settled rulings with the deplorable
consequence of delaying the prompt disposition of the
main case.
The validity of the subject information has been raised
and resolved in G.R. No. 158308. Under the principle of
the law of the case, this issue can no longer be re-
litigated.
Upon a review of the records of this case, we find that
the issue as to the validity of the information, inclusive of
all matters proper for a pre-suspension hearing, has
already been passed upon by us. As stated earlier, the
records indicate that on June 10, 2003, petitioners, along
with their co-accused Manalang and Baquing, filed a
consolidated petition for certiorari and prohibition
before this Court against public respondents Fourth
Division of the Sandiganbayan, the Ombudsman and the
People of the Philippines. This case was docketed as G.R.
No. 158308. Petitioners, Manalang and Baquing assailed
therein, for having been issued with grave abuse of
discretion, the following: (1) Sandiganbayans April 24,
2003 Resolution which upheld the validity of the
information charging them with violation of Section 3(e)
of RA No. 3019, (2) Sandiganbayans June 2, 2003
Resolution which denied petitioners, Manalang and
Baquings separate motions for reconsideration and (3)
Ombudsmans May 16, 2000 Order which directed the
Office of the Special Prosecutor to file the aforesaid
information.
In its April 24 and June 2, 2003 Resolutions,
the Sandiganbayan had earlier ruled, among others, that
the subject information contains sufficient allegations to
charge the accused with violation of the anti-graft law;
that there was no denial of due process during the
preliminary investigation stage; that there exists
probable cause to indict the accused; and that the
accuseds other arguments, including the pendency of
petitioners separate appeals before the COA En Banc,
lacked merit. On June 17, 2003, the Court En Banc issued
a Resolution dismissing the petition for failure to
sufficiently show that the public respondents committed
grave abuse of discretion in rendering the assailed
issuances and for having raised factual issues. This
Resolution became final and executory on July 31, 2003
as per the entry of judgment.[28]
The issues and arguments in the instant petition were SO ORDERED.
already included in the issues and arguments raised and
resolved in G.R. No. 158308.[29] The Court En Bancs June
17, 2003 Resolution should, thus, have put to rest the
issue of the validity of the subject information. Yet,
petitioners would have us now revisit the same issue in
the instant petition. This cannot be done. Under the
principle of the law of the case, when a question is
passed upon by an appellate court and the case is
subsequently remanded to the lower court for further
proceedings, the question becomes settled upon a
subsequent appeal. Whatever is once irrevocably
established as the controlling legal rule or decision
between the same parties in the same case continues to
be the law of the case, whether correct on general
principles or not, so long as the facts on which such
decision was predicated continue to be the facts of the
case before the court.[30] Thus, considering that the
validity of the information has long been settled in G.R.
No. 158308, the Sandiganbayan properly granted the
motion to suspend the accused pendente lite.

In conclusion, we note with deep disapproval the failure

of petitioners to properly apprise this Court of the
proceedings previously taken in G.R. No.
158308. Petitioners did not act forthrightly when they
omitted in their statement of facts that they had earlier
challenged the validity of the subject information before
the Sandiganbayan and this Court, which issue they now
seek to resuscitate in the instant petition. That the
accused should be allowed to arduously and zealously
defend his life, liberty and property is not in
question. But this is so only within the permissible limits
of the framework of our criminal laws and rules of
procedure. Indubitably, the accused should not give
ground for delay in the administration of criminal justice,
much less, hide from this Court the patent unworthiness
of his cause.

WHEREFORE, the petition is DISMISSED.

The Sandiganbayans December 8, 2003 Resolution,
which ordered petitioners suspension pendente lite and
February 5, 2004 Resolution, which denied petitioners
motion for reconsideration, are AFFIRMED. This case
is REMANDED to the Sandiganbayan for further
proceedings.

Treble costs against petitioners.

PEOPLE OF G.R. No. 174480 ___________, Municipality of Lopez, Province of
THE PHILIPPINES, Quezon, Philippines, and within the jurisdiction of this
Plaintiff-Appellee, Honorable Court, the above-named accused, an uncle
and a relative by consanguinity within the third civil
Present: degree of one Maria, armed with an ice-pick, with lewd
design, by means of force, threats and intimidation, did
CARPIO,* J., Chairperson, then and there willfully, unlawfully and feloniously have
- versus - LEONARDO-DE CASTRO,** carnal knowledge of one Maria, a minor, 12 years of age
BRION, against her will.
DEL CASTILLO, and
ABAD, JJ. Contrary to law.[3]

REYNALDO ALBALATE, Promulgated:
JR.,
Accused-Appellant. December 18, 2009
x---------------------------------------------
----------------------x
DECISION
DEL CASTILLO, J.:
Factual Antecedents
Appellant Reynaldo Albalate, Jr. was charged with two
counts of rape committed against his niece Maria.[1] The
accusatory portions of the two Informations read as
follows:
Crim. Case No. 3169-C:
That on or about the evening of the 21st day of
November 1998, at Barangay _____________,
Municipality of Lopez, Province of Quezon, Philippines,
and within the jurisdiction of this Honorable Court, the
above-named accused, an uncle and a relative by
consanguinity within the third civil degree of one Maria,
with lewd design, by means of force, threats and
intimidation, did then and there willfully, unlawfully and
feloniously have carnal knowledge of said Maria , a
minor, 12 years of age against her will.
Contrary to law.[2]
Crim. Case No. 3170-C:
That on or about the 21st day of November, 1998 at
around 8:00 oclock in the morning, at Barangay
Appellant pleaded not guilty when arraigned. Trial on the
merits thereafter ensued.
Ruling of the Regional Trial Court
On July 24, 2002, the Regional Trial Court of Calauag,
Quezon, Branch 63, rendered its Decision[4] finding the
appellant guilty. The trial court based its judgment of
conviction on the following factual findings:
This Court painstakingly scrutinized with great caution
the testimony of private complainant x x x and found the
same to be clear, straightforward, credible and
convincing. At the time when the rape incidents
happened [on] November 21, 1998, the victim x x x was,
as alleged by the prosecution, just a twelve (12) years old
barrio lass living in the house of her paternal
grandparents in Barangay x x x, Quezon. It was in the
said house where she was forcibly deflowered by her
uncle Reynaldo Albalate, Jr. on two separate incidents
that transpired on that fateful day of November 21,
1998. Maria candidly testified that in the morning of the
said day while she was alone in the house of her
grandparents, the accused Reynaldo Albalate, Jr. armed
with an ice pick forcibly removed her dress and placed
himself on top of her. Afterwards, Reynaldo Albalate, Jr.
inserted his penis in her private part and at the same
time kissed and warned her that if she will tell x x x
anybody what he had done to her, he will kill her x x
x. She added that on the evening of the same day
(November 21, 1998) the accused Reynaldo Albalate, Jr.
first boxed her, then undressed her and once again put
himself on top of her and proceeded to rape her. Maria
reported the rape incidents to her grandmother x x x
who is also the mother of the accused x x x but her
grandmother told her that she x x x was lying x x x. When
asked by the Court x x x whether she offered resistance
when she was raped by the accused x x x, the victim x x x
averred that nagpapalag po ako x x x. In the course of the
cross-examination conducted by the defense counsel,
the victim x x x even disclosed that when she was raped
by the accused x x x in the morning of November 21,
1998, she was alone in her grandmothers house because
she told her cousin Ruel x x x to tend [to] the
carabao. She added that when her cousin Ruel came
back, the latter saw that she was being raped by the
accused x x x. She also categorically testified that when
the accused proceeded to rape her, there was bleeding
in her vagina and she was hurt. When she urinated, it
was very painful. She pointed out that the subject rape
incident was her first sexual experience x x x.
On the other hand, the accused in order to exculpate
himself from the crime charged in the two Informations
interposed the defense of denial and alibi. Accused x x x
denied that he twice raped the victim x x x at about 8:00
oclock in the morning and about 9:00 oclock in the
evening of November 21, 1998 x x x. He also claimed
that the parents of the victim x x x were mad at him that
is why they filed the instant cases against him. Reynaldo
explained that when they were young, the victims father
was angry with him because of the sharing of copras in
their farm. One day, they had a fight and Marias father
chased and boxed him so he boxed the former. [The
other defense witness, Florentina Escleto, tried to bolster
the alleged innocence of the accused of the crimes.] The
said witness tried to establish the defense of alibi in favor
of the accused x x x. She testified that when the subject
incidents of rape happened on November 21, 1998 at
Barangay x x x, Quezon, the accused x x x was with her
and her son making copra at Barangay Ilayang Ilog-B,
Lopez, Quezon. She added that accused x x x arrived at
Brgy. Ilayang Ilog-B on November 18, 1998 and only left
said Barangay at the end of the month of November
1998 x x x. This Court carefully scrutinized and weighed
the defense of denial and alibi proffered by the accused
and was not persuaded by the same. The denial and alibi
of the accused deserve scant consideration. x x x
In the case at bar, accused x x x was positively identified
in a straightforward and categorical manner by the
victim x x x as the defiler of her womanhood on two
occasions on x x x November 21, 1998.Thus, the denial
and alibi interposed by the accused wilted and crumbled
in the face of such positive identification. It is also quite
interesting x x x that when the accused x x x testified in
open court x x x, he only advanced the defense of flat
denial. He never mentioned x x x that when the alleged
rape incidents happened on November 21, 1998 x x x he
was at Brgy. Ilayang Ilog-B, Lopez, Quezon helping
Florentina Escleto and her son in making copra. It was
only when Florentina Escleto testified x x x that the
evidence of alibi cropped up. No other witnesses were
presented by the defense to bolster the alibi. Even the
son of Florentina Escleto who she claimed was with her
and accused x x x in making copra at Brgy. Ilayang Ilog-B,
Lopez, Quezon on November 21, 1998 was not
presented to shore up the defense of alibi. Thus, it is not
hard for this Court to discern that the accuseds defenses
of denial and alibi were mere concoction, undeserving of
any evidentiary weight and value.
It is also [worth noting] that the accused x x x tried to
impute ill-motive on the part of the victim x x x and her
parents for filing the instant cases against him. He
claimed that the parents of the victim particularly the
victims father was mad at him because when they were
still young, they had a fight wherein he hacked the
former. However, the said allegation of the accused was
not fully substantiated by any other evidence that would
clearly show the alleged ill-motive on the part of the
complainant and her parents. Further, to the mind of this
Court, it is inconceivable that the victim x x x and her
parents would concoct a story of rape over such alleged
quarrel between the victims father and the accused and
thus subject Maria to public humiliation and shame. x x
x.[5]
xxxx
Again, it is worth repeating that this Court found the
testimony of private complainant x x x to be clear,
straightforward and convincing thus, worthy of
credence. She categorically testified that accused x x x
through force and intimidation ha[d] carnal knowledge
of her against her will on two separate occasions that
occurred in the morning and in the evening of November
21, 1998 x x x.[6]
The trial court noted that although the prosecution
satisfactorily established that appellant was a relative of
the victim by consanguinity within the 3rd civil degree, it
however failed to prove the victims minority. It held that
while the victim testified that she was only 12 years old
when the rape incidents transpired, the same could not
be deemed conclusive and binding upon the court
because no other evidence such as a birth certificate was
presented to corroborate or substantiate the victims
minority.[7]
The dispositive portion of the Decision of the trial court
reads:
WHEREFORE, in view of all the foregoing considerations,
this Court hereby finds accused Reynaldo Albalate, Jr.
GUILTY beyond reasonable doubt of the crime of RAPE
both in Criminal Case No. 3169-C and Criminal Case No.
3170-C and hereby sentences said accused to suffer the
penalty of RECLUSION PERPETUA in both cases and to
pay the private offended party Maria the amount of
FIFTY THOUSAND PESOS (P50,000.00) as civil indemnity
plus the amount of FIFTY THOUSAND PESOS
(P50,000.00) as moral damages in each case.
The accused is to be credited [for] his preventive
imprisonment if proper and any pursuant to the
provision of Article 29 of the Revised Penal Code as
amended by R.A. 6127 and E.O. 214.
SO ORDERED.[8]
Ruling of the Court of Appeals
On appeal, appellant mainly argued that the prosecution
failed to prove his guilt beyond reasonable doubt and
thus the trial court erred in finding him guilty of two
counts of rape.Appellant claimed that he could not have
raped the victim because the examining physician
testified that Maria did not suffer any hymenal
lacerations. Appellant also alleged that the trial court
failed to consider the fact that the victim had ill-motives
to testify against him considering that the victims father
had a previous quarrel with the appellant. The defense
also argued that the veracity of the victims testimony
was weakened by the prosecutions failure to present the
testimony of Ruel, the victims cousin, to corroborate the
testimony of the victim.
The Court of Appeals, however, did not find merit in
appellants contentions. Thus, in its Decision[9] dated May
3, 2006, the Court of Appeals affirmed in toto[10] the
Decision of the trial court.
The appellate court did not dignify appellants defenses
of denial and alibi in view of the fact that he was
positively identified by the victim as the perpetrator of
the crime. Appellants imputation of ill-motives was also
disregarded. The Court of Appeals opined that no
member of the victims family would subject the victim to
the stigma and embarrassment concomitant with a rape
trial, if he or she is not motivated by an honest desire to
have the malefactor punished. Anent the findings of the
examining physician that the victim suffered no hymenal
lacerations, the Court of Appeals opined that the same
did not mean that the victim was not raped. It held that a
medical examination is not indispensable in rape
cases. The perpetrator of the crime may be found guilty
based solely on the testimony of the victim if the same is
found to be credible. Finally, the Court of Appeals held
that the veracity of the prosecutions evidence was not
diminished by its failure to present the testimony of Ruel
which would only be corroborative.
As regards the penalties imposed by the trial court, the
Court of Appeals held that:
With respect to the propriety of the penalty imposed,
the Court agrees with the finding of the RTC that there is
no concurrence of the aggravating circumstances of the
victims minority and her relationship to the accused-
appellant which would warrant the imposition of the
death penalty. Hence, accused-appellant was properly
meted the penalty of reclusion perpetua in Criminal Case
No. 3169-C. On the other hand, the Court noted that the
rape under Criminal Case No. 3170-C was committed
with the use of an ice pick, which is a deadly
weapon. Article 335 of the Revised Penal Code provides
that whenever the rape is committed with the use of a
deadly weapon x x x, the penalty shall be reclusion
perpetua to death. In relation thereto, Article 63 of the
same Code prescribes that when a penalty is composed
of two (2) indivisible penalties, and there are neither
mitigating nor aggravating circumstances in the
commission of the deed, as in this case, the lesser
penalty shall be applied. Accordingly, no reversible error
was likewise committed by the RTC in imposing the
penalty of reclusion perpetua against accused-appellant
in the latter case.[11]
On November 20, 2006, we required the parties to
submit their respective supplemental briefs[12] but both
manifested that they are adopting the allegations and
arguments in their respective appellants/appellees briefs
and would thus no longer submit their supplemental
briefs.[13]
Our Ruling
We AFFIRM with MODIFICATION the Decision of the
Court of Appeals.
Guided by the principles that: a) an accusation for rape is
easy to make, difficult to prove and even more difficult
to disprove; b) in view of the intrinsic nature of the
crime, the testimony of the complainant must be
scrutinized with utmost caution and c) the evidence of
the prosecution must stand on its own merits and
cannot draw strength from the weakness of the
evidence for the defense,[14] we hold that both the trial
court and the Court of Appeals correctly found appellant
guilty of two counts of rape committed on November
21, 1998.
Findings of the trial court on the credibility of witnesses
and their testimonies are accorded great weight and
respect.
The trial court found the testimony of Maria to be clear,
straightforward and credible. Thus:
This Court painstakingly scrutinized with great caution
the testimony of private complainant Maria in the cases
at bar and found the same to be clear, straightforward,
credible and convincing.[15] x x x.
xxxx
Again, it is worth repeating that this Court found the
testimony of private complainant Maria to be clear,
straightforward and convincing thus, worthy of
credence. She categorically testified that accused
Reynaldo Albalate, Jr. through force and intimidation
ha[d] carnal knowledge of her against her will on two
separate incidents that occurred in the morning and in
the evening of November 21, 1998 x x x.[16]
On appeal, said finding was affirmed by the Court of
Appeals.
We find no reason to deviate from the said findings. In
rape cases, the evaluation of the credibility of witnesses
is addressed to the sound discretion of the trial judge
whose conclusion thereon deserves much weight and
respect, because the judge has the direct opportunity to
observe them on the stand and ascertain whether they
are telling the truth or not.[17] We have long adhered to
the rule that findings of the trial court on the credibility
of witnesses and their testimonies are accorded great
respect unless it overlooked substantial facts and
circumstances, which if considered, would materially
affect the result of the case.[18]
Jurisprudence is replete with rulings that an appellant
could justifiably be convicted based solely on the
credible testimony of the victim. Besides, there is
nothing in the records which would indicate that the trial
court and the Court of Appeals overlooked or failed to
appreciate some facts which if considered would change
the outcome of the case.
The prosecution failed to satisfactorily establish the
minority of the victim.
The Informations alleged that Maria was a 12-year old
minor when she was ravished by her uncle, a relative by
consanguinity within the 3rd civil degree. The
prosecutions evidence as to the age of the victim
constituted merely of the victims testimony. We find this
bare testimony insufficient proof of her age. As we held
in People v. Manalili,[19] the minority of the victim and
her relationship to the offender must be alleged in the
criminal complaint or information and proved
conclusively and indubitably as the crime itself. We also
ruled in People v. Tabanggay[20] that -
x x x there must be independent evidence proving the
age of the victim, other than the testimonies of
prosecution witnesses and the absence of denial by the
accused. x x x
As such, both the trial court and the Court of Appeals
correctly held that the minority of the victim was
not satisfactorily established. Corollarily, we held in
People v. Lopit[21] that:
In the prosecution of criminal cases, especially those
involving the extreme penalty of death, nothing but
proof beyond reasonable doubt of every fact necessary
to constitute the crime with which an accused is charged
must be established. Qualifying circumstances or special
qualifying circumstances must be proved with equal
certainty and clearness as the crime itself; otherwise,
there can be no conviction of the crime in its qualified
form. As a qualifying circumstance of the crime of rape,
the concurrence of the victims minority and her
relationship to the accused-appellant must be both
alleged and proven beyond reasonable doubt.[22]
We also reiterate the guidelines set forth in People v.
Pruna[23] in appreciating the age, either as an element of
the crime or as a qualifying circumstance, viz:
1. The best evidence to prove the age of the
offended party is an original or certified true copy of the
certificate of live birth of such party.
2. In the absence of a certificate of live birth,
similar authentic documents such as baptismal
certificate and school records which show the date of
birth of the victim would suffice to prove age.
3. If the certificate of live birth or authentic
document is shown to have been lost or destroyed or
otherwise unavailable, the testimony, if clear and
credible, of the victims mother or a member of the
family either by affinity or consanguinity who is qualified
to testify on matters respecting pedigree such as the
exact age or date of birth of the offended party pursuant
to Section 40, Rule 130 of the Rules on Evidence shall be
sufficient under the following circumstances:
a. If the victim is alleged to be below 3 years of
age and what is sought to be proved is that she is less
than 7 years old;
b. If the victim is alleged to be below 7 years of
age and what is sought to be proved is that she is less
than 12 years old;
c. If the victim is alleged to be below 12 years of
age and what is sought to be proved is that she is less
than 18 years old.
4. In the absence of a certificate of live birth,
authentic document or the testimony of the victims
mother or relatives concerning the victims age, the
complainants testimony will suffice provided that it is
expressly and clearly admitted by the accused.
5. It is the prosecution that has the burden of
proving the age of the offended party. The failure of the
accused to object to the testimonial evidence regarding
age shall not be taken against him.
6. The trial court should always make a categorical
finding as to the age of the victim.
Appellants denial and alibi deserve no consideration at
all.
When appellant took the witness stand, he denied that
he raped the victim. However, other than his self-serving
testimony, he offered no evidence to support his
denial. We have held that, denial, if unsubstantiated by
clear and convincing evidence, is a negative and self-
serving evidence, which deserves no weight in law and
cannot be given greater evidentiary value over the
testimonies of credible witnesses who testify on
affirmative matters.[24] In this case, appellants denial
crumbles under the weight of Marias positive
identification of appellant as her lecherous attacker.
Likewise, we afford no evidentiary value to appellants
claim that the filing of the rape charges was orchestrated
by the victims parents, particularly her father who
allegedly harbored ill-feelings towards appellant. Other
than the fact that this claim was unsubstantiated, we
find appellants claim too general to be believed. He
merely claimed that he fought with the victims father
when they were both still young. But he failed to provide
any detail as to when this alleged incident happened.
The alibi proffered by the appellant must be
rejected. Both the trial court and the Court of Appeals
correctly noted that appellant failed to make any
mention about this alleged alibi when he was placed on
the witness stand. It was only when defense witness
Florentina Escleto (Escleto) testified that this alibi
cropped up. At any rate, the same deserves no
consideration at all. Escleto claimed to be a friend of the
appellant. It is settled jurisprudence that an alibi
becomes less plausible when it is corroborated by
relatives and friends who may not be impartial
witnesses.[25]Much less in the instant case considering
that appellant himself did not proffer any alibi; it was
only Escleto who thought of offering this defense of
alibi. Besides, the defense failed to establish that it was
physically impossible for the appellant to be at the crime
scene at the time the rape incidents were committed.
Propriety of the penalties imposed. x x x x.

