RULE 18
pleading and practice, the answer ordinarily is the last
ALFONSO A. CHAN, petitioner, vs. THE HON. JUDGE
OTILLO G. ABAYA, as Presiding Judge of Branch 11,
Court of First Instance of Surigao del Sur, and
SOFRONIA AGAO respondents.
FACTS:
The petitioner, Alfonso A. Chan, filed a complaint against the
herein private respondent, Sofronia Agao, with the Court of
First Instance of Surigao del Sur, for indemnification, under
Articles 20 and 21 of the Civil Code of the Philippines, in
relation to Articles 2199, 2208 (par. 3), 2219 (par. 8) and 2229
thereof, for the damages suffered by him and his willful as a
result of the family and malicious prosecution of the petitioner
by the private respondent.
The private respondent filed her answer thereto, denying the
material allegations in the complaint, and interposed a
counterclaim for damages, attorney's fees, and costs, as well as
the payment of back rentals on a building which the petitioner
failed to pay despite demands.
Instead of filing a responsive pleading, the petitioner filed a
motion for a bill of particulars, asking for a more definite
statement on the alleged lease contract.
The respondent judge, however, did not take action on the
motion for a bill of particulars and set the pre-trial
conference of the case. Counsel for the petitioner asked
that the pre-trial conference be reset to another date until
his motion for a bill of particulars shall have been
resolved. But, the case was called for a pre-trial conference
as scheduled. Noting the absence of the petitioner and his
counsel, the attorney for the private respondent asked the court
that the petitioner be ordered to pay the private respondent her
expenses in coming to court. The respondent judge granted the
motion and issued an order directing the petitioner and/or his
counsel to pay damages suffered by the private respondent and
her counsel in the amount of P200.00, the same to be paid not
later than the next hearing of the case. The pretrial conference
was re-set.
ISSUE:
Whether the calling of a pre-trial conference was
premature since the respondent judge had not yet resolved
the petitioner's motion for a bill of particulars.
RULING:
Yes. To begin with, the calling of a pre-trial conference was
untimely.
As will be seen, the court is directed to hold the pre-trial of the
case after the last pleading has been filed. Construing the term
"last pleading," the Court held that "under the rules of
pleading, but when the defendant's answer contains a
counterclaim, plaintiff's answer to it is the last pleading."
Following the rule, the "last pleading" in the case would be the
answer of the plaintiff to the counterclaim of the defendant.
But, no answer to the counterclaim had been filed because of
the unresolved motion for a bill of particulars. Obviously, the
calling of a pre-trial conference was premature since there has
yet to be filed the "last pleading".
FILOIL MARKETING CORPORATION (now Petrophil
Corporation), plaintiff/appellee, vs. DY PAC & CO., INC.,
defendant/appellant.
FACTS:
An action for collection of a sum of money with interest was
commenced by plaintiff Filoil Marketing Corporation (now
Petrophil Corporation) in the City Court of Manila against
defendant Dy Pac & Co., Inc., alleging that, plaintiff had sold
and delivered on credit petroleum products to defendant, who
became indebted to it in the total amount of P 2,123.69; that
notwithstanding repeated demands, defendant refused to pay.
In its Answer with Counterclaim, defendant Dy Pac & Co.,
Inc., admitted the credit transactions alleged by plaintiff but
denied indebtedness, alleging lack of cause of action, payment
and prescription.
At the hearing set, neither defendant nor his counsel appeared;
plaintiff was allowed to present its evidence ex parte, and
accordingly, the City Court of Manila, rendered a decision on
the same date ordering defendant to pay plaintiff the sum of
P2, 123.69 plus 6% interest thereon.
Upon denial of its motion for reconsideration, defendant
appealed to the Court of First Instance of Manila. The lower
court immediately set the case for pre-trial.
In a subsequent Order, the trial court dismissed
defendant's appeal for failure of the parties to submit the
required stipulation of facts and ordered the immediate
return of the records to the City Court for execution.
ISSUE:
Whether the trial court erred in dismissing its appeal on the
ground that the parties failed to submit a stipulation of facts.
RULING:
Yes. There is no law which compulsorily requires litigants
to stipulate at pre-trial on the facts and issues that may
possibly crop up in a particular case, upon pain of
dismissal of such case. The process of securing admissions
whether of facts or evidence is essentially voluntary, since
1
stipulations of facts, like contracts, bind the parties thereto
who are not allowed to controvert statements made therein.
The trial court may, of course, advise and indeed urge the
parties during the pre-trial conference to try to arrive at a
stipulation of facts principally for their own convenience
and to simplify subsequent proceedings by identifying
those facts which are not really controverted and do not
need to be proved. Courts, however, cannot compel the
parties to enter into an agreement upon the facts. Where
the parties are unable to arrive at a stipulation of agreed
facts and do not reach an amicable settlement of their
controversy, the court must close the pre-trial proceedings
and go forward with the trial of the case.
ANDRES C. SARMIENTO, petitioner, vs. THE HON.
CELESTINO C. JUAN, PRESIDING JUDGE, BRANCH
X, COURT OF FIRST INSTANCE OF MANILA and
BELFAST SURETY & INSURANCE CO., INC.,
respondents.
FACTS:
A Civil Case was filed by private respondent Belfast Surety &
Insurance Co., Inc. against herein petitioner and his father
Benjamin R. Sarmiento, Sr. for indemnification under an
Indemnity Agreement executed by them in connection with a
bail bond.
After the petitioner filed an answer with compulsory
counterclaim, private respondent filed a motion to dismiss the
case against defendant Benjamin R. Sarmiento, Sr., and to
schedule the case for pre-trial. This motion was granted by
Judge Juan and the pre-trial was set.
At the said pre-trial, nobody appeared except Atty. Federico T.
Castillo, Jr., counsel for the private respondent. However, the
petitioner sent to the Court on the same date an urgent motion
for postponement stating therein that when he was preparing
to go to the Court, he felt severe stomach pain followed by
loose bowel movements, and he accordingly prayed that the
pre-trial be postponed to another date.
The urgent motion for postponement filed by the petitioner
was denied in the order of Judge Juan. On motion of Atty.
Castillo, the petitioner was "declared non-suited" (should have
been "as in default") and the private respondent allowed to
present its evidence ex-parte.
ISSUE:
Whether the pre-trial was premature inasmuch as, there
having been no answer filed by the private respondent to
the petitioner's counterclaim alleged in his answer, the
"last pleading" has not yet been filed so as to authorize a
pre-trial to be conducted in accordance with the Rules of
Court; there being no valid pre-trial, the trial court had no
authority to declare him as "non-suited", or more correctly, as
in default, for his failure to appear at the said pre-trial; (b)
assuming that there was a valid pre-trial, the trial court could
not legally declare the petitioner as in default due to his failure
to be present threat inasmuch as the private respondent itself
made no valid appearance at said pre-trial because only its
counsel appeared without any special authority to represent his
client at the said pre-trial; and (c) it was a grave abuse of
discretion on the part of the trial court to deny the petitioner's
urgent motion for postponement despite the merit of the
ground alleged therein, and the same thing is true with the
denial of his motion to set aside or lift the order declaring him
in default.
RULING:
No. The pre-trial was not prematurely scheduled on the
supposed ground that the last pleading had not been filed. The
requirement that the pre-trial shall be scheduled "after the last
pleading has been filed" is intended to fully appraise the court
and the parties of all the issues in the case before the pre-trial
is conducted. It must be remembered that the issues may only
be ascertained from the allegations contained in the pleadings
filed by the parties. The last permissible pleading that a party
may file would be the reply to the answer to the last pleading
of claim that had been filed in the case, which may either be
the complaint, a cross-claim, a counterclaim or a third party
complaint, etc. Any pleading asserting a claim must be
answered, and the failure to do so by the party against whom
the claim is asserted renders him liable to be declared in
default in respect of such claim. There are, however,
recognized exceptions to the rule, making the failure to answer
a pleading of claim as a ground for a default declaration, such
as the failure to answer a complaint in intervention, or a
compulsory counterclaim so intimately related to the
complaint such that to answer to same would merely require a
repetition of the allegations contained in the complaint.
In the case presently considered, the nature of the
counterclaim in the petitioner's answer has not been made
clear, except to categorize it as a compulsory counterclaim.
Such being the case, it is likely to be one where the answering
thereof is not necessary, and the failure to do so would not be
a ground to be declared in default. In any event, the private
respondent's failure to answer the petitioner's counterclaim
after the period to file the answer had lapsed is no obstacle to
holding a pre-trial. The requirement that the last pleading must
have been filed before a pre-trial may be scheduled should
more appropriately be construed to mean not only if the last
pleading had been actually filed, but also if the period for
filing the same had expired.
CITIBANK, N.A., petitioner, vs. HON. SEGUNDINO G.
CHUA, SANTIAGO M. KAPUNAN and LUIS L.
VICTOR, ASSOCIATE JUSTICES OF THE HON.
COURT OF APPEALS, THIRD DIVISION, MANILA,
HON. LEONARDO B. CANARES, Judge of Regional,
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Trial Court of Cebu, Branch 10, and SPOUSES
CRESENCIO AND ZENAIDA VELEZ, respondents.
FACTS:
Petitioner is a foreign commercial banking corporation duly
licensed to do business in the Philippines. Private respondents,
spouses Cresencio and Zenaida Velez, were good clients of
petitioner bank's branch in Cebu until March 14, 1986 when
they filed a complaint for specific performance and damages
against it in a Civil Case before the Regional Trial Court of
Cebu, Branch 10.
Private respondents alleged in their complaint that the
petitioner bank extended to them credit lines sufficiently
secured with real estate and chattel mortgages on equipment.
They claim that petitioner offered them special additional
accommodation of Five Million Pesos (P5, 000,000.00).
This arrangement started on September 4, 1985 until March
11, 1986, when private respondents tried to exchange with
petitioner bank six checks amounting to P3, 095,000.00 but
petitioner bank allegedly refused to continue with the
arrangement even after repeated demands. Instead, petitioner
bank suggested to private respondents that the total amount
covered by the "arrangement be restructured to thirty (30)
months with prevailing interest rate on the diminishing
balance". Private respondents agreed to such a proposal. Then
as a sign of good faith, they issued and delivered a check for
P75, 000.00 in favor of petitioner bank which was refused by
the latter demanding instead full payment of the entire
amount.
For the failure of petitioner bank to comply with this
restructuring agreement private respondents sued for specific
performance and damages.
Petitioner bank has a different version of the business
relationship that existed between it and private respondents.
