52.
*Adherance to jurisdiction/ Jurisdiction cannot be ousted*
PACIFIC ACE FINANCE LTD. (PAFIN) v. EIJI* YANAGISAWA
G.R. No. 175303 | April 11, 2012 | DEL CASTILLO, J.
…This is a Petition for Review filed by PAFIN of the August 1, 2006 Decision of
the Court of Appeals (CA) in CA-G.R. CV No. 78944 which annulled and set
aside the decision dated April 20, 2003 of the RTC Branch 258, and entered
the annulment of the Real Estate Mortgage executed on Aug. 25, 1998 in
favor of PAFIN.
Doctrine: when a court of competent jurisdiction acquires jurisdiction over the
subject matter of a case, its authority continues, subject only to the appellate
authority, until the matter is finally and completely disposed of, and that no court of
co-ordinate authority is at liberty to interfere with its action. This doctrine is
applicable to civil cases, to criminal prosecutions, and to courts-martial. The
principle is essential to the proper and orderly administration of the laws; and
while its observance might be required on the grounds of judicial comity and
courtesy, it does not rest upon such considerations exclusively, but is enforced to
prevent unseemly, expensive, and dangerous conflicts of jurisdiction and of the
process.
Facts
Respondent Eiji Yanagisawa (Eiji), a Japanese married Evelyn F. Castaeda (Evelyn),
a Filipina, on July 12, 1989l
On August 1995, Evelyn purchased a 152 square-meter townhouse unit located at
Bo. Sto. Nio, Paranaque, Metro Manila (Paranaque townhouse unit). The Registry
of Deeds for Paraaque issued Transfer Certificate of Title (TCT) No. 99791 to
Evelyn P. Castaeda, Filipino, married to Ejie Yanagisawa, Japanese citizen[,]
both of legal age.
In 1996, Eiji filed a complaint for the declaration of nullity of his marriage with
Evelyn on the ground of bigamy (nullity of marriage case). The complaint,
docketed as Civil Case No. 96-776, was raffled to Branch 149 of the Regional
Trial Court of Makati (Makati RTC).
During the pendency of the case, Eiji filed a Motion for the Issuance of a
Restraining Order against Evelyn and an Application for a Writ of a Preliminary
Injunction.
At the hearing on the said motion, Evelyn and her lawyer voluntarily undertook
not to dispose of the properties registered in her name during the pendency of
the case, thus rendering Eijis application and motion moot.
In its its October 2, 1996 Order on Evelyns commitment not to dispose of or
encumber the properties registered in her name was annotated on the TCT of the
Paranque Townhose Unit.
Sometime in after, Evelyn obtained a loan of P500,000.00 PAFIN. To secure the
loan, Evelyn executed on August 25, 1998 a real estate mortgage (REM) in favor
of PAFIN over the Paranaque townhouse unit covered by TCT No. 99791. Which
was duly annotated on the TCT by the Registry of Deeds on the same date.
At the time of the mortgage, Eijis appeal in the nullity of marriage case was pending
before the CA. The Makati RTC had dissolved Eiji and Evelyns marriage, and
had ordered the liquidation of their registered properties, including the
Paraaque townhouse unit, with its proceeds to be divided between the
parties. The Decision of the Makati RTC did not lift or dissolve its October 2, 1996
Order.
Eiji learned of the REM upon its annotation on the TCT. Deeming the mortgage as
a violation of the Makati RTCs October 2, 1996 Order, Eiji filed a complaint
for the annulment of REM (annulment of mortgage case) against Evelyn and
PAFIN. The complaint, docketed as Civil Case No. 98-0431, was raffled to Branch
258 of the Regional Trial Court of Paranaque City (Paranaque RTC).
Both PAFIN and Evelyn denied being aware of the impediment on the mortgage.
Paranaque Regional Trial Court Decision
The RTC dismissed Eijis complaint. The RTC explained that Eiji, as a foreign
national, cannot possibly own the mortgaged property. Without ownership, or any
other law or contract binding the defendants to him, Eiji has no cause of action that
may be asserted against them.
Eiji appealed the trial courts decision arguing that the trial court erred in holding that
his inability to own real estate property in the Philippines deprives him of all interest
in the mortgaged property, which was bought with his money. He added that the
Makati RTC has even recognized his contribution in the purchase of the property by
its declaration that he is entitled to half of the proceeds that would be obtained from
its sale.
Eiji also brought up the undertaking of Evelyn to not dispose of, alienate, or
encumber [dae] the properties registered in her name while the case was pending.
This commitment incapacitates Evelyn from entering into the REM contract.
Court of Appeals Decision
The CA found merit in Eijis appeal.
The CA noted that the Makati RTC ruled on Eijis and Evelyns ownership rights over
the properties that were acquired during their marriage, including the Paranaque
townhouse unit. It was determined therein that the registered properties should be
sold at public auction and the proceeds thereof to be divided between Eiji and
Evelyn.
The appellate court determined that the Paranaque RTCs Decision was
improper because it violated the doctrine of non-interference. Courts of equal
jurisdiction, such as regional trial courts, have no appellate jurisdiction over each
other. For this reason, the CA annulled and set aside the Paranaque RTCs decision
to dismiss Eijis complaint.
The CA noted that Eiji anchored his complaint upon Evelyns violation of her
commitment to the Makati RTC. This commitment created a right in favor of Eiji to
rely thereon and a correlative obligation on Evelyns part not to encumber the
Paraaque townhouse unit. Since Evelyns commitment was annotated on TCT No.
99791, all those who deal with the said property are notified of the burdens on the
property and its registered owner. That being said, Evelyn would have been
aware of her impediment, while PAFIN showed wanton disregard of
ordinary prudence
Thus, the CA annulled the REM executed by Evelyn in favor of PAFIN.
The Evelyn and Pafin filed separately motions for reconsideration on August 22,
2006, which were both denied for lack of merit by the appellate court in its
November 7, 2006 Resolution.
Issue:
Whether the Paranaque RTC can rule on the issue of ownership, even as the same
issue was already ruled upon by the Makati RTC and is pending appeal in the CA.
Ruling:
No. The Paranaque RTC cannot rule on the issue of ownership. Contrary to
petitioners stance, the CA did not make any disposition as to who between Eiji and
Evelyn owns the Paraaque townhouse unit. It simply ruled that the Makati RTC
had acquired jurisdiction over the said question and should not have been
interfered with by the Paranaque RTC. The CA only clarified that it was
improper for the Paranaque RTC to have reviewed the ruling of a co-equal court.
The Court agrees with the CA. The issue of ownership and liquidation of properties
acquired during the cohabitation of Eiji and Evelyn has been submitted for the
resolution of the Makati RTC, and is pending appeal before the CA. The doctrine
of judicial stability or non-interference dictates that the assumption by the
Makati RTC over the issue operates as an insurmountable barrier to the
subsequent assumption by the Paranaque RTC.
It has been held that "even in cases of concurrent jurisdiction, it is, also,
axiomatic that the court first acquiring jurisdiction excludes the other
courts."