Due to the failure of the prosecution to prove the

The rape incidents were committed on November 21,
1998 and thus are governed by Articles 266-A and 266-B
of the Revised Penal Code, as amended by Republic Act
No. 8353 which took effect on October 22, 1997. Articles
266-A and 266-B of the Revised Penal Code read thus:
ART. 266-A. Rape, When and How Committed. Rape is
committed
1. By a man who shall have carnal knowledge of a
woman under any of the following circumstances:
a) Through force, threat or intimidation;
b) When the offended party is deprived of reason
or is otherwise unconscious;
c) By means of fraudulent machinations or grave
abuse of authority;
d) When the offended party is under twelve (12)
years of age or is demented, even though none of the
circumstances mentioned should be present;
qualifying circumstance of minority, appellant could only
be held liable for simple rape on two counts. Thus, the
trial court and the Court of Appeals correctly sentenced
appellant to reclusion perpetua and to pay the amounts
of P50,000.00 as civil indemnity and P50,000.00 as moral
damages for each count of rape.[26] In addition, the
award of exemplary damages in the amount
of P30,000.00[27] is proper considering the presence of
the aggravating circumstance of relationship.[28]
WHEREFORE, the Decision of the Court of Appeals dated
May 3, 2006 in CA-G.R. CR No. 00213 finding appellant
Reynaldo Albalate, Jr. guilty beyond reasonable doubt of
two counts of rape and sentencing him to suffer the
penalty of reclusion perpetua and to pay Maria the
amounts P50,000.00 as civil indemnity and P50,000.00
as moral damages, for each count, is AFFIRMED with
the MODIFICATION that appellant is further ordered to
pay the amount of P30,000.00 as exemplary damages,
for each count of rape.
SO ORDERED.

xxxx

ART. 266-B. Penalties. Rape under paragraph 1 of the

next preceding article shall be punished by reclusion
perpetua.

Whenever the rape is committed with the use of a

deadly weapon or by two or more persons, the penalty
shall be reclusion perpetua to death.

xxxx

The death penalty shall also be imposed if the crime of

rape is committed with any of the following
aggravating/qualifying circumstances:

1. When the victim is under eighteen (18) years of age

and the offender is a parent, ascendant, step-parent,
guardian, relative by consanguinity or affinity within the
third civil degree, or the common law spouse of the
parent of the victim.
ARSENIO S. G.R. No. 171023 Employee Discipline and has exhibited poor
QUIAMBAO, performance in the latter part of his employment. Thus:
Petitioner,
Present: EMPLOYEES PROFILE

CARPIO,* J., Chairperson, A. INFRACTIONS -

- versus - LEONARDO-DE CASTRO,**
BRION, DATE
DEL CASTILLO, and Nature FROM TO ACTION
ABAD, JJ. TAKEN
MANILA ELECTRIC 1. Excessive 11/11/9 11/24/9 10-day
COMPANY, Promulgated: absences 9 9 suspensio
Respondent. December 18, 2009 n
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - 2. Excessive 10/19/9 10/25/9 5-day
-----------------x absences 9 9 suspensio
n
DECISION 3. Excessive 07/27/9 07/29/9 3-day
absences 9 9 suspensio
DEL CASTILLO, J.: n
The liberality of the law can never be extended to the 4. Assaultin 02/17/9 02/17/9 Reprimand
unworthy and undeserving. In several instances, the g others 9 9
policy of social justice has compelled this Court to accord with
financial assistance in the form of separation pay to a bodily harm
legally terminated employee. This liberality, however, is over work
not without limitations. Thus, when the manner and matters
circumstances by which the employee committed the 5. Excessive 02/08/9 02/08/9 Reprimand
act constituting the ground for his dismissal show his tardiness 9 9
perversity or depravity, no sympathy or mercy of the law
6. Excessive 10/06/9 10/06/9 Reprimand
can be invoked.
tardiness 7 7
7. Simple 03/11/9 03/11/9 Reprimand
This petition for review on certiorari[1] assails the
Absence 7 7
Decision[2] dated October 28, 2005 and
[3]
Resolution dated January 12, 2006 of the Court of 8. Excessive 06/14/9 06/14/9 Reprimand
Appeals (CA) in CA-G.R. SP No. 85332, which reversed tardiness 6 6
the February 4, 2004 Decision[4] of the National Labor 9. Excessive 09/03/9 09/03/9 Reprimand
Relations Commission (NLRC) awarding petitioner tardiness 2 2
Arsenio S. Quiambao separation pay in the amount
of P126,875.00. B. PERFORMANCE RATING

Factual Antecedents His merit ratings from 1995 to 1999 are as follows:

On July 16, 1986, petitioner was employed as branch YEAR RATING

teller by respondent Manila Electric Company. He was 1999 Poor
assigned at respondents Mandaluyong office and was 1998 Needs Improvement
responsible for the handling and processing of payments 1997 Needs Improvement
made by respondents customers. 1996 Satisfactory
1995 Satisfactory[5]
It appears from his employment records, however, that
petitioner has repeatedly violated the Company Code of
On March 10, 2000, a Notice of Investigation[6] was
served upon petitioner for his unauthorized and
unexcused absences on November 10, 25, 26, 29, 1999;
December 1, 2, 14, 15, 16, 17, 20, 21, 22, 2000; and from
February 17, 2000 up to the date of such notification
letter. Petitioner was likewise required to appear at the
investigation and to present his evidence in support of
his defense. However, despite receipt of such notice,
petitioner did not participate in the
investigation. Consequently, in a SO ORDERED.[11]
[7]
Memorandum dated March 21, 2000, the legal
department recommended petitioners dismissal from
employment due to excessive, unauthorized, and
unexcused absences, which constitute (i) abandonment
of work under the provisions of the Company Code of
Employee Discipline (ii) and gross and habitual neglect of
duty under Article 282 of the Labor Code of
the Philippines. Through a Notice of
Dismissal[8] dated March 28, 2000, petitioners
employment was terminated effective March 29, 2000.
Proceedings before the Labor Arbiter
On July 3, 2001, petitioner filed a complaint before the
Arbitration Branch of the NLRC against respondent
assailing the legality of his dismissal. While petitioner did
not dispute his absences, he nonetheless averred that
the same were incurred with the corresponding
approved application for leave of absence. He also
claimed that he was denied due process.
On November 29, 2002, the Labor Arbiter rendered a
Decision[9] dismissing petitioners complaint for lack of
merit. The Labor Arbiter ruled that no evidence was
presented to prove that the absences of petitioner were
authorized; that petitioner was deprived of due process;
and that petitioners habitual absenteeism without leave
did not violate the companys rules and regulations which
justified his termination on the ground of gross and
habitual neglect of duties under Article 282(b) of the
Labor Code.
Proceedings before the NLRC
Petitioner appealed to the NLRC which affirmed the
legality of his dismissal due to habitual
absenteeism. Nonetheless, the NLRC awarded
separation pay in favor of petitioner citing the case
of Philippine Geothermal, Inc. v. National Labor Relations
Commission.[10] The dispositive portion of the NLRC
Decision reads:
WHEREFORE, the decision appealed from is hereby
MODIFIED to the extent that the respondent is hereby
ordered to pay the complainant separation pay
amounting to P126,875.00 (P18,125.00 x 14 yrs./2
= P126,875.00).
Respondent filed a Motion for
Reconsideration[12] impugning the
grant of separation pay, which motion was denied by the
NLRC in a
Resolution[13] dated May 20, 2004.
Proceedings before the Court of Appeals
Aggrieved, respondent filed with the CA a petition
for certiorari. On October 28, 2005, the CA nullified the
NLRCs Decision and reinstated the Labor Arbiters
Decision dismissing the complaint. It ruled that the
award of separation pay is neither justified nor
warranted under the circumstances. Thus:
We find, then, that the award of separation pay was
capricious, whimsical, and unwarranted, both for the
award being without factual and legal basis and for
ignoring that the valid cause of dismissal was serious
misconduct on the part of the employee.
Respondent Quiambao was dismissed for excessive
unauthorized absences. His dismissal was, in fact, upheld
by both the Labor Arbiter and the NLRC. We should
agree with their determination.
But we should hold here further that Quiambao
committed a serious misconduct that merited no
consideration or compassion. He was guilty not of mere
absenteeism only, for such absences, unexcused and
habitual, reflected worse than inefficiency, but a gross
and habitual neglect of duty bordering on dishonesty. He
had no compelling reason to be absent from work,
substantially prejudicing his employer, which was a
public utility whose distribution of electricity to its
customers within its franchise area was a service that
was very vital and of utmost necessity to the lives of all
its customers. The responsibility required of the
petitioners employees was, in fact, publicly imposed by
the petitioner in its Company Code On Employee
Discipline, aforequoted, whereby it gave primacy to the
maintenance of discipline as a matter of fundamental
importance.[14]
Petitioner moved for a reconsideration, but to no avail.
Issue
Hence, this petition for review on certiorari raising the
sole issue of whether or not a validly dismissed
employee may be entitled to separation pay.
Petitioners Arguments
Petitioner contends that the CA grievously erred in
concluding that he is guilty of serious misconduct and in
deleting the award of separation pay. He argues that the
NLRC, whose findings are entitled to great respect and
finality, regarded his unauthorized absences as gross and
habitual neglect of duty only. Citing Philippine
Geothermal, Inc. v. National Labor Relations
Commission,[15] where an employee who was
terminated on similar ground of gross and habitual
neglect of duties because of continued and unexplained
absences, and who was nonetheless granted separation
pay, petitioner claims that the same accommodation
should likewise be extended to him. He insists that his
absences do not amount to serious misconduct
considering that his infractions did not reflect on his
moral character. It did not create imminent or
substantial injury to the companys operation and the
consuming public, and were not committed for self-
interest or unlawful purpose but on account of domestic
and marital problems. Taking into account all these and
his 14 years of service in the company, petitioner invokes
the principles of social justice and equity in justifying his
entitlement to separation pay.
Our Ruling
The petition lacks merit.
The Labor Arbiter, the NLRC and the Court of Appeals
found petitioner guilty of gross and habitual neglect of
duty.
The Labor Arbiter and the NLRC are one in holding that
petitioners unauthorized absences and repeated
infractions of company rules on employee discipline
manifest gross and habitual neglect of duty that merited
the imposition of the supreme penalty of dismissal from
work. The only difference in their ruling is that the NLRC
awarded separation pay. The CA, after reviewing the
records of the case, affirmed the findings of the labor
tribunals. And, on the basis of these findings, further
concluded that petitioners infractions are worse than
inefficiency; they border on dishonesty constituting
serious misconduct.
We have examined the records which indeed show that
petitioners unauthorized absences as well as tardiness
are habitual despite having been penalized for past
infractions. In Gustilo v. Wyeth Philippines, Inc.,[16] we
held that a series of irregularities when put together may
constitute serious misconduct. We also held that gross
neglect of duty becomes serious in character due to
frequency of instances.[17] Serious misconduct is said to
be a transgression of some established and definite rule
of action, a forbidden act, a dereliction of duty, willful in
character, and indicative of wrongful intent and not
mere error of judgment.[18] Oddly, petitioner never
advanced any valid reason to justify his
absences. Petitioners intentional and willful violation of
company rules shows his utter disregard of his work and
his employers interest. Indeed, there can be no good
faith in intentionally and habitually incurring unexcusable
absences. Thus, the CA did not commit grave abuse of
discretion amounting to lack or excess of jurisdiction in
equating petitioners gross neglect of duty to serious
misconduct.
Petitioner is not entitled to separation pay.
Besides, even assuming that the ground for petitioners
dismissal is
gross and habitual neglect of duty, still, he is not entitled
to severance pay. In Central Philippines Bandag
Retreaders, Inc. v. Diasnes,[19] we discussed the
parameters of awarding separation pay to dismissed
employees as a measure of financial assistance, viz:
To reiterate our ruling in Toyota, labor adjudicatory
officials and the CA must demur the award of separation
pay based on social justice when an employees dismissal
is based on serious misconduct or willful fine, we should be more cautious in awarding financial
disobedience; gross and habitual neglect of duty; fraud assistance to the undeserving and those who are
or willful breach of trust; or commission of a crime unworthy of the liberality of the law.[20] (Emphasis
against the person of the employer or his immediate supplied.)
family - grounds under Art. 282 of the Labor Code that WHEREFORE, the petition is DENIED for lack of
sanction dismissals of employees. They must be most merit. The assailed October 28, 2005 Decision
judicious and circumspect in awarding separation pay or and January 12, 2006 Resolution of the Court of Appeals
financial assistance as the constitutional policy to provide in CA-G.R. SP No. 85332 are AFFIRMED.
full protection to labor is not meant to be an instrument
to oppress the employers. The commitment of the Court SO ORDERED.
to the cause of labor should not embarrass us from
sustaining the employers when they are right, as here. In
EFREN M. HERRERA and ESTHER C.
GALVEZ, for and on their behalf and
on behalf of OTHER SEPARATED,
UNREHIRED and RETIRED
EMPLOYEES OF THE NATIONAL
POWER CORPORATION,
Petitioners,
- versus -
NATIONAL POWER CORPORATION,
THE DEPARTMENT OF BUDGET
AND MANAGEMENT and THE
OFFICE OF THE SOLICITOR
GENERAL,
Respondents.
x------------------------------------------x
DECISION
DEL CASTILLO, J.:
The question at the heart of this case is whether
petitioners, former employees of the National Power
Corporation (NPC) who were separated from service due
to the governments initiative of restructuring the electric
power industry, are entitled to their retirement benefits
in addition to the separation pay granted by law.
Absent explicit statutory authority, we cannot provide
our imprimatur to the grant of separation pay and
retirement benefits from one single act of involuntary
separation from the service, lest there be duplication of
purpose and depletion of government resources. Within
the context of government reorganization, separation
pay and retirement benefits arising from the same
cause, are in consideration of the same services and
granted for the same purpose. Whether denominated as
separation pay or retirement benefits, these financial
benefits reward government service and provide
monetary assistance to employees involuntarily
separated due to bona fide reorganization.
This is a Petition for Review on Certiorari under Rule 45
of the Rules of Court on a pure question of law against
the Decision[1] dated December 23, 2004 rendered by
the Regional Trial Court (RTC), Branch 101, Quezon City
in SCA No. Q-03-50681 (for Declaratory Relief)
entitled National Power Corporation v. Napocor
Employees and Workers Union (NEWU), NAPOCOR
G.R. No. 166570
Present:
CARPIO,* J., Chairperson,
LEONARDO-DE CASTRO,**
BRION,
DEL CASTILLO, and
ABAD, JJ.
Promulgated
December 18, 2009
Employees Consolidated Union (NECU), NPC Executive
Officers Association, Inc. (NPC-EXA), Esther Galvez and
Efren Herrera, for and on their behalf and in behalf of
other separated, unrehired, and retired employees of the
National Power Corporation, the Department of Budget
and Management (DBM), the Office of the Solicitor
General (OSG), the Civil Service Commission (CSC) and the
Commission on Audit (COA). Said Decision ruled that the
petitioners are not entitled to receive retirement
benefits under Commonwealth Act No. 186 (CA No.
186),[2] as amended, over and above the separation
benefits they received under Republic Act (RA) No.
9136,[3] otherwise known as the Electric Power Industry
Reform Act of 2001 (EPIRA).
Legal and factual background
RA No. 9136 was enacted on June 8, 2001 to provide a
framework for the restructuring of the electric power
industry, including the privatization of NPCs assets and
liabilities.[4] One necessary consequence of the
reorganization was the displacement of employees from
the Department of Energy, the Energy Regulatory Board,
the National Electrification Administration and the
NPC. To soften the blow from the severance of
employment, Congress provided in Section 63 of the
EPIRA, for a separation package superior than those
provided under existing laws, as follows:
SEC. 63. Separation Benefits of Officials and Employees of
Affected Agencies. National government employees
displaced or separated from the service as a result of the
restructuring of the [electric power] industry and
privatization of NPC assets pursuant to this Act, shall be
entitled to either a separation pay and other benefits in
accordance with existing laws, rules or regulations or
be entitled to avail of the privileges provided under a
separation plan which shall be one and one-half month
salary for every year of service in the government:
Provided, however, That those who avail of such
privilege shall start their government service anew if
absorbed by any government-owned successor
company. In no case shall there be any diminution of
benefits under the separation plan until the full
implementation of the restructuring and privatization. x
x x (Emphasis supplied)
The implementing rules of the EPIRA, approved by the
Joint Congressional Power Commission on February 27,
2002,[5] further expounded on the separation
benefits, viz:
RULE 33. Separation Benefits
Section 1. General Statement on Coverage.
This Rule shall apply to all employees in the National
Government service as of June 26, 2001 regardless of
position, designation or status, who are displaced or
separated from the service as a result of the
restructuring of the electric [power] industry and
privatization of NPC assets: Provided, however, That the
coverage for casual or contractual employees shall be
limited to those whose appointments were approved or
attested [to] by the Civil Service Commission (CSC).
Section 2. Scope of Application.
This Rule shall apply to affected personnel of DOE, ERB,
NEA and NPC.
Section 3. Separation and Other Benefits.
(a) The separation benefit shall consist of either a
separation pay and other benefits granted in
accordance with existing laws, rules and regulations or
a separation plan equivalent to one and one half (1-1⁄2)
months salary for every year of service in the
government, whichever is higher; Provided, That the
separated or displaced employee has rendered at least
one (1) year of service at the time of effectivity of the
Act.
xxxx
(e) For this purpose, Salary, as a rule, refers to the basic
pay including the thirteenth (13th) month pay received
by an employee pursuant to his appointment, excluding
per diems, bonuses, overtime pay, honoraria, allowances
and any other emoluments received in addition to the
basic pay under existing laws.
(f) Likewise, Separation or Displacement refers to the
severance of employment of any official or employee,
who is neither qualified under existing laws, rules and
regulations nor has opted to retire under existing
laws, as a result of the Restructuring of the electric
power industry or Privatization of NPC assets pursuant to
the Act. (Emphasis supplied)
On February 28, 2003, all NPC employees, including the
petitioners, were separated from the service. As a result,
all the employees who held permanent positions at the
NPC as of June 26, 2001 opted for and were paid the
corresponding separation pay equivalent to one and a
half months salary per year of service. Nonetheless, in
addition to the separation package mandated by the
EPIRA, a number of NPC employees also claimed
retirement benefits under CA No. 186,[6] as amended by
RA No. 660[7] and RA No. 1616.[8] Under these laws,
government employees who have rendered at least 20
years of service are entitled to a gratuity equivalent to
one months salary for every year of service for the first
20 years, one and a half months salary for every year of
service over 20 but below 30 years, and two months
salary for every year of service in excess of 30 years.[9]
The NPC, on the other hand, took the position that the
grant of retirement benefits to displaced employees in
addition to separation pay was inconsistent with the
constitutional proscription on the grant of a double
gratuity. Unable to amicably resolve this matter with its
former employees, the NPC filed on September 18,
2003, a Petition for Declaratory Relief[10] against several
parties,[11] including the petitioners, before the RTC of
Quezon City, to obtain confirmation that RA No. 9136
did not specifically authorize NPC to grant retirement
benefits in addition to separation pay.[12] The case was
docketed as SCA No. Q-03-50681 and raffled to Branch
101 of said court.
After submission of the respondents respective Answers
and Comments,[13] the parties agreed that the court a
quo would resolve the case based on the arguments
raised in their memoranda[14] since only a question of
law was involved.[15] In due course, the court a
quo rendered the assailed Decision, finding that
employees who received the separation benefit under
RA No. 9136 are no longer entitled to retirement
benefits:

