Republic of the Philippines of law contained in the decision of the Metropolitan Trial Court of Makati, Metro
SUPREME COURT Manila, Branch 63 and finds that there is no cogent reason to disturb the same.
Manila
EN BANC
G.R. No. 81006 May 12, 1989
VICTORINO C. FRANCISCO, petitioner,
vs.
WINAI PERMSKUL and THE HON. COURT OF APPEALS, respondents.
CRUZ, J.:
An important constitutional question has been injected in this case which started out as an
ordinary complaint for a sum of money. The question squarely presented to the Court is the
validity of the memorandum decision authorized under Section 40 of B.P. Blg. 129 in the light of
Article VIII, Section 14 of the Constitution.
On May 21, 1984, the petitioner leased his apartment in Makati to the private respondent for a
period of one year for the stipulated rental of P3,000.00 a month. Pursuant to the lease contract,
the private respondent deposited with the petitioner the amount of P9,000.00 to answer for unpaid
rentals or any damage to the leased premises except when caused by reasonable wear and tear.
On May 31, 1985, the private respondent vacated the property. He thereafter requested the refund
of his deposit minus the sum of P1,000.00, representing the rental for the additional ten days of
his occupancy after the expiration of the lease. The petitioner rejected this request. He said the
lessee still owed him for other charges, including the electricity and water bills and the sum of
P2,500.00 for repainting of the leased premises to restore them to their original condition.1
The private respondent sued in the Metropolitan Trial Court of Makati. After the submission of
position papers by the parties, a summary judgment was rendered on October 11, 1985,
sustaining the complainant and holding that the repainting was not chargeable to him. The
defendant was ordered to pay the plaintiff the amount of P7,750.00, representing the balance of
the deposit after deducting the water and electricity charges. The plaintiff was also awarded the
sum of P1,250.00 as attorney's fees, plus the Costs.2
This decision was appealed to the Regional Trial Court of Makati and was affirmed by Judge Jose
C. de la Rama on January 14, 1987. This was done in a memorandum decision reading in full as
follows:
MEMORANDUM DECISION
After a careful and thorough perusal, evaluation and study of the records of this
case, this Court hereby adopts by reference the findings of fact and conclusions
WHEREFORE, judgment appealed from is hereby affirmed in toto.3
When the defendant went to the Court of Appeals, his petition for review was denied on
September 29, 1987, as so too was his motion for reconsideration, on December 1, 1987. 4 He is
now before us to fault the respondent court, principally for sustaining the memorandum decision of
the regional trial court. His contention is that it violates Article VIII, Section 14 of the Constitution.
This provision reads as follows:
Sec. 14. No decision shall be rendered by any court without expressing therein
clearly and distinctly the facts and the law on which it is based.
No petition for review or motion for reconsideration of a decision of the court shall
be refused due course or denied without stating the legal basis therefor.
Except for the second paragraph, which was introduced only in the present charter, Section 14
has been in force since the Constitution of 1935. The provision was recast in affirmative terms in
the 1973 Constitution but has been virtually restored to its original form in the Constitution of 1987,
to apply to all courts, including the municipal courts. The purpose has always been the same, viz.,
to inform the person reading the decision, and especially the parties, of how it was reached by the
court after consideration of the pertinent facts and examination of the applicable laws.
The parties are entitled to no less than this explanation if only to assure them that the court
rendering the decision actually studied the case before pronouncing its judgment. But there are
more substantial reasons. For one thing, the losing party must be given an opportunity to analyze
the decision so that, if permitted, he may elevate what he may consider its errors for review by a
higher tribunal. For another, the decision, if well-presented and reasoned, may convince the losing
party of its merits and persuade it to accept the verdict in good grace instead of prolonging the
litigation with a useless appeal. A third reason is that decisions with a full exposition of the facts
and the law on which they are based, especially those coming from the Supreme Court, will
constitute a valuable body of case law that can serve as useful references and even as
precedents in the resolution of future controversies. As the Court said in Rosales v. Court of First
Instance. 5
Precedents are helpful in deciding cases when they are on all fours or at least
substantially Identical with previous litigations. Argumentum a simili valet in
lege. Earlier decisions are guideposts that can lead us in the right direction as we
tread the highways and byways of the law in the search for truth and justice.
These pronouncements represent the wisdom of the past. They are the voice of
vanished judges talking to the future. Except where there is a need to reverse
them because of an emergent viewpoint or an altered situation, they urge us
strongly that, indeed, the trodden path is best.
According to the petitioner, the memorandum decision rendered by the regional trial court should
be revoked for non-compliance with the above-quoted constitutional mandate. He asks that the
case be remanded to the regional trial court for a full blown hearing on the merits, to be followed
by a decision stating therein clearly and distinctly the facts and the law on which it is based. For
his part, the private respondent demurs. He justifies the memorandum decision as authorized by
B.P. Blg. 129 and invokes the ruling of this Court in Romero v. Court of Appeals, 6 Which
sustained the said law.
Section 40 of B.P. Blg. 129 reads as follows:
Sec. 40. Form of decision in appealed cases. — Every decision or final resolution
of a court in appealed cases shall clearly and distinctly state the findings of fact
and the conclusions of law on which it is based which may be contained in the
decision or final resolution itself, or adopted by reference from those set forth in
the decision, order or resolution appealed from.
The above section was applied in the Romero case, together with a similar rule embodied in
Section 18 of P.D. No. 946, providing that:
All cases of the Court of Agrarian Relations now pending before the Court of
Appeals shall remain in the Division to which they have been assigned, and shall
be decided within sixty (60) days from the effectivity of this Decree; Provided,
however, That if the decision or order be an affirmance in toto of the dispositive
conclusion of the judgment appealed from, then the Court of Appeals may,
instead of rendering an extended opinion, indicate clearly the trial court's findings
of fact and pronouncements of law which have been adopted as basis for the
affirmance.
In the said case, Justice Jose Y. Feria, speaking for a unanimous Court, declared:
As previously stated, the decision of the Court of Agrarian Relations consisted of
thirteen pages, single space. The above-quoted decision of the respondent Court
of Appeals consists of four pages, three of which contains verbatim the
dispositive portion of the decision appealed from. The remaining page is devoted
to an explanation of why "for judicial convenience and expediency, therefore, We
hereby adopt, by way of reference, the findings of facts and conclusions of the
court a quo spread in its decision, as integral part of this Our decision." The said
decision may be considered as substantial compliance with the above-quoted
provisions in Section 18 of P.D. No. 946 and Section 40 of B.P. Blg. 129.
Nevertheless, he was quick to add a tenable misgiving and to express the following reservation:
The authority given the appellate court to adopt by reference the findings of fact
and conclusions of law from those set forth in the appealed decisions should be
exercised with caution and prudence, because the tendency would be to follow
the line of least resistance by just adopting the findings and conclusions of the
lower court without thoroughly studying the appealed case.
This caveat was necessary because, as he correctly observed:
It cannot be too strongly emphasized that just as important as the intrinsic validity
of a decision is the perception by the parties-litigants that they have been
accorded a fair opportunity to be heard by a fair and responsible magistrate
before judgment is rendered. It is this perception, coupled with a clear
conscience, which enables the members of the judiciary to discharge the
awesome responsibility of sitting in judgment on their fellowmen.
There is no question that the purpose of the law in authorizing the memorandum decision is to
expedite the termination of litigations for the benefit of the parties as well as the courts
themselves.
Concerned with the mounting problem of delay in the administration of justice, the Constitution
now contains a number of provisions aimed at correcting this serious difficulty that has caused
much disaffection among the people. Thus, Section 16 of the Bill of Rights reiterates the original
provision in the 1973 Constitution guaranteeing to all persons "the right to a speedy disposition of
their cases before all judicial, quasi-judicial or administrative bodies." Section 14(2) of the same
Article III retains the rule that the accused shall be entitled to a trial that shall not only be public
and impartial but also speedy. In Article VIII, Section 5(3), the Supreme Court is expressly
permitted to temporarily assign a judge from one station to another when the public interest so
requires, as when there is a necessity for less occupied judge to help a busier colleague dispose
of his cases. In paragraph 5 of the same section, it is stressed that the rules of court to be
promulgated by the Supreme Court "shall provide a simplified and inexpensive procedure for the
speedy disposition of cases." In Section 15, of the same article, maximum periods are prescribed
for the decision or resolution of cases, to wit, twenty-four months in the case of Supreme Court
and, unless reduced by the Supreme Court, twelve months for all lower collegiate courts and three
months for all other lower courts.
The courts of justice are really hard put at coping with the tremendous number of cases in their
dockets which, to make matters worse, continues to grow by the day despite the efforts being
taken to reduce it. In the Supreme Court alone, an average of 400 cases is received every month
as against the average of 300 cases disposed of during the same month, leaving a difference of
100 cases monthly that is added to some 5,000 still unresolved cases that have accumulated
during the last two decades or so. At this rate, the backlog will increase by 1,200 cases every year
on top of the earlier balance, much of which, despite its age, is still viable and have still to be
resolved. Considering that the Court spends four days of the week for studying and deliberating on
these cases in its en banc and division sessions, one can appreciate the limited time allowed its
members for the actual writing of its decisions. (This particular decision, while extended, happens
fortunately to be less complicated than many of the other cases submitted to it, which require more
time to write, not to mention the antecedent research that may have to be made.)
Viewed in the light of these practical considerations, the memorandum decision can be welcomed
indeed as an acceptable method of dealing expeditiously with the case load of the courts of
justice, But expediency alone, no matter how compelling, cannot excuse non-compliance with the
Constitution; or to put it more familiarly, the end does not justify the means. It is plain that if
Section 40 of B.P. Blg. 129 is unconstitutional, it must be struck down.
In the case at bar, we find that a judgment was made by the metropolitan trial court in compliance
with the rule on summary procedure. The decision consisted of three typewritten pages, single
space, and stated clearly and distinctly the facts and the law on which it was based. It was a
concise and well-written decision, and a correct one to boot, for which Judge Paciano B. Balita is
to be commended.
The problem, though, as the petitioner sees it, is that in affirming this judgment, the regional trial
court of Makati rendered a mere memorandum decision that simply adopted by reference the
findings of fact and law made by Judge Balita and then concluded, without saying more, that
"there was no cogent reason to disturb the same." It is claimed that as Judge de la Rama did not
make his own statement of the facts and the law as required by the Constitution, his memorandum
decision was a total nullity. Worse, when the appeal was taken to the respondent court, what it
reviewed was not the memorandum decision of the regional trial court but the decision rendered
by the metropolitan trial court which, legally speaking, was not before the appellate court.
It is not really correct to say that the Court of Appeals did not review the memorandum decision of
the regional trial court which was the subject of the petition for review. A reading of its own
decision will show that it dealt extensively with the memorandum decision and discussed it at
some length in the light of the observations — and reservations — of this Court in
the Romero case. Moreover, in reviewing the decision of the metropolitan trial court, the Court of
Appeals was actually reviewing the decision of the regional trial court, which had incorporated by
reference the earlier decision rendered by Judge Balita.
The question, of course, is whether such incorporation by reference was a valid act that effectively
elevated the decision of the metropolitan trial court for examination by the Court of Appeals.
To be fair, let it be said that when Judge dela Rama availed himself of the convenience offered by
Section 40 of B.P. Blg. 129, he was only acting in accordance with the ruling announced
in Romero permitting the use of the memorandum decision. It must also be observed that even if
the respondent court appeared to be partial to the reservation rather than the rule in the said case,
it nevertheless had the duty — which it discharged — to abide by the doctrine announced therein
by the highest tribunal of the land. The respondent court could not have acted otherwise.
This Court is not hampered by such inhibitions. As we may re-examine our own rulings and modify
or reverse them whenever warranted, we take a second look at the memorandum decision and
the Romero case and test them on the touchstone of the Constitution.
The law does not define the memorandum decision and simply suggests that the court may adopt
by reference the findings of fact and the conclusions of law stated in the decision, order or
resolution on appeal before it. No particular form is prescribed; the conditions for its use are not
indicated. In fact, B.P. Blg. 129 does not even employ the term "memorandum decision" in Section
40 or elsewhere in the rest of the statute. This phrase appears to have been introduced in this
jurisdiction not by that law but by Section 24 of the Interim Rules and Guidelines, reading as
follows:
Sec. 24. Memorandum decisions. — -The judgment or final resolution of a court
in appealed cases may adopt by reference the findings of fact and conclusions of
law contained in the decision or final order appealed from.
It is clear that where the decision of the appellate court actually reproduces the findings of fact or
the conclusions of law of the court below, it is not a memorandum decision as envisioned in the
above provision. The distinctive features of the memorandum decision are, first, it is rendered by
an appellate court, and second, it incorporates by reference the findings of fact or the conclusions
of law contained in the decision, order or ruling under review. Most likely, the purpose is to affirm
the decision, although it is not impossible that the approval of the findings of fact by the lower
court may lead to a different conclusion of law by the higher court. At any rate, the reason for
allowing the incorporation by reference is evidently to avoid the cumbersome reproduction of the
decision of the lower court, or portions thereof, in the decision of the higher court. The Idea is to
avoid having to repeat in the body of the latter decision the findings or conclusions of the lower
court since they are being approved or adopted anyway.
Parenthetically, the memorandum decision is also allowed in the United States, but its form (at
least) differs from the one under consideration in this case. Such a decision is rendered in that
country upon a previous' determination by the judge that there is no need for a published opinion
and that it will have no precedential effect. The judgment is usually limited to the dispositive
portion but a memorandum is attached containing a brief statement of the facts and the law
involved, mainly for the information of the parties to the case.
When a law is questioned before the Court, we employ the presumption in favor of its
constitutionality. As we said in Peralta v. Commission of Elections, "to justify the nullification of a
law, there must be a clear and unequivocal breach of the Constitution, not a doubtful and
argumentative implication."7 Courts will bend over backward to sustain that presumption. In case
of doubt, it is the duty of the judiciary to exert every effort to prevent the invalidation of the law and
the nullification of the will of the legislature that enacted it and the executive that approved it. This
norm is based on a becoming respect that the judiciary is expected to accord the political
departments of the government which, it must be assumed in fairness, thoroughly studied the
measure under challenge and assured themselves of its constitutionality before agreeing to enact
it.
The Court has deliberated extensively on the challenge posed against the memorandum decision
as now authorized by law. Taking into account the salutary purpose for which it is allowed, and
bearing in mind the above-discussed restraint we must observe when a law is challenged before
us, we have come to the conclusion that Section 40 of B.P. Blg. 129, as we shall interpret it here,
is not unconstitutional.
What is questioned about the law is the permission it gives for the appellate court to merely adopt
by reference in its own decision the judgment of the lower court on appeal. It is easy to understand
that this device may feed the suspicion feared by Justice Feria that the court has not given the
appeal the attention it deserved and thus deprived the parties of due process. True or not, this
impression is likely to undermine popular faith in the judiciary as an impartial forum which hears
before it decides and bases its decision on the established facts and the applicable law.
No less objectionable is the inconvenience involved in having to search for the decision referred
to, which, having been incorporated by reference only, does not have to be attached to the
memorandum decision. The Court had occasion earlier to complain about this difficulty in the case
of Gindoy v. Tapucar, 8 where we said:
. . . True it is that the Court of First Instance may adopt in toto either expressly or
impliedly the findings and conclusions of the inferior court, and as a rule, such
adoption would amount to a substantial compliance with the constitutional
mandate discussed herein, but where, as in this case, the specific arguments
presented against the decision of the inferior court are of such nature that a
blanket affirmance of said decision does not in fact adequately dispose of the
strictures against it, it is but proper, if only to facilitate the action to be taken by
the appellate court on the petition for review, that the concrete bases of the
impugned decision should appear on its face, instead of the appellate court
having to dig into the records to find out how the inferior court resolved the issues
of the case.
As to this problem, the Solicitor General correctly points out that it does not exist in the case at bar
because the decision of the Court of Appeals extensively quoted from the decision of the
metropolitan trial court. Although only incorporated by reference in the memorandum decision of
the regional trial court, Judge Balita's decision was nevertheless available to the Court of Appeals.
It is this circumstance, or even happenstance, if you will, that has validated the memorandum
decision challenged in this case and spared it from constitutional infirmity.
That same circumstance is what will move us now to lay down the following requirement, as a
condition for the proper application of Section 40 of B.P. Blg. 129. The memorandum decision, to
be valid, cannot incorporate the findings of fact and the conclusions of law of the lower court only
by remote reference, which is to say that the challenged decision is not easily and immediately
available to the person reading the memorandum decision. For the incorporation by reference to
be allowed, it must provide for direct access to the facts and the law being adopted, which must be
contained in a statement attached to the said decision. In other words, the memorandum decision
authorized under Section 40 of B.P. Blg. 129 should actually embody the findings of fact and
conclusions of law of the lower court in an annex attached to and made an indispensable part of
the decision.
It is expected that this requirement will allay the suspicion that no study was made of the decision
of the lower court and that its decision was merely affirmed without a proper examination of the
facts and the law on which it was based. The proximity at least of the annexed statement should
suggest that such an examination has been undertaken. It is, of course, also understood that the
decision being adopted should, to begin with, comply with Article VIII, Section 14 as no amount of
incorporation or adoption will rectify its violation.
The Court finds it necessary to emphasize that the memorandum decision should be sparingly
used lest it become an addictive excuse for judicial sloth. It is an additional condition for its validity
that this kind of decision may be resorted to only in cases where the facts are in the main
accepted by both parties or easily determinable by the judge and there are no doctrinal
complications involved that will require an extended discussion of the laws involved. The
memorandum decision may be employed in simple litigations only, such as ordinary collection
cases, where the appeal is obviously groundless and deserves no more than the time needed to
dismiss it.
Despite the convenience afforded by the memorandum decision, it is still desirable that the
appellate judge exert some effort in restating in his own words the findings of fact of the lower
court and presenting his own interpretation of the law instead of merely parroting the language of
the court a quo as if he cannot do any better. There must be less intellectual indolence and more
pride of authorship in the writing of a decision, especially if it comes from an appellate court.
It ill becomes an appellate judge to write his rulings with a pair of scissors and a pot of paste as if
he were a mere researcher. He is an innovator, not an echo. The case usually becomes
progressively simpler as it passes through the various levels of appeal and many issues become
unimportant or moot and drop along the way. The appellate judge should prune the cluttered
record to make the issues clearer. He cannot usually do this by simply mimicking the lower court.
He must use his own perceptiveness in unraveling the rollo and his own discernment in
discovering the law. No less importantly, he must use his own language in laying down his
judgment. And in doing so, he should also guard against torpidity lest his pronouncements excite
no more fascination than a technical tract on the values of horse manure as a fertilizer. A little style
will help liven the opinion trapped in the tortuous lexicon of the law with all its whereases and
wherefores. A judicial decision does not have to be a bore.
The interpretation we make today will not apply retroactively to the memorandum decision
rendered by the regional trial court in the case at bar, or to the decision of the respondent court
such decision on the strength of Romero v. Court of Appeals. As earlier observed, there was
substancial compliance with Section 40 because of the direct availability and actual review of the
decision of Judge Balita incorporated by reference in the memorandum decision of Judge de la
Rama. The memorandum decision as then understood under the Romero decision was a valid act
at the time it was rendered by Judge de la Rama and produced binding legal effect. We also affirm
the finding of the respondent court that the summary judgment without a formal trial was in accord
with the Rule on Summary Procedure and that the award of attorney's fees is not improper.
Henceforth, all memorandum decisions shall comply with the requirements herein set forth both as
to the form prescribed and the occasions when they may be rendered. Any deviation will summon
the strict enforcement of Article VIII, Section 14 of the Constitution and strike down the flawed
judgment as a lawless disobedience.
WHEREFORE, the petition is DENIED, with costs against the petitioner. This decision is
immediately executory. It is so ordered.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 101041 November 13, 1991
HON. JUDGE ADRIANO R. VILLAMOR, petitioner,
vs.
HON. JUDGE BERNARDO LL. SALAS and GEORGE CARLOS, respondents.
G.R. No. 101296 November 13, 1991
HON. JUDGE ADRIANO R. VILLAMOR, petitioner,
vs.
ANTONIO T. GUERRERO and HON. PEARY G. ALEONAR, Presiding Judge of RTC, Branch
21, Region VII, Cebu City, respondents.
Ramon Ve Salazar for petitioner.
Antonio T. Guerrero for private respondent.
Henry R. Savellon for respondent.
GRIÑO-AQUINO, J.:
In 1977, Civil Case No. B-398 (Gloria Naval vs. George Carlos) for recovery of ownership of a
parcel of coconut land was filed and subsequently raffled to the sala of the petitioner, Judge
Adriano Villamor. While the civil case was pending there, respondent Carlos filed Criminal Cases
Nos. N-989, N-990, N-991, N-992 and N-993 for qualified theft against Gloria Naval and her
helpers. The criminal cases were also assigned to the sala of Judge Villamor.
Due to the pendency of Civil Case No. B-398, the criminal cases were temporarily archived.
After trial in Civil Case No. B-398, a decision was rendered in favor of Naval who was declared the
lawful owner and possessor of the disputed land. Carlos was ordered to vacate the land.
Thereafter, respondent Carlos, through counsel, moved to activate the archived criminal cases.
Having declared Naval the lawful owner and possessor of the contested land in Civil Case No. B-
398, Judge Villamor dismissed the criminal cases against her and her co-accused.
Judge Villamor likewise granted execution pending appeal of his decision in Civil Case No. B-398.
This order was challenged by Carlos in the Court of Appeals and in this Court, both without
success.
Afterwards, Carlos filed an administrative case, A.M. No. RTJ-87-105, against Judge Villamor,
charging him with having issued illegal orders and an unjust decision in Civil Case No. B-398. On
November 21, 1988, this Court, in an En Banc resolution, summarily dismissed the administrative
case.
Dissatisfied with the outcome of the administrative case, respondent Carlos filed a civil action for
damages (Civil Case No. CEB-6478) against Judge Villamor for knowingly rendering an unjust
judgment when he dismissed the five (5) criminal cases against Naval, et al.
The summons in Civil Case No. CEB-6478 was served upon Judge Villamor on December 10,
1987. The next day (December 11, 1987), instead of answering the complaint, Judge Villamor
issued in Criminal Cases Nos. N-0989 to 0993 an order of direct contempt against Carlos and his
lawyer. Attorney Antonio T. Guerrero, "for degrading the respect and dignity of the court through
the use of derogatory and contemptous language before the court," and sentenced each of them
to suffer the penalty of imprisonment for five (5) days and to pay a fine of P500.
Carlos immediately filed in this Court a petition for certiorari with a prayer for the issuance of a writ
of preliminary injunction against the Judge (G.R. Nos. 82238-42). We promptly restrained Judge
Villamor from enforcing his Order of Contempt against Carlos and Attorney Guerrero. On
November 13, 1989, we annulled the contempt order. (See pp. 26-34, Rollo of G.R. No. 101041.)
Back to Civil Case No. CEB-6478; Judge Villamor filed a motion to dismiss the complaint for lack
of jurisdiction. The trial court granted the motion. The order of dismissal was affirmed by the Court
of Appeals (CA-G.R. CV No. 20657, June 26, 1990). Carlos appealed to this Court which also
denied the petition. (p. 125, Rollo of G.R. No. 101296.)
Unfazed by these setbacks, Carlos and his counsel, Attorney Antonio Guerrero, filed separate
complaints for damages against Judge Villamor for knowingly rendering an unjust order of
contempt.
Attorney Guerrero's complaint for damages (Civil Case No. CEB-8802) was raffled to Branch 21,
Regional Trial Court, Cebu City, presided over by Judge Peary G. Aleonar. Carlos' complaint for
damages was docketed as Civil Case No. CEB-8823 and raffled to Branch 8, Regional Trial Court
of Cebu City presided over by Judge Bernardo LL. Salas.
On March 30, 1990, Judge Villamor filed a motion to dismiss Civil Case No. CEB-8802 but it was
denied by Judge Aleonar (p. 33, Rollo of G.R. No. 101296).
Hence, this petition for certiorari and prohibition with restraining order docketed as G.R. No.
101296.
On September 19, 1991, this Court issued a temporary restraining order against Judge Aleonar to
stop him from proceeding in Civil Case No. CEB-8802 (pp. 45-46, Rollo of G.R. No. 101296).
On May 20, 1991, a Manifestation was filed by Judge Villamor praying Judge Salas to dismiss
Civil Case No. CEB-8823 but the motion was denied by respondent Judge on July 2, 1991 (pp.
13-16, Rollo of G.R. No. 101041).
Nowhere in this Court's decision annulling Judge Villamor's order of direct contempt (G.R. Nos.
82238-42, November 13, 1989) can there be found a declaration that the erroneous order was
rendered maliciously or with conscious and deliberate intent to commit an injustice. In fact, a
previous order of direct contempt issued by Judge Villamor against Carlos' former counsel was
sustained by this Court (Jaynes C. Abarrientos, et al. vs. Judge Villamor, G.R. No. 82237, June 1,
1988).
At most, the order of direct contempt which we nullified may only be considered an error of
judgment for which Judge Villamor may not be held criminally or civilly liable to the respondents.

Hence, this second petition for certiorari and prohibition with restraining order (G.R. No. 101041).
On August 21, 1991, a Resolution was issued by this Court: 1) temporarily restraining Judge Salas
from further proceeding in Civil Case No. CEB-8823; and 2) granting the petitioner's prayer that
this case be consolidated with G.R. No. 101296 (pp. 37-39, Rollo of G.R. No. 101041).
The sole issue here is: whether or not Judges Aleonar and Salas may take cognizance of the
actions for damages against Judge Villamor for allegedly having rendered an unjust order of direct
contempt against Carlos and Attorney Guerrero which this Court subsequently annulled.
A judge is not liable for an erroneous decision in the absence of malice or wrongful conduct in
rendering it (Barroso vs. Arche, 67 SCRA 161).
WHEREFORE, the consolidated petitions for certiorari are GRANTED, Civil Cases Nos. CEB-
8802 and CEB-8823, respectively, pending in the salas of respondents Judge Peary G. Aleonar
and Judge Bernardo LL. Salas, are hereby dismissed. The temporary restraining orders issued by
this Court in these cases are hereby made permanent. No costs.
SO ORDERED.

The answer is no.

As very aptly held by this Court in a Resolution it issued in connection with a previous case filed by
respondent Carlos against Judge Villamor, over a similar action for "Damages and Attorney's Fees
Arising From Rendering an Unjust Judgment," in dismissing the five (5) criminal cases for qualified
theft which he (respondent Carlos) had filed against Gloria P. Naval and others —

Indeed, no Regional Trial Court can pass upon and scrutinize, and much less declare as
unjust a judgment of another Regional Trial Court and sentence the judge thereof liable
for damages without running afoul with the principle that only the higher appellate courts,
namely, the Court of Appeals and the Supreme Court, are vested with authority to review
and correct errors of the trial courts. (George D. Carlos vs. CA, G.R. No. 95560,
November 5, 1990; p. 125, Rollo of G.R No. 101296.)

To allow respondent Judges Aleonar and Salas to proceed with the trial of the actions for
damages against the petitioner, a co-equal judge of a co-equal court, would in effect permit a court
to review and interfere with the judgment of a co-equal court over which it has no appellate
jurisdiction or power of review. The various branches of a Court of First Instance (now the
Regional Trial Court) being co-equal, may not interfere with each other's cases, judgments and
orders (Parco vs. Court of Appeals, 111 SCRA 262).

