Lim Tanhu vs. Ramolete LIM TANHU v. HON. JOSE R.

RAMOLETE
66 SCRA 425 G.R. No. L-40098; August 29, 1975
FACTS: Ponente: J. Barredo

Private respondent Tan Put alleged that she is the widow of Tee Hoon Lim Po Chuan, who was a
partner and practically the owner who has controlling interest of Glory Commercial Company and a FACTS:
Chinese Citizen until his death. Defendant Antonio Lim Tanhu and Alfonso Leonardo Ng Sua were
partners in name but they were mere employees of Po Chuan and were naturalized Filipino Citizens.
Tan Put filed complaint against spouses-petitoner Lim Tanhu and Dy Ochay including their son Tech Tan alleged that she is the widow of Tee Hoon Lim Po Chuan, who was a partner in the commercial
Chuan and the other spouses-petitoner Ng Sua and Co Oyo including also their son Eng Chong partnership, Glory Commercial Company with Antonio Lim Tanhu and Alfonso Ng Sua".
Leonardo, that through fraud and machination took actual and active management of the partnership
and that she alleged entitlement to share not only in the capital and profits of the partnership but also Defendant Antonio Lim Tanhu, Alfonso Leonardo Ng Sua, Lim Teck Chuan, and Eng Chong Leonardo,
in the other assets, both real and personal, acquired by the partnership with funds of the latter during
through fraud and machination, took actual and active management of the partnership and although Tee
its lifetime."
According to the petitioners, Ang Siok Tin is the legitimate wife, still living, and with whom Tee Hoon Hoon Lim Po Chuan was the manager of Glory Commercial Company, defendants managed to use the
had four legitimate children, a twin born in 1942, and two others born in 1949 and 1965, all presently funds of the partnership to purchase lands and buildings in the cities of Cebu, Lapulapu, Mandaue, and
residing in Hong Kong. Tee Hoon died in 1966 and as a result of which the partnership was dissolved the municipalities of Talisay and Minglanilla.
and what corresponded to him were all given to his legitimate wife and children.

Tan Put prior of her alleged marriage with Tee Hoon on 1949, was engaged in the drugstore business;
that not long after her marriage, upon the suggestion of the latter sold her drugstore for P125,000.00
which amount she gave to her husband as investment in Glory Commercial Co. sometime in 1950; that
after the investment of the above-stated amount in the partnership its business flourished and it
embarked in the import business and also engaged in the wholesale and retail trade of cement and GI
sheets and under huge profits.
Defendants interpose that Tan Put knew and was are that she was merely the common-law wife of Tee
Hoon. Tan Put and Tee Hoon were childless but the former had a foster child, Antonio Nunez.
ISSUE: Whether Tan Put, as she alleged being married with Tee Hoon, can claim from the company of
the latter’s share.
HELD:
She alleged in her complaint that after the death of Tee Hoon Lim Po Chuan, the defendants, without
liquidation, continued the business of Glory Commercial Company, by purportedly organizing a
corporation known as the Glory Commercial Company, Incorporated and sometime in the month of
November, 1967, defendants, particularly Antonio Lim Tanhu, by means of fraud deceit, and
misrepresentations did then and there, induce and convince her to execute a quitclaim of all her rights
and interests, in the assets of the partnership of Glory Commercial Company.
Thereafter, in the year 1968-69, the defendants who had earlier promised to liquidate the aforesaid
properties and assets in favor, among others of plaintiff and until the middle of the year 1970 when the
plaintiff formally demanded from the defendants the accounting of real and personal properties of the
Glory Commercial Company, defendants refused and stated that they would not give the share of the
plaintiff.

