Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
A.M. No. P-07-2327 July 12, 2007
[Formerly OCA-I.P.I. No. 04-1934-P]
NENA GIMENA SOLWAY, Complainant,
vs.
ARIEL R. PASCASIO, Sheriff III, MTCC, Branch 5, Olongapo City, MICHAEL P. UCLARAY, Sheriff III,
MTCC-OCC-Olongapo City and BENJAMIN M. TULIO, Sheriff III, MTCC-OCC-Olongapo City, Re-
spondents.
RESOLUTION
TINGA, J.:
1
This administrative matter pertains to a complaint dated 5 April 2004 filed by Nena Gimena Sol-
way (complainant) against Ariel R. Pascasio (Pascasio), Michael P. Uclaray (Uclaray) and Benja-
min M. Tulio (Tulio), charging them with Abuse of Authority and Harassment before the Office
of the Court Administrator (OCA). Pascasio holds the position of Sheriff III, Municipal Trial Court
in Cities (MTCC) Branch 5, Olongapo City, while Uclaray and Tulio are both employed as Sheriff
III of MTCC-OCC.
The complaint, couched in Tagalog, recites the antecedents, thus:
Ely Palenzuela (Palenzuela) is the owner of a building in Baloy Beach, Bo. Barretto, Olongapo
City. She leased it to complainant, who opened at the premises an establishment called Mynes
Inn and Restaurant. Complainant paid a monthly rental of 13,200.00. Prior to the expiration of
the lease contract on 1 August 2003, the parties agreed on its renewal for five (5) years with a
ten percent (10%) increase in rentals or 15,000.00 monthly, but no formal contract was exe-
cuted because Palenzuela had left for Hawaii. Upon Palenzuelas return, she increased the
monthly rental to 25,000.00 and shortened the period of lease to one year. The parties failed
to reach an agreement. Hence, the matter was referred to the Office of the Lupong Tagapa-
mayapa (Lupon) of Barangay Barretto.
2
Before the Lupon, the parties signed an Amicable Settlement dated 28 January 2004, wherein
it was agreed that the monthly rental is 20,000.00; that complainant will pay 240,000.00 as
rental for one year after the finalization of the contract, and; that the contract will be renewed
yearly.
On 9 February 2004, Palenzuela went to complainants restaurant. She produced a copy of a No-
3
tice of Execution signed by Barangay Chairman Carlito A. Baloy, who turned out to be Palenzue-
las brother, and forced complainant to sign the same. Complainant refused to do so. The follow-
ing day, Pascasio and Uclaray, with the same copy of the Notice of Execution in tow, also forced
and threatened complainant to sign. Out of fear, complainant relented and signed the Notice of
Execution.
In the morning of 20 February 2004, Pascasio and Uclaray, accompanied by Isagani Saludo and
Tulio, returned to complainants restaurant. They introduced themselves as sheriffs and ordered
complainant to take all her properties out of the restaurant. The latter refused, insisting that
there was no court order authorizing the execution and that an agreement for the renewal of
 4
the lease contract had already been reached. At around 3:00 p.m. on the same day, the baran-
gay chairman ordered respondents to take complainants stuff out of the restaurant and into the
street. Respondents complied. Thereafter, respondents padlocked all the rooms and ordered all
5
customers to get out of the establishment.
In her complaint, complainant questioned the presence of respondents in the premises, consid-
6
ering that there was no court order to eject her.
On 25 May 2004, the Court Administrator endorsed the complaint to respondents for their com-
7
ment.
8
In their Joint Comment/explanation, respondents admitted their presence in complainants es-
tablishment. According to them, they were there to provide assistance in securing compliance
with the Amicable Settlement. Professing innocence of any act of harassment or abuse of au-
thority, they further claimed that they were instructed by Clerk of Court and City Sheriff
Alexander Rimando to observe the implementation of the arbitration award. They were thus
mere witnesses to complainants refusal to comply with the settlement process which was
under the control and supervision of the barangay chairman. Respondents accordingly prayed
for the dismissal of the complaint.
9
On 13 December 2004, the OCA submitted a Report finding that respondents exceeded their
functions when they participated in the execution of the Amicable Settlement. Nevertheless,
the OCA observed that there was no showing that respondents profited from their participation
in the exercise and on that basis recommended the dismissal of the complaint for lack of mer-
10
it.
11
In the Resolution dated 7 February 2005, the parties were required to manifest within ten (10)
days from notice, if they are willing to submit the case for resolution based on the pleadings
12
filed. On 10 March 2005, complainant made a manifestation to that effect while respondents
13
submitted a similar manifestation on 9 February 2007.
Respondents are liable.
The Amicable Settlement reached by the parties before the Barangay Lupon is susceptible to le-
gal enforcement. However, the Local Government Code mandates that it is the Lupon itself
which is tasked to enforce by execution the amicable settlement or arbitration award within six
(6) months from the date of settlement. Upon the lapse of such time, the settlement may only
be enforced by filing an action before the appropriate court. Section 417 of the Local Govern-
ment Code reads:
SEC. 417. Execution.The amicable settlement or arbitration award may be enforced by execu-
tion by the [L]upon within six (6) months from the date of the settlement. After the lapse of
such time, the settlement may be enforced by action in the proper city or municipal court.
Clearly, the implementation of the Notice of Execution was then outside the legitimate concern
of the MTCC, of any of its officers or of any other judicial officer. The barangay chairmans letter
to the MTCC seeking assistance in the enforcement of the Amicable Settlement is not by any
measure the court action contemplated by law as it does not confer jurisdiction on the MTCC
over the instant dispute. Such could be accomplished only through the initiation of the appropri-
ate adversarial proceedings in court in accordance with Section 417 of the Local Government
Code. The OCA correctly stated that there is no justiciable case filed before the MTCC that could
have prompted respondents to act accordingly.
Mere presence of a sheriff in a place of execution where the court has no business is frowned
14
upon. Such act elicits the appearance of impropriety. Participation or intervention in the proc-
ess is a more grievous act which exacts a more stringent sanction. And whether it is unexplained