Thus, starting sometime on September 4 of 1985, he (private
respondent Crescencio Velez) deposited his unfunded personal
checks with his current account with the petitioner. But prior
to depositing said checks, he would present his personal
checks to a bank officer asking the latter to have his personal
checks immediately credited as if it were a cash deposit and at
the same time assuring the bank officer that his personal
checks were fully funded. Having already gained the trust and
confidence of the officers of the bank because of his past
transactions, the bank's officer would always accommodate his
request. After his requests are granted which is done by way
of the bank officer affixing his signature on the personal
checks, private respondent Cresencio Velez would then
deposit his priorly approved personal checks to his current
account and at the same time withdraw sums of money from
said current account by way of petitioner bank's manager's
check. Private respondent would then deposit petitioner bank's
manager's check to his various current accounts in other
commercial banks to cover his previously deposited unfunded
personal checks with petitioner bank. Naturally, petitioner
bank and its officers never discovered that his personal check
deposits were unfunded. On the contrary, it gave the petitioner
bank the false impression that private respondent's
construction business was doing very well and that he was one
big client who could be trusted. This deceptive and criminal
scheme he did every banking day without fail from September
4, 1985 up to March 11, 1986. The amounts that he was
depositing and withdrawing during this period (September 4,
1985 to March 11, 1986) progressively became bigger. It
started at P46, 000.00 on September 4, 1985 and on March 11,
1986 the amount of deposit and withdrawal already reached
over P3, 000,000.00. At this point in time (March 11, 1986),
the private respondent Cresencio Velez presumably already
feeling that sooner or later he would be caught and that he
already wanted to cash in on his evil scheme, decided to run
away with petitioner's money. On March 11, 1986, he
deposited various unfunded personal checks totaling
P3,095,000.00 and requested a bank officer that the same be
credited as cash and after securing the approval of said bank
officer, deposited his various personal checks in the amount of
P3,095,000.00 with his current account and at the same time
withdrew the sum of P3,244,000.00 in the form of petitioner's
manager's check. Instead of using the proceeds of his
withdrawals to cover his unfunded personal checks, he ran
away with petitioner bank's money. Thus, private respondent
Cresencio Velez's personal checks deposited with petitioner
bank on March 11, 1986 in the total aggregate amount of P3,
095,000.00 bounced. The checks bounced after said personal
checks were made the substantial basis of his withdrawing the
sum of P3, 244,000.00 from his current account with
petitioner bank."
Subsequently, petitioner bank filed a criminal complaint
against private respondents for violation of Batas Pambansa
Blg. 22 (Bouncing Checks Law) and estafa (six counts) under
Article 315 par. 2(d) of the Revised Penal Code. The
investigating fiscal recommended the filing of information
against private respondents for violations of the mentioned
laws.
Petitioner bank submitted its answer to the complaint filed
by private respondents. In the Order, the case was set for
pre-trial and petitioner bank was directed to submit its
pre-trial brief at least 3 days before the pre-trial
conference.
On the date of the pre-trial conference, counsel for petitioner
bank appeared, presenting a special power of attorney
executed by Citibank officer Florencia Tarriela in favor of
petitioner bank's counsel, the J.P. Garcia & Associates, to
represent and bind petitioner bank at the pre-trial conference
of the case at bar.
In spite of this special power of attorney, counsel for
private respondents orally moved to declare petitioner
bank as in default on the ground that the special power of
3
attorney was not executed by the Board of Directors of
Citibank. Petitioner bank was then required to file a
written opposition to this oral motion to declare it as in
default. In said opposition petitioner bank attached
another special power of attorney made by William W.
Ferguson, Vice President and highest ranking officer of
Citibank, Philippines, constituting and appointing the J.P.
Garcia & Associates to represent and bind the BANK at
the pre-trial conference and/or trial of the case of
"Cresencio Velez, et al. vs. Citibank, N.A." In an Order,
respondent judge denied private respondents' oral motion to
declare petitioner bank as in default and set the continuation of
the pre-trial conference.
On the scheduled pre-trial conference, private respondents
reiterated, by way of asking for reconsideration, their oral
motion to declare petitioner bank as in default for its failure to
appear through an authorized agent and that the documents
presented are not in accordance with the requirements of the
law. Petitioner bank again filed on its opposition thereto.
Respondent judge issued an order declaring petitioner bank as
in default. This order, received by petitioner bank, cited the
following as reason for the declaration of default:
"Defendant-bank, although a foreign corporation, is
bound by Philippine laws when doing and conducting
business in the Philippines (Sec. 129, B.P. Blg. 68), and its
corporate powers could only be exercised by its Board of
Directors (Sec. 23, B.P. Blg. 68). The exercise by the Board
of Directors of such power could only be valid if it bears
the approval of the majority of the Board (Sec. 25, par. 2,
Corporation Code). The records does not show the
requisite document. The alleged authority (Special Power
of Attorney, Annex "A") executed by Mr. William W.
Ferguson in favor of the alleged Citibank employees,
assuming the same to be a delegable authority, to
represent the defendant in the pre-trial conference, made
no mention of J.P. Garcia & Associates as one of the
employees of the defendant.
It stands to reason therefore, that the defendant-bank has
no proper representation during the pre-trial conference
for purposes of the Rules of Court."
Petitioner bank then filed a petition for certiorari, prohibition
and mandamus with preliminary injunction and/or temporary
restraining order with the Court of Appeals. The Court of
Appeals dismissed the petition on the following grounds:
1. Petitioner admitted that it did not and could not present a
Board resolution from the bank's Board of Directors
appointing its counsel, Atty. Julius Z. Neri, as its attorney-in-
fact to represent and bind it during the pre-trial conference of
this case. This admission is contained on pages 12 and 13 of
the instant petition.
2. The "By-Laws" of petitioner which on its face authorizes
(sic) the appointment of an attorney-in-fact to represent it in
any litigation, has not been approved by the Securities and
Exchange Commission, as required by Section 46 of the
Corporation Code of the Philippines. Apparently, the "By-
Laws" in question was (sic) approved under the laws of the
United States, but there is no showing that the same was given
the required imprimatur by the Securities and Exchange
Commission. Since petitioner is a foreign corporation doing
business in the Philippines, it is bound by all laws, rules and
regulations applicable to domestic corporations (Sec. 129,
Corporation Code).
3. No special power of attorney was presented authorizing
petitioner's counsel of record, Atty. Julius Neri and/or J.P.
Garcia Associates, to appear for and in behalf of petitioner
during the pre-trial.
4. What petitioner exhibited to the court a quo was a general
power of attorney given to one William W. Ferguson who in
turn executed a power of attorney in favor of five (5) Citibank
employees to act as attorney-in-fact in Civil Case. Yet, during
the pre-trial not one of said employees appeared, except
counsel who is not even a bank employee.
Furthermore, even assuming the validity of the power of
attorney issued by petitioner in favor of Ferguson as well as
the power of attorney he issued to five (5) Citibank
employees, said power of attorney has not been shown to be a
Special Power of Attorney precisely intended not only to
represent the bank at the pre-trial of the case on a certain date
but also to enter into any compromise as required in Article
1878 of the Civil Code and Rules of Court.
Petitioner bank contends that no board resolution was
necessary for its legal counsel, Atty. Julius Z. Neri, or
Citibank employees to act as its attorney-in-fact in the case at
bar because petitioner bank's by-laws grant to its Executing
Officer and Secretary Pro-Tem the power to delegate to a
Citibank officer, in this case William W. Ferguson, the
authority to represent and defend the bank and its interests.
Furthermore, it contends that the Court of Appeals erred in
holding that the by-laws of petitioner bank cannot be given
effect because it did not have the imprimatur of the Securities
and Exchange Commission (SEC) as required by Section 46 of
the Corporation Code of the Philippines.
Private respondents refute both contentions. They assail the
authority of petitioner bank's legal counsel to appear at the
pre-trial conference on two grounds, namely: first, that the
authority did not come from the Board of Directors which has
the exclusive right to exercise corporate powers; and second,
that the authority granted to the Executing Officer in the by-
laws was ineffective because the same were not submitted to,
nor approved by, the SEC.
ISSUE:
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There are thus two issues in this case. First, whether a
resolution of the board of directors of a corporation is
always necessary for granting authority to an agent to
represent the corporation in court cases. And second,
whether the by-laws of the petitioner foreign corporation
which has previously been granted a license to do business in
the Philippines, are effective in this jurisdiction. If the by-laws
are valid and a board resolution is not necessary as petitioner
bank claims, then the declaration of default would have no
basis.
RULING:
No. It is clear that corporate powers may be directly conferred
upon corporate officers or agents by statute, the articles of
incorporation, the by-laws or by resolution or other act of the
board of directors. In addition, an officer who is not a director
may also appoint other agents when so authorized by the by-
laws or by the board of directors. Such are referred to as
express powers. There are also powers incidental to express
powers conferred. It is a fundamental principle in the law of
agency that every delegation of authority, whether general or
special, carries with it, unless the contrary be expressed,
implied authority to do all of those acts, naturally and
ordinarily done in such cases, which are reasonably necessary
and proper to be done in order to carry into effect the main
authority conferred.
Since the by-laws are a source of authority for corporate
officers and agents of the corporation, a resolution of the
Board of Directors of Citibank appointing an attorney in
fact to represent and bind it during the pre-trial
conference of the case at bar is not necessary because its
by-laws allow its officers, the Executing Officer and the
Secretary Pro-Tem, ** to execute a power of attorney to a
designated bank officer, William W. Ferguson in this case,
clothing him with authority to direct and manage
corporate affairs.
This brings us to the second query: whether petitioner bank's
by-laws, which constitute the basis for Ferguson's special
power of attorney in favor of petitioner bank's legal counsel
are effective, considering that petitioner bank has been
previously granted a license to do business in the
Philippines.
Yes. Since the SEC will grant a license only when the foreign
corporation has complied with all the requirements of law, it
follows that when it decides to issue such license, it is satisfied
that the applicant's by-laws, among the other documents, meet
the legal requirements. This, in effect, is an approval of the
foreign corporations by-laws. It may not have been made in
express terms, still it is clearly an approval. Therefore,
petitioner bank's by-laws, though originating from a foreign
jurisdiction, are valid and effective in the Philippines.
In pursuance of the authority granted to him by petitioner
bank's by-laws, its Executing Officer appointed William W.
Ferguson, a resident of the Philippines, as its Attorney-in-Fact
empowering the latter, among other things, to represent
petitioner bank in court cases. In turn, William W. Ferguson
executed a power of attorney in favor of J.P. Garcia &
Associates (petitioner bank's counsel) to represent petitioner
bank in the pre-trial conference before the lower court. This
act of delegation is explicity authorized by paragraph XXI of
his own appointment, which we have previously cited.
It is also error for the Court of Appeals to insist that the
special power of attorney, presented by petitioner bank
authorizing its counsel, Atty. Julius Neri and/or J.P. Garcia &
Associates, to appear for and in behalf of petitioner bank
during the pre-trial, is not valid.
Finding that the authority of William W. Ferguson to delegate
his authority to act for and in behalf of the bank in any civil
suit is limited to individuals who are employees of the bank
the petitioner again on May 23, 1990 presented another special
power of attorney dated May 16, 1990 wherein William W.
Ferguson appointed as attorney-in-fact the following
employees of petitioner, namely: Roberto Reyes, Nemesio
Solomon, Aimee Yu and Tomas Yap. The said special power
of attorney was filed and presented by the petitioner through
its Manifestation filed in the Trial Court on May 23, 1990."
Under the Rules of Court, an attorney has authority to bind his
client in any case by an agreement in relation thereto made in
writing, and this authority would include taking appeals and
all matters of ordinary judicial procedure. But he cannot,
without special authority, compromise his client's litigation or
receive anything in discharge of a client's claim but the full
amount in cash. The special powers of attorney separately
executed by Florencia Tarriela and William W. Ferguson
granted to J.P. Garcia & Associates are very explicit in their
terms as to the counsel's authority in the case at bar.