This Court has already ruled that only after the Appellate Court, in a final judgment, has found that
a trial judge's errors were committed deliberately and in bad faith may a charge of knowingly
rendering an unjust decision be levelled against the latter (Garcia vs. Alconcel, 111 SCRA 178;
Sta. Maria vs. Ubay, 87 SCRA 179; Gahol vs. Riodique, 64 SCRA 494).
 FIRST DIVISION
[G.R. No. 113006. November 23, 2000]
ONG CHIU KWAN, petitioner, vs. COURT OF APPEALS, and the PEOPLE OF THE
PHILIPPINES, respondents.
DECISION
PARDO, J.:
What is before the Court for consideration is the decision of the Court of Appeals affirming
the conviction of accused Ong Chiu Kwan, for unjust vexation.[1]
On January 31, 1991, Assistant City Prosecutor Andres M. Bayona of Bacolod filed with the
Municipal Trial Court, Bacolod City an information charging petitioner with unjust vexation for
cutting the electric wires, water pipes and telephone lines of Crazy Feet, a business establishment
owned and operated by Mildred Ong.[2]
On April 24, 1990, at around 10:00 in the morning, Ong Chiu Kwan ordered Wilfredo Infante
to relocate the telephone, electric and water lines of Crazy Feet, because said lines posed as a
disturbance.[3] However, Ong Chiu Kwan failed to present a permit from appropriate authorities
allowing him to cut the electric wires, water pipe and telephone lines of the business
establishment.[4]
After due trial, on September 1, 1992, the Municipal Trial Court found Ong Chiu Kwan guilty
of unjust vexation,[5] and sentenced him to imprisonment for twenty days.[6] The court also ordered
him to pay moral damages, finding that the wrongful act of abruptly cutting off the electric, water
pipe and telephone lines of Crazy Feet caused the interruption of its business operations during
peak hours, to the detriment of its owner, Mildred Ong. The trial court also awarded exemplary
damages to complainant as a deterrent to the accused not to follow similar act in the future and to
pay attorneys fees.[7] The trial court disposed of the case as follows:
IN VIEW THEREOF, this Court finds the accused guilty beyond reasonable doubt of the offense of
unjust vexation provided under Article 287 par. 2 of the Revised Penal Code and sentences him to
suffer a penalty of imprisonment of twenty (20) days and to pay private complainant the following:
P10,000.00 - moral damages
P 5,000.00 - exemplary damages
P 5,000.00 - attorneys fees and to pay the cost of this suit.
SO ORDERED.
Bacolod City, Philippines, September 1, 1992.
(SGD.)RAFAEL O. PENUELA
Judge[8]
On appeal to the Regional Trial Court, Bacolod City, the latter court in a decision dated
December 8, 1992, simplistically adopted the decision of the lower court in toto, without stating the
reasons for doing so.[9]
On April 22, 1993, by petition for review, Ong Chiu Kwan elevated the case to the Court of
Appeals.[10] On August 16, 1993, the Court of Appeals promulgated its decision dismissing the
appeal,[11]agreeing with the lower courts finding that petitioner was guilty beyond reasonable doubt
of unjust vexation.
Hence, this petition for review.[12]
The Court notes that in the decision of the Regional Trial Court which the Court of Appeals
affirmed peremptorily without noticing its nullity, the Regional Trial Court merely quoted the
decision of the Municipal Trial Court in full and added two paragraphs, thus:
This Court, in accordance with the rules, required the parties to submit their corresponding
memorandum or brief. The prosecution filed its memorandum, and also with the defense.
After a careful perusal of the record of the case and evaluating the evidence thereto and exhibits
thereof, this Court finds no ground to modify, reverse or alter the above-stated decision and
hereby affirms the decision of the lower court in toto.[13]
The Constitution requires that [N]o decision shall be rendered by any court without
expressing therein clearly and distinctly the facts and the law on which it is based. [14] The 1985
Rules of Criminal Procedure, as amended, provides that [T]he judgment must be written in the
official language, personally and directly prepared by the judge and signed by him and shall
contain clearly and distinctly a statement of the facts proved or admitted by the accused and the
law upon which the judgment is based.[15]
Although a memorandum decision is permitted under certain conditions, it cannot merely
refer to the findings of fact and the conclusions of law of the lower court. The court must make a
full findings of fact and conclusions of law of its own.[16]
Consequently, the decision of the regional trial court is a nullity. Very recently, speaking of a
similarly worded decision of a regional trial court, we said:
[I]t is starkly hallow, otiosely written, vacuous in its content and trite in its form. It achieved nothing
and attempted at nothing, not even at a simple summation of facts which could easily be done. Its
inadequacy speaks for itself.[17]
Judges similarly disposed to pay lip service to their work must rethink their place in the
judiciary or seriously take refresher courses on decision writing. We warn them of stiff sanctions
for such lackadaisical performance.
 Consequently, the case may be remanded to the lower court for compliance with the
constitutional requirement of contents of a decision. However, considering that this case has been
pending for sometime, the ends of justice will be fully served if we review the evidence and decide
the case.
Petitioner admitted having ordered the cutting of the electric, water and telephone lines of
complainants business establishment because these lines crossed his property line. He failed,
however, to show evidence that he had the necessary permit or authorization to relocate the
lines. Also, he timed the interruption of electric, water and telephone services during peak hours of
the operation of business of the complainant. Thus, petitioners act unjustly annoyed or vexed the
complainant. Consequently, petitioner Ong Chiu Kwan is liable for unjust vexation.
Regarding damages, we find the award of moral and exemplary damages and attorneys fees
to be without basis. Moral damages may be recovered if they were the proximate result of
defendants wrongful act or omission.[18] An award of exemplary damages is justified if the crime
was committed with one or more aggravating circumstances.[19] There is no evidence to support
such award.Hence, we delete the award of moral damages, exemplary damages, and attorneys
fees.
WHEREFORE, the decisions of the lower courts are REVERSED and SET ASIDE. In lieu
thereof, accused Ong Chiu Kwan is hereby sentenced to pay a fine of P200.00, and the costs. The
award of moral and exemplary damages and attorneys fees is hereby deleted.
SO ORDERED.
 FIRST DIVISION
G.R. No. 118830 February 24, 2003
SPOUSES ALFREDO AND ENCARNACION CHING, petitioners,
vs.
COURT OF APPEALS, FAMILY SAVINGS BANK, and FERDINAND J. GUERRERO, SENIOR
DEPUTY SHERIFF, MANILA, respondents.
DECISION
AZCUNA, J.:
This petition for review on certiorari, under Rule 45 of the Rules of Court, seeks to set aside the
decision1 of the Court of Appeals in CA G.R. CV No. 31795, dated October 27, 1994, as well as its
resolution,2 dated January 27, 1995, denying petitioners’ motion for reconsideration.
The facts, gathered from the records of the petition, involve three different cases filed in separate
jurisdictions.
On August 6, 1981, respondent Family Savings Bank (Bank) filed a complaint 3 with the Court of
First Instance (CFI) of Manila, for the collection of a sum of money against its debtor Cheng Ban
Yek & Co., Inc. and petitioner Alfredo Ching, who acted as a surety for Cheng Ban Yek & Co.,
Inc.4 A day after the complaint was filed, the Bank was able to obtain a writ of preliminary
attachment against the defendants.5 Armed with a writ of preliminary attachment, the deputy sheriff
of the CFI of Manila, herein respondent Ferdinand J. Guerrero, proceeded to levy upon a conjugal
property6 belonging to petitioners, spouses Alfredo and Encarnacion Ching.7
On July 26, 1982, petitioners filed a petition8 with the CFI of Rizal,9 seeking to declare illegal the
levy on attachment upon their conjugal property.10 Petitioners claimed that the branch sheriff had
no authority to levy upon a property belonging to the conjugal partnership. The trial court,
however, dismissed the case on August 8, 1983 for lack of jurisdiction because the subject
property was already under custodia legis of the CFI of Manila.11
Meanwhile, summary judgment was rendered in the collection case in favor of the Bank on August
12, 1982.12 The defendants therein, including petitioner Alfredo Ching, appealed the summary
judgment to the Court of Appeals.13While the case was on appeal,14 the trial court granted the
Bank’s motion for execution pending appeal.15 As a consequence, the attached conjugal property
was levied upon and sold through public auction by the deputy sheriff to the Bank on October 10,
1983.16
On September 5, 1984, in an effort to prevent the deputy sheriff from consolidating the sale,
petitioners filed a second annulment case17 with the Regional Trial Court (RTC) of
Makati.18 Petitioners sought to declare void the levy and sale on execution of their conjugal
property by reiterating the same argument raised in the first annulment case, i.e., that the branch
sheriff had no authority to levy upon a property belonging to the conjugal partnership.19
On November 15, 1985, while the second annulment case was pending, the Court of Appeals
dismissed the appeal filed in the collection case and affirmed in toto the summary judgment
rendered by the CFI of Manila.20 The matter was elevated to us on a petition for review,21 but was
eventually dismissed for having been filed out of time and for lack of merit. 22 Hence, the decision in
the collection case became final.
On November 13, 1990, the RTC of Makati rendered judgment in the second annulment case in
favor of petitioners and declared null and void the levy and sale on execution upon the conjugal
property.23 Respondents elevated the decision to the Court of Appeals in CA G.R. CV No. 31795.
On October 27, 1994, the Court of Appeals issued the assailed decision, reversing and setting
aside the decision of the RTC of Makati.24 The Court of Appeals declared that the Makati
annulment case is barred by res judicata because of the prior Rizal annulment case and Manila
collection case.1awphi1.nét Hence, this appeal.
Petitioners pray for the reversal of the decision of the Court of Appeals on the following grounds: 25
I
The Court of Appeals erred in holding that the decisions rendered in the Manila collection case
and Rizal annulment case, taken together, constitute res judicata or bar by prior judgment to the
annulment case filed with the RTC of Makati. Assuming there is res judicata or bar by prior
judgment, the Court of Appeals erred in not holding that respondents have waived this defense.
II
The Court of Appeals erred in holding that petitioner Encarnacion Ching waived or abandoned her
right or claim on her conjugal property when she did not intervene in the Manila collection case.
III
In any event, the Court of Appeals erred in not deciding the Makati annulment case on its merits
on equitable considerations.
We deny the petition.
The Makati annulment case should have been dismissed from the start for lack of jurisdiction. The
RTC of Makati does not have the authority to nullify the levy and sale on execution that was
ordered by the CFI of Manila, a co-equal court. The determination of whether or not the levy and
sale of a property in execution of a judgment was valid, properly falls within the jurisdiction of the
court that rendered the judgment and issued the writ of execution.26
Beginning with the case of Orais v. Escaño,27 down to the subsequent cases of Nuñez v.
Low,28 Cabigao v. del Rosario,29 Hubahib v. Insular Drug Co., Inc.,30 National Power Corp. v. De
Veyra,31 Luciano v. Provincial Governor,321a\^/phi1.netDe Leon v. Hon. Judge
Salvador, Cojuangco v. Villegas, Darwin v. Tokonaga,35 we laid down the long standing doctrine
33 34
that no court has the power to interfere by injunction with the judgments or decrees of a court of
concurrent or coordinate jurisdiction. The various trial courts of a province or city, having the same
or equal authority, should not, cannot, and are not permitted to interfere with their respective
cases, much less with their orders or judgments. A contrary rule would obviously lead to confusion
and seriously hamper the administration of justice.
There is no dispute that the subject conjugal property was under custodia legis of the CFI of
Manila. It was initially attached under a writ of preliminary attachment issued by the CFI of Manila.
Said property was later on levied upon and sold under a writ of execution issued by the same
court. Since the attachment, levy and sale have been carried out upon orders of the CFI of Manila,
any and all questions concerning the validity and regularity thereof necessarily had to be
addressed to the CFI of Manila.
Petitioners, however, contend that one of the owners of the property, petitioner Encarnacion
Ching, was not a party to the collection case. Not being a party thereto, Encarnacion Ching should
be allowed to file a separate case as a third-party claimant and said filing cannot be considered as
an encroachment upon the jurisdiction of a co-equal and coordinate court.36
We do not agree.
Section 16 of Rule 39 of the Rules of Court authorizes a third person, who is not the judgment
debtor or his agent, to vindicate his claim to a property levied through an entirely separate and
distinct action. Said rule reads as follows:37
SECTION 16. Proceedings where property claimed by third person. — If the property levied on is
claimed by any person other than the judgment obligor or his agent, and such person makes an
affidavit of his title thereto or right to the possession thereof, stating the grounds of such right or
title, and serves the same upon the officer making the levy and a copy thereof upon the judgment
obligee, the officer shall not be bound to keep the property, unless such judgment obligee, on
demand of the officer, files a bond approved by the court to indemnify the third-party claimant in a
sum not less than the value of the property levied on. In case of disagreement as to such value,
the same shall be determined by the court issuing the writ of execution. No claim for damages for
the taking or keeping of the property may be enforced against the bond unless the action therefor
is filed within one hundred twenty (120) days from the date of the filing of the bond.
The officer shall not be liable for damages for the taking or keeping of the property, to any third-
party claimant if such bond is filed. Nothing herein contained shall prevent such claimant or any
third person from vindicating his claim to the property in a separate action, or prevent the judgment
obligee from claiming damages in the same or separate action against a third-party claimant who
filed a frivolous or plainly spurious claim.
xxxxxxxxx
In Ong v. Tating,38 we elucidated on the applicability of Section 16 of Rule 39 of the Rules of Court.
We held therein that a separate and distinct case from that in which the execution has issued is
proper if instituted by a "stranger" to the latter suit. Upon the other hand, if the claim of impropriety
on the part of the sheriff in the execution proceedings is made by a party to the action, not a
stranger thereto, any relief therefrom may only be applied with, and obtained from, the executing
court. This is true even if a new party has been impleaded in the suit.
Is a spouse, who was not a party to the suit but whose conjugal property is being executed on
account of the other spouse being the judgment obligor, considered a "stranger?" In Mariano v.
Court of Appeals,39 we answered this question in the negative. In that case, the CFI of Caloocan
City declared the wife to be the judgment obligor and, consequently, a writ of execution was
issued against her. Thereupon, the sheriff proceeded to levy upon the conjugal properties of the
wife and her husband. The wife initially filed a petition for certiorari with the Court of Appeals
praying for the annulment of the writ of execution. However, the petition was adjudged to be
without merit and was accordingly dismissed. The husband then filed a complaint with the CFI of
Quezon City for the annulment of the writ of execution, alleging therein that the conjugal properties
cannot be made to answer for obligations exclusively contracted by the wife. The executing party
moved to dismiss the annulment case, but the motion was denied. On appeal, the Court of
Appeals, in Mariano, ruled that the CFI of Quezon City, in continuing to hear the annulment case,
had not interfered with the executing court. We reversed the Court of Appeals’ ruling and held that
there was interference by the CFI of Quezon City with the execution of the CFI of Caloocan City.
We ruled that the husband of the judgment debtor cannot be deemed a "stranger" to the case
prosecuted and adjudged against his wife, which would allow the filing of a separate and
independent action.
The facts of the Mariano case are similar to this case. Clearly, it was inappropriate for petitioners
to institute a separate case for annulment when they could have easily questioned the execution
of their conjugal property in the collection case. We note in fact that the trial court in the Rizal
annulment case specifically informed petitioners that Encarnacion Ching’s rights could be
ventilated in the Manila collection case by the mere expedient of intervening therein. 40 Apparently,
petitioners ignored the trial court’s advice, as Encarnacion Ching did not intervene therein and
petitioners instituted another annulment case after their conjugal property was levied upon and
sold on execution.
There have been instances where we ruled that a spouse may file a separate case against a
wrongful execution.41However, in those cases, we allowed the institution of a separate and
independent action because what were executed upon were the paraphernal or exclusive property
of a spouse who was not a party to the case. In those instances, said spouse can truly be deemed
a "stranger." In the present case, the levy and sale on execution was made upon the conjugal
property.
In any case, even without the intervention of Encarnacion Ching in the collection case, it appears
that Alfredo Ching was able to raise the conjugal nature of the property in both the trial court and
appellate court. A perusal of the records reveals that petitioner Alfredo Ching filed a Motion for
Reconsideration and to Quash Writ of Execution before the CFI of Manila. In the motion, he
specifically argued that the execution was invalid for having been enforced upon their conjugal
property.42 Alfredo Ching raised this argument again on appeal in CA G.R. CV No.
02421.43 Evidently, due process has been afforded to petitioners as regards the execution on their
conjugal property.
Considering that that the RTC of Makati did not have jurisdiction to hear Civil Case No. 8389, it
becomes unnecessary to resolve the other issues raised by petitioners.
WHEREFORE, the petition for review is DENIED. The assailed decision and resolution of the
Court of Appeals are hereby AFFIRMED. Costs against petitioners.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
SECOND DIVISION
G.R. No. 145022 September 23, 2005
ARMAND NOCUM and THE PHILIPPINE DAILY INQUIRER, INC., Petitioners,
vs.
vs.
LUCIO TAN, Respondent.
DECISION
CHICO-NAZARIO, J.:
Assailed in a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil
Procedure are the decision1 of the Court of Appeals dated 19 April 2000 that affirmed the
order of the Regional Trial Court (RTC) of Makati City, Branch 56, in Civil Case No. 98-2288,
dated 19 April 1999, admitting respondent Lucio Tan’s Amended Complaint for Damages
for the alleged malicious and defamatory imputations against him in two (2) articles of the
Philippine Daily Inquirer, and its Resolution2 dated 15 September 2000 denying petitioners
Armand Nocum and The Philippine Daily Inquirer, Inc.’s motion for reconsideration.
The antecedents are summarized by the Court of Appeals.
On September 27, 1998, Lucio Tan filed a complaint against reporter Armand Nocum, Capt.
Florendo Umali, ALPAP and Inquirer with the Regional Trial Court of Makati, docketed
as Civil Case No. 98-2288, seeking moral and exemplary damages for the alleged malicious
and defamatory imputations contained in a news article.
INQUIRER and NOCUM filed their joint answer, dated October 27, 1998, wherein they
alleged that: (1) the complaint failed to state a cause of action; (2) the defamatory
statements alleged in the complaint were general conclusions without factual premises; (3)
the questioned news report constituted fair and true report on the matters of public interest
concerning a public figure and therefore, was privileged in nature; and (4) malice on their
part was negated by the publication in the same article of plaintiff’s or PAL’s side of the
dispute with the pilot’s union.
ALPAP and UMALI likewise filed their joint answer, dated October 31, 1998, and alleged
therein that: (1) the complaint stated no cause of action; (2) venue was improperly laid; and
(3) plaintiff Lucio Tan was not a real party in interest. It appeared that the complaint failed
to state the residence of the complainant at the time of the alleged commission of the
offense and the place where the libelous article was printed and first published.
Thus, the Regional Trial Court of Makati issued an Order dated February 10, 1999,
dismissing the complaint without prejudice on the ground of improper venue.
Aggrieved by the dismissal of the complaint, respondent Lucio Tan filed an Omnibus
Motion dated February 24, 1999, seeking reconsideration of the dismissal and admission of
the amended complaint. In par. 2.01.1of the amended complaint, it is alleged that "This
article was printed and first published in the City of Makati" (p. 53, Rollo, CA-G.R. SP No.
55192), and in par. 2.04.1, that "This caricature was printed and first published in the City of
Makati" (p. 55, id.).
The lower court, after having the case dismissed for improper venue, admitted the
amended complaint and deemed set aside the previous order of dismissal, supra,
stating, inter alia, that:
"The mistake or deficiency in the original complaint appears now to have been cured in the
Amended Complaint which can still be properly admitted, pursuant to Rule 10 of the 1997
Rules of Civil Procedure, inasmuch as the Order of dismissal is not yet final. Besides, there
is no substantial amendment in the Amended Complaint which would affect the
defendants’ defenses and their Answers. The Amendment is merely formal, contrary to the
contention of the defendants that it is substantial."
Dissatisfied, petitioners, together with defendants Capt. Florendo Umali and the Airline
Pilots Association of the Philippines, Inc. (ALPAP), appealed the RTC decision to the Court
of Appeals. Two petitions for certiorari were filed, one filed by petitioners which was
docketed as CA-G.R. SP No. 55192, and the other by defendants Umali and ALPAP which
was docketed as CA-G.R. SP No. 54894. The two petitions were consolidated.
On 19 April 2000, the Court of Appeals rendered its decision the dispositive portion of
which reads:
WHEREFORE, premises considered, the petition is hereby DENIED DUE COURSE and
DISMISSED for lack of merit. The Order of the court a quo is hereby AFFIRMED.
The motions for reconsideration filed by petitioners and by defendants Umali and ALPAP
were likewise denied in a resolution dated 15 September 2000.
Both petitioners and defendants Umali and ALPAP appealed to this Court. Under
consideration is the petition for review filed by petitioners.
On 11 December 2000, the Court required respondent Tan to comment on the petition filed
by petitioners.3
Respondent filed his comment on 22 January 20014 to which petitioners filed a reply on 26
April 2001.5
In a Manifestation filed on 19 February 2001, respondent stated that the petition6 filed by
defendants Umali and ALPAP has already been denied by the Court in a resolution dated 17
January 2001.7
On 20 August 2003, the Court resolved to give due course to the petition and required the
parties to submit their respective memoranda within thirty (30) days from notice. 8 Both
petitioners and respondent complied.9
Petitioners assigned the following as errors:
A. THE COURT OF APPEALS ERRED IN RULING (1) THAT THE LOWER COURT HAD
JURISDICTION OVER THE CASE (ON THE BASIS OF THE ORIGINAL COMPLAINT)
NOTWITHSTANDING THE FACT THAT THE LOWER COURT HAD EARLIER DISMISSED THE
ORIGINAL COMPLAINT FOR ITS FAILURE TO CONFER JURISDICTION UPON THJE
COURT; AND (2) THAT THE AMENDED COMPLAINT WAS PROPERLY ALLOWED OR
ADMITTED BECAUSE THE LOWER COURT WAS "NEVER DIVESTED" OF JURISDICTION
OVER THE CASE;
B. THE COURT OF APPEALS ERRED IN NOT RULING THAT THE ORIGINAL COMPLAINT
OF RESPONDENT WAS AMENDED PURPOSELY TO CONFER UPON THE LOWER COURT
JURISDICTION OVER THE CASE.10
Petitioners state that Article 360 of the Revised Penal Code vests jurisdiction over all civil
and criminal complaints for libel on the RTC of the place: (1) where the libelous article was
printed and first published; or (2) where the complainant, if a private person, resides; or (3)
where the complainant, if a public official, holds office. They argue that since the original
complaint only contained the office address of respondent and not the latter’s actual
residence or the place where the allegedly offending news reports were printed and first
published, the original complaint, by reason of the deficiencies in its allegations, failed to
confer jurisdiction on the lower court.
The question to be resolved is: Did the lower court acquire jurisdiction over the civil case
upon the filing of the original complaint for damages?
We rule in the affirmative.
It is settled that jurisdiction is conferred by law based on the facts alleged in the
complaint since the latter comprises a concise statement of the ultimate facts constituting
the plaintiff's causes of action.11 In the case at bar, after examining the original complaint,
we find that the RTC acquired jurisdiction over the case when the case was filed before it.
From the allegations thereof, respondent’s cause of action is for damages arising from
libel, the jurisdiction of which is vested with the RTC. Article 360 of the Revised Penal Code
provides that it is a Court of First Instance12 that is specifically designated to try a libel
case.13
Petitioners are confusing jurisdiction with venue. A former colleague, the Hon. Florenz D.
Regalado,14differentiated jurisdiction and venue as follows: (a) Jurisdiction is the authority
to hear and determine a case; venue is the place where the case is to be heard or tried; (b)
Jurisdiction is a matter of substantive law; venue, of procedural law; (c) Jurisdiction
establishes a relation between the court and the subject matter; venue, a relation between
plaintiff and defendant, or petitioner and respondent; and, (d) Jurisdiction is fixed by law
and cannot be conferred by the parties; venue may be conferred by the act or agreement of
the parties.
In the case at bar, the additional allegations in the Amended Complaint that the article and
the caricature were printed and first published in the City of Makati referred only to the
question of venue and not jurisdiction. These additional allegations would neither confer
jurisdiction on the RTC nor would respondent’s failure to include the same in the original
complaint divest the lower court of its jurisdiction over the case. Respondent’s failure to
allege these allegations gave the lower court the power, upon motion by a party, to dismiss
the complaint on the ground that venue was not properly laid.
In Laquian v. Baltazar,15 this Court construed the term "jurisdiction" in Article 360 of the
Revised Penal Code as referring to the place where actions for libel shall be filed or
"venue."
In Escribano v. Avila,16 pursuant to Republic Act No. 4363,17 we laid down the following
rules on the venue of the criminal and civil actions in written defamations.
1. General rule: The action may be filed in the Court of First Instance of the province or city
where the libelous article is printed and first published or where any of the offended parties
actually resides at the time of the commission of the offense.
2. If the offended party is a public officer with office in Manila at the time the offense was
committed, the venue is Manila or the city or province where the libelous article is printed
and first published.
3. Where an offended party is a public official with office outside of Manila, the venue is the
province or the city where he held office at the time of the commission of the offense or
where the libelous article is printed and first published.
4. If an offended party is a private person, the venue is his place of residence at the time of
the commission of the offense or where the libelous article is printed and first published.
The common feature of the foregoing rules is that whether the offended party is a public
officer or a private person, he has always the option to file the action in the Court of First
Instance of the province or city where the libelous article is printed or first published.
We further restated18 the rules on venue in Article 360 as follows:
1. Whether the offended party is a public official or a private person, the criminal action
may be filed in the Court of First Instance of the province or city where the libelous article
is printed and first published.
2. If the offended party is a private individual, the criminal action may also be filed in the
Court of First Instance of the province where he actually resided at the time of the
commission of the offense.
3. If the offended party is a public officer whose office is in Manila at the time of the
commission of the offense, the action may be filed in the Court of First Instance of Manila.
4. If the offended party is a public officer holding office outside of Manila, the action may be
filed in the Court of First Instance of the province or city where he held office at the time of
the commission of the offense.
We fully agree with the Court of Appeals when it ruled:
We note that the amended complaint or amendment to the complaint was not intended to
vest jurisdiction to the lower court, where originally it had none. The amendment was
merely to establish the proper venue for the action. It is a well-established rule that venue
has nothing to do with jurisdiction, except in criminal actions. Assuming that venue were
properly laid in the court where the action was instituted, that would be procedural, not a
jurisdictional impediment. In fact, in civil cases, venue may be waived.
access to the courts as it relates to the place of trial.22 In contrast, in criminal actions, it is
fundamental that venue is jurisdictional it being an essential element of jurisdiction.23
Petitioners’ argument that the lower court has no jurisdiction over the case because
respondent failed to allege the place where the libelous articles were printed and first
published would have been tenable if the case filed were a criminal case. The failure of the
original complaint to contain such information would be fatal because this fact involves the
issue of venue which goes into the territorial jurisdiction of the court. This is not to be
because the case before us is a civil action where venue is not jurisdictional.
The cases24 cited by petitioners are not applicable here. These cases involve amendments
on complaints that confer jurisdiction on courts over which they originally had none. This
is not true in the case at bar. As discussed above, the RTC acquired jurisdiction over the
subject matter upon the filing of the original complaint. It did not lose jurisdiction over the
same when it dismissed it on the ground of improper venue. The amendment merely laid
down the proper venue of the case.
WHEREFORE, the foregoing considered, the decision of the Court of Appeals dated 19
April 2000 is AFFIRMED in toto. No costs.
SO ORDERED.

Consequently, by dismissing the case on the ground of improper venue, the lower court
had jurisdiction over the case. Apparently, the herein petitioners recognized this
jurisdiction by filing their answers to the complaint, albeit, questioning the propriety of
venue, instead of a motion to dismiss.

...

We so hold that dismissal of the complaint by the lower court was proper considering that
the complaint, indeed, on its face, failed to allege neither the residence of the complainant
nor the place where the libelous article was printed and first published. Nevertheless,
before the finality of the dismissal, the same may still be amended as in fact the amended
complaint was admitted, in view of the court a quo’s jurisdiction, of which it was never
divested. In so doing, the court acted properly and without any grave abuse of discretion.19

It is elementary that objections to venue in CIVIL ACTIONS arising from libel may be waived
since they do not involve a question of jurisdiction. The laying of venue is procedural
rather than substantive, relating as it does to jurisdiction of the court over the person
rather than the subject matter. Venue relates to trial and not to jurisdiction. 20 It is a
procedural, not a jurisdictional, matter. It relates to the place of trial or geographical
location in which an action or proceeding should be brought and not to the jurisdiction of
the court.21 It is meant to provide convenience to the parties, rather than restrict their
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 170478 May 22, 2008
SPS. TERESITO Y. VILLACASTIN and LOURDES FUA VILLACASTIN, petitioners,
vs.
PAUL PELAEZ, respondent.
DECISION
TINGA, J.:
A conflict of jurisdiction between the Department of Agrarian Reform Adjudication Board (DARAB)
and the regular trial courts is at the core of the present case. Petitioners question the Decision 1of
the Court of Appeals dated February 7, 2005, in CA-G.R. SP. No. 83873, which upheld the
primary and exclusive jurisdiction of the DARAB in cases involving the use or possession of lands
covered by agrarian laws.
The facts, as culled from the record, are as follows:
On June 29, 1976, respondent Paul Pelaez and his wife mortgaged their agricultural lands bearing
Original Certificates of Title Nos. 0-10343, 0-10344 and 0-10345, situated in Barrio Kodia,
Madridejos, Cebu, to the Development Bank of the Philippines (DBP) Bogo Branch, Cebu. For
failure of the Pelaez spouses to pay their mortgage obligation, the properties were foreclosed and
subsequently sold at public auction.
The purported tenants of the property, Anastacio Alob, Francisco Alob, Jesus Cordova, Manuel
Sanchez, Elia Giltendez, Flora dela Peña, Eliseo Rayco, Benjamin Santillan, Pascual Gilbuena,
Jesus Alob, Renaldo Grande, and Julieto Manzueto, filed an action to annul the mortgage,
foreclosure and sale of the properties, claiming that they are the owners thereof under Presidential
Decree No. 27. the case was docketed as Reg. Case No. VII-76-C-90.
In the meantime, on May 10, 1988, petitioners filed a Complaint for Forcible Entry with Prayer for a
Writ of Preliminary Mandatory Injunction,2 docketed as Civil Case No. 79, with the First Municipal
Circuit Trial Court (MCTC) of Bantayan, Cebu, against respondent and a certain Elesio
Monteseven. The complaint averred that plaintiffs (petitioners herein) are the owners and actual
possessors of the subject landholding and that defendants, having entered the property through
stealth and strategy, unlawfully deprived plaintiffs of possession thereof.
Respondent countered that he is the owner of the subject property, which was foreclosed by the
DBP and later purchased by petitioners at an auction sale. Petitioners, however, were allegedly
never in possession of the subject property as they failed to apply for a writ of possession therefor.
Respondent further claimed that he had redeemed the property on March 3, 1988 and accordingly
reacquired possession thereof.3
Meanwhile, the Provincial Agrarian Reform Adjudicator in Cebu rendered a decision in Reg. Case
No. VII-76-C-90 dated February 15, 1993, in favor of the tenants, the dispositive portion of which
states:
WHEREFORE, in the light of the foregoing view, DECISION is hereby rendered as
follows:
1. Declaring complainants herein with the exception of Silbino Arranquez[,] Jr. and Claro
Gilbuela who earlier withdraw from this case as bonafide tenant farmers of the parcels in
question covered by P.D. [No.] 27;
2. Declaring the mortgage executed by Sps. Paul and Elnora Pelaez to respondent DBP
and the subsequent foreclosure and eventual sale thereof to Sps. Teresito and Lourdes
Villacastin as null and void ab initio as it is contrary to law, public order and public policy;
3. Declaring complainants herein to properly account their deposited shares/lease rentals
before the DAR office of Bantayan[,] Cebu and deliver the said deposited [share/lease]
rentals including the forthcoming harvest thereon to respondent landowners Sps. Paul
and Elnora Pelaez with the assistance of the MARO of Bantayan, Madridejos, Cebu.
4. No pronouncement as to cost.4
This decision was affirmed by the DARAB in a Decision5 dated February 22, 2000.
On January 6, 2000, the MCTC rendered judgment in Civil Case No. 79 in favor of petitioners and
disposed as follows:
WHEREFORE, premises considered, defendant is hereby ordered:
a) To return to plaintiffs possession of the parcel of land above-described and vacate the
premises;
b) To pay the costs of litigation;
c) Moral and exemplary damages not recoverable in ejectment suit is denied;
d) Expenses claimed not duly proven are disallowed;
e) To release in favor of the plaintiffs the cash bond the sum of P5,000.00 deposited
pursuant to the issuance of a Writ of Preliminary Mandatory Injunction.6
In a Decision7 dated March 10, 2004, the Regional Trial Court (RTC) of Dakit, Bogo, Cebu, Branch
61, affirmed the MCTC decision.
The Court of Appeals, however, ruled that regular courts should respect the primary jurisdiction
vested upon the DARAB in cases involving agricultural lands such as the property subject of this
case. Accordingly, it set aside the decision rendered by the RTC and the MCTC, and dismissed
the complaint for forcible entry filed by petitioners in this case.
The appellate court denied reconsideration in its Resolution8 dated November 11, 2005.
Petitioners contend that Civil Case No. 79 did not involve any agrarian matter and thus, the MCTC
correctly exercised jurisdiction over the case.
In his Comment9 dated March 21, 2006, respondent underscores the fact that the parcels of land
subject of this case are tenanted agricultural lands. Before judgment was rendered in the forcible
entry case, the tenants of the property already filed a suit with the DARAB for the annulment of the
real estate mortgage executed by respondent over the same in favor of DBP and the subsequent
foreclosure and auction sale in favor of petitioners. The DARAB's decision declaring the mortgage,
foreclosure and auction sale null and void became final as regards petitioners who did not appeal
from the decision. Respondent asserts that the complaint for forcible entry filed by petitioners had
lost its legal basis after the DARAB declared that the foreclosure and auction sale of the subject
property were null and void.
Petitioners filed a Reply10 dated July 28, 2006, insisting that the tenant-farmers involved in the
DARAB case were not parties to the forcible entry case, the only defendant therein being
respondent in this case. Respondent, in turn, raised the defense of ownership, thereby joining the
issues regarding possession and ownership.
Petitioners further note their argument in their Motion for Reconsideration 11 of the Decision of the
Court of Appeals that the subject property had been declared as wilderness area and the same
had been classified as alienable and disposable on December 22, 1987. In support of this
contention, they submitted a Department of Agrarian Reform Order12 dated September 12, 1997 to
the effect that the subject property falls within the administrative authority or competence of the
Department of Environment and Natural Resources (DENR). The order directed the PARO of
Cebu and the MARO of Bantayan, Cebu to cease and desist from further activities affecting the
subject property under Operation Land Transfer, and to refer the matter to the DENR.
Jurisdiction over the subject matter is determined by the allegations of the complaint.13 In
ascertaining, for instance, whether an action is one for forcible entry falling within the exclusive
jurisdiction of the inferior courts, the averments of the complaint and the character of the relief
sought are to be examined.14
A review of the complaint reveals that the pertinent allegations thereof sufficiently vest jurisdiction
over the action on the MCTC. The complaint alleges as follows:
III
That the plaintiffs are the owners and legal as well as actual possessors of a parcel of
agricultural land more particularly described as follows:
xxx
IV
That the defendant, sometime in the second week of March 1988, by strategy and
through stealth entered the above-described land of the plaintiffs and took possession
thereof; thus, depriving said plaintiffs of the possession thereof;
V
That several demands were made the plaintiffs upon the defendants to restore to them
the possession of the above-described parcel of land; but, defendants refused and still
refuse to restore possession of said property to the plaintiffs;15
It has not escaped our notice that no landowner-tenant vinculum juris or juridical tie was alleged
between petitioners and respondent, let alone that which would characterize the relationship as an
agrarian dispute.16 Rule II of the DARAB Rules17 provides that the DARAB "shall have primary
jurisdiction, both original and appellate, to determine and adjudicate all agrarian disputes, cases,
controversies, and matters or incidents involving the implementation of the Comprehensive
Agrarian Reform Program under Republic Act No. 6657, Executive Order Nos. 229, 228 and 129-
A, Republic Act No, 3844 as amended by Republic Act No. 6389, Presidential Decree No. 27 and
other agrarian laws and their implementing rules and regulations."
Petitioners' action is clearly for the recovery of physical or material possession of the subject
property only, a question which both the MCTC and the RTC ruled petitioners are entitled to. It
does not involve the adjudication of an agrarian reform matter, nor an agrarian dispute falling
within the jurisdiction of the DARAB.
Courts have jurisdiction over possessory actions involving public or private agricultural lands to
determine the issue of physical possession as this issue is independent of the question of
disposition and alienation of such lands which should be threshed out in the DAR.18 Thus,
jurisdiction was rightfully exercised by the MCTC and the RTC.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP.
No. 83873 dated February 7, 2005, and its Resolution dated November 11, 2005, are REVERSED
and SET ASIDE. The Decision of the Regional Trial Court of Dakit, Bogo, Cebu, Branch 61, dated
March 10, 2004, affirming the decision of the Municipal Circuit Trial Court of Bantayan, Cebu,
dated June 6, 2000, is REINSTATED. No pronouncement as to costs.
SO ORDERED.
 FIRST DIVISION
[G.R. No. 92625 : December 26, 1990.]
192 SCRA 768
JOSE ORDA and IMELDA LOZADA, Petitioners, vs. THE HONORABLE COURT OF
APPEALS and GIL GALANG Respondents.
DECISION
GANCAYCO, J.:
The question presented in this case is whether or not the Court of Appeals may refer a petition for
habeas corpus originally filed with it to the Regional Trial Court for a full-blown trial due to
conflicting facts presented by the parties.
Originally, private respondent filed a petition for habeas corpus with the Regional Trial Court of
San Pablo City to regain custody of his minor daughter, Joyce, who continued staying with her
maternal grandparents, petitioners herein, her mother being already deceased at the initiation of
the action. The case was eventually dismissed for lack of jurisdiction because petitioners, as
defendants therein, had moved to Bataan and any writ of habeas corpus to be issued by the trial
court may not be enforced against them.
Subsequently, private respondent, on the basis of his being the sole surviving parent of his
daughter, filed a petition for habeas corpus with the respondent Court of Appeals docketed as CA-
G.R. No. 13912-SP, an original action to compel petitioners to produce the body of minor Joyce
Orda Galang and explain the basis of their custody. Petitioners herein filed their
Opposition/Answer 1 alleging that private respondent abandoned his wife and child, had no source
of livelihood and therefore could not support his daughter, they prayed that care and custody of
the child be awarded them.: rd
On 13 April 1988, respondent court issued its assailed decision, as follows:
The conflicting thesis (sic), however, of petitioner [private respondent herein] and
respondents [petitioners herein] require a full-blown trial of the facts alleged by the
parties. This could be shown by the initial discussions aforestated.
The records show that [private respondent] had already filed a similar petition before the
Regional Trial Court, Fourth Judicial Region, Branch 31, San Pablo City, on November
23, 1987, in Special Proceedings No. SP-719 (87). However, the writ was returned
unserved as [petitioners] ostensibly transferred their domicile at the Philippine Refugee
Processing Center at Barrio Sabang, Morong, Bataan.
Inasmuch as [petitioners] have submitted to the jurisdiction of the Court by producing the
body of the child, Joyce Orda Galang, and submitted their comments to the petition, the
trial on the merits could now proceed to determine who of the parties are entitled to the
custody of the child.
WHEREFORE, premises considered, this Court hereby decides to REMAND this case to
the Regional Trial Court, Branch 31, San Pablo City, for trial on the merits as to which of
the parties are legally entitled to the custody of the child, Joyce Orda Galang.
SO ORDERED. 2
In conformity with the foregoing decision the Regional Trial Court of San Pablo City, the Hon.
Napoleon R. Flojo presiding, before which private respondent filed his first action, ordered the
reinstatement of Special Proceedings No. SP-719 (87) and scheduled the case for trial on the
merits. 3 Upon examination of the records of said case, petitioners noted that only the order of
dismissal of the same was in the expediente of the case. They brought this matter to the attention
of the trial court which then issued an order dated 27 January 1989 directing the Chief, Archives
Section of the Court of Appeals "to transmit to this Court the original record of case AC-G.R. No.
SP-13912 (sic) immediately upon receipt of this Order." 4
In reply, the respondent Court of Appeals advised the trial court that no records can be remanded
because no expediente from the lower court was ever elevated. For this reason, petitioners filed
with respondent court on 21 April 1989 a Motion for Clarification of its earlier decision alleging that
CA-G.R. No. SP-13912 was an original action, not an appeal emanating from, or a special civil
action to assail, a case filed with the trial court, hence no record of the case can be remanded
because no expediente from the lower court was ever elevated to the Court of Appeals; that
Special Proceedings No. SP-719 (87) was dismissed for lack of jurisdiction and the order of
dismissal has long become final and, moreover, herein petitioners were never brought to the
jurisdiction of the trial court in said special proceedings, so much so that they have not even
presented an answer or opposition in said special proceedings; and that a reinstatement of
Special Proceedings No. SP-719 (87), over which the trial court had lost jurisdiction, may not be
justified by virtue of the order of the Court of Appeals to remand CA-G.R. No. 13912 for trial on the
merits. 5
The Court of Appeals 6 resolved this motion on 6 June 1989 as follows:
At the outset, it is necessary to point out that this Court entertained this petition for Habeas Corpus
in the exercise of its original jurisdiction over such case. Said petition is in no way connected with
the one dismissed by the lower court in SP-719 (87).
In their Motion for Clarification, [petitioners] appear to be confused by this Court's directive
remanding the case to the lower court.
It should be noted that when this Court ordered the same, it did not mean the remanding of the
records, but (the) referring (of) the case to the court a quo for appropriate action, it enjoying
original and concurrent jurisdiction with this Court over habeas corpus cases (B.P. 129).:-cralaw
Judge Napoleon Flojo also appears to be mixed up as he issued an Order dated January 27,
1989, which inter alia require the Chief, Archives Section of this Court "to transmit" to the Regional
Trial Court "the original record of case AC-G.R. No. 13912 immediately upon receipt of this order."
(p. 106, Rollo) (sic) But no records can be transmitted back to the lower court simply because no
records were elevated in that, as aforesaid, the case was filed here as an original action.
The [petitioners] have manifested in their motion that they were not given an opportunity to answer
or at least comment on the petition. Now the same is in the lower court as directed in the decision
sought to be clarified. Indeed, issues cannot be joined if the lower court will deprive the
[petitioners] (of) their right to respond to the petition.
 WHEREFORE, for the sake of clarity the dispositive portion of the decision dated April 13,
1988 is hereby MODIFIED to read as follows:
"WHEREFORE, premises considered, this Court hereby decides to REFER this
case to the Regional Trial Court, Branch 31, San Pablo City, for trial on the
merits as to which of the parties are legally entitled to the custody of the child,
Joyce Orda Galang. FOR ISSUES TO BE JOINED, THE LOWER COURT IS
HEREBY ORDERED TO REQUIRE THE [petitioners] TO ANSWER THE
PETITION."
SO ORDERED." 7
Both parties filed separate motions for reconsideration of the foregoing resolution. Petitioners
contended that respondent Court of Appeals had no authority to refer the case to the lower court
for trial on the merits because said court, in the original habeas corpus case filed by private
respondent, had never acquired jurisdiction over their persons. Further, that respondent court had
no power to order a case docketed with the lower court without private respondent having paid the
docketing fee and filing an appropriate pleading therein. Private respondent, on the other hand,
also set forth similar contentions and prayed that trial on the merits be resumed by respondent
Court.
The Court of Appeals 8 resolved both motions for reconsideration on 13 March 1990 as follows:
We entertain no doubt that [petitioners] had never been brought to the jurisdiction of the
lower court in SP: PROC. No. SP-719 (87)and agree with the claim that the Order of
dismissal issued in said case had already become final and executory. But then, it must
be pointed out again that with the filing of another petition for habeas corpus before this
Court (docketed as AC [sic] G.R. SP No. 13912), an entirely new proceeding was
commenced. Unlike the lower court in the previous habeas corpus case, this Court
acquired jurisdiction over the persons of [petitioners] upon their filing of an
Opposition/Answer on April 4, 1988 (p. 14, Rollo).
Section 9[1] in relation to Section 21 of Batas Pambansa Blg. 129 confers upon the Court of
Appeals authority to try and decide habeas corpus cases concurrent with the Regional Trial
Courts. Concurrent or coordinate jurisdiction has been defined as that which is possessed by a
court together with another or others over the same subject matter. Clearly, therefore, Batas
Pambansa Blg. 129 provides the basis for Us to refer AC (sic) G.R. SP No. 13912 to the lower
court for trial on the merits. With the referral of AC (sic) G.R. SP No. 13912, the jurisdiction which
this Court acquired over the persons of [petitioners] was transferred to and conferred upon the
Regional Trial Court, which necessarily must treat said case as a separate and distinct proceeding
from the one it earlier dismissed. This means that the Regional Trial Court must assign the
referred case a new number, but need not require the [private respondent] to remit the prescribed
docketing fee inasmuch as the same had already been paid with this Court. What the parties need
to do though is to reproduce the pleadings they filed in AC (sic) G.R. SP No. 13912 before the
Regional Trial Court in order for issues to be joined therein.- nad
Accordingly, the dispositive portion of the Decision dated April 13, 1988 is hereby further clarified
to read thus:
"WHEREFORE, premises considered, this Court hereby decides to REFER this case to
the regional Trial Court, Branch 31, San Pablo City, for trial on the merits as to which of
the parties are legally entitled to the custody of the child, Joyce Orda Galang. FOR THIS
PURPOSE, THE PARTIES ARE DIRECTED TO REPRODUCE ALL THE PLEADINGS
THEY FILED IN AC (sic) G.R. SP NO. 13912 BEFORE THE REGIONAL TRIAL COURT,
UPON THE RECEIPT OF WHICH, SHALL ASSIGN THE CASE A NEW NUMBER
WITHOUT REQUIRING [private respondent] TO PAY THE DOCKETING FEE."
SO ORDERED. 9
In this special civil action for Certiorari petitioners assign the following as errors committed by the
Court of Appeals:
1. Respondent Court of Appeals erred, as it is without authority [to do so], in referring the
original action for habeas corpus filed before it to the Regional Trial Court, Branch 31,
San Pablo City, for trial on the merits to determine the issue as to which of the parties
are legally entitled to the custody of the child, its reliance on Section 9[1] in relation to
Section 21 of B.P. Blg. 21 being specious.
2. Respondent Court of Appeals erred in ordering the parties to the original action for
habeas corpus filed before it to reproduce before the Regional Trial Court all the
pleadings they filed in AC-G.R. SP No. 13912 (sic).
3. Respondent Court of Appeals erred, as it is without authority [to do so], in directing the
Regional Trial Court, Branch 31, San Pablo City, to assign the case a new case
number without requiring herein private respondent (as petitioner therein) to pay the
docket fee therefor. 10
There is merit in the contentions of petitioners.
Essentially, petitioners argue that the Court of Appeals has no power to issue the decision
remanding the proceedings to the trial court and the two subsequent resolutions clarifying the
same.
The assailed decision and the two resolutions of the Court of Appeals are not supported by law
and the Rules of Court. The provisions of the Judiciary Reorganization Act (B.P. Blg. 129) cited by
the respondent Court of Appeals in its resolution dated 13 March 1990 are not in point. Sections
9(1) and 21 thereof merely provide that the Court of Appeals and Regional Trial Courts,
respectively, exercise original jurisdiction to issue writs of habeas corpus, among others. While
recognizing the concurrent original jurisdiction of both courts over habeas corpus cases as special
proceedings, these provisions are not authority for remanding or referring to the latter original
actions filed with the former.
On the contrary, the Court of Appeals is specifically given the power to receive evidence and
perform any and all acts necessary to resolve factual issues raised in cases falling within its
original jurisdiction. 11 Furthermore, under the Supreme Court Resolution dated 11 February 1983
implementing B.P. Blg. 129 pending the corresponding thorough revision of the Rules of Court, the
Court of Appeals is authorized to conduct a trial or hearing to receive evidence and for the
purpose shall observe the procedure prescribed for the trial courts. 12 Clearly, the Court of
Appeals should not have remanded or referred the petition for a writ of habeas corpus to the trial
court.: nad
Finally, the questioned decision and resolutions go against the Revised Internal Rules of the Court
of Appeals. 13 Under Rule 6, Section 2(c) (5) thereof, the proper procedure is as follows:
RULE 6
 PROCEDURE IN SPECIAL CASES