In addition, it is a familiar principle that when a court of competent
jurisdiction acquires jurisdiction over the subject matter of a case, its
authority continues, subject only to the appellate authority, until the matter is
finally and completely disposed of, and that no court of co-ordinate authority
is at liberty to interfere with its action. This doctrine is applicable to civil cases,
to criminal prosecutions, and to courts-martial. The principle is essential to
the proper and orderly administration of the laws; and while its observance
might be required on the grounds of judicial comity and courtesy, it does not
rest upon such considerations exclusively, but is enforced to prevent unseemly,
expensive, and dangerous conflicts of jurisdiction and of the process.
The October 2, 1996 Order, embodying Evelyns commitment not to dispose of or
encumber the property, is akin to an injunction order against the disposition or
encumbrance of the property. Jurisprudence holds that all acts done in violation of a
standing injunction order are voidable as to the party enjoined and third parties who
are not in good faith.

WHEREFORE, premises considered, the Petition is DENIED for lack of

merit. The August 1, 2006 Decision of the Court of Appeals in CA-G.R. CV No.
78944 is AFFIRMED.
53. *Adherance to jurisdiction/ Jurisdiction cannot be ousted*
LUCIA BARRAMEDA VDA. DE BALLESTEROS v. RURAL BANK
OF CANAMAN INC., THE PHILIPPINE DEPOSIT INSURANCE
CORPORATION
G.R. No. 176260 | November 24, 2010 | MENDOZA, J.:
This is a petition for review on certiorari under Rule 45 of the Revised
Rules of Civil Procedure assailing the August 15, 2006 Decision of the
Court of Appeals (CA) in CA-G.R. No. 82711, modifying the decision of the
Regional Trial Court of Iriga City, Branch 36 (RTC-Iriga), in Civil Case
No. IR-3128, by ordering the consolidation of the said civil case with
Special Proceeding Case No. M-5290 (liquidation case) before the Regional
Trial Court of Makati City, Branch 59 (RTC-Makati).
Facts:
On 2000, Lucia filed a complaint for Annulment of Deed of Extrajudicial
Partition, Deed of Mortgage and Damages with prayer for Preliminary
Injunction against her children, Roy, Rito, Amy, Arabel, Rico, Abe, Ponce
Rex and Adden, and the Rural Bank of Canaman, Inc., Baao
Branch (RBCI) before the RTC-Iriga.
Lucia alleged that her deceased husband, Eugenio, left 2 parcels of land
located in San Nicolas, Baao, Camarines Sur, each with an area of 357
square meters; that on March 6, 1995, without her knowledge and consent,
her children executed a deed of extrajudicial partition and waiver of the
estate of her husband wherein all the heirs, including Lucia, agreed to allot
the two parcels to Rico; that, still, without her knowledge and consent, Rico
mortgaged Parcel B of the estate in favor of RBCI which mortgage was
being foreclosed for failure to settle the loan secured by the lot; and that
Lucia was occupying Parcel B and had no other place to live.
RBCI claimed that in 1979, Lucia sold one of the two parcels to Rico
which represented her share in the estate of her husband.
The case was then set for pre-trial conference. During the pre-trial, RBCIs
counsel filed a motion to withdraw after being informed that Philippine
Deposit Insurance Corporation (PDIC) would handle the case as RBCI had
already been closed and placed under the receivership of the
PDIC. Consequently, on February 4, 2002, the lawyers of PDIC took over
the case of RBCI.
On May 9, 2003, RBCI, through PDIC, filed a motion to dismiss on the
ground that the RTC-Iriga has no jurisdiction over the subject matter of
the action. RBCI stated that pursuant to Section 30, Republic Act No.
7653 (RA No. 7653), otherwise known as the New Central Bank Act, the
RTC-Makati, already constituted itself, per its Order dated August 10,
2001, as the liquidation court to assist PDIC in undertaking the
liquidation of RBCI. Thus, the subject matter of Civil Case No. IR-3128
fell within the exclusive jurisdiction of such liquidation court. Lucia
opposed the motion.
On July 29, 2003, the RTC-Iriga granted the Motion to Dismiss. To which
Lucia appealed the RTC ruling to the CA on the ground that the RTC-Iriga
erred in dismissing the case because it had jurisdiction over Civil Case No.
IR-3128 under the rule on adherence of jurisdiction.
On2006 the CA rendered the questioned decision ordering the consolidation
of Civil Case No. IR-3128 and the liquidation case pending before RTC-
Makati. For The consolidation is desirable in order to prevent confusion, to
avoid multiplicity of suits and to save unnecessary cost and
expense. Needless to add, this procedure is well in accord with the principle
that the rules of procedure shall be liberally construed in order to promote
their object and to assist the parties in obtaining just, speedy and
inexpensive determination of every action and proceeding.
Lucia filed a motion for reconsideration but it was denied.
Issue:
Whether the case of Lucia can be properly consolidated with the liquidation
proceeding of the Bank in the RTC- Makati without violating the doctrine
on adherence of jurisdiction.
Ruling:
YES. The Court recognizes the doctrine on adherence of jurisdiction Such
is not without exceptions. It is well to quote the ruling of the CA on this
matter, thus: One of the exceptions is that when the change in
jurisdiction is curative in character. For sure, Section 30, R.A. 7653 is
curative in character when it declared that the liquidation court shall have
jurisdiction in the same proceedings to assist in the adjudication of the
disputed claims against the Bank.
Sec. 30. Proceedings in Receivership and Liquidation. - Whenever,
upon report of the head of the supervising or examining
department, the Monetary Board finds that a bank or quasi-bank:
(a) is unable to pay its liabilities as they become due in the
ordinary course of business: Provided, That this shall not include
inability to pay caused by extraordinary demands induced by
financial panic in the banking community;
(b) has insufficient realizable assets, as determined by the Bangko
Sentral, to meet its liabilities; or
(c) cannot continue in business without involving probable losses
to its depositors or creditors; or
(d) has wilfully violated a cease and desist order under Section 37
that has become final, involving acts or transactions which amount
to fraud or a dissipation of the assets of the institution; in which
cases, the Monetary Board may summarily and without need for
prior hearing forbid the institution from doing business in the
Philippines and designate the Philippine Deposit Insurance
Corporation as receiver of the banking institution.
In Manalo v. Court of Appeals (366 SCRA 752, [2001]), the Supreme Court
says: The requirement that all claims against the bank be pursued in the
liquidation proceedings filed by the Central Bank is intended to prevent
multiplicity of actions against the insolvent bank and designed to establish
due process and orderliness in the liquidation of the bank, to obviate the
proliferation of litigations and to avoid injustice and arbitrariness
(citing Ong v. CA, 253 SCRA 105 [1996]). The lawmaking body
contemplated that for convenience, only one court, if possible, should pass
upon the claims against the insolvent bank and that the liquidation court
should assist the Superintendents of Banks and regulate his operations
(citing Central Bank of the Philippines, et al. v. CA, et al., 163 SCRA 482
[1988]).[9]
The cited Morfe case held that after the Monetary Board has declared that a
bank is insolvent and has ordered it to cease operations, the Board becomes
the trustee of its assets for the equal benefit of all the creditors, including
depositors. The assets of the insolvent banking institution are held in trust
for the equal benefit of all creditors, and after its insolvency, one cannot
obtain an advantage or a preference over another by an attachment,
execution or otherwise.