presence or active participation, the act gives rise to the impression that the execution of the
Amicable Settlement is upon lawful order of the court.
The situation at bar did not involve any court order. The execution was undertaken only under
the authority of the barangay chairman, not even that of the Lupon. Even if it was done under
the auspices of the Lupon, the presence of respondents would still not be warranted. Both the
barangay chairman and the Lupon are components of the local government unit which, in turn,
is subsumed under the executive branch of government. As the intended execution of the settle-
ment in this instance was inherently executive in nature and, therefore, extrajudicial, it necessa-
rily follows that judicial officers cannot participate in the exercise. The misdeeds of respondents
unnecessarily put the integrity of the court to which they are assigned and the dignity of the in-
stitution that is the judiciary on the line.
The fact of willful participation is penalized especially when the acts of the judicial officer con-
cerned are not within his or her legal authority. Complainant alleged that respondents actually
participated in the execution of the Amicable Settlement and the OCA observed that these alle-
15
gations were not sufficiently refuted by respondents. More tellingly, the defense of respond-
16
ents that they were acting under the order of the Clerk of Court is belied by the directive is-
sued by the latter directing respondents to explain their presence at the site of the implementa-
tion of the Notice of Execution.
Furthermore, the functions of sheriffs, such as respondents, are enumerated under the 2002 Re-
vised Manual for Clerks of Court, as follows:
2.2.4.1 serves and/or executes writs and processes addressed and/or assigned to him by the
Court and prepares and submits returns of his proceedings;
2.2.4.2 keeps custody of attached properties or goods;
2.2.4.3 maintains his own record books on writs of execution, writs of attachment, writs of re-
plevin, writs of injunction, and all other processes executed by him; and
2.2.4.4 performs such other duties as may be assigned by the Executive Judge, Presiding Judge
and/or Branch Clerk of Court.
Nothing in this Rule justifies their participation in the implementation of the Notice of Execu-
tion. Clearly, respondents were not acting within their authority. This further lends credence to
complainants claim that their presence was only meant to instill fear on her to make her sign
the Notice of Execution.
Respondents have exceeded their mandated duties when they interfered with functions that
should have been exercised only by barangay officials. Their actions run counter to the Code of
Conduct of Court Personnel which provides that court personnel shall expeditiously enforce
rules and implement orders of the court within the limits of their authority. As we have so reit-
erated in a previous ruling, a court employee is expected to do no more than what duty de-
mands and no less than what privilege permits. Though he may be of great help to specific indi-
viduals, but when that help frustrates and betrays the publics trust in the system, it cannot and
17
should not remain unchecked.
Sheriffs play an important role in the administration of justice since they are called upon to
serve court writs, execute all processes, and carry into effect the orders of the court with due
care and utmost diligence. As officers of the court, sheriffs are duty-bound to use reasonable
skill and diligence in the performance of their duties, and conduct themselves with propriety
18
and decorum and act above suspicion.
In the instant case, respondents failed to uphold the standard of integrity and prudence ought
to be exercised by officers of the court. Based on the foregoing, we are constrained to reverse
the recommendation of the OCA in dismissing the complaint.1avvphi1
We find that respondents unjustified presence in the implementation of the Amicable Settle-
ment despite the absence of an order from the court in tandem with its lack of jurisdiction over
the matter constitutes misconduct. Misconduct is defined as any unlawful conduct on the part
of the person concerned in the administration of justice prejudicial to the rights of parties or to
the right determination of the cause. It generally means wrongful, improper, unlawful conduct
19
motivated by a premeditated, obstinate or intentional purpose. Respondents impropriety
subjected the image of the court to public suspicion and distrust. Thus, they are guilty of simple
20
misconduct.
21
Under the Civil Service Rules, simple misconduct is punishable by suspension of one (1) month
and one (1) day to six (6) months.
WHEREFORE, respondents Ariel R. Pascasio, Sheriff III, Branch 5, MTCC, Olongapo City, Michael
P. Uclaray, Sheriff III, MTCC-OCC, and Benjamin M. Tulio, Sheriff III, MTCC-OCC, Olongapo City,
are found GUILTY of misconduct and are hereby SUSPENDED for a period of three (3) months
without pay, with a STERN WARNING that a repetition of the same or similar act will be dealt
with more severely.
SO ORDERED.
G.R. No. 158901 March 9, 2004
PROCESO QUIROS and LEONARDA VILLEGAS, petitioners,
vs.
MARCELO ARJONA, TERESITA BALARBAR, JOSEPHINE ARJONA, and CONCHITA ARJONA, re-
spondents.
DECISION
YNARES-SANTIAGO, J.:
Assailed in this petition for review is the decision of the Court of Appeals in an action for the ex-
ecution/enforcement of amicable settlement between petitioners Proceso Quiros and Leonarda
Villegas and respondent Marcelo Arjona. Appellate court reversed the decision of the Regional
Trial Court of Dagupan City-Branch 44 and reinstated the decision of the Municipal Trial Court of
San Fabian-San Jacinto, Pangasinan.
On December 19, 1996, petitioners Proceso Quiros and Leonarda Villegas filed with the office of
the barangay captain of Labney, San Jacinto, Pangasinan, a complaint for recovery of ownership
and possession of a parcel of land located at Labney, San Jacinto, Pangasinan. Petitioners sought
to recover from their uncle Marcelo Arjona, one of the respondents herein, their lawful share of
the inheritance from their late grandmother Rosa Arjona Quiros alias Doza, the same to be seg-
regated from the following parcels of land:
a) A parcel of land (Lot 1, plan Psu-189983, L.R. Case No. D-614, LRC Record No. N- 22630), situ-
ated in the Barrio of Labney, Torud, Municipality of San Jacinto, Province of Pangasinan x x x
Containing an area of Forty Four Thousand Five Hundred and Twenty (44,520) square meters,
more or less, covered by Tax Decl. No. 607;