The aforementioned law speaks of two (2) options for
the employee to choose from, that is: (1) to receive
separation pay and other benefits in accordance with
existing laws, rules, and regulations or (2) to avail of the
privileges provided under a separation plan (under R.A.
9136), which shall be one and one half months salary for
every year of service in the government.
Under Section 3(f) of Rule 33 of the Implementing Rules
and Regulations of R.A. 9136, separation or
displacement refers to the severance of employment of
any official or employee, who is neither qualified under
existing laws, rules, and regulations nor has opted to
retire under existing laws as a result of the Restructuring
of the electric power industry or Privatization of NPC
assets pursuant to the act. Thus, it is clear that the
receipt of benefits under the EPIRA law, by employees
who opted to retire under such law bars the receipt of
retirement benefits under R.A. 1616.
Moreover, Section 8 of Article IX-B of the 1987
Constitution prohibits the grant of both separation pay
and retirement benefits. x x x
xxxx
In said constitutional provision, it is x x x clear that
additional or indirect compensation is barred by law and
only [allowed] when so specifically authorized by law.
Furthermore, on the Private Respondents' contention
that the second paragraph should be applied in their
[case], the same will not hold water. This is so because
retirement benefits [are] not synonymous to pension or
gratuities as contemplated by law.
R.A. 9136 did not clearly and unequivocally authorize the
payment of additional benefits to Private Respondents
as the benefits referred to in such law should not be
interpreted to include retirement benefits in addition to
their separation pay. Separation from service due to
[the] restructuring of the [electric] power industry should
not be interpreted to mean retirement as both are
different in every respect. The law specifically defines the
meaning of separation by virtue of the restructuring. x x
x package under the EPIRA.
xxxx
Thus, the Respondent-Employees are not entitled to
receive retirement benefits under Republic Act No. 1616
over and above the separation benefits they received
under Republic Act No. 9136.[16]
Petitioners sought recourse from the assailed Decision
directly before this court on a pure question of law. The
Department of Budget and Management (DBM)
submitted its Comment on June 30, 2005,[17] while the
NPC, through the Office of the Solicitor General, filed its
Comment on August 23, 2005.[18] Petitioners then filed
their Consolidated Reply by registered mail on
November 18,
[19]
2005. After the parties filed their respective memoran
da,[20] the case was
submitted for decision.
Petitioners arguments
Before us, petitioners argue that:
1) The EPIRA does not bar the application of CA No. 186,
as amended. Petitioners are therefore entitled to their
retirement pay in addition to separation pay.
2) Petitioners have vested rights over their retirement
benefits.
3) The payment of both retirement pay and separation
pay does not constitute double compensation, as the
Constitution provides that pensions or gratuities shall
not be considered as additional, double or indirect
compensation.
Respondents arguments
Respondents NPC and the DBM, on the other hand,
maintain that:
1) Section 63 of RA No. 9136 and Section 3, Rule 33 of its
Implementing Rules and Regulations do not authorize
the grant of retirement benefits in addition to the
separation pay already received. Rather, Section 63
requires separated employees to choose between a
separation plan under existing laws or the separation
2) The grant of both separation pay and retirement
benefit amounts to double gratuity in direct
contravention of the Constitution.
3) No law authorizes the payment of both separation pay
and retirement benefits to petitioners.
Issue
The sole issue in this case is whether or not NPC
employees who were separated from the service
because of the reorganization of the electric power
industry and who received their separation pay under RA
No. 9136 are still entitled to receive retirement benefits
under CA No. 186, as amended.
Our Ruling
We deny the petition and affirm the court a
quos Decision dated December 23, 2004 in SCA No. Q-
03-50681.
Absent clear and unequivocal statutory authority, the
grant of both separation pay and retirement benefits
violates the constitutional proscription on additional
compensation.
Section 8 of Article IX(B) of the Constitution provides that
[n]o elective or appointive public officer or employee
shall receive additional, double, or indirect
compensation, unless specifically authorized by law. In
prior decisions, we have ruled that there must be a clear
and unequivocal statutory provision to justify the grant
of both separation pay and retirement benefits to an
employee.[21] Here, absent an express provision of law,
the grant of both separation and retirement benefits
would amount to double compensation from one single
act of separation from employment.
Petitioners claim that Section 9 of RA No.
6656[22] amounts to sufficient statutory basis for the
grant of both retirement benefits and separation
pay. Section 9 provides:
x x x Unless also separated for cause, all officers and
employees, who have been separated pursuant to
reorganization shall, if entitled thereto, be paid
the appropriate separation pay and retirement and
other benefits under existing laws within ninety (90)
days from the date of the effectivity of their separation
or from the date of the receipt of the resolution of their
appeals as the case may be. Provided, That application
for clearance has been filed and no action thereon has
been made by the corresponding department or agency.
Those who are not entitled to said benefits shall be paid
a separation gratuity in the amount equivalent to one (1)
month salary for every year of service. Such separation
pay and retirement benefits shall have priority of
payment out of the savings of the department or agency
concerned.(Emphasis supplied)
Unfortunately for the petitioners, their interpretation
has little legal precedent. The CSC has previously ruled
that employees similarly situated to petitioners herein
were not entitled to both separation pay and retirement
benefits; instead, the concerned employee must either
avail of the separation benefit or opt to retire if qualified
under existing laws. In CSC Resolution No. 021112,[23] the
CSC interpreted the phrase separation pay and
retirement in RA No. 6656 as follows:
x x x While the aforequoted provision of law used the
conjunctive "and" between the words "separation
pay" and "retirement", this does not mean that both
benefits shall be given to an affected employee. This
interpretation is supported by the phrase "if entitled
thereto" found before the phrase "be paid the
appropriate separation pay and retirement and other
benefits under existing laws". Thus, payment of both
separation and retirement benefits is not absolute.
Also, in CSC Resolution No. 00-1957,[24] the CSC declared:
The aforequoted provision of law says: separation pay
and retirement and other benefits under existing laws.
Be it noted that the conjunctive and is used between
separation pay and retirement, which in its elementary
sense would mean that they are to be taken jointly.
(Ruperto G. Martin, Statutory Construction, sixth edition,
p. 88) Obviously, therefore, separation pay and
retirement refer to only one benefit, of which an
employee affected by the reorganization, if entitled
thereto, must be paid plus other benefits under existing
laws, i.e. terminal leave pay, etc.
Further, in Cajiuat v. Mathay,[25] we found that in the
absence of express provisions to the contrary, gratuity
laws should be construed against the grant of double
compensation. Cajiuat involved employees of the Rice
and Corn Administration who exercised their option to
retire under CA No. 186 and received the appropriate
retirement benefits. Subsequently, the Rice and Corn
Administration was abolished by Presidential Decree No.
4.[26] Said Decree also provided for the payment of a
gratuity in Section 26, paragraph 3:
Permanent officials and employees of the Rice and Corn
Administration who cannot be absorbed by
the Administration, or who cannot transfer or to be
transferred to other agencies, or who prefer to retire, if
qualified for retirement, or to be laid off, shall be given
gratuity equivalent to one month salary for every year of
service but in no case more than twenty-four months
salary, in addition to all other benefits to which they are
entitled under existing laws and regulations. x x x
On the basis of this provision, the retired employees of
the Rice and Corn Administration claimed that they were
entitled to the separation gratuity, over and above the
retirement benefits already received. We disagreed and
held that:
x x x [t]here must be a provision, clear and unequivocal,
to justify a double pension. The general language
employed in paragraph 3, Section 26 of Presidential
Decree No. 4 fails to meet that test. All that it states is
that permanent employees of the Rice and Corn
Administration who are retirable are entitled to gratuity
equivalent to one month salary for every year of service
but in no case more than twenty four months salary in
addition to other benefits to which they are entitled
under existing laws and regulations. To grant double
gratuity is unwarranted. No reliance can be placed [on]
the use of the term other benefits found in the
paragraph relied upon. As clearly stated in the
memorandum of the Solicitor General, they refer to
those receivable by a retiree under the general
retirement laws, like the refund of contributions to the
retirement fund and the money value of the
accumulated vacation and sick leaves of said official
employee. The clause in addition to all other benefits to
which they are entitled under existing laws and
regulations was inserted to insure the payment to the
retiree of the refund of the contributions to the
retirement fund and the money value of the
accumulated vacation and sick leaves of said official or
employee.[27]
Nothing in the EPIRA justifies the grant of both the
separation package and retirement benefits.
The EPIRA, a legislative enactment dealing specifically
with the privatization of the electric power industry,
provides:
SEC. 63. Separation Benefits of Officials and Employees of
Affected Agencies. National government employees
displaced or separated from the service as a result of the
restructuring of the [electric power] industry and
privatization of NPC assets pursuant to this Act, shall be
entitled to either a separation pay and other benefits in
accordance with existing laws, rules or regulations or
be entitled to avail of the privileges provided under a
separation plan which shall be one and one-half
month[s] salary for every year of service in the
government: Provided, however, That those who avail
of such privilege shall start their government service
anew if absorbed by any government-owned successor
company. In no case shall there be any diminution of
benefits under the separation plan until the full
implementation of the restructuring and privatization. x
x x (Emphasis supplied)
A careful reading of Section 63 of the EPIRA affirms that
said law did not authorize the grant of both separation
pay and retirement benefits. Indeed, the option granted
was either to a separation pay and other benefits in
accordance with existing laws, rules and regulations or to
a separation plan which shall be one and one-half
months salary for every year of service in the
government. The options were alternative, not
cumulative. Having chosen the separation plan, they
cannot now claim additional retirement benefits under
CA No. 186.
This position finds further support in Section 3(f), Rule 33
of RA No. 9136s Implementing Rules and Regulations,
which provides:
(f) likewise, separation or displacement refers to
the severance of employment of any official or
employee, who is neither qualified under existing laws,
rules and regulations nor has opted to retire under
existing laws, as a result of the restructuring of the
electric power industry or privatization of NPC assets
pursuant to the act.
As worded, Rule 33, Section 3(f) of the Implementing
Rules and Regulations of RA No. 9136 precludes the
receipt of both separation and retirement benefits. A
separated or displaced employee, as defined by the
implementing rules, does not include one who is
qualified or has opted to retire under existing
laws. Consequently, a separated employee must choose
between retirement under applicable laws or separation
pay under the EPIRA.
Within the context of reorganization, petitioners cannot
claim a vested right over their retirement benefits.
Petitioners claim that having religiously paid their
premiums, they have vested rights to their retirement
gratuities which may not be revoked or impaired.
However, petitioners fail to consider that under the
retirement laws that they themselves invoke, separation
from the service, whether voluntary or involuntary, is a
distinct compensable event from retirement.[28] Nothing
in said laws permits an employee to claim both
separation pay and retirement benefits in the event of
separation from the service due to reorganization.
Thus, absent an express provision of law to the
contrary, separation due to reorganization gives rise to
two possible scenarios: first, when the separated
employee is not yet entitled to retirement benefits,
second, when the employee is qualified to retire. In the
first case, the employees separation pay shall be
computed based on the period of service rendered in
the government prior to the reorganization. In the
second case, where an employee is qualified to retire, he
or she may opt to claim separation or retirement
benefits.
Contradistinction with Larao v. Commission on Audit
We are, of course, aware that in Larao v. Commission on
Audit[29] we held that employees, who were separated
from the service because of the reorganization of the
Metropolitan Waterworks and Sewerage System
(MWSS) and Local Waterworks and Utilities
Administration (LWUA) pursuant to RA No. 8041, were
entitled to both a separation package and retirement
benefits.[30]
In Larao, however, the Early Retirement Incentive Plan
submitted to and approved by then President Fidel V.
Ramos explicitly provided for a separation package that
would be given over and above the existing retirement
benefits. Therein lies the fundamental difference.
Hence, unlike in this case, there was specific authority for
the grant of both separation pay and retirement
benefits.
WHEREFORE, the petition is DENIED. The Decision
dated December 23, 2004 of the Regional Trial Court of
Quezon City, Branch 101 in SCA No. Q-03-50681 holding
that petitioners are not entitled to receive retirement
benefits under Commonwealth Act No. 186, as amended
is AFFIRMED with MODIFICATION that petitioners are
entitled to a refund of their contributions to the
retirement fund, and the monetary value of any
accumulated vacation and sick leaves.
SO ORDERED.
G.R. No. 160367 December 18, 2009
EVELYN S. CABUNGCAL, ELVIRA J. CANLAS, MARIANITA A. BULANAN, REMEDIOS S. DE JESUS, and
NUNILON J. MABINI, Petitioners,
- versus -
SONIA R. LORENZO, in her capacity as Municipal Mayor of San Isidro, Nueva Ecija, CECILIO DE GUZMAN,
Vice Mayor, CESARIO LOPEZ, JR., EMILIO PACSON, BONIFACIO CACERES, JR., NAPOLEON OCAMPO, MARIO CRUZ,
PRISCILA REYES, ROLANDO ESQUIVEL, and CRISENCIANO CABLAO in their capacity as members of the Sangguniang
Bayan of San Isidro, Nueva Ecija, and EDUARDO N. JOSON IV, Vice Governor, BELLA AURORA A. DULAY, BENJAMIN
V. MORALES, CHRISTOPHER L. VILLAREAL, JOSE T. DEL MUNDO, SOLITA C. SANTOS, RENATO C. TOMAS, JOSE
BERNARDO V. YANGO, IRENEO S. DE LEON, NATHANIEL B. BOTE, RUDY J. DE LEON, RODOLFO M.
LOPEZ, MA. LOURDES C. LAHOM, and JOSE FRANCIS STEVEN M. DIZON, in their capacity as members of the
Sangguniang Panlalawigan of the Province of Nueva Ecija, Respondents.
x------------------------------------ ----x Thereafter, on November 12, 2001, the Sangguniang
Bayan passed Resolution No. 80 s. 2001,[6] approving and
DECISION adopting the proposed new staffing pattern of the
municipal government. On November 26, 2001,
DEL CASTILLO, J.: the Sangguniang Panlalawigan approved the same
through Resolution No. 299 s. 2001.[7]

As a rule, judicial intervention is allowed only after
exhaustion of administrative remedies. This principle
goes hand-in-hand with the doctrine of primary
jurisdiction, which precludes courts from resolving, in the
first instance, controversies falling under the jurisdiction
of administrative agencies. Courts recognize that
administrative agencies are better equipped to settle
factual issues within their specific field of expertise
because of their special skills and technical
knowledge. For this reason, a premature invocation of
the courts judicial power is often struck down, unless it
can be shown that the case falls under any of the
applicable exceptions.
Assailed in this Petition for Review on Certiorari[1] under
Rule 45 of the Rules of Court are the March 20, 2003
Decision[2] of the Court of Appeals (CA) dismissing
petitioners petition for lack of merit and its October 6,
2003 Resolution[3] denying the motion for
reconsideration.
Factual Antecedents
On July 9, 2001, the Sangguniang Bayan of San Isidro,
Nueva Ecija, issued Resolution No. 27 s. 2001[4] declaring
the reorganization of all offices of the municipal
government. On July 23, 2001, the Resolution was
approved by the Sangguniang Panlalawigan
via Resolution No. 154 s. 2001.[5]
On December 21, 2001, the Municipal Mayor of San
Isidro, Nueva Ecija, herein respondent Sonia R. Lorenzo,
issued a memorandum[8] informing all employees of the
municipal government that, pursuant to the
reorganization, all positions were deemed vacant and
that all employees must file their respective applications
for the newly created positions listed in the approved
staffing pattern on or before January 10,
2002. Otherwise, they would not be considered for any
of the newly created positions.
Proceedings before the Court of Appeals
Instead of submitting their respective applications,
petitioners, on January 17, 2002, filed with the CA a
Petition for Prohibition and Mandamus with application
for issuance of Writ of Preliminary Injunction and
Restraining Order.[9] They alleged that they were
permanent employees of the Rural Health Unit of
the Municipality of San Isidro, Nueva Ecija, with the
corresponding salary grade and date of employment:[10]
Salary
Name Position Grade Date of
employment
Evelyn S. Dentist II 16 April 4, 1983
Cabungcal
Elvira J. Nurse III 16 December
Canlas 19, 1978
 Marianita Midwife 11 May 21,
A. III 1981
Bulanan
Remedios Dental 4 June 6, 1989
S. De Aide
Jesus
Nunilon J. Sanitation 6 January 2,
Mabini Inspector 1990
I municipality, which created savings in an estimated
Respondents Sonia R. Lorenzo, Cecilio De Guzman,
Cesario Lopez, Jr., Emilio Pacson, Bonifacio Caceres, Jr.,
Napoleon Ocampo, Mario Cruz, Priscila Reyes, Rolando
Esquivel, and Crisenciano Cablao were sued in their
capacity as Mayor, as Vice Mayor, and as members of
the Sangguniang Bayan respectively, of San Isidro,
Nueva Ecija. On the other hand, respondents Eduardo N.
Joson IV, Bella Aurora A. Dulay, Benjamin V. Morales,
Christopher L. Villareal, Jose T. Del Mundo, Solita C.
Santos, Renato C. Tomas, Jose Bernardo V. Yango, Ireneo
S. De Leon, Nathaniel B. Bote, Rudy J. De Leon, Rodolfo
M. Lopez, Ma. Lourdes C. Lahom, and Jose Francis
Steven M. Dizon were sued in their capacity as Vice
Governor and as members of the Sangguniang
Panlalawigan, respectively.
Petitioners sought to prohibit respondents from
implementing the reorganization of the municipal
government of San Isidro, Nueva Ecija, under Resolution
Nos. 27 and 80 s. 2001 of the Sangguniang Bayan. They
likewise prayed for the nullification of said Resolutions.
While the case was pending, respondent Mayor Sonia R.
Lorenzo issued a letter terminating the services of those
who did not re-apply as well as those who were not
selected for the new positions effective April 21, 2002.[11]
On March 20, 2003, the CA rendered a Decision
dismissing the petition for lack of merit. It ruled:
Going through the arguments of the parties, we find
respondents contentions to be more in line with existing
laws and jurisprudence. It cannot be denied that indeed,
petitioners severance from employment is a sad tale to
tell; however, petitioners allegation of grave abuse of
discretion on the part of public respondents particularly
Mayor Lorenzo, can hardly be justified. The assailed acts
of respondents are clearly authorized under Section 76
of the Local Government Code of 1991 as quoted above.
xxxx
Culled from the records of the case, the reorganization
of the municipal government of San Isidro yielded an
organization structure suitable for a 4th class
amount of more or less Four Million pesos
(P4,000,000.00), which can be used for implementation
of other local projects for delivery of basic services and
additional benefits for its employees. As shown by the
respondents, the original plantilla x x x of one hundred
and thirty one (131) [positions] has been trimmed down
to eighty-eight (88) [positions] under the new staffing
pattern. Thus, We find plausible the [claim] of
respondents about budgetary [savings], comparing the
old with new staffing pattern, in that:
Prior to the reorganization, this LGU had a budget
appropriation of P18,322,933.00 for personal services
[including enterprise workers] leaving a measly sum of
[sic] P4,127,703.00 as revolving fund for the whole
year. With the advent of the new staffing pattern, more
tha[n] P7,000,000.00 can be channeled by this LGU for
its plans and programs. Under Section 325 of the Local
Government Code, LGUs are limited by law to
appropriate only forty five percent [45%] in case of first
to third class LGUs or fifty five percent [55%] in case of
fourth to fifth class municipalities of their annual income
for personal services.The LGU of San Isidro being a fourth
class municipality has certainly exceeded the 55%
appropriation limit under the Local Government Code
because for the year 2000 alone, [P16,787,961.00, or
roughly 78% of its annual income of P22,450,636.00,
have already been allocated to personal services. That
certainly is] way above the ceiling allowed by Section 325
of the Local Government Code.
xxxx
Verily, there was no bad faith on the part of respondents
when they chose to follow the recommendations of the
management committee, [to create] a new staffing
pattern [thereby generating savings] to provide more
basic services [and] livelihood projects x x x.
xxxx