xxx
SEC. 2. Special Civil Action. — Original verified petitions for Certiorari, prohibition,
mandamus, habeas corpus, quo warranto and other writs may be filed in the Court of
Appeals . . .
xxx
c. Judicial Action. — The Court may either deny due course or dismiss the petition
outright, or require the private respondent or respondents to comment on the petition, or
give due course thereto.
xxx
(5) If it appears that there is need for reception of evidence, the Division to which the
Justice to whom the case is assigned for study and report belongs shall conduct the
hearing. The Division shall have the power to perform any acts to resolve the factual
issues raised in the case (Emphasis supplied.)
Attention is also directed to the fact that the foregoing provision is silent as to whether or not the
hearing may be delegated, unlike that of the provision on annulment of judgments, Section 1(c)(3)
of the same Rule, where, on motion of the parties, referral of any of the issues to a Commissioner
is allowed in accordance with Rule 33 of the Rules of Court.
Under the foregoing disquisition, the Court of Appeals was in error in ordering the remand and
later on the referral of the original petition for habeas corpus filed with it to the Regional Trial
Court. What respondent court should have done was to conduct the reception of evidence and
pass upon the merits of the conflicting allegations of the parties insofar as the petition for a writ of
habeas corpus is concerned.
While We agree with the conclusion reached by respondent court that the case requires a full-
blown trial of the facts, the same should be done in the context of the special proceedings for
custody of minors under Rule 99 of the Rules of Court, and not a remand or referral of the original
action for a writ of habeas corpus filed with the respondent court. Parenthetically, the proper
venue in this action is the place where the petitioner therein resides. 14 Petitioners' third assigned
error is disposed of accordingly.
WHEREFORE, the petition for Certiorari is hereby GRANTED. The assailed decision and
resolutions of the respondent Court of Appeals are SET ASIDE and a new one is rendered
DISMISSING the petition for habeas corpus WITHOUT PREJUDICE to the filing by private
respondent of the appropriate special proceedings to gain custody of his minor child. Let copies of
this decision be furnished all Members of the respondent Court of Appeals. No costs.
SO ORDERED
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 101428 August 5, 1992
DR. ISABELITA VITAL-GOZON, in her official capacity as MEDICAL CENTER CHIEF OF THE
NATIONAL CHILDREN'S HOSPITAL, petitioner,
vs.
THE HONORABLE COURT OF APPEALS and DR. ALEJANDRO S. DE LA
FUENTE, respondents.
Gregorio San Agustin for private respondent.
NARVASA, C.J.:
Whether or not the Court of Appeals has jurisdiction, in a special civil action of mandamus against
a public officer, to take cognizance of the matter of damages sought to be recovered from the
defendant officer, is the chief issue raised in the certiorari action at bar. Also put the issue is
whether or not the Solicitor General may represent the defendant public officer in
the mandamus suit, in so far as the claim for damages is concerned, in light of the Court's rulings
in Urbano , et al. v. Chavez, et al., and Co v. Regional Trial Court of Pasig, et al. 1
There is no dispute about the facts from which these issues arise.
In the early months of 1987 — and pursuant to Executive Order No. 119 issued on January 30,
1987 by President Corazon Aquino — reorganization of the various offices of the Ministry of
Health commenced; existing offices were abolished, transfers of personnel effected.
At the time of the reorganization, Dr. Alejandro S. de la Fuente was the Chief of the Clinics of the
National Children's Hospital, having been appointed to that position on December 20, 1978. Prior
thereto, he occupied the post of Medical Specialist II, a position to which he was promoted in 1977
after serving as Medical Specialist I of the same hospital for six (6) years (since 1971).
On February 4, 1988 Dr. de la Fuente received notice from the Department of Health that he
would be re-appointed "Medical Specialist II." Considering this is to be a demotion by no less than
two ranks from his post as Chief of Clinics, Dr. de la Fuente filed a protest with the DOH
Reorganization Board. When his protest was ignored, he brought his case to the Civil Service
Commission where it was docketed as CSC Case No. 4. In the meantime "the duties and
responsibilities pertaining to the position of Chief of Clinics were turned over to and were allowed
to be exercised by Dr. Jose D. Merencilla,
Jr." 2
Dr. de la Fuente's case was decided by the Civil Service Commission in a Resolution dated
August 9, 1988. In that Resolution, the Commission made the following conclusion and
disposition, to wit:
. . (The Commission) declares the demotion/transfer of appellant de la Fuente,
Jr. from Chief of Clinics to Medical Specialists II as null and void: hence, illegal.
Considering further that since the National Children's Hospital was not abolished
and the position therein remained intact although the title or the position of Chief
of Clinics was changed to "Chief of Medical Professional Staff" with substantially
the same functions and responsibilities, the Commission hereby orders that:
1. Appellant de la Fuente, Jr. be retained or considering as never having
relinquished his position of Chief of Clinics (now Chief of Medical Professional
Staff) without loss of seniority rights; and
2. He be paid back salaries, transportation, representation and housing
allowances and such other benefits withheld from him from the date of his illegal
demotion/transfer.
No motion for reconsideration of this Resolution was ever submitted nor appeal therefrom essayed
to the Supreme Court, within the thirty-day period prescribed therefor by the
Constitution. 3 Consequently, the resolution became final, on September 21, 1988.
De la Fuente thereupon sent two (2) letters to Dr. Vital-Gozon, the Medical Center Chief of
National Children's Hospital, 4 demanding the implementation of the Commission's decision. Dr.
Vital-Gozon referred "de la Fuente's claims to the Department of Health Assistant Secretary for
Legal Affairs for appropriate advice and/or action . . (She did this allegedly because, according to
the Solicitor General, she was) unaware when and how a CSC Resolution becomes final and
executory, whether such Resolution had in fact become final and executory and whether the DOH
Legal Department would officially assail the mentioned Resolution." 5 But she did not answer Dr.
de la Fuente's letters, not even to inform him of the referral thereof to the Assistant Secretary. She
chose simply to await "legal guidance from the DOH Legal Department." On the other hand, no
one in the DOH Legal Department bothered to reply to Dr. de la Fuente, or to take steps to comply
or otherwise advise compliance, with the final and executory Resolution of the Civil Service
Commission. In fact, de la Fuente claims that Vital-Gozon had "actually threatened to stop paying .
. . (his) salary and allowances on the pretext that he has as yet no 'approved' appointment even as
'Medical Specialist II' . . . 6
Three months having elapsed without any word from Vital-Gozon or anyone in her behalf, or any
indication whatever that the CSC Resolution of August 9, 1988 would be obeyed, and
apprehensive that the funds to cover the salaries and allowances otherwise due him would revert
to the General Fund, Dr. de al Fuente repaired to the Civil Service Commission and asked it to
enforce its judgment. He was however "told to file in court a petition
for mandamus because of the belief that the Commission had no coercive powers — unlike a
court — to enforce its final decisions/resolutions. 7
So he instituted in the Court of Appeals on December 28, 1988 an action of "mandamus and
damages with preliminary injunction" to compel Vital-Gozon, and the Administrative Officer,
Budget Officer and Cashier of the NCH to comply with the final and executory resolution of the
Civil Service Commission. He prayed for the following specific reliefs:
(1) (That) . . a temporary restraining order be issued immediately, ordering the
principal and other respondents to revert the funds the of the NCH corresponding
to the amounts necessary to implement the final resolution of the CSC in CSC
Case No. 4 in favor of herein petitioner, Dr. Alejandro S. de la Fuente, Jr., and to
pay such sums which have accrued and due and payable as of the date of said
order;
(2) After hearing on the prayer for preliminary injunction, that the restraining order
be converted to a writ of preliminary injunction; and that a writ of preliminary
mandatory injunction be issued ordering principal respondent and the other
respondents to implement in full the said final resolution; and
(3) That, after hearing on the merits of the petition, that judgment be rendered
seeking (sic) permanent writs issued and that principal respondent be ordered
and commanded to comply with and implement the said final resolution without
further delay; and, furthermore, that the principal respondent be ordered to pay to
the sums of P100,000.00 and P20,000.00 as moral and exemplary damages,
and P10,000.00 for litigation expenses and attorney's fees.
xxx xxx xxx
The Court of Appeals required the respondents to answer. It also issued a temporary restraining
order as prayed for, and required the respondent to show cause why it should not be converted to
a writ of preliminary injunction. The record shows that the respondents prayed for and were
granted an extension of fifteen (15) days to file their answer "through counsel, who," as the Court
of Appeals was later to point out, 8 "did not bother to indicate his address, thus notice was sent to
him through the individual respondents. . . . (However, no) answer was filed; neither was there any
show cause (sic) against a writ of preliminary injunction." It was a certain Atty. Jose Fabia who
appeared in Vital-Gozon's behalf. 9
About a month afterwards, de la Fuente filed with the same Court a "Supplemental/Amended
Petition" dated February 2, 1989. The second petition described as one for "quo warranto" aside
from "mandamus", added three respondents including Dr. Jose Merencilla, Jr.; and alleged inter
alia that he (de la Fuente) had "clear title" to the position in question in virtue of the final and
executory judgment of the Civil Service Commission; that even after the Commission's judgment
had become final and executory and been communicated to Vital-Gozon, the latter allowed "Dr.
Merencilla, Jr. as 'OIC Professional Service' to further usurp, intrude into and unlawfully hold and
exercise the public office/position of petitioner, (under a duly approved permanent appointment as
'Chief of Clinics' since 1978). De la Fuente thus prayed, additionally, for judgment:
(a) Declaring that principal respondent Dr. Jose D. Merencilla, Jr. is not legally
entitled to the office of "Chief of Clinics" (now retitled/known as "Chief of Medical
Professional Staff," NCH), ousting him therefrom and ordering said respondent to
immediately cease and desist from further performing as "OIC Professional
Service" any and all duties and responsibilities of the said office; (and)
(b) Declaring that the petitioner, Dr. Alejandro S. de la Fuente, Jr., is the lawful
or de jure Chief of Clinics (now known as "Chief of the Medical Professional
Staff") and placing him in the possession of said office/position, without the need
of reappointment or new appointment as held by the Civil Service Commission in
its resolution of August 9, 1988, in CSC Case No. 4.
xxx xxx xxx
Copy of the "Supplemental/Amended Petition" was sent to Atty. Jose A. Fabia, Counsel for
Respondents c/o Dr. Ma. Isabelita Vital-Gozon, etc., National Children's Hospital, E. Rodriguez
Ave., Quezon City (Atty. Fabia's address not being indicated or mentioned in his motion for
Extension of
Time). 10
Again the Court of Appeals required answer of the respondents. Again, none was filed. The
petitions were consequently "resolved on the basis of their allegations and the annexes." The
Appellate Court promulgated its judgment on June 9, 1989. 11 It held that —
The question of whether petitioner may be divested of his position as Chief of
Clinics by the expedient of having him appointed to another, lower position is no
longer an issue. It ceased to be such when the resolution in CSC Case No. 4
became final. The said resolution is explicit in its mandate; petitioner was
declared the lawful and de jure Chief of Clinics (Chief of the Medical Professional
Staff) of the National Children's Hospital, and by this token, respondent Dr. Jose
D. Merencilla, Jr. is not legally entitled to the office. Respondents, particularly Dr.
Isabelita Vital-Gozon, had no discretion or choice on the matter; the resolution
had to be complied with. It was ill-advised of principal respondent, and violative
of the rule of law, that the resolution has not been obeyed or implemented.
and accordingly ordered —
. . . respondents, particularly Dr. Isabelita Vital-Gozon, . . . to forthwith comply
with, obey and implement the resolution CSC Case No. 4 (and) . . . Dr. Jose D.
Merencilla, Jr., who is not entitled to the office, . . . to immediately cease and
desist from further performing and acting as OIC Professional Service.
But de la Fuente's prayer for damages — founded essentially on the refusal of Gozon, et al. to
obey the final and executory judgment of the Civil Service Commission, which thus compelled him
to litigate anew in a different forum — was denied by the Court of Appeals on the ground that the
"petitions (for mandamus) are not the vehicle nor is the Court the forum for . . . (said) claim of
damages."
Gozon acknowledged in writing that she received a copy of the Appellate Tribunal's Decision of
June 9, 1989 on June 15, 1989. 12 Respondent de la Fuente acknowledged receipt of his own
copy on June 15, 1989. 13 Neither Vital-Gozon nor her co-party, Dr. Merencilla, Jr., moved for
reconsideration of, or attempted to appeal the decision.
It was de la Fuente who sought reconsideration of the judgment, by motion filed through new
counsel, Atty. Ceferino Gaddi. 14 He insisted that the Appellate Court had competence to award
damages in a mandamus action. He argued that while such a claim for damages might not have
been proper in a mandamus proceeding in the Appellate Court "before the enactment of B.P. Blg.
129 because the Court of Appeals had authority to issue such writs only 'in aid of its appellate
jurisdiction,'" the situation was changed by said BP 129 in virtue of which three levels of courts —
the Supreme Court, the Regional Trial Court, and the Court of Appeals — were conferred
concurrent original jurisdiction to issue said writs, and the Court of Appeals was given power to
conduct hearings and receive evidence to resolve factual issues. To require him to separately
litigate the matter of damages he continued, would lead to that multiplicity of suits which is
abhorred by the law.
While his motion for reconsideration was pending, de la Fuente sought to enforce the judgment of
the Court of Appeals of June 9, 1989 — directing his reinstatement pursuant to the Civil Service
Commission's Resolution of August 9, 1988, supra. He filed on July 4, 1989 a "Motion for
Execution," alleging that the judgment of June 9, 1989 had become final and executory for failure
of Gozon, et al. — served with notice thereof on June 16, 1989 to move for its reconsideration or
elevate the same to the Supreme Court. 15 His motion was granted by the Court of Appeals in a
Resolution dated July 7, 1989, 16 reading as follows:
The decision of June 9, 1989 having become final and executory, as prayed for,
let the writ of execution issue forthwith.
The corresponding writ of execution issued on July 13, 1989, 17 on the invoked authority of Section
9, Rule 39. 18The writ quoted the dispositive portion of the judgment of June 9, 1989, including, as
the Solicitor General's Office points out, the second paragraph to the effect that the petitions "are
not the vehicle nor is the Court the forum for the claim of damages; (hence,) the prayer therefor is
denied."
The writ of execution notwithstanding, compliance with the June 9, 1989 judgment was not
effected. Consequently, de la Fuente filed, on July 20, 1989, an "Urgent Ex Parte Manifestation
with Prayer to Cite Respondents for Contempt," complaining that although Gozon and her co-
parties had been served with the writ of execution on July 14, they had not complied therewith. By
Resolution dated July 26, 1989, the Court required Gozon and Merencilla to appear before it on
August 3, 1989 to answer the charge and show cause "why they should not be adjudged in
contempt for disobeying and/or resisting the judgment." 19
At the hearing Gozon and Merencilla duly presented themselves, accompanied by their individual
private lawyers — one for Gozon (Felipe Hidalgo, Jr.), two for Merencilla (Bernardo S. Nera and
Moises S. Rimando). One other lawyer appeared in their behalf, from the Health Department,
Artemio Manalo, who stated that he was there "in behalf of Jose A. Fabia." 20 They explained that
they had no intention to defy the Court, they had simply referred the matter to their superiors in
good faith; and they were perfectly willing to comply with the judgment, undertaking to do so "even
in the afternoon" of that same day. The Court consequently ordered them "to comply with their
undertaking . . . without any further delay," and report the action taken towards this end, within five
(5) days.
On August 9, 1989, Gozon as "Medical Center Chief," sent a letter to Associate Justice Pedro A.
Ramirez, advising that under Hospital Special Order No. 31 dated August 3, 1989, de la Fuente
had been directed to assume the position of Chief of the Medical Professional Staff, and that a
voucher for the payment of his allowances had been prepared and was being processed. 21
More than a month later, or more precisely on September 27, 1989, the Court of Appeals
promulgated another Resolution, this time resolving de la Fuente's motion for reconsideration of
June 29, 1989. 22 It modified the Decision of June 9, 1989 by (a) deleting its last paragraph
(disallowing the claim of damages, supra), (b) consequently describing and treating it as a
"PARTIAL DECISION," and (c) scheduling "further proceedings for the purpose of receiving
evidence (of damages)," since said question "cannot be resolved by mere reference to the
pleadings." 23This was done in reliance on Section 3, Rule 65 of the Rules of Court, invoked by de
la Fuente, which reads as follows:24
Sec. 3. Mandamus. — When any tribunal, corporation, board, or person
unlawfully neglects the performance of an act which the law specifically enjoins
as a duty resulting from an office, trust, or station, or unlawfully excludes another
from the use and enjoyment of a right or office to which such other is entitled,
and there is no other plain, speedy and adequate remedy in the ordinary course
of law, the person aggrieved thereby may file a verified petition in the proper
court alleging the facts with certainty and praying that judgment be rendered
commanding the defendant, immediately or at some other specified time, to do
the act required to be done to protect the rights of the petitioner, and to pay the
damages sustained by the petitioner by reason of the wrongful acts of the
defendant.
At about this time, yet another lawyer, Atty. Pedro F. Martinez entered his appearance for Isabelita
Gozon. 25 At his instance, the Court gave him an "opportunity to . . . file a motion for
reconsideration" of the Resolution of September 27, 1989. 26 That motion he filed by registered
mail on November 10, 1989. 27 His basic contentions were (a) that the decision of June 9, 1989
could no longer be altered, having become final and executory and having in fact been executed,
and (b) that under BP 129, the Appellate Court had no jurisdiction over the question of damages in
a mandamus action.
The Office of the Solicitor General also put in an appearance in Gozon's behalf at this juncture,
saying that the case had been referred to it only on November 14, 1989. It, too, sought
reconsideration of the Resolution of September 27, 1989. It filed on November 16, 1989 an
"Omnibus Motion; I. For Reconsideration of Resolution dated September 27, 1989; and II. To
defer hearing on petitioner's claims for damages." 28
Both motions were denied by the Court of Appeals in a Resolution dated January 11, 1991. In that
Resolution, the Court —
 1) declared that the amended decision had already become final and could no
longer be re-opened because, although "a copy of the amendatory resolution
was received by counsel who was representing Gozon on October 3, 1989," the
first motion for reconsideration was not mailed until November 10, 1989 and the
Solicitor General's "Omnibus Motion" was not filed until November 16, 1989; and
2) prohibited the Solicitor General from representing Gozon "in connection with . .
. (de la Fuente's) claim for damages," on the authority of this Court's ruling
promulgated on March 19, 1990 in G.R. No. 87977 (Urbano, et al. v. Chavez, et
al.) and G.R. No. 88578 (Co v. Regional Trial Court of Pasig). 29
Notice of this Resolution of January 11, 1991 was served on the Solicitor General's Office on
January 18, 1991. 30Again the Solicitor General sought reconsideration, by motion dated January
25, 1991 and filed on January 30, 1991. 31 Again it was rebuffed. In a Resolution rendered on
August 7, 1991, 32 served on the Solicitor General's Office on August 20, 1991, 33 the Court of
Appeals denied the motion. It ruled that the "question of the authority of the Solicitor General to
appear as counsel for respondent Gozon . . . (had already) been extensively discussed," and that
its "jurisdiction . . . to hear and determine issues on damages proceeds from Sec. 9, Batas
Pambansa 129 as amended."
In an attempt to nullify the adverse dispositions of the Court of
Appeals — and obtain "the ultimate and corollary relief of dismissing respondent de la Fuente's
claim for damages" — the Solicitor General's Office had instituted the special civil action
of certiorari at bar. It contends that the Court of Appeals is not legally competent to take
cognizance of and decide the question of damages in a mandamus suit. It argues that —
1) B.P. Blg. 129 does not confer jurisdiction upon the Court of Appeals to hear, as a trial court,
claims for moral and exemplary damages;
2) assuming that the Court of Appeals does have jurisdiction over the claims for damages, it lost
the power to take cognizance thereof after the Decision of June 9, 1989 had, by its own
pronouncement, become final and executory; and
3) the Urbano and Co doctrines cited by the Appellate Tribunal do not disqualify the Solicitor
General's Office from representing government officials sued in their official capacities and in
damage claims not arising from a felony.
It is in light of these facts, just narrated, that this Court will now proceed to deal with the legal
issues raised in this action. But first, a few brief observations respecting the proceedings in the
Civil Service Commission.
I alleged ground, as de la Fuente claims he was told, that it "had no coercive powers — unlike a
The record demonstrates that Vital-Gozon was fully aware of the following acts and events: 34
1) the proceedings commenced by de la Fuente in the Civil Service Commission in protest against
his demotion;
2) the Commission's Resolution of August 9, 1988 as well, particularly, as the direction therein that
de la Fuente be reinstated and paid all his back salaries and other monetary benefits otherwise
due him, this being couched in fairly simple language obviously understandable to persons of
ordinary or normal intelligence;
3) no less than two (2) written demands of de la Fuente for implementation of the CSC's aforesaid
Resolution of August 9, 1988;
4) the petition filed by de la Fuente in the Court of Appeals for enforcement of the CSC Resolution
of August 9, 1988;
5) the extension granted by said Court of Appeals within which to file answer, notice thereof
having been sent directly to her and her co-respondents since the attorney who sought the
extension in their behalf (Atty. Fabia) did not set out his address in his motion for extension;
6) the "supplemental/amended petition" subsequently presented by de la Fuente, copy of which
was sent to Atty. Fabia, c/o Dr. Vital-Gozon; and
7) the Decision and Amendatory Decision sent to her counsel on October 3, 1989.
To all these, her reaction, and that of the officials of the Department of Health concerned, was a
regrettably cavalier one, to say the least. Neither she nor the Health officials concerned accorded
said acts and events any importance. She never bothered to find out what was being done to
contest or negate de la Fuente's petitions and actions, notwithstanding that as time went by, de la
Fuente's efforts were being met with success.
Nothing in the record even remotely suggests that Vital-Gozon merits relief from the final and
executory Resolution of the Civil Service Commission. This Court will not disturb that Resolution. It
is satisfied that no procedural or substantive errors taint that Resolution, or its becoming final and
executory.
II
Now, final and executory judgments are enforced by writ of execution and not by another,
separate action, whether of mandamus or otherwise. Hence, execution of the Civil Service
Commission's decision of August 9, 1988 should have been ordered and effected by the
Commission itself, when de la Fuente filed a motion therefor. It declined to do so, however, on the
court — to enforce its final decisions/resolutions." 35 That proposition, communicated to de la
Fuente, of the Commission's supposed lack of coercive power to enforce its final judgments, is
incorrect. It is inconsistent with previous acts of the Commission of actually directing execution of
its decisions and resolutions, which this Court has sanctioned in several cases; 36 and it is not in
truth a correct assessment of its powers under the Constitution and the relevant laws.
In an En Banc Decision promulgated on October 15, 1991 in G.R. No. 96938 entitled "Government
Service Insurance System (GSIS) versus Civil Service Commission, et al.," 37 this Court declared
that in light of the pertinent provisions of the Constitution and relevant statutes —
. . . it would appear absurd to deny to the Civil Service Commission the power or
authority to enforce or order execution of its decisions, resolutions or orders
which, it should be stressed, it has been exercising through the years. It would
seem quite obvious that the authority to decide cases in inutile unless
accompanied by the authority to see that what has been decided is carried out.
Hence, the grant to a tribunal or agency of adjudicatory power, or the authority to
hear and adjudge cases, should normally and logically be deemed to include the
grant of authority to enforce or execute the judgments it thus renders, unless the
law otherwise provides.
In any event, the Commission's exercise of that power of execution has been
sanctioned by this Court in several cases.
Be this as it may, the fact is that by reason of the Commission's mistaken refusal to execute its
final and executory Resolution of August 9, 1988, extended proceedings have taken place in the
Court of Appeals and certain issues have been expressly raised in relation thereto, supra. Those
issues appear to the Court to be important enough to deserve serious treatment and resolution,
instead of simply being given short shrift by a terse ruling that the proceedings in the Court Service
Commission actually had the power to execute its final and executory Resolution.
III
The first such issue is whether or not the Court of Appeals has jurisdiction to take cognizance of
the matter of damages in a special civil action of mandamus. The Solicitor General's Office argues
that since jurisdiction is conferred only by law, not by agreement of the parties, or acquiescence of
the court, and since the law conferring jurisdiction on the Court of Appeals, Section 9 of B.P. Blg.
129, makes no reference to "actions for moral and exemplary damages, as those claimed by . . .
(de la Fuente)," it follows that the Court of Appeals has no competence to act on said claim of
damages. And Section 3 of Rule 65, which authorizes the petitioner in a mandamus suit to pray for
judgment commanding the defendant inter alia "to pay the damages sustained by the petitioner by
reason of the wrongful acts of the defendant," is "nothing more than a procedural rule allowing
joinder of causes of action, i.e., mandamus and damages," and such an award of damages is
allowable only in actions commenced in Regional Trial Courts but not in the Court of Appeals or
this Court.
The argument is specious. It cannot be sustained.
The Solicitor General's Office correctly identifies Section 9, B.P. 129 as the legal provision
specifying the original and appellate jurisdiction of the Court of Appeals. The section pertinently
declares that the "Intermediate Appellate Court (now the Court of Appeals) shall exercise . .,"
among others:
. . . Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus, and quo warranto, and auxiliary writs or processes, whether or not in aid
of its appellate jurisdiction . . . 38
The Solicitor General's Office evidently searched said Section 9 for an explicit and specific
statement regarding "actions for moral and exemplary damages," and finding none, concluded that
the Court of Appeals had not been granted competence to assume cognizance of claims for such
damages. The conclusion is incorrect. Section 19, governing the exclusive original jurisdiction of
Regional Trial Courts in civil cases, contains no reference whatever to claims "for moral and
exemplary damages," and indeed does not use the word "damages" at all; yet it is indisputable
that said courts have power to try and decide claims for moral, exemplary and other classes of
damages accompanying any of the types or kinds of cases falling within their specified jurisdiction.
The Solicitor General's theory that the rule in question is a mere procedural one allowing joinder of
an action of mandamus and another for damages, is untenable, for it implies that a claim for
damages arising from the omission or failure to do an act subject of a mandamus suit may be
litigated separately from the latter, the matter of damages not being inextricably linked to the
cause of action for mandamus, which is certainly not the case.
Now, at the time of the enactment of B.P. 129, the issuance of the extraordinary writs above
mentioned was controlled by the Rules of Court of 1964, as they continue to date to be so
controlled. More particularly, the principal writs of mandamus, prohibition and certiorari were (and
continue to be) governed by Rule 65; the writ of habeas corpus, by Rule 102; and the writ of quo
warranto, by Rule 66. The so-called auxiliary writs were (and continue to be) also governed by the
same code — e.g., preliminary attachment, by Rule 57; preliminary injunction, by Rule 58,
receivership, by Rule 59; writ of seizure or delivery in a replevin suit, by Rule 60.
At that time, Section 3 of Rule 65 authorized (as it continues to authorize to date) rendition of
judgment in a mandamus action "commanding the defendant, immediately or at some other
specified time, to do the act required to be done to protect the rights of the petitioner, and to pay
the damages sustained by the petitioner by reason of the wrongful acts of the defendant." 39 The
provision makes plain that the damages are an incident, or the result of, the defendant's wrongful
act in failing and refusing to do the act required to be done. It is noteworthy that the Rules of 1940
had an identical counterpart provision. 40
Moreover, Section 4 of the same Rule 65 authorized, as it continues to authorize to date, the filing
of the petition "in the Supreme Court, or, if it relates to the acts or omissions of an inferior court, or
of a corporation, board, officer or person, in a Court of First Instance (now Regional Trial Court)
having jurisdiction thereof," as well as "in the Court of Appeals (whether or not) 41 in aid of its
appellate jurisdiction."
Worthy of note, too, is that Rule 66 of the Rules of Court similarly authorizes the recovery of
damages in a quo warranto action against a corporate officer — an action within the concurrent
jurisdiction of the Court of Appeals — as follows: 42
Sec. 14. Liability of officer neglecting to deliver property of corporation to
receiver. — An officer of such corporation who refuses or neglects, upon
demand, to deliver over to the receiver all money, property, books, deeds, notes,
 bills, obligations, and papers of every description within his power or control,
belonging to the corporation, or in any wise necessary for the settlement of its
affairs, or the discharge of its debts and liabilities, may be punished for contempt
as having disobeyed a lawful order of the court, and shall be liable to the receiver
for the value of all money or other things so refused or neglected to be
surrendered, together with all damages that may have been sustained by the
stockholders and creditors of the corporation, or any of them, in consequence of
such neglect or refusal.
An award of damages was and is also allowed in connection with the auxiliary writ of preliminary
attachment, preliminary injunction or receivership which the Court of Appeals has the power to
issue in common with the Supreme Court and the Regional Trial Courts, 43 payable by the sureties
of the bond given in support of the writ, upon seasonable application and summary hearing. 44
Since it cannot but be assumed that in formulating, and incorporating in BP 129, the provision
governing the jurisdiction of the Intermediate Appellate Court, now Court of Appeals, the Batasang
Pambansa was fully cognizant of the relevant provisions of the Rules of Court just cited, as well as
the rule against multiplicity of actions, it follows that in conferring on the Court of Appeals original
jurisdiction over the special civil action of mandamus, among others, as well as over the issuance
of auxiliary writs or processes, the Batasang Pambansa clearly intended that said Court should
exercise all the powers then possessed by it under the Rules of Court in relation to said action
of mandamus and auxiliary writs, including the adjudication of damages to the petitioner in the
action in appropriate cases.
IV
The next issue is whether or not the Solicitor General may properly represent a public official like
Dr. Vital-Gozon, who is sued for damages for allegedly refusing to comply with a lawful and
executory judgment of competent authority. The doctrine laid down in the Urbano and Co cases
already adverted to, 45 is quite clear:
. . . (T)he Office of the Solicitor General is not authorized to represent a public
official at any stage of a criminal case. . . .
This observation should apply as well to a public official who is haled to court on
a civil suit for damages arising from a felony allegedly committed by him (Article
100, Revised Penal Code). Any pecuniary liability he may be held to account for
on the occasion of such civil suit is for his own account. The State is not liable for
the same. A fortiori, the Office of the Solicitor General likewise has no authority to
represent him in such a civil suit for damages.
It being quite evident that Dr. Vital-Gozon is not here charged with a crime, or civilly prosecuted for
damages arising from a crime, there is no legal obstacle to her being represented by the Office of
the Solicitor General.
V
The last issue is whether or not the decision of the Court of Appeals of June 9, 1989 could still be
modified after it was pronounced final and executory and was in fact executed with respect to de
la Fuente's reinstatement to his position and the payment of the salaries and allowances due him.
There would seem to be no question about the timeliness of de la Fuente's motion for
reconsideration of the June 9, 1989 decision. As already narrated, notice of said decision was
served on him on the 15th of June, and his motion for reconsideration was presented on June 29,
1989, or fourteen (14) days after receiving a copy of the judgment, i.e., within the fifteen-day
period prescribed by Section 1, Rule 37 of the Rules of Court for filing a motion for new trial
reconsideration.
This being so, it would certainly have been entirely within the authority of the Court of
Appeals, under normal circumstances, to rule on that motion for reconsideration and, in its
discretion, act favorably on it, as it did through its Resolution of September 27, 1991 — by
amending the decision of June 9, 1989, declaring it a partial judgment, and setting a date for
reception of evidence on the la Fuente's claim for damages.
It would also appear that the motions for reconsideration of said Resolution of September 27,
1991 separately submitted in Gozon's behalf, by her own private attorney and by the Solicitor
General's Office, were filed way out of time. As also already pointed out, notice of that Resolution
of September 27, 1991 was served on Gozon's counsel on October 3, 1989 and on Gozon herself
on October 4, 1989; but the motion for reconsideration of Atty. Martinez (Gozon's private lawyer)
was not filed until November 10, 1989, thirty-eight (38) days afterwards, and that of the Solicitor
General, until November 16, 1989, or forty-four (44) days later. What is worse is that, its motion for
reconsideration of November 16, 1989 having been denied by a Resolution dated January 11,
1991, notice of which it received on January 18, 1991, the Solicitor General's Office filed still
another motion for reconsideration on January 30, 1991, ostensibly directed against that
Resolution of January 11, 1991 but actually seeking the setting aside of the Resolution of
September 17, 1989. In effect it filed a second motion for reconsideration which, of course, is
prohibited by law. 46
However, disposition of the question simply and solely on the foregoing premises is precluded by
the fact that prior to the promulgation by the Appellate Court of its Resolution of September 27,
1989. — granting de la Fuente's motion for reconsideration of June 29, 1989 — de la Fuente had
asked for and been granted by the Court of Appeals, authority to execute the decision of June 9,
1989 and had in fact succeeded in bringing about satisfaction thereof, in so far as concerned his
reinstatement to the position from which he had been illegally ousted and the payment to him his
salaries and allowances.
It has therefore become essential to determine the effect of the execution of said decision of June
9, 1989 at de la Fuente's instance, on the power of the Court of Appeals to modify that judgment
as earlier prayed for by de la Fuente in such a way as to concede the latter's capacity to claim
damages in his mandamus action, and consequently authorize him to present evidence on the
matter.
The general rule is that when a judgment has been satisfied, it passes beyond review, satisfaction
being the last act and end of the proceedings, and payment of satisfaction of the obligation
thereby established produces permanent and irrevocable discharge; 47 hence, a judgment debtor
who acquiesces in and voluntarily complies with the judgment, is estopped from taking an appeal
therefrom. 48
On the other hand the question of whether or not a judgment creditor is estopped from appealing
or seeking modification of a judgment which has been executed at his instance, is one dependent
upon the nature of the judgment as being indivisible or not. This is the doctrine laid down by this
Court in a case decided as early as 1925, Verches v. Rios. 49 In that case this Court held that
although "there are cases holding the contrary view," where the judgment is indivisible, "the weight
of authority is to the effect that an acceptance of full satisfaction of the judgment annihilates the
right to further prosecute the appeal; . . . that a party who has recovered judgment on a claim
which cannot be split up and made the basis of several causes of action, and afterwards coerced
full satisfaction by writ of execution or authority of the court, cannot maintain an appeal from the
judgment against the objections of the judgment debtor;" and that even partial execution by
compulsory legal process at the instance of a party in whose favor a judgment appealed from was
rendered, places said party in estoppel to ask that the judgment be amended, either "by appeal or
answer to his adversary's appeal, or otherwise." 50
A converso, where the judgment is divisible, estoppel should not operate against the judgment
creditor who causes implementation of a part of the decision by writ of execution. This is the clear
import of Verches and the precedents therein invoked. It is an aspect of the principle above
mentioned that is fully consistent not only with the dissenting opinion that "(a)cceptance
of payment of . . . only the uncontroverted part of the claim . . . should not preclude the plaintiff
from prosecuting his appeal, to determine whether he should not have been allowed more," 51 but
also with logic and common sense.
la Fuente's view, the filing of a mandamus action in the Court of Appeals; the initial refusal of the
latter Court to acknowledge his right to damages in connection with the mandamus suit; and
ultimately, the change of view by the Court of Appeals, on de la Fuente's motion, as regards its
competence to take cognizance of the matter of damages in relation to
the mandamus proceeding.
Under these circumstances, there was no reason whatsoever to defer concession to de la Fuente
of the relief of reinstatement — to which he
was indisputably already entitled — in the meantime that issues arising after finality of the Civil
Service Commission's judgment were being ventilated and resolved — these issues being, to
repeat, whether or not the refusal by Gozon, et al. obey said judgment of the Commission could
be justified, and whether or not, by reason of that refusal to obey, de la Fuente did in fact suffer
compensable injury.
It was therefore correct for the Court of Appeals, albeit by implication, to treat its judgment as
divisible, or capable of being enforced by parts, and to consider de la Fuente as not having been
placed in estoppel to pursue his claim for damages by seeking and obtaining authority for a partial
execution of the judgment. De la Fuente not being in estoppel, it follows that his motion for
reconsideration, timely filed, was not deemed abandoned or waived by the partial execution of the
judgment, and jurisdiction of the Court of Appeals to amend the judgment was retained and not
lost. It follows, too, that since no motion for reconsideration was filed against, or appeal attempted
to be taken from, the Resolution of the Court of Appeals amending its original judgment, within the
time prescribed therefor by law, said amendatory resolution has long since become final and
immutable, particularly in so far as it holds itself competent to take cognizance of the matter of
damages and authorizes the reception of evidence on de la Fuente's claim therefor.

In this case, the amended judgment of the Court of Appeals is clearly divisible, satisfaction of WHEREFORE, the petition is DENIED, and the challenged Resolutions of September 27, 1989,
which may be "split up." One part has reference to the enforcement of the final and executory January 11, 1991 and August 7, 1991 are AFFIRMED, without pronouncement as to costs.
judgment of the Civil Service Commission, that de la Fuente should be reinstated to the position of
Chief of Clinics (now Chief of Medical Professional Staff) without loss of seniority rights and that SO ORDERED.
he be paid his back salaries and all monetary benefits due him from the date of his illegal
demotion. This part is no longer issuable, and has not in truth been controverted by Gozon herself.
The other part has reference to the damages which de la Fuente contends he suffered as a result
of the unjustified refusal of Gozon and her co-parties to comply with the final and executory
judgment of the Civil Service Commission, and which the Appellate Tribunal has allowed him to
prove. Obviously, the second part cannot possibly affect the first. Whether de la Fuente succeeds
or fails in his bid to recover damages against Gozon, et al. because of their refusal to obey the
judgment of the Civil Service Commission, is a contingency that cannot affect the unalterable
enforceability of that judgment. Similarly, the enforcement of the Commission's judgment (already
accomplished by writ of execution of the Court of Appeals issued at de la Fuente's instance)
cannot influence in any manner the question whether or not there was culpable refusal on the part
of Gozon, et al. to comply with said judgment when first required so to do, and whether de la
Fuente did in fact suffer compensable injury thereby.

