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! Corporations; liability of corporate officers. As a general rule, the officer cannot be held personally liable with the
corporation, whether civilly or otherwise, for the consequences his acts, if acted for and in behalf of the corporation,
within the scope of his authority and in good faith. Rodolfo Laborte, et al. v. Pagsanjan Tourism Consumers
Cooperative, et al., G.R. No. 183860, January 15, 2014.

! Banks; degree of diligence. Being a banking institution, DBP owed it to Guaria Corporation to exercise the highest
degree of diligence, as well as to observe the high standards of integrity and performance in all its transactions
because its business was imbued with public interest. The high standards were also necessary to ensure public
confidence in the banking system. Development Bank of the Philippines (DBP) v. Guaria Agricultural and Realty
Development Corporation, G.R. No. 160758. January 15, 2014.
civil-january 6/4/14 2:33 PM
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January 2014 Philippine Supreme Court Decisions on Civil Law

Bad faith cannot be presumed; it is a question of fact that must be proven by clear and convincing evidence. It is worth
stressing at this point that bad faith cannot be presumed. It is a question of fact that must be proven by clear and
convincing evidence. [T]he burden of proving bad faith rests on the one alleging it. Sadly, spouses Vilbar failed to adduce
the necessary evidence. Thus, this Court finds no error on the part of the CA when it did not find bad faith on the part of
Gorospe, Sr. Sps. Bernadette and Rodulfo Vilbar v. Angelito L. Opinion, G.R. No. 176043. January 15, 2014.

Banks; exercise the highest degree of diligence, as well as to observe the high standards of integrity and performance in all
its transactions because its business was imbued with public interest. Being a banking institution, DBP owed it to Guaria
Corporation to exercise the highest degree of diligence, as well as to observe the high standards of integrity and
performance in all its transactions because its business was imbued with public interest. The high standards were also
necessary to ensure public confidence in the banking system, for, according to Philippine National Bank v. Pike: The
stability of banks largely depends on the confidence of the people in the honesty and efficiency of banks. Development
Bank of the Philippines (DBP) v. Guaria Agricultural and Realty Development Corporation, G.R. No. 160758. January 15,
2014

Common carrier; cargoes while being unloaded generally remain under the custody of the carrier. It is settled in maritime law
jurisprudence that cargoes while being unloaded generally remain under the custody of the carrier. As hereinbefore found by
the RTC and affirmed by the CA based on the evidence presented, the goods were damaged even before they were turned
over to ATI. Such damage was even compounded by the negligent acts of petitioner and ATI which both mishandled the
goods during the discharging operations. Eastern Shipping Lines, Inc. v. BPI/MS Insurance Corp., and Mitsui Sumitomo
Insurance Co., Ltd.,G.R. No. 193986, January 15, 2014.

Common carrier; extraordinary diligence.Common carriers, from the nature of their business and for reasons of public
policy, are bound to observe extraordinary diligence in the vigilance over the goods transported by them. Subject to certain
exceptions enumerated under Article 1734 of the Civil Code, common carriers are responsible for the loss, destruction, or
deterioration of the goods. The extraordinary responsibility of the common carrier lasts from the time the goods are
unconditionally placed in the possession of, and received by the carrier for transportation until the same are delivered,
actually or constructively, by the carrier to the consignee, or to the person who has a right to receive them. Owing to this
high degree of diligence required of them, common carriers, as a general rule, are presumed to have been at fault or
negligent if the goods they transported deteriorated or got lost or destroyed. That is, unless they prove that they
exercised extraordinary diligence in transporting the goods. In order to avoid responsibility for any loss or damage,
therefore, they have the burden of proving that they observed such high level of diligence. Eastern Shipping Lines, Inc. v.
BPI/MS Insurance Corp., and Mitsui Sumitomo Insurance Co., Ltd.,G.R. No. 193986, January 15, 2014.

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Contracts; breach of contract; petitioner is guilty of breach of contract when it unjustifiably refused to release
respondents deposit despite demand; liable for damages. In cases of breach of contract, moral damages may be recovered
only if the defendant acted fraudulently or in bad faith, or is guilty of gross negligence amounting to bad faith, or in
wanton disregard of his contractual obligations.
In this case, a review of the circumstances surrounding the issuance of the Hold Out order reveals that petitioner issued
the Hold Out order in bad faith. First of all, the order was issued without any legal basis. Second, petitioner did not
inform respondents of the reason for the Hold Out. Third, the order was issued prior to the filing of the criminal
complaint. Records show that the Hold Out order was issued on July 31, 2003, while the criminal complaint was filed
only on September 3, 2003. All these taken together lead us to conclude that petitioner acted in bad faith when it
breached its contract with respondents. As we see it then, respondents are entitled to moral damages. Metropolitan Bank
& Trust Company v. Ana Grace Rosales and Yo Yuk To, G.R. No. 183204, January 13, 2014.

Contracts; buyer in good faith. It is settled that a party dealing with a registered land does not have to inquire beyond the
Certificate of Title in determining the true owner thereof, and in guarding or protecting his interest, for all that he has to
look into and rely on are the entries in the Certificate of Title.
Inarguably, Opinion acted in good faith in dealing with the registered owners of the properties. He relied on the titles
presented to him, which were confirmed by the Registry of Deeds to be authentic, issued in accordance with the law, and
without any liens or encumbrances. Sps. Bernadette and Rodulfo Vilbar v. Angelito L. Opinion, G.R. No. 176043. January
15, 2014.

Contracts; Doctrine of in pari delicto; exception. According to Article 1412 (1) of the Civil Code, the guilty parties to an
illegal contract cannot recover from one another and are not entitled to an affirmative relief because they are in pari
delicto or in equal fault. The doctrine of in pari delicto is a universal doctrine that holds that no action arises, in equity or at
law, from an illegal contract; no suit can be maintained for its specific performance, or to recover the property agreed to
be sold or delivered, or the money agreed to be paid, or damages for its violation; and where the parties are in pari delicto,
no affirmative relief of any kind will be given to one against the other.
Nonetheless, the application of the doctrine of in pari delicto is not always rigid. An accepted exception arises when its
application contravenes well-established public policy. In this jurisdiction, public policy has been defined as that principle of
the law which holds that no subject or citizen can lawfully do that which has a tendency to be injurious to the public or
against the public good. Domingo Gonzalo v. John Tarnate, Jr., G.R. No. 160600, January 15, 2014.

Contracts; Hold-out clause; applies only if there is a valid and existing obligation arising from any of the sources of
obligation enumerated in Article 1157. Considering that respondent Rosales is not liable under any of the five sources of
obligation, there was no legal basis for petitioner to issue the Hold Out order.
The Hold Out clause applies only if there is a valid and existing obligation arising from any of the sources of obligation
enumerated in Article 1157 of the Civil Code, to wit: law, contracts, quasi-contracts, delict, and quasi-delict. In this case,
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petitioner failed to show that respondents have an obligation to it under any law, contract, quasi-contract, delict, or quasi-
delict. And although a criminal case was filed by petitioner against respondent Rosales, this is not enough reason for
petitioner to issue a Hold Out order as the case is still pending and no final judgment of conviction has been rendered
against respondent Rosales. In fact, it is significant to note that at the time petitioner issued the Hold Out order, the
criminal complaint had not yet been filed. Thus, considering that respondent Rosales is not liable under any of the five
sources of obligation, there was no legal basis for petitioner to issue the Hold Out order. Metropolitan Bank & Trust
Company v. Ana Grace Rosales and Yo Yuk To, G.R. No. 183204, January 13, 2014.

Contracts; Mortgage; nature of mortgage. It is true that loans are often secured by a mortgage constituted on real or
personal property to protect the creditors interest in case of the default of the debtor. By its nature, however, a mortgage
remains an accessory contract dependent on the principal obligation, such that enforcement of the mortgage contract will
depend on whether or not there has been a violation of the principal obligation. While a creditor and a debtor could regulate
the order in which they should comply with their reciprocal obligations, it is presupposed that in a loan the lender should
perform its obligation the release of the full loan amount before it could demand that the borrower repay the loaned
amount. Development Bank of the Philippines (DBP) v. Guaria Agricultural and Realty Development Corporation, G.R. No.
160758. January 15, 2014.

Contracts; mortgagee in good faith. Assuming arguendo that the Gorospes titles to the subject properties happened to be
fraudulent, public policy considers Opinion to still have acquired legal title as a mortgagee in good faith. As held in Cavite
Development Bank v. Spouses Lim:
There is, however, a situation where, despite the fact that the mortgagor is not the owner of the mortgaged property, his
title being fraudulent, the mortgage contract and any foreclosure sale arising therefrom are given effect by reason of public
policy. This is the doctrine of the mortgagee in good faith based on the rule that all persons dealing with property covered
by a Torrens Certificate of Title, as buyers or mortgagees, are not required to go beyond what appears on the face of the
title. The public interest in upholding the indefeasibility of a certificate of title, as evidence of the lawful ownership of the
land or of any encumbrance thereon, protects a buyer or mortgagee who, in good faith, relied upon what appears on the
face of the certificate of title.
Sps. Bernadette and Rodulfo Vilbar v. Angelito L. Opinion, G.R. No. 176043. January 15, 2014.

Sales; proof capacity of seller; difference when there is a special power of attorney and when there is none.The strength
of the buyers inquiry on the sellers capacity or legal authority to sell depends on the proof of capacity of the seller. If the
proof of capacity consists of a special power of attorney duly notarized, mere inspection of the face of such public
document already constitutes sufficient inquiry. If no such special power of attorney is provided or there is one but there
appears to be flaws in its notarial acknowledgment, mere inspection of the document will not do; the buyer must show that
his investigation went beyond the document and into the circumstances of its execution. The Heirs of Victorino Sarili,
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namely, Isabel A. Sarili, et al. v. Pedro F. Lagrosa, represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica,
G.R. No. 193517, January 15, 2014.

Contracts; Principle of quantum merit; when allowed. Case law instructs that under this principle (quantum meruit), a
contractor is allowed to recover the reasonable value of the thing or services rendered despite the lack of a written
contract, in order to avoid unjust enrichment. Quantum meruit means that, in an action for work and labor, payment shall be
made in such amount as the plaintiff reasonably deserves. The measure of recovery should relate to the reasonable value of
the services performed because the principle aims to prevent undue enrichment based on the equitable postulate that it is
unjust for a person to retain any benefit without paying for it. Rivelisa Realty, Inc., represented by Ricardo P. Venturina v.
First Sta. Clara Builders Corporation, represented by Ramon A. Pangilinan, as President, G.R. No. 189618. January 15,
2014.

Contracts; rescission; proper when there is non-performance of obligation. Article 1191. The power to rescind obligations is
implied in reciprocal ones, in case one of the obligors should not comply with what is incumbent upon him. The injured party
may choose between the fulfillment and the rescission of the obligation, with payment of damages in either case. He may
also seek rescission, even after he has chosen fulfillment, if the latter should become impossible. Fil-Estate Properties, Inc.
and Fil-Estate Network, Inc. v. Spouses Conrado and Maria Victoria Ronquillo, G.R. No. 185798, January 13, 2014.

Contracts; void contract; effects. Under Article 1409 (1) of the Civil Code, a contract whose cause, object or purpose is
contrary to law is a void or inexistent contract. As such, a void contract cannot produce a valid one. To the same effect is
Article 1422 of the Civil Code, which declares that a contract, which is the direct result of a previous illegal contract, is
also void and inexistent. Domingo Gonzalo v. John Tarnate, Jr., G.R. No. 160600, January 15, 2014.

Damages; moral damages; when awarded.[S]uffice it to say that the dispute over the subject property had caused
respondent serious anxiety, mental anguish and sleepless nights, thereby justifying the aforesaid award. Likewise, since
respondent was constrained to engage the services of counsel to file this suit and defend his interests, the awards of
attorneys fees and litigation expenses are also sustained. The Heirs of Victorino Sarili, namely, Isabel A. Sarili, et al. v.
Pedro F. Lagrosa, represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica, G.R. No. 193517, January 15,
2014.

Damages; moral damages; when awarded. Every person is entitled to the physical integrity of his body. Although we have
long advocated the view that any physical injury, like the loss or diminution of the use of any part of ones body, is not
equatable to a pecuniary loss, and is not susceptible of exact monetary estimation, civil damages should be assessed once
that integrity has been violated. The assessment is but an imperfect estimation of the true value of ones body. The usual
practice is to award moral damages for the physical injuries sustained. Dr. Encarnacion C. Lumantas v. Hanz Calapiz,
represented by his parents, Hilario Calapiz, Jr. and Helita Calapiz, G.R. No. 163753. January 15, 2014.
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Foreclosure; premature foreclosure; order of restoration of possession and payment of reasonable rentals. Having found
and pronounced that the extrajudicial foreclosure by DBP was premature, and that the ensuing foreclosure sale was void
and ineffectual, the Court affirms the order for the restoration of possession to Guarifia Corporation and the payment of
reasonable rentals for the use of the resort. The CA properly held that the premature and invalid foreclosure had unjustly
dispossessed Guarifia Corporation of its properties. Consequently, the restoration of possession and the payment of
reasonable rentals were in accordance with Article 561 of the Civil Code, which expressly states that one who recovers,
according to law, possession unjustly lost shall be deemed for all purposes which may redound to his benefit to have
enjoyed it without interruption. Development Bank of the Philippines (DBP) v. Guaria Agricultural and Realty Development
Corporation, G.R. No. 160758. January 15, 2014.

Foreclosure; purchaser in foreclosure sale may take possession of the property even before the expiration of the
redemption period. A writ of possession is a writ of execution employed to enforce a judgment to recover the possession
of land. It commands the sheriff to enter the land and give possession of it to the person entitled under the judgment. It
may be issued in case of an extrajudicial foreclosure of a real estate mortgage under Section 7 of Act No. 3135, as
amended by Act No. 4118.
Under said provision, the writ of possession may be issued to the purchaser in a foreclosure sale either within the one-year
redemption period upon the filing of a bond, or after the lapse of the redemption period, without need of a bond.
We have consistently held that the duty of the trial court to grant a writ of possession is ministerial. Such writ issues as a
matter of course upon the filing of the proper motion and the approval of the corresponding bond. No discretion is left to
the trial court. Any question regarding the regularity and validity of the sale, as well as the consequent cancellation of the
writ, is to be determined in a subsequent proceeding as outlined in Section 8 of Act No. 3135. Such question cannot be
raised to oppose the issuance of the writ, since the proceeding is ex parte. The recourse is available even before the
expiration of the redemption period provided by law and the Rules of Court. LZK Holdings and Development Corporation v.
Planters Development Bank, G.R. No. 187973, January 20, 2014.

Interest; legal interest; interest rate pegged at 6% regardless of the source of obligation. The resulting modification of the
award of legal interest is, also, in line with our recent ruling in Nacar v. Gallery Frames, embodying the amendment
introduced by the Bangko Sentral ng Pilipinas Monetary Board in BSP-MB Circular No. 799 which pegged the interest
rate at 6% regardless of the source of obligation. Fil-Estate Properties, Inc. and Fil-Estate Network, Inc. v. Spouses
Conrado and Maria Victoria Ronquillo, G.R. No. 185798, January 13, 2014.

Interest; legal interest; proper rate. In Eastern Shipping, it was observed that the commencement of when the legal interest
should start to run varies depending on the factual circumstances obtaining in each case. As a rule of thumb, it was
suggested that where the demand is established with reasonable certainty, the interest shall begin to run from the time the
claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established
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at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at
which time the quantification of damages may be deemed to have been reasonably ascertained).
During the pendency of this case, however, the Monetary Board issued Resolution No. 796 dated May 16, 2013, stating
that in the absence of express stipulation between the parties, the rate of interest in loan or forbearance of any money,
goods or credits and the rate allowed in judgments shall be 6% per annum. Said Resolution is embodied in Bangko Sentral
ng Pilipinas Circular No. 799, Series of2013, which took effect on July 1, 2013. Hence, the 12% annual interest
mentioned above shall apply only up to June 30, 2013. Thereafter, or starting July 1, 2013, the applicable rate of interest
for both the debited amount and undocumented withdrawals shall be 6% per annum compounded annually, until fully paid.
Land Bank of the Philippines v. Emmanuel C. Oate, G.R. No. 192371, January 15, 2014.

Interest; legal interest; rate. The legal interest rate to be imposed from February 11, 1993, the time of the extrajudicial
demand by respondent, should be 6% per annum in the absence of any stipulation in writing in accordance with Article
2209 of the Civil Code, which provides:
Article 2209. If the obligation consists in the payment of a sum of money, and the debtor incurs in delay, the indemnity
for damages, there being no stipulation to the contrary, shall be the payment of the interest agreed upon, and in the
absence of stipulation, the legal interest, which is six per cent per annum. First United Constructors Corporation, et al. v.
Bayanihan Automotive Corporation, G.R. No. 164985, January 15, 2014.

Interest; legal interest; when awarded. Many years have gone by since Hanz suffered the injury. Interest of 6% per annum
should then be imposed on the award as a sincere means of adjusting the value of the award to a level that is not only
reasonable but just and commensurate. Unless we make the adjustment in the permissible manner by prescribing legal
interest on the award, his sufferings would be unduly compounded. For that purpose, the reckoning of interest should be
from the filing of the criminal information on April 1 7, 1997, the making of the judicial demand for the liability of the
petitioner. Dr. Encarnacion C. Lumantas v. Hanz Calapiz, represented by his parents, Hilario Calapiz, Jr. and Helita Calapiz,
G.R. No. 163753. January 15, 2014.

Obligations; default; borrower would not be in default without demand to pay. Considering that it had yet to release the
entire proceeds of the loan, DBP could not yet make an effective demand for payment upon Guaria Corporation to
perform its obligation under the loan. According to Development Bank of the Philippines v. Licuanan, it would only be when a
demand to pay had been made and was subsequently refused that a borrower could be considered in default, and the lender
could obtain the right to collect the debt or to foreclose the mortgage. Development Bank of the Philippines (DBP) v.
Guaria Agricultural and Realty Development Corporation, G.R. No. 160758. January 15, 2014.

Obligations; extinguishment of obligations; compensation; requisites. Compensation is defined as a mode of extinguishing
obligations whereby two persons in their capacity as principals are mutual debtors and creditors of each other with respect
to equally liquidated and demandable obligations to which no retention or controversy has been timely commenced and
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communicated by third parties. The requisites therefor are provided under Article 1279 of the Civil Code which reads as
follows:
Art. 1279. In order that compensation may be proper, it is necessary:
(1) That each one of the obligors be bound principally, and that he be at the same time a principal creditor of the other;
(2) That both debts consist in a sum of money, or if the things due are consumable, they be of the same kind, and also of
the same quality if the latter has been stated;
(3) That the two debts be due;
(4) That they be liquidated and demandable;
(5) That over neither of them there be any retention or controversy, commenced by third persons and communicated in due
time to the debtor.
The rule on legal compensation is stated in Article 1290 of the Civil Code which provides that [w]hen all the requisites
mentioned in Article 1279 are present, compensation takes effect by operation of law, and extinguishes both debts to the
concurrent amount, even though the creditors and debtors are not aware of the compensation. Union Bank of the
Philippines v. Development Bank of the Philippines, G.R. No. 191555, January 20, 2014.

Obligations; legal compensation; requisites. Legal compensation takes place when the requirements set forth in Article
1278 and Article 1279 of the Civil Code are present, to wit:
Article 1278. Compensation shall take place when two persons, in their own right, are creditors and debtors of each other.
Article 1279. In order that compensation may be proper, it is necessary:
(1) That each of the obligors be bound principally, and that he be at the same time a principal creditor of the other;
(2) That both debts consists in a sum of money, or if the things due are consumable, they be of the same kind, and also of
the same quality if the latter has been stated;
(3) That the two debts be due;
(4) That they be liquidated and demandable;
(5) That over neither of them there be any retention or controversy, commenced by third persons and communicated in due
time to the debtor.
First United Constructors Corporation, et al. v. Bayanihan Automotive Corporation, G.R. No. 164985, January 15, 2014.