Valid reasons had been shown by respondents which
support the reorganization of the municipal government
of San Isidro. No personal or political motives having
been shown to be involved in this strongly assailed
reorganization of the Municipality of San Isidro,
petitioners, therefore, had miserably failed to show and
prove to this Court that respondents violated R.A. No.
7305 (Magna Carta of Health Workers).
We must point out that good faith is presumed. It is
incumbent upon the petitioners to prove that the
reorganization being implemented in
the Municipality of San Isidro is tainted with bad
faith. Absent any showing that respondents acted with
grave abuse of discretion amounting to lack or excess of
jurisdiction in the passage and implementation of
Resolution Nos. 27 and 80, this petition must fail.
Finally, respondents were correct when they stated that
the extraordinary writ of mandamus is not applicable in
this case because the act being sought by petitioners to
be done is discretionary and not a ministerial duty. In
other words, mandamus lies only to compel the
performance, x x x of a ministerial duty, but not to
compel the performance of a discretionary duty. Since
grave abuse of discretion is not evident in this case, the
exceptional remedy of mandamus is unavailable. x x x
WHEREFORE, in view of all the foregoing and finding that
the assailed Resolution No. 27 dated July 9, 2001 and
Resolution No. 80 dated November 12, 2001 were not
issued by respondents with grave abuse of discretion
amounting to lack or excess of jurisdiction, the instant
appeal [sic] is DENIED DUE COURSE and,
accordingly, DISMISSED for lack of merit. The validity of
the assailed resolutions, being in accordance with law
and jurisprudence, is UPHELD.
SO ORDERED.[12]
Petitioners moved for a reconsideration[13] which was
denied by the CA in its October 6, 2003 Resolution.
Hence, petitioners availed of this recourse.
Petitioners Arguments
Petitioners contend that the March 20, 2003 Decision
and October 6, 2003 Resolution of the CA were not in
accordance with Republic Act (RA) No. 6656, otherwise
known as An Act to Protect the Security of Tenure of Civil
Service Officers and Employees in the Implementation of
Government Reorganization, specifically Section
2[14] thereof and RA 7305, otherwise known as the
Magna Carta of Health Workers.
Respondents Argument
Respondents, for their part, argue that petitioners
separation from service was a result of a valid
reorganization done in accordance with law and in good
faith.
Both parties filed their memoranda.[15] Thereafter, in a
Resolution[16] dated August 6, 2008, we required the
parties to submit supplemental memoranda discussing
therein their respective positions on the issue of
jurisdiction.
Issues
1) Whether petitioners automatic resort to
the Court of Appeals is proper.
2) Whether the case falls under the
exceptions to the rule on exhaustion of administrative
remedies.
Our Ruling
Petitioners recourse should have been with the Civil
Service Commission and not with the Court of Appeals
Section 2 (1) and Section 3, Article IX-B of the
Constitution provide that:
Section 2. (1) The civil service embraces all branches,
subdivisions, instrumentalities and agencies of the
Government, including government-owned or controlled
corporations with original charters.
Section 3. The Civil Service Commission, as the central
personnel agency of the Government, shall establish a
career service and adopt measures to promote morale,
efficiency, integrity, responsiveness, progressiveness,
and courtesy in the civil service. It shall strengthen the
merit and rewards system, integrate all human resources
development programs for all levels and ranks, and
institutionalize a management climate conducive to
public accountability. It shall submit to the President and
the Congress an annual report on its personnel
programs.
Corollary thereto, Section 4 of CSC Memorandum
Circular No. 19-99, states that:
Section 4. Jurisdiction of the Civil Service Commission. The
Civil Service Commission shall hear and decide
administrative cases instituted by, or brought before it,
directly or on appeal, including contested appointments,
and shall review decisions and actions of its offices and
of the agencies attached to it.
Except as otherwise provided by the Constitution or by
law, the Civil Service Commission shall have the final
authority to pass upon the removal, separation and
suspension of all officers and employees in the civil
service and upon all matters relating to the conduct,
discipline and efficiency of such officers and
employees. (Emphasis supplied)
Pursuant to the foregoing provisions, the CSC, as the
central personnel agency of the Government, has
jurisdiction over disputes involving the removal and
separation of all employees of government branches,
subdivisions, instrumentalities and agencies, including
government-owned or controlled corporations with
original charters. Simply put, it is the sole arbiter of
controversies relating to the civil service.[17]
In this case, petitioners are former local government
employees whose services were terminated due to the
reorganization of the municipal government under
Resolution Nos. 27 and 80 of the Sangguniang
Bayan of San Isidro, Nueva Ecija. Considering that they
belong to the civil service, the CSC has jurisdiction over
their separation from office.
Even the laws upon which petitioners anchor their claim
vest jurisdiction upon the CSC. Under RA 6656 and RA
7305, which were cited by the petitioners in their
petition, it is the CSC which determines whether an
employees dismissal or separation from office was
carried out in violation of the law or without due
process. Accordingly, it is also the CSC which has the
power to reinstate or reappoint an unlawfully dismissed
or terminated employee. Quoted hereunder are Section
9 of RA 6656 and Section 8 of RA 7305:
SECTION 9. All officers and employees who are found
by the Civil Service Commission to have been separated
in violation of the provisions of this Act, shall be
ordered reinstated or reappointed as the case may be
without loss of seniority and shall be entitled to full pay
for the period of separation. Unless also separated for
cause, all officers and employees, who have been
separated pursuant to reorganization shall, if entitled
thereto, be paid the appropriate separation pay and
retirement and other benefits under existing laws within
ninety (90) days from the date of the effectivity of their
separation or from the date of the receipt of the
resolution of their appeals as the case may be: Provided,
That application for clearance has been filed and no
action thereon has been made by the corresponding
department or agency. Those who are not entitled to
said benefits shall be paid a separation gratuity in the
amount equivalent to one (1) month salary for every
year of service. Such separation pay and retirement
benefits shall have priority of payment out of the savings
of the department or agency concerned. (Emphasis
supplied)
xxxx
SECTION 8. Security of Tenure. In case of regular
employment of public health workers, their services shall
not be terminated except for cause provided by law and
after due process: Provided, That if a public health
worker is found by the Civil Service Commission to be
unjustly dismissed from work, he/she shall be entitled
to reinstatement without loss of seniority rights and to
his/her back wages with twelve percent (12%) interest
computed from the time his/her compensation was
withheld from him/her up to the time of reinstatement.
(Emphasis supplied)
All told, we hold that it is the CSC which has jurisdiction
over appeals from personnel actions taken by
respondents against petitioners as a result of
reorganization. Consequently, petitioners resort to the
CA was premature. The jurisdiction lies with the CSC and
not with the appellate court.
The case does not fall under any of the exceptions to the
rule on exhaustion of administrative remedies
The rule on exhaustion of administrative remedies
provides that a party must exhaust all administrative
remedies to give the administrative agency an
opportunity to decide the matter and to prevent
unnecessary and premature resort to the courts.[18] This,
however, is not an ironclad rule as it admits of
exceptions,[19] viz:
1. when there is a violation of due process;
2. when the issue involved is purely a legal question;
3. when the administrative action is patently illegal
amounting to lack or excess of jurisdiction;
4. when there is estoppel on the part of the
administrative agency concerned;
5. when there is irreparable injury;
Thus, instead of immediately filing a petition with the CA,
petitioners should have first brought the matter to the
CSC which has primary jurisdiction over the
case.[22] Thus, we find that the CA correctly dismissed the
petition but not the grounds cited in support
thereof. The CA should have dismissed the petition for
non-exhaustion of administrative remedies.[23]
Considering our above findings, we find no cogent
reason to resolve the other issues raised by the
petitioners in their petition.
WHEREFORE, the instant petition is DENIED. The March
20, 2003 Decision of the Court of Appeals dismissing the
petition and its October 6, 2003 Resolution denying the
motion for reconsideration are AFFIRMED but on the
ground that petitioners failed to exhaust the
administrative remedies available to them.

6. when the respondent is a department secretary SO ORDERED.

whose acts as an alter ego of the President bears the
implied and assumed approval of the latter;

7. when to require exhaustion of administrative

remedies would be unreasonable;

8. when it would amount to a nullification of a claim;

9. when the subject matter is a private land in land case

proceedings;

10. when the rule does not provide a plain, speedy and
adequate remedy; and

11. when there are circumstances indicating the urgency

of judicial intervention.

The instant case does not fall under any of the

exceptions. Petitioners filing of a petition for mandamus
and prohibition with the CA was premature. It bears
stressing that the remedies of mandamus and
prohibition may be availed of only when there is no
appeal or any other plain, speedy and adequate remedy
in the ordinary course of law.[20] Moreover, being
extraordinary remedies, resort may be had only in cases
of extreme necessity where the ordinary forms of
procedure are powerless to afford relief.[21]
MOF COMPANY, G.R. No. 172822 would be the one to pay for the freight and other
INC., charges in the total amount of P57,646.00.[3]
Petitioner,
Present: The shipment arrived in Manila on October 29,
2001. Thereafter, petitioner MOF Company, Inc. (MOF),
CARPIO,* J., Chairperson, Hanjins exclusive general agent in the Philippines,
- versus - LEONARDO-DE CASTRO,** repeatedly demanded the payment of ocean freight,
BRION, documentation fee and terminal handling charges from
DEL CASTILLO, and Shin Yang. The latter, however, failed and refused to pay
ABAD, JJ. contending that it did not cause the importation of the
SHIN YANG goods, that it is only the Consolidator of the said
BROKERAGE shipment, that the ultimate consignee did not endorse in
CORPORATION, Promulgated: its favor the original bill of lading and that the bill of
Respondent. December 18, 2009 lading was prepared without its consent.
x---------------------------------------------
----------------------x Thus, on March 19, 2003, MOF filed a case for sum of
money before
the Metropolitan Trial Court of Pasay City (MeTC Pasay)
DECISION which was docketed as Civil Case No. 206-03 and raffled
to Branch 48. MOF alleged that Shin Yang, a regular
client, caused the importation and shipment of the
DEL CASTILLO, J.: goods and assured it that ocean freight and other
charges would be paid upon arrival of the goods
The necessity of proving lies with the person who sues. in Manila. Yet, after Hanjin's compliance, Shin Yang
unjustly breached its obligation to pay. MOF argued that
The refusal of the consignee named in the bill of Shin Yang, as the named consignee in the bill of lading,
lading to pay the freightage on the claim that it is not entered itself as a party to the contract and bound itself
privy to the contract of affreightment propelled the to the Freight Collect arrangement. MOF thus prayed for
shipper to sue for collection of money, stressing that its the payment of P57,646.00 representing ocean freight,
sole evidence, the bill of lading, suffices to prove that the documentation fee and terminal handling charges as
consignee is bound to pay. Petitioner now comes to us well as damages and attorneys fees.
by way of Petition for Review on Certiorari[1] under Rule
45 praying for the reversal of the Court of Appeals' (CA) Claiming that it is merely a consolidator/forwarder and
judgment that dismissed its action for sum of money for that Bill of Lading No. HJSCPUSI14168303 was not
insufficiency of evidence. endorsed to it by the ultimate consignee, Shin Yang
denied any involvement in shipping the goods or in
promising to shoulder the freightage. It asserted that it
Factual Antecedents never authorized Halla Trading Co. to ship the articles or
to have its name included in the bill of lading. Shin Yang
On October 25, 2001, Halla Trading Co., a company also alleged that MOF failed to present supporting
based in Korea, shipped to Manila secondhand cars and documents to prove that it was Shin Yang that caused
other articles on board the vessel the importation or the one that assured payment of the
Hanjin Busan 0238W. The bill of lading covering the shipping charges upon arrival of the goods in Manila.
shipment, i.e., Bill of Lading No.
[2]
HJSCPUSI14168303, which was prepared by the carrier Ruling of the Metropolitan Trial Court
Hanjin Shipping Co., Ltd. (Hanjin), named respondent
Shin Yang Brokerage Corp. (Shin Yang) as the consignee On June 16, 2004, the MeTC of Pasay City, Branch 48
and indicated that payment was on a Freight Collect rendered its Decision[4] in favor of MOF. It ruled that Shin
basis, i.e., that the consignee/receiver of the goods
Yang cannot disclaim being a party to the contract of
affreightment because:
x x x it would appear that defendant has business
transactions with plaintiff. This is evident from
defendants letters dated 09 May 2002 and 13 May 2002
(Exhibits 1 and 2, defendants Position Paper) where it
requested for the release of refund of container deposits
x x x. [In] the mind of the Court, by analogy, a written
contract need not be necessary; a mutual understanding
[would suffice]. Further, plaintiff would have not
included the name of the defendant in the bill of lading,
had there been no prior agreement to that effect.
In sum, plaintiff has sufficiently proved its cause of action
against the defendant and the latter is obliged to honor
its agreement with plaintiff despite the absence of a
written contract.[5]
The dispositive portion of the MeTC Decision reads:
WHEREFORE, premises considered, judgment is hereby
rendered in favor of plaintiff and against the defendant,
ordering the latter to pay plaintiff as follows:
1. P57,646.00 plus legal interest from the date of
demand until fully paid,
2. P10,000.00 as and for attorneys fees and
3. the cost of suit.
SO ORDERED.[6]
Ruling of the Regional Trial Court
The Regional Trial Court (RTC) of Pasay City, Branch 108
affirmed in toto the Decision of the MeTC. It held that:
MOF and Shin Yang entered into a contract of
affreightment which Blacks Law Dictionary defined as a
contract with the ship owner to hire his ship or part of it,
for the carriage of goods and generally take the form
either of a charter party or a bill of lading.
The bill of lading contain[s] the information embodied in
the contract.
Article 652 of the Code of Commerce provides that the
charter party must be in writing; however, Article 653
says: If the cargo should be received without charter
party having been signed, the contract shall be
understood as executed in accordance with what
appears in the bill of lading, the sole evidence of title
with regard to the cargo for determining the rights and
obligations of the ship agent, of the captain and of the
charterer. Thus, the Supreme Court opined in the
Market Developers, Inc. (MADE) vs. Honorable
Intermediate Appellate Court and Gaudioso Uy, G.R. No.
74978, September 8, 1989, this kind of contract may be
oral. In another case, Compania Maritima vs. Insurance
Company of North America, 12 SCRA 213 the contract of
affreightment by telephone was recognized where the
oral agreement was later confirmed by a formal booking.
xxxx
Defendant is liable to pay the sum of P57,646.00, with
interest until fully paid, attorneys fees of P10,000.00
[and] cost of suit.
Considering all the foregoing, this Court affirms in
toto the decision of the Court a quo.
SO ORDERED.[7]
Ruling of the Court of Appeals
Seeing the matter in a different light, the CA dismissed
MOFs complaint and refused to award any form of
damages or attorneys fees. It opined that MOF failed to
substantiate its claim that Shin Yang had a hand in the
importation of the articles to the Philippines or that it
gave its consent to be a consignee of the subject
goods. In its March 22, 2006 Decision,[8] the CA said:
This Court is persuaded [that except] for the Bill of
Lading, respondent has not presented any other
evidence to bolster its claim that petitioner has entered
[into] an agreement of affreightment with respondent,
be it verbal or written. It is noted that the Bill of Lading
was prepared by Hanjin Shipping, not the
petitioner. Hanjin is the principal while respondent is the
formers agent. (p. 43, rollo)
The conclusion of the court a quo, which was upheld by
the RTC Pasay City, Branch 108 xxx is purely speculative
and conjectural. A court cannot rely on speculations,
conjectures or guesswork, but must depend upon
competent proof and on the basis of the best evidence
obtainable under the circumstances. Litigation cannot be
properly resolved by suppositions, deductions or even
presumptions, with no basis in evidence, for the truth
must have to be determined by the hard rules of
admissibility and proof (Lagon vs. Hooven Comalco
Industries, Inc. 349 SCRA 363).
While it is true that a bill of lading serves two (2)
functions: first, it is a receipt for the goods shipped;
second, it is a contract by which three parties, namely,
the shipper, the carrier and the consignee who
undertake specific responsibilities and assume stipulated
obligations (Belgian Overseas Chartering and Shipping
N.V. vs. Phil. First Insurance Co., Inc., 383 SCRA 23), x x x
if the same is not accepted, it is as if one party does not
accept the contract. Said the Supreme Court:
A bill of lading delivered and accepted constitutes the
contract of carriage[,] even though not signed, because
the acceptance of a paper containing the terms of a
proposed contract generally constitutes an acceptance
of the contract and of all its terms and conditions of
which the acceptor has actual or constructive notice
(Keng Hua Paper Products Co., Inc. vs. CA, 286 SCRA
257).
In the present case, petitioner did not only [refuse to]
accept the bill of lading, but it likewise disown[ed] the
shipment x x x. [Neither did it] authorize Halla Trading
Company or anyone to ship or export the same on its
behalf.
It is settled that a contract is upheld as long as there is
proof of consent, subject matter and cause (Sta. Clara
Homeowners Association vs. Gaston, 374 SCRA 396). In
the case at bar, there is not even any iota of evidence to
show that petitioner had given its consent.
He who alleges a fact has the burden of proving it and a
mere allegation is not evidence (Luxuria Homes Inc. vs.
CA, 302 SCRA 315).
The 40-footer van contains goods of substantial value. It
is highly improbable for petitioner not to pay the
charges, which is very minimal compared with the value
of the goods, in order that it could work on the release
thereof.
For failure to substantiate its claim by preponderance of
evidence, respondent has not established its case against
petitioner.[9]
Petitioners filed a motion for reconsideration but it was
denied in a Resolution[10] dated May 25, 2006. Hence,
this petition for review on certiorari.
Petitioners Arguments
In assailing the CAs Decision, MOF argues that the factual
findings of both the MeTC and RTC are entitled to great
weight and respect and should have bound the CA. It
stresses that the appellate court has no justifiable reason
to disturb the lower courts judgments because their
conclusions are well-supported by the evidence on
record.
MOF further argues that the CA erred in labeling the
findings of the lower courts as purely speculative and
conjectural. According to MOF, the bill of lading, which
expressly stated Shin Yang as the consignee, is the best
evidence of the latters actual participation in the
transportation of the goods. Such document, validly
entered, stands as the law among the shipper, carrier
and the consignee, who are all bound by the terms
stated therein. Besides, a carriers valid claim after it
fulfilled its obligation cannot just be rejected by the
named consignee upon a simple denial that it ever
consented to be a party in a contract of affreightment, or
that it ever participated in the preparation of the bill of
lading. As against Shin Yangs bare denials, the bill of
lading is the sufficient preponderance of evidence
required to prove MOFs claim. MOF maintains that Shin
Yang was the one that supplied all the details in the bill
of lading and acquiesced to be named consignee of the
shipment on a Freight Collect basis.
Lastly, MOF claims that even if Shin Yang never gave its
consent, it cannot avoid its obligation to pay, because it
never objected to being named as the consignee in the
bill of lading and that it only protested when the
shipment arrived in the Philippines, presumably due to a
botched transaction between it and Halla Trading
Co. Furthermore, Shin Yangs letters asking for the refund
of container deposits highlight the fact that it was aware
of the shipment and that it undertook preparations for
the intended release of the shipment.
Respondents Arguments
Echoing the CA decision, Shin Yang insists that MOF has
no evidence to prove that it consented to take part in
the contract of affreightment. Shin Yang argues that
MOF miserably failed to present any evidence to prove
that it was the one that made preparations for the
subject shipment, or that it is an actual shipping practice
that forwarders/consolidators as consignees are the
ones that provide carriers details and information on the
bills of lading.
Shin Yang contends that a bill of lading is essentially a
contract between the shipper and the carrier and
ordinarily, the shipper is the one liable for the freight
charges. A consignee, on the other hand, is initially a
stranger to the bill of lading and can be liable only when
the bill of lading specifies that the charges are to be paid
by the consignee. This liability arises from either a) the
contract of agency between the shipper/consignor and
the consignee; or b) the consignees availment of the
stipulation pour autrui drawn up by and between the
shipper/ consignor and carrier upon the consignees
demand that the goods be delivered to it. Shin Yang
contends that the fact that its name was mentioned as
the consignee of the cargoes did not make it
automatically liable for the freightage because it never
benefited from the shipment. It never claimed or
accepted the goods, it was not the shippers agent, it was
not aware of its designation as consignee and the
original bill of lading was never endorsed to it.
Issue
The issue for resolution is whether a consignee, who is
not a signatory to the bill of lading, is bound by the
stipulations thereof. Corollarily, whether respondent
who was not an agent of the shipper and who did not
make any demand for the fulfillment of the stipulations
of the bill of lading drawn in its favor is liable to pay the
corresponding freight and handling charges.
Our Ruling
Since the CA and the trial courts arrived at different
conclusions, we are constrained to depart from the
general rule that only errors of law may be raised in a
Petition for Review on Certiorari under Rule 45 of the
Rules of Court and will review the evidence presented.[11]
The bill of lading is oftentimes drawn up by the
shipper/consignor and the carrier without the
intervention of the consignee. However, the latter can
be bound by the stipulations of the bill of lading when a)
there is a relation of agency between the shipper or
consignor and the consignee or b) when the consignee
demands fulfillment of the stipulation of the bill of lading
which was drawn up in its favor.[12]
In Keng Hua Paper Products Co., Inc. v. Court of
Appeals,[13] we held that once the bill of lading is received
by the consignee who does not object to any terms or
stipulations contained therein, it constitutes as an
acceptance of the contract and of all of its terms and
conditions, of which the acceptor has actual or
constructive notice.
In Mendoza v. Philippine Air Lines, Inc.,[14] the consignee
sued the carrier for damages but nevertheless claimed
that he was never a party to the contract of
transportation and was a complete stranger thereto. In
debunking Mendozas contention, we held that:
x x x First, he insists that the articles of the Code of
Commerce should be applied; that he invokes the
provisions of said Code governing the obligations of a
common carrier to make prompt delivery of goods given
to it under a contract of transportation. Later, as already
said, he says that he was never a party to the contract of
transportation and was a complete stranger to it, and
that he is now suing on a tort or a violation of his rights
as a stranger (culpa aquiliana). If he does not invoke the
contract of carriage entered into with the defendant
company, then he would hardly have any leg to stand
on. His right to prompt delivery of the can of film at
the Pili Air Port stems and is derived from the contract of
carriage under which contract, the PAL undertook to
carry the can of film safely and to deliver it to him
promptly. Take away or ignore that contract and the
obligation to carry and to deliver and right to prompt
delivery disappear. Common carriers are not obligated
by law to carry and to deliver merchandise, and persons
are not vested with the right to prompt delivery, unless
such common carriers previously assume the obligation.
Said rights and obligations are created by a specific
contract entered into by the parties. In the present case,
the findings of the trial court which as already stated,
are accepted by the parties and which we must accept
are to the effect that the LVN Pictures Inc. and Jose
Mendoza on one side, and the defendant company on
the other, entered into a contract of transportation (p.
29, Rec. on Appeal). One interpretation of said finding is
that the LVN Pictures Inc. through previous agreement
with Mendoza acted as the latter's agent. When he
negotiated with the LVN Pictures Inc. to rent the film
'Himala ng Birhen' and show it during the Naga town
fiesta, he most probably authorized and enjoined the
Picture Company to ship the film for him on the PAL on
September 17th. Another interpretation is that even if
the LVN Pictures Inc. as consignor of its own initiative,
and acting independently of Mendoza for the time
being, made Mendoza a consignee. [Mendoza made
himself a party to the contract of transportaion when
he appeared at the Pili Air Port armed with the copy of
the Air Way Bill (Exh. 1) demanding the delivery of the
shipment to him.] The very citation made by appellant in
his memorandum supports this view. Speaking of the
possibility of a conflict between the order of the shipper
on the one hand and the order of the consignee on the
other, as when the shipper orders the shipping company
to return or retain the goods shipped while the
consignee demands their delivery, Malagarriga in his
book Codigo de Comercio Comentado, Vol. 1, p. 400,
citing a decision of the Argentina Court of Appeals on
commercial matters, cited by Tolentino in Vol. II of his
book entitled 'Commentaries and Jurisprudence on the
Commercial Laws of the Philippines' p. 209, says that the
right of the shipper to countermand the shipment
terminates when the consignee or legitimate holder of
the bill of lading appears with such bill of lading before
the carrier and makes himself a party to the contract.
Prior to that time he is a stranger to the contract.
Still another view of this phase of the case is that
contemplated in Art. 1257, paragraph 2, of the old Civil
Code (now Art. 1311, second paragraph) which reads
thus:
Should the contract contain any stipulation in favor of a
third person, he may demand its fulfillment provided
he has given notice of his acceptance to the person
bound before the stipulation has been revoked.'
Here, the contract of carriage between the LVN Pictures
Inc. and the defendant carrier contains the stipulations
of delivery to Mendoza as consignee. His demand for
the delivery of the can of film to him at
the Pili Air Port may be regarded as a notice of his
acceptance of the stipulation of the delivery in his favor
contained in the contract of carriage and delivery. In
this case he also made himself a party to the contract,
or at least has come to court to enforce it. His cause of
action must necessarily be founded on its
breach.[15] (Emphasis Ours)
In sum, a consignee, although not a signatory to the
contract of carriage between the shipper and the carrier,
becomes a party to the contract by reason of either a)
the relationship of agency between the consignee and
the shipper/ consignor; b) the unequivocal acceptance of
the bill of lading delivered to the consignee, with full
knowledge of its contents or c) availment of the
stipulation pour autrui, i.e., when the consignee, a third
person, demands before the carrier the fulfillment of the
stipulation made by the consignor/shipper in the
consignees favor, specifically the delivery of the
goods/cargoes shipped.[16]
In the instant case, Shin Yang consistently denied in all of
its pleadings that it authorized Halla Trading, Co. to ship
the goods on its behalf; or that it got hold of the bill of
lading covering the shipment or that it demanded the
release of the cargo. Basic is the rule in evidence that the
burden of proof lies upon him who asserts it, not upon
him who denies, since, by the nature of things, he who
denies a fact cannot produce any proof of
it.[17] Thus, MOF has the burden to controvert all these
denials, it being insistent that Shin Yang asserted itself as
the consignee and the one that caused the shipment of
the goods to the Philippines.
In civil cases, the party having the burden of proof must
establish his case by preponderance of
[18]
evidence, which means evidence which is of greater
weight, or more convincing than that which is offered in
opposition to it.[19] Here, MOF failed to meet the
required quantum of proof. Other than presenting the
bill of lading, which, at most, proves that the carrier
acknowledged receipt of the subject cargo from the
shipper and that the consignee named is to shoulder the
freightage, MOF has not adduced any other credible
evidence to strengthen its cause of action. It did not even
present any witness in support of its allegation that it
was Shin Yang which furnished all the details indicated in
the bill of lading and that Shin Yang consented to
shoulder the shipment costs. There is also nothing in the
records which would indicate that Shin Yang was an
agent of Halla Trading Co. or that it exercised any act that
would bind it as a named consignee. Thus, the CA
correctly dismissed the suit for failure of petitioner to
establish its cause against respondent.