b) A parcel of Unirrig. riceland situated at Brgy. Labney, San Jacinto, San Jacinto, Pangasinan with
an area of 6450 sq. meters, more or less declared under Tax Decl. No. 2066 of the land records
of San Jacinto, Pangasinan assessed at P2390.00 x x x;
c) A parcel of Unirrig. riceland situated at Brgy. Labney, San Jacinto, Pangasinan with an area of
6450 sq. meters, more or less, declared under Tax Declaration No. 2047 of the land records of
San Jacinto, Pangasinan assessed at P1700.00 x x x
d) A parcel of Unirrig. riceland situated at Brgy. Labney, San Jacinto, Pangasinan assessed at
P5610.00 x x x;
e) A parcel of Cogon land situated at Brgy. Labney, San Jacinto, Pangasinan, with an area of
14133 sq. meters, more or less declared under Tax Declaration No. 14 of the land records of San
1
Jacinto, Pangasinan assessed at P2830.00 x x x.
On January 5, 1997, an amicable settlement was reached between the parties. By reason there-
of, respondent Arjona executed a document denominated as "PAKNAAN" ("Agreement", in Pan-
gasinan dialect), which reads:
AGREEMENT
I, MARCELO ARJONA, of legal age, resident of Barangay Sapang, Buho, Palayan City, Nueva Ecija,
have a land consisting of more or less one (1) hectare which I gave to Proceso Quiros and Leo-
narda Villegas, this land was inherited by Doza that is why I am giving the said land to them for it
is in my name, I am affixing my signature on this document for this is our agreement besides
th
there are witnesses on the 5 day (Sunday) of January 1997.
Signed in the presence of:
(Sgd) Avelino N. De la Masa, Jr.
(Sgd) Marcelo Arjona
Witnesses:
1) (Sgd.) Teresita Balarbar
2) (Sgd.) Josephine Arjona
3) (Sgd.) Conchita Arjona
On the same date, another "PAKNAAN" was executed by Jose Banda, as follows:
AGREEMENT
I, JOSE BANDA, married to Cecilia L. Banda, of legal age, and resident of Sitio Torrod, Barangay
Labney, San Jacinto, Pangasinan. There is a land in which they entrusted to me and the same
land is situated in Sitio Torrod, Brgy. Labney, San Jacinto, Pangasinan, land of Arjona family.
I am cultivating/tilling this land but if ever Leonarda Villegas and Proceso Quiros would like to
get this land, I will voluntarily surrender it to them.
In order to attest to the veracity and truthfulness of this agreement, I affixed (sic) my signature
th
voluntarily below this document this 5 day (Sunday) of January 1997.
(Sgd.) Jose Banda
Signed in the presence of:
(Sgd) Avelino N. de la Masa, Sr.
Barangay Captain
Brgy. Labney, San Jacinto
Pangasinan
Witnesses:
1) Irene Banda
(sgd.)
2) Jose (illegible) x x x
Petitioners filed a complaint with the Municipal Circuit Trial Court with prayer for the issuance
of a writ of execution of the compromise agreement which was denied because the subject
property cannot be determined with certainty.
The Regional Trial Court reversed the decision of the municipal court on appeal and ordered the
issuance of the writ of execution.
Respondents appealed to the Court of Appeals, which reversed the decision of the Regional Trial
2
Court and reinstated the decision of the Municipal Circuit Trial Court.
Hence, this petition on the following errors:
I
THE PAKNAAN BEING A FINAL AND EXECUTORY JUDGMENT UNDER THE LAW IS AN IMMUTABLE
JUDGMENT CAN NOT BE ALTERED, MODIFIED OR CHANGED BY THE COURT INCLUDING THE
HIGHEST COURT; and
II
THE SECOND PAKNAAN ALLEGEDLY EXECUTED IN CONJUNCTION WITH THE FIRST PAKNAAN WAS
NEVER ADDUCED AS EVIDENCE BY EITHER OF THE PARTIES, SO IT IS ERROR OF JURISDICTION TO
CONSIDER THE SAME IN THE DECISION MAKING.
The pivotal issue is the validity and enforceability of the amicable settlement between the par-
ties and corollary to this, whether a writ of execution may issue on the basis thereof.
In support of their stance, petitioners rely on Section 416 of the Local Government Code which
provides that an amicable settlement shall have the force and effect of a final judgment upon
the expiration of 10 days from the date thereof, unless repudiated or nullified by the proper
court. They argue that since no such repudiation or action to nullify has been initiated, the mu-
nicipal court has no discretion but to execute the agreement which has become final and execu-
tory.
Petitioners likewise contend that despite the failure of the Paknaan to describe with certainty
the object of the contract, the evidence will show that after the execution of the agreement, re-
spondent Marcelo Arjona accompanied them to the actual site of the properties at Sitio Torod,
Labney, San Jacinto, Pangasinan and pointed to them the 1 hectare property referred to in the
said agreement.
In their Comment, respondents insist that respondent Arjona could not have accompanied peti-
tioners to the subject land at Torrod, Labney because he was physically incapacitated and there
was no motorized vehicle to transport him to the said place.
The Civil Code contains salutary provisions that encourage and favor compromises and do not
even require judicial approval. Thus, under Article 2029 of the Civil Code, the courts must en-
deavor to persuade the litigants in a civil case to agree upon some fair compromise. Pursuant to
Article 2037 of the Civil Code, a compromise has upon the parties the effect and authority of res
judicata, and this is true even if the compromise is not judicially approved. Articles 2039 and
2031 thereof also provide for the suspension of pending actions and mitigation of damages to
the losing party who has shown a sincere desire for a compromise, in keeping with the Codes
3
policy of encouraging amicable settlements.
Cognizant of the beneficial effects of amicable settlements, the Katarungang Pambarangay Law
(P.D. 1508) and later the Local Government Code provide for a mechanism for conciliation
where party-litigants can enter into an agreement in the barangay level to reduce the deteriora-
tion of the quality of justice due to indiscriminate filing of court cases. Thus, under Section 416
of the said Code, an amicable settlement shall have the force and effect of a final judgment of
the court upon the expiration of 10 days from the date thereof, unless repudiation of the settle-
ment has been made or a petition to nullify the award has been filed before the proper court
Petitioners submit that since the amicable settlement had not been repudiated or impugned be-
fore the court within the 10-day prescriptive period in accordance with Section 416 of the Local
Government Code, the enforcement of the same must be done as a matter of course and a writ
of execution must accordingly be issued by the court.
Generally, the rule is that where no repudiation was made during the 10-day period, the amica-