Under Article 55 of the Civil Code, “the declaration of the contracting parties that they take each other ISSUE:
as husband and wife "shall be set forth in an instrument" signed by the parties as well as by their
witnesses and the person solemnizing the marriage. Accordingly, the primary evidence of a marriage
Whether Tan has a right over the liquidated properties of the partnership
must be an authentic copy of the marriage contract”. While a marriage may also be proved by other
competent evidence, the absence of the contract must first be satisfactorily explained. Surely, the HELD:
certification of the person who allegedly solemnized a marriage is not admissible evidence of such
marriage unless proof of loss of the contract or of any other satisfactory reason for its non-production No, Tan has no right over the liquidated properties of the partnership
is first presented to the court. In the case at bar, the purported certification issued by a Mons. Jose M.
Recoleto, Bishop, Philippine Independent Church, Cebu City, is not, therefore, competent evidence,
there being absolutely no showing as to unavailability of the marriage contract and, indeed, as to the The Supreme Court held that there is no alternative but to hold that plaintiff Tan Put's allegation that
authenticity of the signature of said certifier, the jurat allegedly signed by a second assistant she is the widow of Tee Hoon Lim Po Chuan has not been satisfactorily established and that, on the
provincial fiscal not being authorized by law, since it is not part of the functions of his office. Besides, contrary, the evidence on record convincingly shows that her relation with said deceased was that of a
inasmuch as the bishop did not testify, the same is hearsay.
common-law wife.
An agreement with Tee Hoon was shown and signed by Tan Put that she received P40,000 for her
subsistence when they terminated their relationship of common-law marriage and promised not to Moreover, the Supreme Court said that the lower courts committed an error by awarding 1/3 of the
interfere with each other’s affairs since they are incompatible and not in the position to keep living partnership properties to Tan because there has been no liquidation proceedings yet. And if there has
together permanently. Hence, this document not only proves that her relation was that of a common- not yet been any liquidation of the partnership, the only right plaintiff could have would be to what
law wife but had also settled property interests in the payment of P40,000. might result after much liquidation to belong to the deceased partner (her alleged husband) and before
IN VIEW OF ALL THE FOREGOING, the petition is granted. All proceedings held in respondent court in
its Civil Case No. 12328 subsequent to the order of dismissal of October 21, 1974 are hereby annulled
this is finished, it is impossible to determine, what rights or interest, if any the deceased had.
and set aside, particularly the ex-parte proceedings against petitioners and the decision on December In other words, no specific amounts or properties may be adjudicated to the heir or legal representative
20, 1974. Respondent court is hereby ordered to enter an order extending the effects of its order of of the deceased partner without the liquidation being first terminated.
dismissal of the action dated October 21, 1974 to herein petitioners Antonio Lim Tanhu, Dy Ochay,
Alfonso Leonardo Ng Sua and Co Oyo. And respondent court is hereby permanently enjoined from
taking any further action in said civil case gave and except as herein indicated. Costs against private
respondent.
 LIM TANHU v. HON. JOSE R. RAMOLETE

Lim Tanhu v. Ramolete

G.R. No. L-40098; August 29, 1975

G.R. No. L-40098, 29 August 1975 Ponente: J. Barredo

FACTS:

Private respondent Tan Put alleged that she is the widow of Tee Hoon Lim Po Chuan, who was a partner in the commercial
partnership, glory commercial company with Antonio Lim Tanhu and Alfonso Ng Sua’’. Defendants Antonio Lim Tan Hu, Alfonso
Leonardo Ng Sua, Lim Teck Chuan, and Eng Chong Leonardo, through fraud and conspiracy, took actual and active
management of the partnership and although tee Hoon Lim Po Chuan was the manager of glory commercial company, FACTS:
defendants managed to use the funds of the partnership to purchase lands and building in the cities of Cebu, Lapu-Lapu,
Mandaue, and the municipalities of Talisay and Minglanilla.
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 Antonio Lim Tanhu and Alfonso Ng Sua".
She alleged in her complaint that at the time of death of Tee Hoon Lim Po Chuan, the defendants, without liquidation, continued
the business of glory commercial company, by purportedly organizing a corporation known as the glory commercial company,
incorporated and sometime in the month of November, 1967, defendants, particularly Antonio Lim Tan Hu, by means of fraud Defendant Antonio Lim Tanhu, Alfonso Leonardo Ng Sua, Lim Teck Chuan, and Eng Chong Leonardo, through fraud and
deceit, and misrepresentations did then and there , induce and convince her to execute a quitclaim of all her rights and interests, machination, took actual and active management of the partnership and although Tee Hoon Lim Po Chuan was the manager of
in the assets of the partnership of glory commercial company. Glory Commercial Company, defendants managed to use the funds of the partnership to purchase lands and buildings in the
cities of Cebu, Lapulapu, Mandaue, and the municipalities of Talisay and Minglanilla.