WHEREFORE, the petition is DENIED. The assailed

Decision of the Court of Appeals dated March 22,
2006 dismissing petitioners complaint and the
Resolution dated May 25, 2006denying the motion
for reconsideration are AFFIRMED.

SO ORDERED.
SPOUSES PATRICIO G.R. No. 163271 evidence on record, petitioners now come to us via the
and instant Petition for Review on Certiorari.[5]
MYRNA BERNALES,
Petitioners, Factual Antecedents

- versus - Julian Sambaan (Julian), married to Guillerma Saarenas-

Sambaan (Guillerma), was the registered owner of a
HEIRS OF JULIAN Present: property located at Bulua, Cagayan de Oro City. The lot
SAMBAAN, was covered by Transfer Certificate of Title (TCT) No. T-
namely: EMMA S. 14202[6] issued on March 8, 1972, and more particularly
FELICILDA, described as follows:
ANITA S. SAMBAAN, CARPIO, J., Chairperson,
VIOLETA S. BRION, A parcel of land (Lot No. 5947-A of the Subdivision Plan
DADSANAN, (LRC) Psd-138019, being a portion of Lot No. 5947,
ABSALON S. DEL CASTILLO, Cagayan Cadastre, LRC Cad. Rec. No. 1572) situated in
SAMBAAN, the Barrio of Bulua, City of Cagayan de
AGUSTINE S. ABAD, and Oro, Island of Mindanao x x x containing an area of
SAMBAAN, THREE THOUSAND SIX HUNDRED FORTY THREE (3,643)
EDITHA S. PEREZ, JJ. SQUARE METERS, more or less.
MANGUIRAN,
GRACE S. NITCHA. The respondents herein and the petitioner Myrna
CLODUALDO S. Bernales (Myrna) are the children of Julian and
SAMBAAN, Guillerma. Myrna, who is the eldest of the siblings, is the
GINA S. SAMBAAN present owner and possessor of the property in
and question.
FE S. YAP, Promulgated:
Respondents. January 15, 2010 Sometime in 1975, Julian was ambushed at Merayon,
x--------------------------------------------- Talakad, Bukidnon, and was hospitalized due to a
----------------------x gunshot wound. On April 11, 1975, Julian allegedly
requested his children to gather so that he could make
his last two wishes. Julians first wish was for the children
DECISION to redeem the subject property which was mortgaged to
Myrna and her husband Patricio Bernales (Patricio),
while his second wish was for his remains not to be
DEL CASTILLO, J.: brought to the house of Myrna at Nazareth, Cagayan de
Oro City. Thus, in 1982, respondent Absalon Sambaan
A legal tussle among children is a nightmare for their (Absalon), one of Julians children, offered to redeem the
parents. Sometimes, this happens when pecuniary property but the petitioners refused because they were
interests takes precedence over family relationship. In allegedly using the property as tethering place for their
the instant case, we are at the forefront of a family cattle.
squabble over a disputed land situated in Cagayan de
Oro City which was purportedly conveyed to the eldest In January 1991, respondents received information that
child through a Deed of Absolute Sale.[1] the property covered by TCT No. T-14202 was already
transferred to petitioners name. Whereupon, they
Branch 18 of the Regional Trial Court (RTC) of Misamis secured a copy of the Deed of Absolute
Oriental[2] rendered judgment in favor of the herein Sale dated December 7, 1970 which bore the signatures
respondents, which was affirmed in toto by the Court of of their parents and had it examined by the National
Appeals[3] (CA).Alleging that the CA Decision[4] is not in Bureau of Investigation (NBI). The result of the
accordance with law and jurisprudence, as well as the
examination revealed that the signatures of their
parents, Julian and Guillerma, were forged.
Proceedings before the Regional Trial Court
Thus, on April 13, 1993, the respondents, together with
their mother Guillerma, filed a Complaint for Annulment
of Deed of Absolute Sale and Cancellation of Transfer
Certificate of Title No. T-14204 with Damages and Writ
of Preliminary Injunction[7] against herein
petitioners. They alleged that in spite of the forged
signature of their parents, the petitioners were able to
register the Deed of Absolute Sale with the Registry of
Deeds of Cagayan de Oro City and secure TCT No. T-
14204[8] on March 8, 1972. They prayed for an injunctive
relief in order to prevent the petitioners from selling,
disposing, or mortgaging said property. They further
prayed that (i) the Deed of Absolute Sale and TCT No. T-
14204 be annulled; (ii) they be declared the absolute
owners of the property; (iii) all documents executed,
made and entered into relative to the said title be
declared void; and, (iv) the petitioners be ordered to pay
them P300,000.00 as moral and exemplary damages,
and P50,000.00 as attorneys fees plus P1,000.00 as
appearance fee.
On May 6, 1992, petitioners filed their Answer,[9] alleging
that the subject property (Lot No. 5947-A) used to be a
portion of Lot No. 5947, which was originally owned by
Clodualdo Sambaan (Clodualdo) and Gliceria Dacer
(Gliceria). Lot No. 5947 is more particularly described as
follows:
A parcel of land (Lot No. 5947 of the Cadastral Survey of
Cagayan) situated at Bulua, Cagayan de Oro
City. Bounded on the NE., by Lot No. 5984 and 5948; E.,
by Lot Nos. 5948 and 5946, SW., by Lot No. 5946; and on
the NW., by Lot No. 5984, containing an area of 7,286
square meters, more or less, under Tax Declaration No.
21421 and covered by Original Certificate of Title No.
7921 issued on September 23, 1940.
After the death of Clodualdo and Gliceria in 1949, their
heirs, namely, Alicia Lago, wife of Pedro Gacusan;
Bernardo Lago (single); Gloria Lago, wife of Jimmy
Angco; Dionesia Lago, married to Paulino Unat;
Prysbetero Sambaan, married to Rosario Zaragosa;
Juanito Sambaan, married to Renerio Galos; Leo
Sambaan, married to Adeloisa Tambulian; Renato
Sambaan, married to Adelina Ablon; Aida Sambaan
(single); Julian Sambaan, married to Guillerma Saarenas;
Paz Sambaan, wife of Rufinito Lago; and, Bernie
Sambaan, married to Alicia Sabuero, executed an Extra
Judicial Settlement and Sale[10] dated April 10, 1970
involving the abovementioned land covered by Original
Certificate of Title (OCT) No. 7921.
It appears, however, that Juanito, Aida and Renato sold
their share to a certain Domingo Ebarrat
(Ebarrat). Hence, a portion of the property belonged to
Julian while another portion belonged to Ebarrat. In view
of the co-ownership between Ebarrat and Julian, the
former and the latter executed a Deed of
Partition[11] dated September 8, 1970 whereby Lot No.
5947 was divided. The eastern half with an area of 3,643
square meters was assigned to Julian, while the western
half with the same area went to Ebarrat.
Petitioners claimed that Julian subsequently sold his
share to them by virtue
of a Deed of Absolute Sale [12] dated December 7,
1970. The said property is
described as follows:
A Parcel of land (Lot No. 5947-A, being a portion
of Lot No. 5947, Cadastral Survey of Cagayan) situated at
Bulua, Cagayan de Oro City. Bounded on the North
by Lot Nos. 5947-B and 5948, Cad. 237; South
by Lot Nos. 5946, Cad-237; East by Lot Nos. 5948 and
5946, Cad. 237; and West by Lot No. 5947-B, containing
an area of 3643 square meters, more or less, covered by
OCT No. 7921 (now TCT No. T-14202) of the Registry of
Deeds of Cagayan de Oro City.
Thereafter, on December 10, 1970, Ebarrat and Patricio
executed an Agreement[13] wherein Ebarrat
acknowledged that petitioners are the owners of the 18
coconut trees planted in Ebarrats property and even
made Julian as a witness to the said Agreement.
In addition, petitioners alleged that the imputation of
falsification of the signatures of Julian and Guillerma is a
product of respondents inflamed imagination because
the latter envy them for they have been successful in
managing their properties. Petitioners thus prayed that
judgment be rendered dismissing the complaint;
affirming their title over the controverted property and
ordering respondents to pay them P500,000.00 as moral
damages; P300,000.00 as exemplary
damages; P50,000.00 as attorneys fees and costs of
litigation.
On July 27, 1992, petitioners filed a Motion for
Production and Inspection of Document[14] to compel
respondents to produce and permit them to inspect and
to copy or photograph the Deed of Absolute Sale subject
matter of said examination. Thereafter, the trial court
issued an Order[15] dated August 14, 1992 granting the
motion and directing the Regional Office of the NBI to
bring the document to court so that the same may be
properly examined.
On August 11, 1992, Guillerma died in Cagayan de Oro
City and was accordingly dropped as co-plaintiff.
After trial on the merits, the trial court rendered
its Decision[16] dated August 2, 2001 ruling in favor of the
respondents, the dispositive portion of which reads:
WHEREFORE, in view of the foregoing, the plaintiffs were
able to establish a strong preponderance of evidence in
their favor. Accordingly, Transfer Certificate of Title No.
T-14204 is hereby declared NULL AND VOID, and is
hereby CANCELLED. Let another title be issued in the
name of the late Julian Sambaan. The defendants are
jointly and severally directed to pay the plaintiffs the sum
of P20,000.00 as moral damages, P20,000.00 as
attorneys fees and P1,671.00 representing actual
expenses.[17]
Proceedings before the Court of Appeals
Petitioners, alleging among others that the trial court
erred in finding that the signature of Julian on the
assailed document was a forgery, went to the CA by way
of ordinary appeal. On August 20, 2003, the CA rendered
a Decision affirming the findings of the trial court, the
dispositive portion of which reads:
WHEREFORE, premises considered, the appealed
Decision dated August 2, 2001 of
the Regional Trial Court of Cagayan de Oro City, Branch
18, in Civil Case no. 92-179 is hereby AFFIRMED in
toto. Costs against appellants.[18]
Petitioners filed a Motion for Reconsideration[19] which
was denied by the CA in its Resolution[20] dated March
17, 2004.
Issues
In this Petition for Review on Certiorari, petitioners assail
the Decision of the CA on the following grounds:
A. THE COURT OF APPEALS ERRED WHEN IT RULED THAT
PRESCRIPTION DID NOT BAR RESPONDENTS ACTION TO
RECOVER OWNERSHIP OF THE SUBJECT PROPERTY.
B. THE COURT OF APPEALS ERRED WHEN IT
DISREGARDED SETTLED PRINCIPLES ON THE
ADMISSIBILITY AND APPRECIATION OF OPINIONS OF
EXPERT WITNESSES IN ITS BLANKET ACCEPTANCE OF
THE INADEQUATE TESTIMONY OF THE DOCUMENT
EXAMINER WHO WAS COMMISSIONED BY
RESPONDENTS PRIOR TO THE COMMENCEMENT OF
CIVIL CASE NO. 92-179.
C. THE COURT OF APPEALS ERRED WHEN IT
DISREGARDED THE RULES OF EVIDENCE IN ARRIVING AT
THE CONCLUSION THAT THE DEED OF ABSOLUTE SALE
WAS A FORGED DOCUMENT ON THE BASIS OF
SPECIMEN SIGNATURES THE GENUINENESS OF WHICH
WERE NEVER ESTABLISHED.
D. THE COURT OF APPEALS ERRED WHEN IT
DISREGARDED LEGAL PRINCIPLES ON HANDWRITING
COMPARISON IN USING SPECIMEN SIGNATURES OF
GUILLERMA SAMBAAN THAT WERE MADE AT THE TIME
AND FOR THE SPECIFIC PURPOSE OF THE HANDWRITING
ANALYSIS OF THE DEED OF ABSOLUTE SALE.
E. THE COURT OF APPEALS ERRED WHEN IT
DISREGARDED JURISPRUDENCE ON THE PROOF
REQUIRED TO ESTABLISH FORGERY IN ARRIVING AT THE
CONCLUSION THAT THE SIGNATURE OF JULIAN
SAMBAAN ON THE DEED OF ABSOLUTE SALE WAS
FORGED BECAUSE IT BELIEVED THAT GUILLERMA
SAMBAANS SIGNATURE WAS ALSO FORGED.
F. THE COURT OF APPEALS CONTRAVENED THE LEGAL
RULES GOVERNING THE APPRECIATION OF
DOCUMENTS IN RULING AGAINST THE VALIDITY OF
JULIAN SAMBAANS SALE OF THE SUBJECT PROPERTY TO
PETITIONERS DESPITE THE EXISTENCE OF THE
AGREEMENT DATED 10 DECEMBER 1970 CONFIRMING
THE SALE.
G. THE COURT OF APPEALS ERRED IN AFFIRMING THE
TRIAL COURTS AWARD OF DAMAGES IN FAVOR OF
RESPONDENTS AND IN DISMISSING PETITIONERS
COUNTERCLAIMS FOR DAMAGES.
Our Ruling
The core issue to be resolved in the present controversy
is the authenticity of the Deed of Absolute Sale which is a
question of fact rather than of law. In Manila Bay Club
Corporation v.Court of Appeals,[21] we held that for a
question to be one of law, it must involve no
examination of the probative value of the evidence
presented by the litigants or any of them. There is a
question of law when the doubt or difference arises as to
what the law is pertaining to a certain state of facts. On
the other hand, there is a question of fact when the
doubt arises as to the truth or the falsity of alleged
facts.[22]
In the case at bench, the issues raised by the petitioners
are essentially factual matters, the determination of
which are best left to the courts below. Well-settled is
the rule that the Supreme Court is not a trier of
facts. Factual findings of the lower courts are entitled to
great weight and respect on appeal, and in fact accorded
finality when supported by substantial evidence on the
record.[23] Substantial evidence is more than a
mere scintilla of evidence. It is that amount of relevant
evidence that a reasonable mind might accept as
adequate to support a conclusion,[24] even if other
minds, equally reasonable, might conceivably opine
otherwise.[25] But to erase any doubt on the correctness
of the assailed ruling, we have carefully perused the
records and, nonetheless, arrived at the same
conclusion. We find that there is substantial evidence on
record to support the Court of Appeals and trial courts
conclusion that the signatures of Julian and Guillerma in
the Deed of Absolute Sale were forged.
The examination conducted by the NBI disclosed that
Julian and Guillermas signatures were forged.
We find that both the trial court and the Court of
Appeals correctly gave probative value to the testimony
of the NBI Senior Document Examiner Caroline Moldez
Pitoy, who categorically testified that the signatures of
Julian and Guillerma in the Deed of Absolute Sale were
forged, viz:[26]
Atty. Dalisay: As Senior Document Examiner of the
National Bureau of Investigation, do [sic] you have [the]
occasion of examining [sic] the signatures of Julian
Sambaan and Guillerma Saarenas by virtue of the case of
the Regional Director, Regional Office of the National
Bureau of Investigation, Cagayan de Oro City?
A: Yes sir.
xxxx
Q: What was the result of the findings on the signatures
of Julian Sambaan and Guillerma Saarenas Sambaan
appearing on the Deed of Sale dated December 12,
1990.
A: After [conducting] comparative examinations x x x on
the standard specimen signatures of Julian Sambaan
[and Guillerma Sambaan] as well as the x x x questioned
x x x signatures x x x we found out that [they were] not
written by one and the same person.[27]
xxxx
Q: What was the procedure which you have taken x x x
in examining the authenticity of the signatures of
Guillerma Saarenas Sambaan?
A: Per Standard Operating Procedures, the first thing we
did upon receipt of the documents submitted to us is to
check x x x the documents attached to the basic letter-
request and then the questioned and standard
documents were classified as to the sufficiency and
appropriateness of the standards, and then these were
evaluated, after which, they were marked accordingly,
then we go to examining all the standard/specimens
first, to determine whether the handwriting is done by
one and the same person before comparing with the
questioned and standard signatures. x x x After they
were found to be written by one and the same person,
before comparing with the questioned documents, the
handwriting characteristics were properly observed in
these two (2) sheets of photographs, then, the final
evaluation is made, after which, a written report is made
as a result of the examination, then the same is
forwarded to the Document Examiner for re-
examination and this Examiner affixes his signature and
submits the same to the Chief of the Division for
approval and the said report passes to the office of the
Regional Director for final approval.
Petitioners failed to present any evidence to rebut the
findings of the NBI handwriting expert.
Moreover, the findings of the NBI document examiner
were corroborated by the trial courts own observation,
as affirmed by the CA, that even a cursory examination
of Guillermas questioned signature from her specimen
signatures in the enlarged photographs (Exhibits F and F-
1) would show that it needs no expert witness to notice
the wide difference in stroke, as well as the writing style
in capital G.[28] What is more, Emma S. Felicilda, the
daughter of then deceased Guillerma, likewise testified
that in fact my mother was the one who filed the
complaint in this instant case because according to her,
she did not sign the said document.[29]
The fact that the examination was commissioned by the
respondents did not make said examination null and
void.
It is of no moment that the examination of the Deed of
Absolute Sale was commissioned by the respondents. In
the end, it is the court which has the discretion and
authority on whether to give probative value to the
results of the examination. As held in Sali v.
Abubakar,[30] the fact that the NBI conducted the
examination of certain contested documents upon the
request of a private litigant does not necessarily nullify
the examination thus made:
x x x Its purpose is, presumably, to assist the court having
jurisdiction over said litigations, in the performance of its
duty to settle correctly the issue relative to said
documents. Even a non-expert private individual may
examine the same, if there are facts within his
knowledge which may help the courts in the
determination of said issue. Such examination, which
may properly be undertaken by a non-expert private
individual, does not, certainly, become null and void
when the examiner is an expert and/or an officer of the
NBI.
Indeed, any person, expert or not, either in his private or
in his official capacity, may testify in court on matters,
within his personal knowledge, which are relevant to a
suit, subject to the judicial authority to determine the
credibility of said testimony and the weight thereof. [On]
the other hand, the question whether a public official
may or shall be ordered or permitted by his superior to
examine documents and testify thereon in a given case,
is one mainly administrative in character, which is within
the competence of said superior officer, or the Bureau
Director or Head of the Office, or the corresponding
department head to decide, and is independent of the
validity of the examination thus made or of the credence
and weight to be given by the Court to the conclusions
reached, in consequence of said examination, by the
official who made it.
The procedures taken by the NBI document examiner did
not violate Section 22, Rule 132 of the Rules of Court.
We are not swayed by petitioners allegation that the
comparisons made by the document examiner, the CA
and the trial court, of Guillermas signature in the Deed of
Absolute Sale and her specimen signatures, violated
Section 22, Rule 132[31] of the Rules of Court on the
authentication of private documents. It should be borne
in mind that in this case respondents were not
presenting evidence to authenticate a private
document. On the contrary, they are challenging the
signatures appearing in the Deed of Absolute Sale.
The confluence of the following circumstances prove by
preponderance of evidence that the Deed of
Absolute Sale was forged.
Records show that Julian was unaware of any absolute
conveyance of his rights over the subject property in
favor of petitioners. As found by the trial court and
affirmed by the CA, Julian even requested his children to
redeem subject property from the petitioners. In
furtherance of his fathers request, Absalon offered to
redeem the subject property from the petitioners in
1982, however, the latter refused because they were
allegedly using the same as tethering place for their
cattle.[32]
The caretaker of the subject property, Eufronio Abrea,
also testified on cross-examination that there were times
when the brothers and sisters of Myrna went to the land
and asked for coconuts.[33] Petitioners take this to imply
that the respondents never owned the subject property
because they had to ask for coconuts from petitioners,
who were the real owners of the property.[34] We
disagree with this interpretation. Harvesting of coconuts
requires specialized skills; an ordinary person who does
not know how to climb necessarily has to ask the
caretaker to get the coconuts for him or her.
In addition, Myrna admitted that she was not present
when her parents signed the assailed Deed of Absolute
Sale.[35] Neither was she cognizant of who the witnesses
were to the said deed.[36] Interestingly, Guillerma, one of
the alleged signatories, would have been privy to the
transaction that involved her husband. Yet, she joined
herein respondents in filing an action for the Annulment
of the Deed of Absolute Sale on the ground of forgery.
Lastly, the trial court and the CA were one in proclaiming
that considering that the subject property belongs to
Julians capital, the execution of the assailed Deed of
Absolute Sale could be validly made by Julian even
without his wifes signature.[37] As a matter of fact, the
wifes name was not typed in the assailed deed and her
purported signature merely appears next to the
supposed signature of Julian. This only confirms that the
person who prepared the deed knew that her signature
was unnecessary for the assailed document.
The trial court and the CA further concluded:
x x x If such was the case, we are in a query why the
signature of GUILLERMA must have to be forged when
her consent, as spouse of JULIAN, is not necessary to the
execution of the Deed of Absolute Sale?The answer to
this is simple: JULIAN never executed the assailed Deed
of Absolute Sale in favor of MYRNA and such deed
conveys no ownership in favor of the appellants.[38]
Conclusions and findings of fact by the trial court are
entitled to great weight on appeal and should not be
disturbed unless for strong and cogent reasons because
the trial court is in a better position to examine real
evidence, as well as to observe the demeanor of the
witnesses while testifying in the case.[39] The fact that the
CA adopted the findings of fact of the trial court makes
the same binding upon this court.[40] In Philippine
Airlines, Inc. v. Court of Appeals, [41] we held that factual
findings of the CA which are supported by substantial
evidence are binding, final and conclusive upon the
Supreme Court. A departure from this rule may be
warranted where the findings of fact of the CA are
contrary to the findings and conclusions of the trial
court,[42] or when the same is unsupported by the
evidence on record.[43] There is no ground to apply the
exception in the instant case, however, because the
findings and conclusions of the CA are in full accord with
those of the trial court.
The forged Deed of Absolute Sale is null and conveys no
title.
Having affirmed the findings of fact of both the CA and
the trial court that the signatures of Julian and Guillerma
are forgeries, we now come to the question of the
validity of the transfer of title to the petitioners.
In Sps. Solivel v. Judge Francisco,[44] we held that:
x x x in order that the holder of a certificate for value
issued by virtue of the registration of a voluntary
instrument may be considered a holder in good faith for
value, the instrument registered should not be
forged. When the instrument presented is forged, even if
accompanied by the owners duplicate certificate of title,
the registered owner does not thereby lose his title, and
neither does the assignee in the forged deed acquire any
right or title to the property.
x x x The innocent purchaser for value protected by law
is one who purchases a titled land by virtue of a
deed executed by the registered owner himself, not by a
forged deed, as the law expressly states. x x x
In Instrade, Inc. v. Court of Appeals,[45] we reiterated the
said ruling maintaining that [A]s early as Joaquin v.
Madrid, x x x, we said that in order that the holder of a
certificate for value issued by virtue of the registration of
a voluntary instrument may be considered a holder in
good faith and for value, the instrument registered
should not be forged. Indubitably, therefore, the
questioned Deed of Absolute Sale did not convey any
title to herein petitioners. Consequently, they cannot
take refuge in the protection accorded by
the Torrens system on titled lands.
Thus, we hold that with the presentation of the forged
deed, even if accompanied by the owners duplicate
certificate of title, the registered owner did not thereby
lose his title, and neither does the assignee in the forged
deed acquire any right or title to the said property. The
CA has aptly arrived at the same conclusion in its August
20, 2003 Decision affirming in toto the August 2,
2001 Decision of the RTC of Cagayan de Oro City
ratiocinating that:
It is significant to stress that the main thrust in the case
at bench is the regularity and validity of the
assailed Deed of Absolute Sale dated December 7, 1970
(Record p. 374, Exhibit 3) allegedly executed by JULIAN in
favor of the appellants. As such, we must not confuse
the issue at hand by averring that other documents
should be considered in determining the validity of the
deed of absolute sale. The reason is simple: the valid
execution of the Deed of Absolute Sale will convey and
transfer ownership in favor of appellants title based on
the rule that by the contract of sale one of the
contracting parties obligates himself to transfer
ownership of and to deliver a determinate thing, and the
other to pay therefor a sum certain in money or its
equivalent (Coronel vs. Court of Appeals, 263 SCRA
15). The fact that the assailed Deed was not signed by
JULIAN and the signatures of JULIAN and GUILLERMA
were forged per findings of the NBI Senior Document
Examiner, it can therefore be inferred that the
subsequent issuance of Transfer Certificate of Title No. T-
14204 has no basis at all since ownership was not
conveyed to appellants by reason of the forged Deed.
In addition, as to the issue that
the Agreement dated December 10, 1970 (Record p.
375, Exhibit 4) executed between DOMINGO and
PATRICIO were excluded, we believe there is no need to
delve on the said Agreement since the same will not in
any way give justification to the forgery committed in
the Deed of Absolute Sale. As explained by the court a
quo, to which we concur, appellees should not be
faulted because they are not lawyers, and as such they
may not be able to appreciate the legal logic between
Exhibits 3 and 4.[46]
Prescription did not bar respondents action to recover
ownership of the subject property.
Citing Article 1454[47] of the Civil Code, petitioners assert
that since the respondents admit that there was a
mortgage transaction between Julian and herein
petitioners involving the subject property there is no
dispute that an implied trust was created by operation of
law. In which case, respondents right to reconveyance
had already prescribed when they filed the annulment
case on April 3, 1992, or more than 10 years after
petitioners repudiated such implied trust.
On the other hand, respondents assert that the element
of consent is totally wanting in the assailed Deed of
Absolute Sale because the signatures of Julian and
Guillerma, which is equivalent to their consent, were
forged by the petitioners.[48] They maintain that the
absence of consent made the said document null and
void.[49] Hence, this case falls under the purview of Article
1410 of the Civil Code which provides that an action to
declare the inexistence of void contracts does not
prescribe.[50]
We agree with the respondents. The supposed vendor's
signature having been proved to be a forgery, the
instrument is totally void or inexistent as "absolutely
simulated or fictitious" under Article 1409 of the Civil
Code.[51] According to Article 1410, "the action or
defense for the declaration of the inexistence of a
contract does not prescribe. The inexistence of a
contract is permanent and incurable which cannot be
cured either by ratification or by prescription.[52]
The award of moral damages and attorneys fees is
proper.
On this aspect, we must consider the blood relations
among the parties. One of the respondents, Emma S.
Felicilda, testified on cross examination that they had
high regard for Myrna, their eldest sister.[53] The same
was echoed by respondent Anita Sambaan on cross
examination.[54] They could not believe that Myrna
would keep and appropriate the land for herself and
transfer the title exclusively to her name.[55] On direct
examination, respondent Emma S. Felicilda likewise
testified that the forgery caused them anger and bad
emotions.[56]
Moreover, it was Julians dying wish for the property to
be redeemed from the petitioners.[57] Hence, it is not
unexpected that the sentimental significance of the
property and the anger and emotions caused by the
unlawful transfer of the same have moved the
respondents to recover the same through the instant
action. We therefore hold that the award of P20,000.00
as moral damages is proper.