ble settlement attains the status of finality and it becomes the ministerial duty of the court to
implement and enforce it. However, such rule is not inflexible for it admits of certain exceptions.
4
In Santos v. Judge Isidro, the Court observed that special and exceptional circumstances, the
imperatives of substantial justice, or facts that may have transpired after the finality of judg-
ment which would render its execution unjust, may warrant the suspension of execution of a de-
cision that has become final and executory. In the case at bar, the ends of justice would be frus-
trated if a writ of execution is issued considering the uncertainty of the object of the agreement.
To do so would open the possibility of error and future litigations.
The Paknaan executed by respondent Marcelo Arjona purports to convey a parcel of land con-
sisting of more or less 1 hectare to petitioners Quiros and Villegas. Another Paknaan, prepared
on the same date, and executed by one Jose Banda who signified his intention to vacate the par-
cel of land he was tilling located at Torrod, Brgy. Labney, San Jacinto, Pangasinan, for and in be-
half of the Arjona family. On ocular inspection however, the municipal trial court found that the
land referred to in the second Paknaan was different from the land being occupied by peti-
tioners. Hence, no writ of execution could be issued for failure to determine with certainty what
parcel of land respondent intended to convey.
In denying the issuance of the writ of execution, the appellate court ruled that the contract is
null and void for its failure to describe with certainty the object thereof. While we agree that no
writ of execution may issue, we take exception to the appellate courts reason for its denial.
Since an amicable settlement, which partakes of the nature of a contract, is subject to the same
legal provisions providing for the validity, enforcement, rescission or annulment of ordinary con-
tracts, there is a need to ascertain whether the Paknaan in question has sufficiently complied
5
with the requisites of validity in accordance with Article 1318 of the Civil Code.
There is no question that there was meeting of the minds between the contracting parties. In
executing the Paknaan, the respondent undertook to convey 1 hectare of land to petitioners
who accepted. It appears that while the Paknaan was prepared and signed by respondent Arjo-
na, petitioners acceded to the terms thereof by not disputing its contents and are in fact now
seeking its enforcement. The object is a 1-hectare parcel of land representing petitioners inheri-
tance from their deceased grandmother. The cause of the contract is the delivery of petitioners
share in the inheritance. The inability of the municipal court to identify the exact location of the
inherited property did not negate the principal object of the contract. This is an error occa-
sioned by the failure of the parties to describe the subject property, which is correctible by ref-
ormation and does not indicate the absence of the principal object as to render the contract
void. It cannot be disputed that the object is determinable as to its kind, i.e.1 hectare of land as
6
inheritance, and can be determined without need of a new contract or agreement. Clearly, the
Paknaan has all the earmarks of a valid contract.
Although both parties agreed to transfer one-hectare real property, they failed to include in the
written document a sufficient description of the property to convey. This error is not one for nul-
lification of the instrument but only for reformation.
Article 1359 of the Civil Code provides:
When, there having been a meeting of the minds of the parties to a contract, their true inten-
tion is not expressed in the instrument purporting to embody the agreement by reason of mis-
take, fraud, inequitable conduct or accident, one of the parties may ask for the reformation of
the instrument to the end that such true intention may be expressed.
If mistake, fraud, inequitable conduct, or accident has prevented a meeting of the minds of the
parties, the proper remedy is not reformation of the instrument but annulment of the contract.
Reformation is a remedy in equity whereby a written instrument is made or construed so as to
express or conform to the real intention of the parties where some error or mistake has been
7
committed. In granting reformation, the remedy in equity is not making a new contract for the
parties, but establishing and perpetuating the real contract between the parties which, under
the technical rules of law, could not be enforced but for such reformation.
In order that an action for reformation of instrument as provided in Article 1359 of the Civil
Code may prosper, the following requisites must concur: (1) there must have been a meeting of
the minds of the parties to the contract; (2) the instrument does not express the true intention
of the parties; and (3) the failure of the instrument to express the true intention of the parties is
8
due to mistake, fraud, inequitable conduct or accident.
When the terms of an agreement have been reduced to writing, it is considered as containing all
the terms agreed upon and there can be, between the parties and their successors in interest,
no evidence of such terms other than the contents of the written agreement, except when it
fails to express the true intent and agreement of the parties thereto, in which case, one of the
parties may bring an action for the reformation of the instrument to the end that such true in-
9
tention may be expressed.
Both parties acknowledge that petitioners are entitled to their inheritance, hence, the remedy
of nullification, which invalidates the Paknaan, would prejudice petitioners and deprive them of
their just share of the inheritance. Respondent can not, as an afterthought, be allowed to re-
nege on his legal obligation to transfer the property to its rightful heirs. A refusal to reform the
Paknaan under such circumstances would have the effect of penalizing one party for negligent
conduct, and at the same time permitting the other party to escape the consequences of his
negligence and profit thereby. No person shall be unjustly enriched at the expense of another.
WHEREFORE, in view of the foregoing, the petition is DENIED. The Decision dated March 21,
2003 of the Court of Appeals, which reversed the decision of the Regional Trial Court and rein-
stated the decision of the Municipal Trial Court, is AFFIRMED. This is without prejudice to the fil-
ing by either party of an action for reformation of the Paknaan executed on January 5, 1997.
SO ORDERED.
 THIRD DIVISION