It bears stressing that the juridical situation in which de la Fuente finds himself is not of his making.
It is a consequence of circumstances not attributable to any fault on his part, i.e., the unwarranted
refusal or neglect of his superiors to obey the executory judgment of the Civil Service Commission;
the erroneous refusal of the Commission to execute its own decision which made necessary, in de
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 130866 September 16, 1998
ST. MARTIN FUNERAL HOME, petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION and BIENVENIDO ARICAYOS, respondents.
REGALADO, J.:
The present petition for certiorari stemmed from a complaint for illegal dismissal filed by herein
private respondent before the National Labor Relations Commission (NLRC), Regional Arbitration
Branch No. III, in San Fernando, Pampanga. Private respondent alleges that he started working
as Operations Manager of petitioner St. Martin Funeral Home on February 6, 1995. However,
there was no contract of employment executed between him and petitioner nor was his name
included in the semi-monthly payroll. On January 22, 1996, he was dismissed from his
employment for allegedly misappropriating P38,000.00 which was intended for payment by
petitioner of its value added tax (VAT) to the Bureau of Internal Revenue (BIR). 1
Petitioner on the other hand claims that private respondent was not its employee but only the
uncle of Amelita Malabed, the owner of petitioner St. Martin's Funeral Home. Sometime in 1995,
private respondent, who was formerly working as an overseas contract worker, asked for financial
assistance from the mother of Amelita. Since then, as an indication of gratitude, private
respondent voluntarily helped the mother of Amelita in overseeing the business.
In January 1996, the mother of Amelita passed away, so the latter then took over the management
of the business. She then discovered that there were arrears in the payment of taxes and other
government fees, although the records purported to show that the same were already paid.
Amelita then made some changes in the business operation and private respondent and his wife
were no longer allowed to participate in the management thereof. As a consequence, the latter
filed a complaint charging that petitioner had illegally terminated his employment.2
Based on the position papers of the parties, the labor arbiter rendered a decision in favor of
petitioner on October 25, 1996 declaring that no employer-employee relationship existed between
the parties and, therefore, his office had no jurisdiction over the case. 3
Not satisfied with the said decision, private respondent appealed to the NLRC contending that the
labor arbiter erred (1) in not giving credence to the evidence submitted by him; (2) in holding that
he worked as a "volunteer" and not as an employee of St. Martin Funeral Home from February 6,
1995 to January 23, 1996, or a period of about one year; and (3) in ruling that there was no
employer-employee relationship between him and petitioner.4
On June 13, 1997, the NLRC rendered a resolution setting aside the questioned decision and
remanding the case to the labor arbiter for immediate appropriate proceedings.5 Petitioner then
filed a motion for reconsideration which was denied by the NLRC in its resolution dated August 18,
1997 for lack of merit,6 hence the present petition alleging that the NLRC committed grave abuse
of discretion.7
Before proceeding further into the merits of the case at bar, the Court feels that it is now exigent
and opportune to reexamine the functional validity and systemic practicability of the mode of
judicial review it has long adopted and still follows with respect to decisions of the NLRC. The
increasing number of labor disputes that find their way to this Court and the legislative changes
introduced over the years into the provisions of Presidential Decree (P.D.) No. 442 (The Labor
Code of the Philippines and Batas Pambansa Blg. (B.P. No.) 129 (The Judiciary Reorganization
Act of 1980) now stridently call for and warrant a reassessment of that procedural aspect.
We prefatorily delve into the legal history of the NLRC. It was first established in the Department of
Labor by P.D. No. 21 on October 14, 1972, and its decisions were expressly declared to be
appealable to the Secretary of Labor and, ultimately, to the President of the Philippines.
On May 1, 1974, P.D. No. 442 enacted the Labor Code of the Philippines, the same to take effect
six months after its promulgation. 8 Created and regulated therein is the present NLRC which was
attached to the Department of Labor and Employment for program and policy coordination
only.9 Initially, Article 302 (now, Article 223) thereof also granted an aggrieved party the remedy of
appeal from the decision of the NLRC to the Secretary of Labor, but P.D. No. 1391 subsequently
amended said provision and abolished such appeals. No appellate review has since then been
provided for.
Thus, to repeat, under the present state of the law, there is no provision for appeals from the
decision of the NLRC. 10 The present Section 223, as last amended by Section 12 of R.A. No.
6715, instead merely provides that the Commission shall decide all cases within twenty days from
receipt of the answer of the appellee, and that such decision shall be final and executory after ten
calendar days from receipt thereof by the parties.
When the issue was raised in an early case on the argument that this Court has no jurisdiction to
review the decisions of the NLRC, and formerly of the Secretary of Labor, since there is no legal
provision for appellate review thereof, the Court nevertheless rejected that thesis. It held that there
is an underlying power of the courts to scrutinize the acts of such agencies on questions of law
and jurisdiction even though no right of review is given by statute; that the purpose of judicial
review is to keep the administrative agency within its jurisdiction and protect the substantial rights
of the parties; and that it is that part of the checks and balances which restricts the separation of
powers and forestalls arbitrary and unjust adjudications. 11
Pursuant to such ruling, and as sanctioned by subsequent decisions of this Court, the remedy of
the aggrieved party is to timely file a motion for reconsideration as a precondition for any further or
subsequent remedy, 12 and then seasonably avail of the special civil action of certiorari under Rule
65, 13 for which said Rule has now fixed the reglementary period of sixty days from notice of the
decision. Curiously, although the 10-day period for finality of the decision of the NLRC may
already have lapsed as contemplated in Section 223 of the Labor Code, it has been held that this
Court may still take cognizance of the petition for certiorari on jurisdictional and due process
considerations if filed within the reglementary period under Rule 65. 14
Turning now to the matter of judicial review of NLRC decisions, B.P. No. 129 originally provided as
follows:
Sec. 9. Jurisdiction. — The Intermediate Appellate Court shall exercise:
(1) Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus, and quo warranto, and auxiliary writs or processes, whether or not in aid
of its appellate jurisdiction;
(2) Exclusive original jurisdiction over actions for annulment of judgments of
Regional Trial Courts; and
(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions,
orders, or awards of Regional Trial Courts and quasi-judicial agencies,
instrumentalities, boards, or commissions, except those falling within the
appellate jurisdiction of the Supreme Court in accordance with the Constitution,
the provisions of this Act, and of subparagraph (1) of the third paragraph and
subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of
1948.
The Intermediate Appellate Court shall have the power to try cases and conduct
hearings, receive evidence and perform any and all acts necessary to resolve
factual issues raised in cases falling within its original and appellate jurisdiction,
including the power to grant and conduct new trials or further proceedings.
These provisions shall not apply to decisions and interlocutory orders issued
under the Labor Code of the Philippines and by the Central Board of Assessment
Appeals. 15
Subsequently, and as it presently reads, this provision was amended by R.A. No. 7902 effective
March 18, 1995, to wit:
Sec. 9. Jurisdiction. — The Court of Appeals shall exercise:
(1) Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus, and quo warranto, and auxiliary writs or processes, whether or not in aid
of its appellate jurisdiction;
(2) Exclusive original jurisdiction over actions for annulment of judgments of
Regional Trial Courts; and
(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions,
orders or awards of Regional Trial Courts and quasi-judicial agencies,
instrumentalities, boards or commissions, including the Securities and Exchange
Commission, the Social Security Commission, the Employees Compensation
Commission and the Civil Service Commission, except those falling within the
appellate jurisdiction of the Supreme Court in accordance with the Constitution,
the Labor Code of the Philippines under Presidential Decree No. 442, as
amended, the provisions of this Act, and of subparagraph (1) of the third
paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the
Judiciary Act of 1948.
The Court of Appeals shall have the power to try cases and conduct hearings,
receive evidence and perform any and all acts necessary to resolve factual
issues raised in cases falling within its original and appellate jurisdiction,
including the power to grant and conduct new trials or further proceedings. Trials
or hearings in the Court of Appeals must be continuous and must be completed
within, three (3) months, unless extended by the Chief Justice.
It will readily be observed that, aside from the change in the name of the lower appellate
court, 16 the following amendments of the original provisions of Section 9 of B.P. No. 129 were
effected by R.A. No. 7902, viz.:
1. The last paragraph which excluded its application to the Labor Code of the Philippines and the
Central Board of Assessment Appeals was deleted and replaced by a new paragraph granting the
Court of Appeals limited powers to conduct trials and hearings in cases within its jurisdiction.
2. The reference to the Labor Code in that last paragraph was transposed to paragraph (3) of the
section, such that the original exclusionary clause therein now provides "except those falling within
the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the Labor
Code of the Philippines under Presidential Decree No. 442, as amended, the provisions of this
Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph
of Section 17 of the Judiciary Act of 1948." (Emphasis supplied).
3. Contrarily, however, specifically added to and included among the quasi-judicial agencies over
which the Court of Appeals shall have exclusive appellate jurisdiction are the Securities and
Exchange Commission, the Social Security Commission, the Employees Compensation
Commission and the Civil Service Commission.
This, then, brings us to a somewhat perplexing impassè, both in point of purpose and terminology.
As earlier explained, our mode of judicial review over decisions of the NLRC has for some time
now been understood to be by a petition for certiorari under Rule 65 of the Rules of Court. This is,
of course, a special original action limited to the resolution of jurisdictional issues, that is, lack or
excess of jurisdiction and, in almost all cases that have been brought to us, grave abuse of
discretion amounting to lack of jurisdiction.
It will, however, be noted that paragraph (3), Section 9 of B.P. No. 129 now grants
exclusive appellate jurisdiction to the Court of Appeals over all final adjudications of the Regional
Trial Courts and the quasi-judicial agencies generally or specifically referred to therein except,
among others, "those falling within the appellate jurisdiction of the Supreme Court in accordance
with . . . the Labor Code of the Philippines under Presidential Decree No. 442, as amended, . . . ."
This would necessarily contradict what has been ruled and said all along that appeal does not lie
from decisions of the NLRC. 17 Yet, under such excepting clause literally construed, the appeal
from the NLRC cannot be brought to the Court of Appeals, but to this Court by necessary
implication.
The same exceptive clause further confuses the situation by declaring that the Court of Appeals
has no appellate jurisdiction over decisions falling within the appellate jurisdiction of the Supreme
Court in accordance with the Constitution, the provisions of B.P. No. 129, and those specified
cases in Section 17 of the Judiciary Act of 1948. These cases can, of course, be properly
excluded from the exclusive appellate jurisdiction of the Court of Appeals. However, because of
the aforementioned amendment by transposition, also supposedly excluded are cases falling
within the appellate jurisdiction of the Supreme Court in accordance with the Labor Code. This is
illogical and impracticable, and Congress could not have intended that procedural gaffe, since
there are no cases in the Labor Code the decisions, resolutions, orders or awards wherein are
within the appellate jurisdiction of the Supreme Court or of any other court for that matter.
A review of the legislative records on the antecedents of R.A. No. 7902 persuades us that there
may have been an oversight in the course of the deliberations on the said Act or an imprecision in
the terminology used therein. In fine, Congress did intend to provide for judicial review of the
adjudications of the NLRC in labor cases by the Supreme Court, but there was an inaccuracy in
the term used for the intended mode of review. This conclusion which we have reluctantly but
prudently arrived at has been drawn from the considerations extant in the records of Congress,
more particularly on Senate Bill No. 1495 and the Reference Committee Report on S. No. 1495/H.
No. 10452. 18
In sponsoring Senate Bill No. 1495, Senator Raul S. Roco delivered his sponsorship
speech 19 from which we reproduce the following excerpts:
The Judiciary Reorganization Act, Mr. President, Batas Pambansa Blg. 129,
reorganized the Court of Appeals and at the same time expanded its jurisdiction
and powers. Among others, its appellate jurisdiction was expanded to cover not
only final judgment of Regional Trial Courts, but also all final judgment(s),
decisions, resolutions, orders or awards of quasi-judicial agencies,
instrumentalities, boards and commissions, except those falling within the
appellate jurisdiction of the Supreme Court in accordance with the Constitution,
the provisions of BP Blg. 129 and of subparagraph 1 of the third paragraph and
subparagraph 4 of Section 17 of the Judiciary Act of 1948.
Mr. President, the purpose of the law is to ease the workload of the Supreme
Court by the transfer of some of its burden of review of factual issues to the Court
of Appeals. However, whatever benefits that can be derived from the expansion
of the appellate jurisdiction of the Court of Appeals was cut short by the last
paragraph of Section 9 of Batas Pambansa Blg. 129 which excludes from its
coverage the "decisions and interlocutory orders issued under the Labor Code of
the Philippines and by the Central Board of Assessment Appeals.
Among the highest number of cases that are brought up to the Supreme Court
are labor cases. Hence, Senate Bill No. 1495 seeks to eliminate the exceptions
enumerated in Section 9 and, additionally, extends the coverage of appellate
review of the Court of Appeals in the decision(s) of the Securities and Exchange
Commission, the Social Security Commission, and the Employees Compensation
Commission to reduce the number of cases elevated to the Supreme Court.
(Emphases and corrections ours)
xxx xxx xxx
Senate Bill No. 1495 authored by our distinguished Colleague from Laguna
provides the ideal situation of drastically reducing the workload of the Supreme
Court without depriving the litigants of the privilege of review by an appellate
tribunal.
In closing, allow me to quote the observations of former Chief Justice Teehankee
in 1986 in the Annual Report of the Supreme Court:
. . . Amendatory legislation is suggested so as to relieve the
Supreme Court of the burden of reviewing these cases which
present no important issues involved beyond the particular fact
and the parties involved, so that the Supreme Court may wholly
devote its time to cases of public interest in the discharge of its
mandated task as the guardian of the Constitution and the
guarantor of the people's basic rights and additional task
expressly vested on it now "to determine whether or not there
has been a grave abuse of discretion amounting to lack of
jurisdiction on the part of any branch or instrumentality of the
Government.
We used to have 500,000 cases pending all over the land, Mr. President. It has
been cut down to 300,000 cases some five years ago. I understand we are now
back to 400,000 cases. Unless we distribute the work of the appellate courts, we
shall continue to mount and add to the number of cases pending.
In view of the foregoing, Mr. President, and by virtue of all the reasons we have
submitted, the Committee on Justice and Human Rights requests the support
and collegial approval of our Chamber.
xxx xxx xxx
Surprisingly, however, in a subsequent session, the following Committee Amendment was
introduced by the said sponsor and the following proceedings transpired: 20
 Senator Roco. On page 2, line 5, after the line "Supreme Court in accordance
with the Constitution," add the phrase "THE LABOR CODE OF THE
PHILIPPINES UNDER P.D. 442, AS AMENDED." So that it becomes clear, Mr.
President, that issues arising from the Labor Code will still be appealable to the
Supreme Court.
The President. Is there any objection? (Silence) Hearing none, the amendment is
approved.
Senator Roco. On the same page, we move that lines 25 to 30 be deleted. This
was also discussed with our Colleagues in the House of Representatives and as
we understand it, as approved in the House, this was also deleted, Mr. President.
The President. Is there any objection? (Silence) Hearing none, the amendment is
approved.
Senator Roco. There are no further Committee amendments, Mr. President.
Senator Romulo. Mr. President, I move that we close the period of Committee
amendments.
The President. Is there any objection? (Silence) Hearing none, the amendment is
approved. (Emphasis supplied).
xxx xxx xxx
Thereafter, since there were no individual amendments, Senate Bill No. 1495 was passed on
second reading and being a certified bill, its unanimous approval on third reading followed. 21 The
Conference Committee Report on Senate Bill No. 1495 and House Bill No. 10452, having
theretofore been approved by the House of Representatives, the same was likewise approved by
the Senate on February 20, 1995, 22 inclusive of the dubious formulation on appeals to the
Supreme Court earlier discussed.
The Court is, therefore, of the considered opinion that ever since appeals from the NLRC to the
Supreme Court were eliminated, the legislative intendment was that the special civil action
of certiorari was and still is the proper vehicle for judicial review of decisions of the NLRC. The use
of the word "appeal" in relation thereto and in the instances we have noted could have been
a lapsus plumae because appeals by certiorari and the original action for certiorari are both modes
of judicial review addressed to the appellate courts. The important distinction between them,
however, and with which the Court is particularly concerned here is that the special civil action
of certiorari is within the concurrent original jurisdiction of this Court and the Court of
Appeals; 23 whereas to indulge in the assumption that appeals by certiorari to the Supreme Court
are allowed would not subserve, but would subvert, the intention of Congress as expressed in the
sponsorship speech on Senate Bill No. 1495.
Incidentally, it was noted by the sponsor therein that some quarters were of the opinion that
recourse from the NLRC to the Court of Appeals as an initial step in the process of judicial review
would be circuitous and would prolong the proceedings. On the contrary, as he commendably and
realistically emphasized, that procedure would be advantageous to the aggrieved party on this
reasoning:
On the other hand, Mr. President, to allow these cases to be appealed to the
Court of Appeals would give litigants the advantage to have all the evidence on
record be reexamined and reweighed after which the findings of facts and
conclusions of said bodies are correspondingly affirmed, modified or reversed.
Under such guarantee, the Supreme Court can then apply strictly the axiom that
factual findings of the Court of Appeals are final and may not be reversed on
appeal to the Supreme Court. A perusal of the records will reveal appeals which
are factual in nature and may, therefore, be dismissed outright by minute
resolutions. 24
While we do not wish to intrude into the Congressional sphere on the matter of the wisdom of a
law, on this score we add the further observations that there is a growing number of labor cases
being elevated to this Court which, not being a trier of fact, has at times been constrained to
remand the case to the NLRC for resolution of unclear or ambiguous factual findings; that the
Court of Appeals is procedurally equipped for that purpose, aside from the increased number of its
component divisions; and that there is undeniably an imperative need for expeditious action on
labor cases as a major aspect of constitutional protection to labor.
Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the
NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to petitions
for certiorari under Rule 65. Consequently, all such petitions should hence forth be initially filed in
the Court of Appeals in strict observance of the doctrine on the hierarchy of courts as the
appropriate forum for the relief desired.
Apropos to this directive that resort to the higher courts should be made in accordance with their
hierarchical order, this pronouncement in Santiago vs. Vasquez, et al. 25 should be taken into
account:
One final observation. We discern in the proceedings in this case a propensity on
the part of petitioner, and, for that matter, the same may be said of a number of
litigants who initiate recourses before us, to disregard the hierarchy of courts in
our judicial system by seeking relief directly from this Court despite the fact that
the same is available in the lower courts in the exercise of their original or
concurrent jurisdiction, or is even mandated by law to be sought therein. This
practice must be stopped, not only because of the imposition upon the precious
time of this Court but also because of the inevitable and resultant delay, intended
or otherwise, in the adjudication of the case which often has to be remanded or
referred to the lower court as the proper forum under the rules of procedure, or
as better equipped to resolve the issues since this Court is not a trier of facts.
We, therefore, reiterate the judicial policy that this Court will not entertain direct
 resort to it unless the redress desired cannot be obtained in the appropriate
courts or where exceptional and compelling circumstances justify availment of a
remedy within and calling for the exercise of our primary jurisdiction.

WHEREFORE, under the foregoing premises, the instant petition for certiorari is hereby
REMANDED, and all pertinent records thereof ordered to be FORWARDED, to the Court of
Appeals for appropriate action and disposition consistent with the views and ruling herein set forth,
without pronouncement as to costs.

SO ORDERED.
 FIRST DIVISION
Art. 89 of P.D. 1067 having been long repealed by BP 129, as amended, which
has effectively and explicitly removed the Regional Trial Courts appellate
NATIONAL WATER RESOURCES BOARD G.R. No. 186450 jurisdiction over the decisions, resolutions, order[s] or awards of quasi-judicial
(NWRB), agencies such as [petitioner] NWRB, and vested with the Court of Appeals, very
Petitioner, Present: clearly now, this Court has no jurisdiction over this instant petition.

PUNO, C.J., Its motion for reconsideration having been denied, respondent filed a petition for certiorari
CARPIO MORALES, at the Court of Appeals, which, by Decision of January 25, 2008, [5] annulled and set aside the
- versus - LEONARDO-DE CASTRO, RTC April 15, 2005, holding that it is the RTC which has jurisdiction over appeals from petitioners
BERSAMIN, and decisions. Thus the appellate court discoursed.
VILLARAMA, JR., JJ.
In the analogous case of BF Northwest Homeowners Association,
A. L. ANG NETWORK, INC., Promulgated: Inc. vs. Intermediate Appellate Court[,] the Supreme Court . . . categorically
Respondent. April 8, 2010 pronounced the RTCs jurisdiction over appeals from the decisions of the NWRB
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x consistent with Article 89 of P.D. No. 1067 and ratiocinated in this wise:

x x x x.

DECISION The logical conclusion, therefore, is that jurisdiction over actions

CARPIO MORALES, J.:
In issue is whether Regional Trial Courts have jurisdiction over appeals from decisions,
resolutions or orders of the National Water Resources Board (petitioner).
A.L. Ang Network (respondent) filed on January 23, 2003 an application for a Certificate
of Public Convenience (CPC) with petitioner to operate and maintain a water service system in
Alijis, Bacolod City.
for annulment of NWRC decisions lies with the Regional Trial Courts,
particularly, when we take note of the fact that the appellate jurisdiction
of the Regional Trial Court over NWRC decisions covers such broad and
all embracing grounds as grave abuse of discretion, questions of law,
and questions of fact and law (Art. 89, P.D. No. 1067). This conclusion is
also in keeping with the Judiciary Reorganization Act of 1980, which
vests Regional Trial Courts with original jurisdiction to issue writs of
certiorari, prohibition, mandamus, etc. (Sec. 21 [1], B.P. Blg. 129)
relating to acts or omissions of an inferior court (Sec. 4, Rule 65, Rules
of Court).

Bacolod City Water District (BACIWA) opposed respondents application on the ground x x x x.
that it is the only government agency authorized to operate a water service system within the Similarly, in Tanjay Water District vs. Pedro Gabaton, the Supreme
city.[1] Court conformably ruled, viz:

By Decision of August 20, 2003, petitioner granted respondents CPC
application. BACIWA moved to have the decision reconsidered, contending that its right to due
process was violated when it was not allowed to present evidence in support of its opposition. [2]
Petitioner reconsidered its Decision and allowed BACIWA to present evidence,[3] drawing
respondent to file a petition for certiorari with the Regional Trial Court (RTC) of Bacolod City
against petitioner and BACIWA. Petitioner moved to dismiss the petition, arguing that the proper
recourse of respondent was to the Court of Appeals, citing Rule 43 of the Rules of Court.
The RTC, by Order of April 15, 2005,[4] dismissed respondents petition for lack of jurisdiction,
holding that it is the Court of Appeals which has exclusive appellate jurisdiction over all final
judgments, decisions, resolutions, order[s] or awards of . . . quasi-judicial agencies,
instrumentalities, boards or commission[s] . . . except those within the appellate jurisdiction of the
Supreme Court . . . . Thus the RTC explained:
Inasmuch as Civil Case No. 8144 involves the appropriation,
utilization and control of water, We hold that the jurisdiction to hear and
decide the dispute in the first instance, pertains to the Water Resources
Council as provided in PD No. 1067 which is the special law on the
subject. The Court of First Instance (now Regional Trial Court) has only
appellate jurisdiction over the case.
Based on the foregoing jurisprudence, there is no doubt that [petitioner]
NWRB is mistaken in its assertion. As no repeal is expressly made, Article 89 of
P.D. No. 1067 is certainly meant to be an exception to the jurisdiction of the
Court of Appeals over appeals or petitions for certiorari of the decisions of
quasi-judicial bodies. This finds harmony with Paragraph 2, Section 4, Rule 65
of the Rules of Court wherein it is stated that, If it involves the acts of a quasi-
judicial agency, unless otherwise provided by law or these rules, the petition shall
 be filed in and cognizable only by the Court of Appeals. Evidently, not all petitions
for certiorari under Rule 65 involving the decisions of quasi-judicial agencies
must be filed with the Court of Appeals. The rule admits of some exceptions as
plainly provided by the phrase unless otherwise provided by law or these
rules and Article 89 of P.D. No. 1067 is verily an example of these
exceptions. (italics and emphasis partly in the original; underscoring supplied)
Petitioners motion for reconsideration having been denied by the appellate court by
Resolution of February 9, 2009,[6] petitioner filed the present petition for review, contending that:
THE REGIONAL TRIAL COURT HAS NO CERTIORARI JURISDICTION OVER
THE [PETITIONER] SINCE SECTION 89, PD NO. 1067, REGARDING
APPEALS, HAS BEEN SUPERSEDED AND REPEALED BY [BATAS
PAMBANSA BILANG] 129 AND THE RULES OF COURT. FURTHERMORE, PD
1067 ITSELF DOES NOT CONTEMPLATE THAT THE REGIONAL TRIAL
COURT SHOULD HAVE CERTIORARI JURISDICTION OVER THE
[PETITIONER].[7] (underscoring supplied)
Petitioner maintains that the RTC does not have jurisdiction over a petition
for certiorari and prohibition to annul or modify its acts or omissions as a quasi-judicial
agency. Citing Section 4 of Rule 65 of the Rules of Court, petitioner contends that there is no law
or rule which requires the filing of a petition for certiorari over its acts or omissions in any other
court or tribunal other than the Court of Appeals.[8]
Petitioner goes on to fault the appellate court in holding that Batas Pambansa Bilang 129
(BP 129) or the Judiciary Reorganization Act did not expressly repeal Article 89 of Presidential
Decree No. 1067 (PD 1067) otherwise known as the Water Code of the Philippines.[9]
Respondent, on the other hand, maintains the correctness of the assailed decision of the
appellate court.
The petition is impressed with merit.
Section 9 (1) of BP 129 granted the Court of Appeals (then known as the Intermediate
Appellate Court) original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus and quo warranto, and auxiliary writs or processes, whether or not in aid of its appellate
jurisdiction.[10]
Since the appellate court has exclusive appellate jurisdiction over quasi-judicial agencies
under Rule 43[11] of the Rules of Court, petitions for writs of certiorari, prohibition or mandamus
against the acts and omissions of quasi-judicial agencies, like petitioner, should be filed with
it. This is what Rule 65 of the Rules imposes for procedural uniformity. The only exception to this
instruction is when the law or the Rules itself directs otherwise, as cited in Section 4, Rule
65.[12] The appellate courts construction that Article 89 of PD 1067, which reads:
ART. 89. The decisions of the [NWRB] on water rights controversies may
be appealed to the [RTC] of the province where the subject matter of the
controversy is situated within fifteen (15) days from the date the party appealing
receives a copy of the decision, on any of the following grounds: (1) grave abuse
of discretion; (2) question of law; and (3) questions of fact and law (emphasis
and underscoring supplied),
is such an exception, is erroneous.
Article 89 of PD 1067 had long been rendered inoperative by the passage of BP
129. Aside from delineating the jurisdictions of the Court of Appeals and the RTCs, Section 47 of
BP 129 repealed or modified:
x x x. [t]he provisions of Republic Act No. 296, otherwise known as the
Judiciary Act of 1948, as amended, of Republic Act No. 5179, as amended, of
the Rules of Court, and of all other statutes, letters of instructions and
general orders or parts thereof, inconsistent with the provisions of this
Act x x x. (emphasis and underscoring supplied)
The general repealing clause under Section 47 predicates the intended repeal under the condition
that a substantial conflict must be found in existing and prior acts.[13]
In enacting BP 129, the Batasang Pambansa was presumed to have knowledge of the
provision of Article 89 of P.D. No. 1067 and to have intended to change it. [14] The legislative intent
to repeal Article 89 is clear and manifest given the scope and purpose of BP 129, one of which is
to provide a homogeneous procedure for the review of adjudications of quasi-judicial entities to the
Court of Appeals.
More importantly, what Article 89 of PD 1067 conferred to the RTC was the power of
review on appeal the decisions of petitioner. It appears that the appellate court gave significant
consideration to the ground of grave abuse of discretion to thus hold that the RTC
has certiorari jurisdiction over petitioners decisions. A reading of said Article 89 shows, however,
that it only made grave abuse of discretion as another ground to invoke in an ordinary appeal to
the RTC. Indeed, the provision was unique to the Water Code at the time of its application in 1976.
The issuance of BP 129, specifically Section 9 (Jurisdiction of the Court of Appeals, then
known as Intermediate Appellate Court), and the subsequent formulation of the Rules, clarified
and delineated the appellate and certiorari jurisdictions of the Court of Appeals over adjudications
of quasi-judicial bodies. Grave abuse of discretion may be invoked before the appellate court as a
ground for an error of jurisdiction.
It bears noting that, in the present case, respondent assailed petitioners order
via certiorari before the RTC, invoking grave abuse of discretion amounting to lack or excess of
jurisdiction as ground-basis thereof. In other words, it invoked such ground not for an error of
judgment.
 While Section 9 (3) of BP 129[15] and Section 1 of Rule 43 of the Rules of Court[16] does
not list petitioner as among the quasi-judicial agencies whose final judgments, orders, resolutions
or awards are appealable to the appellate court, it is non sequitur to hold that the Court of Appeals
has no appellate jurisdiction over petitioners judgments, orders, resolutions or awards. It is settled
that the list of quasi-judicial agencies specifically mentioned in Rule 43 is not meant to be
exclusive.[17] The employment of the word among clearly instructs so.

BF Northwest Homeowners Association v. Intermediate Appellate Court,[18] a 1987 case

cited by the appellate court to support its ruling that RTCs have jurisdiction over judgments,
orders, resolutions or awards of petitioner, is no longer controlling in light of the definitive
instruction of Rule 43 of the Revised Rules of Court.

Tanjay Water District v. Gabaton[19] is not in point either as the issue raised therein was
which between the RTC and the then National Water Resources Council had jurisdiction over
disputes in the appropriation, utilization and control of water.

IN FINE, certiorari and appellate jurisdiction over adjudications of petitioner

properly belongs to the Court of Appeals.

WHEREFORE, the challenged Decision and Resolution of the Court of Appeals

are REVERSED and SET ASIDE. The April 15, 2005 Order of the Regional Trial Court of Bacolod
City dismissing petitioners petition for lack of jurisdiction is UPHELD.

No costs.

SO ORDERED.

SECOND DIVISION
CRESCENT PETROLEUM, LTD., G.R. No. 155014 Petitioner,
Present:
Puno, J.,
- versus - Chairman,
Austria-Martinez,
Callejo, Sr.,
Tinga, and
*
Chico-Nazario, JJ.
M/V LOK MAHESHWARI,
THE SHIPPING CORPORATION
OF INDIA, and PORTSERV LIMITED Promulgated:
and/or TRANSMAR SHIPPING, INC.,
Respondents. November 11, 2005
x--------------------------------------------------x
DECISION
PUNO, J.:
This petition for review on certiorari under Rule 45 seeks the (a) reversal of the November 28,
2001 Decision of the Court of Appeals in CA-G.R. No. CV-54920,[1] which dismissed for want of
jurisdiction the instant case, and the September 3, 2002 Resolution of the same appellate
court,[2] which denied petitioners motion for reconsideration, and (b) reinstatement of the July 25,
1996 Decision[3] of the Regional Trial Court (RTC) in Civil Case No. CEB-18679, which held that
respondents were solidarily liable to pay petitioner the sum prayed for in the complaint.
The facts are as follows: Respondent M/V Lok Maheshwari (Vessel) is an oceangoing vessel of
Indian registry that is owned by respondent Shipping Corporation of India (SCI), a corporation
organized and existing under the laws of India and principally owned by the Government of India.
It was time-chartered by respondent SCI to Halla Merchant Marine Co. Ltd. (Halla), a South
Korean company. Halla, in turn, sub-chartered the Vessel through a time charter to Transmar
Shipping, Inc. (Transmar). Transmar further sub-chartered the Vessel to Portserv Limited
(Portserv). Both Transmar and Portserv are corporations organized and existing under the laws of
Canada.
On or about November 1, 1995, Portserv requested petitioner Crescent Petroleum, Ltd.
(Crescent), a corporation organized and existing under the laws of Canada that is engaged in the
business of selling petroleum and oil products for the use and operation of oceangoing vessels, to
deliver marine fuel oils (bunker fuels) to the Vessel. Petitioner Crescent granted and confirmed the
request through an advice via facsimile dated November 2, 1995. As security for the payment of
the bunker fuels and related services, petitioner Crescent received two (2) checks in the amounts
of US$100,000.00 and US$200,000.00. Thus, petitioner Crescent contracted with its supplier,
Marine Petrobulk Limited (Marine Petrobulk), another Canadian corporation, for the physical
delivery of the bunker fuels to the Vessel.
On or about November 4, 1995, Marine Petrobulk delivered the bunker fuels amounting to
US$103,544 inclusive of barging and demurrage charges to the Vessel at the port of Pioneer
Grain, Vancouver, Canada. The Chief Engineer Officer of the Vessel duly acknowledged and
received the delivery receipt. Marine Petrobulk issued an invoice to petitioner Crescent for the
US$101,400.00 worth of the bunker fuels. Petitioner Crescent issued a check for the same
amount in favor of Marine Petrobulk, which check was duly encashed.
Having paid Marine Petrobulk, petitioner Crescent issued a revised invoice dated
November 21, 1995 to Portserv Limited, and/or the Master, and/or Owners, and/or Operators,
and/or Charterers of M/V Lok Maheshwari in the amount of US$103,544.00 with instruction to
remit the amount on or before December 1, 1995. The period lapsed and several demands were
made but no payment was received. Also, the checks issued to petitioner Crescent as security for
the payment of the bunker fuels were dishonored for insufficiency of funds. As a consequence,
petitioner Crescent incurred additional expenses of US$8,572.61 for interest, tracking fees, and
legal fees.
On May 2, 1996, while the Vessel was docked at the port of Cebu City, petitioner
Crescent instituted before the RTC of Cebu City an action for a sum of money with prayer for
temporary restraining order and writ of preliminary attachment against respondents Vessel and
SCI, Portserv and/or Transmar. The case was raffled to Branch 10 and docketed as Civil Case No.
CEB-18679.
On May 3, 1996, the trial court issued a writ of attachment against the Vessel with bond
at P2,710,000.00. Petitioner Crescent withdrew its prayer for a temporary restraining order and
posted the required bond.
On May 18, 1996, summonses were served to respondents Vessel and SCI, and Portserv and/or
Transmar through the Master of the Vessel. On May 28, 1996, respondents Vessel and SCI,
through Pioneer Insurance and Surety Corporation (Pioneer), filed an urgent ex-parte motion to
approve Pioneers letter of undertaking, to consider it as counter-bond and to discharge the
attachment. On May 29, 1996, the trial court granted the motion; thus, the letter of undertaking
was approved as counter-bond to discharge the attachment.
For failing to file their respective answers and upon motion of petitioner Crescent, the trial court
declared respondents Vessel and SCI, Portserv and/or Transmar in default. Petitioner Crescent
was allowed to present its evidence ex-parte.
On July 25, 1996, the trial court rendered its decision in favor of petitioner Crescent, thus:
WHEREFORE, premises considered, judgment is hereby rendered in
favor of plaintiff [Crescent] and against the defendants [Vessel, SCI, Portserv
and/or Transmar].
Consequently, the latter are hereby ordered to pay plaintiff jointly and solidarily,
the following:
(a) the sum of US$103,544.00, representing the outstanding
obligation;
(b) interest of US$10,978.50 as of July 3, 1996, plus additional
interest at 18% per annum for the period thereafter, until the
principal account is fully paid;
 (c) attorneys fees of P300,000.00; and
(d) P200,000.00 as litigation expenses.
SO ORDERED.
On August 19, 1996, respondents Vessel and SCI appealed to the Court of Appeals.
They attached copies of the charter parties between respondent SCI and Halla, between Halla
and Transmar, and between Transmar and Portserv. They pointed out that Portserv was a time
charterer and that there is a clause in the time charters between respondent SCI and Halla, and
between Halla and Transmar, which states that the Charterers shall provide and pay for all the
fuel except as otherwise agreed. They submitted a copy of Part II of the Bunker Fuel Agreement
between petitioner Crescent and Portserv containing a stipulation that New York law governs the
construction, validity and performance of the contract. They likewise submitted certified copies of
the Commercial Instruments and Maritime Lien Act of the United States (U.S.), some U.S. cases,
and some Canadian cases to support their defense.
On November 28, 2001, the Court of Appeals issued its assailed Decision, which
reversed that of the trial court, viz:
WHEREFORE, premises considered, the Decision dated July 25,
1996, issued by the Regional Trial Court of Cebu City, Branch 10, is hereby
REVERSED and SET ASIDE, and a new one is entered DISMISSING the
instant case for want of jurisdiction.
The appellate court denied petitioner Crescents motion for reconsideration explaining that
it dismissed the instant action primarily on the ground of forum non conveniensconsidering that
the parties are foreign corporations which are not doing business in the Philippines.
Hence, this petition submitting the following issues for resolution, viz:
1. Philippine courts have jurisdiction over a foreign vessel found
inside Philippine waters for the enforcement of a maritime lien against
said vessel and/or its owners and operators;
2. The principle of forum non conveniens is inapplicable to the instant
case;
3. The trial court acquired jurisdiction over the subject matter of the
instant case, as well as over the res and over the persons of the
parties;
4. The enforcement of a maritime lien on the subject vessel is
expressly granted by law. The Ship Mortgage Acts as well as the Code
of Commerce provides for relief to petitioner for its unpaid claim;
5. The arbitration clause in the contract was not rigid or inflexible but
expressly allowed petitioner to enforce its maritime lien in Philippine
courts provided the vessel was in the Philippines;
6. The law of the state of New York is inapplicable to the present
controversy as the same has not been properly pleaded and proved;
7. Petitioner has legal capacity to sue before Philippine courts as it is
suing upon an isolated business transaction;
8. Respondents were duly served summons although service of
summons upon respondents is not a jurisdictional requirement, the
action being a suit quasi in rem;
9. The trial courts decision has factual and legal bases; and,
10. The respondents should be held jointly and solidarily liable.
In a nutshell, this case is for the satisfaction of unpaid supplies furnished by a foreign
supplier in a foreign port to a vessel of foreign registry that is owned, chartered and sub-chartered
by foreign entities.
Under Batas Pambansa Bilang 129, as amended by Republic Act No. 7691, RTCs
exercise exclusive original jurisdiction (i)n all actions in admiralty and maritime where the demand
or claim exceeds two hundred thousand pesos (P200,000) or in Metro Manila, where such
demand or claim exceeds four hundred thousand pesos (P400,000). Two (2) tests have been
used to determine whether a case involving a contract comes within the admiralty and maritime
jurisdiction of a court - the locational test and the subject matter test. The English rule follows
the locational test wherein maritime and admiralty jurisdiction, with a few exceptions, is exercised
only on contracts made upon the sea and to be executed thereon. This is totally rejected under the
American rule where the criterion in determining whether a contract is maritime depends on the
nature and subject matter of the contract, having reference to maritime service and
transactions.[4] In International Harvester Company of the Philippines v. Aragon,[5] we adopted
the American rule and held that (w)hether or not a contract is maritime depends not on the place
where the contract is made and is to be executed, making the locality the test, but on the subject
matter of the contract, making the true criterion a maritime service or a maritime transaction.
A contract for furnishing supplies like the one involved in this case is maritime and within
the jurisdiction of admiralty.[6] It may be invoked before our courts through an action in
rem or quasi in rem or an action in personam. Thus: [7]
xxx
Articles 579 and 584 [of the Code of Commerce] provide a method of
collecting or enforcing not only the liens created under Section 580 but also for
the collection of any kind of lien whatsoever.[8] In the Philippines, we have a
complete legislation, both substantive and adjective, under which to bring an
action in rem against a vessel for the purpose of enforcing liens. The
substantive law is found in Article 580 of the Code of Commerce. The
procedural law is to be found in Article 584 of the same Code. The result is,
therefore, that in the Philippines any vessel even though it be a foreign vessel
found in any port of this Archipelago may be attached and sold under the
substantive law which defines the right, and the procedural law contained in the
 Code of Commerce by which this right is to be enforced. [9] x x x. But where
neither the law nor the contract between the parties creates any lien or charge
upon the vessel, the only way in which it can be seized before judgment is by
pursuing the remedy relating to attachment under Rule 59 [now Rule 57] of the
Rules of Court.[10]
But, is petitioner Crescent entitled to a maritime lien under our laws? Petitioner Crescent
bases its claim of a maritime lien on Sections 21, 22 and 23 of Presidential Decree No.
1521 (P.D. No. 1521), also known as the Ship Mortgage Decree of 1978, viz:
Sec. 21. Maritime Lien for Necessaries; persons entitled to such lien. -
Any person furnishing repairs, supplies, towage, use of dry dock or maritime
railway, or other necessaries, to any vessel, whether foreign or domestic, upon
the order of the owner of such vessel, or of a person authorized by the owner,
shall have a maritime lien on the vessel, which may be enforced by suit in rem,
and it shall be necessary to allege or prove that credit was given to the vessel.
Sec. 22. Persons Authorized to Procure Repairs, Supplies and
Necessaries. - The following persons shall be presumed to have authority from
the owner to procure repairs, supplies, towage, use of dry dock or marine
railway, and other necessaries for the vessel: The managing owner, ships
husband, master or any person to whom the management of the vessel at the
port of supply is entrusted. No person tortuously or unlawfully in possession or
charge of a vessel shall have authority to bind the vessel.
Sec. 23. Notice to Person Furnishing Repairs, Supplies and
Necessaries. - The officers and agents of a vessel specified in Section 22 of this
Decree shall be taken to include such officers and agents when appointed by a
charterer, by an owner pro hac vice, or by an agreed purchaser in possession of
the vessel; but nothing in this Decree shall be construed to confer a lien when
the furnisher knew, or by exercise of reasonable diligence could have
ascertained, that because of the terms of a charter party, agreement for sale of
the vessel, or for any other reason, the person ordering the repairs, supplies, or
other necessaries was without authority to bind the vessel therefor.
Petitioner Crescent submits that these provisions apply to both domestic and foreign
vessels, as well as domestic and foreign suppliers of necessaries. It contends that the use of the
term any person in Section 21 implies that the law is not restricted to domestic suppliers but also
includes all persons who supply provisions and necessaries to a vessel, whether foreign or
domestic. It points out further that the law does not indicate that the supplies or necessaries must
be furnished in the Philippines in order to give petitioner the right to seek enforcement of the lien
with a Philippine court.[11]
Respondents Vessel and SCI, on the other hand, maintain that Section 21 of the P.D. No.
1521 or the Ship Mortgage Decree of 1978 does not apply to a foreign supplier like petitioner
Crescent as the provision refers only to a situation where the person furnishing the supplies is
situated inside the territory of the Philippines and not where the necessaries were furnished in a
foreign jurisdiction like Canada.[12]
We find against petitioner Crescent.
I.
P.D. No. 1521 or the Ship Mortgage Decree of 1978 was enacted to accelerate the
growth and development of the shipping industry and to extend the benefits accorded to overseas
shipping under Presidential Decree No. 214 to domestic shipping.[13] It is patterned closely from
the U.S. Ship Mortgage Act of 1920 and the Liberian Maritime Law relating to preferred
mortgages.[14] Notably, Sections 21, 22 and 23 of P.D. No. 1521 or the Ship Mortgage Decree of
1978 are identical to Subsections P, Q, and R, respectively, of the U.S. Ship Mortgage Act of
1920, which is part of the Federal Maritime Lien Act. Hence, U.S. jurisprudence finds relevance to
determining whether P.D. No. 1521 or the Ship Mortgage Decree of 1978 applies in the present
case.
The various tests used in the U.S. to determine whether a maritime lien exists are the
following:
One. In a suit to establish and enforce a maritime lien for supplies furnished to a vessel in
a foreign port, whether such lien exists, or whether the court has or will exercise jurisdiction,
depends on the law of the country where the supplies were furnished, which must be pleaded
and proved.[15] This principle was laid down in the 1888 case of The Scotia,[16] reiterated in The
Kaiser Wilhelm II[17] (1916), in The Woudrichem[18] (1921) and in The City of Atlanta[19] (1924).
Two. The Lauritzen-Romero-Rhoditis trilogy of cases, which replaced such single-
factor methodologies as the law of the place of supply.[20]
In Lauritzen v. Larsen,[21] a Danish seaman, while temporarily in New York, joined the
crew of a ship of Danish flag and registry that is owned by a Danish citizen. He signed the ships
articles providing that the rights of the crew members would be governed by Danish law and by
the employers contract with the Danish Seamens Union, of which he was a member. While in
Havana and in the course of his employment, he was negligently injured. He sued the shipowner
in a federal district court in New York for damages under the Jones Act. In holding that Danish law
and not the Jones Act was applicable, the Supreme Court adopted a multiple-contact test to
determine, in the absence of a specific Congressional directive as to the statutes reach, which
jurisdictions law should be applied. The following factors were considered: (1) place of the
wrongful act; (2) law of the flag; (3) allegiance or domicile of the injured; (4) allegiance of
the defendant shipowner; (5) place of contract; (6) inaccessibility of foreign forum; and (7)
law of the forum.
Several years after Lauritzen, the U.S. Supreme Court in the case of Romero v.
International Terminal Operating Co.[22] again considered a foreign seamans personal injury
claim under both the Jones Act and the general maritime law. The Court held that the factors first
announced in the case of Lauritzen were applicable not only to personal injury claims arising
under the Jones Act but to all matters arising under maritime law in general.[23]
Hellenic Lines, Ltd. v. Rhoditis[24] was also a suit under the Jones Act by a Greek
seaman injured aboard a ship of Greek registry while in American waters. The ship was operated
by a Greek corporation which has its largest office in New York and another office in New Orleans
and whose stock is more than 95% owned by a U.S. domiciliary who is also a Greek citizen. The
ship was engaged in regularly scheduled runs between various ports of the U.S. and the Middle
East, Pakistan, and India, with its entire income coming from either originating or terminating in the
U.S. The contract of employment provided that Greek law and a Greek collective bargaining
agreement would apply between the employer and the seaman and that all claims arising out of
the employment contract were to be adjudicated by a Greek court. The U.S. Supreme Court
observed that of the seven factors listed in the Lauritzen test, four were in favor of the
shipowner and against jurisdiction. In arriving at the conclusion that the Jones Act applies, it
ruled that the application of the Lauritzen test is not a mechanical one. It stated thus: [t]he
significance of one or more factors must be considered in light of the national interest served by
the assertion of Jones Act jurisdiction. (footnote omitted) Moreover, the list of seven factors in
Lauritzen was not intended to be exhaustive. x x x [T]he shipowners base of operations is another
factor of importance in determining whether the Jones Act is applicable; and there well may be
others.
The principles enunciated in these maritime tort cases have been extended to cases
involving unpaid supplies and necessaries such as the
cases of Forsythe International U.K., Ltd. v. M/V Ruth Venture,[25] and Comoco Marine
Services v. M/V El Centroamericano.[26]
Three. The factors provided in Restatement (Second) of Conflicts of Law have also
been applied, especially in resolving cases brought under the Federal Maritime Lien Act. Their
application suggests that in the absence of an effective choice of law by the parties, the forum
contacts to be considered include: (a) the place of contracting; (b) the place of negotiation of the
contract; (c) the place of performance; (d) the location of the subject matter of the contract; and (e)
the domicile, residence, nationality, place of incorporation and place of business of the parties.[27]
In Gulf Trading and Transportation Co. v. The Vessel Hoegh Shield,[28] an admiralty
action in rem was brought by an American supplier against a vessel of Norwegian flag owned by a
Norwegian Company and chartered by a London time charterer for unpaid fuel oil and marine
diesel oil delivered while the vessel was in U.S. territory. The contract was executed in London. It
was held that because the bunker fuel was delivered to a foreign flag vessel within the jurisdiction
of the U.S., and because the invoice specified payment in the U.S., the admiralty and maritime law
of the U.S. applied. The U.S. Court of Appeals recognized the modern approach to maritime
conflict of law problems introduced in the Lauritzen case. However, it observed that Lauritzen
involved a torts claim under the Jones Act while the present claim involves an alleged maritime
lien arising from unpaid supplies. It made a disclaimer that its conclusion is limited to the unique
circumstances surrounding a maritime lien as well as the statutory directives found in the Maritime
Lien Statute and that the initial choice of law determination is significantly affected by the
statutory policies surrounding a maritime lien. It ruled that the facts in the case call for the
application of the Restatement (Second) of Conflicts of Law. The U.S. Court gave much
significance to the congressional intent in enacting the Maritime Lien Statute to protect the
interests of American supplier of goods, services or necessaries by making maritime liens
available where traditional services are routinely rendered. It concluded that the Maritime Lien
Statute represents a relevant policy of the forum that serves the needs of the international legal
system as well as the basic policies underlying maritime law. The court also gave equal
importance to the predictability of result and protection of justified expectations in a particular field
of law. In the maritime realm, it is expected that when necessaries are furnished to a vessel in an
American port by an American supplier, the American Lien Statute will apply to protect that
supplier regardless of the place where the contract was formed or the nationality of the vessel.
The same principle was applied in the case of Swedish Telecom Radio v. M/V
Discovery I[29] where the American court refused to apply the Federal Maritime Lien Act to create
a maritime lien for goods and services supplied by foreign companies in foreign ports. In this case,
a Swedish company supplied radio equipment in a Spanish port to refurbish a Panamanian vessel
damaged by fire. Some of the contract negotiations occurred in Spain and the agreement for
supplies between the parties indicated Swedish companys willingness to submit to Swedish law.
The ship was later sold under a contract of purchase providing for the application of New York law
and was arrested in the U.S. The U.S. Court of Appeals also held that while the contacts-based
framework set forth in Lauritzen was useful in the analysis of all maritime choice of law situations,
the factors were geared towards a seamans injury claim. As in Gulf Trading, the lien arose by
operation of law because the ships owner was not a party to the contract under which the goods
were supplied. As a result, the court found it more appropriate to consider the factors contained in
Section 6 of the Restatement (Second) of Conflicts of Law. The U.S. Court held that the primary
concern of the Federal Maritime Lien Act is the protection of American suppliers of goods and
services.
The same factors were applied in the case of Ocean Ship Supply, Ltd. v. M/V Leah.[30]
II.
Finding guidance from the foregoing decisions, the Court cannot sustain petitioner
Crescents insistence on the application of P.D. No. 1521 or the Ship Mortgage Decree of 1978
and hold that a maritime lien exists.
First. Out of the seven basic factors listed in the case of Lauritzen, Philippine law only
falls under one the law of the forum. All other elements are foreign Canada is the place of the
wrongful act, of the allegiance or domicile of the injured and the place of contract; India is the law
of the flag and the allegiance of the defendant shipowner. Balancing these basic interests, it is
inconceivable that the Philippine court has any interest in the case that outweighs the interests of
Canada or India for that matter.
Second. P.D. No. 1521 or the Ship Mortgage Decree of 1978 is inapplicable following the
factors under Restatement (Second) of Conflict of Laws. Like the Federal Maritime Lien Act of the
U.S., P.D. No. 1521 or the Ship Mortgage Decree of 1978 was enacted primarily to protect Filipino
suppliers and was not intended to create a lien from a contract for supplies between foreign
entities delivered in a foreign port.
Third. Applying P.D. No. 1521 or the Ship Mortgage Decree of 1978 and rule that a
maritime lien exists would not promote the public policy behind the enactment of the law to
develop the domestic shipping industry. Opening up our courts to foreign suppliers by granting
them a maritime lien under our laws even if they are not entitled to a maritime lien under their laws
will encourage forum shopping.
Finally. The submission of petitioner is not in keeping with the reasonable expectation of
the parties to the contract. Indeed, when the parties entered into a contract for supplies in Canada,
they could not have intended the laws of a remote country like the Philippines to determine the
creation of a lien by the mere accident of the Vessels being in Philippine territory.
III.
But under which law should petitioner Crescent prove the existence of its maritime lien?
In light of the interests of the various foreign elements involved, it is clear that Canada has the
most significant interest in this dispute. The injured party is a Canadian corporation, the sub-
charterer which placed the orders for the supplies is also Canadian, the entity which physically
delivered the bunker fuels is in Canada, the place of contracting and negotiation is in Canada, and
the supplies were delivered in Canada.
The arbitration clause contained in the Bunker Fuel Agreement which states that New
York law governs the construction, validity and performance of the contract is only a factor that
may be considered in the choice-of-law analysis but is not conclusive. As in the cases of Gulf
Trading and Swedish Telecom, the lien that is the subject matter of this case arose by operation
of law and not by contract because the shipowner was not a party to the contract under which the
goods were supplied.
It is worthy to note that petitioner Crescent never alleged and proved Canadian law as
basis for the existence of a maritime lien. To the end, it insisted on its theory that Philippine law
applies. Petitioner contends that even if foreign law applies, since the same was not properly
pleaded and proved, such foreign law must be presumed to be the same as Philippine law
pursuant to the doctrine of processual presumption.
Thus, we are left with two choices: (1) dismiss the case for petitioners failure to establish
a cause of action[31] or (2) presume that Canadian law is the same as Philippine law. In either
case, the case has to be dismissed.
It is well-settled that a party whose cause of action or defense depends upon a foreign
law has the burden of proving the foreign law. Such foreign law is treated as a question of fact to
be properly pleaded and proved.[32] Petitioner Crescents insistence on enforcing a maritime lien
before our courts depended on the existence of a maritime lien under the proper law. By
erroneously claiming a maritime lien under Philippine law instead of proving that a maritime lien
exists under Canadian law, petitioner Crescent failed to establish a cause of action. [33]
Even if we apply the doctrine of processual presumption, the result will still be the same.
Under P.D. No. 1521 or the Ship Mortgage Decree of 1978, the following are the requisites for
maritime liens on necessaries to exist: (1) the necessaries must have been furnished to and for
the benefit of the vessel; (2) the necessaries must have been necessary for the continuation of the
voyage of the vessel; (3) the credit must have been extended to the vessel; (4) there must be
necessity for the extension of the credit; and (5) the necessaries must be ordered by persons
authorized to contract on behalf of the vessel.[34] These do not avail in the instant case.
First. It was not established that benefit was extended to the vessel. While this is
presumed when the master of the ship is the one who placed the order, it is not disputed that in
this case it was the sub-charterer Portserv which placed the orders to petitioner
Crescent.[35] Hence, the presumption does not arise and it is incumbent upon petitioner Crescent
to prove that benefit was extended to the vessel. Petitioner did not.
Second. Petitioner Crescent did not show any proof that the marine products were
necessary for the continuation of the vessel.
Third. It was not established that credit was extended to the vessel. It is presumed that
in the absence of fraud or collusion, where advances are made to a captain in a foreign port, upon
his request, to pay for necessary repairs or supplies to enable his vessel to prosecute her voyage,
or to pay harbor dues, or for pilotage, towage and like services rendered to the vessel, that they
are made upon the credit of the vessel as well as upon that of her owners. [36] In this case, it was
the sub-charterer Portserv which requested for the delivery of the bunker fuels. The issuance of
two checks amounting to US$300,000 in favor of petitioner Crescent prior to the delivery of the
bunkers as security for the payment of the obligation weakens petitioner Crescents contention
that credit was extended to the Vessel.
We also note that when copies of the charter parties were submitted by respondents in
the Court of Appeals, the time charters between respondent SCI and Halla and between Halla
and Transmar were shown to contain a clause which states that the Charterers shall provide and
pay for all the fuel except as otherwise agreed. This militates against petitioner Crescents position
that Portserv is authorized by the shipowner to contract for supplies upon the credit of the vessel.
Fourth. There was no proof of necessity of credit. A necessity of credit will be presumed
where it appears that the repairs and supplies were necessary for the ship and that they were
ordered by the master. This presumption does not arise in this case since the fuels were not
ordered by the master and there was no proof of necessity for the supplies.
Finally. The necessaries were not ordered by persons authorized to contract in behalf of
the vessel as provided under Section 22 of P.D. No. 1521 or the Ship Mortgage Decree of 1978 -
the managing owner, the ships husband, master or any person with whom the management of the
vessel at the port of supply is entrusted. Clearly, Portserv, a sub-charterer under a time charter, is
not someone to whom the management of the vessel has been entrusted. A time charter is a
contract for the use of a vessel for a specified period of time or for the duration of one or more
specified voyages wherein the owner of the time-chartered vessel retains possession and control
through the master and crew who remain his employees.[37] Not enjoying the presumption of
authority, petitioner Crescent should have proved that Portserv was authorized by the shipowner
to contract for supplies. Petitioner failed.
A discussion on the principle of forum non conveniens is unnecessary.
IN VIEW WHEREOF, the Decision of the Court of Appeals in CA-G.R. No. CV 54920,
dated November 28, 2001, and its subsequent Resolution of September 3, 2002 are AFFIRMED.
The instant petition for review on certiorari is DENIED for lack of merit. Cost against petitioner.
SO ORDERED.
 SECOND DIVISION