In addition, in view of the complexity of the instant case

and the multiple levels of appeal that this case had gone
through, we also affirm the award of attorneys fees
of P20,000.00 as well as the actual damages of P1,671.00
incurred by the prevailing party which was substantiated
during trial.

On a final note, it bears stressing that the arguments

raised by the petitioners are essentially the same issues
they put forward before the CA which have been duly
passed upon and considered by the appellate court in
affirming the RTC Decision in toto.

WHEREFORE, the petition is DENIED.

SO ORDERED.
LUMINZA DELOS REYES, A.M. No. RTJ-08-2152
Complainant, (Formerly A.M. OCA IPI In her letter-complaint dated March 13, 2008,
No. 08-2846-RTJ) complainant alleged that she is the defendant in LRC
Case No. R-5740 pending before Branch 152 of
Present: the Regional Trial Court of Pasig City. She claimed that
- versus - on March 25, 2004, Judge Cruz issued an Order giving
CARPIO, J., Chairperson, the parties 15 days within which to file their respective
DE CASTRO,* memorandum after which the case would be deemed
JUDGE DANILO S. CRUZ BRION, submitted for decision. The parties complied; hence,
and on April 9, 2004 the case was deemed submitted for
and CLERK OF COURT V DEL CASTILLO, and decision.
GODOLFO R. GUNDRAN, ABAD, JJ.
of the Regional Trial However, it was only on July 30, 2007, or more than
Court, three years since the case was submitted for resolution,
Branch 152, Pasig City, Promulgated: that a decision in the said case was
Respondents. January 18, 2010 rendered. Consequently, complainant argued that Judge
x--------------------------------------------- Cruz incurred delay in disposing the case thus should be
----------------------x held administratively liable therefor.