It is also error on the part of the Court of Appeals to state that
the power of attorney given to the four (4) Citibank employees
is not a special power of attorney as required in paragraph 3,
Article 1878 of the Civil Code and Section 1 (a), Rule 20 of
the Rules of Court. In the case of Tropical Homes, Inc. vs.
Villaluz, the special power of attorney executed by petitioner
bank therein contained the following pertinent terms — "to
appear for and in its behalf in the above-entitled case in all
circumstances where its appearance is required and to bind it
in all said instances".
In fact, there was no need for the third power of attorney
because we believe that the second power of attorney was
sufficient under the by-law provision authorizing Fersugon to
delegate any of his functions to any one or more employees of
the petitioner bank. A reasonable interpretation of this
provision would include an appointment of a legal counsel to
represent the bank in court, for, under the circumstances, such
legal counsel can be considered, and in fact was considered by
the petitioner bank, an employee for a special purpose.
Furthermore, Fersugon, who heads the Philippine office
thousands of miles away from its main office in the United
5
States, must be understood to have sufficient powers to act
promptly in order to protect the interests of his principal.
Considering further that petitioner bank has a meritorious
defense and that the amount in contest is substantial, the
litigants should be allowed to settle their claims on the arena
of the court based on a trial on the merits rather than on mere
technicalities.
RULE 19
LUISA LYON NUÑAL, herein represented by ALBERT
NUÑAL, and ANITA NUÑAL HORMIGOS, petitioners,
vs. THE COURT OF APPEALS and EMMA LYON DE
LEON in her behalf and as guardian ad litem of the
minors HELEN SABARRE and KENNY SABARRE,
EDUARDO GUZMAN, MERCEDEZ LYON TAUPAN,
WILFREDO GUZMAN, MALLY LYON
ENCARNACION and DORA LYON DELAS PEÑAS,
respondents.
FACTS:
This case originated from a suit filed by Emma Lyon de Leon
in her behalf and as guardian ad litem of the minors Helen
Sabarre and Kenny Sabarre, Eduardo Guzman, Mercedes
Lyon Taupan, Wilfredo Guzman, Mally Lyon Encarnacion
and Dona Lyon de las Peñas, (herein private respondents)
against Luisa Lyon Nuñal, now deceased and herein
represented by her heirs, Albert Nuñal and Anita Nuñal
Hormigos (herein petitioners), for partition and accounting
of a parcel of land located in Isabela, Basilan City. Subject
parcel of land was formerly owned by Frank C. Lyon and May
Ekstrom Lyon, deceased parents of Helen, Dona, Luisa, Mary,
Frank and William James. Private respondents claimed that
said parcel of land, in the name of Frank C. Lyon, has been in
possession of petitioner Luisa Lyon Nuñal and that she made
no accounting of the income derived therefrom, despite
demands made by private respondents for the partition and
delivery of their shares.
The Court of First Instance (now Regional Trial court)
rendered its judgment in favor of private respondents and
ordered the partition of the property but dismissing private
respondents' complaint for accounting. An order for the
issuance of the writ of execution was issued by the court.
Mary Lyon Martin, daughter of the late Frank C. Lyon and
Mary Ekstrom Lyon, assisted by her counsel filed a motion to
quash the order of execution with preliminary injunction. In
her motion, she contends that not being a party to the above-
entitled case her rights, interests, ownership and participation
over the land should not be affected by a judgment in the said
case; that the order of execution is unenforceable insofar as
her share, right, ownership and participation is concerned, said
share not having been brought within the jurisdiction of the
court.
ISSUE:
Whether or not the trial court may order the inclusion of Mary
L. Martin as co-heir entitled to participate in the partition of
the property considering that she was neither a party plaintiff
nor a party defendant in Civil Case for partition and
accounting of the aforesaid property and that the decision
rendered in said case has long become final and executory.
RULING:
1. REMEDIAL LAW; CIVIL PROCEDURE; JUDGMENT;
ONCE IT BECOMES FINAL, MAY NO LONGER BE
MODIFIED IN ANY RESPECT; EXCEPTIONS. — In the
case of Manning International Corporation v. NLRC, (195
SCRA 155, 161 [1991]) We held that ". . ., nothing is more
settled in the law than that when a final judgment becomes
executory, it thereby becomes immutable and unalterable. The
judgment may no longer be modified in any respect, even if
the modification is meant to correct what is perceived to be an
erroneous conclusion of fact or law, and regardless of whether
the modification is attempted to be made by the Court
rendering it or by the highest Court of land. The only
recognized exceptions are the correction of clerical errors or
the making of so-called nunc pro tunc entries which cause no
prejudice to any party, and, of course, where the judgment is
void." Furthermore, "(a)ny amendment or alteration which
substantially affects a final and executory judgment is null and
void for lack of jurisdiction, including the entire proceedings
held for that purpose."
2. REMEDY OF AGGRIEVED PARTY. — In the case at bar,
the decision of the trial court in Civil Case No. 872 has
become final and executory. Thus, upon its finality, the trial
judge lost his jurisdiction over the case. Consequently, any
modification that he would make, as in this case, the inclusion
of Mary Lyon Martin would be in excess of his authority. The
remedy of Mary Lyon Martin is to file an independent suit
against the parties in Civil Case No. 872 and all other heirs for
her share in the subject property, in order that all the parties in
interest can prove their respective claims.
ROMEO J. ORDOÑEZ, Petitioner, vs. THE HON.
ALFREDO J. GUSTILO, in his capacity as presiding
judge of Regional Trial Court of Cavite, Branch XVI,
Cavite City, Municipality of Rosario, Cavite, former
Mayor Calixto D. Enriquez of Rosario, Cavite, and
Valeriano Espiritu of Mabolo, Bacoor, Cavite,
Respondents.
FACTS:
6
Valeriano Espiritu, herein private respondent filed a complaint
for Specific Performance and Damages, against respondents
Municipality of Rosario, Cavite and Calixto Enriquez, the
latter in his capacity as Mayor of said municipality, to enforce
their agreement contained in a Reclamation Contract. In his
complaint, Espiritu prayed that the Municipality of Rosario,
together with Enriquez, be ordered to convey to him 323,996
square meters of the reclaimed portion of the foreshore land of
the town. Espiritu filed the action in his capacity as the
assignee of the Salinas Development Corporation (SADECO),
the entity which reclaimed the area in question by virtue of a
Reclamation Contract entered into between it and the
Municipality of Rosario, represented by Enriquez as
Municipal Mayor.
In its answer, defendant municipality resisted plaintiff's claim
stating that it was barred by the statute of limitation; the
contract has been substantially amended, modified and
supplemented; and plaintiff has not performed his reciprocal
obligation.
The barangay captain of Tejeros Convention, Rosario,
Cavite, herein petitioner Romeo J. Ordoñez, together with
seven (7) other municipal and barangay officials
intervened, and in their Answer-in-Intervention, they
alleged that no actual reclamation was done by the
plaintiff and the area being claimed by the plaintiff came
about by natural accretion; the reclamation contract
between the contractor and the municipality is either void,
voidable or disadvantageous to the defendant municipality.
The issues having been joined the trial court set the case
for the mandatory pre-trial conference. In said conference,
plaintiff Espiritu and defendant municipality, manifested
to the court that having arrived at a satisfactory
settlement, they would submit a compromise agreement.
On the other hand, the intervenors asked the court that
they be allowed to present their evidence to prove their
defense asserted in their answer-in-intervention.
The principal litigants filed with respondent trial court
their promised compromise agreement. The parties agreed
that 208,664 square meters of the reclaimed area were to be
alloted to the plaintiff and 211,311 square meters thereof were
to be given to defendant municipality.
The trial court approved the compromise agreement and
rendered a decision in accordance therewith. The intervenors
received their copy of the decision. The decision being already
final, it was duly executed to the satisfaction of the principal
litigants.
The intervenors filed a motion to set aside the compromise
agreement. This was denied by the trial court and held that it is
settled that a judgment approving a compromise agreement is
final and immediately executory. Further trial in this case will
be an exercise in futility, considering that the issues raised by
the intervenors have become moot and academic in view of
the decision of the Court based on the Compromise
Agreement submitted by the plaintiff and the defendants.
ISSUE:
Whether or not the lower court erred in stopping/preventing
the intervenors from further presenting their evidence in
support of their Answer-in-Intervention.
RULING:
No. Intervention is defined as a "proceeding in a suit or
action by which a third person is permitted by the court to
make himself a party, either joining plaintiff in claiming
what is sought by the complaint, or uniting with defendant
in resisting the claims of plaintiff, or demanding something
adversely to both of them; the act or proceeding by which
a third person becomes a party in a suit pending between
others; the admission, by leave of court, of a person not an
original party to pending legal proceedings, by which such
person becomes a party thereto for the protection of some
right or interest alleged by him to be affected by such
proceedings." (Metropolitan Bank & Trust Co. v. the
Presiding Judge, RTC Manila, Branch 39, et al., G.R. No.
89909, September 21, 1990)
An intervention has been regarded as "merely collateral or
accessory or ancillary to the principal action and not an
independent proceeding; an interlocutory proceeding
dependent on or subsidiary to, the case between the original
parties." The main action having ceased to exist, there is no
pending proceeding whereon the intervention may be based.
There is no question that intervention is only collateral or
ancillary to the main action. Hence, it was previously ruled
that the final dismissal of the principal action results in the
dismissal of said ancillary action."
A judgment approving a compromise agreement is final and
immediately executory. All pending issues will become moot
and academic once a compromise submitted by the parties is
approved by the trial court.
In the case at bar, the compromise agreement submitted by the
plaintiff and the defendants and the decision approving the
same recognized the validity of the Reclamation Contract and
the fact that the tract of land involved was the result of the
reclamation done by SADECO. In their answer-in-
intervention, petitioner alleges that there was no reclamation
undertaken by SADECO, that the land in question was the
result of accretion from the sea and that the Reclamation
Contract is null and void. Clearly then, the compromise
agreement and the decision had in effect resolved the
aforementioned issues raised by the intervenors. As aptly
observed by the trial court, the continuation of the reception of
the intervenors' evidence would serve no purpose at all.
Should intervenors fail to prove that the Reclamation Contract
is null and void and that no actual reclamation was made, the
correctness and propriety of the decision based on the
compromise agreement would be strengthened. Upon the other
hand, should they succeed in proving that the contract is null
and void, and that the area in question came into being
through the natural action of the sea, still the decision of the
lower court could no longer be set aside, inasmuch as it has
already become final and executed.
7
METROPOLITAN BANK AND TRUST COMPANY,
petitioner, vs. THE PRESIDING JUDGE, REGIONAL
TRIAL COURT, Manila Branch 39, RAYCOR
AIRCONTROL SYSTEM, INC. and COURT OF
APPEALS, respondent.
FACTS:
Petitioner Metropolitan Bank and Trust Co. (Metropolitan) in
whose favor a deed of chattel mortgage was executed by Good
Earth Emporium, Inc. (GEE) over certain air conditioning
units installed in the GEE building, filed a complaint for
replevin against Uniwide Sales, Inc. (Uniwide, for brevity)
and the BPI Investment Corporation and several other banks
collectively called BPI-Consortium, for the recovery of the
possession of the air-conditioning units or in the event they
may not be recovered, for the defendants which acquired the
GEE building in an auction sale, (to) be required, jointly and
severally, to pay the plaintiff the unpaid obligations on the
units.