[G.R. No. 97805. September 2, 1992.] This is a petition for certiorari and prohibition with restraining order and preliminary injunction to
annul and set aside the decision of the Court of Appeals dated March 11, 1991 1 dismissing
NILO H. RAYMUNDO, Petitioner, v. HON. COURT OF APPEALS, Sixteenth Division, Hon. petitioner’s petition for certiorari and prohibition which assailed the Orders 2 dated June 1, 1990 3
Judge, RTC, Br. 133, Makati, Metro Manila and GALLERIA DE MAGALLANES and June 29, 1990 4 of the trial court.chanrobles lawlibrary : rednad
ASSOCIATION, INC., Respondents.
It appears on record that on July 5, 1989, the administrator of the Galleria de Magallanes
The Barristers Law Office for Petitioner. Condominium discovered that petitioner Nilo Raymundo, who was an owner/occupant of Unit AB-
122 of said condominium, made an unauthorized installation of glasses at the balcony of his unit in
Leo M. Caubang for Respondents. violation of Article IV, Section 3 paragraph (d) of the Master Deed and Declaration of Restrictions
of the Association, which states that:jgc:chanrobles.com.ph

SYLLABUS "d. Nothing shall be done or placed in any unit or in the common areas which is beyond or will
impair the structural strength of the buildings or alter the original architecture, appearance and
specifications of the building, including the external facade thereof." 5
1. REMEDIAL LAW; REGIONAL TRIAL COURT; JURISDICTION IN CIVIL CASES NOT
CAPABLE OF PECUNIARY ESTIMATION. — Private respondent’s complaint is an action to Thereafter, the administrator of said condominium reported said violation to the Board of Directors
compel the petitioner to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the private respondent Galleria de Magallanes Association, Inc. in a special meeting held on
of the condominium which is not capable of pecuniary estimation and falls under the exclusive July 8, 1989 and the former sent a letter dated July 12, 1989 6 to the petitioner demanding the
jurisdiction of the Regional Trial Court Section 33 of Batas Pambansa Bilang 129 is not applicable latter to remove the illegal and unauthorized installation of glasses at his unit.
in the instant case, but paragraph (1), Section 19 and paragraph (1), Section 21.
Petitioner refused, consequently, private respondent filed a complaint for mandatory injunction
2. ID; ID.; ID.; CRITERION IN DETERMINING WHETHER AN ACTION IS ONE THE SUBJECT against petitioner on February 21, 1990 with the Regional Trial Court of Makati, Branch 133 in Civil
MATTER OF WHICH IS NOT CAPABLE OF PECUNIARY ESTIMATION. — A civil action in which Case No. 90-490.
the subject of the litigation is incapable of pecuniary estimation has invariably been held to be
within the exclusive original jurisdiction of the Regional Trial Courts. "In determining whether an On March 12, 1990, petitioner filed a Motion for extension of time to file an Answer 7 as well as a
action is one the subject matter of which is not capable of pecuniary estimation this Court has Motion for production of document 8 which were granted in an Order dated March 16, 1990. 9
adopted the criterion of first ascertaining the nature of the principal action or remedy sought. If it is
primarily for the recovery of a sum of money, the claim is considered capable of pecuniary However, on March 23, 1990, instead of an Answer, petitioner filed a Motion to Dismiss with the
estimation, and whether jurisdiction is in the municipal courts [now municipal trial courts] or in the trial court on the ground that said court has no jurisdiction over the present case since a complaint
courts of first instance [now regional trial courts] would depend on the amount of the claim. for mandatory injunction is within the exclusive original jurisdiction of the Metropolitan Trial
However, where the basic issue is something other than the right to recover a sum of money, or Court.chanrobles virtual lawlibrary
where the money claim is purely incidental to, or a consequence of, the principal relief sought, this
Court has considered such actions as cases where the subject of the litigation may not be The Motion to Dismiss was denied in the Order of June 1, 1990, the pertinent portion of which
estimated in terms of money, and are cognizable exclusively by courts of first instance [now reads:jgc:chanrobles.com.ph
regional trial courts]."cralaw virtua1aw library
"This is a suit for mandatory injunction. Under Sec. 21 of BP 129, as amended, it is the Regional
3. ID.; PROVISIONAL REMEDIES; WRIT OF MANDATORY INJUNCTION; WHEN AVAILABLE. Trial Court which has the legal competence to issue the same. Corollarily, the second ground must
— A writ for mandatory injunction is a provisional remedy. It is provisional because it constitutes a be denied. The action is essentially one which falls within the jurisdiction of the Regional Trial
temporary measure availed of during the pendency of the main action and it is ancillary because it Court.
is a mere incident in and is dependent upon the result of the main action.
"WHEREFORE, the Motion to Dismiss is hereby denied, for lack of merit." 10

DECISION Likewise, petitioner’s Motion for Reconsideration was denied in the Order of June 29, 1990 which
We quote, to wit:jgc:chanrobles.com.ph

NOCON, J.: "As denominated in the complaint itself, this is a suit for mandatory injunction, and the nature of
the action as designated by the plaintiff is substantiated by the allegations of the complaint itself.
Such being the case, Sec. 21 of BP 129 governs. The claims for attorney’s fees is incidental to the recover a sum of money, or where the money claim is purely incidental to, or a consequence of,
nature of the complaint as one of mandatory injunction which is also attested by the prayer in the the principal relief sought, this Court has considered such actions as cases where the subject of
complaint "to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the the litigation may not be estimated in terms of money, and are cognizable exclusively by courts of
Condominium within five (5) days from receipt of the order . . ." and, therefore, does not affect the first instance [now regional trial courts]." 12
legal competence of the Court to act on the complaint." 11
As correctly stated by the Court of Appeals, the question for resolution is whether or not the
On elevation to the appellate court in a petition for certiorari and prohibition with restraining order petitioner violated the provisions of the Master Deed and Declaration of Restriction of the
and preliminary injunction, the petition was again dismissed on March 11, corporation, and if so, to remove the illegal and unauthorized installation of glasses at Unit AB-122
1991.chanrobles.com.ph : virtual law library of the Condominium. Clearly, the issue is incapable of pecuniary estimation.

Hence, this petition alleging want of jurisdiction of the trial court to hear and decide private In the instant case. the claim of attorney’s fees by the private respondent in the amount of
respondent’s complaint for mandatory injunction considering that private respondent’s sole P10,000.00 is only incidental to its principal cause of action which is for the removal of the illegal
pecuniary claim of P10,000.00 as attorney’s fees in Civil Case No. 90-490 is within the original and unauthorized installation of the glasses made by the petitioner and therefore, said amount is
and exclusive jurisdiction of the Metropolitan Trial Court as provided for under Section 33 of B.P. not determinative of the jurisdiction of the court.
129.
Note should be taken. however, that the trial court had erroneously considered the complaint as
We do not agree. one for mandatory injunction, misled perhaps by the caption of the
complaint.chanrobles.com:cralaw:red
The contention of the petitioner is devoid of merit because private respondent’s complaint is an
action to compel the petitioner to remove the illegal and unauthorized installation of glasses at Unit A writ for mandatory injunction is a provisional remedy. It is provisional because it constitutes a
AB-122 of the condominium which is not capable of pecuniary estimation and falls under the temporary measure availed of during the pendency of the main action and it is ancillary because it
exclusive jurisdiction of the Regional Trial Court Section 33 of Batas Pambansa Bilang 129 is not is a mere incident in and is dependent upon the result of the main action. 13
applicable in the instant case, but paragraph (1), Section 19 and paragraph (1), Section 21 of said
law which provide:jgc:chanrobles.com.ph WHEREFORE, the petition for certiorari and prohibition with restraining order and preliminary
injunction is hereby DISMISSED for lack of merit and the decision of the Court of Appeals
"Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive original promulgated on March 11, 1991 is hereby AFFIRMED.
jurisdiction:chanrob1es virtual 1aw library
SO ORDERED.
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;"

x x x

"Sec. 21. Original jurisdiction in other cases. — Regional Trial Courts shall exercise original
jurisdiction:chanrob1es virtual 1aw library

(1) In the issuance of writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and
injunction which may be enforced in any part of their respective regions;"

A civil action in which the subject of the litigation is incapable of pecuniary estimation has
invariably been held to be within the exclusive original jurisdiction of the Regional Trial
Courts.chanrobles law library

"In determining whether an action is one the subject matter of which is not capable of pecuniary
estimation this Court has adopted the criterion of first ascertaining the nature of the principal
action or remedy sought. If it is primarily for the recovery of a sum of money, the claim is
considered capable of pecuniary estimation, and whether jurisdiction is in the municipal courts
[now municipal trial courts] or in the courts of first instance [now regional trial courts] would depend
on the amount of the claim. However, where the basic issue is something other than the right to
 Republic of the Philippines On November 24, 1994, private respondents filed a Motion to Dismiss 2 the complaint on the
SUPREME COURT ground of lack of jurisdiction over the nature of the case as the total assessed value of the subject
Manila land is P5,000.00 which under section 33 (3) 3 of Batas Pambansa Blg. 129, as amended by R.A.
No. 7691, 4 falls within the exclusive jurisdiction of the Municipal Circuit Trial Curt of Liloan,
FIRST DIVISION Compostela. 5

Petitioners filed an Opposition to the Motion to Dismiss 6 saying that the Regional Trial Court has
jurisdiction over the case since the action is one which is incapable of pecuniary estimation within
the contemplation of Section 19(1) of B.P. 129, as amended. 7
G.R. No. 119347 March 17, 1999

On January 12, 1995, the respondent judge issued an Order granting the Motion to Dismiss. 8 A
EULALIA RUSSELL, PUPERTO TAUTHO, FRANCISCO TAUTHO, SUSANA T. REALES,
Motion for Reconsideration of said order was filed by petitioners on January 30, 1995 alleging that
APITACIO TAUTHO, DANILO TAUTHO, JUDITHA PROS, GREGORIO TAUTHO, DEODITA T.
the same is contrary to law because their action is not one for recovery of title to or possession of
JUDILLA, AGRIPINO TAUTHO, FELIX TAUTHO, WILLIAM TAUTHO, AND MARILYN
the land but an action to annul a document or declare it null and void, 9 hence, one incapable of
PERALES, petitioners,
pecuniary estimation falling within the jurisdiction of the Regional Trial Court. Private respondents
vs. did not oppose the motion for reconsideration.
HONORABLE AUGUSTINE A. VESTlL, ADRIANO TAGALOG, MARCELO TAUTHO, JUANITA
MENDOZA, DOMINGO BANTILAN, RAUL BATALUNA AND ARTEMIO
CABATINGAN, respondent. On February 13, 1995, the respondent judge issued another Order denying the motion for
reconsideration. 10

Hence, this petition wherein the sole issue raised is whether or not the Regional Trial Court has
jurisdiction to entertain Civil Case No. MAN-2275.
KAPUNAN, J.:
We find merit in the petition.
Before us is a Petition for Certiorari to set aside the Order dated January 12, 1995 issued by
respondent Judge Augustine A. Vestil of the Regional Trial Court of Mandaue City, Branch 56,
dismissing the complaint filed by petitioners on ground of lack of jurisdiction, as well as his Order Petitioners maintain the view that the complaint filed before the Regional Trial Court is for the
dated February 13, 1995 denying petitioners' Motion for Reconsideration of the order of dismissal. annulment of a document denominated as "DECLARATION OF HEIRS AND DEED OF
CONFIRMATION OF PREVIOUS ORAL PARTITION," which is clearly one incapable of pecuniary
estimation, thus, cognizable by the Regional Trial Court.
The facts of the case are as follows:
Private respondents, on the other hand, insists that the action is one for re-partition and since the
On September 28, 1994, petitioners filed a complaint against private respondents, denominated assessed value of the property as stated in the complaint is P5,000.00, then, the case falls within
"DECLARATION OF NULLITY AND PARTITION," with the Regional Trial Court of Mandaue City, the jurisdiction of the Municipal Circuit Trial Court of Liloan, Compostela, Cebu.
Branch 56, docketed as Civil Case No. MAN-2275. The complaint, in substance, alleged that
petitioners are co-owners of that parcel of land, Lot 6149 situated in Liloan, Cebu and containing
an area of 56,977.40 square meters, more or less. The land was previously owned by the spouses For better appreciation of the facts, the pertinent portions of the complaint are reproduced
Casimero Tautho and Cesaria Tautho. Upon the death of said spouses, the property was inherited hereunder:
by their legal heirs, herein petitioners and private respondents. Since then, the lot had remained
undivided until petitioners discovered a public document denominated "DECLARATION OF xxx xxx xxx
HEIRS AND DEED OF CONFIRMATION OF A PREVIOUS ORAL AGREEMENT OF
PARTITION," executed on June 6, 1990. By virtue of this deed, private respondents divided the 3. That the plaintiffs and the defendants are the legal heirs of spouses Casimero
property among themselves to the exclusion of petitioners who are also entitled to the said lot as Tautho and Cesaria N. Tautho who died long time ago;
heirs of the late spouses Casimero Tautho and Cesaria Tautho. Petitioners claimed that the
document was false and perjurious as the private respondents were not the only heirs and that no
4. That in life the spouses became the owners in fee simple of a certain parcel of
oral partition of the property whatsoever had been made between the heirs. The complaint prayed
land, which is more particularly described as follows:
that the document be declared null and void and an order be issued to partition the land among all
the heirs. 1
 A parcel of land containing 56,97740 square meters, more or
less, located at Cotcot, Liloan, Cebu.
designated as Lot 6149 per Technical Description and Certification issued by the
Office of the Land Management copy of which are hereto attached as Annexes
"A" and "A-1" and are made part hereof: total assessed value is P5,000.00;
5. That the passed to the children of the spouses (who are all deceased except
for defendant Marcelo Tautho), namely: Zacarias, Epifania, Vicenta, Felecisimo,
Maria, Lorencia and Marcelo, and which in turn passed to the plaintiffs and
defendants upon their death they being their descendants and legal heirs;
6. That the subject parcel of land has for year been undivided by and among the
legal heirs of said previous owners;
7. That, very recently, plaintiffs discovered a public document, which is a
declaration of heirs and deed of confirmation of a previous oral agreement of
partition, affecting the land executed by and among the defendants whereby
defendants divided the property among themselves to the exclusion of plaintiffs
who are entitled thereto; attached hereto as Annex "B" and is made part hereof is
xerox copy of said document;
8. That the instrument (Annex "B") is false and perjurious and is a complete
nullity because the defendants are not the only heirs of Casimero Tautho;
plaintiffs are also heirs and descendants of said deceased; moreover, there has
been no oral partition of the property;
9. That pursuant to said document (Annex "B"), defendants had procured tax
declarations of the land for their supposed "shares" to the great damage and
prejudice of plaintiffs;
10. That the property in controversy should be divided into seven (7) equal parts
since Casimero Tautho and Cesaria N. Tautho had seven children;
11. That the parties had failed to settle the controversy amicably at the barangay
level; attached hereto as Annex "C" is Certification to file Action;
12. That by reason of the foregoing unjust and illegal act of defendants, plaintiffs
were forced to bring instant action and contract the services of the undersigned
counsel with whom they bind themselves to pay P30,000.00 as attorney's fees.
WHEREFORE, it is most respectfully prayed of this Honorable Court to declare
null and void the document (Annex "B") of declaration of heirs and confirmation
and to order the partition of the land into seven (7) equal parts; each part shall
respectively go to the seven (7) children of Casimero Tautho and considering six
(6) of them died already the same shall go to their children or descendants, and
to order the defendants to pay plaintiffs attorney's fees in the amount of
P30,000.00.
Plaintiffs further pray for such other reliefs and remedies just and equitable under
the premises. 11
We agree with petitioners.
The complaint filed before the Regional Trial Court is doubtless one incapable of
pecuniary estimation and therefore within the jurisdiction of said court.
In Singsong vs. Isabela Sawmill, 12 we had the occasion to rule that:
[I]n determining whether an action is one the subject matter of which is not
capable of pecuniary estimation this Court has adopted the criterion of first
ascertaining the nature of the principal action or remedy sought. If it is primarily
for the recovery of a sum of money, the claim is considered capable of pecuniary
estimation, and whether jurisdiction is in the municipal courts or in instance would
depend on the amount of the claim. However, where the basic issue is something
other than the right to recover a sum of money, where the money claim is purely
incidental to, or a consequence of, the principal relief sought, this Court has
considered such where the subject of the litigation may not be estimated in terms
of money, and are cognizable exclusively by courts of first instance (now
Regional Trial Courts). 13
Examples of actions incapable of pecuniary estimation are those for specific performance,
support, or foreclosure of mortgage or annulment of judgment; 14 also actions questioning the
validity of a mortgage, 15 annulling a deed of sale or conveyance and to recover the price
paid 16 and for rescession, which is a counterpart of specific performance. 17
While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary estimation, the law
specifically mandates that they are cognizable by the MTC, METC, or MCTC where the assessed
value of the real property involved does exceed P20,000.00 in Metro Manila, or P50,000.00, if
located elsewhere. If the value exceeds P20,000.00 or P50,000.00 as the case may be, it is the
Regional Trial Courts which have jurisdiction under Sec. 19(2). 18 However, the subject matter of
the complaint in this case is annulment of a document denominated as "DECLARATION OF
HEIRS AND DEED OF CONFIRMATION OF PREVIOUS ORAL PARTITION."
The main purpose of petitioners in filing the complaint is to declare null and void the document in
which private respondents declared themselves as the only heirs of the late spouses Casimero
Tautho and Cesaria Tautho and divided his property among themselves to the exclusion of
petitioners who also claim to be legal heirs and entitled to the property. While the complaint also
prays for the partition of the property, this is just incidental to the main action, which is the
declaration of nullity of the document above-described. It is axiomatic that jurisdiction over the
subject matter of a case is conferred by law and is determined by the allegations in the complaint
and the character of the relief sought, irrespective of whether the plaintiff is entitled to all or some
of the claims asserted therein. 19
WHEREFORE, premises considered, the petition is hereby GRANTED. The Order dismissing Civil
Case No. MAN-2275, as well as the Order denying the motion for reconsideration of said Order, is
SET ASIDE.

The Regional Trial Court, Branch 56, Mandaue City is ORDERED to proceed with dispatch in
resolving Civil Case No. MAN-2275. No costs.

SO ORDERED.
 THIRD DIVISION
[G.R. No. 146886. April 30, 2003]
DEVORAH E. BARDILLON, petitioner, vs. BARANGAY MASILI of Calamba,
Laguna, respondent.
DECISION
PANGANIBAN, J.:
An expropriation suit is incapable of pecuniary estimation. Accordingly, it falls within the
jurisdiction of regional trial courts, regardless of the value of the subject property.
The Case
Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to set aside
the January 10, 2001 Decision and the February 5, 2001 Resolution of the Court of Appeals[2] (CA)
in CA-GR SP No. 61088. The dispositive part of the Decision reads:
WHEREFORE, premises considered, the present [P]etition for [C]ertiorari is hereby DENIED DUE
COURSE and accordingly DISMISSED, for lack of merit.[3]
The assailed Resolution[4] denied petitioners Motion for Reconsideration.
The Facts
The factual antecedents are summarized by the CA as follows:
At the root of this present [P]etition is the controversy surrounding the two (2) [C]omplaints for
eminent domain which were filed by herein respondent for the purpose of expropriating a ONE
HUNDRED FORTY FOUR (144) square meter-parcel of land, otherwise known as Lot 4381-D
situated in Barangay Masili, Calamba, Laguna and owned by herein petitioner under Transfer
Certificate of Title No. 383605 of the Registry of Deeds of Calamba, Laguna. Petitioner acquired
from Makiling Consolidated Credit Corporation the said lot pursuant to a Deed of Absolute
Sale which was executed by and between the former and the latter on October 7, 1996.
The first [C]omplaint for eminent domain, docketed as Civil Case No. 3648 and entitled Brgy.
Masili, Calamba, Laguna v. Emelita A. Reblara, Eugenia Almazan & Devorah E.
Bardillon, was filed before the Municipal Trial Court of Calamba, Laguna (MTC) on February 23,
1998, following the failure of Barangay Masili to reach an agreement with herein petitioner on the
purchase offer of TWO HUNDRED THOUSAND PESOS (P200,000.00). The expropriation of Lot
4381-D was being pursued in view of providing Barangay Masili a multi-purpose hall for the use
and benefit of its constituents.
On March 5, 1999, the MTC issued an order dismissing Civil Case No. 3648 for lack of interest for
failure of the [respondent] and its counsel to appear at the pre-trial. The MTC, in its Order dated
May 3, 1999, denied [respondents] [M]otion for [R]econsideration thereof.
The second [C]omplaint for eminent domain, docketed as Civil Case No. 2845-99-C and
entitled Brgy. Masili, Calamba, Laguna v. Devorah E. Bardillon, was filed before Branch 37 of
the Regional Trial Court of Calamba, Laguna (RTC) on October 18, 1999. This [C]omplaint also
sought the expropriation of the said Lot 4381-D for the erection of a multi-purpose hall of
Barangay Masili, but petitioner, by way of a Motion to Dismiss, opposed this [C]omplaint by
alleging in the main that it violated Section 19(f) of Rule 16 in that [respondents] cause of action is
barred by prior judgment, pursuant to the doctrine of res judicata.
On January 21, 2000, [the] Judge issued an order denying petitioners Motion to Dismiss, holding
that the MTC which ordered the dismissal of Civil Case No. 3648 has no jurisdiction over the said
expropriation proceeding.
With the subsequent approval of Municipal Ordinance No. 2000-261 on July 10, 2000, and the
submission thereof in compliance with [the] Judges Order dated June 9, 2000 requiring herein
respondent to produce the authority for the expropriation through the Municipal Council of
Calamba, Laguna, the assailed Order dated August 4, 2000 was issued in favor of Barangay
Masili x x x and, on August 16, 2000, the corresponding order for the issuance of the [W]rit of
[P]ossession over Lot 4381-D.[5]
Ruling of the Court of Appeals
In dismissing the Petition, the CA held that the Regional Trial Court (RTC) of Calamba,
Laguna (Branch 37)[6] did not commit grave abuse of discretion in issuing the assailed Orders. It
ruled that the second Complaint for eminent domain (Civil Case No. 2845-99-C) was not barred
by res judicata. The reason is that the Municipal Trial Court (MTC), which dismissed the first
Complaint for eminent domain (Civil Case No. 3648), had no jurisdiction over the action.
Hence, this Petition.[7]
The Issues
 In her Memorandum, petitioner raises the following issues for our consideration:
A. Whether or not, the Honorable Respondent Court committed grave abuse of discretion
amounting to lack of jurisdiction when it denied and dismissed petitioners appeal;
B. Whether or not, the Honorable Respondent Court committed grave abuse of discretion when it
did not pass upon and consider the pending Motion for Reconsideration which was not resolved
by the Regional Trial Court before issuing the questioned Orders of 4 and 16 August 2000;
C. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in taking
the total amount of the assessed value of the land and building to confer jurisdiction to the court a
quo;
D. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in
ignoring the fact that there is an existing multi-purpose hall erected in the land owned by Eugenia
Almazan which should be subject of expropriation; and
E. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in failing
to consider the issue of forum shopping committed by Respondent Masili.[8]
Simply put, the issues are as follows: (1) whether the MTC had jurisdiction over the
expropriation case; (2) whether the dismissal of that case before the MTC constituted res judicata;
(3) whether the CA erred when it ignored the issue of entry upon the premises; and (4) whether
respondent is guilty of forum shopping.
The Courts Ruling
The Petition has no merit.
First Issue:
Jurisdiction Over Expropriation
Petitioner claims that, since the value of the land is only P11,448, the MTC had jurisdiction
over the case.[9]
On the other hand, the appellate court held that the assessed value of the property
was P28,960.[10] Thus, the MTC did not have jurisdiction over the expropriation proceedings,
because the amount involved was beyond the P20,000 jurisdictional amount cognizable by MTCs.
An expropriation suit does not involve the recovery of a sum of money. Rather, it deals with
the exercise by the government of its authority and right to take property for public use.[11] As such,
it is incapable of pecuniary estimation and should be filed with the regional trial courts.[12]
This was explained by the Court in Barangay San Roque v. Heirs of Francisco Pastor:[13]
It should be stressed that the primary consideration in an expropriation suit is whether the
government or any of its instrumentalities has complied with the requisites for the taking of private
property. Hence, the courts determine the authority of the government entity, the necessity of the
expropriation, and the observance of due process. In the main, the subject of an expropriation suit
is the governments exercise of eminent domain, a matter that is incapable of pecuniary estimation.
True, the value of the property to be expropriated is estimated in monetary terms, for the court is
duty-bound to determine the just compensation for it. This, however, is merely incidental to the
expropriation suit.Indeed, that amount is determined only after the court is satisfied with the
propriety of the expropriation.
Verily, the Court held in Republic of the Philippines v. Zurbano that condemnation proceedings are
within the jurisdiction of Courts of First Instance, the forerunners of the regional trial courts. The
said case was decided during the effectivity of the Judiciary Act of 1948 which, like BP 129 in
respect to RTCs, provided that courts of first instance had original jurisdiction over all civil actions
in which the subject of the litigation is not capable of pecuniary estimation. The 1997 amendments
to the Rules of Court were not intended to change these jurisprudential precedents.[14]
To reiterate, an expropriation suit is within the jurisdiction of the RTC regardless of the value
of the land, because the subject of the action is the governments exercise of eminent domain -- a
matter that is incapable of pecuniary estimation.
Second Issue:
Res Judicata
Petitioner claims that the MTCs dismissal of the first Complaint for eminent domain was with
prejudice, since there was no indication to the contrary in the Order of dismissal. She contends
that the filing of the second Complaint before the RTC should therefore be dismissed on account
of res judicata.
Res judicata literally means a matter adjudged, judicially acted upon or decided, or settled by
judgment.[15] It provides that a final judgment on the merits rendered by a court of competent
jurisdiction is conclusive as to the rights of the parties and their privies; and constitutes an
absolute bar to subsequent actions involving the same claim, demand or cause of action.[16]
The following are the requisites of res judicata: (1) the former judgment must be final; (2) the
court that rendered it had jurisdiction over the subject matter and the parties; (3) it is a judgment
on the merits; and (4) there is -- between the first and the second actions -- an identity of parties,
subject matter and cause of action.[17]
Since the MTC had no jurisdiction over expropriation proceedings, the doctrine of res
judicata finds no application even if the Order of dismissal may have been an adjudication on the
merits.
Third Issue:
Legality of Entry Into Premises

Petitioner argues that the CA erred when it ignored the RTCs Writ of Possession over her
property, issued despite the pending Motion for Reconsideration of the ruling dismissing the
Complaint.We are not persuaded.
The requirements for the issuance of a writ of possession in an expropriation case are
expressly and specifically governed by Section 2 of Rule 67 of the 1997 Rules of Civil
Procedure.[18] On the part of local government units, expropriation is also governed by Section 19
of the Local Government Code.[19] Accordingly, in expropriation proceedings, the requisites for
authorizing immediate entry are as follows: (1) the filing of a complaint for expropriation sufficient
in form and substance; and (2) the deposit of the amount equivalent to 15 percent of the fair
market value of the property to be expropriated based on its current tax declaration.[20]
In the instant case, the issuance of the Writ of Possession in favor of respondent after it had
filed the Complaint for expropriation and deposited the amount required was proper, because it
had complied with the foregoing requisites.
The issue of the necessity of the expropriation is a matter properly addressed to the RTC in
the course of the expropriation proceedings. If petitioner objects to the necessity of the takeover of
her property, she should say so in her Answer to the Complaint. [21] The RTC has the power to
inquire into the legality of the exercise of the right of eminent domain and to determine whether
there is a genuine necessity for it.[22]

Fourth Issue:
Forum Shopping

Petitioner claims that respondent is guilty of forum shopping, because it scouted for another
forum after obtaining an unfavorable Decision from the MTC.
The test for determining the presence of forum shopping is whether the elements of litis
pendentia are present in two or more pending cases, such that a final judgment in one case will
amount to res judicata in another.[23]
Be it noted that the earlier case lodged with the MTC had already been dismissed when the
Complaint was filed before the RTC. Even granting arguendo that both cases were still pending, a
final judgment in the MTC case will not constitute res judicata in the RTC, since the former had no
jurisdiction over the expropriation case.
WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against
petitioner.
SO ORDERED.
 Republic of the Philippines On October 26, 1998, Payoyo filed a complaint for recovery of a sum of money and damages
SUPREME COURT against Villena. Villena moved to dismiss the complaint for failure to state a cause of action. He
Manila argued that there was no ground to cancel the contract; thus, there was no basis for refund. The
trial court denied his motion. Villena thereafter filed an answer with compulsory counterclaim citing
SECOND DIVISION as an affirmative defense Payoyo’s failure to state a cause of action.