Property; builder in good faith; concept of. To be deemed a builder in good faith, it is essential that a person asserts title to
the land on which he builds, i.e. , that he be a possessor in concept of owner, and that he be unaware that there exists in his
title or mode of acquisition any flaw which invalidates it. Good faith is an intangible and abstract quality with no technical
meaning or statutory definition, and it encompasses, among other things, an honest belief, the absence of malice and the
absence of design to defraud or to seek an unconscionable advantage. It implies honesty of intention, and freedom from
knowledge of circumstances which ought to put the holder upon inquiry. The Heirs of Victorino Sarili, namely, Isabel A.
Sarili, et al. v. Pedro F. Lagrosa, represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica, G.R. No. 193517,
January 15, 2014.
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Property; ownership; accession; accessory follows the principal; exception. While it is a hornbook doctrine that the
accessory follows the principal, that is, the ownership of the property gives the right by accession to everything which is
produced thereby, or which is incorporated or attached thereto, either naturally or artificially, such rule is not without
exception. In cases where there is a clear and convincing evidence to prove that the principal and the accessory are not
owned by one and the same person or entity, the presumption shall not be applied and the actual ownership shall be upheld.
In a number of cases, we recognized the separate ownership of the land from the building and brushed aside the rule that
accessory follows the principal. Magdalena T. Villasi v. Filomena Garcia, substituted by his heirs, namely, Ermelinda H.
Garcia, et al., G.R. No. 190106, January 15, 2014.

Quasi-contracts; Unjust enrichment. Unjust enrichment exists, according to Hulst v. PR Builders, Inc., when a person
unjustly retains a benefit at the loss of another, or when a person retains money or property of another against the
fundamental principles of justice, equity and good conscience. The prevention of unjust enrichment is a recognized public
policy of the State, for Article 22 of the Civil Code explicitly provides that [e]very person who through an act of
performance by another, or any other means, acquires or comes into possession of something at the expense of the latter
without just or legal ground, shall return the same to him. Domingo Gonzalo v. John Tarnate, Jr., G.R. No. 160600,
January 15, 2014.

Sales; Article 1599 of the Civil Code; recoupment; definition of; when entitled. Recoupment (reconvencion) is the act of
rebating or recouping a part of a claim upon which one is sued by means of a legal or equitable right resulting from a
counterclaim arising out of the same transaction. It is the setting up of a demand arising from the same transaction as the
plaintiffs claim, to abate or reduce that claim.
The legal basis for recoupment by the buyer is the first paragraph of Article 1599 of the Civil Code, viz:
Article 1599. Where there is a breach of warranty by the seller, the buyer may, at his election:
(1) Accept or keep the goods and set up against the seller, the breach of warranty by way of recoupment in diminution or
extinction of the price;
x x x x
First United Constructors Corporation, et al. v. Bayanihan Automotive Corporation, G.R. No. 164985, January 15, 2014.

Sales; sale of a piece of land or any interest therein is through an agent; authority of the agent shall be in writing;
otherwise, the sale shall be void. The due execution and authenticity of the subject SPA are of great significance in
determining the validity of the sale entered into by Victorino and Ramon since the latter only claims to be the agent of the
purported seller (i.e., respondent). Article 1874 of the Civil Code provides that [w]hen a sale of a piece of land or any
interest therein is through an agent, the authority of the latter shall be in writing; otherwise, the sale shall be void. In other
words, if the subject SPA was not proven to be duly executed and authentic, then it cannot be said that the foregoing
requirement had been complied with; hence, the sale would be void. The Heirs of Victorino Sarili, namely, Isabel A. Sarili, et
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al. v. Pedro F. Lagrosa, represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica, G.R. No. 193517, January
15, 2014.

SPECIAL LAWS
Section 23 of Presidential Decree No. 957; non-forfeiture of payments. Section 23 of Presidential Decree No. 957, the
rule governing the sale of condominiums, which provides: No installment payment made by a buyer in a subdivision or
condominium project for the lot or unit he contracted to buy shall be forfeited in favor of the owner or developer when the
buyer, after due notice to the owner or developer, desists from further payment due to the failure of the owner or
developer to develop the subdivision or condominium project according to the approved plans and within the time limit for
complying with the same. Such buyer may, at his option, be reimbursed the total amount paid including amortization interests
but excluding delinquency interests, with interest thereon at the legal rate. Fil-Estate Properties, Inc. and Fil-Estate
Network, Inc. v. Spouses Conrado and Maria Victoria Ronquillo, G.R. No. 185798, January 13, 2014.

Section 6 of Presidential Decree No. 1594; right of assignment and subcontract. There is no question that every
contractor is prohibited from subcontracting with or assigning to another person any contract or project that he has with
the DPWH unless the DPWH Secretary has approved the subcontracting or assignment. This is pursuant to Section 6 of
Presidential Decree No. 1594, which provides that [T]he contractor shall not assign, transfer, pledge, subcontract or
make any other disposition of the contract or any part or interest therein except with the approval of the Minister of
Public Works, Transportation and Communications, the Minister of Public Highways, or the Minister of Energy, as the
case may be. Approval of the subcontract shall not relieve the main contractor from any liability or obligation under his
contract with the Government nor shall it create any contractual relation between the subcontractor and the
Government. Domingo Gonzalo v. John Tarnate, Jr., G.R. No. 160600, January 15, 2014.

Family law; conjugal property; all property of the marriage is presumed to be conjugal, unless it is shown that it is owned
exclusively by the husband or the wife. There is a presumption that all property of the marriage is conjugal, unless it is
shown that it is owned exclusively by the husband or the wife; this presumption is not overcome by the fact that the
property is registered in the name of the husband or the wife alone; and the consent of both spouses is required before a
conjugal property may be mortgaged. However, we find it iniquitous to apply the foregoing presumption especially since the
nature of the mortgaged property was never raised as an issue before the RTC, the CA, and even before this Court. In
fact, petitioner never alleged in his Complaint that the said property was conjugal in nature. Hence, respondent had no
opportunity to rebut the said presumption. Francisco Lim v. Equitable PCI Bank, now known as Banco De Oro Unibank,
Inc., G.R. No. 183918. January 15, 2014.

Family law; exclusive property of spouse; when the property is registered in the name of a spouse only and there is no
showing as to when the property was acquired by said spouse, this is an indication that the property belongs exclusively to
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said spouse. Article 160 of the Civil Code provides as follows: All property of the marriage is presumed to belong to the
conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife.
The presumption applies to property acquired during the lifetime of the husband and wife. In this case, it appears on the
face of the title that the properties were acquired by Donata Montemayor when she was already a widow. When the
property is registered in the name of a spouse only and there is no showing as to when the property was acquired by said
spouse, this is an indication that the property belongs exclusively to said spouse. And this presumption under Article 160
of the Civil Code cannot prevail when the title is in the name of only one spouse and the rights of innocent third parties are
involved. Francisco Lim v. Equitable PCI Bank, now known as Banco De Oro Unibank, Inc., G.R. No. 183918. January 15,
2014.

Torrens system; certificate of title; a certificate of title serves as evidence of an indefeasible and incontrovertible title to
the property in favor of the person whose name appears therein. [A] certificate of title serves as evidence of an
indefeasible and incontrovertible title to the property in favor of the person whose name appears therein. Having no
certificate of title issued in their names, spouses Vilbar have no indefeasible and incontrovertible title over Lot 20 to
support their claim. Further, it is an established rule that registration is the operative act which gives validity to the
transfer or creates a lien upon the land. Any buyer or mortgagee of realty covered by a Torrens certificate of title x x x
is charged with notice only of such burdens and claims as are annotated on the title. Failing to annotate the deed for the
eventual transfer of title over Lot 20 in their names, the spouses Vilbar cannot claim a greater right over Opinion, who
acquired the property with clean title in good faith and registered the same in his name by going through the legally required
procedure. Sps. Bernadette and Rodulfo Vilbar v. Angelito L. Opinion, G.R. No. 176043. January 15, 2014.

Torrens system; Torrens title; a person dealing with a registered land has a right to rely upon the face of the Torrens
certificate of title; exceptions. The well-known rule in this jurisdiction is that a person dealing with a registered land has a
right to rely upon the face of the torrens certificate of title and to dispense with the need of inquiring further, except when
the party concerned has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make
such inquiry.
A torrens title concludes all controversy over ownership of the land covered by a final decree of registration. Once the title
is registered the owner may rest assured without the necessity of stepping into the portals of the court or sitting in the
mirador de su casa to avoid the possibility of losing his land. Francisco Lim v. Equitable PCI Bank, now known as Banco De
Oro Unibank, Inc., G.R. No. 183918. January 15, 2014.

Torrens title; a person dealing with a registered land has a right to rely upon the face of the Torrens certificate of title;
exception in the case of a person who buys from a person who is not the registered owner.The general rule is that every
person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law
will in no way oblige him to go beyond the certificate to determine the condition of the property. Where there is nothing in
the certificate of title to indicate any cloud or vice in the ownership of the property, or any encumbrance thereon, the
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purchaser is not required to explore further than what the Torrens Title upon its face indicates in quest for any hidden
defects or inchoate right that may subsequently defeat his right thereto.
However, a higher degree of prudence is required from one who buys from a person who is not the registered owner,
although the land object of the transaction is registered. In such a case, the buyer is expected to examine not only the
certificate of title but all factual circumstances necessary for him to determine if there are any flaws in the title of the
transferor. The buyer also has the duty to ascertain the identity of the person with whom he is dealing with and the latters
legal authority to convey the property. The Heirs of Victorino Sarili, namely, Isabel A. Sarili, et al. v. Pedro F. Lagrosa,
represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica, G.R. No. 193517, January 15, 2014.

Torrens system;even if the procurement of a certificate of title was tainted with fraud and misrepresentation, such
defective title may be the source of a completely legal and valid title in the hands of an innocent purchaser for value. It is
well-settled that even if the procurement of a certificate of title was tainted with fraud and misrepresentation, such
defective title may be the source of a completely legal and valid title in the hands of an innocent purchaser for value. Where
innocent third persons, relying on the correctness of the certificate of title thus issued, acquire rights over the property,
the court cannot disregard such rights and order the total cancellation of the certificate. The effect of such an outright
cancellation would be to impair public confidence in the certificate of title, for everyone dealing with property registered
under the Torrens system would have to inquire in every instance whether the title has been regularly or irregularly issued.
This is contrary to the evident purpose of the law. The Heirs of Victorino Sarili, namely, Isabel A. Sarili, et al. v. Pedro F.
Lagrosa, represented in this act by his Attorney-in-Fact, Lourdes Labios Mojica, G.R. No. 193517, January 15, 2014.

Torrens system; levy on attachment, duly registered, takes preference over a prior unregistered sale.[T]he settled rule
that levy on attachment, duly registered, takes preference over a prior unregistered sale. This result is a necessary
consequence of the fact that the [properties] involved [were] duly covered by the Torrens system which works under the
fundamental principle that registration is the operative act which gives validity to the transfer or creates a lien upon the
land. Sps. Bernadette and Rodulfo Vilbar v. Angelito L. Opinion, G.R. No. 176043. January 15, 2014.

December 2013 Philippine Supreme Court Decisions on Labor Law
Appeal; NLRC; accredited bonding company; revocation of authority is prospective in application. The respondents filed a
surety bond issued by Security Pacific Assurance Corporation (Security Pacific) on June 28, 2002. At that time,
Security Pacific was still an accredited bonding company. However, the NLRC revoked its accreditation on February 16,
2003. This subsequent revocation should not prejudice the respondents who relied in good faith on the then subsisting
accreditation of Security Pacific. In Del Rosario v. Philippine Journalists, Inc. (G.R. No. 181516, August 19, 2009), it was
held that a bonding companys revocation of authority is prospective in application. Nonetheless, the respondents should
post a new bond issued by an accredited bonding company in compliance with paragraph 4, Section 6, Rule 6 of the
NLRC Rules of Procedure, which states that [a] cash or surety bond shall be valid and effective from the date of deposit
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or posting, until the case is finally decided, resolved or terminated or the award satisfied. Wilgen Loon, et al. v. Power
Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Appeal; NLRC; bond; jurisdictional. Paragraph 2, Article 223 of the Labor Code provides that [i]n case of a judgment
involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond
issued by a reputable bonding company duly accredited by the NLRC in the amount equivalent to the monetary award in the
judgment appealed from. Contrary to the respondents claim, the issue of the appeal bonds validity may be raised for the
first time on appeal since its proper filing is a jurisdictional requirement. The requirement that the appeal bond should be
issued by an accredited bonding company is mandatory and jurisdictional. The rationale of requiring an appeal bond is to
discourage the employers from using an appeal to delay or evade the employees just and lawful claims. It is intended to
assure the workers that they will receive the money judgment in their favor if the employers appeal is dismissed. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Appeal; NLRC; verification; formal requisite, not jurisdictional. Neither the laws nor the rules require the verification of the
supplemental appeal. Furthermore, verification is a formal, not a jurisdictional, requirement. It is mainly intended to give
assurance that the matters alleged in the pleading are true and correct and not of mere speculation. Also, a supplemental
appeal is merely an addendum to the verified memorandum on appeal that was earlier filed in the case; hence, the
requirement for verification has been substantially complied. Wilgen Loon, et al. v. Power Master, Inc., et al., G.R. No.
189404, December 11, 2013.

Appeal; Rule 45; limited to review of questions of law. In this Rule 45 petition for review on certiorari, the Supreme Court
(SC) reviewed the Court of Appeals (CA) decision of a Rule 65 petition for certiorari. The Supreme Courts power of
review in such case is limited to legal errors that the CA might have committed in issuing its assailed decision, in contrast
with the review for jurisdictional errors which it undertakes in an original certiorari (Rule 65) action filed with it. The SC
examines the CA decision based on how it determined the presence or absence of grave abuse of discretion in the manner
by which the NLRC rendered its decision and not on the basis of whether the NLRC decision on the merits of the case was
correct. Moreover, the Courts power in a Rule 45 petition limits it to a review of questions of law raised against the
assailed CA decision. Baguio Central University v. Ignacio Gallente, G.R. No. 188267, December 2, 2013.

Attorneys fees; when entitled. An employee is entitled to an award of attorneys fees equivalent to ten percent (10%) of
the amount of the wages in actions for unlawful withholding of wages pursuant to Article 111 of the Labor Code. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Backwages; when entitled. In termination cases, the burden of proving just and valid cause for dismissing an employee from
his employment rests upon the employer. The employers failure to discharge this burden in the instant case arising from
their non-submission of evidence at the proceedings before the labor arbiter resulted in the finding that the dismissal is
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unjustified. Thus, the employees are entitled to the payment of backwages. Wilgen Loon, et al. v. Power Master, Inc., et al.,
G.R. No. 189404, December 11, 2013.

Deeds of release and quitclaim; grounds to invalidate. As a rule, deeds of release and quitclaim cannot bar employees from
demanding benefits to which they are legally entitled or from contesting the legality of their dismissal. The acceptance of
those benefits would not amount to estoppel. To excuse respondents from complying with the terms of their waivers, any
one of the following grounds must exist: (1) the employer used fraud or deceit in obtaining the waivers; (2) the consideration
the employer paid is incredible and unreasonable; or (3) the terms of the waiver are contrary to law, public order, public
policy, morals, or good customs or prejudicial to a third person with a right recognized by law. The Court concluded that
the instant case falls under the first situation.
As the ground for termination of employment was illegal, the quitclaims are deemed illegal because the employees consent
had been vitiated by mistake or fraud. The law looks with disfavor upon quitclaims and releases by employees pressured
into signing by unscrupulous employers minded to evade legal responsibilities. The circumstances show that petitioners
misrepresentation led its employees, specifically respondents herein, to believe that the company was suffering losses
which necessitated the implementation of the voluntary retirement and retrenchment programs, and eventually the
execution of the deeds of release, waiver and quitclaim. The amounts already received by respondents as consideration for
signing the releases and quitclaims, however, should be deducted from their respective monetary awards. Philippine Carpet
Manufacturing Corporation, et al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Disability benefits; principle of work-aggravation; concept of. Compensability may be established on the basis of the theory
of work aggravation if, by substantial evidence, it can be demonstrated that the working conditions aggravated or at least
contributed in the advancement of respondents cancer. As held in Rosario v. Denklav Marine, the burden is on the
beneficiaries to show a reasonable connection between the causative circumstances in the employment of the deceased
employee and his death or permanent total disability. In the present case, both parties failed to discharge their respective
burdens for petitioners, they failed to prove the non-work-relatedness of the disease; and for respondent, he failed to
prove that his work aggravated his condition. Thus, the Court had to resolve the case on some other basis. The Court held
that disability should be understood not more on its medical significance, but on the loss of earning capacity. Permanent
total disability means disablement of an employee to earn wages in the same kind of work or work of similar nature that he
was trained for or accustomed to perform, or any kind of work which a person of his mentality and attainment could do. It
does not mean absolute helplessness. Evidence of this condition can be found in a certification of fitness/unfitness to
work issued by the company-designated physician. In this case, records reveal that the medical report issued by the
company-designated oncologist was bereft of any certification that respondent remained fit to work as a seafarer despite
his cancer. This is important, according to the Court, since the certification is the document that contains the assessment
of his disability which can be questioned in case of disagreement as provided under Section 20 (B) (3) of the POEA-SEC.
In the absence of any certification, the law presumes that the employee remains in a state of temporary disability. Should
no certification be issued within 240 day maximum period, as in this case, the pertinent disability becomes permanent in
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nature. Accordingly, the Court affirmed respondents entitlement to permanent total disability benefits awarded to him.
Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Disability benefits; principle of work-relation; concept of. As a general rule, the principle of work-relation requires that the
disease in question must be one of those listed as an occupational disease under Sec. 32-A of the POEA-SEC.
Nevertheless, should it be not classified as occupational in nature, Section 20 (B) paragraph 4 of the POEA-SEC
provides that such diseases are disputably presumed as work-related.
In this case, it is undisputed that Nasopharyngeal Carcinoma (NPC) afflicted respondent while on board the petitioners
vessel. As a non-occupational disease, it has the disputable presumption of being work-related. This presumption obviously
works in the seafarers favor. Hence, unless contrary evidence is presented by the employers, the work-relatedness of the
disease must be sustained. The Court held that the petitioners, as employers, failed to disprove the presumption of NPCs
work-relatedness. The petitioners primarily relied on the medical report issued by Dr. Co Pefia which, however, failed to
make a categorical statement confirming the total absence of work relation. As the doctor opined only a probability, there
was no certainty that his condition was not work related. There being no certainty, the Court will lean in favor of the
seafarer consistent with the mandate of POEA-SEC to secure the best terms and conditions of employment for Filipino
workers. Hence, the presumption of NPCs work-relatedness stays. Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No.
204076, December 4, 2013.