ROSARIA LUPITAN PANG-ET, G.R. No. 167261

Petitioner,
Present:

YNARES-SANTIAGO, J.,
- versus - Chairperson,
AUSTRIA-MARTINEZ,
CALLEJO, SR.,*
CHICO-NAZARIO, and
CATHERINE MANACNES-DAO-AS, Heir of NACHURA, JJ.
LEONCIO MANACNES and FLORENTINA MAN-
ACNES, Promulgated:
Respondent.
March 2, 2007
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
 DECISION

CHICO-NAZARIO, J.:

Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Civil Proce-
dure, assailing the Decision[1] of the Court of Appeals in CA-G.R. SP No. 78019, dated 9 Febru-
ary 2005, which reversed and set aside the Judgment[2] of the Regional Trial Court (RTC),
Branch 36, Bontoc, Mountain Province, and reinstated the Resolution[3] of the Municipal Circuit
Trial Court (MCTC) of Besao-Sagada, Mountain Province dismissing herein petitioners action for
Enforcement of Arbitration Award and Damages.

The instant petition draws its origin from an Action[4] for recovery of possession of real
property situated in Sitio Abatan, Barrio Dagdag, Sagada filed by herein petitioner before the
MCTC of Besao-Sagada, Mountain Province on 9 November 1994, against the spouses Leon-
cio and Florentina Manacnes, the predecessors-in-interest of herein respondent.

On 23 February 1995, during the course of the pre-trial, the parties, through their re-
spective counsels, agreed to refer the matter to the Barangay Lupon (Lupon) of Dagdag,Saga-
da for arbitration in accordance with the provisions of the Katarungang Pambaran-
gay Law.[5] Consequently, the proceedings before the MCTC were suspended, and the case was
remanded to the Lupon for resolution.[6]

Thereafter, the Lupon issued a Certification to File Action on 26 February 1995 due to
the refusal of the Manacnes spouses to enter into an Agreement for Arbitration and their insist-
ence that the case should go to court. On 8 March 1995, the Certification, as well as the records
of the case, were forwarded to the MCTC.
 An Order was issued by the MCTC on 7 April 1995, once more remanding the matter for
conciliation by the Lupon and ordering the Lupon to render an Arbitration Award thereon. Ac-
cording to the MCTC, based on the records of the case, an Agreement for Arbitration was exe-
cuted by the parties concerned; however, the Lupon failed to issue an Arbitration Award as pro-
vided under the Katarungang Pambarangay Law, so that, the case must be returned to the Lu-
pon until an Arbitration Award is rendered.

In compliance with the MCTC Order, the Lupon rendered an Arbitration Award on 10
May 1995 ordering herein petitioner to retrieve the land upon payment to the spouses Mana-
cnes of the amount of P8,000.00 for the improvements on the land. Aggrieved, Leoncios wid-
ow,[7] Florentina Manacnes, repudiated the Arbitration Award but her repudiation was rejected
by the Lupon. Thereafter, the MCTC was furnished with copies of the Arbitration Award.

On 1 June 1995, herein petitioner filed with the Lupon a Motion for Execution of the Ar-
bitration Award. On the other hand, Florentina Manacnes filed a Motion with the MCTC for the
resumption of the proceedings in the original case for recovery of possession and praying that
the MCTC consider her repudiation of the Arbitration Award issued by the Lupon.

Subsequently, the MCTC heard the Motion of Florentina Manacnes notwithstanding the
latters failure to appear before the court despite notice. The MCTC denied Florentina Mana-
cnes Motion to repudiate the Arbitration Award elucidating that since the movant failed to take
any action within the 10-day reglementary period provided for under the Katarungang Pambar-
angay Law, the arbitration award has become final and executory. Furthermore, upon motion of
herein petitioner Pang-et, the MCTC issued an Order remanding the records of the case to the
Lupon for the execution of the Arbitration Award. On 31 August 1995, the then incumbent Pu-
nong Barangay of Dagdag issued a Notice of Execution of the Award.
 Said Notice of Execution was never implemented. Thus, on 16 October 2001, herein peti-
tioner Pang-et filed with the MCTC an action for enforcement of the Arbitration Award which
was sought to be dismissed by the heir of the Manacnes spouses.[8] The heir of the Mana-
cnes spouses argues that the Agreement for Arbitration and the Arbitration Award are void, the
Agreement for Arbitration not having been personally signed by the spouses Manacnes, and the
Arbitration Award having been written in English a language not understood by the parties.

In its Resolution dated 20 August 2002, the MCTC dismissed the Petition for Enforce-
ment of Arbitration Award in this wise:

x x x Are defendants estopped from questioning the proceedings before the Lupon Tagapamaya-
pa concerned?

The defendants having put in issue the validity of the proceedings before the lupon con-
cerned and the products thereof, they are not estopped. It is a hornbook rule that a null and
void act could always be questioned at any time as the action or defense based upon it is impre-
scriptible.

The second issue: Is the agreement to Arbitrate null and void? Let us peruse the perti-
nent law dealing on this matter which is Section 413 of the Local Government Code of 1991 (RA
7160), to wit:

Section 413 (a) The parties may, at any stage of the proceedings, agree in writing that they shall
abide by the arbitration award of the lupon chairman or the pangkat. x x x

The foregoing should be taken together with Section 415 of the same code which provides:

Section 415. Appearance of parties in person. In all katarungang pambarangay proceedings, the
parties must appear in person without the assistance of counsel or representative, except for
minors and incompetents who may be assisted by their next-of-kin who are not lawyers.

It is very clear from the foregoing that personal appearance of the parties in conciliation
proceedings before a Lupon Tagapamayapa is mandatory. Likewise, the execution of the agree-
ment to arbitrate must be done personally by the parties themselves so that they themselves
are mandated to sign the agreement.
 Unfortunately, in this case, it was not respondents-spouses [Manacnis] who signed the
agreement to arbitrate as plaintiff herself admitted but another person. Thus, it is very clear
that the mandatory provisos of Section 413 and 415 of RA 7160 are violated. Granting arguen-
do that it was Catherine who signed the agreement per instruction of her parents, will it cure
the violation? The answer must still be in the negative. As provided for by the cited provisos of
RA 7160, if ever a party is entitled to an assistance, it shall be done only when the party con-
cerned is a minor or incompetent. Here, there is no showing that the spouses [Manacnis] were
incompetent. Perhaps very old but not incompetent. Likewise, what the law provides is assis-
tance, not signing of agreements or settlements.