Thus, to allow Lucias case to proceed independently of the
liquidation case, a possibility of favorable judgment and execution
thereof against the assets of RBCI would not only prejudice the other
creditors and depositors but would defeat the very purpose for which a
liquidation court was constituted as well.
In sum, this Court holds that the consolidation is proper
considering that the liquidation court has jurisdiction over Lucias action. It
would be more in keeping with law and equity if Lucias case is consolidated
with the liquidation case in order to expeditiously determine whether she is
entitled to recover the property subject of mortgage from RBCI and, if so,
how much she is entitled to receive from the remaining assets of the bank.
WHEREFORE, the petition is DENIED.
SO ORDERED.
*in this case liquidation proceeding was explained*
54. *Adherance to jurisdiction/ Jurisdiction cannot be ousted*
UNION BANK OF THE PHILIPPINES v. DANILO L. CONCEPCION
G.R. No. 160727 | June 26, 2007 | GARCIA, J.:
In this petition for review under Rule 45 of the Rules of Court,
petitioner Union Bank of the Philippines (Union Bank) assails and seeks
the setting aside of the Decision [1]dated July 22, 2003 of the Court of
Appeals (CA) in CA-G.R. SP No. 75355, as effectively reiterated in its
Resolution[2] of November 7, 2003 denying the petitioners motion for
reconsideration.
FACTS:
On September 16, 1997, the EYCO Group of Companies (EYCO or
EYCO Group) filed with the Securities and Exchange Commission
(SEC) a PETITION for the declaration of suspension of payment,
appointment of a rehabilitation receiver/committee and approval of
rehabilitation plan with an alternative prayer for liquidation and
dissolution of corporations (Petition for Suspension of Payment,
hereinafter). In it, EYCO depicted the Groups composite corporations as
having a combined asset that are more than enough to pay off all their
debts, but nonetheless unable to pay them as they fall due. Joining
EYCO as co-petitioners were Eulogio Yutingco and two other
individuals holding controlling interests in the composite corporations
(collectively, the Yutingcos).
SEC Hearing Panel, by an order of September 19, 1997, directed the
suspension of all actions, claims and proceedings against EYCO, et al.
pending before any court, tribunal, board or office[6] (the Suspension
Order). At the same time, the Panel set the petition for hearing.
Meanwhile, a consortium of private banks which had granted credit
facilities to EYCO, among them, Union Bank, convened to map out their
collective collection options. The formation of a management committee
(ManCom) to represent the creditor banks was agreed upon in that
meeting.
Subsequently, Union Bank decided to break away from the consortium
and, without notifying its members, filed a slew of civil cases against
EYCO, et al.
Of relevance is the first, a complaint for a sum of money instituted
on September 23, 1997 before the RTC-Makati, against four (4)
members of the EYCO Group and spouses Eulogio and Bee Kuan
Yutingco, as sureties of the corporate obligations, with application for
preliminary attachment. The next day, the Makati RTC issued the
desired writ of preliminary attachment, pursuant to which levy on
attachment was annotated on the titles, i.e., TCT Nos. V-48192 and V-
48193 of the Registry of Deeds of Valenzuela City, of two parcels of
land under the name of Nikon Plaza, Inc. and EYCO Properties,
Inc., respectively. Also attached, per herein respondent Danilo L.
Concepcion (Concepcion, for brevity), without denial from the
petitioner, is a parcel of land covered by TCT No. V-49678 of the same
registry allegedly held by the Yutingcos in trust for Nikon Industrial
Corporation.[11]
On October 22, 1997, Union Bank moved, on jurisdictional ground, for
the dismissal of SEC Case No. 09-97-5764. On the same date, EYCO
submitted its rehabilitation plan.
In January 1998, the SEC Hearing Panel appointed the regular members of
the newly created ManCom for EYCO.
Meanwhile, Union Bank, without awaiting for the SECs ruling on its
motion to dismiss SEC Case No. 09-97-5764, filed with the CA a petition
for certiorari to nullify what it tagged as the precipitate September 19, 1997
SEC suspension order[12] and its creation of the ManCom. In the same
petition, docketed as CA-G.R. SP No. 45774, Union Bank alleged that the
jurisdiction over the basic petition for declaration of suspension of
payment pertains to the RTC under Act No. 1956, as amended, or
the Insolvency Law.
On December 22, 1997, in CA-G.R. SP No. 45774, the CA rendered
judgment declaring Union Bank guilty of forum shopping and
accordingly dismissed its petition for certiorari. This Court, in its
Decision] dated May 19, 1998 in G.R. No. 131729, in turn affirmed that of
the CA, but proceeded further to declare the SEC as possessed of
jurisdiction over EYCOs petition for suspension of payments filed
pursuant to Section 5(d) of Presidential Decree (P.D.) No. 902-A, but
not insofar as the Yutingcos petition was concerned. With respect to the
Yutingcos, the Court held that the SECs jurisdiction on matters of
suspension of payments is confined only to those initiated by corporate
entities, as the aforecited section does not allow an individual to file, or join
in, the corresponding petition. In line with the rule on misjoinder of parties,
the Court directed the SEC to drop the individual petitioners from the
petition for suspension of payment.
Conformably with this Courts Decision aforementioned, the Makati
RTC issued, in Civil Case No. 97-2184, an Order[14] dated August 17,
1998 thereunder indefinitely suspending the proceedings in that
collection suit until further orders.
In a related development, the SEC Hearing Panel, over the objection of
the consortium of EYCOs creditor banks, approved, on December 18,
1998, the rehabilitation plan prepared by the Strategies and Alliance
Corporation for EYCO. The consortium lost no time in appealing to the
SEC en banc the Hearing Panels
approval order and prayed for the liquidation and dissolution of EYCO,
the appellate recourse docketed as SEC AC No. 649.
On September 14, 1999, the SEC en banc issued in SEC AC No. 649 an
order finding for the consortium, disposing as follows:
WHEREFORE, the appeal is, as it is hereby granted
and the Order dated 18 December 1998 is set aside.
The Petition to be Declared in State of Suspension of
Payment is hereby disapproved and the SAC Plan
terminated. Consequently, all committees,
conservator/receivers created pursuant to said Order
are dissolved. xxx
The Commission, likewise, orders the liquidation and
dissolution of the [EYCO Group]. The case is hereby
remanded to the hearing panel below for that
purpose. xxx (Words in brackets and emphasis
supplied.)
Another en banc order[15] of March 31, 2001 followed, with the SEC this
time appointing respondent Concepcion to act, vice the dissolved
Liquidation Committee, as EYCO Liquidator. Among Concepcions first
act as such liquidator was to file, on March 8, 2002, in Civil Case No.
97-2184, a Motion to Intervene and To Admit Motion to Set Aside Order
of Attachment[16] (Motion to Intervene, for brevity). Three days
later, Concepcion submitted before the SEC a Liquidation Plan[17] for the
EYCO Group.