Illegal dismissal; burden of proof. In termination cases, the burden of proving just and valid cause for dismissing an
employee from his employment rests upon the employer. The employers failure to discharge this burden results in the
finding that the dismissal is unjustified.
Failing to prove just and valid cause for the dismissal, the Court held that the petitioners are entitled to salary differential,
service incentive, holiday, and thirteenth month pays. As in illegal dismissal cases, the general rule is that the burden rests
on the defendant to prove payment rather than on the plaintiff to prove non-payment of these money claims. However, the
Court decided that they are not entitled to overtime and premium pays. The burden of proving entitlement to overtime pay
and premium pay for holidays and rest days rests on the employee because these are not incurred in the normal course of
business. In the present case, the petitioners failed to adduce any evidence that would show that they actually rendered
service in excess of the regular eight working hours a day, and that they in fact worked on holidays and rest days. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Labor cases; strict adherence to the technical rules of procedure is not required; when liberality allowed. In labor cases,
strict adherence to the technical rules of procedure is not required. Time and again, the Court has allowed evidence to be
submitted for the first time on appeal with the NLRC in the interest of substantial justice. Thus, it has consistently
supported the rule that labor officials should use all reasonable means to ascertain the facts in each case speedily and
objectively, without regard to technicalities of law or procedure, in the interest of due process. However, this liberal policy
should still be subject to rules of reason and fairplay. The liberality of procedural rules is qualified by two requirements: (1) a
!&

party should adequately explain any delay in the submission of evidence; and (2) a party should sufficiently prove the
allegations sought to be proven. The reason for these requirements is that the liberal application of the rules before quasi-
judicial agencies cannot be used to perpetuate injustice and hamper the just resolution of the case. Neither is the rule on
liberal construction a license to disregard the rules of procedure. In the present case, the Court held that the respondents
failed to adequately explain their delay in the submission of evidence and prove the allegations sought to be proven. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Labor; ground for valid dismissal; loss of trust and confidence; requisites. Loss of trust and confidence is a just cause for
dismissal under Article 282(c) of the Labor Code. Article 282(c) provides that an employer may terminate an employment
for fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative.
However, in order for the employer to properly invoke this ground, the employer must satisfy two conditions. First, the
employer must show that the employee concerned holds a position of trust and confidence. Second, the employer must
establish the existence of an act justifying the loss of trust and confidence. To be a valid cause for dismissal, the act that
betrays the employers trust must be real, i.e., founded on clearly established facts, and the employees breach of the trust
must be willful, i.e., it was done intentionally, knowingly and purposely, without justifiable excuse.
In Lopez v. Keppel Bank Philippines, Inc. (G.R. No. 176800, September 5, 2011), the Court repeated the guidelines for the
application of loss of confidence as follows: (1) loss of confidence should not be simulated; (2) it should not be used as a
subterfuge for causes which are improper, illegal or unjustified; (3) it may not be arbitrarily asserted in the face of
overwhelming evidence to the contrary; and (4) it must be genuine, not a mere afterthought to justify an earlier action
taken in bad faith.
As applied to the dismissal of managerial employees, employers as a rule enjoy wider latitude of discretion. They are not
required to present proof beyond reasonable doubt as the mere existence of a basis for believing that such employee has
breached the trust of the employer would suffice for the dismissal. Thus, as long as the employer has reasonable ground to
believe that the employee concerned is responsible for the purported misconduct, and the nature of his participation therein
renders him unworthy of the trust and confidence demanded of his position, the dismissal on this ground is valid.
The Court held that there was sufficient basis to dismiss the respondent for loss of trust and confidence. First, the Court
believed that the respondent held a position of trust and confidence because he was a managerial employee of the
petitioner. As the Dean of two of the petitioners departments, he was tasked, among others, to assist the school head in
all matters affecting the general policies of the entire institution, to direct and advise the students in their programs of
study and to approve their subject load and exercise educational leadership among his faculty. These tasks involved the
exercise of powers and prerogatives equivalent to managerial actions. Second, the Court ruled that the respondent
committed wilful breach of trust sufficient to justify dismissal. The heart of the loss-of-trust charge is the employees
betrayal of the employers trust. Damage aggravates the charge but its absence does not mitigate nor negate the
employees liability. The respondent betrayed his owed fidelity the moment he engaged in a venture that required him
to perform tasks and make calculated decisions which his duty to the petitioner would have equally required him to perform
or would have otherwise required him to oppose. The Court was convinced that actual conflict of interest existed when
!'

respondent sought to conduct review courses for nursing examination knowing that the petitioner was already offering
similar classes. The respondents good intentions were beside the point. Ultimately, the determinant is his deliberate
engagement in a venture that would have directly conflicted with the petitioners interests. If respondent merely intended to
help the petitioner and its students in increasing their chances of passing the Civil Service Examination, he could have just
offered, as part of the BCUs course curriculum, review classes for the Civil Service Examination instead of altogether
organizing a review center that obviously will offer the course to everyone minded to enroll. Baguio Central University v.
Ignacio Gallente, G.R. No. 188267, December 2, 2013.

Labor; valid dismissal; requisites. Our Constitution, statutes and jurisprudence uniformly guarantee to every employee or
worker tenurial security. What this means is that an employer shall not dismiss an employee except for just or authorized
cause and only after due process is observed. Thus, for an employees dismissal to be valid, the employer must meet these
basic requirements of: (1) just or authorized cause (which constitutes the substantive aspect of a valid dismissal); and (2)
observance of due process (the procedural aspect). Baguio Central University v. Ignacio Gallente, G.R. No. 188267,
December 2, 2013.

Petition for review on certiorari; only questions of law can be reviewed; exceptions.The well-entrenched rule in this
jurisdiction is that only questions of law may be entertained by the SC in a petition for review on certiorari under Rule 45.
This rule, however, is not absolute and admits certain exceptions, such as when the petitioner persuasively alleges that
there is insufficient or insubstantial evidence on record to support the factual findings of the tribunal or court a quo as
Section 5, Rule 133 of the Rules of Court states in express terms that in cases filed before administrative or quasi-
judicial bodies, a fact may be deemed established only if supported by substantial evidence. Jebsens Maritime, Inc., et al. v.
Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Probationary employment; concept of; probationer can only qualify upon fulfillment of the reasonable standards set for
permanent employment of a teaching personnel. Probationary employment refers to the trial stage or period during which
the employer examines the competency and qualifications of job applicants, and determines whether they are qualified to be
extended permanent employment status. Such an arrangement affords an employer the opportunity before the full force
of the guarantee of security of tenure comes into play to fully scrutinize and observe the fitness and worth of
probationers while on the job and to determine whether they would become proper and efficient employees. It also gives the
probationers the chance to prove to the employer that they possess the necessary qualities and qualifications to meet
reasonable standards for permanent employment.
Mere completion of the three-year probation, even with an above-average performance, does not guarantee that the
employee will automatically acquire a permanent employment status. It is settled jurisprudence that the probationer can
only qualify upon fulfillment of the reasonable standards set for permanent employment of a teaching personnel.
The Court ruled that the requirement to obtain a masters degree was made known to the petitioner. The contract she
signed clearly incorporates the rules, regulations, and employment conditions contained in the SSC Faculty Manual. The
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Manual provided for a criteria for permanency which includes, among others, the requirement that the faculty member must
have completed at least a masters degree. Viewed next to the statements and actions of Manaois i.e., the references to
obtaining a masters degree in her application letter, in the subsequent correspondences between her and SSC, and in the
letter seeking the extension of a teaching load for the school year 2003-2004; and her submission of certifications
from UP and from her thesis adviser the Court found that there is indeed substantial evidence proving that she knew
about the necessary academic qualifications to obtain the status of permanency. Jocelyn Herrera-Manaois v. St.
Scholasticas College, G.R. No. 188914, December 11, 2013.

Probationary employment; part-time member of the academic personnel; requisites to acquire permanence of employment
and security of tenure. Pursuant to the 1992 Manual of Regulations for Private Schools, private educational institutions in
the tertiary level may extend full-time faculty status only to those who possess, inter alia, a masters degree in the field
of study that will be taught. This minimum requirement is neither subject to the prerogative of the school nor to the
agreement between the parties. For all intents and purposes, this qualification must be deemed impliedly written in the
employment contracts between private educational institutions and prospective faculty members. The issue of whether
probationers were informed of this academic requirement before they were engaged as probationary employees is thus no
longer material, as those who are seeking to be educators are presumed to know these mandated qualifications. Thus, all
those who fail to meet the criteria under the 1992 Manual cannot legally attain the status of permanent full-time faculty
members, even if they have completed three years of satisfactory service.
Further, the Court stated that in line with academic freedom and constitutional autonomy, an institution of higher learning
has the discretion and prerogative to impose standards on its teachers and determine whether these have been met. Upon
conclusion of the probation period, the college or university, being the employer, has the sole prerogative to make a decision
on whether or not to re-hire the probationer. The probationer cannot automatically assert the acquisition of security of
tenure and force the employer to renew the employment contract. In the case at bar, petitioner failed to comply with the
stated academic qualifications required for the position of a permanent full-time faculty member. Jocelyn Herrera-Manaois
v. St. Scholasticas College, G.R. No. 188914, December 11, 2013.

Question of law; distinguished from a question of fact. A question of law arises when the doubt or controversy concerns
the correct application of law or jurisprudence to a certain set of facts. In contrast, a question of fact exists when a
doubt or difference arises as to the truth or falsehood of facts.
In this petition, the petitioner essentially asks the question whether, under the circumstances and the presented evidence,
the termination of respondents employment was valid. As framed, therefore, the question before the Court is a proscribed
factual issue that it cannot generally consider in this Rule 45 petition, except to the extent necessary to determine
whether the CA correctly found the NLRC in grave abuse of its discretion in considering and appreciating this factual
issue.
Nonetheless, as an exception to the Rule 45 requirement, the Court deemed it proper to review the conflicting factual
findings of the LA and the CA, on the one hand, and the NLRC, on the other. Such exception applies when, based on the
!)

records, the factual findings of the tribunals below are in conflict. Baguio Central University v. Ignacio Gallente, G.R. No.
188267, December 2, 2013.

Stare decisis; doctrine of. Under the doctrine of stare decisis, when a court has laid down a principle of law as applicable to
a certain state of facts, it will adhere to that principle and apply it to all future cases in which the facts are substantially
the same, even though the parties may be different. Where the facts are essentially different, however, stare decisis does
not apply because a perfectly sound principle as applied to one set of facts might be entirely inappropriate when a factual
variant is introduced.
This case and the Philippine Carpet Employees Association (PHILCEA) v. Hon. Sto. Tomas case (Philcea case; G.R. No.
168719, February 22, 2006), involve the same period which is March to April 2004; the issuance of the Memorandum
to employees informing them of the implementation of the cost reduction program; the implementation of the voluntary
retirement program and retrenchment program, except that this case involves different employees; the execution of deeds
of release, waiver, and quitclaim, and the acceptance of separation pay by the affected employees. As the respondents
here were similarly situated as the union members in the Philcea case, and considering that the questioned dismissal from
the service was based on the same grounds under the same circumstances, there is no need to re-litigate the issues
presented herein. In short, stare decisis applies and the Court deems it wise to adopt its earlier findings in the Philcea case
that there was no valid ground to terminate the services of the employees. Philippine Carpet Manufacturing Corporation, et
al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Substantial evidence; definition of. The assertions of respondent do not constitute as substantial evidence that a
reasonable mind might accept as adequate to support the conclusion that there is a causal relationship between his illness
and the working conditions on board the petitioners vessel. Although the Court has recognized as sufficient that work
conditions are proven to have contributed even to a small degree, such must, however, be reasonable, and anchored on
credible information. The claimant must, therefore, prove a convincing proposition other than by his mere allegations.
Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Termination of employment; authorized causes; retrenchment. The illegality of the basis of the implementation of both
voluntary retirement and retrenchment programs of petitioners had been thoroughly ruled upon by the Court in Philippine
Carpet Employees Association (PHILCEA) v. Hon. Sto. Tomas (G.R. No. 168719, February 22, 2006). It discussed the
requisites of both retrenchment and redundancy as authorized causes of termination and concluded that petitioners failed
to substantiate them. In ascertaining the bases of the termination of employees, it took into consideration petitioners claim
of business losses; the purchase of machinery and equipment after the termination, the declaration of cash dividends to
stockholders, the hiring of 100 new employees after the retrenchment, and the authorization of full blast overtime work for
six hours daily. These, said the Court, are inconsistent with petitioners claim that there was a slump in the demand for its
products which compelled them to implement the termination programs. In arriving at its conclusions, the Court took note of
petitioners net sales, gross and net profits, as well as net income. The Court, thus, reached the conclusion that the
!*

retrenchment effected by the company is invalid due to a substantive defect. Philippine Carpet Manufacturing Corporation,
et al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Termination of employment; ground; closure of business due to serious business losses; notice requirement. Article 297 of
the Labor Code provides that before any employee is terminated due to closure of business, it must give one (1) months
prior written notice to the employee and to the Department of Labor and Employment. In this relation, case law instructs
that it is the personal right of the employee to be personally informed of his proposed dismissal as well as the reasons
therefor; and such requirement of notice is not a mere technicality or formality which the employer may dispense with.
Since the purpose of previous notice is to, among others, give the employee some time to prepare for the eventual loss of
his job, the employer has the positive duty to inform each and every employee of their impending termination of employment.
To this end, jurisprudence states that an employers act of posting notices to this effect in conspicuous areas in the
workplace is not enough. Verily, for something as significant as the involuntary loss of ones employment, nothing less than
an individually-addressed notice of dismissal supplied to each worker is proper. The Court held that the Labor Arbiter,
NLRC, and Court of Appeals erred in ruling that SPI complied with the notice requirement when it merely posted various
copies of its notice of closure in conspicuous places within the business premises. SPI is required to serve individual written
notices of termination to its employees. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo
Philippines, Inc. Employees Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-
OLALIA, rep. by Porferia Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No.
173154./G.R. No. 173229, December 9, 2013

Termination of employment; authorized cause; closure of business due to serious business losses; separation pay. Closure
of business is the reversal of fortune of the employer whereby there is a complete cessation of business operations and/or
an actual locking-up of the doors of establishment, usually due to financial losses. Closure of business, as an authorized
cause for termination of employment, aims to prevent further financial drain upon an employer who cannot pay anymore his
employees since business has already stopped. In such a case, the employer is generally required to give separation benefits
to its employees, unless the closure is due to serious business losses. As explained in the case of Galaxie Steel Workers
Union (GSWU-NAFLU-KMU) v. NLRC (G.R. No. 165757, October 17, 2006): The Constitution, while affording full
protection to labor, nonetheless, recognizes the right of enterprises to reasonable returns on investments, and to
expansion and growth. In line with this protection afforded to business by the fundamental law, Article [297] of the Labor
Code clearly makes a policy distinction. It is only in instances of retrenchment to prevent losses and in cases of closures
or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses that
employees whose employment has been terminated as a result are entitled to separation pay. In other words, Article [297]
of the Labor Code does not obligate an employer to pay separation benefits when the closure is due to serious losses. To
require an employer to be generous when it is no longer in a position to do so, in our view, would be unduly oppressive,
unjust, and unfair to the employer. Ours is a system of laws, and the law in protecting the rights of the working man,
authorizes neither the oppression nor the self-destruction of the employer.
#+

In this case, the Labor Arbiter, NLRC, and the Court of Appeals all consistently found that petitioners indeed suffered
from serious business losses which resulted in its permanent shutdown and accordingly, held the companys closure to be
valid. It is a rule that absent any showing that the findings of fact of the labor tribunals and the appellate court are not
supported by evidence on record or the judgment is based on a misapprehension of facts, the Court shall not examine anew
the evidence submitted by the parties. Perforce, without any cogent reason to deviate from the findings on the validity of
respondents closure, the Court held that it is not obliged to give separation benefits to minority employees pursuant to
Article 297 of the Labor Code. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo Philippines,
Inc. Employees Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-OLALIA, rep. by
Porferia Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No. 173154./G.R. No.
173229, December 9, 2013.

Termination of employment due to closure; procedural infirmity; nominal damages as sanction. It is well to stress that while
respondent had a valid ground to terminate its employees, i.e., closure of business, its failure to comply with the proper
procedure for termination renders it liable to pay the employee nominal damages for such omission. Based on existing
jurisprudence, an employer which has a valid cause for dismissing its employee but conducts the dismissal with procedural
infirmity is liable to pay the employee nominal damages in the amount of P30,000.00 if the ground for dismissal is a just
cause, or the amount of P50,000.00 if the ground for dismissal is an authorized cause. However, case law exhorts that
in instances where the payment of such damages becomes impossible, unjust, or too burdensome, modification becomes
necessary in order to harmonize the disposition with the prevailing circumstance. In this case, considering that SPI closed
down its operations due to serious business losses and that said closure appears to have been done in good faith, the
Court as in the case of Industrial Timber Corporation v. Ababon (G.R. No. 164518, March 30, 2006), deems it just to
reduce the amount of nominal damages to be awarded to each of the minority employees from P50,000.00 to
Pl0,000.00. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo Philippines, Inc. Employees
Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-OLALIA, rep. by Porferia
Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No. 173154./G.R. No. 173229,
December 9, 2013.

labor january 6/4/14 2:33 PM
!

" Backwages; when awarded. As a general rule, backwages are granted to indemnify a dismissed employee for his loss
of earnings during the whole period that he is out of his job. Considering that an illegally dismissed employee is not
deemed to have left his employment, he is entitled to all the rights and privileges that accrue to him from the
employment. The grant of backwages to him is in furtherance and effectuation of the public objectives of the Labor
Code, and is in the nature of a command to the employer to make a public reparation for dismissing the employee in
violation of the Labor Code.
" The Court held that the respondents are not entitled to the payment of backwages. The Court, citing G&S Transport
Corporation v. Infante (G. R. No. 160303, September 13, 2007) stated that the principle of a fair days wage for
a fair days labor remains as the basic factor in determining the award thereof. An exception to the rule would be if
the laborer was able, willing and ready to work but was illegally locked out, suspended or dismissed or otherwise
illegally prevented from working. It is, however, required, for this exception to apply, that the strike be legal, a situation
which does not obtain in the case at bar. Visayas Community Medical Center (VCMC) formerly known as Metro Cebu
Community Hospital (MCCH) v. Erma Yballe, et al.,G.R. No. 196156, January 15, 2014

" Dismissal; burden of proof on employer. The burden is on the employer to prove that the termination was for valid
cause. Unsubstantiated accusations or baseless conclusions of the employer are insufficient legal justifications to
dismiss an employee. The unflinching rule in illegal dismissal cases is that the employer bears the burden of proof.
" One of CCBPIs policies requires that, on a daily basis, CCBPI Salesmen/Account Specialists must account for their
sales/collections and obtain clearance from the company Cashier before they are allowed to leave company premises
at the end of their shift and report for work the next day. If there is a shortage/failure to account, the concerned
Salesmen/Account Specialist is not allowed to leave the company premises until he settles the same. In addition,
shortages are deducted from the employees salaries. If CCBPI expects to proceed with its case against petitioner, it
should have negated this policy, for its existence and application are inextricably tied to CCBPIs accusations against
petitioner. In the first place, as petitioners employer, upon it lay the burden of proving by convincing evidence that he
was dismissed for cause. If petitioner continued to work until June 2004, this meant that he committed no
infraction, going by this company policy; it could also mean that any infraction or shortage/non-remittance incurred by
petitioner has been duly settled. Respondents decision to ignore this issue generates the belief that petitioner is telling
the truth, and that the alleged infractions are fabricated, or have been forgiven. Coupled with Macatangays statement
which remains equally unrefuted that the charges against petitioner are a scheme by local CCBPI management to
cover up problems in the Naga City Plant, the conclusion is indeed telling that petitioner is being wrongfully made to
account. Jonas Michael R. Garza v. Coca-Cola Bottlers Phils., Inc., et al.,G.R. No. 180972. January 20, 2014.
"
" Embezzlement; failure to remit collections. The irregularity attributed to petitioner with regard to the Asanza account
should fail as well. To be sure, Asanza herself confirmed that she did not make any payment in cash or check of
P8,160.00 covering the October 15, 2003 delivery for which petitioner is being held to account. This being the
case, petitioner could not be charged with embezzlement for failure to remit funds which he has not collected. There
#

was nothing to embezzle or remit because the customer made no payment yet. It may appear from Official Receipt No.
303203 issued to Asanza that the October 15 delivery of products to her has been paid; but as admitted by her,
she has not paid for the said delivered products. The reason for petitioners issuance of said official receipt to Asanza
is the latters concurrent promise that she would immediately issue the check covering the said amount, which she
failed to do. Jonas Michael R. Garza v. Coca-Cola Bottlers Phils., Inc., et al.,G.R. No. 180972. January 20, 2014
"
" Grave abuse of discretion; concept of. Having established through substantial evidence that respondents injury was
self-inflicted and, hence, not compensable pursuant to Section 20 (D) of the 1996 POEA-SEC, no grave abuse of
discretion can be imputed against the NLRC in upholding LAs decision to dismiss respondents complaint for disability
benefits. It is well-settled that an act of a court or tribunal can only be considered to be tainted with grave abuse of
discretion when such act is done in a capricious or whimsical exercise of judgment as is equivalent to lack of
jurisdiction. INC Shipmanagement, Inc. Captain Sigfredo E. Monterroyo and/or Interorient Navigation Limited v.
Alexander L. Moradas,G.R. No., January 15, 2014
"
" Illegal strike and illegal acts during the strike; distinction between union members and union officers in determining
when they lose their employment status. The Supreme Court stressed that the law makes a distinction between union
members and union officers. A union member who merely participates in an illegal strike may not be terminated from
employment. It is only when he commits illegal acts during a strike that he may be declared to have lost employment
status. In contrast, a union officer may be terminated from employment for knowingly participating in an illegal strike
or participates in the commission of illegal acts during a strike. The law grants the employer the option of declaring a
union officer who participated in an illegal strike as having lost his employment. It possesses the right and prerogative
to terminate the union officers from service.
" NAMA-MCCH-NFL is not a legitimate labor organization, thus, the strike staged by its leaders and members was
declared illegal. The union leaders who conducted the illegal strike despite knowledge that NAMA-MCCH-NFL is not a
duly registered labor union were declared to have been validly terminated by petitioner. However, as to the respondents
who were mere union members, it was not shown that they committed any illegal act during the strike. The Labor
Arbiter and the NLRC were one in finding that respondents actively supported the concerted protest activities, signed
the collective reply of union members manifesting that they launched the mass actions to protest managements
refusal to negotiate a new CBA, refused to appear in the investigations scheduled by petitioner because it was the
unions stand that they would only attend these investigations as a group, and failed to heed petitioners final directive
for them to desist from further taking part in the illegal strike. The CA, on the other hand, found that respondents
participation in the strike was limited to the wearing of armbands. Since an ordinary striking worker cannot be
dismissed for such mere participation in the illegal strike, the CA correctly ruled that respondents were illegally
dismissed. However, the CA erred in awarding respondents full back wages and ordering their reinstatement despite
the prevailing circumstances. Visayas Community Medical Center (VCMC) formerly known as Metro Cebu
Commnunity Hospital (MCCH) v. Erma Yballe, et al.,G.R. No. 196156, January 15, 2014
$