Just suppose the spouses [Manacnis] executed a special power of attorney in favor of
their daughter Catherine to attend the proceedings and to sign the agreement to arbitrate? The
more that it is proscribed by the Katarungang Pambarangay Law specifically Section 415 of RA
7160 which mandates the personal appearance of the parties before the lupon and likewise pro-
hibits the appearance of representatives.

In view of the foregoing, it could now be safely concluded that the questioned agree-
ment to arbitrate is inefficacious for being violative of the mandatory provisions of RA 7160 par-
ticularly sections 413 and 415 thereof as it was not the respondents-spouses [Manacnis] who
signed it.

The third issue: Is the Arbitration Award now sought to be enforced effective? Much to
be desired, the natural flow of events must follow as a consequence. Considering that the agree-
ment to arbitrate is inefficacious as earlier declared, it follows that the arbitration award which
emanated from it is also inefficacious. Further, the Arbitration Award by itself, granting arguen-
do that the agreement to arbitrate is valid, will readily show that it does not also conform with
the mandate of the Katarungang Pambarangay Law particularly Section 411 thereto which pro-
vides:

Sec. 411. Form of Settlement All amicable settlements shall be in writing in a language or dialect
known to the parties x x x. When the parties to the dispute do not use the same language or di-
alect, the settlement shall be written in the language known to them.

Likewise, the implementing rules thereof, particularly Section 13 provides:

Sec. 13 Form of Settlement and Award. All settlements, whether by mediation, conciliation or
arbitration, shall be in writing, in a language or dialect known to the parties. x x x

It is of no dispute that the parties concerned belong to and are natives of the scenic and
serene community of Sagada, Mt. Province who speak the Kankanaey language. Thus, the Arbi-
tration Award should have been written in the Kankanaey language. However, as shown by the
Arbitration Award, it is written in English language which the parties do not speak and therefore
a further violation of the Katarungang Pambarangay Law.
 IN THE LIGHT of all the foregoing considerations, the above-entitled case is hereby dis-
missed.[9]

Petitioner Pang-ets Motion for Reconsideration having been denied, she filed an Appeal
before the RTC which reversed and set aside the Resolution of the MCTC and remanded the
case to the MCTC for further proceedings. According to the RTC:

As it appears on its face, the Agreement for Arbitration in point found on page 51 of
the expediente, dated Feb. 6, 1995, and attested by the Pangkat Chairman of the Office of the-
Barangay Lupon of Dagdag, Sagada was signed by the respondents/defendants spouses Mana-
cnis. The representative of the Appellee in the instant case assails such Agreement claiming that
the signatures of her aforesaid predecessors-in-interest therein were not personally affixed by
the latter or are falsified-which in effect is an attack on the validity of the document on the
ground that the consent of the defendants spouses Manacnis is vitiated by fraud. Indulging
the Appellee Heirs of Manacnis its contention that such indeed is the truth of the matter, the
fact still remains as borne out by the circumstances, that neither did said original defendants
nor did any of such heirs effectively repudiate the Agreement in question in accordance with the
procedure outlined by the law, within five (5) days from Feb. 6, 1995, on the ground as above-
stated (Secs. 413 (a), 418, RA 7160; Secs. 7, 13, KP Law; Sec. 12, Rule IV, KP Rules). As mandated,
such failure is deemed a waiver on the part of the defendants spouses Manacnis to challenge
the Agreement for Arbitration on the ground that their consent thereto is obtained and vitiated
by fraud (Sec. 12, Par. 3, KP Rules). Corollarily, the Appellee Heirs being privy to the now de-
ceased original defendants should have not been permitted by the court a quo under the equi-
table principle of estoppel, to raise the matter in issue for the first time in the present case (Lo-
pez vs. Ochoa, 103 Phil. 94).
 The Arbitration Award relative to Civil Case 83 (B.C. No. 07) dated May 10, 1995, written
in English, attested by the Punong Barangay of Dagdag and found on page 4 of the record is like-
wise assailed by the Appellee as void on the ground that the English language is not known by
the defendants spouses Manacnis who are Igorots. Said Appellee contends that the document
should have been written in Kankana-ey, the dialect known to the party (Sec. 413 (b), RA 7160;
Sec. 7, Par. 2, KP law, Sec. 11, KP Rules). On this score, the court a quo presumptuously con-
cluded on the basis of the self-serving mere say-so of the representative of the Appellee that
her predecessors did not speak or understand English. As a matter of judicial notice, American
Episcopalian Missionaries had been in Sagada, Mountain Province as early as 1902 and continu-
ously stayed in the place by turns, co-mingling with the indigenous people thereat, instructing
and educating them, and converting most to the Christian faith, among other things, until the
former left about twenty years ago. By constant association with the white folks, the natives too
old to go to school somehow learned the Kings English by ear and can effectively speak and
communicate in that language. Any which way, even granting arguendo that the defendants
spouses Manacnis were the exceptions and indeed totally ignorant of English, no petition to nul-
lify the Arbitration award in issue on such ground as advanced was filed by the party or any of
the Appellee Heirs with the MCTC of Besao-Sagada, within ten (10) days from May 10, 1995, the
date of the document. Thus, upon the expiration thereof, the Arbitration Award acquired the
force and effect of a final judgment of a court (Sec. 416, RA 7160; Sec. 11, KP Law; Sec. 13, KP
Rules); conclusive upon the original defendants in Civil Case 83 (B.C. No. 07) and the Appellee-
Heirs herein privy to said defendants.

In the light thereof, the collateral attack of the Appellee on the Agreement for Arbitra-
tion and Arbitration Award re Civil Case 83 (B.C. No. 07) should not have in the first place been
given due course by the court a quo. In which case, it would not have in the logical flow of
things declared both documents inefficacious; without which pronouncements, said court
would not have dismissed the case at bar.