Plaintiff Metrobank alleged that the air-conditioning units
were installed on a loan of P4,900,000.00 it extended to Good
Earth Emporium & Supermarket, Inc. in its building located at
Rizal Avenue, Sta. Cruz, Manila, after the land and building
had been foreclosed and purchased at public auction by the
defendants, except Uniwide, and in order to secure repayment
of the loan, a deed of chattel mortgage was constituted over
the personal properties listed in the deed which included the
air-conditioning units.
The loan proceeds were used by GEE to finance the
acquisition of air-conditioning equipment from Reycor Air
Control System, Inc. under an Agreement of Sale.
Reycor Air Control Systems, Inc. filed a motion for leave
to intervene alleging it has a direct and immediate interest
on the subject matter of the litigation such that it will
either gain or lose by the direct legal operation and effect
of the judgment' and attached the 'Intervention
Complaint'.
Plaintiff Metrobank and defendants BPI Consortium filed a
joint motion to dismiss the complaint; the lower court issued
the order dismissing the complaint with prejudice.
Private respondent filed a motion for reconsideration of the
order dismissing the complaint with prejudice, claiming it was
not furnished with copy of the joint motion for dismissal. The
respondent court issued the order granting the motion for
reconsideration filed by the intervenor.
Private respondent filed a motion to admit amended
complaint. To this motion, plaintiff Metrobank filed an
opposition and after the intervenor had filed their Reply, the
respondent court issued the order admitting the amended
complaint in intervention.
Petitioner filed a petition for certiorari and mandamus
with respondent Court of Appeals contending that the
lower court committed a grave abuse of discretion
amounting to lack of jurisdiction in allowing the
intervention suit to survive despite the dismissal of the
main action and also in admitting the amended complaint
in intervention.
ISSUE:
Whether the Court of Appeals erred in allowing the
intervention suit to survive despite the dismissal of the main
action and also in admitting the amended complaint in
intervention.
RULING:
No. There is no final dismissal of the main case. The
aforementioned order of the lower court has the effect not only
of allowing the intervention suit to proceed but also of
vacating its previous order of dismissal. The reinstatement of
the case in order to try and determine the claims and
rights of the intervenor is proper. The joint motion of
therein plaintiff and the original defendants to dismiss the
case, without notice to and consent of the intervenor, has the
effect of putting to rest only the respective claims of the said
original parties inter se but the same cannot in any way affect
the claim of private respondent which was allowed by the
court to intervene without opposition from the original parties.
Intervention is defined as "a proceeding in a suit or action by
which a third person is permitted by the court to make himself
a party, either joining plaintiff in claiming what is sought by
the complaint, or uniting with defendant in resisting the claims
of plaintiff, or demanding something adversely to both of
them; the act or proceeding by which a third person becomes a
party in a suit pending between others; the admission, by leave
of court, of a person not an original party to pending legal
proceedings, by which such person becomes a party thereto
for the protection of some right of interest alleged by him to
be affected by such proceedings."
Any person who has or claims an interest in the matter in
litigation, in the success of either of the parties to an action, or
against both, may intervene in such action, and when he has
become a party thereto it is error for the court to dismiss the
action, including the intervention suit on the basis of an
agreement between the original parties to the action. Any
settlement made by the plaintiff and the defendant is
necessarily ineffective unless the intervenor is a party to it.
By the very definition of "intervention," the intervenor is a
party to the action as the original parties and to make his right
effectual he must necessarily have the same power as the
original parties, subject to the authority of the court reasonably
to control the proceedings in the case.
8
Having been permitted to become a party in order to better
protect his interests, an intervenor is entitled to have the issues
raised between him and the original parties tried and
determined. He had submitted himself and his cause of action
to the jurisdiction of the court and was entitled to relief as
though he were himself a party in the action.
After the intervenor has appeared in the action, the plaintiff
has no absolute right to put the intervenor out of court by the
dismissal of the action. The parties to the original suit have no
power to waive or otherwise annul the substantial rights of the
intervenor. When an intervening petition has been filed, a
plaintiff may not dismiss the action in any respect to the
prejudice of the intervenor.
It has even been held that the simple fact that the trial court
properly dismissed plaintiff s action does not require dismissal
of the action of the intervenor. An intervenor has the right to
claim the benefit of the original suit and to prosecute it to
judgment. The right cannot be defeated by dismissal of the suit
by the plaintiff after the filing of the petition and notice
thereof to the other parties. A person who has an interest in the
subject matter of the action has the right, on his own motion,
to intervene and become a party to the suit, and even after the
complaint has been dismissed, may proceed to have any actual
controversy established by the pleadings determined in such
action. The trial court's dismissal of plaintiffs action does not
require dismissal of the action of the intervenor.
The intervenor in a pending case is entitled to be heard like
any other party. A claim in intervention that seeks affirmative
relief prevents a plaintiff from taking a voluntary dismissal of
the main action. Where a complaint in intervention was filed
before plaintiff's action had been expressly dismissed, the
intervenor's complaint was not subject to dismissal on the
ground that no action was pending, since dismissal of
plaintiffs action did not affect the rights of the intervenor or
affect the dismissal of intervenor's complaint. An intervenor's
petition showing it to be entitled to affirmative relief will be
preserved and heard regardless of the disposition of the
principal action.
There is no question that intervention is only collateral or
ancillary to the main action. Hence, it was previously ruled
that the final dismissal of the principal action results in the
dismissal of said ancillary action. The main action having
ceased to exist, there is no pending proceeding whereon the
intervention may be based. In the case at bar, however, there
was no such final or complete dismissal but rather an approval
of a compromise agreement which was embodied in what was
specifically designated as a 'Partial Decision' affecting only
the interests of herein petitioner and the defendant in said case
but not those of her co-plaintiff municipality and the
intervenor. The clear intent of the court below in making the
partial decision is to make a reservation to determine the rights
of the intervenor and, presumably, the plaintiff municipality.
There may be nothing much left to be done with respect to the
main case but as far as the proceedings in the trial court are
concerned, the controversy therein has not been fully settled
and the disposition of the case is definitely incomplete.
Moreover, to require private respondent to refile another case
for the settlement of its claim will result in unnecessary delay
and expenses and will entail multiplicity of suits and,
therefore, defeat the very purpose of intervention which is to
hear and determine at the same time all conflicting claims
which may be made on the subject matter in litigation, and to
expedite litigation and settle in one action and by a single
judgment the whole controversy among the persons involved.
OLD RULE: PRE-TRIAL Rule 18, Section 1. When
conducted. - After the last pleading has been served and filed,
it shall be the duty of the plaintiff to promptly move ex parte
that the case be set for pre-trial.
NEW RULE: A.M. No. 03-1-09-SC, dated August 16, 2004
(Rule on Guidelines to be Observed by Trial Court Judges and
Clerks of Court in the Conduct of Pre-Trial and Use of
Deposition - Discovery Measures) provides that within 5 days
from date of filing of reply, the plaintiff must promptly move
ex-parte that the case be set for pre-trial conference. If the
plaintiff fails to file said motion within the given period, the
Branch Clerk of Court shall issue a notice of pre-trial.
PEOPLE OF THE PHILIPPINES, petitioner, vs. HON.
GREGORIO D. MONTEJO, Judge of the Court of First
Instance of Zamboanga City, and FELIX WEE SIT,
respondent.
G.R. No. L-24154 October 31, 1967
FACTS:
A Criminal Case was filed in the Court of First Instance of
Zamboanga City against Felix Wee Sit for homicide and
serious physical injuries thru reckless imprudence.
It was stated that Ernesto Uaje, "a permanent resident of
Montalban, Rizal," then a patrolman in the Montalban Police
Department, "is a material and important witness in the case"
his affidavit having served as the basis for filing the
information as he "happened to be an eye-witness during the
traffic incident wherein a Private Jeep driven recklessly by the
accused Felix Wee Sit.
During the trial, the witness had returned to Montalban, Rizal.
Respondent Judge Montejo issued a subpoena to patrolman
Uaje addressed at his known address at Montalban, Rizal, for
him to appear at the trial.
Such subpoena was received by Uaje. However, he did not
appear at the trial. The City Fiscal formally moved for an
order of arrest" or in the alternative "to cite him for contempt
9
for willful failure to appear at the trial of the case as a material
witness. However, such motion was denied by the respondent
Judge.
Hence, a petition was filed before the Supreme Court. In his
Answer, respondent Judge relied on Section 9 of Rule 23
contending that the witness was not bound by a subpoena
since his residence was admittedly not less than 50 kilometers
from the place of trial, the failure to obey the same or to
comply with it could not in any manner whatsoever constitute
contempt of court. According to him, "an examination of the
placement on Section 9 of Rule 23 discloses that it would
include both criminal and civil cases. It will be noted further
that the provision of Section 9, Rule 23 makes no
distinction between a criminal or civil case.
ISSUE:
Whether a Court of First Instance possesses authority in a
criminal case "to compel by subpoena the attendance of the
witness who, as in this case, resides hundreds of miles away
from the place of trial."
RULING:
Yes. Although Section 9 of Rule 23 is interpreted to apply
solely to civil cases; under the circumstances, in view of the
serious handicap to which the prosecution would thus be
subjected in proving its case, it would follow then that
respondent Judge should decide said motion without taking
into consideration Section 9 of Rule 23.
H. C. LIEBENOW, plaintiff-appellant, vs. THE
PHILIPPINE VEGETABLE OIL COMPANY, defendant-
appellee.
G.R. No. L-13463 November 9, 1918
FACTS:
An action was instituted by the plaintiff, H. C. Liebenow, in
the Court of First Instance of Manila against the defendant, the
Philippine Vegetable Oil Company, a corporation engaged in
the manufacture of coconut oil. The purpose of the proceeding
is to recover a sum of money to which the plaintiff considers
himself entitled by way of a bonus in addition to the salary
earned by him while in the employment of the defendant
company as superintendent of its factory. During the trial,
plaintiff moved for the issuance of a subpoena duces tecum.
Said subpoena was directed to the managing director of the
Philippine Vegetable Oil Company and commanded him to
produce in court documents, records, and papers relative to the
company's business.
However, the attorney for the defendant moved to vacate this
subpoena on the ground that the plaintiff was not entitled to
require the production of the documents called for. The trial
court ruled that the evidence which the plaintiff sought to
elicit was irrelevant. The witness was therefore excused from
producing the papers mentioned in the subpoena duces tecum.
ISSUE:
Whether or not the trial court erred in granting the defendant’s
motion to vacate the subpoena duces tecum.
RULING:
No. The plaintiff’s contention is untenable that he was entitled
to a bonus the amount of which should be determined by the
court with a view to the usefulness and efficiency which he
had exhibited in the course of his employment; and he insists
that the profits earned by the defendant during the time he was
employed as superintendent of the Nagtahan factory are
relevant in determining the amount to be thus awarded. The
court committed no error in refusing to compel the
production of the documents and records in question. The
right to the bonus was wholly independent of the profits,
and the amount of the profits could not properly be taken
into consideration by the court at all.
In determining whether the production of the documents
described in a subpoena duces tecum should be enforced by
the court, it is proper to consider;
1. Whether the subpoena calls for the production of specific
documents, or rather for specific proof; and
2. Whether that proof is prima facie sufficiently relevant to
justify enforcing its production.