"
" Labor law; kinds of employment; casual employment; requisites. Casual employment, the third kind of employment
arrangement, refers to any other employment arrangement that does not fall under any of the first two categories, i.e.,
regular or project/seasonal. Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January
15, 2014.
"
" Labor law; kinds of employment; fixed term employment; requisites. The Labor Code does not mention another
employment arrangement contractual or fixed term employment (or employment for a term) which, if not for the
fixed term, should fall under the category of regular employment in view of the nature of the employees engagement,
which is to perform an activity usually necessary or desirable in the employers business.
" In Brent School, Inc. v. Zamora (G.R. No. L-48494, February 5, 1990), the Court, for the first time,
recognized and resolved the anomaly created by a narrow and literal interpretation of Article 280 of the Labor
Code that appears to restrict the employees right to freely stipulate with his employer on the duration of his
engagement. In this case, the Court upheld the validity of the fixed-term
employment agreed upon by the employer, Brent School, Inc., and the employee, Dorotio Alegre, declaring that the
restrictive clause in Article 280 should be construed to refer to the substantive evil that the Code itself x x x
singled out: agreements entered into precisely to circumvent security of tenure. It should have no application to
instances where [the] fixed period of employment was agreed upon knowingly and voluntarily by the parties x x x
absent any x x x circumstances vitiating [the employees] consent, or where [the facts satisfactorily show] that the
employer and [the] employee dealt with each other on more or less equal terms[.] The indispensability or desirability of
the activity performed by the employee will not preclude the parties from entering into an otherwise valid fixed term
employment agreement; a definite period of employment does not essentially contradict the nature of the employees
duties as necessary and desirable to the usual business or trade of the employer.
" Nevertheless, where the circumstances evidently show that the
employer imposed the period precisely to preclude the employee from acquiring tenurial security, the law and this
Court will not hesitate to strike down or disregard the period as contrary to public policy, morals, etc. In such a case,
the general restrictive rule under Article 280 of the Labor Code will apply and the employee shall be deemed regular.
Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January 15, 2014.
"
" Labor law; kinds of employment; nature of the employment depends on the nature of the activities to be performed by
the employee. The nature of the employment does not depend solely on the will or word of the employer or on the
procedure for hiring and the manner of designating the employee. Rather, the nature of the employment depends on
the nature of the activities to be performed by the employee, taking into account the nature of the employers
business, the duration and scope of work to be done, and, in some cases, even the length of time of the performance
and its continued existence. Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January
15, 2014.
%

"
" Labor law; kinds of employment; project employment; requisites; length of time not
controlling. A project employment, on the other hand, contemplates on arrangement whereby the employment
has been fixed for a specific project or undertaking whose completion or termination has been determined at the
time of the engagement of the employee[.] Two requirements, therefore, clearly need to be satisfied to remove the
engagement from the presumption of regularity of employment, namely: (1) designation of a specific project or
undertaking for which the employee is hired; and (2) clear determination of the completion or termination of the project
at the time of the employees engagement. The services of the project employees are legally and automatically
terminated upon the end or completion of the project as the employees services are coterminous with the project.
Unlike in a regular employment under Article 280 of the Labor Code, however, the length of time of the asserted
project employees engagement is not controlling as the employment may, in fact, last for more than a year,
depending on the needs or circumstances of the project. Nevertheless, this length of time (or the continuous rehiring
of the employee even after the cessation of the project) may serve as a badge of regular employment when the
activities performed by the purported project employee are necessary and indispensable to the usual business or
trade of the employer. In this latter case, the law will regard the arrangement as regular employment. Universal Robina
Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January 15, 2014.
"
" Labor law; kinds of employment; regular employment; requisites. Article 280 of the Labor Code provides for three
kinds of employment arrangements, namely: regular, project/seasonal and casual. Regular employment refers to that
arrangement whereby the employee has been engaged to perform activities which are usually necessary or desirable in
the usual business or trade of the employer[.] Under this definition, the primary standard that determines
regular employment is the reasonable connection between the particular activity performed by the employee and
the usual business or trade of the employer; the emphasis is on the necessity or desirability of the employees
activity. Thus, when the employee performs activities considered necessary and desirable to the overall business
scheme of the employer, the law regards the employee as regular.
" By way of an exception, paragraph 2, Article 280 of the Labor Code also considers as regular, a casual employment
arrangement when the casual employees engagement is made to last for at least one year, whether the service is
continuous or broken. The controlling test in this arrangement is the length of time during which the employee is
engaged. Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January 15, 2014.
"
" Labor law; kinds of employment; seasonal employment; requisites.
Seasonal employment operates much in the same way as project employment, albeit it involves work or service
that is seasonal in nature or lasting for the duration of the season. As with project employment,
although the seasonal employment arrangement involves work that is seasonal or periodic in nature, the
employment itself is not automatically considered seasonal so as to prevent the employee from attaining regular
status. To exclude the asserted seasonal employee from those classified as regular employees, the employer must
&

show that: (1) the employee must be performing work or services that are seasonal in nature; and (2) he had been
employed for the duration of the season. Hence, when the seasonal workers are continuously and repeatedly hired
to perform the same tasks or activities for several seasons or even after the cessation of the season, this length of
time may likewise serve as badge of regular employment. In fact, even though denominated as seasonal workers, if
these workers are called to work from time to time and are only temporarily laid off during the off-season, the law
does not consider them separated from the service during the off-season period. The law simply considers these
seasonal workers on leave until re-employed. Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No.
186439. January 15, 2014.
"
" Overseas employment; that the entitlement of seamen on overseas work to disability benefits is a matter governed,
not only by medical findings, but by law and by contract. With respect to the applicable rules, it is doctrinal that the
entitlement of seamen on overseas work to disability benefits is a matter governed, not only by medical findings, but
by law and by contract. The material statutory provisions are Articles 191 to 193 under Chapter VI (Disability
Benefits) of the Labor Code, in relation [to] Rule X of the Rules and Regulations Implementing Book IV of the Labor
Code. By contract, the POEA-SEC, as provided under Department Order No. 4, series of 2000 of the Department
of Labor and Employment, and the parties Collective Bargaining Agreement bind the seaman and his employer to each
other.
" In the foregoing light, the Court observes that respondent executed his contract of employment on July 17, 2000,
incorporating therein the terms and conditions of the 2000 POEA-SEC which took effect on June 25, 2000.
However, since the implementation of the provisions of the foregoing 2000 POEA-SEC was temporarily suspended
by the Court on September 11, 2000, particularly Section 20, paragraphs (A), (B), and (D) thereof, and was lifted
only on June 5, 2002, through POEA Memorandum Circular No. 2, series of 2002, the determination of
respondents entitlement to the disability benefits should be resolved under the provisions of the 1996 POEA-SEC as
it was, effectively, the governing circular at the time respondents employment contract was executed. INC
Shipmanagement, Inc. Captain Sigfredo E. Monterroyo and/or Interorient Navigation Limited v. Alexander L.
Moradas,G.R. No., January 15, 2014
"
" Payment of separation pay as alternative relief for union members who were dismissed for having participated in an
illegal strike is in lieu of reinstatement; circumstances when applicable. The alternative relief for union members who
were dismissed for having participated in an illegal strike is the payment of separation pay in lieu of reinstatement
under the following circumstances: (a) when reinstatement can no longer be effected in view of the passage of a
long period of time or because of the realities of the situation; (b) reinstatement is inimical to the employers interest;
(c) reinstatement is no longer feasible; (d) reinstatement does not serve the best interests of the parties involved; (e)
the employer is prejudiced by the workers continued employment; (f) facts that make execution unjust or inequitable
have supervened; or (g) strained relations between the employer and employee.
'

" The Court ruled that the grant of separation pay to respondents is the appropriate relief under the circumstances
considering that 15 years had lapsed from the onset of this labor dispute, and in view of strained relations that
ensued, in addition to the reality of replacements already hired by the hospital which had apparently recovered from its
huge losses, and with many of the petitioners either employed elsewhere, already old and sickly, or otherwise
incapacitated. Visayas Community Medical Center (VCMC) formerly known as Metro Cebu Commnunity Hospital
(MCCH) v. Erma Yballe, et al.,G.R. No. 196156, January 15, 2014
"
" Rule 45; only questions of law are allowed in a petition for review on certiorari. It is a settled rule in this jurisdiction
that only questions of law are allowed in a petition for review on certiorari. The Courts power of review in a Rule 45
petition is limited to resolving matters pertaining to any perceived legal errors, which the CA may have committed in
issuing the assailed decision. In reviewing the legal correctness of the CAs Rule 65 decision in a labor case, the
Court examines the CA decision in the context that it determined whether or not there is grave abuse of discretion in
the NLRC decision subject of its review and not on the basis of whether the NLRC decision on the merits of the case
was correct. Universal Robina Sugar Milling Corporation and Rene Cabati, G.R. No. 186439. January 15, 2014.
"
" Rule 45; the Courts jurisdiction in a Rule 45 petition is limited to the review of pure questions of law; exceptions.
The Courts jurisdiction in cases brought before it from the CA via Rule 45 of the Rules of Court is generally limited
to reviewing errors of law. The Court is not the proper venue to consider a factual issue as it is not a trier of facts.
This rule, however, is not ironclad and a departure therefrom may be warranted where the findings of fact of the CA
are contrary to the findings and conclusions of the NLRC and LA, as in this case. In this regard, there is therefore a
need to review the records to determine which of them should be preferred as more conformable to evidentiary facts.
INC Shipmanagement, Inc. Captain Sigfredo E. Monterroyo and/or Interorient Navigation Limited v. Alexander L.
Moradas,G.R. No., January 15, 2014.
"
" Section 20 (B) of the 1996 POEA-SEC; an employer shall be liable for the injury or illness suffered by a seafarer
during the term of his contract; exception. The prevailing rule under Section 20 (B) of the 1996 POEA-SEC on
compensation and benefits for injury or illness was that an employer shall be liable for the injury or illness suffered by
a seafarer during the term of his contract. To be compensable, the injury or illness must be proven to have been
contracted during the term of the contract. However, the employer may be exempt from liability if he can successfully
prove that the cause of the seamans injury was directly attributable to his deliberate or willful act as provided under
Section 20 (D) thereof, to wit:
" D. No compensation shall be payable in respect of any injury, incapacity, disability or death of the seafarer resulting
from his willful or criminal act, provided however, that the employer can prove that such injury, incapacity, disability or
death is directly attributable to seafarer.
(

" Hence, the onus probandi falls on the petitioners herein to establish or substantiate their claim that the respondents
injury was caused by his willful act with the requisite quantum of evidence. INC Shipmanagement, Inc. Captain Sigfredo
E. Monterroyo and/or Interorient Navigation Limited v. Alexander L. Moradas,G.R. No., January 15, 2014
"
" Substantial evidence; concept of. In labor cases, as in other administrative proceedings, only substantial evidence or
such relevant evidence as a reasonable mind might accept as sufficient to support a conclusion is required. To note,
considering that substantial evidence is an evidentiary threshold, the Court, on exceptional cases, may assess the
factual determinations made by the NLRC in a particular case.
" The Court ruled that NLRC had cogent legal bases to conclude that petitioners have successfully discharged the
burden of proving by substantial evidence that respondents injury was directly attributable to himself. Records bear
out circumstances which all lead to the reasonable conclusion that respondent was responsible for the flooding and
burning incidents. While respondent contended that the affidavits and statements of the vessels officers and his
fellow crew members should not be given probative value as they were biased, self-serving,
and mere hearsay, he nonetheless failed to present any evidence to substantiate his own theory. Besides, as
correctly pointed out by the NLRC, the corroborating affidavits and statements of the vessels officers
and crew members must be taken as a whole and cannot just be perfunctorily dismissed as self-serving absent
any showing that they were lying when they made the statements therein. INC Shipmanagement, Inc. Captain Sigfredo
E. Monterroyo and/or Interorient Navigation Limited v. Alexander L. Moradas,G.R. No., January 15, 2014


December 2013 Philippine Supreme Court Decisions on Labor Law
Appeal; NLRC; accredited bonding company; revocation of authority is prospective in application. The respondents filed a
surety bond issued by Security Pacific Assurance Corporation (Security Pacific) on June 28, 2002. At that time,
Security Pacific was still an accredited bonding company. However, the NLRC revoked its accreditation on February 16,
2003. This subsequent revocation should not prejudice the respondents who relied in good faith on the then subsisting
accreditation of Security Pacific. In Del Rosario v. Philippine Journalists, Inc. (G.R. No. 181516, August 19, 2009), it was
held that a bonding companys revocation of authority is prospective in application. Nonetheless, the respondents should
post a new bond issued by an accredited bonding company in compliance with paragraph 4, Section 6, Rule 6 of the
NLRC Rules of Procedure, which states that [a] cash or surety bond shall be valid and effective from the date of deposit
or posting, until the case is finally decided, resolved or terminated or the award satisfied. Wilgen Loon, et al. v. Power
Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Appeal; NLRC; bond; jurisdictional. Paragraph 2, Article 223 of the Labor Code provides that [i]n case of a judgment
involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond
issued by a reputable bonding company duly accredited by the NLRC in the amount equivalent to the monetary award in the
judgment appealed from. Contrary to the respondents claim, the issue of the appeal bonds validity may be raised for the
)

first time on appeal since its proper filing is a jurisdictional requirement. The requirement that the appeal bond should be
issued by an accredited bonding company is mandatory and jurisdictional. The rationale of requiring an appeal bond is to
discourage the employers from using an appeal to delay or evade the employees just and lawful claims. It is intended to
assure the workers that they will receive the money judgment in their favor if the employers appeal is dismissed. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Appeal; NLRC; verification; formal requisite, not jurisdictional. Neither the laws nor the rules require the verification of the
supplemental appeal. Furthermore, verification is a formal, not a jurisdictional, requirement. It is mainly intended to give
assurance that the matters alleged in the pleading are true and correct and not of mere speculation. Also, a supplemental
appeal is merely an addendum to the verified memorandum on appeal that was earlier filed in the case; hence, the
requirement for verification has been substantially complied. Wilgen Loon, et al. v. Power Master, Inc., et al., G.R. No.
189404, December 11, 2013.

Appeal; Rule 45; limited to review of questions of law. In this Rule 45 petition for review on certiorari, the Supreme Court
(SC) reviewed the Court of Appeals (CA) decision of a Rule 65 petition for certiorari. The Supreme Courts power of
review in such case is limited to legal errors that the CA might have committed in issuing its assailed decision, in contrast
with the review for jurisdictional errors which it undertakes in an original certiorari (Rule 65) action filed with it. The SC
examines the CA decision based on how it determined the presence or absence of grave abuse of discretion in the manner
by which the NLRC rendered its decision and not on the basis of whether the NLRC decision on the merits of the case was
correct. Moreover, the Courts power in a Rule 45 petition limits it to a review of questions of law raised against the
assailed CA decision. Baguio Central University v. Ignacio Gallente, G.R. No. 188267, December 2, 2013.

Attorneys fees; when entitled. An employee is entitled to an award of attorneys fees equivalent to ten percent (10%) of
the amount of the wages in actions for unlawful withholding of wages pursuant to Article 111 of the Labor Code. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Backwages; when entitled. In termination cases, the burden of proving just and valid cause for dismissing an employee from
his employment rests upon the employer. The employers failure to discharge this burden in the instant case arising from
their non-submission of evidence at the proceedings before the labor arbiter resulted in the finding that the dismissal is
unjustified. Thus, the employees are entitled to the payment of backwages. Wilgen Loon, et al. v. Power Master, Inc., et al.,
G.R. No. 189404, December 11, 2013.

Deeds of release and quitclaim; grounds to invalidate. As a rule, deeds of release and quitclaim cannot bar employees from
demanding benefits to which they are legally entitled or from contesting the legality of their dismissal. The acceptance of
those benefits would not amount to estoppel. To excuse respondents from complying with the terms of their waivers, any
one of the following grounds must exist: (1) the employer used fraud or deceit in obtaining the waivers; (2) the consideration
*

the employer paid is incredible and unreasonable; or (3) the terms of the waiver are contrary to law, public order, public
policy, morals, or good customs or prejudicial to a third person with a right recognized by law. The Court concluded that
the instant case falls under the first situation.
As the ground for termination of employment was illegal, the quitclaims are deemed illegal because the employees consent
had been vitiated by mistake or fraud. The law looks with disfavor upon quitclaims and releases by employees pressured
into signing by unscrupulous employers minded to evade legal responsibilities. The circumstances show that petitioners
misrepresentation led its employees, specifically respondents herein, to believe that the company was suffering losses
which necessitated the implementation of the voluntary retirement and retrenchment programs, and eventually the
execution of the deeds of release, waiver and quitclaim. The amounts already received by respondents as consideration for
signing the releases and quitclaims, however, should be deducted from their respective monetary awards. Philippine Carpet
Manufacturing Corporation, et al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Disability benefits; principle of work-aggravation; concept of. Compensability may be established on the basis of the theory
of work aggravation if, by substantial evidence, it can be demonstrated that the working conditions aggravated or at least
contributed in the advancement of respondents cancer. As held in Rosario v. Denklav Marine, the burden is on the
beneficiaries to show a reasonable connection between the causative circumstances in the employment of the deceased
employee and his death or permanent total disability. In the present case, both parties failed to discharge their respective
burdens for petitioners, they failed to prove the non-work-relatedness of the disease; and for respondent, he failed to
prove that his work aggravated his condition. Thus, the Court had to resolve the case on some other basis. The Court held
that disability should be understood not more on its medical significance, but on the loss of earning capacity. Permanent
total disability means disablement of an employee to earn wages in the same kind of work or work of similar nature that he
was trained for or accustomed to perform, or any kind of work which a person of his mentality and attainment could do. It
does not mean absolute helplessness. Evidence of this condition can be found in a certification of fitness/unfitness to
work issued by the company-designated physician. In this case, records reveal that the medical report issued by the
company-designated oncologist was bereft of any certification that respondent remained fit to work as a seafarer despite
his cancer. This is important, according to the Court, since the certification is the document that contains the assessment
of his disability which can be questioned in case of disagreement as provided under Section 20 (B) (3) of the POEA-SEC.
In the absence of any certification, the law presumes that the employee remains in a state of temporary disability. Should
no certification be issued within 240 day maximum period, as in this case, the pertinent disability becomes permanent in
nature. Accordingly, the Court affirmed respondents entitlement to permanent total disability benefits awarded to him.
Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Disability benefits; principle of work-relation; concept of. As a general rule, the principle of work-relation requires that the
disease in question must be one of those listed as an occupational disease under Sec. 32-A of the POEA-SEC.
Nevertheless, should it be not classified as occupational in nature, Section 20 (B) paragraph 4 of the POEA-SEC
provides that such diseases are disputably presumed as work-related.
!+

In this case, it is undisputed that Nasopharyngeal Carcinoma (NPC) afflicted respondent while on board the petitioners
vessel. As a non-occupational disease, it has the disputable presumption of being work-related. This presumption obviously
works in the seafarers favor. Hence, unless contrary evidence is presented by the employers, the work-relatedness of the
disease must be sustained. The Court held that the petitioners, as employers, failed to disprove the presumption of NPCs
work-relatedness. The petitioners primarily relied on the medical report issued by Dr. Co Pefia which, however, failed to
make a categorical statement confirming the total absence of work relation. As the doctor opined only a probability, there
was no certainty that his condition was not work related. There being no certainty, the Court will lean in favor of the
seafarer consistent with the mandate of POEA-SEC to secure the best terms and conditions of employment for Filipino
workers. Hence, the presumption of NPCs work-relatedness stays. Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No.
204076, December 4, 2013.