After due proceedings, the SEC approved, on April 11, 2002, the
Concepcion-submitted Liquidation Plan.[18] Concepcions motion to
intervene, however, met a different fate. For, by Order[19] of August 8,
2002, the Makati RTC denied Concepcions motion to intervene in Civil
Case No. 97-2184 on the ground of lack of standing to intervene, his
appointment as Liquidator being, according to the court, of doubtful
validity. The order, in addition, granted Union Banks earlier motion to
declare EYCO in default, and set a date for the ex-parte reception of
Union Banks evidence.
Concepcion then moved for reconsideration questioning the basis of the
denial of his motion to intervene. Questioned, too, was the default aspect
of the order, Concepcionarguing in this regard that the collection
proceedings were suspended until further Orders from this Court [20] and
the RTC of Makati has yet to issue the suspension-lifting order. The
Makati RTC denied the motion on December 16, 2002.
Earlier, however, Union Bank presented evidence ex parte, on the basis
of which the Makati RTC rendered, on December 27, 2002, partial
judgment[21] ordering EYCO to pay the bank P400 million plus interests and
attorneys fees.

Via a petition for certiorari and prohibition before the
CA, Concepcion challenged the RTCs partial judgment aforementioned and
its earlier order denying the motion to intervene. His recourse was docketed
as CA-G.R. SP No. 75355.
The appellate court eventually issued the herein assailed
Decision[22] reversing the Makati RTCs impugned issuances and
allowing Concepcion to intervene, thus:
WHEREFORE, foregoing premises considered, the
petition is GRANTED. The assailed orders and partial
judgment are hereby ANNULLED and SET ASIDE.
Public respondent [RTC Judge Oscar Pimentel, Branch
148, Makati City] is ordered to allow petitioner
[Concepcion] to intervene in Civil Case No. 97-2184.
SO ORDERED.
Following the denial of its motion for reconsideration, [23] Union Bank has
interposed this petition ascribing to the CA the following errors:
1. In ruling in favor of respondent Concepcions right to
intervene in Civil Case No. 97-2184 pending in the lower
court despite his lack of legal interest in the matter in
litigation.
2. In ruling in favor of respondent Concepcions right to
intervene in said Civil Case No. 97-2184 despite his lack
of legal personality, his appointment by the SEC as
liquidator of EYCO being null and void for lack of
jurisdiction; and
3. In giving due course to respondent Concepcions petition
for certiorari under Rule 65 of the 1997 Rules of Civil
Procedure despite its being the improper remedy.
We DENY.
As the Court distinctly notes, the petitioner does not assail the CAs judgment
insofar as it nullified the RTCs partial judgment or its default order. As thus
couched, the petition particularly sets its sight on that part of the appellate
courts ruling allowing respondent Concepcion to intervene in Civil Case No.
97-2184. Of the three errors assigned, the more critical relates to the
challenged validity of the respondents appointment by the SEC as liquidator
of the EYCO Group, his right to intervene predicated as it is on his being
such liquidator.
It is the petitioners posture, following the Makati RTCs line, that the
respondents appointment as liquidator of EYCO was invalid for lack of
jurisdiction on the part of SEC to preside, in first place, over EYCOs
liquidation and dissolution. Pressing on, the petitioner states that EYCO is
already insolvent and insolvency proceedings fall under the jurisdiction of
regular courts under the Insolvency Law (Act No. 1956, as amended) in
relation to the pertinent provision of R.A. No. 8799, otherwise
known as the Securities Regulation Code.
We are not persuaded.
As it were, the underlying petition[24] EYCO filed with and
over which the SEC assumed jurisdiction was one for declaration of
suspension of payment, appointment of a rehabilitation
receiver/committee, approval of rehabilitation plan with alternative
prayer for liquidation and dissolution. That the SEC, along the way,
ordained EYCOs liquidation and dissolution did not, without more, strip
the SEC of jurisdiction over the liquidation process. Albeit jurisdiction
over a petition to declare a corporation in a state of insolvency strictly
lies with regular courts, the SEC possessed, during the period material,
ample power under P.D. No. 902-A,[25] as amended, to declare a
corporation insolvent as an incident of and in continuation of its already
acquired jurisdiction over the petition to be declared in the state of
suspension of payments in the two instances provided in Section 5(d)
thereof.[26] Said Section 5(d)[27] vests the SEC with exclusive and original
jurisdiction over petitions for suspension of payments which may either
be: (a) a simple petition for suspension of payments based on the
provisions of the Insolvency Law, i.e., the petitioning corporation has
sufficient assets to cover all its debts, but foresees the impossibility of
meeting the obligations as they fall due, or (b) a similar petition filed by
an insolvent corporation accompanied by a prayer for the creation of a
management committee and/or rehabilitation receiver based on the
provisions of P.D. No. 902-A, as amended by P.D. No. 1758.[28]
In the case at bench, EYCOs petition for suspension of payment was, at
bottom, a mix of both situations adverted to above. For, while EYCO, in the
said petition, alleged being solvent but illiquid, it nonetheless pleaded for the
constitution of a rehabilitation receiver/committee, with an alternative prayer
for liquidation, if warranted. Clearly then, the SEC has, from the start,
jurisdiction over EYCOs petition for suspension of payment, such
jurisdiction, following Ching,[29] continuing for purposes of liquidation after
it (SEC) declared EYCO insolvent. The SEC appeared to be aware of the
continuity angle as it even ordered the remand to the SEC Hearing Panel of
SEC Case No. 09-97-5764 for purposes of liquidating and dissolving the
EYCO Group.
If the SEC contextually retained jurisdiction over the liquidation of EYCO,
is it not but logical then that it has competence to appoint the respondent or
any qualified individual for that matter as liquidator?
And lest it be overlooked, the Court had, in G.R. No. 131729, already
rejected the petitioners thesis about the SECs purported lack of jurisdiction
over EYCOs suspension of payment case owing to its supervening
insolvency. Therein, the Court stated:
We are of course aware of the argument [of] petitioner
[Union Bank] that the petition of [EYCO] should be
entirely dismissed and taken out of the SECs jurisdiction
on account of the alleged insolvency of [the latter]. In
this regard, petitioner theorizes that [EYCO has] already
become insolvent when [the composite corporations]
allegedly disposed of a substantial portion of their
properties hence suspension of payments with the SEC is
not the proper remedy.
Such argument does not persuade us. Petitioners
allegations of [EYCOs] supposed insolvency are
hardly of any consequence to the assumption of
jurisdiction by the SEC over the nature or subject
matter of the petition for suspension of payments. Aside
from the fact that these allegations are evidentiary in
nature , we have likewise consistently ruled that what
determines the nature of an action, as well as which court
or body has jurisdiction over it, are the allegations of the
complaint, or a petition as in this case, and the character
of the relief sought. That the merits of the case after
due proceedings are later found to veer away from the
claims asserted by EYCO in its petition, as when it is
shown later that it is actually insolvent and may not
be entitled to suspension of payments, does not divest
the SEC at all of its jurisdiction already acquired as
its inception . (Words in brackets and emphasis added.)