A general inquisitorial examination of all the books, papers,
and documents of an adversary, conducted with a view to
ascertain whether something of value may not show up, will
not be enforced.
LOURDES CAMUS DE LOPEZ, on her behalf and as
guardian ad litem of the minors,
SALVADOR C. LOPEZ, JR., and LUIS CARLOS
LOPEZ, petitioners,
vs.
HON. CIRILO G. MACEREN, Judge of the Court of First
Instance of Davao,
MARIA N. VDA. DE LOPEZ, ENRIQUE LOPEZ,
SALVADOR LOPEZ, JR., LEOPOLDO LOPEZ,
RODOLFO LOPEZ and the guardian ad litem for the
minor FLORDELIZ LOPEZ, respondents.
G.R. No. L-7424 August 31, 1954
FACTS:
Petitioner Lourdes Camus de Lopez, on her behalf and as
guardian ad litem of her minor children, Salvador C. Lopez,
Jr., and Luis Carlos Lopez, filed a civil case the purpose of
10
which is to secure delivery of some property of the deceased
Salvador Lopez, Sr., as alleged share of the petitioner, who
claims to be his widow in the Court of First Instance of Davao.
After the filing of the answer of said respondents, petitioner
through her counsel filed a "notice for the taking" of her
deposition and that of one Pilar Cristobal, at Azcarraga Street,
Manila. However, upon an urgent motion of the respondents,
Judge Maceren issued an order prohibiting the taking of said
deposition.
ISSUE:
Whether or not the respondent Judge committed a grave abuse
of discretion in prohibiting the taking of said deposition.
RULING:
Yes. Petitioner was permitted to institute and maintain the
civil case as a pauper. As such, she cannot afford to meet the
expenses to make, with her witnesses, the trip or trips from
Manila to Davao, and to stay in said province for the time
necessary for the hearing of the case. Hence, the order in
question tended, in effect, to deprive her, not only of her right,
under the Rules of Court, to take the deposition in question,
but also, of the opportunity to prove her claim and,
consequently, of the due process guaranteed by the
Constitution. Upon the other hand, the records indicate that the
defendants — who are the widow of Salvador Lopez, Sr. and
their legitimate children are well-off financially, for the estate
of the deceased Salvador Lopez, Sr., which has already been
partitioned among them, appears to be worth approximately
half a million pesos. The main reason given in support of the
contested order is that, if the deposition were taken, the court
could not observe the behaviour of the deponents. The
insufficiency of this circumstance to justify the interdiction of
the taking of a deposition becomes apparent when we consider
that, otherwise, no deposition could ever be taken, said
objection or handicap being common to all depositions alike.
In other words, the order of respondent Judge cannot be
sustained without nullifying the right to take depositions, and,
therefore, without, in effect repealing the Rules of Court,
which, clearly, was not intended by the framers of the same
rule.
SILVERIO VERAN, LUIS VERAN, CRISTINA VERAN,
LEON VERAN, GREGORIO SALAMERA, and
GENEROSA SALAMERA, petitioners,
vs.
The HON. COURT OF APPEALS and PRIMITIVA
VILLAREAL, respondents.
G.R. No. L-41154 January 29, 1988
FACTS:
Petitioners brought this action to recover possession of a
parcel of land located in Atimonan, Quezon and registered in
the name of Aleja Glodoveza, mother and grandmother of said
petitioners, against the respondent Primitiva Villareal, who
died during the pendency of this action and was substituted
accordingly.
Petitioners alleged in the complaint that they only allowed the
respondent, being a cousin, to erect her house on a portion of
the land in dispute, which they inherited from Aleja
Glodoveza, who in turn received it as her share from her
mother's estate. Said respondent, however, refused to vacate
the lot when demanded to do so repeatedly, claiming co-
ownership also by inheritance from their common ancestor,
the mother of Aleja Glodoveza. Thus, in the amended answer,
respondent interposed an special defenses that the land was
originally owned pro-indiviso and in common by the late
Leocadia Glodoveza, respondent's mother, the deceased Aleja
Glodoveza, petitioners' predecessor, and the late Ladislawa
Glodoveza, all children of Cornelio Glodoveza and Filomena
Padilla, after whose death their children above-mentioned
orally partitioned said land, by virtue of which the portion
occupied by the respondent was given and received by her
from her predecessor, and the other portion by the petitioners
and other co-heirs over said realty.
In the meantime, she filed a protest to the Director of Lands
after she learned that the petitioners through fraud, deceit,
misrepresentation, by illegal means and irregularly obtained
their free patent.
Because of the pendency of the administrative case as
mentioned in the answer, the trial of the case was suspended
indefinitely on petition of both parties. However, when the
petitioners changed their counsel, the latter moved for the
setting of the case for trial after almost four years when the
complaint was filed, the motion was granted, but for failure of
the respondent to appear on the date set for hearing, petitioners
were allowed to present their evidence ex-parte, after which
decision was rendered in favor of the petitioners. Upon a
motion for reconsideration, the decision was set aside in order
to allow the respondent to present her evidence.
Respondent offered as part of her evidence the deposition of
Apolonia Glodoveza, but it was denied admission by the trial
court on the ground that no proof was submitted to show that
the witness was so old and infirm as not to be able to come to
court to testify, as contended by the petitioners in their
opposition to the deposition-taking. After trial, judgment was
rendered in favor of the petitioners declaring them owners pro
indiviso of the land. On appeal, the Court of Appeals reversed
the decision of the trial court.
ISSUE:
Whether or not the Court of Appeals erred in finding the
rejection by the trial court of witness Apolonia Glodoveza’s
deposition as erroneous.
RULING:
11
No. Considering that the deposition was taken long after the
answer had been filed and served, there was therefore no need
to seek the approval of the trial court for the taking of the
deposition, notice of such taking being sufficient. In the
instant case, it is not disputed that notice of the deposition-
taking was received by petitioners well before the intended
date and that although petitioners filed an opposition, this was
not acted upon by the trial court before the taking of the
deposition.
Leave of court for taking depositions should, however, be
distinguished from the approval of the court for the use of the
deposition Under the Revised Rules of Court, which was
already in force and effect when the deposition was offered in
evidence:
(c) The deposition of a witness, whether or
not a party, may be used by any party for
any purpose if the court finds:
(3) That the witness is
unable to attend or testify
because of age, sickness,
infirmity, or
imprisonment;
Thus, with regard to the use of a deposition, there is occasion
for the court to exercise its discretion, the proper time being
when the deposition is formally offered in evidence. In the
instant case, the trial court did not admit the deposition when
it was formally offered, on the ground that petitioners were
denied their right to cross-examine the deponent. However,
the Court of Appeals, in deciding to admit the deposition,
observed that to reject such a deposition on the ground
considered by the trial court smacks of a technicality which
does not serve the ends of substantial justice. The counsel of
the petitioners was notified sufficiently in advance of the
deposition-taking, and the opposition was not acted upon
favorably before the day set for the taking of the deposition. If
he failed to appear on that day, as he could have done if he
exerted diligent efforts, he did so at his own risk.
The findings of fact supporting this conclusion of the Court of
Appeals not being disputed, the court agree that, under the
circumstance, petitioners' contention that they were denied
their right to cross-examine the deponent is unfounded.
Further, as pointed out by respondent, before the deposition
was formally offered, respondent had already testified as to
the age of deponent who indicated that Apolonia Glodoveza of
Atimonan, Quezon is very old, more or less, ninety years of
age. Apparently, this was overlooked by the trial court when it
denied admission of the deposition.
With the admission of the deposition, a very significant fact
gets into the records which is that the assignment of the lot in
question was to the three sisters, not to Aleja alone, and the
segregation or apportionment thereof among the said sisters
was made by their eldest sister, Ruperta Glodoveza in 1905.
REPUBLIC OF THE PHILIPPINES (PRESIDENTIAL
COMMISSION ON GOOD GOVERNMENT), petitioner,
vs.
SANDIGANBAYAN, BIENVENIDO R. TANTOCO, JR.
and DOMINADOR R. SANTIAGO, respondents.
G.R. No. 90478 November 21, 1991
FACTS:
Private respondents Bienvenido R. Tantoco, Jr. and
Dominador R. Santiago — together with Ferdinand E. Marcos,
Imelda R. Marcos, Bienvenido R. Tantoco, Sr., Gliceria R.
Tantoco, and Maria Lourdes Tantoco-Pineda are defendants in
a civil case commenced by the Presidential Commission on
Good Government (PCGG) in behalf of the Republic of the
Philippines before the Sandiganbayan. The complaint which
initiated the action was denominated one "for reconveyance,
reversion, accounting, restitution and damages," and was
avowedly filed pursuant to Executive Order No. 14 of
President Corazon C. Aquino.
After having been served with summons, Tantoco, Jr. and
Santiago, instead of filing their answer, jointly filed a
"MOTION TO STRIKE OUT SOME PORTIONS OF THE
COMPLAINT AND FOR BILL OF PARTICULARS OF
OTHER PORTIONS". The Sandiganbayan, in order to
expedite proceedings and accommodate the defendants, gave
the PCGG forty-five (45) days to expand its complaint to
make more specific certain allegations.
Tantoco and Santiago then presented a "motion for leave to
file interrogatories under the Rules of Court", and
"Interrogatories." Basically, they sought an answer to the
question: "Who were the Commissioners of the PCGG (aside
from its Chairman, Hon. Ramon Diaz, who verified the
complaint) who approved or authorized the inclusion of
Messrs. Bienvenido R. Tantoco, Jr. and Dominador R.
Santiago as defendants in the case?" The PCGG responded by
filing a motion to strike out said motion and interrogatories as
being impertinent, "queer," "weird," or "procedurally bizarre
as the purpose thereof lacks merit as it is improper,
impertinent and irrelevant under any
guise."
In compliance, the PCGG filed an Expanded Complaint. As
this expanded complaint, Tantoco and Santiago reiterated their
motion for bill of particulars, through a Manifestation.
Afterwards, the Sandiganbayan denied the motion to strike
out, for bill of particulars, and for leave to file interrogatories,
holding them to be without legal and factual basis. The
Sandiganbayan declared the complaint to be "sufficiently
definite and clear enough." It also opined that "service of
interrogatories before joinder of issue and without leave of
court is premature absent any special or extraordinary
circumstances which would justify the same."
12
Tantoco and Santiago then filed an Answer with Compulsory
Counterclaim. In response, the PCGG presented a "Reply to
Answer with Motion to Dismiss Compulsory Counterclaim."
Tantoco and Santiago filed with the Sandiganbayan a pleading
denominated "Interrogatories to Plaintiff" and an "Amended
Interrogatories to Plaintiff"' as well as a Motion for Production
and Inspection of Documents.
The amended interrogatories chiefly sought factual details
relative to specific averments of PCGG's amended complaint,
through such questions, for instance, as—
1. In connection with the allegations in
paragraph 1, what specific property or
properties does the plaintiff claim it has the
right to recover from defendants Tantoco,
Jr. and Santiago for being ill-gotten?
2. In connection with the allegations in
paragraph 10 (a) what specific act or acts
were committed by defendants Tantoco, Jr.
and Santiago in "concert with" defendant
Ferdinand Marcos and in furtherance or
pursuit, of the alleged systematic plan of
said defendant Marcos to accumulate ill-
gotten wealth?"