Illegal dismissal; burden of proof. In termination cases, the burden of proving just and valid cause for dismissing an
employee from his employment rests upon the employer. The employers failure to discharge this burden results in the
finding that the dismissal is unjustified.
Failing to prove just and valid cause for the dismissal, the Court held that the petitioners are entitled to salary differential,
service incentive, holiday, and thirteenth month pays. As in illegal dismissal cases, the general rule is that the burden rests
on the defendant to prove payment rather than on the plaintiff to prove non-payment of these money claims. However, the
Court decided that they are not entitled to overtime and premium pays. The burden of proving entitlement to overtime pay
and premium pay for holidays and rest days rests on the employee because these are not incurred in the normal course of
business. In the present case, the petitioners failed to adduce any evidence that would show that they actually rendered
service in excess of the regular eight working hours a day, and that they in fact worked on holidays and rest days. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

Labor cases; strict adherence to the technical rules of procedure is not required; when liberality allowed. In labor cases,
strict adherence to the technical rules of procedure is not required. Time and again, the Court has allowed evidence to be
submitted for the first time on appeal with the NLRC in the interest of substantial justice. Thus, it has consistently
supported the rule that labor officials should use all reasonable means to ascertain the facts in each case speedily and
objectively, without regard to technicalities of law or procedure, in the interest of due process. However, this liberal policy
should still be subject to rules of reason and fairplay. The liberality of procedural rules is qualified by two requirements: (1) a
party should adequately explain any delay in the submission of evidence; and (2) a party should sufficiently prove the
allegations sought to be proven. The reason for these requirements is that the liberal application of the rules before quasi-
judicial agencies cannot be used to perpetuate injustice and hamper the just resolution of the case. Neither is the rule on
liberal construction a license to disregard the rules of procedure. In the present case, the Court held that the respondents
failed to adequately explain their delay in the submission of evidence and prove the allegations sought to be proven. Wilgen
Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013.

!!

Labor; ground for valid dismissal; loss of trust and confidence; requisites. Loss of trust and confidence is a just cause for
dismissal under Article 282(c) of the Labor Code. Article 282(c) provides that an employer may terminate an employment
for fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative.
However, in order for the employer to properly invoke this ground, the employer must satisfy two conditions. First, the
employer must show that the employee concerned holds a position of trust and confidence. Second, the employer must
establish the existence of an act justifying the loss of trust and confidence. To be a valid cause for dismissal, the act that
betrays the employers trust must be real, i.e., founded on clearly established facts, and the employees breach of the trust
must be willful, i.e., it was done intentionally, knowingly and purposely, without justifiable excuse.
In Lopez v. Keppel Bank Philippines, Inc. (G.R. No. 176800, September 5, 2011), the Court repeated the guidelines for the
application of loss of confidence as follows: (1) loss of confidence should not be simulated; (2) it should not be used as a
subterfuge for causes which are improper, illegal or unjustified; (3) it may not be arbitrarily asserted in the face of
overwhelming evidence to the contrary; and (4) it must be genuine, not a mere afterthought to justify an earlier action
taken in bad faith.
As applied to the dismissal of managerial employees, employers as a rule enjoy wider latitude of discretion. They are not
required to present proof beyond reasonable doubt as the mere existence of a basis for believing that such employee has
breached the trust of the employer would suffice for the dismissal. Thus, as long as the employer has reasonable ground to
believe that the employee concerned is responsible for the purported misconduct, and the nature of his participation therein
renders him unworthy of the trust and confidence demanded of his position, the dismissal on this ground is valid.
The Court held that there was sufficient basis to dismiss the respondent for loss of trust and confidence. First, the Court
believed that the respondent held a position of trust and confidence because he was a managerial employee of the
petitioner. As the Dean of two of the petitioners departments, he was tasked, among others, to assist the school head in
all matters affecting the general policies of the entire institution, to direct and advise the students in their programs of
study and to approve their subject load and exercise educational leadership among his faculty. These tasks involved the
exercise of powers and prerogatives equivalent to managerial actions. Second, the Court ruled that the respondent
committed wilful breach of trust sufficient to justify dismissal. The heart of the loss-of-trust charge is the employees
betrayal of the employers trust. Damage aggravates the charge but its absence does not mitigate nor negate the
employees liability. The respondent betrayed his owed fidelity the moment he engaged in a venture that required him
to perform tasks and make calculated decisions which his duty to the petitioner would have equally required him to perform
or would have otherwise required him to oppose. The Court was convinced that actual conflict of interest existed when
respondent sought to conduct review courses for nursing examination knowing that the petitioner was already offering
similar classes. The respondents good intentions were beside the point. Ultimately, the determinant is his deliberate
engagement in a venture that would have directly conflicted with the petitioners interests. If respondent merely intended to
help the petitioner and its students in increasing their chances of passing the Civil Service Examination, he could have just
offered, as part of the BCUs course curriculum, review classes for the Civil Service Examination instead of altogether
organizing a review center that obviously will offer the course to everyone minded to enroll. Baguio Central University v.
Ignacio Gallente, G.R. No. 188267, December 2, 2013.
!#


Labor; valid dismissal; requisites. Our Constitution, statutes and jurisprudence uniformly guarantee to every employee or
worker tenurial security. What this means is that an employer shall not dismiss an employee except for just or authorized
cause and only after due process is observed. Thus, for an employees dismissal to be valid, the employer must meet these
basic requirements of: (1) just or authorized cause (which constitutes the substantive aspect of a valid dismissal); and (2)
observance of due process (the procedural aspect). Baguio Central University v. Ignacio Gallente, G.R. No. 188267,
December 2, 2013.

Petition for review on certiorari; only questions of law can be reviewed; exceptions.The well-entrenched rule in this
jurisdiction is that only questions of law may be entertained by the SC in a petition for review on certiorari under Rule 45.
This rule, however, is not absolute and admits certain exceptions, such as when the petitioner persuasively alleges that
there is insufficient or insubstantial evidence on record to support the factual findings of the tribunal or court a quo as
Section 5, Rule 133 of the Rules of Court states in express terms that in cases filed before administrative or quasi-
judicial bodies, a fact may be deemed established only if supported by substantial evidence. Jebsens Maritime, Inc., et al. v.
Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Probationary employment; concept of; probationer can only qualify upon fulfillment of the reasonable standards set for
permanent employment of a teaching personnel. Probationary employment refers to the trial stage or period during which
the employer examines the competency and qualifications of job applicants, and determines whether they are qualified to be
extended permanent employment status. Such an arrangement affords an employer the opportunity before the full force
of the guarantee of security of tenure comes into play to fully scrutinize and observe the fitness and worth of
probationers while on the job and to determine whether they would become proper and efficient employees. It also gives the
probationers the chance to prove to the employer that they possess the necessary qualities and qualifications to meet
reasonable standards for permanent employment.
Mere completion of the three-year probation, even with an above-average performance, does not guarantee that the
employee will automatically acquire a permanent employment status. It is settled jurisprudence that the probationer can
only qualify upon fulfillment of the reasonable standards set for permanent employment of a teaching personnel.
The Court ruled that the requirement to obtain a masters degree was made known to the petitioner. The contract she
signed clearly incorporates the rules, regulations, and employment conditions contained in the SSC Faculty Manual. The
Manual provided for a criteria for permanency which includes, among others, the requirement that the faculty member must
have completed at least a masters degree. Viewed next to the statements and actions of Manaois i.e., the references to
obtaining a masters degree in her application letter, in the subsequent correspondences between her and SSC, and in the
letter seeking the extension of a teaching load for the school year 2003-2004; and her submission of certifications
from UP and from her thesis adviser the Court found that there is indeed substantial evidence proving that she knew
about the necessary academic qualifications to obtain the status of permanency. Jocelyn Herrera-Manaois v. St.
Scholasticas College, G.R. No. 188914, December 11, 2013.
!$


Probationary employment; part-time member of the academic personnel; requisites to acquire permanence of employment
and security of tenure. Pursuant to the 1992 Manual of Regulations for Private Schools, private educational institutions in
the tertiary level may extend full-time faculty status only to those who possess, inter alia, a masters degree in the field
of study that will be taught. This minimum requirement is neither subject to the prerogative of the school nor to the
agreement between the parties. For all intents and purposes, this qualification must be deemed impliedly written in the
employment contracts between private educational institutions and prospective faculty members. The issue of whether
probationers were informed of this academic requirement before they were engaged as probationary employees is thus no
longer material, as those who are seeking to be educators are presumed to know these mandated qualifications. Thus, all
those who fail to meet the criteria under the 1992 Manual cannot legally attain the status of permanent full-time faculty
members, even if they have completed three years of satisfactory service.
Further, the Court stated that in line with academic freedom and constitutional autonomy, an institution of higher learning
has the discretion and prerogative to impose standards on its teachers and determine whether these have been met. Upon
conclusion of the probation period, the college or university, being the employer, has the sole prerogative to make a decision
on whether or not to re-hire the probationer. The probationer cannot automatically assert the acquisition of security of
tenure and force the employer to renew the employment contract. In the case at bar, petitioner failed to comply with the
stated academic qualifications required for the position of a permanent full-time faculty member. Jocelyn Herrera-Manaois
v. St. Scholasticas College, G.R. No. 188914, December 11, 2013.

Question of law; distinguished from a question of fact. A question of law arises when the doubt or controversy concerns
the correct application of law or jurisprudence to a certain set of facts. In contrast, a question of fact exists when a
doubt or difference arises as to the truth or falsehood of facts.
In this petition, the petitioner essentially asks the question whether, under the circumstances and the presented evidence,
the termination of respondents employment was valid. As framed, therefore, the question before the Court is a proscribed
factual issue that it cannot generally consider in this Rule 45 petition, except to the extent necessary to determine
whether the CA correctly found the NLRC in grave abuse of its discretion in considering and appreciating this factual
issue.
Nonetheless, as an exception to the Rule 45 requirement, the Court deemed it proper to review the conflicting factual
findings of the LA and the CA, on the one hand, and the NLRC, on the other. Such exception applies when, based on the
records, the factual findings of the tribunals below are in conflict. Baguio Central University v. Ignacio Gallente, G.R. No.
188267, December 2, 2013.

Stare decisis; doctrine of. Under the doctrine of stare decisis, when a court has laid down a principle of law as applicable to
a certain state of facts, it will adhere to that principle and apply it to all future cases in which the facts are substantially
the same, even though the parties may be different. Where the facts are essentially different, however, stare decisis does
!%

not apply because a perfectly sound principle as applied to one set of facts might be entirely inappropriate when a factual
variant is introduced.
This case and the Philippine Carpet Employees Association (PHILCEA) v. Hon. Sto. Tomas case (Philcea case; G.R. No.
168719, February 22, 2006), involve the same period which is March to April 2004; the issuance of the Memorandum
to employees informing them of the implementation of the cost reduction program; the implementation of the voluntary
retirement program and retrenchment program, except that this case involves different employees; the execution of deeds
of release, waiver, and quitclaim, and the acceptance of separation pay by the affected employees. As the respondents
here were similarly situated as the union members in the Philcea case, and considering that the questioned dismissal from
the service was based on the same grounds under the same circumstances, there is no need to re-litigate the issues
presented herein. In short, stare decisis applies and the Court deems it wise to adopt its earlier findings in the Philcea case
that there was no valid ground to terminate the services of the employees. Philippine Carpet Manufacturing Corporation, et
al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Substantial evidence; definition of. The assertions of respondent do not constitute as substantial evidence that a
reasonable mind might accept as adequate to support the conclusion that there is a causal relationship between his illness
and the working conditions on board the petitioners vessel. Although the Court has recognized as sufficient that work
conditions are proven to have contributed even to a small degree, such must, however, be reasonable, and anchored on
credible information. The claimant must, therefore, prove a convincing proposition other than by his mere allegations.
Jebsens Maritime, Inc., et al. v. Eleno A. Baol, G.R. No. 204076, December 4, 2013.

Termination of employment; authorized causes; retrenchment. The illegality of the basis of the implementation of both
voluntary retirement and retrenchment programs of petitioners had been thoroughly ruled upon by the Court in Philippine
Carpet Employees Association (PHILCEA) v. Hon. Sto. Tomas (G.R. No. 168719, February 22, 2006). It discussed the
requisites of both retrenchment and redundancy as authorized causes of termination and concluded that petitioners failed
to substantiate them. In ascertaining the bases of the termination of employees, it took into consideration petitioners claim
of business losses; the purchase of machinery and equipment after the termination, the declaration of cash dividends to
stockholders, the hiring of 100 new employees after the retrenchment, and the authorization of full blast overtime work for
six hours daily. These, said the Court, are inconsistent with petitioners claim that there was a slump in the demand for its
products which compelled them to implement the termination programs. In arriving at its conclusions, the Court took note of
petitioners net sales, gross and net profits, as well as net income. The Court, thus, reached the conclusion that the
retrenchment effected by the company is invalid due to a substantive defect. Philippine Carpet Manufacturing Corporation,
et al. v. Ignacio B. Tagyamon, et al., G.R. No. 191475, December 11, 2013.

Termination of employment; ground; closure of business due to serious business losses; notice requirement. Article 297 of
the Labor Code provides that before any employee is terminated due to closure of business, it must give one (1) months
prior written notice to the employee and to the Department of Labor and Employment. In this relation, case law instructs
!&

that it is the personal right of the employee to be personally informed of his proposed dismissal as well as the reasons
therefor; and such requirement of notice is not a mere technicality or formality which the employer may dispense with.
Since the purpose of previous notice is to, among others, give the employee some time to prepare for the eventual loss of
his job, the employer has the positive duty to inform each and every employee of their impending termination of employment.
To this end, jurisprudence states that an employers act of posting notices to this effect in conspicuous areas in the
workplace is not enough. Verily, for something as significant as the involuntary loss of ones employment, nothing less than
an individually-addressed notice of dismissal supplied to each worker is proper. The Court held that the Labor Arbiter,
NLRC, and Court of Appeals erred in ruling that SPI complied with the notice requirement when it merely posted various
copies of its notice of closure in conspicuous places within the business premises. SPI is required to serve individual written
notices of termination to its employees. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo
Philippines, Inc. Employees Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-
OLALIA, rep. by Porferia Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No.
173154./G.R. No. 173229, December 9, 2013

Termination of employment; authorized cause; closure of business due to serious business losses; separation pay. Closure
of business is the reversal of fortune of the employer whereby there is a complete cessation of business operations and/or
an actual locking-up of the doors of establishment, usually due to financial losses. Closure of business, as an authorized
cause for termination of employment, aims to prevent further financial drain upon an employer who cannot pay anymore his
employees since business has already stopped. In such a case, the employer is generally required to give separation benefits
to its employees, unless the closure is due to serious business losses. As explained in the case of Galaxie Steel Workers
Union (GSWU-NAFLU-KMU) v. NLRC (G.R. No. 165757, October 17, 2006): The Constitution, while affording full
protection to labor, nonetheless, recognizes the right of enterprises to reasonable returns on investments, and to
expansion and growth. In line with this protection afforded to business by the fundamental law, Article [297] of the Labor
Code clearly makes a policy distinction. It is only in instances of retrenchment to prevent losses and in cases of closures
or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses that
employees whose employment has been terminated as a result are entitled to separation pay. In other words, Article [297]
of the Labor Code does not obligate an employer to pay separation benefits when the closure is due to serious losses. To
require an employer to be generous when it is no longer in a position to do so, in our view, would be unduly oppressive,
unjust, and unfair to the employer. Ours is a system of laws, and the law in protecting the rights of the working man,
authorizes neither the oppression nor the self-destruction of the employer.
In this case, the Labor Arbiter, NLRC, and the Court of Appeals all consistently found that petitioners indeed suffered
from serious business losses which resulted in its permanent shutdown and accordingly, held the companys closure to be
valid. It is a rule that absent any showing that the findings of fact of the labor tribunals and the appellate court are not
supported by evidence on record or the judgment is based on a misapprehension of facts, the Court shall not examine anew
the evidence submitted by the parties. Perforce, without any cogent reason to deviate from the findings on the validity of
respondents closure, the Court held that it is not obliged to give separation benefits to minority employees pursuant to
!'

Article 297 of the Labor Code. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo Philippines,
Inc. Employees Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-OLALIA, rep. by
Porferia Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No. 173154./G.R. No.
173229, December 9, 2013.

Termination of employment due to closure; procedural infirmity; nominal damages as sanction. It is well to stress that while
respondent had a valid ground to terminate its employees, i.e., closure of business, its failure to comply with the proper
procedure for termination renders it liable to pay the employee nominal damages for such omission. Based on existing
jurisprudence, an employer which has a valid cause for dismissing its employee but conducts the dismissal with procedural
infirmity is liable to pay the employee nominal damages in the amount of P30,000.00 if the ground for dismissal is a just
cause, or the amount of P50,000.00 if the ground for dismissal is an authorized cause. However, case law exhorts that
in instances where the payment of such damages becomes impossible, unjust, or too burdensome, modification becomes
necessary in order to harmonize the disposition with the prevailing circumstance. In this case, considering that SPI closed
down its operations due to serious business losses and that said closure appears to have been done in good faith, the
Court as in the case of Industrial Timber Corporation v. Ababon (G.R. No. 164518, March 30, 2006), deems it just to
reduce the amount of nominal damages to be awarded to each of the minority employees from P50,000.00 to
Pl0,000.00. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al. v. Sangwoo Philippines, Inc. Employees
Union-OLALIA, rep. by Porferia Salibongcogon/Sangwoo Philippines, Inc. Employees Union-OLALIA, rep. by Porferia
Salibongcogon v. Sangwoo Philippines, Inc. and/or Sang Ik Jang, Jisso Jang, et al., G.R. No. 173154./G.R. No. 173229,
December 9, 2013.

remedial-january 6/4/14 2:33 PM
!