Wherefore, Judgment is hereby rendered Reversing and Setting Aside the Resolution ap-
pealed from, and ordering the record of the case subject thereof remanded to the court of ori-
gin for further proceedings.[10]

Aggrieved by the reversal of the RTC, herein respondent filed a petition before the Court
of Appeals seeking to set aside the RTC Judgment. On 9 February 2005, the appellate court ren-
dered the herein assailed Decision, to wit:

After thoroughly reviewing through the record, We find nothing that would show that
the spouses Manacnes were ever amenable to any compromise with respondent Pang-et. Thus,
We are at a loss as to the basis of the Arbitration Award sought to be enforced by respondent
Pang-ets subsequent action before the MCTC.
 There is no dispute that the proceeding in Civil Case No. 83 was suspended and the same
remanded to the Lupon on account of the Agreement to Arbitrate which was allegedly not
signed by the parties but agreed upon by their respective counsels during the pre-trial confer-
ence. In the meeting before the Lupon, it would seem that the agreement to arbitrate was not
signed by the spouses Manacnes. More importantly, when the pangkat chairman asked the
spouses Manacnes to sign or affix their thumbmarks in the agreement, they refused and in-
sisted that the case should instead go to court. Thus, the Lupon had no other recourse but to is-
sue a certificate to file action. Unfortunately, the case was again remanded to the Lupon to ren-
der an arbitration award.This time, the Lupon heard the voice tape of the late Beket Padonay af-
firming respondent Pang-ets right to the disputed property. While Pang-et offered to
pay P8,000.00 for the improvements made by the spouses Manacnes, the latter refused to ac-
cept the same and insisted on their right to the subject property. Despite this, the Lupon
on May 10, 1995 issued an Arbitration award which favored respondent Pang-et.

From the time the case was first referred to the Lupon to the time the same was again
remanded to it, the Spouses Manacnes remained firm in not entering into any compromise with
respondent Pang-et. This was made clear in both the minutes of the Arbitration Hearing on 26
February 1995 and on 9 April 1995. With the foregoing, We find it evident that the
spouses Manacnes never intended to submit the case for arbitration.

Moreover, the award itself is riddled with flaws. First of all there is no showing that
the Pangkat ng Tagapagkasundo was duly constituted in accordance with Rule V of the Katarun-
ganPambarangay Rules. And after constituting of the Pangkat, Rule VI, thereof the Punong Bar-
angay and the Pangkat must proceed to hear the case. However, according to the minutes of the
hearing before the lupon on 9 April 1995, the pangkat Chairman and another pangkat member
were absent for the hearing.

Finally, Section 13 of the same Rule requires that the Punong Barangay or the Pan-
gkat Chairman should attest that parties freely and voluntarily agreed to the settlement arrived
at. But how can this be possible when the minutes of the two hearings show that the
spouses Manacnes neither freely nor voluntarily agreed to anything.

While RA 7160 and the Katarungan Pambarangay rules provide for a period to repudiate
the Arbitration Award, the same is neither applicable nor necessary since the Agreement to Ar-
bitrate or the Arbitration Award were never freely nor voluntarily entered into by one of the
parties to the dispute. In short, there is no agreement validly concluded that needs to be repudi-
ated.

With all the foregoing, estoppel may not be applied against petitioners for an action or
defense against a null and void act does not prescribe. With this, We cannot but agree with the
MCTC that the very agreement to arbitrate is null and void. Similarly, the arbitration award
which was but the off shoot of the agreement is also void.
 WHEREFORE, the RTC judgment of 2 June 2003 is REVERSED and SET ASIDE, the MCTC
Resolution DISMISSING the Civil Case No. 118 for enforcement of Arbitration Award is REIN-
STATED.[11]

Vehemently disagreeing with the Decision of the Court of Appeals, petitioner Pang-et
filed the instant petition. Petitioner maintains that the appellate court overlooked material facts
that resulted in reversible errors in the assailed Decision. According to petitioner, the Court of
Appeals overlooked the fact that the original parties, as represented by their respective coun-
sels in Civil Case No. 83, mutually agreed to submit the case for arbitration by the Lupon ng Ta-
gapamayapa of Barangay Dagdag. Petitioner insists that the parties must be bound by the initial
agreement by their counsels during pre-trial to an amicable settlement as any representation
made by the lawyers are deemed made with the conformity of their clients. Furthermore, peti-
tioner maintains that if indeed the spouses Manacnes did not want to enter into an amicable
settlement, then they should have raised their opposition at the first instance, which was at the
pre-trial on Civil Case No. 83 when the MCTC ordered that the case be remanded to the Lupon
ng Tagapamayapa for arbitration.

We do not agree with the petitioner.

First and foremost, in order to resolve the case before us, it is pivotal to stress that, dur-
ing the initial hearing before the Lupon ng Tagapamayapa, the spouses Manacnesdeclined to
sign the Agreement for Arbitration and were adamant that the proceedings before the MCTC in
Civil Case No. 83 must continue. As reflected in the Minutes[12] of the Arbitration Hearing held
on 26 February 1995, the legality of the signature of Catherine Manacnes, daughter of the Man-
acnes spouses, who signed the Agreement for Arbitration on behalf of her parents, was assailed
on the ground that it should be the spouses Manacnes themselves who should have signed such
agreement. To resolve the issue, the Pangkat Chairman then asked the spouses Manacnes that
if they wanted the arbitration proceedings to continue, they must signify their intention in the
Agreement for Arbitration form. However, as stated earlier, the Manacnes spouses did not want
to sign such agreement and instead insisted that the case go to court.
 Consequently, the Lupon issued a Certification to File Action on 26 February 1995 due to
the refusal of the Manacnes spouses. Indicated in said Certification are the following: 1) that
there was personal confrontation between the parties before the Punong Barangay but concilia-
tion failed and 2) that the Pangkat ng Tagapagkasundo was constituted but the personal con-
frontation before the Pangkat failed likewise because respondents do not want to submit this
case for arbitration and insist that said case will go to court.[13] Nevertheless, upon receipt of
said certification and the records of the case, the MCTC ordered that the case be remanded to
the Lupon ng Tagapamayapa and for the latter to render an arbitration award, explaining that:

Going over the documents submitted to the court by the office of the Lupon Tagapa-
mayapa of Dagdag, Sagada, Mountain Province, the court observed that an Agreement for Arbi-
tration was executed by the parties anent the above-entitled case. However, said Lupon did not
make any arbitration award as mandated by the Katarungang Pambarangay Law but instead
made a finding that the case may now be brought to the court. This is violative of the KP Law,
which cannot be sanctioned by the court.[14]

At this juncture, it must be stressed that the object of the Katarungang Pambaran-
gay Law is the amicable settlement of disputes through conciliation proceedings voluntarily and
freely entered into by the parties.[15] Through this mechanism, the parties are encouraged to
settle their disputes without enduring the rigors of court litigation.Nonetheless, the disputing
parties are not compelled to settle their controversy during the barangay proceedings before
the Lupon or the Pangkat, as they are free to instead find recourse in the courts[16] in the event
that no true compromise is reached.

The key in achieving the objectives of an effective amicable settlement under the Katar-
ungang Pambarangay Law is the free and voluntary agreement of the parties to submit the dis-
pute for adjudication either by the Lupon or the Pangkat, whose award or decision shall be bind-
ing upon them with the force and effect of a final judgment of a court.[17] Absent this voluntary
submission by the parties to submit their dispute to arbitration under the Katarungang Pambar-
angay Law, there cannot be a binding settlement arrived at effectively resolving the
case. Hence, we fail to see why the MCTC further remanded the case to the Lupon ng Tagapa-
mayapa and insisted that the arbitration proceedings continue, despite the clear showing that
the spouses Manacnes refused to submit the controversy for arbitration.
 It would seem from the Order of the MCTC, which again remanded the case for arbitra-
tion to the Lupon ng Tagapamayapa, that it is compulsory on the part of the parties to submit
the case for arbitration until an arbitration award is rendered by the Lupon. This, to our minds,
is contrary to the very nature of the proceedings under the KatarungangPambaran-
gay Law which espouses the principle of voluntary acquiescence of the disputing parties to ami-
cable settlement.

What is compulsory under the Katarungang Pambarangay Law is that there be a con-
frontation between the parties before the Lupon Chairman or the Pangkat and that a certifica-
tion be issued that no conciliation or settlement has been reached, as attested to by the Lu-
pon or Pangkat Chairman, before a case falling within the authority of the Lupon may be insti-
tuted in court or any other government office for adjudication. [18] In other words, the only
necessary pre-condition before any case falling within the authority of the Lupon or the Pan-
gkat may be filed before a court is that there has been personal confrontation between the par-
ties but despite earnest efforts to conciliate, there was a failure to amicably settle the dispute. It
should be emphasized that while the spouses Manacnes appeared before the Lupon during the
initial hearing for the conciliation proceedings, they refused to sign the Agreement for Arbitra-
tion form, which would have signified their consent to submit the case for arbitration. There-
fore, upon certification by the Lupon ng Tagapamayapa that the confrontation before
the Pangkat failed because the spouses Manacnes refused to submit the case for arbitration
and insisted that the case should go to court, the MCTC should have continued with the pro-
ceedings in the case for recovery of possession which it suspended in order to give way for
the possible amicable resolution of the case through arbitration before the Lupon ng Tagapa-
mayapa.
 Petitioners assertion that the parties must be bound by their respective counsels agree-
ment to submit the case for arbitration and thereafter enter into an amicable settlement is im-
precise. What was agreed to by the parties respective counsels was the remand of the case to
the Lupon ng Tagapamayapa for conciliation proceedings and not the actual amicable settle-
ment of the case. As stated earlier, the parties may only be compelled to appear before the Lu-
pon ng Tagapamayapa for the necessary confrontation, but not to enter into any amicable set-
tlement, or in the case at bar, to sign the Agreement for Arbitration. Thus, when the Mana-
cnes spouses personally appeared during the initial hearing before the Lupon ng Tagapamaya-
pa, they had already complied with the agreement during the pre-trial to submit the case for
conciliation proceedings. Their presence during said hearing is already their acquiescence to the
order of the MCTC remanding the case to the Lupon for conciliation proceedings, as there has
been an actual confrontation between the parties despite the fact that no amicable settlement
was reached due to the spouses Manacnes refusal to sign the Agreement for Arbitration.

Furthermore, the MCTC should not have persisted in ordering the Lupon ng Tagapa-
mayapa to render an arbitration award upon the refusal of the spouses Manacnes to submit the
case for arbitration since such arbitration award will not bind the spouses. As reflected in Sec-
tion 413 of the Revised Katarungang Pambarangay Law, in order that a party may be bound by
an arbitration award, said party must have agreed in writing that they shall abide by the arbitra-
tion award of the Lupon or the Pangkat. Like in any other contract, parties who have not signed
an agreement to arbitrate will not be bound by said agreement since it is axiomatic that a con-
tract cannot be binding upon and cannot be enforced against one who is not a party to it.[19] In
view of the fact that upon verification by the Pangkat Chairman, in order to settle the issue of
whether or not they intend to submit the matter for arbitration, the spouses Manacnes refused
to affix their signature or thumb mark on the Agreement for Arbitration Form, the Mana-
cnes spouses cannot be bound by the Agreement for Arbitration and the ensuing arbitration
award since they never became privy to any agreement submitting the case for arbitration by
the Pangkat.
 WHEREFORE, premises considered, the instant petition is hereby DENIED. The Decision
of the Court of Appeals in CA-G.R. SP No. 78019 is hereby AFFIRMED.The Municipal Circuit Trial
Court of Besao-Sagada, Mountain Province, is hereby ORDERED to proceed with the trial of Civil
Case No. 83 for Recovery of Possession of Real Property, and the immediate resolution of the
same with deliberate dispatch. No costs.

SO ORDERED.