G.R. No. 163021 April 27, 2007 On June 1, 1999, immediately after the trial court issued a pre-trial order, Villena filed a second
motion to dismiss on the ground of lack of jurisdiction over the subject matter but it was denied.
Thereafter, trial ensued.
PATRICIO A. VILLENA, Petitioner,
vs.
PATRICIO S. PAYOYO, Respondent. The trial court decided in favor of Payoyo, reasoning that the power to rescind is implied in
reciprocal obligations. Considering that Villena repeatedly failed to comply with his obligation,
Payoyo had the right to rescind the contract and demand a refund. The trial court ordered
DECISION
petitioner to pay respondent ₱184,821.50 as actual damages plus 12% interest per annum from
the date of filing of the complaint and ₱20,000 as moral damages plus legal interest from judicial
QUISUMBING, J.: demand until fully paid.

This petition for review on certiorari assails the Decision1 dated November 21, 2003 of the Court of The Court of Appeals affirmed the RTC decision with the following modifications:
Appeals in CA-G.R. CV No. 70513 and its Resolution2 dated March 18, 2004, denying petitioner’s
motion for reconsideration. The appellate court had affirmed with modification the Decision 3 dated
1) [Petitioner Villena is] hereby ordered to pay [respondent Payoyo] actual damages in
April 26, 2000 of the Regional Trial Court (RTC) of Quezon City, Branch 78.
the amount of ₱ 155,183.00 with 12% interest per annum from the date of the filing of the
complaint;
The facts are undisputed.
2) [Petitioner is] likewise ordered to deliver the Indesit Multifunction Oven and Indesit Hob
On October 28, 1997, respondent Patricio Payoyo and Novaline, Inc., through its president, in favor of [respondent] within thirty (30) days from the finality of this decision; and
petitioner Patricio Villena, entered into a contract for the delivery and installation of kitchen
cabinets in Payoyo’s residence. The cabinets were to be delivered within ninety days from
3) [Respondent] is hereby ordered to pay the purchase price of the Indesit Multifunction
downpayment of 50% of the purchase price. On October 29, 1997, Payoyo paid Villena ₱155,183 Oven and Indesit Hob in favor of [petitioner] on the day the delivery is made.4
as downpayment.
The appellate court reasoned that while there was delay in the delivery and installation of the
On December 9, 1997, Payoyo entered into another contract with Villena for the delivery of home kitchen cabinets, there was none in the delivery of the appliances. The contract for said
appliances. On the same day, Payoyo paid 50% of the purchase price equal to ₱29,638.50 as appliances did not specify the date of delivery but that delivery should be made upon payment of
downpayment.
the 50% balance of the purchase price. Considering that Payoyo failed to pay the balance, Villena
did not incur delay.
However, Villena failed to install the kitchen cabinets and deliver the appliances. Payoyo made
several demands upon Villena but the latter failed to comply.
Hence, the instant petition, where petitioner raises the following issues:

In a letter dated March 12, 1998, Payoyo demanded the cancellation of the contracts and the I.
refund in full of the downpayments amounting to ₱184,821.50. Villena promised to install the
kitchen cabinets on or before May 10, 1998 and to deliver the appliances. Despite repeated
demands, Villena again failed to do so. WHETHER OR NOT THE TRIAL COURT HAD JURISDICTION OVER THE SUBJECT MATTER
OF THE CASE.
Payoyo sent Villena two demand letters on June 24, 1998 and on July 28, 1998 asking the latter to
either deliver all items or return the downpayments. II.
WHETHER OR NOT [THE] DEFENDANTS-APPELLANTS (PETITIONER AND NOVALINE, INC.),
ARE ESTOPPED FROM QUESTIONING THE JURISDICTION OF THE COURT UNDER THE
CIRCUMSTANCES.5
Simply, the issue in this case is whether the trial court had jurisdiction over the complaint.
Petitioner maintains that the RTC should have dismissed the complaint for lack of jurisdiction. He
posits that the RTC has no jurisdiction over the complaint since it is mainly for recovery of a sum
of money in the amount of ₱184,821.50 which is below the jurisdictional amount set for
RTCs.6 Moreover, petitioner contends that the issue of jurisdiction may be raised at any time, even
on appeal, since jurisdiction is conferred only by law and cannot be acquired through or waived by
any act or omission of the parties.7
Respondent, on the other hand, contends that the RTC has jurisdiction over the complaint as the
allegations therein show that it is actually a case for rescission of the contracts. The recovery of a
sum of money is merely a necessary consequence of the cancellation of the contracts.8
The pertinent portion of Section 19 of Batas Pambansa Bilang 129, as amended by Republic Act
No. 7691,9provides:
SEC. 19. Jurisdiction in civil cases.—Regional Trial Courts shall exercise exclusive original
jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;
xxxx
(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind,
attorney’s fees, litigation expenses, and costs or the value of the property in controversy exceeds
One Hundred Thousand pesos (P100,000.00) or, in such other cases in Metro Manila, where the
demand, exclusive of the abovementioned items exceeds Two Hundred Thousand pesos
(P200,000.00).
In determining the jurisdiction of an action whose subject is incapable of pecuniary estimation, the
nature of the principal action or remedy sought must first be ascertained. If it is primarily for the
recovery of a sum of money, the claim is considered capable of pecuniary estimation and the
jurisdiction of the court depends on the amount of the claim. But, where the primary issue is
something other than the right to recover a sum of money, where the money claim is purely
incidental to, or a consequence of, the principal relief sought, such are actions whose subjects are
incapable of pecuniary estimation, hence cognizable by the RTCs.10
Verily, what determines the nature of the action and which court has jurisdiction over it are the
allegations of the complaint and the character of the relief sought.11
In our considered view, the complaint, albeit entitled as one for collection of a sum of money with
damages, is one incapable of pecuniary estimation; thus, one within the RTC’s jurisdiction. The
allegations therein show that it is actually for breach of contract, thus,
xxxx
7. Under their Contracts, prestation and/or delivery of the items will be performed and delivered
within NINETY (90) DAYS from the receipt of downpayment. Plaintiff complied with its prestation
but defendants defaulted with their obligation;
xxxx
10. On 12 March 1998, plaintiff sent letter to defendants requesting the latter for the cancellation
of the purchase contracts and refund in full the (50%) downpayment paid in the total amount of (P
184, 821.50) within five (5) days upon receipt of the letter…
xxxx
12. On 24 March 1998, plaintiff and defendant Patricio A. Villena, personally talked [to] each other
regarding the full refund of the (50%) downpayment in the amount of P 184, 821.50. Defendant
informed the plaintiff that it was their fault because the order from their Australian supplier was
made only on 15 December 1997. Defendant promised plaintiff [delivery of] the three (3) Kitchen
Cabinets on or before 10 [M]ay 1998, and the three (3) home appliances were considered fully
paid applying the (50%) downpayment of (P 29,638.50) for home appliances only. But defendant
did not fulfill his promise;
13. Despite all these, repeated demands for the installation of the (3) three kitchen [c]abinets and
complete delivery of home appliances were made, but defendants did nothing;
x x x x12 (Emphasis added.)
A case for breach of contract is a cause of action either for specific performance or rescission of
contracts.13 An action for rescission of contract, as a counterpart of an action for specific
performance, is incapable of pecuniary estimation, and therefore falls under the jurisdiction of the
RTC.14 In the present case, the averments in the complaint show that Payoyo sought the
cancellation of the contracts and refund of the downpayments since Villena failed to comply with
the obligation to deliver the appliances and install the kitchen cabinets subject of the contracts.
The court then must examine the facts and the applicable law to determine whether there is in fact
substantial breach that would warrant rescission or cancellation of the contracts and entitle the
respondent for a refund. While the respondent prayed for the refund, this is just incidental to the
main action, which is the rescission or cancellation of the contracts.
WHEREFORE, the petition is DENIED for lack of merit. The Decision dated November 21, 2003 of
the Court of Appeals in CA-G.R. CV No. 70513 and the Resolution dated March 18, 2004 are
AFFIRMED.
Costs against petitioner.

SO ORDERED.
 Republic of the Philippines SO ORDERED[,]2
SUPREME COURT
Manila which Decision was, on motion for reconsideration, the Court voting 4-1,3 reversed by Resolution
of August 4, 2009, the dispositive portion of which reads:
EN BANC
WHEREFORE, in view of the foregoing, the Motion for Reconsideration filed by John Lu Ym and
G.R. No. 153690 February 15, 2011 Ludo & LuYm Development Corporation is GRANTED. The Decision of this Court dated August
26, 2008 is RECONSIDERED and SET ASIDE. The Complaint in SRC Case No. 021-CEB, now
DAVID LU, Petitioner, on appeal with the Court of Appeals in CA-G.R. CV No. 81163, is DISMISSED.
vs.
PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM, JOHN LU YM, KELLY LU YM, All interlocutory matters challenged in these consolidated petitions are DENIED for being moot
and LUDO & LUYM DEVELOPMENT CORPORATION, Respondents. and academic.

x - - - - - - - - - - - - - - - - - - - - - - -x SO ORDERED.4

G.R. No. 157381 David Lu’s Motion for Reconsideration and Motion to Refer Resolution to the Court En Banc was
denied by minute Resolution of September 23, 2009.
PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM, JOHN LU YM, KELLY LU YM,
and LUDO & LUYM DEVELOPMENT CORPORATION, Petitioners, Following his receipt on October 19, 2009 of the minute Resolution, David Lu personally filed on
vs. October 30, 2009 a Second Motion for Reconsideration and Motion to Refer Resolution to the
DAVID LU, Respondent. Court En Banc. On even date, he filed through registered mail an "Amended Second Motion for
Reconsideration and Motion to Refer Resolution to the Court En Banc." And on November 3,
x - - - - - - - - - - - - - - - - - - - - - - -x 2009, he filed a "Motion for Leave to File [a] Motion for Clarification[, and the] Second Motion for
Reconsideration and Motion to Refer Resolution to the Court En Banc." He later also filed a
"Supplement to Second Motion for Reconsideration with Motion to Dismiss" dated January 6,
G.R. No. 170889
2010.

JOHN LU YM and LUDO & LUYM DEVELOPMENT CORPORATION, Petitioners,

John Lu Ym and Ludo & Luym Development Corporation (LLDC), meanwhile, filed with leave a
vs. Motion5 for the Issuance of an Entry of Judgment of February 2, 2010, which merited an
THE HONORABLE COURT OF APPEALS OF CEBU CITY (FORMER TWENTIETH DIVISION), Opposition from David Lu.
DAVID LU, ROSA GO, SILVANO LUDO & CL CORPORATION, Respondents.

In compliance with the Court’s Resolution of January 11, 2010, Kelly Lu Ym, Victor Lu Ym and
RESOLUTION
Paterno Lu Ym, Jr. filed a Comment/Opposition of March 20, 2010, while John Lu Ym and LLDC
filed a Consolidated Comment of March 25, 2010, a Supplement thereto of April 20, 2010, and a
CARPIO MORALES, J.: Manifestation of May 24, 2010.

By Decision of August 26, 2008, the Court1 unanimously disposed of the three present petitions as
follows:
WHEREFORE, premises considered, the petitions in G.R. Nos. 153690 and 157381 are DENIED
for being moot and academic; while the petition in G.R. No. 170889 is DISMISSED for lack of
merit. Consequently, the Status QuoOrder dated January 23, 2006 is hereby LIFTED.
The Court of Appeals is DIRECTED to proceed with CA-G.R. CV No. 81163 and to resolve the
same with dispatch.
The present cases were later referred to the Court en banc by Resolution of October 20, 2010.
Brief Statement of the Antecedents
The three consolidated cases stemmed from the complaint for "Declaration of Nullity of Share
Issue, Receivership and Dissolution" filed on August 14, 2000 before the Regional Trial Court
(RTC) of Cebu City by David Lu, et al.against Paterno Lu Ym, Sr. and sons (Lu Ym father and
sons) and LLDC.
By Decision of March 1, 2004, Branch 12 of the RTC ruled in favor of David et al. by annulling the
issuance of the shares of stock subscribed and paid by Lu Ym father and sons at less than par
value, and ordering the dissolution and asset liquidation of LLDC. The appeal of the trial court’s
Decision remains pending with the appellate court in CA-G.R. CV No. 81163.
Several incidents arising from the complaint reached the Court through the present three petitions.
(a) cases in which the constitutionality or validity of any treaty, international or executive
agreement, law, executive order, presidential decree, proclamation, order, instruction,
ordinance, or regulation is in question;
(b) criminal cases in which the appealed decision imposes the death penalty or reclusion
perpetua;

In G.R. No. 153690 wherein David, et al. assailed the appellate court’s resolutions dismissing their (c) cases raising novel questions of law;
complaint for its incomplete signatory in the certificate of non-forum shopping and consequently
annulling the placing of the subject corporation under receivership pendente lite, the Court, by (d) cases affecting ambassadors, other public ministers, and consuls;
Decision of August 26, 2008, found the issue to have been mooted by the admission by the trial
court of David et al.’s Amended Complaint, filed by them pursuant to the trial court’s order to
(e) cases involving decisions, resolutions, and orders of the Civil Service Commission, the
conform to the requirements of the Interim Rules of Procedure Governing Intra-Corporate
Commission on Elections, and the Commission on Audit;
Controversies.

Since an amended pleading supersedes the pleading that it amends, the original complaint of
David, et al. was deemed withdrawn from the records.
The Court noted in G.R. No. 153690 that both parties admitted the mootness of the issue and that
the trial court had already rendered a decision on the merits of the case. It added that the
Amended Complaint stands since Lu Ym father and sons availed of an improper mode (via an
Urgent Motion filed with this Court) to assail the admission of the Amended Complaint.
(f) cases where the penalty recommended or imposed is the dismissal of a judge, the
disbarment of a lawyer, the suspension of any of them for a period of more than one year,
or a fine exceeding forty thousand pesos;
(g) cases covered by the preceding paragraph and involving the reinstatement in the
judiciary of a dismissed judge, the reinstatement of a lawyer in the roll of attorneys, or the
lifting of a judge’s suspension or a lawyer’s suspension from the practice of law;

In G.R. No. 157381 wherein Lu Ym father and sons challenged the appellate court’s resolution
restraining the trial court from proceeding with their motion to lift the receivership order which was
filed during the pendency of G.R. No. 153690, the Court, by Decision of August 26, 2008 resolved
that the issue was mooted by the amendment of the complaint and by the trial court’s decision on
the merits. The motion having been filed ancillary to the main action, which main action was
already decided on the merits by the trial court, the Court held that there was nothing more to
enjoin.
(h) cases involving the discipline of a Member of the Court, or a Presiding Justice, or any
Associate Justice of the collegial appellate court;
(i) cases where a doctrine or principle laid down by the Court en banc or by a Division my
be modified or reversed;
(j) cases involving conflicting decisions of two or more divisions;

G.R. No. 170889 involved the denial by the appellate court of Lu Ym father and sons’ application (k) cases where three votes in a Division cannot be obtained;
in CA-G.R. CV No. 81163 for a writ of preliminary injunction. By August 26, 2008 Decision, the
Court dismissed the petition after finding no merit on their argument – which they raised for the (l) Division cases where the subject matter has a huge financial impact on businesses or
first time in their motion for reconsideration before the appellate court – of lack of jurisdiction for affects the welfare of a community;
non-payment of the correct RTC docket fees.
(m) Subject to Section 11 (b) of this rule, other division cases that, in the opinion of at
As reflected early on, the Court, in a turnaround, by Resolution of August 4, 2009, reconsidered its least three Members of the Division who are voting and present, are appropriate for
position on the matter of docket fees. It ruled that the trial court did not acquire jurisdiction over the transfer to the Court en banc;
case for David Lu, et al.’s failure to pay the correct docket fees, hence, all interlocutory matters
and incidents subject of the present petitions must consequently be denied.
(n) cases that the Court en banc deems of sufficient importance to merit its attention; and
Taking Cognizance of the Present Incidents
(o) all matters involving policy decisions in the administrative supervision of all courts and
their personnel.6(underscoring supplied)
The Internal Rules of the Supreme Court (IRSC) states that the Court en banc shall act on the
following matters and cases:
The enumeration is an amalgamation of SC Circular No. 2-89 (February 7, 1989), as amended by
En Banc Resolution of November 18, 1993, and the amplifications introduced by Resolution of
January 18, 2000 in A.M. No. 99-12-08-SC with respect to administrative cases and matters.
The present cases fall under at least three types of cases for consideration by the Court En Banc.
At least three members of the Court’s Second Division (to which the present cases were
transferred,7 they being assigned to a Member thereof) found, by Resolution of October 20, 2010,
that the cases were appropriate for referral-transfer to the Court En Banc which subsequently
accepted8 the referral in view of the sufficiently important reason to resolve all doubts on the
validity of the challenged resolutions as they appear to modify or reverse doctrines or principles of
law.
In Firestone Ceramics v. Court of Appeals,9 the Court treated the consolidated cases as En Banc
cases and set the therein petitioners’ motion for oral argument, after finding that the cases were of
sufficient importance to merit the Court En Banc’s attention. It ruled that the Court’s action is a
legitimate and valid exercise of its residual power.10
In Limketkai Sons Milling, Inc. v. Court of Appeals, the Court conceded that it is not infallible.
Should any error of judgment be perceived, it does not blindly adhere to such error, and the
parties adversely affected thereby are not precluded from seeking relief therefrom, by way of a
motion for reconsideration. In this jurisdiction, rectification of an error, more than anything else, is
of paramount importance.
xxxx
It bears stressing that where, as in the present case, the Court En Banc entertains a case for its
resolution and disposition, it does so without implying that the Division of origin is incapable of
rendering objective and fair justice. The action of the Court simply means that the nature of the
cases calls for en banc attention and consideration. Neither can it be concluded that the Court has
taken undue advantage of sheer voting strength. It was merely guided by the well-studied finding
and sustainable opinion of the majority of its actual membership– that, indeed, subject cases are
of sufficient importance meriting the action and decision of the whole Court. It is, of course,
beyond cavil that all the members of this highest Court of the land are always embued with the
noblest of intentions in interpreting and applying the germane provisions of law, jurisprudence,
rules and Resolutions of the Court– to the end that public interest be duly safeguarded and rule of
law be observed.11
It is argued that the assailed Resolutions in the present cases have already become final, 12 since
a second motion for reconsideration is prohibited except for extraordinarily persuasive reasons
and only upon express leave first obtained;13 and that once a judgment attains finality, it thereby
becomes immutable and unalterable, however unjust the result of error may appear.
The contention, however, misses an important point. The doctrine of immutability of decisions
applies only to final and executory decisions. Since the present cases may involve a modification
or reversal of a Court-ordained doctrine or principle, the judgment rendered by the Special Third
Division may be considered unconstitutional, hence, it can never become final. It finds mooring in
the deliberations of the framers of the Constitution:
On proposed Section 3(4), Commissioner Natividad asked what the effect would be of a decision
that violates the proviso that "no doctrine or principle of law laid down by the court in a decision
rendered en banc or in division may be modified or reversed except by the court en banc." The
answer given was that such a decision would be invalid. Following up, Father Bernas
asked whether the decision, if not challenged, could become final and bindingat least on the
parties. Romulo answered that, since such a decision would be in excess of jurisdiction, the
decision on the case could be reopened anytime.14 (emphasis and underscoring supplied)
A decision rendered by a Division of this Court in violation of this constitutional provision would be
in excess of jurisdiction and, therefore, invalid.15 Any entry of judgment may thus be said to be
"inefficacious"16 since the decision is void for being unconstitutional.
While it is true that the Court en banc exercises no appellate jurisdiction over its Divisions, Justice
Minerva Gonzaga-Reyes opined in Firestone and concededly recognized that "[t]he only constraint
is that any doctrine or principle of law laid down by the Court, either rendered en banc or in
division, may be overturned or reversed only by the Court sitting en banc."17
That a judgment must become final at some definite point at the risk of occasional error cannot be
appreciated in a case that embroils not only a general allegation of "occasional error" but also a
serious accusation of a violation of the Constitution, viz., that doctrines or principles of law were
modified or reversed by the Court’s Special Third Division August 4, 2009 Resolution.
The law allows a determination at first impression that a doctrine or principle laid down by the
court en banc or in division may be modified or reversed in a case which would warrant a referral
to the Court En Banc. The use of the word "may" instead of "shall" connotes probability, not
certainty, of modification or reversal of a doctrine, as may be deemed by the Court. Ultimately, it is
the entire Court which shall decide on the acceptance of the referral and, if so, "to reconcile any
seeming conflict, to reverse or modify an earlier decision, and to declare the Court’s doctrine."18
The Court has the power and prerogative to suspend its own rules and to exempt a case from
their operation if and when justice requires it,19 as in the present circumstance where movant filed
a motion for leave after the prompt submission of a second motion for reconsideration but,
nonetheless, still within 15 days from receipt of the last assailed resolution.
Well-entrenched doctrines or principles of law that went astray need to be steered back to their
proper course. Specifically, as David Lu correctly points out, it is necessary to reconcile and
declare the legal doctrines regarding actions that are incapable of pecuniary estimation,
application of estoppel by laches in raising an objection of lack of jurisdiction, and whether bad
faith can be deduced from the erroneous annotation of lis pendens.
Upon a considered, thorough reexamination, the Court grants David Lu’s Motion for
Reconsideration. The assailed Resolutions of August 4, 2009 and September 23, 2009,
which turn turtle settled doctrines, must be overturned. The Court thus reinstates the August
26, 2008 Decision wherein a three-tiered approach was utilized to analyze the issue on docket
fees:
In the instant case, however, we cannot grant the dismissal prayed for because of the following
reasons: First, the case instituted before the RTC is one incapable of pecuniary estimation.
Hence, the correct docket fees were paid. Second, John and LLDC are estopped from
questioning the jurisdiction of the trial court because of their active participation in the
proceedings below, and because the issue of payment of insufficient docket fees had been
belatedly raised before the Court of Appeals, i.e., only in their motion for reconsideration. Lastly,
assuming that the docket fees paid were truly inadequate, the mistake was committed by the
Clerk of Court who assessed the same and not imputable to David; and as to the deficiency,
if any, the same may instead be considered a lien on the judgment that may thereafter be
rendered.20 (italics in the original; emphasis and underscoring supplied)
The Value of the Subject Matter Cannot be Estimated
On the claim that the complaint had for its objective the nullification of the issuance of 600,000
shares of stock of LLDC, the real value of which based on underlying real estate values, as
alleged in the complaint, stands at ₱1,087,055,105, the Court’s assailed August 4, 2009
Resolution found:
Upon deeper reflection, we find that the movants’ [Lu Ym father & sons] claim has merit. The
600,000 shares of stock were, indeed, properties in litigation. They were the subject matter of the
complaint, and the relief prayed for entailed the nullification of the transfer thereof and their return
to LLDC. David, et al., are minority shareholders of the corporation who claim to have
been prejudiced by the sale of the shares of stock to the Lu Ym father and sons. Thus, to the
extent of the damage or injury they allegedly have suffered from this sale of the shares of stock,
the action they filed can be characterized as one capable of pecuniary estimation. The shares of
stock have a definite value, which was declared by plaintiffs [David Lu, et al.] themselves in their
complaint. Accordingly, the docket fees should have been computed based on this amount. This is
clear from the following version of Rule 141, Section 7, which was in effect at the time the
complaint was filed[.]21 (emphasis and underscoring supplied)
The said Resolution added that the value of the 600,000 shares of stock, which are the properties
in litigation, should be the basis for the computation of the filing fees. It bears noting, however,
that David, et al. are not claiming to own these shares. They do not claim to be the owners thereof
entitled to be the transferees of the shares of stock. The mention of the real value of the shares of
stock, over which David, et al. do not, it bears emphasis, interpose a claim of right to
recovery, is merely narrative or descriptive in order to emphasize the inequitable price at which
the transfer was effected.
The assailed August 4, 2009 Resolution also stated that "to the extent of the damage or injury
[David, et al.] allegedly have suffered from this sale," the action "can be characterized as one
capable of pecuniary estimation." The Resolution does not, however, explore the value of the
extent of the damage or injury. Could it be the pro ratadecrease (e.g., from 20% to 15%) of the
percentage shareholding of David, et al. vis-à-vis to the whole?
Whatever property, real or personal, that would be distributed to the stockholders would be a mere
consequence of the main action. In the end, in the event LLDC is dissolved, David, et
al. would not be getting the value of the 600,000 shares, but only the value of their minority
number of shares, which are theirs to begin with.
The complaint filed by David, et al. is one for declaration of nullity of share issuance. The main
relief prayed for both in the original complaint and the amended complaint is the same, that is, to
declare null and void the issuance of 600,000 unsubscribed and unissued shares to Lu Ym father
and sons, et al. for a price of 1/18 of their real value, for being inequitable, having been done in
breach of director’s fiduciary’s duty to stockholders, in violation of the minority stockholders’ rights,
and with unjust enrichment.
As judiciously discussed in the Court’s August 26, 2008 Decision, the test in determining whether
the subject matter of an action is incapable of pecuniary estimation is by ascertaining the nature of
the principal action or remedy sought. It explained:
x x x To be sure, the annulment of the shares, the dissolution of the corporation and the
appointment of receivers/management committee are actions which do not consist in
the recovery of a sum of money. If, in the end, a sum of money or real property would be
recovered, it would simply be the consequence of such principal action. Therefore, the case
before the RTC was incapable of pecuniary estimation.22 (italics in the original, emphasis and
underscoring supplied)
Actions which the Court has recognized as being incapable of pecuniary estimation
include legality of conveyances. In a case involving annulment of contract, the Court found it to be
one which cannot be estimated:
Petitioners argue that an action for annulment or rescission of a contract of sale of real property is
a real action and, therefore, the amount of the docket fees to be paid by private respondent should
be based either on the assessed value of the property, subject matter of the action, or its
estimated value as alleged in the complaint, pursuant to the last paragraph of §7(b) of Rule 141,
as amended by the Resolution of the Court dated September 12, 1990. Since private respondents
alleged that the land, in which they claimed an interest as heirs, had been sold for P4,378,000.00
to petitioners, this amount should be considered the estimated value of the land for the purpose of
determining the docket fees.
On the other hand, private respondents counter that an action for annulment or rescission of a
contract of sale of real property is incapable of pecuniary estimation and, so, the docket fees
should be the fixed amount of P400.00 in Rule 141, §7(b)(1). In support of their argument, they
cite the cases of Lapitan v. Scandia, Inc. and Bautista v. Lim. In Lapitan this Court, in an opinion
by Justice J.B.L. Reyes, held:
A review of the jurisprudence of this Court indicates that in determining whether an action is one
the subject matter of which is not capable of pecuniary estimation, this Court has adopted the
criterion of first ascertaining the nature of the principal action or remedy sought. If it is primarily for
the recovery of a sum of money, the claim is considered capable of pecuniary estimation, and
whether jurisdiction is in the municipal courts or in the courts of first instance would depend on the
amount of the claim. However, where the basic issue is something other than the right to recover a
sum of money, or where the money claim is purely incidental to, or a consequence of, the principal
relief sought, like in suits to have the defendant perform his part of the contract (specific
performance) and in actions for support, or for annulment of a judgment or to foreclose a
mortgage, this Court has considered such actions as cases where the subject of the litigation may
not be estimated in terms of money, and are cognizable exclusively by courts of first instance. The
rationale of the rule is plainly that the second class cases, besides the determination of
damages, demand an inquiry into other factors which the law has deemed to be more
within the competence of courts of first instance, which were the lowest courts of record at the
time that the first organic laws of the Judiciary were enacted allocating jurisdiction (Act 136 of the
Philippine Commission of June 11, 1901).
Actions for specific performance of contracts have been expressly pronounced to be exclusively
cognizable by courts of first instance: De Jesus vs. Judge Garcia, L-26816, February 28,
1967; Manufacturer's Distributors, Inc. vs. Yu Siu Liong, L-21285, April 29, 1966. And no cogent
reason appears, and none is here advanced by the parties, why an action for rescission (or
resolution) should be differently treated, a "rescission" being a counterpart, so to speak, of
"specific performance". In both cases, the court would certainly have to undertake an
investigation into facts that would justify one act or the other. No award for damages may
be had in an action for rescission without first conducting an inquiry into matters which
would justify the setting aside of a contract, in the same manner that courts of first instance
would have to make findings of fact and law in actions not capable of pecuniary estimation
expressly held to be so by this Court, arising from issues like those raised in Arroz v. Alojado, et
al., L-22153, March 31, 1967 (the legality or illegality of the conveyancesought for and the
determination of the validity of the money deposit made); De Ursua v. Pelayo, L-13285, April 18,
1950 (validity of a judgment); Bunayog v. Tunas, L-12707, December 23, 1959 (validity of a
mortgage); Baito v. Sarmiento, L-13105, August 25, 1960 (the relations of the parties, the right to
support created by the relation, etc., in actions for support), De Rivera, et al. v. Halili, L-15159,
September 30, 1963 (the validity or nullity of documents upon which claims are predicated). Issues
of the same nature may be raised by a party against whom an action for rescission has been
brought, or by the plaintiff himself. It is, therefore, difficult to see why a prayer for damages in an
action for rescission should be taken as the basis for concluding such action as one capable of
pecuniary estimation — a prayer which must be included in the main action if plaintiff is to be
compensated for what he may have suffered as a result of the breach committed by defendant,
and not later on precluded from recovering damages by the rule against splitting a cause of action
and discouraging multiplicity of suits.23 (emphasis and underscoring supplied)
IN FINE, the Court holds that David Lu, et al.’s complaint is one incapable of pecuniary estimation,
hence, the correct docket fees were paid. The Court thus proceeds to tackle the arguments on
estoppel and lien, mindful that the succeeding discussions rest merely on a
contrary assumption, viz., that there was deficient payment.
Estoppel Has Set In
Assuming arguendo that the docket fees were insufficiently paid, the doctrine of estoppel already
applies.
24
The assailed August 4, 2009 Resolution cited Vargas v. Caminas on the non-applicability of
the Tijam doctrine where the issue of jurisdiction was, in fact, raised before the trial court rendered
its decision. Thus the Resolution explained:
Next, the Lu Ym father and sons filed a motion for the lifting of the receivership order, which the
trial court had issued in the interim. David, et al., brought the matter up to the CA even before the
trial court could resolve the motion. Thereafter, David, at al., filed their Motion to Admit Complaint
to Conform to the Interim Rules Governing Intra-Corporate Controversies. It was at this point that
the Lu Ym father and sons raised the question of the amount of filing fees paid. They also raised
this point again in the CA when they appealed the trial court’s decision in the case below.
We find that, in the circumstances, the Lu Ym father and sons are not estopped from challenging
the jurisdiction of the trial court. They raised the insufficiency of the docket fees before the trial
court rendered judgment and continuously maintained their position even on appeal to the CA.
Although the manner of challenge was erroneous – they should have addressed this issue directly
to the trial court instead of the OCA – they should not be deemed to have waived their right to
assail the jurisdiction of the trial court.25 (emphasis and underscoring supplied)
Lu Ym father and sons did not raise the issue before the trial court. The narration of facts in the
Court’s original decision shows that Lu Ym father and sons merely inquired from the Clerk of Court
on the amount of paid docket fees on January 23, 2004. They thereafter still "speculat[ed] on the
fortune of litigation."26 Thirty-seven days later or on March 1, 2004 the trial court rendered its
decision adverse to them.
Meanwhile, Lu Ym father and sons attempted to verify the matter of docket fees from the Office of
the Court Administrator (OCA). In their Application for the issuance a writ of preliminary injunction
filed with the Court of Appeals, they still failed to question the amount of docket fees paid by David
Lu, et al. It was only in their Motion for Reconsideration of the denial by the appellate court of their
application for injunctive writ that they raised such issue.
Lu Ym father and sons’ further inquiry from the OCA cannot redeem them. A mere inquiry from
an improper office at that, could not, by any stretch, be considered as an act of having raised the
jurisdictional question prior to the rendition of the trial court’s decision. In one case, it was held:
Here it is beyond dispute that respondents paid the full amount of docket fees as assessed by the
Clerk of Court of the Regional Trial Court of Malolos, Bulacan, Branch 17, where they filed the
complaint. If petitioners believed that the assessment was incorrect, they should have questioned
it before the trial court. Instead, petitioners belatedly question the alleged underpayment of docket
fees through this petition, attempting to support their position with the opinion and
certification of the Clerk of Court of another judicial region. Needless to state, such
certification has no bearing on the instant case.27 (italics in the original; emphasis and
underscoring in the original)
The inequity resulting from the abrogation of the whole proceedings at this late stage when the
decision subsequently rendered was adverse to the father and sons is precisely the evil being
avoided by the equitable principle of estoppel.
No Intent to Defraud the Government
Assuming arguendo that the docket fees paid were insufficient, there is no proof of bad faith to
warrant a dismissal of the complaint, hence, the following doctrine applies:
x x x In Sun Insurance Office, Ltd., (SIOL) v. Asuncion, this Court ruled that the filing of the
complaint or appropriate initiatory pleading and the payment of the prescribed docket fee vest a
trial court with jurisdiction over the subject matter or nature of the action. If the amount of docket
fees paid is insufficient considering the amount of the claim, the clerk of court of the lower court
involved or his duly authorized deputy has the responsibility of making a deficiency
assessment. The party filing the case will be required to pay the deficiency, but jurisdiction is not
automatically lost.28 (underscoring supplied)
The assailed Resolution of August 4, 2009 held, however, that the above-quoted doctrine does not
apply since there was intent to defraud the government, citing one attendant circumstance– the
annotation of notices of lis pendenson real properties owned by LLDC. It deduced:
From the foregoing, it is clear that a notice of lis pendens is availed of mainly in real actions.
Hence, when David, et al., sought the annotation of notices of lis pendens on the titles of LLDC,
they acknowledged that the complaint they had filed affected a title to or a right to possession of
real properties. At the very least, they must have been fully aware that the docket fees would be
based on the value of the realties involved. Their silence or inaction to point this out to the Clerk of
Court who computed their docket fees, therefore, becomes highly suspect, and thus, sufficient for
this Court to conclude that they have crossed beyond the threshold of good faith and into the area
of fraud. Clearly, there was an effort to defraud the government in avoiding to pay the correct
docket fees. Consequently, the trial court did not acquire jurisdiction over the case.29
All findings of fraud should begin the exposition with the presumption of good faith. The inquiry is
not whether there was good faith on the part of David, et al., but whether there was bad faith on
their part.
The erroneous annotation of a notice of lis pendens does not negate good faith. The
overzealousness of a party in protecting pendente lite his perceived interest, inchoate or
otherwise, in the corporation’s properties from depletion or dissipation, should not be lightly
equated to bad faith.
That notices of lis pendens were erroneously annotated on the titles does not have the effect of
changing the nature of the action. The aggrieved party is not left without a remedy, for they can
move to cancel the annotations. The assailed August 4, 2009 Resolution, however, deemed such
act as an acknowledgement that the case they filed was a real action, concerning as it indirectly
does the corporate realties, the titles of which were allegedly annotated. This conclusion does not
help much in ascertaining the filing fees because the value of these real properties and the value
of the 600,000 shares of stock are different.
Further, good faith can be gathered from the series of amendments on the provisions on filing
fees, that the Court was even prompted to make a clarification.1avvphi1
When David Lu, et al. filed the Complaint on August 14, 2000 or five days after the effectivity of
the Securities Regulation Code or Republic Act No. 8799,30 the then Section 7 of Rule 141 was
the applicable provision, without any restricted reference to paragraphs (a) and (b) 1 &
3 or paragraph (a) alone. Said section then provided:
SEC. 7. Clerks of Regional Trial Courts. –
(a) For filing an action or a permissive counterclaim or money claim against an estate not
based on judgment, or for filing with leave of court a third-party, fourth-party, etc.
complaint, or a complaint in intervention, and for all clerical services in the same, if the
total sum claimed, exclusive of interest, or the stated value of the property in
litigation, is:
xxxx
(b) For filing:
1. Actions where the value of the subject matter ……….…..
cannot be estimated xxx
2. Special civil actions except judicial foreclosure of
mortgage which shall be governed by paragraph …...….…….
(a) above xxx
3. ……….……
All other actions not involving property
xxx
In a real action, the assessed value of the property, or if there is none, the estimated value thereof
shall be alleged by the claimant and shall be the basis in computing the fees.
x x x x31 (emphasis supplied)
The Court, by Resolution of September 4, 2001 in A. M. No. 00-8-10-SC,32 clarified the matter of
legal fees to be collected in cases formerly cognizable by the Securities and Exchange
Commission following their transfer to the RTC.
Clarification has been sought on the legal fees to be collected and the period of appeal applicable
in cases formerly cognizable by the Securities and Exchange Commission. It appears that the
Interim Rules of Procedure on Corporate Rehabilitation and the Interim Rules of Procedure for
Intra-Corporate Controversies do not provide the basis for the assessment of filing fees and the
period of appeal in cases transferred from the Securities and Exchange Commission to particular
Regional Trial Courts.
The nature of the above mentioned cases should first be ascertained. Section 3(a), Rule 1 of the
1997 Rules of Civil Procedure defines civil action as one by which a party sues another for the
enforcement or protection of a right, or the prevention or redress of a wrong. It further states that a
civil action may either be ordinary or special, both being governed by the rules for ordinary civil
actions subject to the special rules prescribed for special civil actions. Section 3(c) of the same
Rule, defines a special proceeding as a remedy by which a party seeks to establish a status, a
right, or a particular fact.
Applying these definitions, the cases covered by the Interim Rules for Intra-Corporate
Controversies should be considered as ordinary civil actions. These cases either seek the
recovery of damages/property or specific performance of an act against a party for the
violation or protection of a right. These cases are:
(1) Devices or schemes employed by, or any act of, the board of directors, business
associates, officers or partners, amounting to fraud or misrepresentation which may be
detrimental to the interest of the public and/or of the stockholders, partners, or members
of any corporation, partnership, or association;
(2) Controversies arising out of intra-corporate, partnership, or association relations,
between and among stockholders, members or associates; and between, any or all of
them and the corporation, partnership, or association of which they are stockholders,
members or associates, respectively;
(3) Controversies in the election or appointment of directors, trustees, officers, or
managers of corporations, partnerships, or associations;
By referring the computation of such docket fees to paragraph (a) only, it denotes that an intra-
corporate controversy always involves a property in litigation, the value of which is always the
basis for computing the applicable filing fees. The latest amendments seem to imply that there can
be no case of intra-corporate controversy where the value of the subject matter cannot be
estimated. Even one for a mere inspection of corporate books.
If the complaint were filed today, one could safely find refuge in the express phraseology of
Section 21 (k) of Rule 141 that paragraph (a) alone applies.
In the present case, however, the original Complaint was filed on August 14, 2000 during which
time Section 7, without qualification, was the applicable provision. Even the Amended Complaint
was filed on March 31, 2003 during which time the applicable rule expressed that paragraphs (a)
and (b) l & 3 shall be the basis for computing the filing fees in intra-corporate cases, recognizing
that there could be an intra-corporate controversy where the value of the subject matter cannot be
estimated, such as an action for inspection of corporate books. The immediate illustration shows
that no mistake can even be attributed to the RTC clerk of court in the assessment of the docket
fees.