Civil Procedure
Action to annul judgment or final order; jurisdiction. In 1981, the
Legislature enacted Batas Pambansa Blg.129 (Judiciary Reorganization Act of
1980). Among several innovations of this legislative enactment was the formal
establishment of the annulment of a judgment or final order as an action
independent from the generic classification of litigations in which the
subject matter was not capable of pecuniary estimation, and expressly vested
the exclusive original jurisdiction over such action in the CA. The action in
which the subject of the litigation was incapable of pecuniary estimation
continued to be under the exclusive original jurisdiction of the RTC, which
replaced the CFI as the court of general jurisdiction. Since then, the RTC no
longer had jurisdiction over an action to annul the judgment of the RTC,
eliminating all concerns about judicial stability. To implement this change,
the Court introduced a new procedure to govern the action to annul the
judgment of the RTC in the 1997 revision of the Rules of Court under Rule 47,
directing in Section 2 thereof that [t]he annulment may be based only on the
grounds of extrinsic fraud and lack of jurisdiction. Pinausukan Seafood
House-Roxas Blvd., Inc. v. Far East Bank and Trust Cp., now Bank of the
Philippine Islands, et al., G.R. No. 159926, January 20, 2014.

Action to annul judgment or final order; lack of jurisdiction; types. Lack of
jurisdiction on the part of the trial court in rendering the judgment or
final order is either lack of jurisdiction over the subject matter or nature
of the action, or lack of jurisdiction over the person of the petitioner. The
former is a matter of substantive law because statutory law defines the
jurisdiction of the courts over the subject matter or nature of the action.
The latter is a matter of procedural law, for it involves the service of
summons or other process on the petitioner. A judgment or final order issued
by the trial court without jurisdiction over the subject matter or nature of
the action is always void, and, in the words of Justice Street in Banco
Espaol-Filipino v. Palanca (37 Phil 949 [1918]), in this sense 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. But the defect
of lack of jurisdiction over the person, being a matter of procedural law,
may be waived by the party concerned either expressly or impliedly.
Pinausukan Seafood House-Roxas Blvd., Inc. v. Far East Bank and Trust Cp.,
#

now Bank of the Philippine Islands, et al., G.R. No. 159926, January 20,
2014.

Action to annul judgment or final order; nature. The Court has expounded on
the nature of the remedy of annulment of judgment or final order in Dare
Adventure Farm Corporation v. Court of Appeals (681 SCRA 580, 586-587
[2012]), viz:
A petition for annulment of judgment is a remedy in equity so exceptional in
nature that it may be availed of only when other remedies are wanting, and
only if the judgment, final order or final resolution sought to be annulled
was rendered by a court lacking jurisdiction or through extrinsic fraud. Yet,
the remedy, being exceptional in character, is not allowed to be so easily
and readily abused by parties aggrieved by the final judgments, orders or
resolutions. The Court has thus instituted safeguards by limiting the grounds
for the annulment to lack of jurisdiction and extrinsic fraud, and by
prescribing in Section 1 of Rule 47 of the Rules of Court that the petitioner
should show that the ordinary remedies of new trial, appeal, petition for
relief or other appropriate remedies are no longer available through no fault
of the petitioner. A petition for annulment that ignores or disregards any of
the safeguards cannot prosper. x x x
The objective of the remedy of annulment of judgment or final order is to
undo or set aside the judgment or final order, and thereby grant to the
petitioner an opportunity to prosecute his cause or to ventilate his defense.
If the ground relied upon is lack of jurisdiction, the entire proceedings are
set aside without prejudice to the original action being refiled in the
proper court. If the judgment or final order or resolution is set aside on
the ground of extrinsic fraud, the CA may on motion order the trial court to
try the case as if a timely motion for new trial had been granted therein.
The remedy is by no means an appeal whereby the correctness of the assailed
judgment or final order is in issue; hence, the CA is not called upon to
address each error allegedly committed by the trial court. Pinausukan Seafood
House-Roxas Blvd., Inc. v. Far East Bank and Trust Cp., now Bank of the
Philippine Islands, et al., G.R. No. 159926, January 20, 2014.

Action to annul judgment or final order; prescriptive period. The third
requirement sets the time for the filing of the action. The action, if based
$

on extrinsic fraud, must be filed within four years from the discovery of the
extrinsic fraud; and if based on lack of jurisdiction, must be brought before
it is barred by laches or estoppel. Pinausukan Seafood House-Roxas Blvd.,
Inc. v. Far East Bank and Trust Cp., now Bank of the Philippine Islands, et
al., G.R. No. 159926, January 20, 2014.

Action to annul judgment or final order; requisites. The first requirement
prescribes that the remedy is available only when the petitioner can no
longer resort to the ordinary remedies of new trial, appeal, petition for
relief or other appropriate remedies through no fault of the petitioner. This
means that the remedy, although seen as a last remedy, is not an
alternative to the ordinary remedies of new trial, appeal and petition for
relief. The petition must aver, therefore, that the petitioner failed to move
for a new trial, or to appeal, or to file a petition for relief without fault
on his part. But this requirement to aver is not imposed when the ground for
the petition is lack of jurisdiction (whether alleged singly or in
combination with extrinsic fraud), simply because the judgment or final
order, being void, may be assailed at any time either collaterally or by
direct action or by resisting such judgment or final order in any action or
proceeding whenever it is invoked, unless the ground of lack of jurisdiction
is meanwhile barred by laches.
The second requirement limits the ground for the action of annulment of
judgment to either extrinsic fraud or lack of jurisdiction.
Not every kind of fraud justifies the action of annulment of judgment. Only
extrinsic fraud does. Fraud is extrinsic, according to Cosmic Lumber
Corporation v. Court of Appeals (265 SCRA 168, 180 [1996]), where the
unsuccessful party has been prevented from exhibiting fully his case, by
fraud or deception practiced on him by his opponent, as by keeping him away
from court, a false promise of a compromise; or where the defendant never had
knowledge of the suit, being kept in ignorance by the acts of the plaintiff;
or where an attorney fraudulently or without authority connives at his
defeat; these and similar cases which show that there has never been a real
contest in the trial or hearing of the case are reasons for which a new suit
may be sustained to set aside and annul the former judgment and open the case
for a new and fair hearing.
%

The third requirement sets the time for the filing of the action. The action,
if based on extrinsic fraud, must be filed within four years from the
discovery of the extrinsic fraud; and if based on lack of jurisdiction, must
be brought before it is barred by laches or estoppel.
The fourth requirement demands that the petition should be verified, and
should allege with particularity the facts and the law relied upon for
annulment, as well as those supporting the petitioners good and substantial
cause of action or defense, as the case may be. The need for particularity
cannot be dispensed with because averring the circumstances constituting
either fraud or mistake with particularity is a universal requirement in the
rules of pleading. The petition is to be filed in seven clearly legible
copies, together with sufficient copies corresponding to the number of
respondents, and shall contain essential submissions, specifically: (a) the
certified true copy of the judgment or final order or resolution, to be
attached to the original copy of the petition intended for the court and
indicated as such by the petitioner;
(b) the affidavits of witnesses or documents supporting the cause of action
or defense; and (c) the sworn certification that the petitioner has not
theretofore commenced any other action involving the same issues in the
Supreme Court, the CA or the different divisions thereof, or any other
tribunal or agency; if there is such other action or proceeding, he must
state the status of the same, and if he should thereafter learn that a
similar action or proceeding has been filed or is pending before the Supreme
Court, the CA, or different divisions thereof, or any other tribunal or
agency, he undertakes to promptly inform the said courts and other tribunal
or agency thereof within five days therefrom. Pinausukan Seafood House-Roxas
Blvd., Inc. v. Far East Bank and Trust Cp., now Bank of the Philippine
Islands, et al., G.R. No. 159926, January 20, 2014.

Appeal; trial courts factual findings as affirmed by CA are binding on
appeal. To start with, considering that the Court of Appeals (CA) thereby
affirmed the factual findings of the RTC, the Court is bound to uphold such
findings, for it is axiomatic that the trial courts factual findings as
affirmed by the CA are binding on appeal due to the Court not being a trier
of facts. Development Bank of the Philippines (DBP) v. Guaria Agricultural
and Realty Development Corporation,G.R. No. 160758. January 15, 2014.
&


Appeal by certiorari under Rule 45; covers questions of law only; exceptions.
The Court has consistently held that as a general rule, a petition for review
under Rule 45 of the Rules of Court covers questions of law only. The rule,
however, admits of exceptions, subject to the following exceptions, to wit:
(1) when the findings are grounded entirely on speculations, surmises, or
conjectures; (2) when the inference made is manifestly mistaken, absurd, or
impossible; (3) when there is a grave abuse of discretion; (4) when
the judgment is based on misappreciation of facts; (5) when the findings of
fact are conflicting; (6) when in making its findings, the same are contrary
to the admissions of both appellant and appellee; (7) when the findings are
contrary to those of the trial court; (8) when the findings are conclusions
without citation of specific evidence on which they are based; (9) when the
facts set forth in the petition as well as in the petitioners main and
reply briefs are not disputed by the respondent; and (10) when the findings
of fact are premised on the supposed absence of evidence and contradicted by
the evidence on record. Rodolfo Laborte, et al. v. Pagsanjan Tourism
Consumers Cooperative, et al.,G.R. No. 183860, January 15, 2014

Appeal by certiorari under Rule 45; effect of failure to file motion for
reconsideration within 15-day reglementary period. The Court emphasized that
the 15-day period for filing a motion for new trial or reconsideration is
non-extendible. Hence, the filing of a motion for extension of time to file a
motion for reconsideration did not toll the 15-day period before a judgment
becomes final and executory. Rivelisa Realty, Inc., represented by Ricardo P.
Venturina v. First Sta. Clara Builders Corporation, represented by Ramon A.
Pangilinan, as President,G.R. No. 189618. January 15, 2014.

Appeal by certiorari under Rule 45; factual questions may not be raised. Well
entrenched in this jurisdiction is the rule that factual questions may not be
raised before this Court in a petition for review on certiorari as this Court
is not a trier of facts.
Thus, it is settled that in petitions for review on certiorari, only
questions of law may be put in issue. Questions of fact cannot be
entertained.
'

A question of law exists when the doubt or controversy concerns the correct
application of law or jurisprudence to a certain set of facts, or when the
issue does not call for an examination of the probative value of the evidence
presented, the truth or falsehood of facts being admitted. A question of fact
exists when the doubt or difference arises as to the truth or falsehood of
facts or when the query invites calibration of the whole evidence considering
mainly the credibility of the witnesses, the existence and relevancy of
specific surrounding circumstances as well as their relation to each other
and to the whole, and the probability of the situation.Eastern Shipping
Lines, Inc. v. BPI/MS Insurance Corp., and Mitsui Sumitomo Insurance Co.,
Ltd.,G.R. No. 193986, January 15, 2014.

Appeal by certiorari under Rule 45; factual findings of trial court, when
affirmed by CA, are binding on Supreme Court. Considering that the factual
findings of the trial court, when affirmed by the CA, are binding on the
Court, the Court affirms the judgment of the CA upholding Eduardos exercise
of the right of repurchase. Roberto could no longer assail the factual
findings because his petition for review on certiorari was limited to the
review and determination of questions of law only. A question of law exists
when the doubt centers on what the law is on a certain set of undisputed
facts, while a question of fact exists when the doubt centers on the truth or
falsity of the alleged facts. Whether the conditions for the right to
repurchase were complied with, or whether there was a tender of payment is a
question of fact.Roberto R. David, represented by his Attorney-in-Fact Atty.
Proceso M. Nacino v. Eduardo C. David, acting through his Attorney-in-Fact
Edwin C. David,G.R. No. 162365. January 15, 2014.

Appeal by certiorari under Rule 45; scope of review limited. Anent the
correct amount of surety bond, it is well to emphasize that our task in an
appeal by petition for review on certiorari is limited, as a jurisdictional
matter, to reviewing errors of law that might have been committed by the CA.
The allegations of incorrect computation of the surety bond involve factual
matters within the competence of the trial court. LZK Holdings and
Development Corporation v. Planters Development Bank,G.R. No. 187973,
January 20, 2014.
(

Appeal by certiorari under Rule 45; scope of review. At the outset, it must
be pointed out that the petitioners assignment of errors calls for the Court
to again evaluate the evidence to determine whether there was a partition of
the property and whether the 1/3 portion of the southern half was sold to the
respondent spouses. These clearly entail questions of fact which are beyond
the Courts ambit of review under Rule. Theresita, Juan, Asuncion,
Patrocinia, Ricardo, and Gloria, all surnamed Dimaguila v. Jose and Sonia A.
Monteiro,G.R. No. 201011, January 27, 2014.

Ejectment; immediate execution of judgment; requisites for stay. The ruling
in Chua v. Court of Appeals (286 SCRA 437, 444-445 [1998]) is instructive on
the means of staying the immediate execution of a judgment in an ejectment
case, to wit:
As a general rule, a judgment in favor of the plaintiff in an ejectment suit
is immediately executory, in order to prevent further damage to him arising
from the loss of possession of the property in question. To stay the
immediate execution of the said judgment while the appeal is pending the
foregoing provision requires that the following requisites must concur: (1)
the defendant perfects his appeal; (2) he files a supersedeas bond; and (3)
he periodically deposits the rentals which become due during the pendency of
the appeal. The failure of the defendant to comply with any of these
conditions is a ground for the outright execution of the judgment, the duty
of the court in this respect being ministerial and imperative. Hence, if
the defendant-appellant perfected the appeal but failed to file a supersedeas
bond, the immediate execution of the judgment would automatically follow.
Conversely, the filing of a supersedeas bond will not stay the execution of
the judgment if the appeal is not perfected. Necessarily then, the
supersedeas bond should be filed within the period for the perfection of the
appeal.
In short, a judgment in favor of the plaintiff in an ejectment suit is
immediately executory, but the defendant, to stay its immediate execution,
must: (1) perfect an appeal; (2) file a supersedeas bond; and (3)
periodically deposit the rentals becoming due during the pendency of the
appeal. Herminia Acbang v. Hon. Jimmy Luczon, Jr., et al.,G.R. No. 164246,
January 15, 2014.

)

Execution; Terceria; when proper. The right of a third-party claimant to file
a terceria is founded on his title or right of possession. Corollary thereto,
before the court can exercise its supervisory power to direct the release of
the property mistakenly levied and the restoration thereof to its rightful
owner, the claimant must first unmistakably establish his ownership or right
of possession thereon. In Spouses Sy v. Hon. Discaya (260 Phil. 401 [1990])
we declared that for a third-party claim or a terceria to prosper, the
claimant must first sufficiently establish his right on the property:
[A] third person whose property was seized by a sheriff to answer for the
obligation of the judgment debtor may invoke the supervisory power of he
court which authorized such execution. Upon due application by the third
person and after summary hearing, the court may command that the property be
released from the mistaken levy and restored to the rightful owner or
possessor. What said court can do in these instances, however, is limited to
a determination of whether the sheriff has acted rightly or wrongly in the
performance of his duties in the execution of judgment, more specifically, if
he has indeed taken hold of property not belonging to the judgment debtor.
The court does not and cannot pass upon the question of title to the
property, with any character of finality. It can treat of the matter only
insofar as may be necessary to decide if the sheriff has acted correctly or
not. It can require the sheriff to restore the property to the claimants
possession if warranted by the evidence. However, if the claimants proofs do
not persuade the court of the validity of his title or right of possession
thereto, the claim will be denied.
Magdalena T. Villasi v. Filomena Garcia, substituted by his heirs, namely,
Ermelinda H. Garcia, et al.,G.R. No. 190106, January 15, 2014.

Execution of judgments; Immediate execution in Small Claims cases. Section 23
of the Rule of Procedure for Small Claims Cases states that the decision
shall immediately be entered by the Clerk of Court in the court docket for
civil cases and a copy thereof forthwith served on the parties. A.L. Ang
Network, Inc. v. Emma Mondejar, accompanied by her husband, Efren
Mondejar,G.R. No. 200804. January 22, 2014.

Execution of judgments; rationale. It is almost trite to say that execution
is the fruit and end of the suit. Hailing it as the life of the law, ratio
*

legis est anima, this Court has zealously guarded against any attempt to
thwart the rigid rule and deny the prevailing litigant his right to savour
the fruit of his victory. A judgment, if left unexecuted, would be nothing
but an empty triumph for the prevailing party. Magdalena T. Villasi v.
Filomena Garcia, substituted by his heirs, namely, Ermelinda H. Garcia, et
al.,G.R. No. 190106, January 15, 2014.

Grave abuse of discretion; concept. To be sure, grave abuse of discretion
arises when a lower court or tribunal patently violates the Constitution, the
law or existing jurisprudence. Here, while the RTC had initially issued a
writ of possession in favor of Sps. Marquez, it defied existing jurisprudence
when it effectively rescinded the said writ by subsequently granting Sps.
Alindogs prayer for injunctive relief. Spouses Nicasio C. Marquez and Anita
J. Marquez v. Spouses Carlito Alindog and Carmen Alindog,G.R. No. 184045.
January 22, 2014.

Grave abuse of discretion; concept. It is settled doctrine that there is
grave abuse of discretion when there is a capricious and whimsical exercise
of judgment as is equivalent to lack of jurisdiction, such as where the power
is exercised in an arbitrary or despotic manner by reason of passion or
personal hostility, and it must be so patent and gross so as to amount to an
evasion of positive duty or to a virtual refusal to perform the duty enjoined
or to act at all in contemplation of law. Ralph P. Tua v. Hon. Cesar A.
Mangrobang, Presiding Judge, Branch 22, RTC, Imus, Cavite; and Rossan
Honrado-Tua,G.R. No. 170701. January 22, 2014.

Judicial power; issuance of protection orders. Section 2 of Article VIII of
the 1987 Constitution provides that the Congress shall have the power to
define, prescribe, and apportion the jurisdiction of the various courts but
may not deprive the Supreme Court of its jurisdiction over cases enumerated
in Section 5 hereof. Hence, the primary judge of the necessity, adequacy,
wisdom, reasonableness and expediency of any law is primarily the function of
the legislature. The act of Congress entrusting us with the issuance of
protection orders is in pursuance of our authority to settle justiciable
controversies or disputes involving rights that are enforceable and
demandable before the courts of justice or the redress of wrongs for
!+

violations of such rights. Ralph P. Tua v. Hon. Cesar A. Mangrobang,
Presiding Judge, Branch 22, RTC, Imus, Cavite; and Rossan Honrado-Tua, G.R.
No. 170701. January 22, 2014.

Judgments; enforceability of money judgments. It is a basic principle of law
that money judgments are enforceable only against the property
incontrovertibly belonging to the judgment debtor, and if the property
belonging to any third person is mistakenly levied upon to answer for another
mans indebtedness, such person has all the right to challenge the levy
through any of the remedies provided for under the Rules of Court. Magdalena
T. Villasi v. Filomena Garcia, substituted by his heirs, namely, Ermelinda H.
Garcia, et al.,G.R. No. 190106, January 15, 2014.

Judgments; Law of the case; concept. Law of the case has been defined as the
opinion delivered on a former appeal, and means, more specifically, that
whatever is once irrevocably established as the controlling legal rule of
decision between the same parties in the same case continues to be the law of
the case, whether correct on general principles or not, so long as the facts
on which such decision was predicated continue to be the facts of the case
before the court.
The doctrine of law of the case simply means, therefore, that when an
appellate court has once declared the law in a case, its declaration
continues to be the law of that case even on a subsequent appeal,
notwithstanding that the rule thus laid down may have been reversed in other
cases. For practical considerations, indeed, once the appellate court has
issued a pronouncement on a point that was presented to it with full
opportunity to be heard having been accorded to the parties, the
pronouncement should be regarded as the law of the case and should not be
reopened on remand of the case to determine other issues of the case, like
damages. But the law of the case, as the name implies, concerns only legal
questions or issues thereby adjudicated in the former appeal. Development
Bank of the Philippines (DBP) v. Guaria Agricultural and Realty Development
Corporation,G.R. No. 160758. January 15, 2014.

Judgments; remedies of third person claiming property taken by sheriff.
Section 16, Rule 39 specifically provides that a third person may avail
!!

himself of the remedies of either terceria, to determine whether the sheriff
has rightly or wrongly taken hold of the property not belonging to
the judgment debtor or obligor, or an independent separate action to
vindicate his claim of ownership and/or possession over the foreclosed
property. However, the person other than the judgment debtor who claims
ownership or right over levied properties is not precluded from taking other
legal remedies to prosecute his claim. Magdalena T. Villasi v. Filomena
Garcia, substituted by his heirs, namely, Ermelinda H. Garcia, et al.,G.R.
No. 190106, January 15, 2014.