Thereafter, in the year 1968-69, the defendants who had earlier promised to liquidate the aforesaid properties and assets in
favor, among others of plaintiff and until the middle of the year 1970 when the plaintiff formally demanded from the defendants
the accounting of real and personal properties of glory commercial company, defendants refused and stated that they would not
give the share of the plaintiff.
ISSUE:
She alleged in her complaint that after the death of Tee Hoon Lim Po Chuan, the defendants, without liquidation, continued the
business of Glory Commercial Company, by purportedly organizing a corporation known as the Glory Commercial Company,
Incorporated and sometime in the month of November, 1967, defendants, particularly Antonio Lim Tanhu, by means of fraud
deceit, and misrepresentations did then and there, induce and convince her to execute a quitclaim of all her rights and interests,
in the assets of the partnership of Glory Commercial Company.

Thereafter, in the year 1968-69, the defendants who had earlier promised to liquidate the aforesaid properties and assets in
Whether Tan Put has right over the liquidated properties of the partnership. favor, among others of plaintiff and until the middle of the year 1970 when the plaintiff formally demanded from the defendants
the accounting of real and personal properties of the Glory Commercial Company, defendants refused and stated that they
would not give the share of the plaintiff.
RULING:

ISSUE:
Tan has a right over the liquidated properties of partnership. The supreme court hold that there is no alternative but to hold that
plaintiff Tan Put’s allegation that she is the widow of Tee Hoon Lim Po Chuan has not been satisfactorily established and that, on
the contrary, the evidence on record convincingly shows that her relation with said deceased was that of common-law wife. Whether Tan has a right over the liquidated properties of the partnership
Moreover, the Supreme Court said that the lower courts committed an error by awarding 1/3 of the partnership properties to Tan
because there has been no liquidation proceedings yet. And if there has not been any liquidation of the partnership, the only
rights plaintiff could have would be to what might result after much liquidation to belong to the deceased partner (her alleged HELD:
husband) and before this is finished, it is impossible to determine, what rights or interest, if any the deceased had. In other words
no specific amounts or properties may be adjudicated to the heir or legal representative of the deceased partner without the
liquidation being first terminated. No, Tan has no right over the liquidated properties of the partnership

Under Article 55 of the Civil Code, the declaration of the contracting parties that they take each other as husband and wife “shall
be set forth in an instrument” signed by the parties as well as by their witnesses and the person solemnizing the marriage.
Accordingly, the primary evidence of a marriage must be an authentic copy of the marriage contract. While a marriage may also
be proved by other competent evidence, the absence of the contract must first be satisfactory explained. Surely, the certification The Supreme Court held that there is no alternative but to hold that plaintiff Tan Put's allegation that she is the widow of Tee
of the person who allegedly solemnized a marriage is not admissible evidence of such marriage unless proof of loss of the Hoon Lim Po Chuan has not been satisfactorily established and that, on the contrary, the evidence on record convincingly shows
contract or of any other satisfactory reason for its non-production is first presented to the court. that her relation with said deceased was that of a common-law wife.