The Court is certainly aware of the transfer, effected by R.A. No. 8799, to
the RTC of the SECs jurisdiction defined under Section 5(d) of P.D. No. 902-
A.[30] Such transfer, however, did not, as the petitioner and the RTC posit,
divest the SEC of its jurisdiction over SEC Case No. 09-97-5764, given that
it had already issued, as early as September 19, 1998, the suspension order
after it found the petition for suspension filed on September 16, 1998 to be
sufficient in form and substance. Subsection 5.2 of R.A. No. 8799
prescribing the jurisdiction transfer and the rules on transition provides as
follows:
5.2. The [Securities and Exchange] Commissions
jurisdiction over all cases enumerated under Section
5 of [P.D.] No. 902-A is hereby transferred to the
appropriate [RTC]: Provided that the Supreme Court
may designate the [RTC] branches that shall exercise
jurisdiction over these cases. xxx The Commission
shall retain jurisdiction over pending suspension
of payments/rehabilitation cases filed as of 30
June 2000 until finally disposed. (Words in bracket
and emphasis added.)
EYCOs petition for suspension for payment was, for all intents and
purposes, still pending with the SEC as of June 30, 2000. Accordingly,
the SECs jurisdiction thereon, by the express terms of R.A. No. 8999,
still subsists until [the suspension of payment case and its incidents
are] finally disposed. In the words of the CA:
As held by this Court Section 5.2 of RA 8799
specifically provided that the SEC shall retain
jurisdiction over pending suspension of
payments/rehabilitation cases filed as of June 30,
2000until finally disposed. The records are clear that
the suspension of payment was filed on September 7,
1998. As such, the petition is still pending with the
SEC as of the cut-off date set in the rules. xxx[31]
When the law speaks of until finally disposed, the reference should
include the final disposition of the liquidation and dissolution processes
since it is within the power of the SEC by law, [32] or as incident of or in
continuation of its already acquired jurisdiction over the petition for
suspension of payment,[33] to order the dissolution/liquidation of a
corporation and accordingly appoint a liquidator. In fine, the continuing
exercise of jurisdiction by the SEC over the liquidation and dissolution
of the EYCO Group is warranted. Once jurisdiction attaches, the court
cannot be ousted from the case by any subsequent events, such as a new
legislation placing such proceedings under the jurisdiction of another
body. The only recognized exceptions to the rule, which find no sway in
the present case, arise when the statute expressly so provides or when
the statute is clearly intended to apply to actions pending before its
enactment.[34]
Given the above perspective, the Court is at a loss to understand
petitioners challenge against the right of the respondent to intervene in
Civil Case No. 97-2184, on the postulate that the latter lacks legal
interest in the matter in litigation.
Intervention is a procedure by which a third person, not originally party
to the suit, but claiming an interest in the subject matter, comes into the
case, in order to protect his right or interpose his claim. [35] Its main
purpose is to settle in one action and by a single judgment all conflicting
claims of or the whole controversy among the persons involved. [36] To
warrant intervention under Rule 19, Section 1 of the Rules of Court,
[37]
two requisites must concur: (a) the movant has a legal interest in the
matter in litigation, and (b) intervention must not unduly delay
or prejudice the adjudication of the rights of the parties, nor should the
claim of the intervenor be capable of being properly decided in a
separate proceeding. The interest, which entitles one to intervene, must
involve the matter in litigation and of such direct and immediate
character[38]that the intervenor will either gain or lose by the direct legal
operation and effect of the judgment.[39]
Just like the CA, the Court has no doubt about the respondent, as the
duly-appointed liquidator of EYCOs remaining assets, having a legal
interest in the matter litigated in Civil Case No. 97-2184. This is
particularly true with respect to the parcels of land covered by the writ
of attachment which, in the implementation of the SEC-approved
Liquidation Plan for EYCO, had been conveyed to the respondent [40] in
trust for the benefit of creditors, EYCOs stockholders and other persons
in interest. At the very least, the respondent, as liquidator-trustee, is so
situated as to be affected by the distribution or disposition of the
attached properties which were under threat of being levied on execution
and sold at public auction. Respondent would be unfaithful to his trust if
he does take a bona fide effort to intervene in Civil Case No. 97-2184 to
thwart the attempt of the petitioner to collect unpaid loans ahead of other
legitimate creditors similarly situated. Under the SEC Rules of
Procedure on Corporate Recovery pursuant to which the SEC appointed
the respondent to liquidate the remaining assets of EYCO, the liquidator
is empowered and duty bound to [R]epresent the debtor in any case
filed by or against the debtor in any tribunal and [B]ring any action on
behalf of the debtor to collect, recover or preserve any of its assets, or to
resist or defend against any claim.[41]
Any suggestion that allowing intervention would unduly
delay the final closure of the collection case cannot be accepted. Far
from unnecessarily prolonging or complicating the case, the desired
intervention, if allowed, would possibly enable the court in one single
action and judgment to protect the collective interests of the creditors of
the EYCO Group that are seriously threatened by the imminent
exclusion of certain properties from the pool of assets that should
legally, if not ideally, be equitably distributed among them. Disallowing
intervention would pave the way for the petitioner to seize the
proceedings before the Makati RTC to work entirely in its favor. Such
course of action trifles with the entire liquidation process. And any
decision rendered therein would unlikely be left undisturbed by other
legitimate but unpaid creditors whose interest in the attached properties
can hardly be disputed.
Moreover, the claim of the respondent over the attached properties could
not possibly be better threshed out in a separate but subsequent
proceedings given that he had already secured titles over them.
The third and last issue turns on the propriety of certiorari as a
recourse to the denial of a motion for intervention. The correct remedy,
according to the petitioner, is an appeal under Rule 45 of the Rules of
Court, an order denying intervention being final in character, not merely
interlocutory. Petitioner thus faults the CA for allowing respondent
Concepcions petition for certiorari under Rule 65 of the Rules as a
vehicle to impugn the denial of his motion for intervention. It stresses
that the availability of appeal proscribes recourse to the special civil
action of certiorari.
We are not convinced.
Petitioners statement of the rule on the availability of the extraordinary
writ of certiorari under the premises is impeccable. So too is its citation
of supporting jurisprudence. Petitioner conveniently forgot, however, to
include in its formulation settled exceptions to and qualifications of the
rule, even as it glossed over another holding that intervention is merely
accessory to the principal action and, as such, is an interlocutory
proceeding dependent on the case between the original parties.[42]
It is true that certiorari may not be resorted to when appeal is available
as a remedy. However, it is also true that the Court has allowed the
issuance of a writ of certiorari when appeal does not afford a speedy and
adequate remedy in the ordinary course of law. As in the past, the Court
has ruled that the availability of an appeal does not foreclose recourse to
the ordinary remedies or certiorari or prohibition where appeal is not
adequate, equally beneficial, expeditious and sufficient. [43] Stated a bit
differently, certiorarimay be availed of where an appeal would be slow,
inadequate and insufficient. The determination as to what exactly
constitutes plain, speedy and adequate remedy rests on judicial
discretion and depends on the particular circumstances of each case.
In the case at bar, the CA did not commit any reversible error in
allowing the petition for certiorari filed by the respondent. As it were,
the respondent was able to convince the CA of the urgency of his cause
and that an appeal from the denial of the motion for intervention would
not constitute speedy and adequate remedy, thus necessitating the resort
to the extraordinary remedy of certiorari. And in an instance justifying
the invocation of the remedy of certiorari, it would appear too that the
CA found the RTC to have exercised its judicial authority in an
oppressive manner,[44] so much so that the CA stated the apt observation
that: In the first place, it [RTC] should not have taken cognizance of the
case when it was notified of the pending petition [for suspension of
payments] before the SEC at the time the complaint was filed.[45]
Certainly not lost on the Court is an obvious reality: the Makati RTC
virtually interfered with and invalidated the appointment made by the
SEC when it has no jurisdiction over the latter.