Complainant also alleged that after receipt of the

DECISION
DEL CASTILLO, J.:
Courts exist to administer justice fairly and without
delay. Our overriding concern is to eradicate the
impression formed in the minds of the litigants that the
wheels of justice grind ever so slowly. We have always
reminded the judges to dispose of the cases within the
prescribed period of time because we do not want the
truism - justice delayed is justice denied - to lose its
meaning or relevance. In the same context, we have
constantly exhorted all court employees to be
conscientious of their duties and responsibilities
considering that any indiscretion or transgression on
their part would impact negatively on the Court as an
institution.
The instant administrative case stemmed from a letter-
complaint filed by complainant Luminza Delos Reyes
(Delos Reyes) against respondents Judge Danilo S.
Cruz (Judge Cruz) and Clerk of Court V Godolfo R.
Gundran (Clerk of Court Gundran), both of the Regional
Trial Court of Pasig City, Branch 152, for dereliction of
duty. Specifically, Judge Cruz is charged with delay in the
disposition of LRC Case No. R-5740[1] while Clerk of Court
Gundran is charged with failure to timely transmit the
records of said case.
adverse decision, she timely filed on September 6,
2007 a notice of appeal and paid the corresponding
appeal and docket fees. However, despite the lapse of
more than six months from the time the appeal was
filed, respondent Clerk of Court Gundran still failed to
transmit the records to the appellate court in violation of
Section 10, Rule 41 of the Rules of Court.
On April 11, 2008, then Court Administrator Zenaida N.
Elepao required Judge Cruz and Clerk of Court Gundran
to file their respective comment on the complaint. Both
respondents complied.
In his Comment, Judge Cruz did not deny that he
incurred delay in the disposition of LRC Case No. R-
5740. Instead, he begged the indulgence of the Court
and claimed that he was indisposed since the latter part
of 2004. He narrated that in January 2005, he was
diagnosed of diabetes; on November 3, 2005, the
cataract on his left eye was removed while that on his
right eye was extracted on April 4, 2006; and on October
26-28, 2007, he was hospitalized due to heart
complications. Judge Cruz also explained that the delay
was partly due to heavy pressure of work.
On the other hand, Clerk of Court Gundran denied being
remiss in his duties. He claimed that in October 2007, he
already instructed the clerk-in-charge to complete the
records of the case and to prepare the transmittal
letter. Apparently, the clerk-in-charge encountered some
difficulty in completing the records. He signed the
transmittal letter on February 28, 2008 only to discover
that Judge Cruz has not yet issued an order giving due
course to the appeal. The records were eventually
transmitted on March 28, 2008, or on the same day the
order giving due course to the appeal was issued by
Judge Cruz. Clerk of Court Gundran also claimed that he
found it difficult to personally examine if the records
have been completed and transmitted on time due to
the heavy court docket and the numerous reports that
needed to be prepared and submitted. Finally, he
insisted that there was no deliberate intention to delay
the transmittal of the records or to cause damage to the
complainant.
In its Report and Recommendation dated October 13,
2008, the Office of the Court Administrator stated that:
EVALUATION: Evidently, there were two delays incurred
in this case. First is the delay in deciding the subject case
and the second is the delay in the transmittal of the
record of the case to the Court of Appeals.
The delay in deciding the case is attributable solely to
Judge Cruz. While we do not condone such delay, we are
inclined to consider in the instant matter his physical
condition the deterioration of which is supported by
several medical certificates and hospital records. He
even availed of the Health and Welfare Plan of the
Supreme Court.
The case of respondent Gundran, should, however, be
treated differently. As Branch Clerk, it is his duty to verify
the completeness of the records that will be transmitted
to the appellate court within thirty (30) days after
perfection of the appeal. He cannot transfer the blame
to his staff. Had he followed up his verbal instruction, if
there was any, he would not have incurred the delay.
xxxx
RECOMMENDATION: Respectfully submitted for the
consideration of the Honorable Court are our
recommendations that:
1. this case be RE-DOCKETED as a regular
administrative matter;
2. the charges against Judge Danilo S. Cruz
be DISMISSED with WARNING however that he should
be cautious in observing periods for rendition of
judgment; and
3. respondent Clerk of Court Godofredo
Gundran be SUSPENDED for one (1) month and one (1)
day for simple neglect of duty.
We find both respondents to be remiss in their duties.
As regards Judge Cruz, we find him grossly inefficient in
failing to decide LRC Case No. R-5740 within 90 days
from the time it was submitted for decision. He should
be mindful that failure to resolve cases submitted for
decision within the period fixed by law constitutes a
serious violation of the constitutional right of the parties
to the speedy disposition of their cases.[2]Article VIII,
Section 15(1) of the Constitution succinctly provides that:
SEC. 15. (1) All cases or matters filed after the effectivity
of this Constitution must be decided or resolved within
twenty-four months from date of submission for the
Supreme Court, and, unless reduced by the Supreme
Court, twelve months for all lower collegiate courts, and
three months for all other lower courts.
As such, lower courts are given a period of 90 days only
within which to decide or resolve a case from the time it
is submitted for decision.[3] In this case, it is undisputed
that LRC Case No. R-5740 was submitted for decision
on April 9, 2004 but the decision was rendered only
on July 30, 2007 or more than three years beyond the
90-day reglementary period.
The reasons proffered by Judge Cruz for incurring delay
in deciding the case within the prescribed period fail to
persuade us. He claims that his illness primarily caused
the delay in the disposition. However, it has not escaped
our attention that the case was submitted for decision as
early as April 2004 while Judge Cruz claimed to be
indisposed only towards the end of 2004.There was also
no showing that respondent judge was constantly ill
from the time the case was submitted for resolution in
April 2004 until the promulgation of the judgment in July
2007. He did not present any proof to show that he was
absent from work for a prolonged period of
time. Moreover, removal of cataract from both eyes
does not entail prolonged confinement. In fact, Judge
Cruz claimed that he was admitted to the hospital only
on October 26-28, 2007. At any rate, this confinement
occurred long after the rendition of the judgment in LRC
Case No. R-5740.
Besides, granting that his illness hindered the efficient
performance of his functions, all respondent judge had
to do was to request for an extension of time within
which to decide the case. Judge Cruz, however, made no
such request. In a similar case,[4] we held that:
Indeed, Judge Ubiadas illness could have adversely
affected the performance of his duties. Despite having
just been subjected to a triple by-pass operation, he
knew fully well that he still had to act as the judge of four
(4) RTC branches for two (2) months. If his illness had
indeed seriously hampered him in the discharge of his
duties, Judge Ubiadas could have requested this Court
for additional time to decide/resolve pending cases and
incidents. His illness cannot be an excuse for his failure to
render decisions or resolutions within the
constitutionally prescribed period, considering that he
could have requested an extension or other relief from
this Court but he did not. It is incumbent upon him to
dispose the cases assigned to him without undue delay.
This Court has incessantly admonished members of the
bench to administer justice without undue delay, for
justice delayed is justice denied. The present clogged
dockets in all levels of our judicial system cannot be
cleared unless every magistrate earnestly, painstakingly
and faithfully complies with the mandate of the
law. Undue delay in the disposition of cases amounts to
a denial of justice which, in turn, brings the courts into
disrepute and ultimately erodes the faith and confidence
of the public in the judiciary.[5]
We also find unacceptable Judge Cruzs justification that
the delay was partly due to heavy pressure of
work. Precisely, a judge is mandated to resolve cases
with dispatch. Section 5, Canon 6 of the New Code of
Judicial Conduct[6] categorically exhorts all judges to
perform all judicial duties, including the delivery of
reserved decisions, efficiently, fairly and with reasonable
promptness. In Report on the Judicial Audit Conducted in
the MTCC, Branch 2, Cagayan de Oro City,[7] we declared
that:
We are not unmindful of the burden of heavy caseloads
heaped on the shoulders of every trial judge. But that
cannot excuse them from doing their mandated duty to
resolve cases with diligence and dispatch. Judges
burdened with heavy caseloads should request the
Court for an extension of the reglementary period within
which to decide their cases if they think they cannot
comply with their judicial duty.Hence, under the
circumstances, all that said judge needed to do was
request for an extension of time since this Court has,
almost invariably, been considerate with regard to such
requests. x x x A heavy caseload may excuse a judges
failure to decide cases within the reglementary period
but not their failure to request an extension of time
within which to decide the case on time.
We have always extended a sympathetic attitude
towards judges. In fact, in recent years, we have exerted
efforts towards improving their condition. In return, we
expect them to likewise exert efforts towards improving
the image of the judiciary. It must be emphasized that
the honor and integrity of the judicial system is
measured not only by the fairness and correctness of
decisions rendered, but also by the expediency with
which disputes are resolved.[8] At this juncture, we
remind respondent judge that:
Delay in the disposition of cases not only deprives
litigants of their right to speedy disposition of their cases,
but also tarnishes the image of the
judiciary. Procrastination among members of the
judiciary in rendering decisions and taking appropriate
actions on the cases before them not only causes great
injustice to the parties involved but also invites suspicion
of ulterior motives on the part of the judge, in addition
to the fact that it erodes the faith and confidence of our
people in the judiciary, lowers its standards and brings it
into disrepute.[9]
As regards respondent Clerk of Court Gundran, we find
him guilty of simple neglect of duty for failure to timely
transmit the records of LRC Case No. R-5740. Section 10,
Rule 41 of the Rules of Court provides that:
SEC. 10. Duty of clerk of court of the lower court upon
perfection of appeal. Within thirty (30) days after
perfection of all the appeals in accordance with the
preceding section, it shall be the duty of the clerk of
court of the lower court:
(a) To verify the correctness of the original records or the
record on appeal, as the case may be, and to make a
certification of its correctness;
(b) To verify the completeness of the records that will be
transmitted to the appellate court;
(c) If found to be incomplete, to take such measures as
may be required to complete the records, availing of the
authority that he or the court may exercise for this
purpose; and
(d) To transmit the records to the appellate court.
If the efforts to complete the records fail, he shall
indicate in his letter of transmittal the exhibits or
transcripts not included in the records being transmitted
to the appellate court, the reasons for their non-
transmittal, and the steps taken or that could be taken to
have them available.
The clerk of court shall furnish the parties with copies of
his letter of transmittal of the records [to] the appellate
court.
Verily, the duty to verify the correctness and
completeness of the records of the case rests with the
respondent. However, in this case, respondent Clerk of
Court Gundran relegated the performance of his job to
another court employee without any justifiable
reason. We are likewise not persuaded by his contention
that the transmittal was delayed because the clerk-in-
charge to whom he assigned the job encountered some
difficulty in completing the records. Section 10, Rule 41
of the Rules of Court expressly provides that if the
records are found to be incomplete, measures should be
taken to complete the records. In his comment,
however, Clerk of Court Gundran made no mention of
any steps taken to complete the records. At any rate, the
failure to complete the records does not justify its non-
transmittal. Under the Rules, when the records cannot
be completed, respondent should indicate in his letter of
transmittal the exhibits or transcripts not included in the
records being transmitted to the appellate court, the
reasons for their non-transmittal, and the steps taken or
that could be taken to have them available.[10]Finally, it
has not escaped our notice that the records were
eventually transmitted only on March 28, 2008 or more
than six months after complainant filed her appeal, or
about two weeks after the instant administrative
complaint was filed.
We stress that clerks of court are essential judicial
officers who perform delicate administrative functions
vital to the prompt and proper administration of
justice. Their duty is, inter alia, to assist in the
management of the calendar of the court and in all
matters that do not involve discretion or judgment
properly belonging to the judge. They play a key role in
the complement of the court, as their office is the hub of
adjudicative and administrative orders, processes and
concerns. As such, they are required to be persons of
competence, honesty and probity, they cannot be
permitted to slacken on their jobs.[11]
Section 9, Rule 140 of the Rules of Court classifies undue
delay in rendering a decision or order as a less serious
charge punishable by either (a) suspension from office
without salary and other benefits for not less than one
nor more than three months; or (b) a fine of more
than P10,000.00 but not exceeding P20,000.00.[12] In the
instant case, there was undue delay of more than three
years before the decision in LRC Case No. R-5740 was
rendered. We therefore find the penalty of fine
of P11,000.00 as appropriate under the circumstances.
On the other hand, Section 22, Rule XIV of the Omnibus
Civil Service Rules and Regulations classifies simple
neglect of duty as a less grave offense punishable by
suspension of one month and one day to six months, if
committed for the first time, and by dismissal if
committed for the second time. As such, we find the
penalty of suspension of two months as appropriate
under the circumstances.
WHEREFORE, we find Judge Danilo S. Cruz of
the Regional Trial Court of Pasig City, Branch
152, GUILTY of undue delay in rendering a decision in
LRC Case No. R-5740 and is hereby FINED the amount
of P11,000.00. Likewise, Clerk of Court V Godolfo R.
Gundran of the same court is also GUILTY of simple
neglect of duty and is hereby meted the penalty of
suspension of two months without salary and
benefits. Both are STERNLY WARNED that a repetition of
the same or similar offense will be dealt with more
severely.
SO ORDERED.
 That on or about the month of July 1997, at Barangay x x
PEOPLE OF G.R. No. 178318 x, in the Municipality of Atimonan, Province of Quezon,
THE PHILIPPINES, Philippines and within the jurisdiction of this Honorable
Appellee, Court, the above-named accused, who is the uncle of the
offended party, with lewd design, by means of force,
Present: threats and intimidation, did then and there willfully,
unlawfully and feloniously have carnal knowledge of one
CARPIO, J., Chairperson, AAA, a minor, 12 years of age, against her will.
- versus - BRION,
DEL CASTILLO, Contrary to law.[2]
ABAD, and
PEREZ, JJ. The cases were docketed as Criminal Case Nos. 5746-G
& 5747-G and raffled to Branch 61 of the Regional Trial
EDGARDO ESTRADA, Promulgated: Court of Gumaca, Quezon. Appellant was arraigned
Appellant. ________________ on January 20, 1998, and pleaded not guilty. Trial on the
x--------------------------------------------- merits thereafter ensued.
----------------------x
The prosecution presented AAA as its first witness. She
testified that since she was about seven years old, she
DECISION lived in the house of her grandmother in Atimonan,
Quezon. Her mother was staying in Manila while her
father died when she was only an infant. Sometime in
DEL CASTILLO, J.: July 1997, she was sleeping side by side with her uncle,
herein appellant, when the latter suddenly placed his
knees between her thighs and proceeded to remove her
A bud plucked from the stalk clothes. Appellant who was already naked went on top
would never have its chance to blossom. of her and inserted his penis in her vagina. AAA tried to
A young plant prematurely clipped of its branches resist but appellant pinned her hands above her
would never develop and grow to its full and natural head. After having carnal knowledge of AAA, appellant
potential. told her not to report to anyone what had transpired or
Both would need care and attention to be able to recover she would be killed.
and mend. After the rape incident, AAA stayed at her grandfathers
In the ultimate end, however, what has been lost could house which was likewise located in the
never be regained or restored. same barangay where her grandmothers house was
situated. She thought that she would be safe
there. However, she was grievously mistaken. One
This is exactly what happened to AAA,[1] a barrio lass evening, also in the month of July 1997, appellant arrived
from Atimonan, Quezon, who was robbed of her thereat and again raped AAA. While the latter was
innocence not once but twice in July 1997. Worse, it was sleeping, appellant poked a knife at her and ordered her
her paternal uncle who perpetrated the lecherous acts to remove her clothes. AAA was cowed into submission
and precipitately initiated her to the ways of the and appellant succeeded in sexually assaulting her for
world. AAA was only 12-years old when defiled. the second time. AAAs grandfather who was sleeping
Factual Antecedents nearby did not even notice what was happening as the
latter was hard of hearing.
On November 19, 1997, two similarly-worded
Informations were filed against appellant Edgardo As proof that AAA was only 12 years old when the rape
Estrada charging him with two counts of Rape incidents transpired, she presented her Birth Certificate
committed as follows: showing that she was born on May 1, 1985.
On the other hand, appellant was 51 years old and
married. He admitted that AAA is his niece, the latter
being the daughter of his brother. However, he denied
raping AAA on two occasions.He claimed that he lived in
Poblacion, Atimonan, Quezon, which is approximately
seven kilometers away from where the victim lived. He
alleged that he never went to his parents houses;
instead, it was his mother who made occasional visits to
his house. He insisted that the charges were filed against
him because AAA resented his advice not to socialize
with boys because she was still young.
The other defense witness was Irene. She testified that
AAA is her granddaughter and that appellant is her
son. She narrated that although AAA used to live in her
house, she was not aware of any rape incident having
been committed thereat. She admitted though that she
loved her son more than she loved her granddaughter.
Ruling of the Regional Trial Court
On August 16, 2002, the trial court rendered its
Decision[3] finding appellant guilty of qualified rape on
two counts and sentenced him to suffer the supreme
penalty of death. The trial court found that the qualifying
circumstances of minority and relationship were both
satisfactorily established by the prosecution. The
dispositive portion of the Decision reads:
WHEREFORE, the Court finds the accused Edgardo
Estrada GUILTY beyond reasonable doubt of the crime of
RAPE on two (2) counts defined and punishable under
Article 335 of the Revised Penal Code as amended by
Republic Act 7659 and hereby sentences him to suffer
the penalty of DEATH for each rape and to indemnify the
complainant in the amount of P75,000.00 or a total
of P150,000.00; and to pay P50,000.00 or a total
of P100,000.00 as moral damages and the amount
of P30,000.00 or a total of P60,000.00 as exemplary
damages to deter others from committing the same
crime.
Costs against the accused.[4]
The trial court found that the prosecution satisfactorily
proved all the elements of rape. During the first rape, the
appellant employed violence against the person of the
victim by pinning her hands above her head. She was
likewise threatened with bodily harm in case she reports
what happened. During the second rape, he poked a
knife at her and succeeded in having carnal knowledge
of her.[5]
The qualifying circumstances of minority and
relationship were likewise appreciated by the trial
court. Based on the Birth Certificate presented by the
prosecution, it was established that the victim was a 12-
year old minor when she was ravished on two occasions
in July 1997. On the other hand, the trial court held that
the parties relationship with each other was established
by their testimonies. Appellant testified that AAA is his
niece while the latter admitted that appellant is her
uncle.
The trial court was not persuaded by the defenses of
alibi and denial proffered by the appellant. It found the
same barren and undeserving of any credence vis--
vis AAAs categorical testimony. Thus:
Accuseds denial is also an intrinsically weak defense. To
merit credibility, it must be buttressed by strong
evidence of non-culpability x x x. The rule is that
affirmative testimony is stronger than a negative one,
especially when it comes from the mouth of a credible
witness x x x. It was keenly observed by the Court that
AAA was emotionally affected as she recalled the
harrowing experiences she suffered from her uncle as
she had to wipe the tears from time to time as she
testified. As between a categorical testimony which has
a ring of truth on one hand, and a bare denial on the
other, the former is generally held to prevail. x x x A
mere denial constitutes self-serving evidence which
cannot be accorded greater evidentiary weight than the
declaration of a credible witness who testifies on
affirmative matters. x x x As against positive
identification by the private complainant, mere denials
of the accused cannot overcome conviction by the trial
court. x x x[6]
Appellants contention that AAA filed the charges against
him because she did not take kindly to his advice not to
associate with boys was briskly set aside by the court a
quo. It found the same too lame a reason to charge one
with a capital crime. Likewise, the court brushed aside
Irenes corroborative account for being incredible and
partial. The trial court found it inconceivable and not in
accord with the traditional Filipino values and norms that
a son would not visit his parents for years
notwithstanding the fact that they lived only seven
kilometers apart and the distance could easily be
traversed by automobiles.
On appeal, appellant insisted that the trial court erred in
convicting him because his guilt was not proven beyond
reasonable doubt. He insisted that his conviction could
not be based solely on the testimony of AAA.
Ruling of the Court of Appeals
On January 31, 2007, the Court of Appeals rendered its
Decision[7] affirming
with modifications the Decision of the trial court. Just like
the trial court, the appellate court found the victims tale
of defloration simple, candid, straightforward and
unflawed by any material or significant inconsistency
thus deserving of full faith and credit.[8] The Court of
Appeals noted that AAAs account contained details of
the sexual assaults only a real victim could remember
and reveal, and narrated them in a manner only one
who had undergone them could do.[9] Moreover, the
victims testimony was corroborated by the medical
findings that she suffered hymenal lacerations.[10]
The Court of Appeals completely brushed aside
appellants imputation of ill-motives on the part of the
victim. It found as too flimsy a reason that AAA resented
her uncles advice not to have any romantic interests
motivating her to fabricate the rape charges against
him.[11] It also gave short shrift to appellants denial and
alibi. Appellants denial was disregarded in view of the
victims positive identification of him as the perpetrator
of the crimes. His alibi was likewise rejected because of
his failure to prove that it was impossible for him to be at
the scene of the crimes at the time they were
committed.
The Court of Appeals however deviated from the ruling
of the trial court when it held that appellant should be
held liable only for simple rape and not for qualified
rape, notwithstanding the minority of the victim and the
fact that her attacker was her uncle. The Court of
Appeals opined that mere allegation in the Information
that the appellant was the victims uncle would not
suffice to satisfy the special qualifying circumstance of
relationship. It must be categorically stated that
appellant is a relative within the 3rd civil degree by
consanguinity or affinity.[12]Consequently, the award of
civil indemnity was reduced to P50,000.00 for each
count of rape.
The dispositive portion of the Decision of the Court of
Appeals reads:
WHEREFORE, the assailed decision is AFFIRMED with
MODIFICATIONS as follows:
1. finding appellant guilty of two
counts of SIMPLE RAPE in Criminal Case Nos. 5746-G and
5747-G and sentencing him to suffer the penalty
of reclusion perpetua for each count; and
2. reducing the civil indemnity
awarded to the victim to P50,000.00 for each count of
rape.
No costs.
SO ORDERED.[13]
Hence this appeal.
On October 8, 2007, we notified the parties that they
may file their supplemental briefs if they so
desire.[14] However, both manifested that they are
adopting the allegations in their appellees/appellants
briefs and would thus no longer file their supplemental
briefs.[15]
Our Ruling
The appeal lacks merit.
Applying the guiding principles that a) an accusation for
rape is easy to make, difficult to prove and even more
difficult to disprove; b) in view of the intrinsic nature of
the crime, the testimony of the complainant must be
scrutinized with utmost caution; and c) the evidence of
the prosecution must stand on its own merits and
cannot draw strength from the weakness of the
evidence for the defense,[16] we affirm the Decision of
the Court of Appeals finding herein appellant guilty of
two counts of simple rape.
Factual findings of the trial court, especially when
affirmed by the Court of Appeals, deserve great weight
and respect.
Both the trial court and the Court of Appeals found the
testimony of the victim credible. According to the trial
court, she candidly, positively and categorically testified
as to her harrowing experiences.[17] Thus, it was
convinced that appellant indeed raped AAA.[18] It also
keenly observed that AAA was emotionally affected as
she recalled the harrowing experiences she suffered
from her uncle as she had to wipe the tears from time to
time as she testified.[19]
We scoured the records of the case and we find no
reason to deviate from the above findings. There is no
showing at all that the trial court overlooked,
misunderstood or misapplied facts or circumstances of
weight which would have affected the outcome of the
case.[20] We therefore defer and give highest respect to
the findings of the trial court because it is in the best
position to assess and determine the credibility of the
witnesses. Because of its vantage position, it can detect a
guilty blush, a slight hesitation, a fearful glance, and an
anguished cry.
In addition, the Court of Appeals adopted the findings of
the trial court on the credibility of the victim. Hence, the
more reason for us not to disturb the said findings. The
Court of Appeals held that:
Utilizing the same settled legal precepts, we have
ourselves meticulously scrutinized the victims testimony
and, like the trial court, found her tale of defloration
simple, candid, straightforward and unflawed by any
material or significant inconsistency thus deserving of full
faith and credit. Her account contains details of the
sexual assaults only a real victim could remember and
reveal, and narrated them in a manner only one who
had undergone them could do.
Indeed, a witness who testified in a categorical,
straightforward, spontaneous and frank manner and
remained consistent on cross-examination is a credible
witness. Moreover, the testimony of a rape victim,
especially one who is young and immature, deserves full
credit considering that no woman would concoct a story
of defloration, allow an examination of her private parts
and thereafter allow herself to be perverted in a public
trial if she was not motivated solely by the desire to have
the culprit apprehended and punished. More so when,
as in this case, the rape victim accuses a close relative of
having ravished her.Indeed, if the victim, who was only
twelve years old when she was raped, had the guile to
accuse her own uncle of rape and send him to jail it was
only because she was motivated by an honest desire to
have the crime against her punished.
The victims credibility is further buttressed by the
findings of Dr. Geronimo Ayala, who conducted a
physical examination on her on September 3, 1997 after
she had reported the rape incident to the authorities.His
medical findings revealed that the victim had (old)
lacerated wound, 7 oclock position on her genitalia and
her hymen was not intact.x x x[21]
Appellants denial crumbles under the weight of
complainants positive identification of him as the
perpetrator of the crimes.
The trial court and the Court of Appeals correctly
rebuffed appellants denial. The same is self-serving and
undeserving of any credence at all in view of the victims
categorical, positive and forthright identification of him
as the perpetrator of the crimes. Irenes testimony
likewise deserved to be rejected. She was a biased
witness having admitted that she loved her son more
than she loved her granddaughter. At any rate,
appellants denial is an inherently weak and negative
defense. It could not prevail over AAAs positive
identification. We also do not deign to dignify appellants
imputation of ill-motives to the victim. We still believe
that no woman would allow herself to be subjected to
the indignities of a rape trial if she is not in search of
truth and justice.
Appellants alibi deserves no consideration at all.
In order for the defense of alibi to prosper, two
requisites must concur: first, the appellant was at a
different place at the time the crime was committed,
and second, it was physically impossible for him to be at
the crime scene at the time of its commission. In this
case, appellant miserably failed to establish the fact that
it was physically impossible for him to be at the locus
criminis. By his own admission, the distance between his
place and that of his parents where the rape incidents
were committed is about seven kilometers only and
could easily be traversed by public transport.
Appellant is guilty only of two counts of simple rape.
The rape incidents were committed in July 1997 hence
the law applicable is Article 335 of the Revised Penal
Code as amended by Republic Act No. 7659[22] which
provides:
ART. 335. When and how rape is committed. Rape is
committed by having carnal knowledge of a woman
under any of the following circumstances.
1. By using force or intimidation;
2. When the woman is deprived of reason or
otherwise unconscious; and
3. When the woman is under twelve years of age
or is demented.
The crime shall be punished by reclusion perpetua.
xxxx
The death penalty shall also be imposed if the crime of
rape is committed with any of the following attendant
circumstances:
1. when the victim is under eighteen (18) years of
age and the offender is a parent, ascendant, step-parent,
guardian, relative by consanguinity or affinity within the
third civil degree, or the common-law spouse of the
parent of the victim.
xxxx
In the instant case, it was clearly established by the
prosecution that on two occasions in July 1997, the
victim was sexually abused by appellant through force
and intimidation, against her will and without her
consent. The qualifying circumstance of minority of the
victim was likewise proven by the presentation of the
latters Birth Certificate.
However, as regards the allegation in the Information
that appellant is an uncle of the victim, we agree with
the Court of Appeals that the same did not sufficiently
satisfy the requirements of Art. 335 of the Revised Penal
Code, i.e., it must be succinctly stated that appellant is a
relative within the 3rd civil degree by consanguinity or
affinity. It is immaterial that appellant admitted that the
victim is his niece. In the same manner, it is irrelevant
that AAA testified that appellant is her uncle. We held
in People v. Velasquez:[23]
However, the trial court erred in imposing the death
penalty on accused-appellant, applying Section 11 of
Republic Act No. 7659. We have consistently held that
the circumstances under the amendatory provisions of
Section 11 of R.A. No. 7659, the attendance of which
could mandate the imposition of the single indivisible
penalty of death, are in the nature of qualifying
circumstances which cannot be proved as such unless
alleged in the information. Even in cases where such
circumstances are proved, the death penalty cannot be
imposed where the information failed to allege them. To
impose the death penalty on the basis of a qualifying
circumstance which has not been alleged in the
information would violate the accuseds constitutional
and statutory right to be informed of the nature and
cause of the accusation against him.
While the informations in this case alleged that accused-
appellant is the uncle of the two victims, they did not
state that he is their relative within the third civil degree
of consanguinity or affinity. The testimonial evidence
that accused-appellants wife and Luisa de Guzman are
sisters is immaterial. The circumstance that accused-
appellant is a relative of the victims by consanguinity or
affinity within the third civil degree must be alleged in
the information. In the case at bar, the allegation that
accused-appellant is the uncle of private complainants
was not sufficient to satisfy the special qualifying
circumstance of relationship. It was necessary to
specifically allege that such relationship was within the
third civil degree. Hence, accused-appellant can only be
convicted of simple rape on two counts, for which the
penalty imposed is reclusion perpetua in each case.
In view of the foregoing, the Court of Appeals was
correct in finding appellant guilty only of two counts of
simple rape and in sentencing him to suffer the penalty
of reclusion perpetua for each count, and in ordering him
to pay P50,000.00 as civil indemnity, P50,000.00 as
moral damages and P30,000.00 as exemplary damages
for each count of rape.[24]

WHEREFORE, the Decision of the Court of Appeals

dated January 31, 2007 in CA-G.R. CR-H.C. No. 00254
is AFFIRMED.