Jurisdiction; concurrence of jurisdiction and hierarchy of courts. To be
sure, the Court, the Court of Appeals and the Regional Trial Courts have
concurrent jurisdiction to issue a writ of certiorari. Such concurrence of
jurisdiction, however, does not give a party unbridled freedom to choose the
venue of his action lest he run afoul of the doctrine of hierarchy of courts.
Instead, a becoming regard for judicial hierarchy dictates that petitions for
the issuance of writs of certiorari against first level courts should be
filed with the Regional Trial Court, and those against the latter, with the
Court of Appeals, before resort may be had before the Supreme Court. A.L. Ang
Network, Inc. v. Emma Mondejar, accompanied by her husband, Efren
Mondejar,G.R. No. 200804. January 22, 2014.

Jurisdiction; Justiciable question; definition. The Court clarified, too,
that the issue of whether a Deputy Ombudsman may be subjected to the
administrative disciplinary jurisdiction of the President (concurrently with
that of the Ombudsman) is a justiciable not a political question. A
justiciable question is one which is inherently susceptible of being decided
on grounds recognized by law, as where the court finds that there are
constitutionally-imposed limits on the exercise of the powers conferred on a
political branch of the government. Emilio A. Gonzales III v. Office of the
President, etc., et al./Wendell Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr.,
et al.,G.R. No. 196231/G.R. No. 196232, January 28, 2014.

Jurisdiction; Small Claims cases. Hence, considering that small claims cases
are exclusively within the jurisdiction of the Metropolitan Trial Courts,
Municipal Trial Courts in Cities, Municipal Trial Courts, and Municipal
!#

Circuit Trial Courts, certiorari petitions assailing its dispositions should
be filed before their corresponding Regional Trial Courts. This petitioner
complied with when it instituted its petition for certiorari before the RTC
which, as previously mentioned, has jurisdiction over the same. A.L. Ang
Network, Inc. v. Emma Mondejar, accompanied by her husband, Efren
Mondejar,G.R. No. 200804. January 22, 2014.

Motions; motion to extend time to file motion for reconsideration prohibited
in all courts except in the Supreme Court. While a motion for additional time
is expressly permitted in the filing of a petition for review before the
Court under Section 2, Rule 45 of the Rules of Court, a similar motion
seeking to extend the period for filing a motion for reconsideration is
prohibited in all other courts. This rule was first laid down in the case of
Habaluyas Enterprises v. Japzon (226 Phil. 144 [1986]) wherein it was held
that:
Beginning one month after the promulgation of this Resolution, the rule
shall be strictly enforced that no motion for extension of time to file a
motion for new trial or reconsideration may be filed with the Metropolitan or
Municipal Trial Courts, the Regional Trial Courts, and the Intermediate
Appellate Court. Such a motion may be filed only in cases pending with the
Supreme Court as the court of last resort, which may in its sound discretion
either grant or deny the extension requested.
Rivelisa Realty, Inc., represented by Ricardo P. Venturina v. First Sta.
Clara Builders Corporation, represented by Ramon A. Pangilinan, as
President,G.R. No. 189618. January 15, 2014.

Motion for reconsideration; effect of non-filing. At the outset, the Court
noted that Gonzales and Sulit did not file a motion for reconsideration of
the Supreme Courts September 4, 2012 Decision; only the Office of the
President, through the OSG, moved for the reconsideration of our ruling
reinstating Gonzales.
This omission, however, poses no obstacle for the Courts review of its
ruling on the whole case since a serious constitutional question has been
raised and is one of the underlying bases for the validity or invalidity of
the presidential action.
!$

If the President does not have any constitutional authority to discipline a
Deputy Ombudsman and/or a Special Prosecutor in the first place, then any
ruling on the legal correctness of the OPs decision on the merits will be an
empty one. In other words, since the validity of the OPs decision on the
merits of the dismissal is inextricably anchored on the final and correct
ruling on the constitutional issue, the whole case including the
constitutional issue remains alive for the Courts consideration on motion
for reconsideration. Emilio A. Gonzales III v. Office of the President, etc.,
et al./Wendell Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et al.,G.R. No.
196231/G.R. No. 196232, January 28, 2014.

Pleadings; Defense and objections not pleaded either in motion to dismiss or
in answer are deemed waived; exceptions. Significantly, the Rule requires
that such a motion should be filed within the time for but before filing the
answer to the complaint or pleading asserting a claim. The time frame
indicates that thereafter, the motion to dismiss based on the absence of the
condition precedent is barred. It is so inferable from the opening sentence
of Section 1 of Rule 9 stating that defense and objections not pleaded either
in a motion to dismiss or in the answer are deemed waived. There are, as just
noted, only four exceptions to this Rule, namely, lack of jurisdiction over
the subject matter; litis pendentia; res judicata; and prescription of
action. Failure to allege in the complaint that earnest efforts at a
compromise has been made but had failed is not one of the exceptions.Heirs of
Dr. Mariano Favis, Sr., represented by their co-heirs and attorneys-in-fact,
Mercedes A. Favis and Nelly Favis-Villafuente v. Juana Gonzales, her son
Mariano Favis, all minors represented herein by their parents, Sps. Mariano
Favis and Larcelita D. Favis,G.R. No. 185922, January 15, 2014.

Pleadings; Failure to allege compromise efforts in complaint not
jurisdictional defect. Why the objection of failure to allege a failed
attempt at a compromise in a suit among members of the same family is
waivable was earlier explained in the case of Versoza v. Versoza (135 Phil.
84, 94 [1968]), a case for future support which was dismissed by the trial
court upon the ground that there was no such allegation of infringement of
Article 222 of the Civil Code, the origin of Article 151 of the Family Code.
While the Court ruled that a complaint for future support cannot be the
!%

subject of a compromise and as such the absence of the required allegation in
the complaint cannot be a ground for objection against the suit, the decision
went on to state thus:
The alleged defect is that the present complaint does not state a cause of
action. The proposed amendment seeks to complete it. An amendment to the
effect that the requirements of Article 222 have been complied with does not
confer jurisdiction upon the lower court. With or without this amendment, the
subject-matter of the action remains as one for support, custody of children,
and damages, cognizable by the court below.
To illustrate, Tamayo v. San Miguel Brewery, Inc., allowed an amendment which
merely corrected a defect in the allegation of plaintiff-appellants cause
of action, because as it then stood, the original complaint stated no cause
of action. We there ruled out as inapplicable the holding in Campos Rueda
Corporation v. Bautista, that an amendment cannot be made so as to confer
jurisdiction on the court x x x
Therefore, the rule on deemed waiver of the non-jurisdictional defense or
objection is wholly applicable to respondent. If the respondents as parties-
defendants could not, and did not, after filing their answer to petitioners
complaint, invoke the objection of absence of the required allegation on
earnest efforts at a compromise, the appellate court unquestionably did not
have any authority or basis to muto proprio order the dismissal of
petitioners complaint. Heirs of Dr. Mariano Favis, Sr., represented by their
co-heirs and attorneys-in-fact, Mercedes A. Favis and Nelly Favis-Villafuente
v. Juana Gonzales, her son Mariano Favis, all minors represented herein by
their parents, Sps. Mariano Favis and Larcelita D. Favis,G.R. No. 185922,
January 15, 2014.

Pleadings; motu proprio dismissal. Section 1, Rule 9 provides for only four
instances when the court may motu proprio dismiss the claim, namely: (a) lack
of jurisdiction over the subject matter; (b) litis pendentia; (c) res
judicata; and (d) prescription of action.
Specifically in Gumabon v. Larin (422 Phil. 222, 230 [2001]), cited in Katon
v. Palanca, Jr. (481 Phil. 168, 180 [2004]), the Court held:
x x x [T]he muto proprio dismissal of a case was traditionally limited to
instances when the court clearly had no jurisdiction over the subject matter
and when the plaintiff did not appear during trial, failed to prosecute his
!&

action for an unreasonable length of time or neglected to comply with the
rules or with any order of the court. Outside of these instances, any motu
proprio [sic] dismissal would amount to a violation of the right of the
plaintiff to be heard. Except for qualifying and expanding Section 2, Rule
9, and Section 3, Rule 17, of the Revised Rules of Court, the amendatory 1997
Rules of Civil Procedure brought about no radical change. Under the new
rules, a court may muto proprio dismiss a claim when it appears from the
pleadings or evidence on record that it has no jurisdiction over the subject
matter; when there is another cause of action pending between the same
parties for the same cause, or where the action is barred by a prior judgment
or by statute of limitations. x x x.
Heirs of Dr. Mariano Favis, Sr., represented by their co-heirs and attorneys-
in-fact, Mercedes A. Favis and Nelly Favis-Villafuente v. Juana Gonzales, her
son Mariano Favis, all minors represented herein by their parents, Sps.
Mariano Favis and Larcelita D. Favis,G.R. No. 185922, January 15, 2014.

Preliminary injunction; improper where act sought to be enjoined is already
consummated. Case law instructs that injunction would not lie where the acts
sought to be enjoined had already become fait accompli (meaning, an
accomplished or consummated act). Hence, since the consummation of the act
sought to be restrained had rendered Sps. Alindogs injunction petition moot,
the issuance of the said injunctive writ was altogether improper. Spouses
Nicasio C. Marquez and Anita J. Marquez v. Spouses Carlito Alindog and Carmen
Alindog,G.R. No. 184045. January 22, 2014.

Res judicata; conclusiveness of judgment. Under the principle of
conclusiveness of judgment, the right of Planters Bank to a writ of
possession as adjudged in G.R. No. 167998 is binding and conclusive on the
parties.
The doctrine of res judicata by conclusiveness of judgment postulates that
when a right or fact has been judicially tried and determined by a court of
competent jurisdiction, or when an opportunity for such trial has been given,
the judgment of the court, as long as it remains unreversed, should be
conclusive upon the parties and those in privity with them.
All the elements of the doctrine are present in this case. The final judgment
in G.R. No. 167998 was rendered by the Court pursuant to its jurisdiction
!'

over the review of decisions and rulings of the CA. It was a judgment on the
merits of Planters Banks right to apply for and be issued a writ of
possession. Lastly, the parties in G.R. No. 167998 are the same parties
involved in the present case. LZK Holdings and Development Corporation v.
Planters Development Bank,G.R. No. 187973, January 20, 2014.

Writ of possession; nature. No hearing is required prior to the issuance of a
writ of possession. This is clear from the following disquisitions in
Espinoza v United Overseas Bank Phils. (616 SCRA 353) which reiterates the
settled rules on writs of possession, to wit:
The proceeding in a petition for a writ of possession is ex parte and summary
in nature. It is a judicial proceeding brought for the benefit of one party
only and without notice by the court to any person adverse of interest. It is
a proceeding wherein relief is granted without giving the person against whom
the relief is sought an opportunity to be heard. By its very nature, an ex
parte petition for issuance of a writ of possession is a non-litigious
proceeding. It is a judicial proceeding for the enforcement of ones right of
possession as purchaser in a foreclosure sale. It is not an ordinary suit
filed in court, by which one party sues another for the enforcement of a
wrong or protection of a right, or the prevention or redress of a wrong. LZK
Holdings and Development Corporation v. Planters Development Bank,G.R. No.
187973, January 20, 2014

Other Proceedings
Barangay Protection Order (BPO); Function of Punong Barangay purely executive
in nature. The issuance of a BPO by the Punong Barangay or, in his
unavailability, by any available Barangay Kagawad, merely orders the
perpetrator to desist from (a) causing physical harm to the woman or her
child; and (2) threatening to cause the woman or her child physical harm.
Such function of the Punong Barangay is, thus, purely executive in nature, in
pursuance of his duty under the Local Government Code to enforce all laws
and ordinances, and to maintain public order in the barangay. Ralph P. Tua
v. Hon. Cesar A. Mangrobang, Presiding Judge, Branch 22, RTC, Imus, Cavite;
and Rossan Honrado-Tua, G.R. No. 170701. January 22, 2014.

!(

Extra-judicial foreclosure; ministerial duty to issue writ of possession to
purchaser; exception. It is an established rule that the purchaser in an
extra-judicial foreclosure sale is entitled to the possession of the property
and can demand that he be placed in possession of the same either during
(with bond) or after the expiration (without bond) of the redemption period
therefor. To this end, the Court, in China Banking Corp. v. Sps. Lozada (579
Phil 454 [2008]), citing several cases on the matter, explained that a writ
of possession duly applied for by said purchaser should issue as a matter of
course, and thus, merely constitutes a ministerial duty on the part of the
court.
The ministerial issuance of a writ of possession in favor of the purchaser in
an extra-judicial foreclosure sale, however, admits of an exception. Section
33, Rule 39 of the Rules of Court (Rules) pertinently provides that the
possession of the mortgaged property may be awarded to a purchaser in an
extra-judicial foreclosure unless a third party is actually holding the
property by adverse title or right. In the recent case of Rural Bank of Sta.
Barbara (Iloilo), Inc. v. Centeno (693 SCRA 110 [2013]), citing the case of
China Banking Corp., the Court illumined that the phrase a third party who
is actually holding the property adversely to the judgment obligor
contemplates a situation in which a third party holds the property by adverse
title or right, such as that of a co-owner, tenant or usufructuary. The co-
owner, agricultural tenant, and usufructuary possess the property in their
own right, and they are not merely the successor or transferee of the right
of possession of another co-owner or the owner of the property. Notably, the
property should not only be possessed by a third party, but also held by the
third party adversely to the judgment obligor. In other words, as mentioned
in Villanueva v. Cherdan Lending Investors Corporation (633 SCRA 173 [2010]),
the third person must therefore claim a right superior to that of the
original mortgagor. Spouses Nicasio C. Marquez and Anita J. Marquez v.
Spouses Carlito Alindog and Carmen Alindog, G.R. No. 184045. January 22,
2014.

Protection Order under Section 15 of RA 9262; concept. In Garcia v. Drilon
(699 SCRA 352, 401 [2013]), wherein petitioner therein argued that Section 15
of RA 9262 is a violation of the due process clause of the Constitution, we
struck down the challenge and held:
!)

A protection order is an order issued to prevent further acts of violence
against women and their children, their family or household members, and to
grant other necessary reliefs. Its purpose is to safeguard the offended
parties from further harm, minimize any disruption in their daily life and
facilitate the opportunity and ability to regain control of their life. The
scope of reliefs in protection orders is broadened to ensure that the victim
or offended party is afforded all the remedies necessary to curtail access by
a perpetrator to the victim. This serves to safeguard the victim from greater
risk of violence; to accord the victim and any designated family or household
member safety in the family residence, and to prevent the perpetrator from
committing acts that jeopardize the employment and support of the victim. It
also enables the court to award temporary custody of minor children to
protect the children from violence, to prevent their abduction by the
perpetrator and to ensure their financial support. The rules require that
petitions for protection order be in writing, signed and verified by the
petitioner thereby undertaking full responsibility, criminal or civil, for
every allegation therein. Since time is of the essence in cases of VAWC if
further violence is to be prevented, the court is authorized to issue ex
parte a TPO after raffle but before notice and hearing when the life, limb or
property of the victim is in jeopardy and there is reasonable ground to
believe that the order is necessary to protect the victim from the immediate
and imminent danger of VAWC or to prevent such violence, which is about to
recur. There need not be any fear that the judge may have no rational basis
to issue an ex parte order. The victim is required not only to verify the
allegations in the petition, but also to attach her witnesses affidavits to
the petition. The grant of a TPO ex parte cannot, therefore, be challenged as
violative of the right to due process. Just like a writ of preliminary
attachment which is issued without notice and hearing because the time in
which the hearing will take could be enough to enable the defendant to
abscond or dispose of his property, in the same way, the victim of VAWC may
already have suffered harrowing experiences in the hands of her tormentor,
and possibly even death, if notice and hearing were required before such
acts could be prevented. It is a constitutional commonplace that the ordinary
requirements of procedural due process must yield to the necessities of
protecting vital public interests, among which is protection of women and
!*

children from violence and threats to their personal safety and security. x x
x
Ralph P. Tua v. Hon. Cesar A. Mangrobang, Presiding Judge, Branch 22, RTC,
Imus, Cavite; and Rossan Honrado-Tua,G.R. No. 170701. January 22, 2014.

Temporary Protection Order (TPO) under Section 15 of RA 9262; courts
authority to issue ex parte. Clearly, the court, under Section 15 of RA 9262,
is authorized to issue a TPO on the date of the filing of the application
after ex parte determination that there is basis for the issuance thereof. Ex
parte means that the respondent need not be notified or be present in the
hearing for the issuance of the TPO. Thus, it is within the courts
discretion, based on the petition and the affidavit attached thereto, to
determine that the violent acts against women and their children for the
issuance of a TPO have been committed. Ralph P. Tua v. Hon. Cesar A.
Mangrobang, Presiding Judge, Branch 22, RTC, Imus, Cavite; and Rossan
Honrado-Tua,G.R. No. 170701. January 22, 2014.

Evidence
Admissions; contradiction. Section 4 of Rule 129 of the Rules of Court
provides that an admission made by a party in the course of the proceedings
in the same case does not require proof, and may be contradicted only by
showing that it was made through palpable mistake. The petitioners argue that
such admission was the palpable mistake of their former counsel in his rush
to file the answer, a copy of which was not provided to them. This contention
is unacceptable. It is a purely self-serving claim unsupported by any iota of
evidence. Bare allegations, unsubstantiated by evidence, are not equivalent
to proof. Theresita, Juan, Asuncion, Patrocinia, Ricardo, and Gloria, all
surnamed Dimaguila v. Jose and Sonia A. Monteiro,G.R. No. 201011, January
27, 2014.

Admissions; rendered conclusive through estoppel. Article 1431 of the Civil
Code provides that through estoppel, an admission is rendered conclusive upon
the person making it, and cannot be denied or disproved as against the person
relying thereon. The respondent spouses had clearly relied on the
petitioners admission and so amended their original complaint for partition
to one for recovery of possession of a portion of the subject property. Thus,
#+

the petitioners are now estopped from denying or attempting to prove that
there was no partition of the property. Theresita, Juan, Asuncion,
Patrocinia, Ricardo, and Gloria, all surnamed Dimaguila v. Jose and Sonia A.
Monteiro,G.R. No. 201011, January 27, 2014.

Best evidence rule; concept and exception. Section 3(d) of Rule 130 of the
Rules of Court provides that when the subject of inquiry is the contents of a
document, no evidence shall be admissible other than the original document
itself, except when the original is a public record in the custody of a
public officer or is recorded in a public office. Section 7 of the same Rule
provides that when the original of a document is in the custody of a public
officer or is recorded in a public office, its contents may be proved by a
certified copy issued by the public officer in custody thereof. Section 24 of
Rule 132 provides that the record of public documents may be evidenced by a
copy attested by the officer having the legal custody or the record.
Certified true copies of the cadastral map of Liliw and the corresponding
list of claimants of the area covered by the map were presented by two public
officers. x x x The cadastral maps and the list of claimants, as certified
true copies of original public records, fall under the exception to the best
evidence rule. Theresita, Juan, Asuncion, Patrocinia, Ricardo, and Gloria,
all surnamed Dimaguila v. Jose and Sonia A. Monteiro, G.R. No. 201011,
January 27, 2014.

Burden of proof in civil cases; quantum of evidence. Land Bank failed to
prove that the amount allegedly miscredited to Oates account came from
the proceeds of the pre-terminated loans of its clients. It is worth
emphasizing that in civil cases, the party making the allegations has the
burden of proving them by preponderance of evidence. Mere allegation is not
sufficient. Land Bank of the Philippines v. Emmanuel C. Oate,G.R. No.
192371, January 15, 2014.