In the case at bar, the purported certification issued by a Mons. Jose M. Recoleto, Philippine Independent Church, Cebu City, is Moreover, the Supreme Court said that the lower courts committed an error by awarding 1/3 of the partnership properties to Tan
not, therefore, competent evidence, there being absolutely no showing as to unavailability of the marriage contract and, indeed, because there has been no liquidation proceedings yet. And if there has not yet been any liquidation of the partnership, the only
as to the authenticity of the signature of said certifies, the jurat allegedly signed by a second assistant provincial fiscal not being right plaintiff could have would be to what might result after much liquidation to belong to the deceased partner (her alleged
authorized by law, since it is not part of the functions of his office. Besides, inasmuch as the bishop did not testify, the same is husband) and before this is finished, it is impossible to determine, what rights or interest, if any the deceased had.
hearsay. As regards the testimony of the plaintiff herself on the same point and that of her witness Antonio Nuñez, there can be
no question that they are both self-serving and of very little evidently value, it having been disclosed at the trial that plaintiff has
already assigned all her rights in this case to said Nuñez, thereby making him the real party in interest here and, therefore,
naturally as biased as herself. Besides, in the portion of the testimony of Nuñez copied in Annex C of petitioner’s memorandum, In other words, no specific amounts or properties may be adjudicated to the heir or legal representative of the deceased partner
it appears admitted that he was born only on March 25, 1942, which means that he was less than eight years old at the without the liquidation being first terminated.
supposed time of the alleged marriage. If for this reason alone, it is extremely doubtful if he could have sufficiently aware of such
event as to be competent to testify about it.
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. G.R. No. L-40098 August 29, 1975
TOPIC: A DISMISSAL OF THE COMPLAINT AS AGAINST ONE OF THE INDISPENSABLE PARTIES, WILL RESULT TO
DISMISSAL AS TO THE OTHERS
NATURE OF THE CASE: The case was elevated to the SC by way of petition for certiorari to annul and set aside certain actuations
of the CFI; specifically, its granting of the motion to drop the two non-defaulted defendants and proceeding to hear to hear the rest
of Tan Put’s (plaintiff’s) evidence ex-parte, and subsequently rendering judgment by default against the defaulted defendants.
FACTS:
Tee Hoon Lim Po Chuan, Alfonso Ng Sua and Antonio Lim Tanhu were partners in the commercial partnership of Glory
Commercial Company with Tee Hoon as the manager. When Tee Hoon died, Tan Put, claiming to be the widow, filed a complaint
against spouses Antonio Lim Tanhu and Dy Ochay. Later, the complaint included Lim Tanhu’s son Lim Teck Chuan, as well as
the spouses Alfonso Ng Sua and Co Oyo, and their son Eng Chong Leonardo. Tan Put claims in her complaint that after Tee Hoon
died, there was no liquidation of the company assets made and that she owns one third of the company shares. However, Lim
Tanhu, Ng Sua, Lim Teck Chuan, and Eng Chong Leonardo continued to manage the company and used the company funds to
acquire lands and buildings in several areas. Allegedly, the defendants also used the company assets to organize another
corporation known as Glory Commercial, Inc.
Subsequently, Tan Put amended her complaint and added other averments. According to Tan Put, she had asked the
defendants to liquidate the business of the defunct partnership including real estate investments in Hong Kong. The defendants
did not make good in their promise to liquidate the said properties, and instead, induced her to execute a quitclaim of all her rights
and interests in the same. After the quitclaim was executed, Lim Tanhu allegedly offered to pay her P65,000 and issued a receipt
to her bearing the said amount. She signed the receipt but was not given a copy of it and had not received the said money. When
she eventually made a formal demand for the accounting and liquidation of the partnership company’s assets, the defendants
refused and stated that they will not give her share.
Lim Tanhu, et. al.: The amended complaint (2nd paragraph) should not be admitted as there were material modifications of the
causes of action previously alleged.
CFI: The judge allowed the amendment and said that the present action is for accounting of real and personal properties as well
as for the recovery of the same with damages. The amended complaint only alleged facts that merely amplified the material
averments constituting the cause of action in the original complaint. It likewise include necessary and indispensable defendants