SO ORDERED.
PEOPLE OF G.R. No. 175319
THE PHILIPPINES,
Appellee,
Present:
CARPIO, J., Chairperson,
- versus - BRION,
DEL CASTILLO,
ABAD, and
PEREZ, JJ.
JOSELITO NOQUE y Promulgated:
GOMEZ,
Appellant. January 15, 2010
x---------------------------------------------
-----------------------------x
DECISION
DEL CASTILLO, J.:
The illicit trade and use of dangerous drugs destroys the
moral fiber of society. It has eroded and disrupted family
life, increased the transmission of sexually related
diseases, resulted in permanent and fatal damage to the
physical and mental health, and wasted dreams,
opportunities and hopes for a better future. As an ardent
sentinel of the peoples rights and welfare, this Court
shall not hesitate to dispense justice on people who
engage in such an activity.[1] The commitment to this end
is exemplified in this appeal.
The Charges
The appeal stems from two Informations filed before the
Regional Trial Court (RTC) of Manila, which were
subsequently docketed as Criminal Case Nos. 01-189458
and 01-189459, and raffled to Branch 35 of said
court. The Information in Criminal Case No. 01-189458
charging appellant Joselito Noque y Gomez with
violation of Section 15, Article III in relation to Section 21
(e), (f), (m), (o), Article 1 of Republic Act (RA) No. 6425, as
amended by Presidential Decree (PD) No. 1683 and as
further amended by RA 7659 reads:
That on or about January 30, 2001, in the City of Manila,
Philippines, the said accused, not having been authorized
by law to sell, dispense, deliver, transport or distribute
any regulated drug, did then and there willfully,
unlawfully and knowingly sell or offer for sale, dispense,
deliver, transport or distribute 2.779 (two point seven
seven nine grams) and 2.729 (two point seven two nine
grams) of white crystalline substance known as shabu
containing methamphetamine hydrochloride, which is a
regulated drug.
Contrary to law.[2]
On the other hand, the Information in Criminal Case No.
01-189459 contains the following accusatory allegations
for violation of Section 16, Article III in relation to Section
2 (e-2) Article I of RA 6425 as amended by Batas
Pambansa (BP) Bilang 179 and as further amended by
RA 7659:
That on or about January 30, 2001, in the City of Manila,
Philippines, the said accused without being authorized
by law to possess or use any regulated drug, did then
and there willfully, unlawfully and knowingly have in his
possession and under his custody and control (six seven
nine point two one five grams) 679.215 grams of white
crystalline substance known as shabu containing
methamphetamine hydrochloride, a regulated drug,
without the corresponding license or prescription
thereof.
Contrary to law.[3]
During his arraignment on July 23, 2001, appellant
pleaded not guilty to both charges. Pre-trial conference
was conducted and upon its termination a joint trial
ensued.
Version of the Prosecution
At 9 oclock in the evening of January 30, 2001, a
confidential informant of
Senior Police Officer 4 (SPO4) Norberto Murillo, went to
Police Station No. 4 of the Western Police District (WPD)
to tip off on the drug trafficking activities of the appellant
in Malate, Manila. SP04 Murillo immediately directed
Police Officers (POs) Christian Balais (Balais) and Dionisio
Borca (Borca) to conduct surveillance in the area
mentioned by the informant. The surveillance confirmed
appellants illegal operations being conducted at No. 630
San Andres Street, Malate, Manila. Thereafter, SP04
Murillo formed and led a buy-bust team with POs Balais,
Borca, Ramon Pablo, Roberto Godoy, Edgardo Book,
Bernard Mino, Rodante Bollotano, and Melchor Barolo
as members. PO1 Balais was designated as poseur-buyer
and was provided with 10 pieces of 100 peso bills as buy-
bust money.
The buy-bust team, together with the informant,
proceeded to the aforementioned address and upon
arrival thereat, positioned themselves outside the
appellants house. PO1 Balais and the informant
thereafter called out the appellant, who welcomed the
two and brought them to his bedroom. The informant
asked the appellant if he had P1,000.00 worth of
methamphetamine hydrochloride or shabu then pointed
to PO1 Balais as the actual buyer. When PO1 Balais
handed the marked money to the appellant, the latter
brought out from under a table a pranela bag from
which he took two plastic sachets containing white
crystalline granules suspected to be shabu. The
informant slipped out of the house as the pre-arranged
signal to the buy-bust team that the sale had been
consummated.
After seeing the informant leave, the team entered
appellants house. SPO4 Murillo frisked the appellant and
recovered the buy-bust money. He also confiscated
the pranela bag that contained a large quantity of
crystalline granules suspected to be shabu. The two
persons who were in a pot session with the appellant at
the time of the raid were likewise arrested and brought
to the WPD Station No. 9 for investigation.
The seized articles were taken to the police station and
submitted to the crime laboratory for examination to
determine the chemical composition of the crystalline
substance. Police Inspector (P/Insp.) and Forensic
Chemical Officer Miladenia Tapan examined one self-
sealing transparent plastic bag with markings JNG
containing 679.215 grams of white crystalline granules;
and two heat-sealed transparent plastic sachets each
containing white crystalline substance, pre-marked JNG-
1 weighing 2.779 grams and JNG-2weighing 2.729
grams. The qualitative examinations yielded positive
results for ephedrine, a regulated drug.
Version of the Defense
The appellant gave a different version of the events that
transpired. He testified that he was in his house in the
evening of January 23, 2001 when six policemen led by
SPO4 Murillo entered and arrested an unidentified
occupant of the room next to his. The arresting team
returned after 30 minutes and apprehended another
person. When they came back the third time, they took
him with them to WPD Station No. 9 where his wallet,
belt and shoes were taken. While under detention, SPO4
Murillo ordered him to admit selling illegal substances
but he refused. He was released on January 26,
2001 only to be rearrested at around 9 oclock in the
evening on January 30, 2001 when SPO4 Murillo and his
team returned to his house and took him at gunpoint to
the police station where he was detained for 24
hours. Police officers presented him later to Mayor Lito
Atienza and General Avelino Razon for a press
conference.
Ruling of the Regional Trial Court
In its Decision[4] dated February 28, 2003, the trial court
convicted the appellant of both charges. It declared that
the evidence adduced by the prosecution established
with moral certainty his guilt for committing the crimes
in the manner narrated in the Informations. The
testimonies of police officers that they caught appellant
in flagrante delicto of selling and possessing a dangerous
drug are clear and positive evidence that deserve more
evidentiary weight than appellants defenses of denial
and frame-up, which are mere negative and self-serving
assertions unsubstantiated by clear and convincing
evidence. The trial court also ruled that it cannot deviate
from the presumption of regularity in the performance
of duty on the part of the police officers since no ill
motives were ascribed to them that would entice them
to testify falsely against the appellant.
The trial court also held that while the Informations
alleged methamphetamine hydrochloride as the drug
seized from the appellant, the drug actually confiscated
which was ephedrine, is a precursor of
methamphetamine, i.e., methamphetamine is an
element of, and is present in ephedrine. Ephedrine is the
raw material while methamphetamine is its refined
product. Both drugs have the same chemical formula
except for the presence of a single atom of oxygen which
when removed by means of chemical reaction changes
ephedrine to methamphetamine. Thus, the trial court
ruled that the appellant can be convicted of the offenses
charged, which are included in the crimes proved. The
trial court further held that under Section 4, Rule 120 of
the Rules of Court, a variance in the offense charged in
the complaint or information and that proved shall result
in the conviction for the offense charged which is
included in the offense proved.
In determining the quantity of methamphetamine
hydrochloride upon which the proper imposable penalty
on the appellant must be based, the trial court gave
credence to the testimony of prosecution witness,
P/Insp. Tapan that a gram of ephedrine would produce
gram of methamphetamine when refined.[5]
Conformably, the methamphetamine contents of 5.508
grams[6] of ephedrine in Criminal Case No. 01-189458
would be 2.754 grams. Moreover, the
methamphetamine contents of 679.215 grams of
ephedrine in Criminal Case No. 01-189459 would be
339.6075 grams.
The dispositive portion of the Decision of the trial court
reads:
WHEREFORE, judgment is rendered:
In Criminal Case No. 01-189458, pronouncing accused
JOSELITO NOQUE y GOMEZ guilty beyond reasonable
doubt of selling a net quantity of 2.754 grams of
methamphetamine hydrochloride without authority of
law, penalized under Section 15 in relation to Section 20
of Republic Act No. 6425, as amended, and sentencing
the said accused to the indeterminate penalty ranging
from four (4) years and two (2) months of prision
correccional, as minimum, to six (6) years and one (1)
day of prision mayor, as maximum, and to pay the costs.
In Criminal Case No. 01-189459, pronouncing the same
accused JOSELITO NOQUE y GOMEZ guilty beyond
reasonable doubt of possession of a net quantity of
339.6075 grams of methamphetamine hydrochloride
without license or prescription, penalized under Section
16 in relation to Section 20 of Republic Act No. 6425, as
amended, and sentencing the said accused to the
penalty of reclusion perpetua and to pay a fine of
P5,000,000.00, plus the costs.
In the service of his sentences, the full time during which
the accused had been under preventive imprisonment
should be credited in his favor provided that he had
agreed voluntarily in writing to abide with the same
disciplinary rules imposed on convicted
prisoner. Otherwise, he should be credited with four-
fifths (4/5) only of the time he had been under
preventive imprisonment.
Exhibits B and C are ordered confiscated and forfeited in
favor of the government. Within ten (10) days following
the promulgation of this judgment, the Branch Clerk of
this Court, is ordered to turn over, under proper receipt,
the regulated drug involved in these cases to the
Philippine Drug Enforcement Agency (PDEA) for proper
disposal.
SO ORDERED.[7]
Ruling of the Court of Appeals
The CA affirmed the trial courts judgment. It held that
the designations in the Informations are for violations of
Sections 15 and 16 of RA 6425 that define and penalize
the crimes of illegal sale and illegal possession of
regulated drugs. While the allegations in the
Informations refer to unauthorized sale and possession
of shabu or methamphetamine hydrochloride, and not
of ephedrine, the allegations are however immediately
followed by the qualifying phrase which is a regulated
drug. Stated differently, the CA held that the
designations and allegations in the informations are for
the crimes of illegal sale and illegal possession of
regulated drugs. There being no dispute that ephedrine
is a regulated drug, pursuant to Board Resolution No. 2,
Series of 1988, issued by the Dangerous Drugs Board
on March 17, 1988, the CA ruled that the appellant is
deemed to have been sufficiently informed of the nature
of the crime with which he is accused. The fact that the
chemical structures of ephedrine and
methamphetamine are the same except for the
presence of an atom of oxygen in the former
strengthens this ruling.[8]
However, the CA modified the penalty imposed by the
trial court in Criminal Case No. 01-189458. It held that in
the absence of any mitigating or aggravating
circumstances in this case, the penalty should be
imposed in its medium period, ranging from six months
of arresto mayor, as minimum, to two years, four
months and one day of prision correccional, as
maximum. Thus, the dispositive portion of the Decision
of the CA reads:
WHEREFORE, premises considered, the February 28,
2003 Decision of the Regional Trial Court of Manila,
Branch 35, is hereby AFFIRMED with the MODIFICATION
that in Criminal Case No. 01-189458, accused-appellant
is hereby sentenced to suffer the indeterminate penalty
of six (6) months of arresto mayor, as minimum, to two
(2) years, four (4) months and one (1) day of prision
correccional, as maximum.
SO ORDERED.[9]
Our Ruling
The appeal is bereft of merit.
The prosecutions evidence satisfactorily proved that
appellant is guilty of illegal sale of a dangerous drug.
The prosecution successfully proved that appellant
violated Section 15, Article III of RA 6425. The
prosecutions evidence established the concurrence of
the elements of an illegal sale of a dangerous drug, to
wit: (1) the identity of the buyer and seller, object, and
consideration; and (2) the delivery of the thing sold and
the payment therefor.[10]
In the instant case, the police officers conducted a buy-
bust operation after receiving confirmed surveillance
reports that the appellant was engaged in the illicit sale
of dangerous drugs at No. 630 San Andres Street,
Malate, Manila. PO1 Balais, the designated poseur-buyer
of the buy-bust team, personally identified the appellant
as the person who volunteered to sell to him P1,000.00
worth of white crystalline substance alleged to
be shabu. The police officer received this illegal
merchandise after giving the appellant the marked
money as payment. Undoubtedly, the appellant is guilty
of selling a dangerous drug.
The prosecutions evidence satisfactorily proved that
appellant illegally possessed a dangerous drug.
The prosecution was also successful in proving that
appellant violated Section 16, Article III of RA 6425. It
adduced evidence that established the presence of the
elements of illegal possession of a dangerous drug. It
showed that (1) the appellant was in possession of an
item or an object identified to be a prohibited or
regulated drug, (2) such possession is not authorized by
law, and (3) the appellant was freely and consciously
aware of being in possession of the drug.[11]
The police buy-bust team apprehended the appellant for
the sale of a white crystalline substance then proceeded
to search the premises. They found a large quantity of
the same substance inside the bag that contained the
two sachets of the regulated drug sold to PO1
Balais. Appellant did not offer any explanation why he is
in custody of the said substance. Neither did the
appellant present any authorization to possess the
same. Mere possession of a regulated drug per
se constitutes prima facie evidence of knowledge
or animus possidendi sufficient to convict an accused
absent a satisfactory explanation of such possession
the onus probandi is shifted to the accused, to explain
the absence of knowledge or animus possidendi.[12] With
the burden of evidence shifted to the appellant, it was
his duty to explain his innocence on the regulated drug
seized from his person. However, as already mentioned,
he did not offer any excuse or explanation regarding his
possession thereof.
There is no evidence showing that the police officers are
actuated by ill motives.
Likewise to be considered against the appellant is his
failure to present evidence imputing evil motive on the
part of the police officers who participated in the
entrapment operation to testify falsely against
him. Where there is no evidence that the principal
witness of the prosecution was actuated by ill or devious
motive, the testimony is entitled to full faith and
credit.[13]
Appellants right to be informed of the nature and cause
of the accusations was not violated.
The only issue raised by the appellant in this petition is
that his conviction for the sale and possession of shabu,
despite the fact that what was established and proven
was the sale and possession of ephedrine, violated his
constitutional right to be informed of the nature and
cause of the accusations against him since the charges in
the Informations are for selling and possessing
methamphetamine hydrochloride.

We agree with the findings of the CA and the trial court,
as well as the testimony of the forensic chemical officer,
that the drug known as ephedrine has a central nervous
stimulating effect similar to that of
methamphetamine. In fact, ephedrine is an important
precursor used in the clandestine synthesis of
methamphetamine, which in crystallized form is
methamphetamine hydrochloride.
Thus, on March 17, 1988, pursuant to Section 20(8) of
RA 6425, as amended, the Dangerous Drugs Board in its
Board Regulation No. 2, S. 1988, classified as regulated
drug all raw materials of ephedrine, as well as
preparations containing the said drug. The chemical
formula of ephedrine is C10 H15 NO, whereas that of
methamphetamine is C10 H15 N. The only difference
between ephedrine and methamphetamine is the
presence of a single atom of oxygen in the former. The
removal of the oxygen in ephedrine will produce
methamphetamine. With ephedrine containing fifty
percent (50%) of methamphetamine hydrochloride if the
oxygen content in the former is removed, the nearly 680
grams of ephedrine seized from the appellant contains
about 340 grams of methamphetamine hydrochloride.
Moreover, as correctly observed by CA, the offenses
designated in the Informations are for violations of
Sections 15 and 16 of RA 6425, which define and
penalize the crimes of illegal sale and possession of
regulated drugs. The allegations in the Informations for
the unauthorized sale and possession of shabu or
methamphetamine hydrochloride are immediately
followed by the qualifying phrase which is a regulated
drug. Thus, it is clear that the designations and
allegations in the Informations are for the crimes of
illegal sale and illegal possession of regulated
drugs. Ephedrine has been classified as a regulated drug
by the Dangerous Drugs Board in Board Resolution No.
2, Series of 1988.
The CA correctly ruled that Sections 4 and 5, Rule 120 of
the Rules of Court,[14] can be applied by analogy in
convicting the appellant of the offenses charged, which
are included in the crimes proved. Under these
provisions, an offense charged is necessarily included in
the offense proved when the essential ingredients of the
former constitute or form part of those constituting the
latter. At any rate, a minor variance between the
information and the evidence does not alter the nature
of the offense, nor does it determine or qualify the crime
or penalty, so that even if a discrepancy exists, this
cannot be pleaded as a ground for acquittal.[15] In other
words, his right to be informed of the charges against
him has not been violated because where an accused is
charged with a specific crime, he is duly informed not
only of such specific crime but also of lesser crimes or
offenses included therein.[16]
The Penalties
In Criminal Case No. 01-189458, appellant is found
guilty of violation of Section 15, Article III of RA
6425, as amended. We explained in People
v. Isnani[17] that:
Under Section 15, Article III in relation to the second
paragraph of Sections 20 and 21 of Article IV of Republic
Act No. 6425, as amended by Section 17 of R.A. No.
7659, the imposable penalty of illegal sale of a regulated
drug (shabu), less than 200 grams, as in this case,
is prision correccional to reclusion perpetua. Based on
the quantity of the regulated drug subject of the offense,
the imposable penalty shall be as follows:
QUANTITY IMPOSABLE PENALTY
Less than one (1) gram
to 49.25 grams prision correccional
49.26 grams to 98.50 grams prision mayor
98.51 grams to 147.75 grams reclusion temporal
147.76 grams to 199 grams reclusion perpetua
The quantity of shabu involved is 0.060 grams. Pursuant
to the second paragraph of Sections 20 and 21 of Article
IV of R.A. No. 6425, as amended by Section 17 of R.A.
No. 7659 (for unauthorized sale of less than 200 grams
of shabu) and considering our ruling in the above case,
the imposable penalty is prision correccional.
Applying the Indeterminate Sentence Law, and there
being no aggravating or mitigating circumstance that
attended the commission of the crime, the maximum
period is prision correccional in its medium period which
has a duration of 2 years, 4 months and 1 day to 4 years
and 2 months. The minimum period is within the range
of the penalty next lower in degree which is arresto
mayor, the duration of which is 1 month and 1 day to 6
months. Hence, appellant should be sentenced to 6
months of arresto mayor, as minimum, to 2 years, 4
months and 1 days of prision correctional in its medium
period, as maximum.

In Criminal Case No. 01-189458, the quantity of the

prohibited drug seized from appellant is 2.754
grams. Accordingly, the Court of Appeals correctly
modified the penalty imposed by the trial court to six
months of arresto mayor, as minimum, to two
years, four months and one day of prision
correccional, as maximum.

As regards Criminal Case No. 01-189459, Section 16,

Article III of RA 6425, as amended, provides for the
penalty of reclusion perpetua to death and a fine ranging
from P500,000.00 to P10 million upon any person who
shall possess or use any regulated drug without the
corresponding license or prescription. Section 20 of RA
6425, as amended, further provides that the penalty
imposed for the offense under Section 16, Article III shall
be applied if the dangerous drug involved is 200 grams
or more of shabu. In this case, the appellant was found in
illegal possession of 339.6075 grams of prohibited
drug. Therefore, both the trial court and the Court of
Appeals correctly imposed the penalty of reclusion
perpetua and a fine of P500,000.00 to appellant.

WHEREFORE, the Decision of the Court of Appeals in CA-

G.R. CR-H.C. No. 00684 is AFFIRMED.

SO ORDERED.