(4) Derivative suits; and
(5) Inspection of corporate books.
On the other hand, a petition for rehabilitation, the procedure for which is provided in the Interim
Rules of Procedure on Corporate Recovery, should be considered as a special proceeding. It is
one that seeks to establish the status of a party or a particular fact. As provided in section 1, Rule
4 of the Interim Rules on Corporate Recovery, the status or fact sought to be established is the
inability of the corporate debtor to pay its debts when they fall due so that a rehabilitation plan,
containing the formula for the successful recovery of the corporation, may be approved in the end.
It does not seek a relief from an injury caused by another party.
Finally, assuming there was deficiency in paying the docket fees and assuming further that there
was a mistake in computation, the deficiency may be considered a lien on the judgment that may
be rendered, there being no established intent to defraud the government.
WHEREFORE, the assailed Resolutions of August 4, 2009 and September 23, 2009
are REVERSED and SET ASIDE. The Court’s Decision of August 26, 2008 is REINSTATED.
The Court of Appeals is DIRECTED to resume the proceedings and resolve the remaining issues
with utmost dispatch in CA-G.R. CV No. 81163.
SO ORDERED.

Section 7 of Rule 141 (Legal Fees) of the Revised Rules of Court lays the amount of filing fees to
be assessed for actions or proceedings filed with the Regional Trial Court. Section 7(a) and (b)
apply to ordinary civil actionswhile 7(d) and (g) apply to special proceedings.

In fine, the basis for computing the filing fees in intra-corporate cases shall be section 7(a)
and (b) l & 3 of Rule 141. For petitions for rehabilitation, section 7(d) shall be applied. (emphasis
and underscoring supplied)

The new Section 21(k) of Rule 141 of the Rules of Court, as amended by A.M. No. 04-2-04-
SC33 (July 20, 2004), expressly provides that "[f]or petitions for insolvency or other cases
involving intra-corporate controversies, the fees prescribed under Section 7(a) shall apply." Notatu
dignum is that paragraph (b) 1 & 3 of Section 7 thereof was omitted from the reference. Said
paragraph34 refers to docket fees for filing "[a]ctions where the value of the subject matter cannot
be estimated" and "all other actions not involving property."
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 165777 July 25, 2011
CEFERINA DE UNGRIA [DECEASED], substituted by her HEIRS, represented by LOLITA
UNGRIA SAN JUAN-JAVIER, and RHODORA R. PELOMIDA as their Attorney-in-
fact, Petitioner,
vs.
THE HONORABLE COURT OF APPEALS, THE HONORABLE REGIONAL TRIAL COURT OF
GENERAL SANTOS CITY, BRANCH 35, ROSARIO DIDELES VDA. DE CASTOR, NEPTHALIE
CASTOR ITUCAS, FEROLYN CASTOR FACURIB, RACHEL DE CASTOR, LEA CASTOR
DOLLOLOSA, and ROSALIE CASTOR BENEDICTO, Respondents.
DECISION
PERALTA, J.:
1
Assailed in this petition for review on certiorari are the Decision dated May 26, 2004 and the
Resolution2 dated September 17, 2004 of the Court of Appeals (CA) in CA-G.R. SP No. 60764.
On August 26, 1999, respondents Rosario Dideles Vda. de Castor (Rosario), Nepthalie Castor
Itucas, Ferolyn Castor Facurib (Ferolyn), Rachel De Castor, Lea Castor Dollolosa and Rosalie
Castor Benedicto, filed with the Regional Trial Court (RTC) of General Santos City a
Complaint3 for ownership, possession and damages, and alternative causes of action either to
declare two documents as patent nullities, and/or for recovery of Rosario's conjugal share with
damages or redemption of the subject land against petitioner Ceferina de Ungria, defendants
Avelino Gumban, Dolores Cagaitan, Zacasio Poutan, PO1 Jonas Montales, Ignacio Olarte and
alias Dory. Respondent Rosario is the surviving wife of the late Fernando Castor, while the rest of
the respondents are their legitimate children. The documents they sought to annul are (1) the
Deed of Transfer of Rights and Interest including Improvements thereon dated October 3, 1960
allegedly executed by Fernando in favor of Eugenio de Ungria, petitioner's father; and (2) the
Affidavit of Relinquishment dated November 23, 1960 executed by Eugenio in favor of petitioner.
4 charged.
Petitioner Ceferina filed a Motion to Dismiss (Ex-Abundante Ad Cautelam) on the following
grounds: (1) the claim or demand has been extinguished by virtue of the valid sale of Lot No. 1615
to Eugenio; (2) the action is barred by extraordinary acquisitive prescription; (3) the action is
barred by laches; and (4) plaintiff failed to state a cause of action, or filed the case prematurely for
failure to resort to prior barangay conciliation proceedings.
Petitioner also filed an Addendum to the Motion to Dismiss 5 raising the following additional
grounds: (1) plaintiffs have no legal capacity to sue; and (2) the court has no jurisdiction over the
case for failure of plaintiffs to pay the filing fee in full. Respondents filed their Opposition thereto.
On November 19, 1999, the RTC issued an Order6 denying the motion to dismiss, to wit:
After the motion to dismiss and its addendum have been received, it is now ripe for resolution.
One of the grounds alleged in the complaint is for the recovery of conjugal share on Lot No. 1615,
of Pls-209 D with damages.
It is alleged that the late Fernando Castor and Rosario Dideles Vda. de Castor were married on
September 15, 1952, and the application to the land was dated January 17, 1952 and the patent
was issued by the President on November 19, 1954.
The said land was sold to the defendant on October 3, 1960 (Annex C) and an Affidavit of
Relinquishment dated November 23, 1960 which was made a part thereof as Annex "D."
Considering the marriage of September 15, 1992, the said land became conjugal as of the date of
the marriage and, therefore, ½ thereof belongs to the wife, Rosario Dideles Vda. de Castor.
Thus, considering the above, the motion to dismiss is DENIED.7
Petitioner Ceferina filed a Motion for Reconsideration,8 which the RTC denied in an Order9 dated
February 4, 2000.
Petitioner filed an Omnibus Motion10 asking the RTC to resolve the issues of (1) whether or not the
complaint should be dismissed or expunged from the records pursuant to Supreme Court (SC)
Circular No. 7; (2) reconsidering the findings contained in the Order dated February 4, 2000; and
(3) holding in abeyance the submission of the answer to the complaint.
Pending resolution of the motion, respondents filed a Motion to Allow 11 them to continue
prosecuting this case as indigent litigants.
On March 8, 2000, the RTC resolved the Omnibus Motion in an Order12 that read in this wise:
On the omnibus motion regarding filing fees, the plaintiffs asserted in its motion that they are
charging defendant actual and compensatory damages such as are proved during the hearing of
this case. So also are attorney’s fees and moral damages, all to be proved during the hearing of
this case.
Since there was no hearing yet, they are not in a possession (sic) to determine how much is to be
At any rate, if after hearing the Clerk of Court determine that the filing fees is still insufficient,
considering the total amount of the claim, the Clerk of Court should determine and, thereafter, if
any amount is found due, he must require the private respondent to pay the same x x x.
As to the second issue, the same has already been decided in its order dated February 4, 2000.
WHEREFORE, premises considered, the omnibus motion is DENIED.
The defendant shall file their answer within fifteen (15) days from receipt of this order.13
From this Order, petitioner filed a motion for reconsideration and clarification on whether plaintiffs
should be allowed to continue prosecuting the case as indigent litigants.
On March 30, 2000, the RTC issued a Clarificatory Order14 reading as follows:
As has been said, the plaintiff asserted in its motion that they are charging defendants actual and
compensatory damages as has been proved during the hearing of this case. So also are
attorney's fees and moral damages all to be proved during the hearing of this case.
Since there was no hearing yet, they are not in a possession (sic) to determine how much is to be
charged.
At any rate, after hearing, the Clerk of Court determines that the filing fee is still insufficient, the
same shall be considered as lien on the judgment that may be entered.
As to the motion seeking from the Honorable Court allowance to allow plaintiff to continue
prosecuting this case as indigent litigants, suffice it to say that the same is already provided for in
this order.
WHEREFORE, the defendants shall file their answer within fifteen (15) days from receipt of this
Order.15
In an Order dated May 31, 2000, the RTC again denied petitioner's motion for reconsideration.
Petitioner filed with the CA a petition for certiorari and prohibition with prayer for the issuance of a
temporary restraining order and/or writ of preliminary injunction. Petitioner sought the nullification
of the Order dated November 19, 1999 and the subsequent orders issued by the RTC thereto for
having been issued with grave abuse of discretion amounting to lack or excess of jurisdiction.
Respondents filed their Comment thereto.
In a Decision dated May 26, 2004, the CA dismissed the petition. The CA found that SC Circular
No. 7 would not apply where the amount of damages or value of the property was immaterial; that
the Circular could be applied only in cases where the amount claimed or the value of the personal
property was determinative of the court's jurisdiction citing the case of Tacay v. RTC of Tagum,
Davao del Norte.16 The CA found that respondents had paid the corresponding docket fees upon
the filing of the complaint, thus, the RTC had acquired jurisdiction over the case despite the failure
to state the amount of damages claimed in the body of the complaint or in the prayer thereof. The
CA found that the RTC did not commit grave abuse of discretion amounting to lack of jurisdiction
when it denied petitioner's motion to dismiss. It noted that the RTC's Clarificatory Order dated
March 30, 2000, which stated that "if after hearing the Clerk of Court determines that the filing fee
is still insufficient, the same shall be considered as lien on the judgment that may be entered" was
in accordance with the rule laid down in Sun Insurance Office, Ltd. v. Asuncion.17 The CA
proceeded to state that a judicious examination of the complaint pointed to a determination of the
respective rights and interests of the parties over the property based on the issues presented
therein which could only be determined in a full-blown trial on the merits of the case.
Petitioner filed a Motion for Reconsideration, which the CA denied in a Resolution dated
September 17, 2004. The CA ruled, among others, that the defenses of acquisitive prescription
and laches were likewise unavailing. It found that the subject property is covered by a Torrens title
(OCT No. V-19556); thus, it is axiomatic that adverse, notorious and continuous possession under
a claim of ownership for the period fixed by law is ineffective against a Torrens title; that unless
there are intervening rights of third persons which may be affected or prejudiced by a decision
directing the return of the lot to petitioner, the equitable defense of laches will not apply as against
the registered owner.
Hence, this petition for review on certiorari where petitioner raises the following assignment of
errors:
THE COURT OF APPEALS ERRED IN NOT FINDING THAT RESPONDENT TRIAL
COURT COMMITTED GRAVE ABUSE OF DISCRETION IN DENYING PETITIONER'S
MOTION TO DISMISS DESPITE RESPONDENTS' NON-PAYMENT OF THE CORRECT
DOCKET FEES.
THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE ACTION OF PRIVATE
RESPONDENTS IS BARRED BY LACHES AND EXTRAORDINARY ACQUISITIVE
PRESCRIPTION.18
We find the petition without merit.
Preliminarily, although not raised as an issue in this petition, we find it necessary to discuss the
issue of jurisdiction over the subject matter of this case. Respondents' complaint was filed in 1999,
at the time Batas Pambansa Blg. (BP) 129, the Judiciary Reorganization Act of 1980, was already
amended by Republic Act (RA) No. 7691, An Act Expanding the Jurisdiction of the Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts, amending for the purpose
BP Blg. 129.19 Section 1 of RA 7691, amending BP Blg. 129, provides that the RTC shall exercise
exclusive original jurisdiction on the following actions:
Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary
Reorganization Act of 1980," is hereby amended to read as follows:
Sec. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
(2) In all civil actions which involve the title to, or possession of, real property, or any
interest therein, where the assessed value of the property involved exceeds Twenty
Thousand Pesos (₱20,000.00) or for civil actions in Metro Manila, where such value
 exceeds Fifty Thousand Pesos (₱50,000.00), except actions for forcible entry into and
unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon
the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts; x
xx
Section 3 of RA No. 7691 expanded the exclusive original jurisdiction of the first level courts, thus:
Section 3. Section 33 of the same law (BP Blg. 129) is hereby amended to read as follows:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts in Civil Cases. – Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit
Trial Courts shall exercise:
xxxx
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where the assessed value of the property or interest therein does
not exceed Twenty Thousand Pesos (₱20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty Thousand Pesos (₱50,000.00) exclusive of interest,
damages of whatever kind, attorney's fees, litigation expenses and costs: Provided, That in cases
of land not declared for taxation purposes, the value of such property shall be determined by the
assessed value of the adjacent lots.
Respondents filed their Complaint with the RTC; hence, we would first determine whether the RTC
has jurisdiction over the subject matter of this case based on the above-quoted provisions.
The Complaint filed by respondents in the RTC was for ownership, possession and damages, and
alternative causes of action either to declare two documents as patent nullities and/or for recovery
of conjugal share on the subject land with damages or redemption of the subject land. In their
Complaint, respondents claimed that Rosario and Fernando are the registered owners of the
subject land with an assessed value of ₱12,780.00; that the couple left the cultivation and
enjoyment of the usufruct of the subject land to Fernando's mother and her second family to
augment their means of livelihood; that respondent Rosario and Fernando thought that when the
latter's mother died in 1980, the subject land was in the enjoyment of the second family of his
mother, but later learned that the subject land was leased by petitioner Ceferina; that sometime in
August 1999, respondents learned of the existence of the Deed of Transfer of Rights and Interest
including Improvements thereon dated October 3, 1960, where Fernando had allegedly
transferred his rights and interests on the subject land in favor of Eugenio, petitioner Ceferina's
father, as well as an Affidavit of Relinquishment dated November 23, 1960 executed by Eugenio in
favor of petitioner Ceferina; that Fernando's signature in the Deed of Transfer was not his but a
forgery; and the Affidavit of Relinquishment was also void as it was a direct result of a simulated
Deed of Transfer.
Respondents prayed that they be declared as absolute and lawful owners of the subject land and
to order petitioner and the other defendants to vacate the premises and restore respondents to its
possession and enjoyment therefore. On their second cause of action, they prayed that the Deed
of Transfer of Rights and Interest Including Improvements Thereon be declared as a forgery,
purely simulated and without any consideration; hence, inexistent, void ab initio and/or a patent
nullity, as well as the Affidavit of Relinquishment which was the direct result of the Deed of
Transfer. Respondents also prayed in the alternative that if the Deed be finally upheld as valid, to
order petitioner to reconvey to respondent Rosario the undivided one-half portion of the subject
land as conjugal owner thereof and to account and reimburse her of its usufruct; and/or to allow
them to redeem the subject land.
It would appear that the first cause of action involves the issue of recovery of possession and
interest of the parties over the subject land which is a real action. Respondents alleged that the
assessed value of the subject land was ₱12,780.00 based on Tax Declaration No. 15272. Thus,
since it is a real action with an assessed value of less than ₱20,000.00, the case would fall under
the jurisdiction of the MTC as provided under the above-quoted Section 33 (3) of BP 129, as
amended.
Notably, however, respondents in the same Complaint filed alternative causes of action assailing
the validity of the Deed of Transfer of Rights and Interest executed by Fernando in favor of
petitioner's father. Respondents also sought for the reconveyance to respondent Rosario of the
undivided one-half portion of the subject land as conjugal owner thereof in case the Deed of
Transfer of Rights and Interest will be upheld as valid; and/or for redemption of the subject land.
Clearly, this is a case of joinder of causes of action which comprehends more than the issue of
possession of, or any interest in the real property under contention, but includes an action to annul
contracts and reconveyance which are incapable of pecuniary estimation and, thus, properly
within the jurisdiction of the RTC.20
In Singson v. Isabela Sawmill,21 we held that:
In determining whether an action is one the subject matter of which is not capable of pecuniary
estimation this Court has adopted the criterion of first ascertaining the nature of the principal
action or remedy sought. If it is primarily for the recovery of a sum of money, the claim is
considered capable of pecuniary estimation, and whether jurisdiction is in the municipal courts or
in the courts of first instance would depend on the amount of the claim. However, where the basic
issue is something other than the right to recover a sum of money, where the money claim is
purely incidental to, or a consequence of, the principal relief sought, this Court has considered
such actions as cases where the subject of the litigation may not be estimated in terms of money,
and are cognizable exclusively by courts of first instance (now Regional Trial Courts).22
Thus, respondents correctly filed their Complaint with the RTC.
It is a settled rule in this jurisdiction that when an action is filed in court, the complaint must be
accompanied by the payment of the requisite docket and filing fees. 23 It is not simply the filing of
the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that
vests a trial court with jurisdiction over the subject matter or nature of the action.24
Section 7(b)(1) of Rule 141 of the Rules of Court provides:
SEC. 7. Clerks of Regional Trial Courts. - (a) For filing an action or a permissive counter-claim or
money claim against an estate not based on judgment, or for filing with leave of court a third-party,
fourth-party, etc. complaint, or a complaint-in-intervention, and for all clerical services in the same,
if the total-sum claimed, exclusive of interest, or the stated value of the property in litigation, is:
xxxx
(b) For filing:
1. Actions where the value of the subject matter
cannot be estimated ........ ₱400.00
2. x x x
In a real action, the assessed value of the property, or if there is none, the estimated
value thereof shall be alleged by the claimant and shall be the basis in computing the
fees.25
Since we find that the case involved the annulment of contract which is not susceptible of
pecuniary estimation, thus, falling within the jurisdiction of the RTC, the docket fees should not be
based on the assessed value of the subject land as claimed by petitioner in their memorandum,
but should be based on Section 7(b)(1) of Rule 141. A perusal of the entries in the Legal Fees
Form attached to the records would reflect that the amount of ₱400.00 was paid to the Clerk of
Court, together with the other fees, as assessed by the Clerk of Court. Thus, upon respondents'
proof of payment of the assessed fees, the RTC has properly acquired jurisdiction over the
complaint. Jurisdiction once acquired is never lost, it continues until the case is terminated. 26
Notably, petitioner’s claim that the RTC did not acquire jurisdiction in this case is premised on her
contention that respondents violated SC Circular No. 7 issued on March 24, 1998 requiring that all
complaints must specify the amount of damages sought not only in the body of the pleadings but
also in the prayer to be accepted and admitted for filing. Petitioner argues that respondents
alleged in paragraph 13 of their Complaint that:
(T)he reasonable rental for the use of the [subject] land is ₱2,000.00 per hectare, every crop time,
once every four months, or ₱6,000.00 a year per hectare; that defendants in proportion and length
of time of their respective occupancy is and/or are jointly and severally liable to plaintiffs of the
produce thereby in the following proportions, viz: (a) for defendant Ceferina de Ungria for a period
of time claimed by her as such; (b) for defendants Dolores Cagautan, a certain alias "Dory," and
PO1 Jonas Montales, of an undetermined area, the latter having entered the area sometime in
1998 and defendant alias "Dory," only just few months ago; that defendant Ignacio Olarte and
Zacasio Puutan of occupying about one-half hectare each.27
and in their prayer asked:
x x x Ordering the defendants, jointly and severally, in proportion to the length and area of their
respective occupancy, to pay reasonable rentals to the plaintiffs in the proportion and amount
assessed in paragraph 13 of the First Cause of Action.
xxxx
(a) Ordering the defendants, jointly and severally, to pay plaintiffs actual and
compensatory damages such as are proved during the hearing of this case;
(b) Ordering the defendants, jointly and severally, to pay plaintiffs attorneys' fees and
moral damages, all to be proved during the hearing of this case.28
Thus, the RTC should have dismissed the case, since respondents did not specify the amount of
damages in their prayer.
We are not persuaded.
SC Circular No. 7 was brought about by our ruling in Manchester Development Corporation v.
Court of Appeals,29where we held that a pleading which does not specify in the prayer the amount
of damages being asked for shall not be accepted or admitted, or shall otherwise be expunged
from the record; and that the Court acquires jurisdiction over any case only upon the payment of
the prescribed docket fee.
However, in Sun Insurance Office, Ltd. v. Asuncion,30 we laid down the following guidelines in the
payment of docket fees, to wit:
1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the
payment of the prescribed docket fee, that vests a trial court with jurisdiction over the
subject matter or nature of the action. Where the filing of the initiatory pleading is not
accompanied by payment of the docket fee, the court may allow payment of the fee within
a reasonable time but in no case beyond the applicable prescriptive or reglementary
period.
2. The same rule applies to permissive counterclaims, third-party claims and similar
pleadings, which shall not be considered filed until and unless the filing fee prescribed
therefor is paid. The court may also allow payment of said fee within a reasonable time
but also in no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate
pleading and payment of the prescribed filing fee but, subsequently, the judgment awards
a claim not specified in the pleading, or if specified the same has been left for
determination by the court, the additional filing fee therefor shall constitute a lien on the
judgment. It shall be the responsibility of the Clerk of Court or his duly-authorized deputy
to enforce said lien and assess and collect the additional fee.
Subsequently, in Heirs of Bertuldo Hinog v. Melicor,31 we said:
Furthermore, the fact that private respondents prayed for payment of damages "in amounts
justified by the evidence" does not call for the dismissal of the complaint for violation of SC
Circular No. 7, dated March 24, 1988 which required that all complaints must specify the amount
of damages sought not only in the body of the pleadings but also in the prayer in order to be
accepted and admitted for filing. Sun Insurance effectively modified SC Circular No. 7 by providing
that filing fees for damages and awards that cannot be estimated constitute liens on the awards
finally granted by the trial court.
x x x judgment awards which were left for determination by the court or as may be proven during
trial would still be subject to additional filing fees which shall constitute a lien on the judgment. It
would then be the responsibility of the Clerk of Court of the trial court or his duly-authorized deputy
to enforce said lien and assess and collect the additional fees.32
A reading of the allegations in the complaint would show that the amount of the rental due can
only be determined after a final judgment, since there is a need to show supporting evidence when
the petitioner and the other defendants started to possess the subject land. Thus, we find no
reversible error committed by the CA when it ruled that there was no grave abuse of discretion
committed by the RTC in issuing its Order dated March 30, 2000, where the RTC stated that
"since there was no hearing yet, respondents are not in a position to determine how much is to be
charged and that after hearing, the Clerk of Court determines that the filing fee is still insufficient,
the same shall be considered as lien on the judgment that may be entered."
Petitioner claims that the action is barred by extraordinary acquisitive prescription and laches.
Petitioner contends that she took possession of the land in the concept of an owner, open,
exclusive, notorious and continuous since 1952 through her predecessor-in-interest, Eugenio, and
by herself up to the present; that the late Fernando and private respondents had never taken
possession of the land at any single moment; and that, granting without admitting that the transfer
of rights between Fernando and Eugenio was null and void for any reason whatsoever, petitioner's
possession of the land had already ripened into ownership after the lapse of 30 years from August
1952 by virtue of the extraordinary acquisitive prescription.
We are not persuaded.
It is a well-entrenched rule in this jurisdiction that no title to registered land in derogation of the
rights of the registered owner shall be acquired by prescription or adverse
possession.33 Prescription is unavailing not only against the registered owner but also against his
hereditary successors.34 In this case, the parcel of land subject of this case is a titled property, i.e.,
titled in the name of the late Fernando Castor, married to Rosario Dideles.
Petitioner claims that respondent had impliedly admitted the fact of sale by Fernando to Eugenio
in August 1952, but only according to respondents, the sale was null and void because it violated
the provisions of the Public Land Act. Petitioner argues that the application of Fernando, dated
January 17, 1952, was not the homestead application referred to in Sections 118 and 124 of the
Public Land Act; and that Fernando's application was only as settler, or for the allocation of the
subject land to him vice the original settler Cadiente.
Such argument does not persuade.
The trial in this case has not yet started as in fact no answer has yet been filed. We find that these
issues are factual which must be resolved at the trial of this case on the merits wherein both
parties will be given ample opportunity to prove their respective claims and defenses.
Anent petitioner's defense of laches, the same is evidentiary in nature and cannot be established
by mere allegations in the pleadings. Without solid evidentiary basis, laches cannot be a valid
ground to dismiss respondents' complaint.35 Notably, the allegations of respondents in their
petition filed before the RTC which alleged among others:
7. That sometime between the years 1965 to 1970, defendant Ceferina de Ungria,
accompanied by Miss Angela Jagna-an, appeared in the residence of plaintiff Rosario
Dideles Vda. de Castor in Bo.1, Banga, South Cotabato, and requested her to sign a
folded document with her name only appearing thereon, telling her that it has something
to do with the land above-described, of which she refused telling her that she better return
it to the person who requested her to do so (referring to her mother-in-law), more so that
her husband was out at that time;
8. That when the matter was brought home to Fernando Castor, the latter just commented
that [his] mother desires the land above-described to be sold to defendant Ceferina de
Ungria which however he was opposed to do so even as they occasionally come into
heated arguments everytime this insistence on the same subject propped up;
9. That even after the death of the mother of the late Fernando Castor in Bo. Bula, City of
General Santos, sometime in 1980, the latter and his surviving wife thought all the while
that the land above-described was in the enjoyment of his late mother's family with his
2nd husband; that it was only after sometime when plaintiff Rosario Dideles Vda. de
Castor heard that the land above-described had even been leased by defendant Ceferina
de Ungria with the Stanfilco and Checkered farm;
10. That sometime in 1997, defendant Ceferina de Ungria sent overtures to plaintiffs
through Ester Orejana, who is the half sister-in-law of plaintiff Rosario Dideles Vda. de
Castor that she desires to settle with them relating to the land above-described; that the
overtures developed into defendant Ceferina de Ungria meeting for the purpose plaintiff
Ferolyn Castor Facurib where the negotiation continued with Lolita Javier as attorney-in-
fact after defendant Ceferina de Ungria left to reside in Manila and which resulted later to
the attorney-in-fact offering the plaintiffs ₱100,000.00 to quitclaim on their rights over the
said land, which offer, however, was refused by plaintiffs as so [insignificant] as compared
to the actual value of the same land; that in that negotiation, defendant Ceferina de
Ungria was challenged to show any pertinent document to support her claim on the land
in question and where she meekly answered by saying at the time that she does not have
any of such document;
x x x x36
would not conclusively establish laches.1avvphil Thus, it is necessary for petitioners to proceed to
trial and present controverting evidence to prove the elements of laches.
WHEREFORE, the petition for review is DENIED.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 208232 March 10, 2014
SURVIVING HEIRS OF ALFREDO R. BAUTISTA, namely: EPIFANIA G. BAUTISTA and ZOEY
G. BAUTISTA,Petitioners,
vs.
FRANCISCO LINDO and WELHILMINA LINDO; and HEIRS OF FILIPINA DAQUIGAN, namely:
MA. LOURDES DAQUIGAN, IMELDA CATHERINE DAQUIGAN, IMELDA DAQUIGAN and
CORSINO DAQUIGAN, REBECCA QUIAMCO and ANDRES QUIAMCO, ROMULO LORICA
and DELIA LORICA, GEORGE CAJES and LAURA CAJES, MELIDA BANEZ and FRANCISCO
BANEZ, MELANIE GOFREDO, GERV ACIO CAJES and ISABEL CAJES, EGMEDIO SEGOVIA
and VERGINIA SEGOVIA, ELSA N. SAM, PEDRO M. SAM and LINA SAM, SANTIAGO
MENDEZ and MINA MENDEZ, HELEN M. BURTON and LEONARDO BURTON, JOSE
JACINTO and BIENVENIDA JACINTO, IMELDA DAQUIGAN, LEO MA TIGA and ALICIA
MATIGA, FLORENCIO ACEDO JR., and LYLA VALERIO, Respondents.
DECISION
VELASCO, JR., J.:
The Case
This is a Petition for Review on Certiorari under Rule 45 assailing the April 25, 2013 Order of the
Regional Trial Court (RTC) in Civil Case No. (1798)-021 as well as its Order of July 3, 2013
denying reconsideration.
The Facts
Alfredo R. Bautista (Bautista), petitioner’s predecessor, inherited in 1983 a free-patent land
located in Poblacion, Lupon, Davao Oriental and covered by Original Certificate of Title (OCT) No.
(1572) P-6144. A few years later, he subdivided the property and sold it to several vendees,
herein respondents, via a notarized deed of absolute sale dated May 30, 1991. Two months later,
OCT No. (1572) P-6144 was canceled and Transfer Certificates of Title (TCTs) were issued in
favor of the vendees.1
Three years after the sale, or on August 5, 1994, Bautista filed a complaint for repurchase against
respondents before the RTC, Branch 32, Lupon, Davao Oriental, docketed as Civil Case No.
1798,2 anchoring his cause of action on Section 119 of Commonwealth Act No. (CA) 141,
otherwise known as the "Public Land Act," which reads:
SECTION 119. Every conveyance of land acquired under the free patent or homestead provisions,
when proper, shall be subject to repurchase by the applicant, his widow, or legal heirs, within a
period of five years from the date of the conveyance.
Respondents, in their Answer, raised lack of cause of action, estoppel, prescription, and laches,
as defenses.
Meanwhile, during the pendency of the case, Bautista died and was substituted by petitioner
Epifania G. Bautista (Epifania).
Respondents Francisco and Welhilmina Lindo later entered into a compromise agreement with
petitioners, whereby they agreed to cede to Epifania a three thousand two hundred and thirty
square meter (3,230 sq.m.)-portion of the property as well as to waive, abandon, surrender, and
withdraw all claims and counterclaims against each other. The compromise was approved by the
RTC in its Decision dated January 27, 2011, the fallo of which reads:
WHEREFORE, a DECISION is hereby rendered based on the above-quoted Compromise
Agreement and the parties are enjoined to strictly comply with the terms and conditions of the
same.
SO ORDERED.3
Other respondents, however, filed a Motion to Dismiss4 dated February 4, 2013, alleging that the
complaint failed to state the value of the property sought to be recovered. Moreover, they asserted
that the total selling price of all the properties is only sixteen thousand five hundred pesos (PhP
16,500), and the selling price or market value of a property is always higher than its assessed
value. Since Batas Pambansa Blg. (BP) 129, as amended, grants jurisdiction to the RTCs over
civil actions involving title to or possession of real property or interest therein where the assessed
value is more than PhP 20,000, then the RTC has no jurisdiction over the complaint in question
since the property which Bautista seeks to repurchase is below the PhP 20,000 jurisdictional
ceiling.
RTC Ruling5
Acting on the motion, the RTC issued the assailed order dismissing the complaint for lack of
jurisdiction. The trial court found that Bautista failed to allege in his complaint that the value of the
subject property exceeds 20 thousand pesos. Furthermore, what was only stated therein was that
the total and full refund of the purchase price of the property is PhP 16,500. This omission was
considered by the RTC as fatal to the case considering that in real actions, jurisdictional amount is
determinative of whether it is the municipal trial court or the RTC that has jurisdiction over the
case.
With respect to the belated filing of the motion, the RTC, citing Cosco Philippines Shipping, Inc. v.
Kemper Insurance Company,6 held that a motion to dismiss for lack of jurisdiction may be filed at
any stage of the proceedings, even on appeal, and is not lost by waiver or by estoppel. The
dispositive portion of the assailed Order reads:
WHEREFORE, the complaint for Repurchase, Consignation, with Preliminary Injunction and
Damages is hereby dismissed for lack of jurisdiction.
SO ORDERED.7
Assignment of Errors
Their motion for reconsideration having been denied, petitioners now seek recourse before this
Court with the following assigned errors:
I jurisdiction:
THE PUBLIC RESPONDENT RTC ERRED IN ADMITTING THE MOTION TO DISMISS DATED
FEBRUARY 4, 2013, BELATEDLY FILED BY THE PRIVATE RESPONDENTS IN THE CASE.
II
THE PUBLIC RESPONDENT RTC ERRED IN HOLDING THAT THE INSTANT CASE FOR
REPURCHASE IS A REAL ACTION.8
The Issue
Stated differently, the issue for the Court’s resolution is: whether or not the RTC erred in granting
the motion for the dismissal of the case on the ground of lack of jurisdiction over the subject
matter.
Arguments
Petitioners argue that respondents belatedly filed their Motion to Dismiss and are now estopped
from seeking the dismissal of the case, it having been filed nine (9) years after the filing of the
complaint and after they have actively participated in the proceedings. Additionally, they allege
that an action for repurchase is not a real action, but one incapable of pecuniary estimation, it
being founded on privity of contract between the parties. According to petitioners, what they seek
is the enforcement of their right to repurchase the subject property under Section 119 of CA 141.
Respondents, for their part, maintain that since the land is no longer devoted to agriculture, the
right of repurchase under said law can no longer be availed of, citing Santana v.
Mariñas.9 Furthermore, they suggest that petitioners intend to resell the property for a higher profit,
thus, the attempt to repurchase. This, according to respondents, goes against the policy and is not
in keeping with the spirit of CA 141 which is the preservation of the land gratuitously given to
patentees by the State as a reward for their labor in cultivating the property. Also, the Deed of
Absolute Sale presented in evidence by Bautista was unilaterally executed by him and was not
signed by respondents. Lastly, respondents argue that repurchase is a real action capable of
pecuniary estimation.
Our Ruling
The petition is meritorious.
Jurisdiction of courts is granted by the Constitution and pertinent laws.
Jurisdiction of RTCs, as may be relevant to the instant petition, is provided in Sec. 19 of BP 129,
which reads:
Sec. 19. Jurisdiction in civil cases.―Regional Trial Courts shall exercise exclusive original
1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
2) In all civil actions which involve the title to, or possession of, real property, or any
interest therein, where the assessed value of the property involved exceeds Twenty
thousand pesos (₱20,000.00) or, for civil actions in Metro Manila, where such value
exceeds Fifty thousand pesos (₱50,000.00) except actions for forcible entry into and
unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon
the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts.
On the other hand, jurisdiction of first level courts is prescribed in Sec. 33 of BP 129, which
provides:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts in civil cases.―Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial
Courts shall exercise:
xxxx
3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where the assessed value of the property or interest therein does
not exceed Twenty thousand pesos (₱20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty thousand pesos (₱50,000.00) exclusive of interest,
damages of whatever kind, attorney’s fees, litigation expenses and costs: Provided, That in cases
of land not declared for taxation purposes, the value of such property shall be determined by the
assessed value of the adjacent lots.
The core issue is whether the action filed by petitioners is one involving title to or possession of
real property or any interest therein or one incapable of pecuniary estimation.
The course of action embodied in the complaint by the present petitioners’ predecessor, Alfredo R.
Bautista, is to enforce his right to repurchase the lots he formerly owned pursuant to the right of a
free-patent holder under Sec. 119 of CA 141 or the Public Land Act.
The Court rules that the complaint to redeem a land subject of a free patent is a civil action
incapable of pecuniary estimation.
It is a well-settled rule that jurisdiction of the court is determined by the allegations in the complaint
and the character of the relief sought.10 In this regard, the Court, in Russell v. Vestil,11 wrote that
"in determining whether an action is one the subject matter of which is not capable of pecuniary
estimation this Court has adopted the criterion of first ascertaining the nature of the principal
action or remedy sought. If it is primarily for the recovery of a sum of money, the claim is
considered capable of pecuniary estimation, and whether jurisdiction is in the municipal courts or
in the RTCs would depend on the amount of the claim." But where the basic issue is something
other than the right to recover a sum of money, where the money claim is purely incidental to, or a
consequence of, the principal relief sought, this Court has considered such actions as cases
where the subject of the litigation may not be estimated in terms of money, and, hence, are
incapable of pecuniary estimation. These cases are cognizable exclusively by RTCs.12
Settled jurisprudence considers some civil actions as incapable of pecuniary estimation, viz:
1. Actions for specific performance;
2. Actions for support which will require the determination of the civil status;
3. The right to support of the plaintiff;
4. Those for the annulment of decisions of lower courts;
5. Those for the rescission or reformation of contracts;13
6. Interpretation of a contractual stipulation.14
The Court finds that the instant cause of action to redeem the land is one for specific performance.
The facts are clear that Bautista sold to respondents his lots which were covered by a free patent.
While the deeds of sale do not explicitly contain the stipulation that the sale is subject to
repurchase by the applicant within a period of five (5) years from the date of conveyance pursuant
to Sec. 119 of CA 141, still, such legal provision is deemed integrated and made part of the deed
of sale as prescribed by law. It is basic that the law is deemed written into every
contract.15 Although a contract is the law between the parties, the provisions of positive law which
regulate contracts are deemed written therein and shall limit and govern the relations between the
parties.16 Thus, it is a binding prestation in favor of Bautista which he may seek to enforce. That is
precisely what he did. He filed a complaint to enforce his right granted by law to recover the lot
subject of free patent. Ergo, it is clear that his action is for specific performance, or if not strictly
such action, then it is akin or analogous to one of specific performance. Such being the case, his
action for specific performance is incapable of pecuniary estimation and cognizable by the RTC.
Respondents argue that Bautista’s action is one involving title to or possession of real property or
any interests therein and since the selling price is less than PhP 20,000, then jurisdiction is lodged
with the MTC. They rely on Sec. 33 of BP 129.
Republic Act No. 769117 amended Sec. 33 of BP 129 and gave Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts exclusive original jurisdiction in all civil
actions which involve title to, or possession of, real property, or any interest therein where the
assessed value of the property or interest therein does not exceed twenty thousand pesos (PhP
20,000) or, in civil actions in Metro Manila, where such assessed value does not exceed fifty
thousand pesos (PhP 50,000) exclusive of interest, damages of whatever kind, attorney’s fees,
litigation expenses and costs.
At first blush, it appears that the action filed by Bautista involves title to or possession of the lots
he sold to respondents. Since the total selling price is less than PhP 20,000, then the MTC, not
the RTC, has jurisdiction over the case. This proposition is incorrect for the re-acquisition of the
lots by Bautista or herein successors-in-interests, the present petitioners, is but incidental to and
an offshoot of the exercise of the right by the latter to redeem said lots pursuant to Sec. 119 of CA
141. The reconveyance of the title to petitioners is solely dependent on the exercise of such right
to repurchase the lots in question and is not the principal or main relief or remedy sought. Thus,
the action of petitioners is, in reality, incapable of pecuniary estimation, and the reconveyance of
the lot is merely the outcome of the performance of the obligation to return the property
conformably to the express provision of CA 141.
Even if we treat the present action as one involving title to real property or an interest therein
which falls under the jurisdiction of the first level court under Sec. 33 of BP 129, as the total selling
price is only PhP 16,000 way below the PhP 20,000 ceiling, still, the postulation of respondents
that MTC has jurisdiction will not hold water. This is because respondents have actually
participated in the proceedings before the RTC and aggressively defended their position, and by
virtue of which they are already barred to question the jurisdiction of the RTC following the
principle of jurisdiction by estoppel.
In Heirs of Jose Fernando v. De Belen, it was held that the party raising defenses to the complaint,
actively participating in the proceedings by filing pleadings, presenting his evidence, and invoking
its authority by asking for an affirmative relief is deemed estopped from questioning the jurisdiction
of the court.18
Here, we note that aside from the belated filing of the motion to dismiss––it having been filed nine
(9) years from the filing of the complaint––respondents actively participated in the proceedings
through the following acts:
1. By filing their Answer and Opposition to the Prayer for Injunction19 dated September 29,
1994 whereby they even interposed counterclaims, specifically: PhP 501,000 for unpaid
survey accounts, PhP 100,000 each as litigation expenses, PhP 200,000 and PhP 3,000
per daily appearance by way of attorney’s fees, PhP 500,000 as moral damages, PhP
100,000 by way of exemplary damages, and costs of suit;
2. By participating in Pre-trial;
 3. By moving for the postponement of their presentation of evidence;20

4. By presenting their witness;21 and

5. By submitting the compromise agreement for approval.22

Having fully participated in all stages of the case, and even invoking the RTC’s authority by asking
for affirmative reliefs, respondents can no longer assail the jurisdiction of the said trial court.
Simply put, considering the extent of their participation in the case, they are, as they should be,
considered estopped from raising lack of jurisdiction as a ground for the dismissal of the
action.1âwphi1

WHEREFORE, premises considered, the instant petition is hereby GRANTED. The April 25, 2013
and July 3, 2013 Orders of the Regional Trial Court in Civil Case No. (1798)-021 are hereby
REVERSED and SET ASIDE.