Hearsay rule; entries in official records as exception. As to the hearsay
rule, Section 44 of Rule 130 of the Rules of Court similarly provides that
entries in official records are an exception to the rule. The rule provides
that entries in official records made in the performance of the duty of a
public officer of the Philippines, or by a person in the performance of a
#!

duty specially enjoined by law, are prima facie evidence of the facts therein
stated. The necessity of this rule consists in the inconvenience and
difficulty of requiring the officials attendance as a witness to testify to
the innumerable transactions in the course of his duty. The documents
trustworthiness consists in the presumption of regularity of performance of
official duty.
Cadastral maps are the output of cadastral surveys. The DENR is the
department tasked to execute, supervise and manage the conduct of cadastral
surveys. It is, therefore, clear that the cadastral map and the corresponding
list of claimants qualify as entries in official records as they were
prepared by the DENR, as mandated by law. As such, they are exceptions to the
hearsay rule and are prima facie evidence of the facts stated therein.
Theresita, Juan, Asuncion, Patrocinia, Ricardo, and Gloria, all surnamed
Dimaguila v. Jose and Sonia A. Monteiro,G.R. No. 201011, January 27,
2014.

Judicial notice; discretionary notice of records of other cases. The taking
of judicial notice is a matter of expediency and convenience for it fulfills
the purpose that the evidence is intended to achieve, and in this sense, it
is equivalent to proof. Generally, courts are not authorized to take
judicial notice of the contents of the records of other cases even when said
cases have been tried or are pending in the same court or before the same
judge. They may, however, take judicial notice of a decision or the facts
prevailing in another case sitting in the same court if: (1) the parties
present them in evidence, absent any opposition from the other party; or (2)
the court, in its discretion, resolves to do so. In either case, the courts
must observe the clear boundary provided by Section 3, Rule 129 of the Rules
of Court. Land Bank of the Philippines v. Yatco Agricultural Enterprises,G.R.
No. 172551, January 15, 2014.

Offer of evidence; court considers evidence only when formally offered;
exceptions. Section 34, Rule 132 of the Revised Rules on Evidence provides
the general rule, to wit:
Section 34. The Court shall consider no evidence which has not been formally
offered. The purpose for which the evidence is offered must be specified.
##

From the above provision, it is clear that the court considers the evidence
only when it is formally offered. The offer of evidence is necessary because
it is the duty of the trial court to base its findings of fact and its
judgment only and strictly on the evidence offered by the parties. A piece of
document will remain a scrap of paper without probative value unless and
until admitted by the court in evidence for the purpose or purposes for which
it is offered. The formal offer of evidence allows the parties the chance to
object to the presentation of an evidence which may not be admissible for
the purpose it is being offered.
However, there are instances when the Court relaxed the foregoing rule and
allowed evidence not formally offered to be admitted. Citing People v. Napat-
a and People. v. Mate the Court in Heirs of Romana Saves, et al., v. Heirs of
Escolastico Saves, et al. (632 SCRA 236 [2010]), enumerated the requirements
for the evidence to be considered despite failure to formally offer it,
namely: first, the same must have been duly identified by testimony duly
recorded and, second, the same must have been incorporated in the records of
the case. In People v. Vivencio De Roxas et al. (116 Phil 977 [1962]), the
Court also considered exhibits which were not formally offered by the
prosecution but were repeatedly referred to in the course of the trial by the
counsel of the accused.
In the instant case, the Court finds that the above requisites are attendant
to warrant the relaxation of the rule and admit the evidence of
the petitioners not formally offered. As can be seen in the records of the
case, the petitioners were able to present evidence that have been duly
identified by testimony duly recorded. To identify is to prove the identity
of a person or a thing. Identification means proof of identity; the proving
that a person, subject or article before the court is the very same that he
or it is alleged, charged or reputed to be. Rodolfo Laborte, et al. v.
Pagsanjan Tourism Consumers Cooperative, et al.,G.R. No. 183860, January
15, 2014.

Preponderance of evidence; definition. Spouses Monteiro, as plaintiffs in the
original case, had the burden of proof to establish their case by a
preponderance of evidence, which is the weight, credit, and value of the
aggregate evidence on either side, synonymous with the term greater weight
of the evidence. Preponderance of evidence is evidence which is more
#$

convincing to the court as worthy of belief than that which is offered in
opposition thereto. Theresita, Juan, Asuncion, Patrocinia, Ricardo, and
Gloria, all surnamed Dimaguila v. Jose and Sonia A. Monteiro,G.R. No.
201011, January 27, 2014.

Question of law distinguished from question of fact. A question of law exists
when the doubt or controversy concerns the correct application of law or
jurisprudence to a certain set of facts, or when the issue does not call for
an examination of the probative value of the evidence presented, the truth or
falsehood of facts being admitted. A question of fact exists when the doubt
or difference arises as to the truth or falsehood of facts or when the query
invites calibration of the whole evidence considering mainly the credibility
of the witnesses, the existence and relevancy of specific surrounding
circumstances as well as their relation to each other and to the whole, and
the probability of the situation.Eastern Shipping Lines, Inc. v. BPI/MS
Insurance Corp., and Mitsui Sumitomo Insurance Co., Ltd.,G.R. No. 193986,
January 15, 2014.

Question of law distinguished from question of fact. A question of law
exists when the doubt centers on what the law is on a certain set of
undisputed facts, while a question of fact exists when the doubt centers on
the truth or falsity of the alleged facts. Whether the conditions for the
right to repurchase were complied with, or whether there was a tender of
payment is a question of fact.Roberto R. David, represented by his Attorney-
in-Fact Atty. Proceso M. Nacino v. Eduardo C. David, acting through his
Attorney-in-Fact Edwin C. David,G.R. No. 162365. January 15, 2014.

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Absence of motion of reconsideration; effect of. The omission of the filing of a
motion for reconsideration poses no obstacle for the Courts review of its ruling
on the whole case since a serious constitutional question has been raised and is
one of the underlying bases for the validity or invalidity of the presidential
action. If the President does not have any constitutional authority to discipline a
Deputy Ombudsman and/or a Special Prosecutor in the first place, then any
ruling on the legal correctness of the OPs decision on the merits will be an empty
one. In other words, since the validity of the OPs decision on the merits of the
dismissal is inextricably anchored on the final and correct ruling on the
constitutional issue, the whole case including the constitutional issue remains
alive for the Courts consideration on motion for reconsideration. Emilio A.
Gonzales III v. Office of the President, etc., et al./Wendell Bareras-Sulit v. Atty.
Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No. 196232, January 28,
2014.

Congress; power to determine modes of removal from office of public officers;
must be consistent with the core constitutional principle of independence of the
Office of the Ombudsman. The intent of the framers of the Constitution in
providing that all other public officers and employees may be removed from
office as provided by law, but not by impeachment in the second sentence of
Section 2, Article XI is to prevent Congress from extending the more stringent
rule of removal only by impeachment to favoured public officers. Contrary to
the implied view of the minority, in no way can this provision be regarded as
blanket authority for Congress to provide for any ground of removal it deems fit.
While the manner and cause of removal are left to congressional determination,
this must still be consistent with constitutional guarantees and principles,
namely: the right to procedural and substantive due process; the constitutional
guarantee of security of tenure; the principle of separation of powers; and the
principle of checks and balances. The authority granted by the Constitution to
Congress to provide for the manner and cause of removal of all other public
officers and employees does not mean that Congress can ignore the basic
principles and precepts established by the Constitution. Emilio A. Gonzales III
v. Office of the President, etc., et al./Wendell Bareras-Sulit v. Atty. Paquito N.
Ochoa, Jr., et al., G.R. No. 196231/G.R. No. 196232, January 28, 2014.

#

Constitutional bodies; concept of independence. The independence enjoyed by the
Office of the Ombudsman and by the Constitutional Commissions shares certain
characteristics they do not owe their existence to any act of Congress, but are
created by the Constitution itself; additionally, they all enjoy fiscal autonomy. In
general terms, the framers of the Constitution intended that these independent
bodies be insulated from political pressure to the extent that the absence of
independence would result in the impairment of their core functions. The
deliberative considerations abundantly show that the independent constitutional
commissions have been consistently intended by the framers to be independent
from executive control or supervision or any form of political influence. At least
insofar as these bodies are concerned, jurisprudence is not scarce on how the
independence granted to these bodies prevents presidential interference.
Emilio A. Gonzales III v. Office of the President, etc., et al./Wendell Bareras-Sulit
v. Atty. Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No. 196232, January
28, 2014.

Gross negligence; concept of; not present when Deputy Ombudsman reviews a
case for nine days. Gross negligence refers to negligence characterized by the
want of even the slightest care, acting or omitting to act in a situation where
there is a duty to act, not inadvertently but wilfully and intentionally, with a
conscious indifference to consequences insofar as other persons may be affected.
In case of public officials, there is gross negligence when a breach of duty is
flagrant and palpable. The Deputy Ombudsman cannot be guilty of gross neglect
of duty and/or inefficiency since he acted on the case forwarded to him within
nine days. The OPs ruling that Gonzales had been grossly negligent for taking
nine days, instead of five days as required for Hearing Officers, is totally
baseless.Emilio A. Gonzales III v. Office of the President, etc., et al./Wendell
Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No.
196232, January 28, 2014.

Impeachment; concept of. Impeachment is the most difficult and cumbersome
mode of removing a public officer from office. It is, by nature, a sui generis
politico-legal process that signals the need for a judicious and careful handling as
shown by the process required to initiate the proceeding; the one-year limitation
or bar for its initiation; the limited grounds for impeachment; the defined
instrumentality given the power to try impeachment cases; and the number of
$

votes required for a finding of guilt. Emilio A. Gonzales III v. Office of the
President, etc., et al./Wendell Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et al.,
G.R. No. 196231/G.R. No. 196232, January 28, 2014.

Judicial power; issuance of protection orders is in pursuance of the Courts
authority to settle justiciable controversies or disputes involving rights that are
enforceable and demandable before the courts of justice or the redress of wrongs
for violations of such rights. The provision in R.A. 9262 allowing the issuance of
protection orders is not an invalid delegation of legislative power to the court and
to barangay officials to issue protection orders. Section 2 of Article VIII of the
1987 Constitution provides that the Congress shall have the power to define,
prescribe, and apportion the jurisdiction of the various courts but may not
deprive the Supreme Court of its jurisdiction over cases enumerated in Section 5
hereof. Hence, the primary judge of the necessity, adequacy, wisdom,
reasonableness and expediency of any law is primarily the function of the
legislature. The act of Congress entrusting us with the issuance of protection
orders is in pursuance of our authority to settle justiciable controversies or
disputes involving rights that are enforceable and demandable before the courts
of justice or the redress of wrongs for violations of such rights. Ralph P. Tua v.
Hon. Cesar A. Mangrobang, Presiding Judge, Branch 22, RTC, Imus, Cavite; and
Rossan Honrado-Tua, G.R. No. 170701. January 22, 2014.

Just compensation; determination of just compensation is fundamentally a
judicial function. In the exercise of the Courts essentially judicial function of
determining just compensation, the RTC-SACs are not granted unlimited
discretion and must consider and apply the enumerated factors in R.A. No. 6657
and the DAR formula (in AO 5-98) that reflect these factors. These factors and
formula provide the uniform framework or structure for the computation of the
just compensation for a property subject to agrarian reform. When acting within
the parameters set by the law itself, the RTC-SACs, however, are not strictly
bound to apply the DAR formula to its minute detail, particularly when faced
with situations that do not warrant the formulas strict application; they may, in
the exercise of their discretion, relax the formulas application to fit the factual
situations before them. They must, however, clearly explain the reason for any
deviation from the factors and formula that the law and the rules have
%

provided.Land Bank of the Philippines v. Yatco Agricultural Enterprises, G.R. No.
172551, January 15, 2014.

Just compensation; fair market value of the expropriated property is determined
as of the time of taking. The time of taking refers to that time when the State
deprived the landowner of the use and benefit of his property, as when the State
acquires title to the property or as of the filing of the complaint, per Section 4,
Rule 67 of the Rules of Court. Land Bank of the Philippines v. Yatco Agricultural
Enterprises, G.R. No. 172551, January 15, 2014.

Justiciable question; definition of. A justiciable question is one which is
inherently susceptible of being decided on grounds recognized by law, as where
the court finds that there are constitutionally-imposed limits on the exercise of
the powers conferred on a political branch of the government. Our inquiry is
limited to whether such statutory grant of disciplinary authority to the President
violates the Constitution, particularly the core constitutional principle of the
independence of the Office of the Ombudsman. Emilio A. Gonzales III v. Office of
the President, etc., et al./Wendell Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et
al., G.R. No. 196231/G.R. No. 196232, January 28, 2014.

Ombudsman; investigative and disciplinary powers; scope. The Ombudsmans
broad investigative and disciplinary powers include all acts of malfeasance,
misfeasance, and nonfeasance of all public officials, including Members of the
Cabinet and key Executive officers, during their tenure. To support these broad
powers, the Constitution saw it fit to insulate the Office of the Ombudsman from
the pressures and influences of officialdom and partisan politics and from fear of
external reprisal by making it an independent office. Emilio A. Gonzales III v.
Office of the President, etc., et al./Wendell Bareras-Sulit v. Atty. Paquito N. Ochoa,
Jr., et al., G.R. No. 196231/G.R. No. 196232, January 28, 2014.

Ombudsman; powers and functions. Under Section 12, Article XI of the 1987
Constitution, the Office of the Ombudsman is envisioned to be the protector of
the people against the inept, abusive, and corrupt in the Government, to
function essentially as a complaints and action bureau. This constitutional vision
of a Philippine Ombudsman practically intends to make the Ombudsman an
authority to directly check and guard against the ills, abuses, and excesses of the
&

bureaucracy. As the Ombudsman is expected to be an activist watchman, the
Court has upheld its actions, although not squarely falling under the broad
powers granted it by the Constitution and by R.A. No. 6770, if these actions are
reasonably in line with its official function and consistent with the law and the
Constitution. Emilio A. Gonzales III v. Office of the President, etc., et al./Wendell
Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No.
196232, January 28, 2014.

Private lands acquired for agrarian reform; primary jurisdiction. The Land Bank
of the Philippines is primarily charged with determining land valuation and
compensation for all private lands acquired for agrarian reform purposes. But
this determination is only preliminary. The landowner may still take the matter
of just compensation to the court for final adjudication. Thus, we clarify and
reiterate: the original and exclusive jurisdiction over all petitions for the
determination of just compensation under R.A. No. 6657 rests with the RTC-SAC.
But, in its determination, the RTC-SAC must take into consideration the factors
laid down by law and the pertinent DAR regulations. Land Bank of the
Philippines v. Yatco Agricultural Enterprises, G.R. No. 172551, January 15,
2014.

Public officer; discourtesy in the performance of official duties. As a public officer
and trustee for the public, it is the ever existing responsibility of respondent
sheriff to demonstrate courtesy and civility in his official actuations with the
public. Based on the transcript of the altercation, it is readily apparent that
respondent has indeed been remiss in the duty of observing courtesy in serving
the public. He should have exercised restraint in dealing with the complainant,
instead of allowing the quarrel to escalate into a hostile encounter. The balm of a
clean conscience should have been sufficient to relieve any hurt or harm
respondent felt from complainants criticisms in the performance of his duties.
On the contrary, respondents demeanor tarnished the image not only of his
office but that of the judiciary as a whole, exposing him to disciplinary measure.
Atty. Virgillo P. Alconera v. Alfredo T. Pallanan, A.M. No. P-12-3069, January 20,
2014.

Public officer; making untruthful statements. The charge of making untruthful
statements must fail. While the statements mentioned in respondents complaint-
'

affidavit were not reflected in the transcript submitted by the complainant, this
actuality is not conclusive evidence that such event did not take place. As
claimed by respondent, complainants clerk was only able to record a part of the
argument. We cannot then discount the probability that there is more to the
argument than what was caught on video and there remains the possibility that
what respondent narrated and what complainant recorded both actually
transpired. Atty. Virgillo P. Alconera v. Alfredo T. Pallanan, A.M. No. P-12-3069,
January 20, 2014.

Section 8(2) of RA 6770; constitutional; the Office of the Special Prosecutor is
not constitutionally within the Office of the Ombudsman; not entitled to the
independence the Office of the Ombudsman enjoys under the Constitution. The
Court resolved to maintain the validity of Section 8(2) of R.A. No. 6770 insofar as
the Special Prosecutor is concerned. The Court does not consider the Office of the
Special Prosecutor to be constitutionally within the Office of the Ombudsman and
is, hence, not entitled to the independence the latter enjoys under the
Constitution. Emilio A. Gonzales III v. Office of the President, etc., et al./Wendell
Bareras-Sulit v. Atty. Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No.
196232, January 28, 2014.

Section 8(2) of RA No. 6770; unconstitutional; vesting of disciplinary authority
in the President over the Deputy Ombudsman; violation of the independence of
the Ombudsman. In more concrete terms, we rule that subjecting the Deputy
Ombudsman to discipline and removal by the President, whose own alter egos
and officials in the Executive department are subject to the Ombudsmans
disciplinary authority, cannot but seriously place at risk the independence of the
Office of the Ombudsman itself. Section 8(2) of R.A. No. 6770 intruded upon the
constitutionally-granted independence of the Office of the Ombudsman. By so
doing, the law directly collided not only with the independence that the
Constitution guarantees to the Office of the Ombudsman, but inevitably with the
principle of checks and balances that the creation of an Ombudsman office seeks
to revitalize. What is true for the Ombudsman must equally and necessarily be
true for her Deputies who act as agents of the Ombudsman in the performance of
their duties. The Ombudsman can hardly be expected to place her complete trust
in her subordinate officials who are not as independent as she is, if only because
they are subject to pressures and controls external to her Office. This need for
(

complete trust is true in an ideal setting and truer still in a young democracy like
the Philippines where graft and corruption is still a major problem for the
government. For these reasons, Section 8(2) of R.A. No. 6770, providing that the
President may remove a Deputy Ombudsman, should be declared void. Emilio A.
Gonzales III v. Office of the President, etc., et al./Wendell Bareras-Sulit v. Atty.
Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No. 196232, January 28,
2014.

Special Prosecutor; structural relationship with the Ombudsman; the Special
Prosecutor is by no means an ordinary subordinate but one who effectively and
directly aids the Ombudsman in the exercise of his/her duties, which include
investigation and prosecution of officials in the Executive Department. Congress
recognized the importance of the Special Prosecutor as a necessary adjunct of
the Ombudsman, aside from his or her deputies, by making the Office of the
Special Prosecutor and organic component of the Office of the Ombudsman and by
granting the Ombudsman control and supervision over that office. This power of
control and supervision includes vesting the Office of the Ombudsman with the
power to assign duties to the Special Prosecutor as he or she may deem fit. Even
if the Office of the Special Prosecutor is not expressly made part of the
composition of the Office of the Ombudsman, the role it performs as an organic
component of that Office militates against a differential treatment between the
Ombudsmans Deputies, on one hand, and the Special Prosecutor himself, on the
other. What is true for the Ombudsman must be equally true, not only for her
Deputies but, also for other lesser officials of that Office who act directly as
agents of the Ombudsman herself in the performance of her duties. Emilio A.
Gonzales III v. Office of the President, etc., et al./Wendell Bareras-Sulit v. Atty.
Paquito N. Ochoa, Jr., et al., G.R. No. 196231/G.R. No. 196232, January 28,
2014.

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Corporations; liability of corporate officers. As a general rule, the officer cannot be held personally liable with the corporation, whether
civilly or otherwise, for the consequences his acts, if acted for and in behalf of the corporation, within the scope of his authority and in
good faith. Rodolfo Laborte, et al. v. Pagsanjan Tourism Consumers Cooperative, et al., G.R. No. 183860, January 15, 2014.

Banks; degree of diligence. Being a banking institution, DBP owed it to Guaria Corporation to exercise the highest degree of diligence,
as well as to observe the high standards of integrity and performance in all its transactions because its business was imbued with public
interest. The high standards were also necessary to ensure public confidence in the banking system. Development Bank of the Philippines
(DBP) v. Guaria Agricultural and Realty Development Corporation, G.R. No. 160758. January 15, 2014.