3. In connection with paragraph 13, what
specific act or acts of the defendants
Tantoco, Jr. and Santiago were committed
by said defendants as part, or in
furtherance, of the alleged plan to conceal
assets of defendants Ferdinand and Imelda
Marcos?
4. In connection with paragraph 15(c) is it
plaintiff's position or theory of the case that
Tourist Duty Free Shops, Inc., including all
the assets of said corporation, are
beneficially owned by either or both
defendants Ferdinand and Imelda Marcos
and that the defendants Tantoco, Jr. and
Santiago, as well as, the other stockholders
of record of the same corporation are mere
"dummies" of said defendants Ferdinand
and /or Imelda R. Marcos?
The Sandiganbayan admitted the Amended Interrogatories and
granted the motion for production and inspection of
documents.
The PCGG filed a Motion for Reconsideration of the
Resolution allowing production and inspection of documents.
It argued that since the documents subject thereof would be
marked as exhibits during the pre-trial anyway, the order for
their production and inspection, are purposeless and
unnecessary. Movants already know of the existence and
contents of the document which "are clearly described in the
Pre-Trial Brief. The documents are "privileged in character"
since they are intended to be used against the PCGG and/or its
Commissioners in violation of Section 4, Executive Order No.
1:
(a) No civil action shall lie against the
Commission or any member thereof for
anything done or omitted in the discharge of
the task contemplated by this Order.
(b) No member or staff of the Commission
shall be required to testify or produce
evidence in any judicial, legislative, or
administrative proceeding concerning
matters within its official cognizance.
It also filed an opposition to the Amended Interrogatories. The
opposition alleged the interrogatories "are not specific and do
not name the person to whom they are propounded," or "who
in the PCGG, in particular should answer the interrogatories.
The interrogatories "are frivolous" since they inquire about
"matters of fact which defendants sought to extract through
their aborted Motion for Bill of Particulars."
After hearing, the Sandiganbayan promulgated denying
reconsideration of the Resolution allowing production of
documents and reiterating by implication the permission to
serve the amended interrogatories on the plaintiff (PCGG).
ISSUE:
Whether or not the Sandiganbayan committed grave abuse of
discretion amounting to excess of jurisdiction in allowing the
amended interrogatories to the plaintiff PCGG and granting
the motion for production of documents.
RULING:
Involved in the present proceedings are two of the modes of
discovery provided in the Rules of Court:
1. Interrogatories to parties.
2. Production and inspection of documents and things.
The various modes or instruments of discovery are meant to
serve’
(1) As a device, along with the pre-trial hearing under Rule 20,
to narrow and clarify the basic issues between the parties; and
(2) As a device for ascertaining the facts relative to those
issues.
The evident purpose is, to repeat, to enable parties, consistent
with recognized privileges, to obtain the fullest possible
13
knowledge of the issues and facts before trials and thus
prevent that said trials are carried on in the dark.
In line with this principle of according liberal treatment to the
deposition-discovery mechanism, such modes of discovery as;
(a) Depositions (whether by oral examination or written
interrogatories) under Rule 24;
(b) Interrogatories to parties under Rule 25; and
(c) Requests for admissions under Rule 26, may be availed of
without leave of court, and generally, without court
intervention.
The Rules of Court explicitly provide that leave of court is not
necessary to avail of said modes of discovery after an answer
to the complaint has been served. It is only when an answer
has not yet been filed (but after jurisdiction has been obtained
over the defendant or property subject of the action) that prior
leave of court is needed to avail of these modes of discovery,
the reason being that at that time the issues are not yet joined
and the disputed facts are not clear.
On the other hand, leave of court is required as regards
discovery by;
(a) Production or inspection of documents or things in
accordance with Rule 27; or
(b) Physical and mental examination of persons under Rule
28, which may be granted upon due application and a showing
of due cause.
To ensure that availment of the modes of discovery is
otherwise untrammeled and efficacious, the law imposes
serious sanctions on the party who refuses to make discovery,
such as;
1. Dismissing the action or proceeding or part thereof, or
rendering judgment by default against the disobedient party;
2. Contempt of court, or arrest of the party or agent of the
party;
3. Payment of the amount of reasonable expenses incurred in
obtaining a court order to compel discovery;
4. Taking the matters inquired into as established in
accordance with the claim of the party seeking discovery;
5. Refusal to allow the disobedient party support or oppose
designated claims or defenses;
6. Striking out pleadings or parts thereof; or
7. Staying further proceedings.
No. The petitioner's objections to the interrogatories served on
it in accordance with the Rules of Court cannot be sustained.
It should initially be pointed out — as regards the private
respondents "Motion for Leave to File Interrogatories"— that
it was correct for them to seek leave to serve interrogatories,
because discovery was being availed of before an answer had
been served. In such a situation, i.e., "after jurisdiction has
been obtained over any defendant or over property subject of
the action" but before answer, Section 1 of Rule 24 (treating of
depositions), in relation to Section 1 of Rule 25 (dealing with
interrogatories to parties) explicitly requires "leave of court."
But there was no need for the private respondents to seek such
leave to serve their "Amended Interrogatories to Plaintiff"
after they had filed their answer to the PCGG's complaint, just
as there was no need for the Sandiganbayan to act thereon.
1. The petitioner's first contention — that the interrogatories in
question are defective because they (a) do not name the
particular individuals to whom they are propounded, being
addressed only to the PCGG, and (b) are "fundamentally the
same matters (private respondents) sought to be clarified
through their aborted Motion for Bill of Particulars" — are
untenable.
The first part of petitioner's submission is adequately confuted
by Section 1, Rule 25 which states that if the party served with
interrogatories is a juridical entity such as "a public or private
corporation or a partnership or association," the same shall be
"answered by any officer thereof competent to testify in its
behalf." There is absolutely no reason why this proposition
should not be applied by analogy to the interrogatories served
on the PCGG. That the interrogatories are addressed only to
the PCGG, without naming any specific commissioner o
officer thereof, is utterly of no consequence, and may not be
invoked as a reason to refuse to answer. As the rule states, the
interrogatories shall be answered "by any officer thereof
competent to testify in its behalf."
That the matters on which discovery is desired are the same
matters subject of a prior motion for bill of particulars
addressed to the PCGG's amended complaint — and denied
for lack of merit — is beside the point. Indeed, as already
pointed out above, a bill of particulars may elicit only ultimate
facts, not so-called evidentiary facts. The latter are without
doubt proper subject of discovery.
Neither may it be validly argued that the amended
interrogatories lack specificity. The merest glance at them
disproves the argument. The interrogatories are made to relate
to individual paragraphs of the PCGG's expanded complaint
and inquire about details of the ultimate facts therein alleged.
What the PCGG may properly do is to object to specific items
of the interrogatories, on the ground of lack of relevancy, or
privilege, or that the inquiries are being made in bad faith, or
14
simply to embarass or oppress it. But until such an objection is
presented and sustained, the obligation to answer subsists.
2. That the interrogatories deal with factual matters which will
be part of the PCGG's proof upon trial, is not ground for
suppressing them either. As already pointed out, it is the
precise purpose of discovery to ensure mutual knowledge of
all the relevant facts on the part of all parties even before trial,
this being deemed essential to proper litigation. This is why
either party may compel the other to disgorge whatever facts
he has in his possession; and the stage at which disclosure of
evidence is made is advanced from the time of trial to the
period preceding it.
3. Also unmeritorious is the objection that the interrogatories
would make PCGG Commissioners and officers witnesses, in
contravention of Executive Order No. 14 and related
issuances. In the first place, there is nothing at all wrong in a
party's making his adversary his witness. This is expressly
allowed by Section 6, Rule 132 of the Rules of Court on the
direct examination of unwilling or hostile witnesses.
The PCGG insinuates that the private respondents are engaged
on a "fishing expedition," apart from the fact that the
information sought is immaterial since they are evidently
meant to establish a claim against PCGG officers who are not
parties to the action. It suffices to point out that "fishing
expeditions" are precisely permitted through the modes of
discovery. Moreover, a defendant who files a counterclaim
against the plaintiff is allowed by the Rules to implead persons
(therefore strangers to the action) as additional defendants on
said counterclaim. This may be done pursuant to Section 14,
Rule 6 of the Rules.
The PCGG's assertion that it or its members are not amenable
to any civil action "for anything done or omitted in the
discharge of the task contemplated by Executive Order No. 1
is not a ground to refuse to answer the interrogatories. The
disclosure of fact relevant to the action and which are not self-
incriminatory or otherwise privileged is one thing; the matter
of whether or not liability may arise from the facts disclosed in
light of Executive Order No. 1, is another. No doubt, the latter
proposition may properly be set up by way of defense in the
action.
The apprehension has been expressed that the answers to the
interrogatories may be utilized as foundation for a
counterclaim against the PCGG or its members and officers.
They will be. The private respondents have made no secret
that this is in fact their intention. Withal, the Court is unable to
uphold the proposition that while the PCGG obviously feels
itself at liberty to bring actions on the basis of its study and
appreciation of the evidence in its possession, the parties sued
should not be free to file counterclaims in the same actions
against the PCGG or its officers for gross neglect or
ignorance, if not downright bad faith or malice in the
commencement or initiation of such judicial proceedings, or
that in the actions that it may bring, the PCGG may opt not to
be bound by rule applicable to the parties it has sued, e.g., the
rules of discovery.
So, too, the PCGG's postulation that none of its members may
be "required to testify or produce evidence in any judicial
proceeding concerning matters within its official cognizance,"
has no application to a judicial proceeding it has itself
initiated. As just suggested, the act of bringing suit must entail
a waiver of the exemption from giving evidence; by bringing
suit it brings itself within the operation and scope of all the
rules governing civil actions, including the rights and duties
under the rules of discovery. Otherwise, the absurd would
have to be conceded, that while the parties it has impleaded as
defendants may be required to "disgorge all the facts" within
their knowledge and in their possession, it may not itself be
subject to a like compulsion.
The Court also finds itself unable to sustain the PCGG's other
principal contention, of the nullity of the Sandiganbayan's
Order for the production and inspection of specified
documents and things allegedly in its possession.
The Court gives short shrift to the argument that some
documents sought to be produced and inspected had already
been presented in Court and marked preliminarily as PCGG's
exhibits, the movants having in fact viewed, scrutinized and
even offered objections thereto and made comments thereon.
Obviously, there is nothing secret or confidential about these
documents. No serious objection can therefore be presented to
the desire of the private respondents to have copies of those
documents in order to study them some more or otherwise use
them during the trial for any purpose allowed by law.
The PCGG says that some of the documents are non-existent.
This it can allege in response to the corresponding question in
the interrogatories, and it will incur no sanction for doing so
unless it is subsequently established that the denial is false.
The claim that use of the documents is proscribed by
Executive Order No. 1 has already been dealt with. The PCGG
is however at liberty to allege and prove that said documents
fall within some other privilege, constitutional or statutory.
The Court finally finds that, contrary to the petitioner's theory,
there is good cause for the production and inspection of the
documents subject of the motion dated August 3, 1989. Some
of the documents are, according to the verification of the
amended complaint, the basis of several of the material
allegations of said complaint. Others, admittedly, are to be
used in evidence by the plaintiff. It is matters such as these
into which inquiry is precisely allowed by the rules of
discovery, to the end that the parties may adequately prepare
for pre-trial and trial. The only other documents sought to be
produced are needed in relation to the allegations of the
counterclaim. Their relevance is indisputable; their disclosure
may not be opposed.