WHEREFORE, the instant petition is DENIED and the impugned
Decision and Resolution of the Court of Appeals dated July 22,
2003 and November 7, 2003, respectively, are AFFIRMED.

Costs against the petitioner.

SO ORDERED.
55. *Adherance to jurisdiction/ Jurisdiction cannot be ousted*
APO CEMENT CORPORATION vs. MINGSON MINING
INDUSTRIES CORPORATION
PERLAS-BERNABE,J. | G.R. No. 206728 | November 12, 2014
Assailed in this petition for review on certiorari are the Decision dated
June 13, 2012 and the Resolution dated April 23, 2013 of the Court of
Appeals (CA) in CA-G.R. SP No. 100456 which affirmed the Decision dated
July 31, 2007 of the Department of Environment and Natural Resources
(DENR) Mines Adjudication Board (MAB) in MAB Case No. 02-96 (POA
Case No. CEB-001 ).
Facts:
The instant case arose from a dispute involving the mining claims known as
"Allied 1 and 2" and "Lapulapu 31 and 32" (subject mining claims) between
petitioner Apo Cement Corporation (Apocemco) and respondent Mingson
Mining Industries Corporation (Mingson).
For the supposed failure of the old locators to develop and put to productive
use the mineral properties found in the area, Apocemco submitted a Mineral
Production Sharing Agreement (MPSA) proposal on June 19, 1991 before
the DENR, essentially seeking to take over their current holder, Luvimin
Cebu Mining Corporation (Luvimin).
On August 18, 1992 and March 2, 1993, the DENR Regional Office
declared the subject mining claims, among others, abandoned and open for
location to other interested parties, prompting Luvimin to file an
appeal. Similarly, Mingson assailed the aforementioned declarations on the
ground that its own mining claims, i.e., "Yellow Eagle I to VII," overlapped
with the subject mining claims. Particularly, Mingson averred that its
"Yellow Eagle IV" claim was registered on February 7, 1983 and was found
to have overlapped with the "Allied 1 and 2" claims, while its "Yellow
Eagle III" claim was registered on April 12, 1982 and overlapped with
the "Lapulapu 31 and 32" claims.
The DENR Regional Office decreed that portions of the subject mining
claims be awarded to Mingson, considering that said claims have
encroached its Yellow Eagle I to VII claims.
However, upon Apocemco’s motion for reconsideration, the DENR
Regional Office’s Legal Division issued a Resolution, recommending that
the subject mining claims be awarded, instead, to Apocemco, subject,
however, to the outcome of Luvimin’s appeal. In a subsequent Order, the
DENR Regional Director affirmed the foregoing resolution, but subject to
the review and concurrence of the Mines and Geosciences Bureau Region 7
- Panel of Arbitrators (POA), considering that pursuant to Section 218 of
DENR Department Administrative Order No. (DAO) 95-23, Series of
1995, the POA has been mandated to resolve, among others, disputes
involving rights to mining areas.
In a Decision, the POA upheld the Resolution and the Order, reiterating the
findings therein made, without, however, requiring the parties to file any
pleading or setting the matter for hearing.
Aggrieved, Mingson appealed the POA’s Decision before the DENR MAB,
averring that the said Decision was not supported by facts and the evidence
on record, and that it was arbitrary and issued with grave abuse of authority.
Subsequently, in Mingson’s letter dated August 8, 1996, it claimed denial of
due process.
In a Decision dated July 31, 2007, the DENR MAB granted Mingson’s
appeal and thereby reversed and set aside the POA’s Decision. It found
that the POA merely conducted a review of the case and Mingson, in
particular, was not given an opportunity to be heard, which is repugnant to
due process.
Apocema appealed to the CA.
In a Decision dated June 13, 2012, the CA dismissed Apocemco’s appeal
and sustained the DENR MAB’s finding that Mingson was not afforded
by the POA its right to due process, given that none of the applicable
procedures found in DENR DAO 95-23 were followed. As an added ground
for dismissal, the CA held that Apocemco failed to perfect its appeal in
accordance with the Rules of Court, considering that the DENR MAB was
not served a copy of its petition.
Unconvinced, Apocemco filed a motion for reconsideration which was,
however, denied in a Resolution dated April 23, 2013. Hence the petition.
Issue:
Whether the CA correctly ordered the dismissal of Apocemco’s appeal.
Besides, an apparent lack of due process may be raised by a party at any
time since due process is a jurisdictional requisite that all tribunals, whether
administrative or judicial, are duty bound to observe.
In Salva v. Valle,43 the Court pronounced that "[a]decision rendered without
due process is void ab initio and may be attacked at any time directly or
collaterally by means of a separate action, or by resisting such decision
in any action or proceeding where it is invoked." The Court sees no
defensible reason as to why this principle should not be herein applied.

Ruling:
Yes. It has been established thatthe POA proceeded to resolve the present
mining dispute without affording either party any fair and reasonable
opportunity to be heard in violation of the aforementioned provisions of
DENR DAO 95-23. Thus, as correctly ruled by the DENR MAB and later
affirmed by the CA, Mingson’s due process rights were violated, thereby
rendering the POA’s Decision null and void.
That being said, and considering too Apocemco’s failure to comply with
Sections 5 and 7, Rule 43 of the Rules of Court in the proceedings before
the appellate court, the instant petition is hereby denied and the rulings of
the CA are affirmed.
WHEREFORE, the petition is DENIED. The Decision dated June 13, 2012
and the Resolution dated April 23, 2013 of the Court of Appeals in CA-G.R.
SP No. 100456 are hereby AFFIRMED.

Sections 223 (on preliminary conference), 224 (on hearing), and 227 (on the
proceedings before the POA), as well as Sections 221 (on due course) and
222 (on answers) of DENR DAO95-23, or the Implementing Rules of the
Philippine Mining Act of 1995, clearly require that the parties involved in
mining disputes be given the opportunity to be heard. These rules – which
were already in effect during the time the dispute between the parties arose
– flesh out the core requirement of due process; thus, a stark and unjustified
contravention of the same would oust the errant tribunal of its jurisdiction
and, in effect, render its decision null and void. As explained in PO2
Montoya v. Police Director Varilla:

The cardinal precept is that where there is a violation of basic constitutional

rights, courts are ousted from their jurisdiction. The violation of a party’s
right to due process raises a serious jurisdictional issue which cannot be
glossed over or disregarded at will. Where the denial of the fundamental
right of due process is apparent, a decision rendered in disregard of that
right is void for lack of jurisdiction.
56. *effect of lack of jurisdiction*
LAND BANK OF THE PHILIPPINES vs. SPOUSES PLACIDO and
CLARA DY ORILLA
G.R. No. 194168 | February 13, 2013 | PERALTA, J.:
This is a petition for revievv on certiorari assailing the Decision dated April
17, 2009 of the Court of Appeals (CA) in CA-G.R. CV No. 70071, and the
Resolution dated Septernber 30, 2010 denying petitioner's Motion for
Partial Reconsideration.