without whom no final determination can be had in the action and in order that complete relief is to be accorded as between those
already parties. Thus, the amendments were allowed because they did not change the main causes of action in the original
complaint.
---Trial continued
The defendants filed a single answer with counterclaim. They assert that Tan Put was not Tee Hoon’s legitimate wife as
the real Mrs. Tee Hoon, Ang Siok Tin, is in Hong Kong. They also denied the allegations of fraud and claimed that proper liquidation
had been regularly made of the business of the partnership and Tee Hoon regularly received his share until his death. After which,
the partnership was dissolved and his supposed share were all given to Ang Siok and their children.
Lim Tanhu, et.al.: (By way of COUNTERCLAIM) The case should be dismissed since Tan Put is not the legitimate wife, and thus,
lacks the legal capacity to sue them. Further, even before the death of Tee Hoon, Tan Put was no longer the decedent’s common
law wife and the ‘quitclaim’ was only offered to her by Lim Tanhu out of the latter’s kindness and generosity. Thus, in the event
that Tan Put is filing the case under Art. 144 of the Civil Code (this part was already removed in the present Civil Code and was
replaced by the Family Code), then, her acceptance of the ‘quitclaim’ constitutes a waiver for her claims.
The newly acquired properties of the defendants were bought out of their own personal funds and not from the funds
belonging to the partnership. Further, since Tee Hoon and Tan Put did not have a child together, there was no one who is lawfully
entitled to succeed to the properties left by Tee Hoon together with the widow and the legitimate children.
Tan Put: The said counterclaim should be dismissed as it is merely permissive and the corresponding filing fee was not paid.
CFI: (Ruling on the motion of Tan Put to dismiss the counterclaim of the defendants) Overruled. The counterclaim was accepted
by the court and declared to be a compulsory counterclaim.
Tan Put: Denied all the allegations in the defendants counterclaim.
--- However, on the date set for the pre-trial, the spouses Lim Tanhus and Ng Suas did not appear, it being their belief that they
were all compulsory parties and that the defense of one is the defense of all of them. Thus, they were all “declared in DEFAULT”.
The said spouses tried to lift the order thru a motion for reconsideration, but the court denied such. During the trial, whil e her
allegedly adopted son Antonio Nuñez was testifying and was up for re-cross-examination, Tan Put suddenly filed a motion to drop
Lim Teck Chuan and Eng Chong Leonardo as defendants to the case without justifications, which was granted by the court.
CFI: With the granting of the motion to drop Lim Teck Chuan and Eng Chong Leonardo as defendants, the case against the two
was dismissed upon order. However, since the spouses Lim Tanhus and Ng Suas were declared to be in default for their non-
appearance in the pretrial, they remain to be defendants in the complaint. Aside from giving the said order, the court proceeded to
hear ex-parte the rest of Tan Put’s evidence.
--- The dropped defendants separately filed a motion for reconsideration over the said orders of the RTC, but were all denied.
However, the denial of their motions was received after the RTC’s judgment was promulgated.
Thus, all the defendants filed a motion to quash the order dropping the 2 defendants, but was later declared to be
abandoned by the defendants. Hence this present petition for certiorari to annul the decision and actuations of the CFI.
Lim Tanhu, et.al. : There was a compulsory counterclaim in the common answer of the defendants and it is the nature of such
that it cannot be decided in an independent action. Under Sec.4 Rule 18, the CFI has no authority to divide the case before it by
dismissing the case against the non-defaulted defendants, and thereafter proceeded to hear the case ex-parte and subsequently
rendering judgment against the defaulted defendants. Further, under the said rule, when a common cause of action is alleged
against several defendants, the default of any of them is a mere formality by which those defaulted are not allowed to take part in
the proceedings. But otherwise, all the defendants, defaulted and not defaulted, are supposed to have but a common fate, win or
lose. Thus, there shall only be one common judgment for or against all the defendants, whether defaulted or non-defaulted.
Following such argument, either the CFI dismiss the case against all the defendants or resume the proceedings and allow the non-
defendants to defend the case for all the defendants.
Tan Put: The spouses Lim Tanhu and the spouses Ng Suas were properly declared in default. Thus, they have no personality or
interest to question the dismissal of the case as against their non-defaulted co-defendants and should suffer the consequences of