15
G.R. No. L-29742 March 29, 1972
VICENTE YU, plaintiff-appellant, vs. EMILIO MAPAYO,
defendant-appellee.
FACTS:
Vicente Yu filed a suit against Emilio Mapayo to recover the
sum of P 2,800 representing the unpaid balance of the
purchase price of a Gray Marine Engine sold by the plaintiff to
the defendant in the City Court of Davao.
The answer admitted the transaction and the balance due but
contended that by reason of hidden defects of the article sold,
the defendant had been forced to spend P2, 800 for repairs and
labor, wherefore plaintiff had agreed to waive the balance due
on the price of the engine, and counterclaimed for damages
and attorneys' fees.
The City Court, after trial, disallowed the defenses and
ordered the defendant to pay plaintiff P2, 500.00 and costs.
Defendant Mapayo appealed to the Court of First Instance of
Davao. When, after several continuances, the case was called
for hearing on 13 March 1968, the defendant, as well as his
counsel, failed to appear and the court scheduled the case for
hearing ex parte on the same day. The Court ordered plaintiff
to present his evidence. However, the attorney for the plaintiff
refuses to present evidence, either oral or documentary, when
required by the Court. The case was dismissed for lack of
prosecution.
ISSUE:
Whether or not the plaintiff’s counsel is correct when it
refused to comply the order of the trial court to present
evidence and demanded that he would introduce evidence
only in rebuttal.
RULING:
Yes. Since the answer admitted defendant's obligation as
stated in the complaint, albeit special defenses were pleaded,
plaintiff had every right to insist that it was for defendant to
come forward with evidence in support of his special defenses.
Section 2 of Revised Rule of Court 129 plainly supports
appellant:
Sec. 2. Judicial admissions.— Admissions
made by the parties in the pleadings, or in
the course of the trial or other proceedings
do not require proof and cannot be
contradicted unless previously shown to
have been made through palpable mistake.
Defendant not having supported his special defenses, the
dismissal of the case was manifestly untenable and contrary to
law. The court below is directed to enter judgment in favor of
plaintiff and against the defendant for the sum of P2, 800.00.
G.R. No. L-20089 December 26, 1964
BEATRIZ P. WASSMER, plaintiff-appellee, vs.
FRANCISCO X. VELEZ, defendant-appellant.
FACTS:
Francisco X. Velez and Beatriz P. Wassmer, following their
mutual promise of love, decided to get married and set
September 4, 1954 as the big day. On September 2, 1954
Velez left this note for his bride-to-be:
Dear Bet —
Will have to postpone wedding — My
mother opposes it. Am leaving on the
Convair today.
Please do not ask too many people about the
reason why — That would only create a
scandal.
Paquing
But the next day, September 3, he sent her the following
telegram:
NOTHING CHANGED REST ASSURED
RETURNING VERY SOON APOLOGIZE
MAMA PAPA LOVE .
PAKING
Thereafter Velez did not appear nor was he heard from again.
Beatriz filed an action for breach of promise to marry with
damages. Velez filed no answer and was declared in default.
Plaintiff adduced evidence before the clerk of court as
commissioner, and on April 29, 1955, judgment was rendered
ordering defendant to pay plaintiff P2, 000.00 as actual
damages; P25, 000.00 as moral and exemplary damages;
P2,500.00 as attorney's fees; and the costs.
On June 21, 1955 defendant filed a "petition for relief from
orders, judgment and proceedings and motion for new trial
and reconsideration." Plaintiff moved to strike it cut. But the
court, on August 2, 1955, ordered the parties and their
attorneys to appear before it on August 23, 1955 "to explore at
this stage of the proceedings the possibility of arriving at an
amicable settlement." It added that should any of them fail to
appear "the petition for relief and the opposition thereto will
be deemed submitted for resolution."
16
On August 23, 1955 defendant failed to appear before court.
Instead, on the following day his counsel filed a motion to
defer for two weeks the resolution on defendant’s petition for
relief. The counsel stated that he would confer with defendant
in Cagayan de Oro City — the latter's residence — on the
possibility of an amicable settlement. The court granted two
weeks counted from August 25, 1955.
Plaintiff manifested on June 15, 1956 that the two weeks given
by the court had expired on September 8, 1955 but that
defendant and his counsel had failed to appear.
Another chance for amicable settlement was given by the
court in its order of July 6, 1956 calling the parties and their
attorneys to appear on July 13, 1956. This time, however,
defendant's counsel informed the court that chances of settling
the case amicably were nil.
On July 20, 1956 the court issued an order denying
defendant's aforesaid petition. Defendant has appealed to this
Court. In his petition of June 21, 1955 in the court a quo
defendant alleged excusable negligence as ground to set aside
the judgment by default. Specifically, it was stated that
defendant filed no answer in the belief that an amicable
settlement was being negotiated.
A petition for relief from judgment on grounds of fraud,
accident, mistake or excusable negligence, must be duly
supported by an affidavit of merits stating facts constituting a
valid defense. Defendant's affidavit of merits attached to his
petition of June 21, 1955 stated: "That he has a good and valid
defense against plaintiff's cause of action, his failure to marry
the plaintiff as scheduled having been due to fortuitous event
and/or circumstances beyond his control." An affidavit of
merits like this stating mere conclusions or opinions instead of
facts is not valid.
ISSUE:
Whether or not the defendant’s consent need to be
obtained to the procedure of adducing evidence before the
clerk of court.
RULING:
No. Defendant, however, would contend that the affidavit
of merits was in fact unnecessary, or a mere surplusage,
because the judgment sought to be set aside was null and
void, it having been based on evidence adduced before the
clerk of court. In Province of Pangasinan vs. Palisoc, L-
16519, October 30, 1962, this Court pointed out that the
procedure of designating the clerk of court as commissioner to
receive evidence is sanctioned by Rule 34 (now Rule 33) of
the Rules of Court. Now as to defendant's consent to said
procedure, the same did not have to be obtained for he was
declared in default and thus had no standing in court.
Article 21 of said Code provides that "any person who wilfully
causes loss or injury to another in a manner that is contrary to
morals, good customs or public policy shall compensate the
latter for the damage."
Surely this is not a case of mere breach of promise to marry.
As stated, mere breach of promise to marry is not an
actionable wrong. But to formally set a wedding and go
through all the above-described preparation and publicity,
only to walk out of it when the matrimony is about to be
solemnized, is quite different. This is palpably and
unjustifiably contrary to good customs for which defendant
must be held answerable in damages in accordance with
Article 21.
G.R. No. L-40098 August 29, 1975
ANTONIO LIM TANHU, DY OCHAY, ALFONSO
LEONARDO NG SUA and CO OYO, petitioners, vs.
HON. JOSE R. RAMOLETE as Presiding Judge, Branch
III, CFI, Cebu and TAN PUT, respondents.
FACTS:
A complaint for accounting of the real and personal properties
of the Glory Commercial Company located in the Philippines
and in Hong Kong was filed on February 9, 1971 by
respondent Tan Put against the spouses-petitioners Antonio
Lim Tanhu and Dy Ochay as well as Alfonso Leonardo Ng
Sua and Co Oyo.
Tan alleged that she "is the widow of Tee Hoon Lim Po
Chuan, who was a partner in the commercial partnership,
Glory Commercial Company with the petitioners, through
fraud and machination, took actual and active management of
the partnership and although her husband was the manager of
Glory Commercial Company, defendants managed to use the
funds of the partnership to purchase lands and building's in the
cities of Cebu, Lapu-Lapu, Mandaue, and the municipalities of
Talisay and Minglanilla.
On February 3, 1973, however, the date set for the pre-trial,
both of the two defendants-spouses, did not appear, for which
reason, upon motion of plaintiff, in an order, they were all
"declared in DEFAULT when they failed to appear at the pre-
trial."
The hearing of the plaintiff's evidence ex-parte was set before
the Branch Clerk of Court who is deputized for the purpose.
But the scheduled ex-parte reception of evidence did not take
place on November 20, 1974, for on October 28, 1974, upon
verbal motion of plaintiff, the court issued the following self-
explanatory order: .
Acting favorably on the motion of the plaintiff dated October
18, 1974, the Court deputized the Branch Clerk of Court to
receive the evidence of the plaintiff ex-parte to be made on
17
November 20, 1974. However, on October 28, 1974, the
plaintiff, together with her witnesses, appeared in court and
asked, thru counsel that she be allowed to present her
evidence.
Considering the time and expenses incurred by the plaintiff in
bringing her witnesses to the court, the Branch Clerk of Court
is hereby authorized to receive immediately the evidence of
the plaintiff ex-parte.
Upon learning of these orders on October 23, 1973, the
defendant Lim Teck Cheng, thru counsel, Atty. Sitoy, filed a
motion for reconsideration thereof, and on November 1, 1974,
defendant Eng Chong Leonardo, thru counsel Atty. Alcudia,
filed also his own motion for reconsideration and clarification
of the same orders. These motions were denied in an order
dated December 6, 1974 but received by the movants only on
December 23, 1974. Meanwhile, respondent court rendered
the impugned decision on December 20, 1974. It does not
appear when the parties were served copies of this decision.
ISSUE:
Whether or not the ex-parte reception of the evidence of
the plaintiff by the clerk of court can be the basis for the
court rendition of a judgment.
RULING:
No. The delegation to the clerk of court of the function of
receiving plaintiff's evidence is irregular. And as regards the
ex-parte reception of plaintiff's evidence and subsequent
rendition of the judgment by default based thereon, it was
violative of the right of the petitioners, under the applicable
rules and principles on default, to a common and single fate
with their non-defaulted co-defendants.
OLD RULE: Lim Tanhu vs. Ramolete - prohibits the
delegation of the power to receive evidence on Clerks of
Court.
NEW RULE: Section 9, Rule 30 of the 1997 Rules of Civil
Procedure - Judge to receive evidence; delegation to clerk of
court. — The judge of the court where the case is pending
shall personally receive the evidence to be adduced by the
parties. However, in default or ex parte hearings, and in any
case where the parties agree in writing, the court may delegate
the reception of evidence to its clerk of court who is a member
of the bar. The clerk of court shall have no power to rule on
objections to any question or to the admission of exhibits,
which objections shall be resolved by the court upon
submission of his report and the transcripts within ten (10)
days from termination of the hearing.
G.R. No. L-10884 March 31, 1959
PHILIPPINE NATIONAL BANK, plaintiff-appellee, vs.
PHILIPPINE LEATHER CO. INC., ET AL., defendants-
appellants.
FACTS:
Philippine National Bank filed a complaint in the Court of
First Instance of Manila against Philippine Leather Co. Inc.
PNB alleged that Philippine Leather applied for a commercial
letter of credit in favor of the Turner Tanning Machinery Co.
of Peabody, Massachusetts, U.S.A. to cover the value of
certain machineries and their accessories as well as in favor of
Bay State Chemical Co., of Boston, Massachusetts, U.S.A., to
pay for the importation of color dye. The defendant failed and
refused to pay the amount of the draft and the charges due
thereon.