Facts:
Respondents spouses Placido and Clara Orilla were the owners of a parcel
of land situated in Bohol, identified as Lot No. 1, 11-12706, containing an
area of 23.3416 hectares and covered by Transfer Certificate of Title No.
18401.
In November 1996, the Department of Agrarian Reform Provincial Agrarian
Reform Office (DARPARO) of Bohol sent respondents a Notice of Land
Valuation and Acquisition dated November 15, 1996 informing them of
the compulsory acquisition of 21.1289 hectares of their landholdings
pursuant to the C.A.R.L1 (R.A.6657) for ₱371,154.99 as compensation
based on the valuation made by petitioner Land Bank of the Philippines
(LBP).
However, respondents rejected the said valuation. Consequently, a summary
hearing was conducted by the Provincial Department of Agrarian Reform
Adjudication Board (Provincial DARAB) to determine the amount of just
compensation. After the proceedings, the Provincial DARAB affirmed the
valuation made by the petitioner.
Not content with the decision, respondents filed an action for the
determination of just compensation before the Regional Trial Court of
1 COMPREHENSIVE AGRARIAN REFORM LAW
Tagbilaran City sitting as a Special Agrarian Court (SAC). The case was
docketed as Civil Case No. 608.
After trial on the merits, the SAC rendered a Decision Fixing the just
compensation of the land of petitioner subject matter of the instant action at
₱7.00 per square meter, which shall earn legal interest from the filing of the
complaint until the same shall have been fully paid.
LBP filed a Notice of Appeal. Subsequently, Spouses Orilla filed a Motion
for Execution Pending Appeal, pursuant to Section 2, Rule 39 of the 1997
Rules of Civil Procedure and the consolidated cases of Landbank of the
Philippines v. Court of Appeals, et al. and Department of Agrarian Reform
v. Court of Appeals, et al. Respondents argued that the total amount of
₱1,479,023.00, which is equivalent to ₱7.00 per square meter for 21.1289
hectares, adjudged by the SAC as just compensation, could then be
withdrawn under the authority of the aforementioned case.
On December 21, 2000, the SAC issued an Order granting the Motion for
Execution Pending Appeal, petitioners are hereby ordered to post bond
equivalent to one-half of the amount due them by virtue of the decision in
this case. The respondent Land Bank of the Philippines, is therefore,
ordered to immediately deposit with any accessible bank, as may be
designated by respondent DAR, in cash or in any governmental financial
instrument the total amount due the petitioner spouses as may be computed
within the parameters of Sec. 18(1) of RA 6657. Furthermore, pursuant to
the Supreme Court decisions in "Landbank of the Philippines vs. Court of
Appeals, et al." G.R. No. 118712, promulgated on October 6, 1995 and
"Department of Agrarian Reform vs. Court of Appeals, et al.," G.R. No.
118745, promulgated on October 6, 1995, the petitioners may withdraw the
same for their use and benefit consequent to their right of ownership
thereof.
On December 25, 2000, respondents filed a Motion for Partial
Reconsideration of the amount of the bond to be posted, but it was later
denied in an Order dated January 11, 2001.
For its part, petitioner filed a Motion for Reconsideration, which was
likewise denied in an Order dated December 29, 2000.12
On March 13, 2001, petitioner filed with the CA a special civil action
for certiorari and prohibition under Rule 65 of the Rules of Court with
prayer for issuance of a temporary restraining order and/or preliminary
injunction. It questioned the propriety of the SAC Order granting the
execution pending appeal.13
In its Decision dated July 29, 2002, the CA dismissed the petition on the
ground that the assailed SAC Order dated December 21, 2000 granting
execution pending appeal was consistent with justice, fairness, and equity,
as respondents had been deprived of the use and possession of their
property, pursuant to RA 6657 and are entitled to be immediately
compensated with the amount as determined by the SAC under the principle
of "prompt payment" of just compensation. Petitioner filed a Motion for
Reconsideration, but it was denied.14
Petitioner then sought recourse before this Court in a petition docketed as
G.R. No. 157206.1âwphi1 After due proceedings, this Court rendered a
Decision15 dated June 27, 2008, affirming the decision of the CA. The
decretal portion reads:
WHEREFORE, the Decision of the Court of Appeals, dated July 29, 2002,
is AFFIRMED.16
Petitioner filed a Motion for Reconsideration, but was denied with finality
by the Court.
Meanwhile, in CA-G.R. CV No. 70071, the CA rendered a Decision 17 dated
April 17, 2009, granting the appeal filed by the petitioner. The dispositive
portion reads:
WHEREFORE, premises considered, the instant appeal is GRANTED. The
assailed decision of the Regional Trial Court sitting as Special Agrarian
Court is hereby SET ASIDE.
This case is REMANDED to the trial court for the proper determination of
just compensation for the land taken.
SO ORDERED.18
The CA held that there was no valid and sufficient legal basis for the SAC
in fixing the just compensation for the subject property at ₱1,479,023.00.
Thus, the CA remanded the case to the SAC for the proper determination of
just compensation.
In disposing the case, the CA also took into consideration the Motion for
Execution Pending Appeal that was granted earlier by the SAC and affirmed
by the CA and this Court, to wit:
Finally, the petitioners-appellees filed a Manifestation for Early Resolution
before this Court revealing that the petitioners-appellees filed before the
SAC a motion for execution pending appeal which was granted. This Court
affirmed the decision of the SAC. Ultimately, the Supreme Court affirmed
the decision of the Court of Appeals. Therefore, should the SAC find upon
recomputation that the just compensation previously rendered is bigger than
the recomputed value, the petitioners-appellees are ordered to return the
excess considering that payment may already have been given by LBP in
pursuant to the finality of the motion for execution pending appeal.19
Unsatisfied, petitioner filed a Motion for Partial
Reconsideration.20 Petitioner argued that when the CA set aside the
valuation of the SAC amounting to ₱1,479,023.00, it necessarily follows
that said amount can no longer be the subject of an execution pending
appeal. Petitioner theorized that by annulling the SAC decision and,
consequently, remanding the case to the trial court, the latter’s decision was
voided and, therefore, it could no longer be executed.
On September 30, 2010, the CA issued a Resolution21 denying the motion.
The CA held that the issue of the validity of the writ of execution was
already resolved by the Supreme Court with finality in G.R. No. 157206.
That was precisely the reason why it stated in the decision that "should the
SAC find upon recomputation that the just compensation previously
rendered is bigger than the recomputed value, the petitioners-appellees are
ordered to return the excess, considering that payment may already have
been given by the LBP in pursuant to the finality of the motion for
execution pending appeal."22
Hence, the petition assigning the lone error:
THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS
ERROR OF LAW IN HOLDING THAT THE TRIAL COURT’S
DECISION, WHICH WAS ANNULLED AND SET ASIDE, CAN STILL
BE THE SUBJECT OF EXECUTION.23
Petitioner argues that when the CA set aside the valuation of the SAC, it
necessarily means that such valuation can no longer be the subject of an
execution pending appeal. It adds that the writ of execution ordering the
LBP to pay respondents the amount of ₱1,479,023.00 remains
unimplemented as of the time the CA rendered the decision annulling the
aforesaid valuation.