their own default.
ISSUE: Whether or not, by virtue of the nature of the counterclaim of the defendants, either the dismissal of the complaint be
applied to all the defendants or the proceedings be resumed and the non-defaulted defendants be allowed to present defense on
behalf of all of them.
HELD: Yes. The defendants’ counterclaim is a compulsory one because the same evidence to sustain it will also refute the cause
or causes of action alleged in plaintiff's complaint. Moreover, it is compulsory because it is obvious that the same cannot "remain
pending for independent adjudication by the court."
Further, under the rules, "(i)f a counterclaim has been pleaded by a defendant prior to the service upon him of the
plaintiff's motion to dismiss, the action shall not be dismissed against the defendant's objection unless the counterclaim can remain
pending for independent adjudication by the court." In the instant case, it was evident that the judgment against the defaulted
defendants was rendered before the non-defaulted defendants’ motion for reconsideration of the order dropping them as
defendants in the case was received by them.
It should be noted that when Tan Put earlier questioned the defendants’ counterclaim, the CFI ruled that the same
was permissive, and yet, contrary to the nature of compulsory counterclaim, it granted the dropping of the non-defaulted defendants
and proceeded in hearing Tan Put’s evidence ex-parte.
Moreover, it is clear that all the defendants are indispensable parties and under the rules of court and according to
jurisprudence, “when an indispensable party is not before the court (that) the action should be dismissed."
Additionally, the order dropping the non-defaulted defendants “was not predicated on Section 2 of Rule 17 but more
on Section 11 of Rule 3. But the truth is that nothing can be more incorrect.” To start with, the latter rule does not comprehend
whimsical and irrational dropping or adding of parties in a complaint. What it really contemplates is erroneous or mistaken non-
joinder and misjoinder of parties. No one is free to join anybody in a complaint in court only to drop him unceremoni ously later at
the pleasure of the plaintiff. The rule presupposes that the original inclusion had been made in the honest conviction that i t was
proper and the subsequent dropping is requested because it has turned out that such inclusion was a mistake. And this is the
reason why the rule ordains that the dropping be "on such terms as are just" — just to all the other parties.
In the case at bar, there is nothing in the record to legally justify the dropping of the non-defaulted defendants, Lim
and Leonardo. Even Tan Put’s motion dropping them as defendants did not provide any justification. From all appearances, Tan
Put just decided to ask for it, without any relevant explanation at all. Usually, the court in granting such a motion inquires for the
reasons and in the appropriate instances directs the granting of some form of compensation for the trouble undergone by the
defendant in answering the complaint, preparing for or proceeding partially to trial, hiring counsel and making corresponding
expenses in the premises. Nothing of these, appears in the order in question. Most importantly, the judge ought to have considered
that the outright dropping of the non-defaulted defendants Lim and Leonardo, over their objection at that, would certainly be unjust
not only to the petitioners, their own parents, who would in consequence be entirely defenseless, but also to Lim and Leonardo
themselves who would naturally correspondingly suffer from the eventual judgment against their parents. Respondent court paid
no heed at all to the mandate that such dropping must be on such terms as are just" — meaning to all concerned with its legal and
factual effects.
Thus, it is quite plain that respondent court erred in issuing its order of dismissal of the order dropping the non-
defaulted defendants in the complaint as well as its order denying reconsideration of such dismissal. Though Lim and Leonardo
are not parties to the herein petition, such consideration is inconsequential. The fate of the case of petitioners is inseparably tied
up with said order of dismissal, if only because the order of ex-parte hearing of the case which directly affects and prejudices said
petitioners is predicated thereon.
Hence, PETITION GRANTED. All proceedings held by the respondent CFI particularly the ex-parte proceedings
against the defendants are annulled and set aside. Further, “[r]espodent court is hereby ordered to enter an order extending the
effects of its order of dismissal of the action dated October 21, 1974 to herein petitioners Antonio Lim Tanhu, Dy Ochay, Alfonso
Leonardo Ng Sua and Co Oyo. And respondent court is hereby permanently enjoined from taking any further action in said civil
case gave and except as herein indicated.”