In its answer, Philippine Leather admitted PNB’s averments
except as to the correctness of the amounts due on the two
drafts, the correctness of which they were still checking.
PNB filed a motion for summary judgment on the ground that
since the defendants had admitted the material averments of its
complaint except as to the correctness of the amounts due, the
defendant's answer did not tender a genuine issue.
The Court granted the plaintiff's motion and rendered
judgment ordering Philippine Leather to pay PNB.
The defendants appealed to the Court of Appeals. The latter
certified the case to this Court for the reason that only
questions of law are raised.
ISSUE:
Whether the trial court is correct in granting the motion
for summary judgment filed by PNB.
RULING:
Yes. The defendant's answer to the cause of action does not
tender a genuine issue. In fact they admit that they are
indebted to the plaintiff. As the affidavit subscribed and sworn
to by the Manager of the Special Assets Department of the
plaintiff, in charge of all outstanding accounts of its debtors,
attached to the motion for summary judgment, furnishes the
Court with the payments made by the defendants on their
account and the amount due from them, which they failed to
oppose by counter affidavits, the plaintiff is entitled to
summary judgment.
G.R. No. L-17721 October 16, 1961
GREGORIO APELARIO, doing business under the style
"GREGORIO TRADING," plaintiff-appellee, vs. INES
CHAVEZ & COMPANY, LTD., doing business under the
style "FIDELITY MOTOR SUPPLY COMPANY, LTD.,
18
and INES CHAVEZ, Defendants-Appellants.
FACTS:
Gregorio Apelario filed a complaint against Ines Chavez &
Company, Ltd., a limited partnership, and its general partner,
Ines Chavez. The defendant partnership had purchased on
credit from plaintiff ten sets of axle assemblies for the sum of
P2, 400.00
Defendant delivered in payment to the plaintiff two postdated
cash checks for P1, 200.00 each, drawn against the Philippine
Bank of Commerce; that when the checks were presented for
payment, they were dishonored for lack of funds.
Plaintiff demanded payment in cash, but defendant refused to
pay.
Defendant filed an answer admitting the allegations of the
complaint; admitting that plaintiff had demanded payment of
P2,400, but pleaded that defendants could not pay the plaintiff,
because they have so many accounts receivables which have
not yet been paid to them, of which fact the defendant, was
duly informed by the plaintiff and thereby requested to wait a
while.
Upon motion of the plaintiff, and over the objection of
defendants, the trial court rendered judgment on the pleadings,
sentencing defendants to pay P2, 400.
ISSUE:
Whether the trial court erred in rendering judgement on
the pleadings.
RULING:
No. The defendants-appellants had admitted all the material
allegations of the complaint concerning the existence of the
debt and its non-payment. The pleaded excuse, that they had
requested plaintiff to, wait because appellants’ many accounts
receivable had not yet been collected, is clearly no defense, for
a debtor cannot delay payment due just to suit its convenience.
Lati vs. Valmores, G.R. No. L-6877, 30 March 1954.
Material averments in a complaint, other than those as to the
amount of damage, are deemed admitted when not specifically
denied. The court may render judgment upon the pleadings if
material averments in the complaint are admitted.
G. R. No. 93219 August 30, 1990
MARCELINO G. RIVERA, JR., Petitioner, vs. PEOPLE
OF THE PHILIPPINES and HON. MARCELINO F.
BAUTISTA, JR.,
Presiding Judge of the Reg ional Trial Court, Branch III,
Baguio City, Respondents.
FACTS:
Marcelino, G. Rivera, Jr. was arrested and detained for he
allegedly was about to transport marijuana to Manila. A case
for violation of R. A. 6425 was filed against him with the
Regional Trial Court of Baguio City.
Petitioner was arraigned. He pleaded not guilty to the crime
charged. The first witness for the prosecution, Cpl. Victorio
Afalla, partially testified on direct examination and reserved
the right to identify the marijuana specimen allegedly
confiscated from the petitioner.
On June 8, 1989, for the same reasons, the hearing was re-set
to February 27, 1990. On February 27, 1990, Capt. Lina
Sarmiento, the Forensic Chemist, who will present the
marijuana specimen, despite notice, failed to appear.
Petitioner, through counsel, then moved for the dismissal of
the case. This was denied by respondent Judge and the hearing
was re-set to March 28, 1990.
On March 28, 1990, when the case was called at about 8:30
a.m. Capt. Lina Sarmiento despite notice, was not around
thereby necessitating a second call. When the case was called
for the second time at around 9:00 a.m. Capt. Sarmiento was
still not around. Hence, Atty. Tomas Gorospe, in behalf of
petitioner, orally moved for the dismissal of the case invoking
the right to speedy trial as the petitioner stands confined and
that the Government failed to prosecute or adduce evidence
due to the non-appearance of a vital prosecution witness.
The respondent Judge verbally granted the motion and ordered
the immediate release of the accused.
While the subsequent calendared cases set for that day was in
progress, and in less than an hour after pronouncement of the
verbal order of dismissal, Capt. Lina Sarmiento arrived direct
from Quezon City. Upon a satisfactory explanation, the
respondent Judge issued his now assailed order setting aside
his previous verbal order of dismissal and re-scheduling Crim.
Case No. 6201-R for continuation of trial.
ISSUE:
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Whether the verbal order of dismissal made in open court
amounted to the acquittal of petitioner and which order is
immediately final and executory, the respondent Judge
could no longer set it aside without violating petitioner's
constitutional right against double jeopardy.
RULING:
No. The earlier verbal order of dismissal was not final, in fact,
was ineffective. The order of dismissal must be written in the
official language, personally and directly prepared by the
judge and signed by him. In the instant case, it is very clear
that the order was merely dictated in open court by the trial
judge. There is no showing that this verbal order of dismissal
was ever reduced to writing and duly signed by him. Thus, it
did not yet attain the effect of a judgment of acquittal, so that
it was still within the powers of the judge to set it aside and
enter another order, now in writing and duly signed by him,
reinstating the case.
LUCIA S. PAJARITO, petitioner, vs.
HON. ALBERTO V. SEÑERIS, Presiding Judge of
Branch II, Court of First Instance of Zamboanga;
JOSELITO AIZON, and FELIPE AIZON, respondents.
FACTS:
Joselito Aizon being the driver of an Isuzu Passenger Bus
owned and operated by FELIPE AIZON was involved in a
vehicular accident. MYRNA PAJARITO DE SAN LUIS and
MUSA BARING, both passengers on board the said Isuzu
passenger bus died. Thus, Joselito Aizon was charged
before the Court of First Instance of Zamboanga City with
Double Homicide Through Reckless Imprudence.
Upon arraignment, said respondent entered a plea of
guilty. In view of said plea, the court rendered judgment
convicting him of the offense charged and sentencing him
"to indemnify the heirs of the late Myrna Pajarito de San
Luis the amount of P12, 000.00.
After the judgment had become final and executory, a
Writ of Execution was issued against Joselito Aizon for the
indemnity of P12, 000.00, but the same was returned
unsatisfied because of his insolvency.
Whereupon, petitioner Lucia S. Pajarito, mother of
the late Myrna Pajarito de San Luis, filed with the
court a motion for the issuance of Subsidiary Writ of
Execution and served a copy thereof to private
respondent Felipe Aizon, employer of Joselito Aizon
as alleged in the Information.
Felipe Aizon opposed the motion on the grounds, to wit:
(1) That he is not the employer of Joselito Aizon, the
vehicle in question having been sold already to Isaac
Aizon, father of Joselito, but that the deed of transfer has
not been executed because the full price has not yet been
paid; and
(2) That in case of insolvency, Joselito has to suffer
subsidiary imprisonment to satisfy the judgment insofar
as the indemnity is concerned.
The court denied petitioner's motion for Subsidiary Writ of
Execution on the ground that Felipe Aizon, alleged
employer of Joselito, was not a party in the aforesaid
criminal case.
ISSUE:
Whether the subsidiary civil liability established in
Articles 102 and 103 of the Revised Penal Code may
be enforced in the same criminal case where the
award was made, or in a separate civil action.
RULING:
The subsidiary civil liability may be enforced in the
same criminal case where the award was made.
Under Article 100 of the Revised Penal Code, a person
criminally liable for a felony is also civilly liable. As a
consequence, the institution of the criminal action carries
with it the institution of the civil action arising therefrom,
except when there is a separate civil action or reservation
of the latter on the part of the complainant.
Pursuant to Article 103, in relation to Article 102, of the
Revised Penal Code, an employer may be subsidiary liable
for the employee's civil liability in a criminal action when:
(1) The employer is engaged in any kind of industry;
(2) The employee committed the offense in the discharge
of his duties; and
(3) He is insolvent and has not satisfied his civil liability.
The subsidiary civil liability of the employer, however,
arises only after conviction of the employee in the criminal
case.
A judgment of conviction sentencing a defendant
employee to pay an indemnity in the absence of any
collusion between the defendant and the offended party,
is conclusive upon the employer in an action for the
enforcement of the latter's subsidiary liability.
The employer becomes ipso facto subsidiarily liable upon
his driver's conviction and upon proof of the latter's
insolvency, in the same way that acquittal wipes out not
only the employee's primary civil liability but also his
employer's subsidiary liability for such criminal
negligence.
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The decision convicting the employee is binding and
conclusive upon the employer, "not only with regard to
(the latter's) civil liability but also with regard to its
amount because the liability of an employer cannot be
separated but follows that of his employee. That is why
the law says that his liability is subsidiary (Article 103,
Revised Penal Code). To allow an employer to dispute the
civil liability fixed in the criminal case would be to amend,
nullify, or defeat a final judgment rendered by a
competent court."

The employer is in substance and in effect a party to the

criminal case, considering the subsidiary liability imposed
upon him by law.

Considering that Felipe Aizon does not deny that he was

the registered operator of the bus but only claims now
that he sold the bus to the father of the accused, it
would serve no important purpose to require
petitioner to file a separate and independent action
against the employer for the enforcement of the
latter's subsidiary civil liability. Under the
circumstances, it would not only prolong the litigation but
would require the heirs of the deceased victim to incur
unnecessary expenses. At any rate, the proceeding for the
enforcement of the subsidiary civil liability may be
considered as part of the proceeding for the execution of
the judgment. A case in which an execution has been
issued is regarded as still pending so that all proceedings
on the execution are proceedings in the suit. There is no
question that the court which rendered the judgment has
a general supervisory control over its process of
execution, and this power carries with it the right to
determine every question of fact and law which may be
involved in the execution.

The validity of the claim of Felipe Aizon that he is no

longer the owner and operator of the in fated bus as he
sold it already to Isaac Aizon, father of the accused
Joselito Aizon, is a matter that could be litigated and
resolved in the same criminal case. In support of his
opposition to the motion of the complainant, served upon
him, for the purpose of the enforcement of his subsidiary
liability Felipe Aizon may adduce all the evidence
necessary for that purpose. Indeed, the enforcement of
the employer's subsidiary civil liability may be
conveniently litigated within the same proceeding because
the execution of the judgment is a logical and integral
part of the case itself. This would certainly facilitate the
application of justice to the rival claims of the contending
parties.

The trial court is directed to hear and decide in the

same proceeding the subsidiary liability of the
alleged owner and operator of the passenger bus.

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