Petitioner posits that once a decision is annulled or set aside, it is rendered
without legal effect for being a void judgment. Petitioner maintains that
while the issue of the validity of the writ of execution issued by the SAC
had been upheld by this Court in G.R. No. 157206, the enforcement of the
writ had been rendered moot and academic after the decision of the SAC
was reversed and set aside by the CA.
On their part, respondents contend that having attained finality, the decision
of this Court in G.R. No. 157206 could no longer be disturbed. Moreover,
the reason advanced by the CA in denying the motion for partial
reconsideration was merely an affirmation of the decision of this Court in
the said case.
The petition is without merit.
At the onset, it should be noted that although this Court, in Land Bank of
the Philippines v. Orilla,24 held that the SAC validly issued the Order
granting execution pending appeal in the exercise of its sound discretion in
issuing the same according to the Rules, still what this Court deemed was
justified in that particular case was the propriety of the issuance of the said
Order and not the amount of monetary award that respondents were entitled
which, in turn, corresponds to the valuation of the subject property as
determined by the SAC in its Decision. Thus, this Court stated in the said
case that "while this decision does not finally resolve the propriety of the
determination of just compensation by the SAC in view of the separate
appeal on the matter, we find no grave abuse of discretion on the part of the
SAC Judge in allowing execution pending appeal."25
Anent the present controversy, in its Decision annulling the SAC valuation,
the CA opined:
x x x In granting the award, the SAC merely granted the amount prayed for
by the spouses and did not provide any computation or explanation on how
it arrived at the amount. There was therefore no valid and sufficient legal
basis for the award.26
The CA, therefore, concluded that there was no sufficient legal basis for the
valuation arrived at by the SAC in the amount of ₱1,479,023.00. In fine, the
CA effectively set aside and voided the Decision of the RTC fixing the
amount of just compensation for the subject property. As correctly argued
by petitioner, being the fruit of a void judgment such amount cannot be the
proper subject of the Order granting the motion for execution pending
appeal issued by the SAC.
A void judgment or order has no legal and binding effect, force or efficacy
for any purpose. In contemplation of law, it is non-existent. Such judgment
or order may be resisted in any action or proceeding whenever it is
involved. It is not even necessary to take any steps to vacate or avoid a void
judgment or final order; it may simply be ignored.27
In Metropolitan Waterworks & Sewerage System v. Sison,28 this Court held
that:
x x x "A void judgment is not entitled to the respect accorded to a valid
judgment, but may be entirely disregarded or declared inoperative by any
tribunal in which effect is sought to be given to it. It is attended by none of
the consequences of a valid adjudication. It has no legal or binding effect or
efficacy for any purpose or at any place. It cannot affect, impair or create
rights. It is not entitled to enforcement and is, ordinarily, no protection to
those who seek to enforce. All proceedings founded on the void judgment
are themselves regarded as invalid. In other words, a void judgment is
regarded as a nullity, and the situation is the same as it would be if there
were no judgments. It, accordingly, leaves the parties litigants in the same
position they were in before the trial."29
Accordingly, a void judgment is no judgment at all. It cannot be the source
of any right nor of any obligation. All acts performed pursuant to it and all
claims emanating from it have no legal effect. Hence, it can never become
final, and any writ of execution based on it is void: "x x x it may be said to
be a lawless thing which can be treated as an outlaw and slain at sight, or
ignored wherever and whenever it exhibits its head."30
As correctly maintained by petitioner, since the valuation made by the SAC
in its Decision dated November 20, 2000 having been annulled by the CA
for its lack of sufficient and legal basis, the void judgment can never be
validly executed.
Nevertheless, it must be pointed out that the situation contemplated by the
CA in the assailed Decision was one wherein payment has already been
made by petitioner to the respondents during the pendency of the appeal.
Nowhere in the disquisition of the CA can it be inferred that it is enjoining
the LBP to enforce the writ of execution in accordance with the valuation
made by the SAC. On the contrary, the CA respected the finality of the
motion for execution pending appeal should the same have already been
enforced. As pronounced by the CA:
x x x Therefore, should the SAC find upon computation that the just
compensation previously rendered is bigger than the recomputed value, the
petitioners-appellees are ordered to return the excess considering that
payment may already have been given by LBP in pursuant to the finality of
the motion for execution pending appeal.31
Verily, it appears that the writ of execution pending appeal remains
unimplemented as of the time the CA rendered its decision annulling the
valuation made by the SAC. The monetary award having emanated from a
void valuation, it follows that the writ of execution pending appeal cannot
be properly implemented. As contemplated by the CA, the situation would
have been different if the writ was already enforced during the pendency of
the appeal, for at that time the writ could still be validly enforced since the
valuation made by the SAC still stands. Necessarily, as directed by the CA, prejudice to the recomputation of the just compensation for the subject land
any excess amount paid to respondents should be returned to petitioner. by the Regional Trial Court.
Nonetheless, the amount of ₱371,154.99 representing the compensation SO ORDERED.
offered by the petitioner for the land taken, can still be properly awarded to
respondents in accordance with Land Bank of the Philippines v. Court of
Appeals.32In the said case, the Court allowed the release of the offered
compensation to the landowner pending the determination of the final
valuation of their properties. The Court opined that:
We are not persuaded. As an exercise of police power, the expropriation of
private property under the CARP puts the landowner, and not the
government, in a situation where the odds are already stacked against his
favor. He has no recourse but to allow it. His only consolation is that he can
negotiate for the amount of compensation to be paid for the expropriated
property. As expected, the landowner will exercise this right to the hilt, but
subject however to the limitation that he can only be entitled to a "just
compensation." Clearly therefore, by rejecting and disputing the valuation
of the DAR, the landowner is merely exercising his right to seek just
compensation. If we are to affirm the withholding of the release of the
offered compensation despite depriving the landowner of the possession and
use of his property, we are in effect penalizing the latter for simply
exercising a right afforded to him by law.33
Of course, this is without prejudice to the outcome of the case which was
remanded to the SAC for recomputation of just compensation. Should the
SAC find the said valuation too low and determine a higher valuation for
the subject property, petitioner should pay respondents the difference.
Conversely, should the SAC determine that the valuation was too high,
respondents should return the excess. To be sure, the concept of just
compensation embraces not only the correct determination of the amount to
be paid to the owners of the land, but also payment within a reasonable time
from its taking. Without prompt payment, compensation cannot be
considered "just" inasmuch as the property owner is made to suffer the
consequences of being immediately deprived of his land while being made
to wait for a decade or more before actually receiving the amount necessary
to cope with his loss.34
WHEREFORE, subject to the foregoing disquisitions, the Decision and
Resolution of the Court of Appeals, dated April 17, 2009 and September 30,
2010, respectively, in CA-G.R. CV No. 70071, are AFFIRMED. Petitioner
Land Bank of the Philippines is ORDERED to release the amount
of ₱3 71,154.99 to respondents spouses Placido and Clara Orilla, without