The Regional Trial Court, Branch 32 in Lupon, Davao Oriental is ORDERED to proceed with
dispatch in resolving Civil Case No. (1798)-021.

No pronouncement as to costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
SECOND DIVISION
G.R. No. 160384. April 29, 2005
CESAR T. HILARIO, for himself and as Attorney-in-Fact of IBARRA, NESTOR, LINA and
PRESCILLA, all surnamed HILARIO, Petitioners,
vs.
ALLAN T. SALVADOR, Respondents.
HEIRS OF SALUSTIANO SALVADOR, namely, REGIDOR M. SALVADOR and VIRGINIA
SALVADOR-LIM,respondents-intervenors.
DECISION
CALLEJO, SR., J.:
This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court of the
Decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 63737 as well as its Resolution2 denying
the motion for the reconsideration of the said decision.
The Antecedents
On September 3, 1996, petitioners Cesar, Ibarra, Nestor, Lina and Prescilla, all surnamed Hilario,
filed a complaint with the Regional Trial Court (RTC) of Romblon, Romblon, Branch 71, against
private respondent Allan T. Salvador. They alleged therein, inter alia, as follows:
2. That, the plaintiffs are co-owners by inheritance from Concepcion Mazo Salvador of a parcel of
land designated as Cad. Lot No. 3113-part, located at Sawang, Romblon, Romblon, which
property was [adjudged] as the hereditary share of their father, Brigido M. Hilario, Jr. when their
father was still single, and which adjudication was known by the plaintiffs[’] father’s co-heirs;
3. That, sometime in 1989, defendant constructed his dwelling unit of mixed materials on the
property of the plaintiffs’ father without the knowledge of the herein plaintiffs or their predecessors-
in-interest;
4. That, demands have been made of the defendant to vacate the premises but the latter
manifested that he have (sic) asked the prior consent of their grandmother, Concepcion Mazo
Salvador;
5. That, to reach a possible amicable settlement, the plaintiffs brought the matter to the Lupon of
Barangay Sawang, to no avail, evidenced by the CERTIFICATE TO FILE ACTION hereto attached
as ANNEX B;
6. That, the unjustified refusal of the defendant to vacate the property has caused the plaintiffs to
suffer shame, humiliation, wounded feelings, anxiety and sleepless nights;
7. That, to protect their rights and interest, plaintiffs were constrained to engage the services of a
lawyer.3
The petitioners prayed that, after due proceedings, judgment be rendered in their favor, thus:
WHEREFORE, it is prayed of this Honorable Court that after due process (sic), an order be issued
for the defendant to vacate and peacefully turn over to the plaintiffs the occupied property and that
defendant be made to pay plaintiffs:
a. actual damages, as follows:
a.1. transportation expenses in connection with the projected settlement of the case amounting to
₱1,500.00 and for the subsequent attendance to the hearing of this case at ₱1,500.00 each
schedule;
a.2. attorney’s fees in the amount of ₱20,000.00 and ₱500.00 for every court appearance;
b. moral and exemplary damages in such amount incumbent upon the Honorable Court to
determine; and
c. such other relief and remedies just and equitable under the premises.4
The private respondent filed a motion to dismiss the complaint on the ground of lack of jurisdiction
over the nature of the action, citing Section 33 of Batas Pambansa (B.P.) Blg. 129, as amended by
Section 3(3) of Republic Act (R.A.) No. 7691.5 He averred that –
(1) the complaint failed to state the assessed value of the land in dispute;
(2) the complaint does not sufficiently identify and/or describe the parcel of land referred to as the
subject-matter of this action;
both of which are essential requisites for determining the jurisdiction of the Court where the case is
filed. In this case, however, the assessed value of the land in question is totally absent in the
allegations of the complaint and there is nothing in the relief prayed for which can be picked-up for
determining the Court’s jurisdiction as provided by law.
In the face of this predicament, it can nevertheless be surmised by reading between the lines, that
the assessed value of the land in question cannot exceed ₱20,000.00 and, as such, it falls within
the jurisdiction of the Municipal Trial Court of Romblon and should have been filed before said
Court rather than before the RTC. …6
The petitioners opposed the motion.7 They contended that the RTC had jurisdiction over the action
since the court can take judicial notice of the market value of the property in question, which was
₱200.00 per square meter and considering that the property was 14,797 square meters, more or
less, the total value thereof is ₱3,500,000.00. Besides, according to the petitioners, the motion to
dismiss was premature and "the proper time to interpose it is when the [petitioners] introduced
evidence that the land is of such value."
On November 7, 1996, the RTC issued an Order8 denying the motion to dismiss, holding that the
action was incapable of pecuniary estimation, and therefore, cognizable by the RTC as provided in
Section 19(1) of B.P. Blg. 129, as amended.
After the denial of the motion to dismiss, the private respondent filed his answer with
counterclaim.9 Traversing the material allegations of the complaint, he contended that the
petitioners had no cause of action against him since the property in dispute was the conjugal
property of his grandparents, the spouses Salustiano Salvador and Concepcion Mazo-Salvador.
On April 8, 1997, Regidor and Virginia Salvador filed their Answer-in-Intervention10 making
common cause with the private respondent. On her own motion, however, Virginia Salvador was
dropped as intervenor.11
During trial, the petitioners adduced in evidence Tax Declaration No. 8590-A showing that in 1991
the property had an assessed value of ₱5,950.00.12
On June 3, 1999, the trial court rendered judgment finding in favor of the petitioners. The
dispositive portion of the decision reads:
WHEREFORE, as prayed for, judgment is rendered:
Ordering the defendant to vacate and peacefully turn over to the plaintiffs the occupied property;
and
Dismissing defendant’s counterclaim.
SO ORDERED.13
Aggrieved, the private respondent and respondent-intervenor Regidor Salvador appealed the
decision to the CA, which rendered judgment on May 23, 2003 reversing the ruling of the RTC and
dismissing the complaint for want of jurisdiction. The fallo of the decision is as follows:
IN VIEW OF THE FOREGOING, the appealed decision is REVERSED, and the case DISMISSED,
without prejudice to its refilling in the proper court.
SO ORDERED.14
The CA declared that the action of the petitioners was one for the recovery of ownership and
possession of real property. Absent any allegation in the complaint of the assessed value of the
property, the Municipal Trial Court (MTC) had exclusive jurisdiction over the action, conformably to
Section 3315 of R.A. No. 7691.
The petitioners filed a motion for reconsideration of the said decision, which the appellate court
denied.16 Hence, they filed the instant petition, with the following assignment of errors:
I
THE HONORABLE COURT OF APPEALS COMMITTED GRAVE REVERSIBLE ERROR IN
HOLDING THAT THE INSTANT CASE, ACCION REINVINDICATORIA, FALLS WITHIN THE
EXCLUSIVE ORIGINAL JURISDICTION OF THE MUNICIPAL TRIAL COURT OF ROMBLON,
AND NOT WITH THE REGIONAL TRIAL COURT OF ROMBLON.
II
THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS REVERSIBLE ERROR IN
ORDERING THE REFILING OF THE CASE IN THE [PROPER] COURT, INSTEAD OF
DECIDING THE CASE ON THE MERITS BASED ON THE COMPLETE RECORDS ELEVATED
BEFORE SAID APPELLATE COURT AND IN NOT AFFIRMING IN TOTO THE DECISION OF
THE TRIAL COURT.17
The Ruling of the Court
The lone issue for our resolution is whether the RTC had jurisdiction over the action of the
petitioners, the plaintiffs in the RTC, against the private respondent, who was the defendant
therein.
The petitioners maintain that the RTC has jurisdiction since their action is an accion
reinvindicatoria, an action incapable of pecuniary estimation; thus, regardless of the assessed
value of the subject property, exclusive jurisdiction falls within the said court. Besides, according to
the petitioners, in their opposition to respondent’s motion to dismiss, they made mention of the
increase in the assessed value of the land in question in the amount of ₱3.5 million. Moreover, the
petitioners maintain that their action is also one for damages exceeding ₱20,000.00, over which
the RTC has exclusive jurisdiction under R.A. No. 7691.
The petition has no merit.
It bears stressing that the nature of the action and which court has original and exclusive
jurisdiction over the same is determined by the material allegations of the complaint, the type of
relief prayed for by the plaintiff and the law in effect when the action is filed, irrespective of
whether the plaintiffs are entitled to some or all of the claims asserted therein. 18 The caption of the
complaint is not determinative of the nature of the action. Nor does the jurisdiction of the court
depend upon the answer of the defendant or agreement of the parties or to the waiver or
acquiescence of the parties.
We do not agree with the contention of the petitioners and the ruling of the CA that the action of
the petitioners in the RTC was an accion reinvindicatoria. We find and so rule that the action of the
petitioners was an accion publiciana, or one for the recovery of possession of the real property
subject matter thereof. An accion reinvindicatoria is a suit which has for its object the recovery of
possession over the real property as owner. It involves recovery of ownership and possession
based on the said ownership. On the other hand, an accion publiciana is one for the recovery of
possession of the right to possess. It is also referred to as an ejectment suit filed after the
expiration of one year after the occurrence of the cause of action or from the unlawful withholding
of possession of the realty.19
The action of the petitioners filed on September 3, 1996 does not involve a claim of ownership
over the property. They allege that they are co-owners thereof, and as such, entitled to its
possession, and that the private respondent, who was the defendant, constructed his house
thereon in 1989 without their knowledge and refused to vacate the property despite demands for
him to do so. They prayed that the private respondent vacate the property and restore possession
thereof to them.
When the petitioners filed their complaint on September 3, 1996, R.A. No. 7691 was already in
effect. Section 33(3) of the law provides:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts in Civil Cases. – Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit
Trial Courts shall exercise:
… We quote with approval, in this connection, the CA’s disquisition:
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where the assessed value of the property or interest therein does
not exceed Twenty Thousand Pesos (₱20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty Thousand Pesos (₱50,000.00) exclusive of interest,
damages of whatever kind, attorney’s fees, litigation expenses and costs: Provided, That in cases
of land not declared for taxation purposes, the value of such property shall be determined by the
assessed value of the adjacent lots.
Section 19(2) of the law, likewise, provides that:
Sec. 19. Jurisdiction in civil cases. – The Regional Trial Court shall exercise exclusive original
jurisdiction:
…
(2) In all civil actions, which involve the title to, or possession of, real property, or any interest
therein, where the assessed value of the property involved exceeds Twenty Thousand Pesos
(₱20,000.00) or, for civil actions in Metro Manila, where such value exceeds Fifty Thousand Pesos
(₱50,000.00) except actions for forcible entry into and unlawful detainer of lands or buildings,
original jurisdiction over which is conferred upon the Metropolitan Trial Courts, Municipal Trial
Courts, and Municipal Circuit Trial Courts.
The jurisdiction of the court over an action involving title to or possession of land is now
determined by the assessed value of the said property and not the market value thereof. The
assessed value of real property is the fair market value of the real property multiplied by the
assessment level. It is synonymous to taxable value.20 The fair market value is the price at which a
property may be sold by a seller, who is not compelled to sell, and bought by a buyer, who is not
compelled to buy.
Even a cursory reading of the complaint will show that it does not contain an allegation stating the
assessed value of the property subject of the complaint.21 The court cannot take judicial notice of
the assessed or market value of lands.22 Absent any allegation in the complaint of the assessed
value of the property, it cannot thus be determined whether the RTC or the MTC had original and
exclusive jurisdiction over the petitioners’ action.
We note that during the trial, the petitioners adduced in evidence Tax Declaration No. 8590-A,
showing that the assessed value of the property in 1991 was ₱5,950.00. The petitioners, however,
did not bother to adduce in evidence the tax declaration containing the assessed value of the
property when they filed their complaint in 1996. Even assuming that the assessed value of the
property in 1991 was the same in 1995 or 1996, the MTC, and not the RTC had jurisdiction over
the action of the petitioners since the case involved title to or possession of real property with an
assessed value of less than ₱20,000.00.23
The determining jurisdictional element for the accion reinvindicatoria is, as RA 7691 discloses, the
assessed value of the property in question. For properties in the provinces, the RTC has
jurisdiction if the assessed value exceeds ₱20,000, and the MTC, if the value is ₱20,000 or below.
An assessed value can have reference only to the tax rolls in the municipality where the property
is located, and is contained in the tax declaration. In the case at bench, the most recent tax
declaration secured and presented by the plaintiffs-appellees is Exhibit B. The loose remark made
by them that the property was worth 3.5 million pesos, not to mention that there is absolutely no
evidence for this, is irrelevant in the light of the fact that there is an assessed value. It is the
amount in the tax declaration that should be consulted and no other kind of value, and as
appearing in Exhibit B, this is ₱5,950. The case, therefore, falls within the exclusive original
jurisdiction of the Municipal Trial Court of Romblon which has jurisdiction over the territory where
the property is located, and not the court a quo.24
It is elementary that the tax declaration indicating the assessed value of the property enjoys the
presumption of regularity as it has been issued by the proper government agency.25
Unavailing also is the petitioners’ argumentation that since the complaint, likewise, seeks the
recovery of damages exceeding ₱20,000.00, then the RTC had original jurisdiction over their
actions. Section 33(3) of B.P. Blg. 129, as amended, quoted earlier, explicitly excludes from the
determination of the jurisdictional amount the demand for "interest, damages of whatever kind,
attorney’s fees, litigation expenses, and costs." This Court issued Administrative Circular No. 09-
94 setting the guidelines in the implementation of R.A. No. 7691, and paragraph 2 thereof states
that –

2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional amount
under Section 19(8) and Section 33(1) of B.P. Blg. 129, as amended by R.A. 7691, applies to
cases where the damages are merely incidental to or a consequence of the main cause of action.
However, in cases where the claim for damages is the main cause of action, or one of the causes
of action, the amount of such claim shall be considered in determining the jurisdiction of the court.

Neither may the petitioners find comfort and solace in Section 19(8) of B.P. Blg. 129, as amended,
which states:

SEC. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
jurisdiction:

(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses, and costs or the value of the property in controversy exceeds
One Hundred Thousand Pesos (₱100,000.00) or, in such other cases in Metro Manila, where the
demand, exclusive of the above-mentioned items exceeds Two Hundred Thousand Pesos
(₱200,000.00).

The said provision is applicable only to "all other cases" other than an action involving title to, or
possession of real property in which the assessed value is the controlling factor in determining the
court’s jurisdiction. The said damages are merely incidental to, or a consequence of, the main
cause of action for recovery of possession of real property.26

Since the RTC had no jurisdiction over the action of the petitioners, all the proceedings therein,
including the decision of the RTC, are null and void. The complaint should perforce be
dismissed.27

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. CV No. 63737 are AFFIRMED. Costs against the petitioners.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 164560 July 22, 2009
ANA DE GUIA SAN PEDRO and ALEJO DOPEÑO, Petitioners,
vs.
HON. FATIMA G. ASDALA, in her capacity as the Presiding Judge of the Regional Trial
Court of Quezon City, Branch 87; HON. MANUEL TARO, in his capacity as the Presiding
Judge of the Metropolitan Trial Court of Quezon City, Branch 42; and the HEIRS OF
SPOUSES APOLONIO V. DIONISIO and VALERIANA DIONISIO (namely, ALLAN GEORGE R.
DIONISIO and ELEANOR R. DIONISIO, herein represented by ALLAN GEORGE R.
DIONISIO), Respondents.
DECISION
DEL CASTILLO, J.:
This resolves the petition for certiorari under Rule 65 of the Rules of Court, praying that the
Resolutions1 of the Court of Appeals (CA) dated September 15, 2003 and June 1, 2004,
respectively, in CA-G.R. SP No. 78978, be reversed and set aside.
The antecedent facts are as follows.
Sometime in July 2001, private respondents, heirs of spouses Apolonio and Valeriana Dionisio,
filed with the Metropolitan Trial Court (MeTC) of Quezon City, Branch 42, a Complaint 2 against
herein petitioners and Wood Crest Residents Association, Inc., for Accion Reivindicatoria, Quieting
of Title and Damages, with Prayer for Preliminary Mandatory Injunction. Private respondents
alleged that subject property located in Batasan Hills, Quezon City, with an assessed value of
₱32,100.00, was titled in the name of spouses Apolonio and Valeriana Dionisio; but petitioners,
with malice and evident bad faith, claimed that they were the owners of a parcel of land that
encompasses and covers subject property. Private respondents had allegedly been prevented
from entering, possessing and using subject property. It was further alleged in the Complaint that
petitioners' Transfer Certificate of Title over their alleged property was spurious. Private
respondents then prayed that they be declared the sole and absolute owners of the subject
property; that petitioners be ordered to surrender possession of subject property to them; that
petitioners and Wood Crest and/or its members be ordered to pay actual and moral damages, and
attorney's fees.
Petitioners, for their part, filed a Motion to Dismiss3 said complaint on the ground that the MeTC
had no jurisdiction over the subject matter of the action, as the subject of litigation was incapable
of pecuniary estimation.
The MeTC then issued an Order4 dated July 4, 2002 denying the motion to dismiss, ruling that,
under Batas Pambansa (B.P.) Blg. 129, as amended, the MeTC had exclusive original jurisdiction
over actions involving title to or possession of real property of small value.
Petitioners' Motion for Reconsideration of said Order dated July 4, 2002 was denied.
Petitioners assailed the aforementioned Order by filing a petition for certiorari with the Regional
Trial Court (RTC) of Quezon City, Branch 87. However, in its Decision 5 dated March 10, 2003, the
RTC dismissed the petition, finding no grave abuse of discretion on the part of the MeTC Presiding
Judge. The RTC sustained the MeTC ruling, stating that, in accordance with Section 33(3) of
Republic Act (R.A.) No. 7691, amending B.P. Blg. 129, the MeTC had jurisdiction over the
complaint for Accion Reivindicatoria, as it involves recovery of ownership and possession of real
property located in Quezon City, with an assessed value not exceeding ₱50,000.00. A Motion for
Reconsideration6of the Decision was filed by petitioners, but was denied in an Order7 dated July 3,
2003.
Petitioners then filed with the Court of Appeals another petition for certiorari, insisting that both the
MeTC and RTC acted with grave abuse of discretion amounting to lack or excess of jurisdiction by
not ordering the dismissal of the complaint for Accion Reivindicatoria, for lack of jurisdiction over
the same. In the assailed CA Resolution dated September 15, 2003, the CA dismissed the petition
outright, holding that certiorari was not available to petitioners as they should have availed
themselves of the remedy of appeal. Petitioners' motion for reconsideration of the resolution of
dismissal was denied per Resolution8 dated June 1, 2004.
Thus, petitioners filed the instant petition and, in support thereof, they allege that:
THE HONORABLE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN DENYING THE PETITION
FOR CERTIORARI AND FOR FAILURE TO RESOLVE THE ISSUE RAISED IN THE
CERTIORARI REGARDING THE JURISDICTION OF THE METROPOLITAN TRIAL COURT TO
TAKE COGNIZANCE OF A CASE OF ACCION REINVINDICATORIA.
THE HONORABLE PUBLIC RESPONDENT FATIMA GONZALES-ASDALA, AS PRESIDING
JUDGE OF RTC BRANCH 87, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR IN EXCESS OF (SIC) JURISDICTION IN DISMISSING THE
PETITION FOR CERTIORARI AND IN RESOLVING THAT A CASE OF ACCION
REINVINDICATORIA IS WITHIN THE JURISDICTION OF THE METROPOLITAN TRIAL COURT.
THE HONORABLE PUBLIC RESPONDENT MANUEL TARO AS PRESIDING JUDGE MeTC,
BRANCH 42, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OR IN (SIC) EXCESS OF JURISDICTION IN SO TAKING COGNIZANCE OF THE
COMPLAINT FOR ACCION REINVINDICATORIA IN CIVIL CASE NO. 27434 ENTITLED, "HEIRS
OF SPS. APOLONIO V. DIONISIO AND VALERIANA DIONISIO, ETC. VS. ANA DE GUIA SAN
PEDRO, ET. AL."9
The present Petition for Certiorari is doomed and should not have been entertained from the very
beginning.
The settled rule is that appeals from judgments or final orders or resolutions of the CA should be
by a verified petition for review on certiorari, as provided for under Rule 45 of the Revised Rules of
Civil Procedure. Thus, in Pasiona, Jr. v. Court of Appeals,10 the Court expounded as follows:
The aggrieved party is proscribed from assailing a decision or final order of the CA via Rule 65,
because such recourse is proper only if the party has no plain, speedy and adequate remedy in
the course of law. In this case, petitioner had an adequate remedy, namely, a petition for review
on certiorari under Rule 45 of the Rules of Court. A petition for review on certiorari, not a special
civil action for certiorari was, therefore, the correct remedy.
xxxx
actions in Metro Manila, where such assessed value does not exceed Fifty thousand pesos
(₱50,000.00) exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses
and costs." Thus, under the present law, original jurisdiction over cases the subject matter
of which involves "title to, possession of, real property or any interest therein" under
Section 19(2) of B.P. 129 is divided between the first and second level courts, with the
assessed value of the real property involved as the benchmark. This amendment was
introduced to "unclog the overloaded dockets of the RTCs which would result in the speedier
administration of justice."13
Clearly, the RTC and the CA ruled correctly that the MeTC had jurisdiction over private
respondents' complaint for Accion Reivindicatoria.

Settled is the rule that where appeal is available to the aggrieved party, the special civil action for IN VIEW OF THE FOREGOING, the petition is DISMISSED for utter lack of merit. The Resolutions
certiorari will not be entertained – remedies of appeal and certiorari are mutually exclusive, not of the Court of Appeals in CA-G.R. SP No. 78978, dated September 15, 2003 and June 1, 2004,
alternative or successive. Hence, certiorari is not and cannot be a substitute for a lost appeal, are AFFIRMED.
especially if one's own negligence or error in one's choice of remedy occasioned such loss or
lapse. One of the requisites of certiorari is that there be no available appeal or any plain, speedy SO ORDERED.
and adequate remedy. Where an appeal was available, as in this case, certiorari will not
prosper, even if the ground therefor is grave abuse of discretion. Petitioner's resort to this
Court by Petition for Certiorari was a fatal procedural error, and the instant petition must, therefore,
fail.11

For the very same reason given above, the CA, therefore, acted properly when it dismissed the
petition for certiorari outright, on the ground that petitioners should have resorted to the remedy of
appeal instead of certiorari. Verily, the present Petition for Certiorari should not have been given
due course at all.

Moreover, since the period for petitioners to file a petition for review on certiorari had lapsed by the
time the instant petition was filed, the assailed CA Resolutions have attained finality.1avvphi1

Nevertheless, just to put the matter to rest, the Court reiterates the ruling in Heirs of Valeriano S.
Concha, Sr. v. Spouses Lumocso,12 to wit:

In a number of cases, we have held that actions for reconveyance of or for cancellation of title to
or to quiet title over real property are actions that fall under the classification of cases that involve
"title to, or possession of, real property, or any interest therein."

xxxx

x x x Thus, under the old law, there was no substantial effect on jurisdiction whether a case is one,
the subject matter of which was incapable of pecuniary estimation, under Section 19(1) of B.P.
129, or one involving title to property under Section 19(2). The distinction between the two classes
became crucial with the amendment introduced by R.A. No. 7691 in 1994, which expanded the
exclusive original jurisdiction of the first level courts to include "all civil actions which involve title
to, or possession of, real property, or any interest therein where the assessed value of the
property or interest therein does not exceed Twenty thousand pesos (₱20,000.00) or, in civil
 Respondents appealed to the Regional Trial Court (RTC) of La Trinidad, Benguet.

Republic of the Philippines After going over the MTC records and the parties’ respective memoranda, the RTC of La Trinidad,
SUPREME COURT Benguet, Branch 10, through Acting Presiding Judge Fernando P. Cabato (Judge Cabato), issued
Manila its October 22, 2003 Order,10declaring the MTC without jurisdiction over petitioner’s cause of
action. It further held that it will take cognizance of the case pursuant to Section 8, Rule 40 of the
SECOND DIVISION Rules of Court, which reads:

G.R. No. 174908 June 17, 2013 SECTION 8. Appeal from orders dismissing case without trial; lack of jurisdiction. – x x x

DARMA MASLAG, Petitioner, If the case was tried on the merits by the lower court without jurisdiction over the subject matter,
vs. the Regional Trial Court on appeal shall not dismiss the case if it has original jurisdiction thereof,
ELIZABETH MONZON, WILLIAM GESTON, and REGISTRY OF DEEDS OF but shall decide the case in accordance with the preceding section, without prejudice to the
BENGUET, Respondents. admission of amended pleadings and additional evidence in the interest of justice. Both parties
acknowledged receipt of the October 22, 2003 Order,11 but neither presented additional evidence
before the new judge, Edgardo B. Diaz De Rivera, Jr. (Judge Diaz De Rivera).12
DECISION
On May 4, 2004, Judge Diaz De Rivera issued a Resolution 13 reversing the MTC Decision. The
DEL CASTILLO, J.:
fallo reads as follows:

"It is incumbent upon x x x appellants to utilize the correct mode of appeal of the decisions of trial
WHEREFORE, the Judgment appealed from the Municipal Trial Court of La Trinidad, Benguet is
courts to the appellate courts. In the mistaken choice of their remedy, they can blame no one but
set aside. [Petitioner] is ordered to turn over the possession of the 4,415 square meter land she
themselves."1
presently occupies to [Monzon]. This case is remanded to the court a quo for further proceedings
to determine whether [Maslag] is entitled to the remedies afforded by law to a builder in good faith
This is a Petition for Review on Certiorari2 of the May 31, 2006 Resolution3 of the Court of Appeals for the improvements she constructed thereon.
(CA) in CA-G.R. CV No. 83365, which dismissed petitioner Darma Maslag's (petitioner) ordinary
appeal to it for being an improper remedy. The Resolution disposed of the case as follows:
No pronouncement as to damages and costs.

WHEREFORE, the Motion to Dismiss is GRANTED, and the Appeal is hereby DISMISSED. SO ORDERED.14

SO ORDERED.4
Petitioner filed a Notice of Appeal15 from the RTC’s May 4, 2004 Resolution.

The Petition also assails the CA’s September 22, 2006 Resolution 5 denying petitioner’s Motion for
Petitioner assailed the RTC’s May 4, 2004 Resolution for reversing the MTC’s factual
Reconsideration.6
findings16 and prayed that the MTC Decision be adopted. Her prayer before the CA reads:

Factual Antecedents
In 1998, petitioner filed a Complaint7 for reconveyance of real property with declaration of nullity of
original certificate of title (OCT) against respondents Elizabeth Monzon (Monzon), William Geston
and the Registry of Deeds of La Trinidad, Benguet. The Complaint was filed before the Municipal
Trial Court (MTC) of La Trinidad, Benguet.
After trial, the MTC found respondent Monzon guilty of fraud in obtaining an OCT over petitioner’s
property.8 It ordered her to reconvey the said property to petitioner, and to pay damages and costs
of suit.9
WHEREFORE, premises considered, it is most respectfully prayed that the decision of the
Regional Trial Court, Branch 10 of La Trinidad, Benguet, appealed from be reversed in toto and
that the Honorable Court adopt the decision of the Municipal Trial Court. Further reliefs just and
equitable under the premises are prayed for.17
Respondents moved to dismiss petitioner’s ordinary appeal for being the improper remedy. They
asserted that the proper mode of appeal is a Petition for Review under Rule 42 because the RTC
rendered its May 4, 2004 Resolution in its appellate jurisdiction.18
Ruling of the Court of Appeals
The CA dismissed petitioner’s appeal. It observed that the RTC’s May 4, 2004 Resolution (the
subject matter of the appeal before the CA) set aside an MTC Judgment; hence, the proper
remedy is a Petition for Review under Rule 42, and not an ordinary appeal.19
Petitioner sought reconsideration.20 She argued, for the first time, that the RTC rendered its May 4,
2004 Resolution in its original jurisdiction. She cited the earlier October 22, 2003 Order of the RTC
declaring the MTC without jurisdiction over the case.
The CA denied petitioner’s Motion for Reconsideration in its September 22, 2006 Resolution: 21
A perusal of the May 4, 2004 Resolution of the RTC, which is the subject matter of the appeal,
clearly reveals that it took cognizance of the MTC case in the exercise of its appellate jurisdiction.
Consequently, as We have previously enunciated, the proper remedy, is a petition for review
under Rule 42 and not an ordinary appeal under Rule 41.
WHEREFORE, premises considered, the instant Motion for Reconsideration is DENIED. The May
31, 2006 Resolution of this Court is hereby AFFIRMED in toto.
SO ORDERED.22
Hence this Petition wherein petitioner prays that the CA be ordered to take cognizance of her
appeal.23
Issues
Petitioner set forth the following issues in her Petition:
WHETHER X X X THE COURT OF APPEALS WAS CORRECT IN DISMISSING THE APPEAL
FILED BY THE PETITIONER, CONSIDERING THAT THE REGIONAL TRIAL COURT, BRANCH
10 OF LA TRINIDAD, BENGUET HELD THAT THE ORIGINAL COMPLAINT AS FILED BEFORE
THE MUNICIPAL TRIAL COURT OF LA TRINIDAD, BENGUET WAS DECIDED BY THE LATTER
WITHOUT ANY JURISDICTION AND, IN ORDERING THAT THE CASE SHALL BE DECIDED
PURSUANT TO THE PROVISION OF SECTION 8 OF RULE 40 OF THE RULES OF COURT, IT
DECIDED THE CASE NOT ON ITS APPELLATE JURISDICTION BUT ON ITS ORIGINAL
JURISDICTION WHAT WILL BE THE EFFECT OF THE DECISION OF THE REGIONAL TRIAL
COURT, BRANCH 10 OF LA TRINIDAD, BENGUET, WHEN IT DECIDED A CASE APPEALED
BEFORE IT UNDER THE PROVISION OF SECTION 8, RULE 40 OF THE RULES OF COURT
OF THE PHILIPPINES, AS TO THE COURSE OF REMEDY THAT MAY BE AVAILED OF BY
THE PETITIONER – A PETITION FOR REVIEWUNDER RULE 42 OR AN ORDINARY APPEAL
UNDER RULE 41.24
Our Ruling
In its October 22, 2003 Order, the RTC declared that the MTC has no jurisdiction over the subject
matter of the case based on the supposition that the same is incapable of pecuniary estimation.
Thus, following Section 8, Rule 40 of the Rules of Court, it took cognizance of the case and
directed the parties to adduce further evidence if they so desire. The parties bowed to this ruling of
the RTC and, eventually, submitted the case for its decision after they had submitted their
respective memoranda.
We cannot, however, gloss over this jurisdictional faux pas of the RTC. Since it involves a
question of jurisdiction, we may motu proprio review and pass upon the same even at this late
stage of the proceedings.25
In her Complaint26 for reconveyance of real property with declaration of nullity of OCT, petitioner
claimed that she and her father had been in open, continuous, notorious and exclusive possession
of the disputed property since the 1940’s. She averred:
7. Sometime in the year 1987, Elizabeth Monzon, the owner of the adjacent parcel of land
being occupied by plaintiff [Maslag], informed the plaintiff that the respective parcels of
land being claimed by them can now be titled. A suggestion was, thereafter made, that
those who were interested to have their lands titled, will contribute to a common fund for
the surveying and subsequent titling of the land;
8. Since plaintiff had, for so long, yearned for a title to the land she occupies, she
contributed to the amount being requested by Elizabeth Monzon;
9. A subdivision survey was made and in the survey, the respective areas of the plaintiff
and the defendants were defined and delimited – all for purposes of titling. x x x
10. But alas, despite the assurance of subdivided titles, when the title was finally issued
by the Registry of Deeds, the same was only in the name of Elizabeth Monzon and
WILLIAM GESTON. The name of Darma Maslag was fraudulently, deliberately and in bad
faith omitted. Thus, the title to the property, to the extent of 18,295 square meters, was
titled solely in the name of ELIZABETH MONZON.
As a relief, petitioner prayed that Monzon be ordered to reconvey the portion of the property which
she claimed was fraudulently included in Monzon’s title. Her primary relief was to recover
ownership of real property. Indubitably, petitioner’s complaint involves title to real property. An
action "involving title to real property," on the other hand, was defined as an action where "the
plaintiff’s cause of action is based on a claim that she owns such property or that she has the legal
rights to have exclusive control, possession, enjoyment, or disposition of the same." 27
Under the present state of the law, in cases involving title to real property, original and exclusive
jurisdiction belongs to either the RTC or the MTC, depending on the assessed value of the subject
property.28 Pertinent provisions of Batas Pambansa Blg. (BP) 129,29 as amended by Republic Act
(RA) No. 7691,30 provides:
Sec. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
jurisdiction:
 (1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
(2) In all civil actions which involve the title to, or possession of, real property, or any
interest therein, where the assessed value of the property involved exceeds Twenty
thousand pesos (₱20,000.00) or for civil actions in Metro Manila, where x x x the
assessed value of the property exceeds Fifty thousand pesos ([P]50,000.00) except
actions for forcible entry into and unlawful detainer of lands or buildings, original
jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts,
and Municipal Circuit Trial Courts;
xxxx
SEC. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit
Trial Courts in Civil Cases. — Metropolitan Trial Courts, Municipal Trial Courts and Municipal
Circuit Trial Courts shall exercise:
xxxx
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where the assessed value of the property or interest therein does
not exceed Twenty thousand pesos (₱20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty thousand pesos (₱50,000.00) x x x.
In the case at bench, annexed to the Complaint is a Declaration of Real Property31 dated
November 12, 1991, which was later marked as petitioner’s Exhibit "A",32 showing that the
disputed property has an assessed value of ₱12,40033 only. Such assessed value of the property
is well within the jurisdiction of the MTC. In fine, the RTC, thru Judge Cabato, erred in applying
Section 19(1) of BP 129 in determining which court has jurisdiction over the case and in
pronouncing that the MTC is divested of original and exclusive jurisdiction.
This brings to fore the next issue of whether the CA was correct in dismissing petitioner’s appeal.
Section 2, Rule 50 of the Rules of Court provides for the dismissal of an improper appeal:
SECTION 2. Dismissal of improper appeal to the Court of Appeals. – An appeal under Rule 41
taken from the Regional Trial Court to the Court of Appeals raising only questions of law shall be
dismissed, issues purely of law not being reviewable by said court. Similarly, an appeal by notice
of appeal instead of by petition for review from the appellate judgment of a Regional Trial Court
shall be dismissed.
An appeal erroneously taken to the Court of Appeals shall not be transferred to the appropriate
court but shall be dismissed outright.1âwphi1 (Emphasis supplied)
There are two modes of appealing an RTC decision or resolution on issues of fact and law.34 The
first mode is an ordinary appeal under Rule 41 in cases where the RTC exercised its original
jurisdiction. It is done by filing a Notice of Appeal with the RTC. The second mode is a petition for
review under Rule 42 in cases where the RTC exercised its appellate jurisdiction over MTC
decisions. It is done by filing a Petition for Review with the CA. Simply put, the distinction between
these two modes of appeal lies in the type of jurisdiction exercised by the RTC in the Order or
Decision being appealed.
As discussed above, the MTC has original and exclusive jurisdiction over the subject matter of the
case; hence, there is no other way the RTC could have taken cognizance of the case and review
the court a quo’s Judgment except in the exercise of its appellate jurisdiction. Besides, the new
RTC Judge who penned the May 4, 2004 Resolution, Judge Diaz de Rivera, actually treated the
case as an appeal despite the October 22, 2003 Order. He started his Resolution by stating, "This
is an appeal from the Judgment rendered by the Municipal Trial Court (MTC) of La Trinidad
Benguet"35 and then proceeded to discuss the merits of the "appeal." In the dispositive portion of
said Resolution, he reversed the MTC’s findings and conclusions and remanded residual issues
for trial with the MTC. Thus, in fact and in law, the RTC Resolution was a continuation of the
proceedings that originated from the MTC. It was a judgment issued by the RTC in the exercise of
its appellate jurisdiction. With regard to the RTC’s earlier October 22, 2003 Order, the same
should be disregarded for it produces no effect (other than to confuse the parties whether the RTC
was invested with original or appellate jurisdiction). It cannot be overemphasized that jurisdiction
over the subject matter is conferred only by law and it is "not within the courts, let alone the
parties, to themselves determine or conveniently set aside."37 Neither would the active
participation of the parties nor estoppel operate to confer original and exclusive jurisdiction where
the court or tribunal only wields appellate jurisdiction over the case. 38 Thus, the CA is correct in
holding that the proper mode of appeal should have been a Petition for Review under Rule 42 of
the Rules of Court, and not an ordinary appeal under Rule 41.
Seeing the futility of arguing against what the RTC actually did, petitioner resorts to arguing for
what the RTC should have done. She maintains that the RTC should have issued its May 4, 2004
Resolution in its original jurisdiction because it had earlier ruled that the MTC had no jurisdiction
over the cause of action.
Petitioner’s argument lacks merit. To reiterate, only statutes can confer jurisdiction. Court
issuances cannot seize or appropriate jurisdiction. It has been repeatedly held that "any judgment,
order or resolution issued without jurisdiction is void and cannot be given any effect." 39 By parity of
reasoning, an order issued by a court declaring that it has original and exclusive jurisdiction over
the subject matter of the case when under the law it has none cannot likewise be given effect. It
amounts to usurpation of jurisdiction which cannot be countenanced. Since BP 129 already
apportioned the jurisdiction of the MTC and the RTC in cases involving title to property, neither the
courts nor the petitioner could alter or disregard the same. Besides, in determining the proper
mode of appeal from an RTC Decision or Resolution, the determinative factor is the type of
jurisdiction actually exercised by the RTC in rendering its Decision or Resolution. Was it rendered
by the RTC in the exercise of its original jurisdiction, or in the exercise of its appellate jurisdiction?
In short, we look at what type of jurisdiction was actually exercised by the RTC. We do not look
into what type of jurisdiction the RTC should have exercised. This is but logical. Inquiring into what
the RTC should have done in disposing of the case is a question which already involves the merits
of the appeal, but we obviously cannot go into that where the mode of appeal was improper to
begin with.
WHEREFORE, premises considered, the Petition for Review is DENIED for lack of merit. The
assailed May 31, 2006 and September 22, 2006 Resolutions of the Court of Appeals in CA-G.R.
CV No. 83365 are AFFIRMED.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 131755 October 25, 1999
MOVERS-BASECO INTEGRATED PORT SERVICES, INC., petitioner,
vs.
CYBORG LEASING CORPORATION, respondent.
VITUG, J.:
The instant matter has been brought to this Court via a petition for review under Rule 45 of the
Rules of Court to seek a reversal of the decision of the decision of the Regional Trial Court
("RTC") of Manila, Branch 16, in Civil Case No. 97-85267.1âwphi1.nêt
Cyborg Leasing Corporation ("Cyborg"), herein private respondent, filed on 22 August 1996 before
the Metropolitan Trial Court ("MTC") of Manila a case, captioned "Damages with Prayer for a Writ
of Replevin" (Civil Case No. 152839), against Conpac Warehousing, Inc. ("Conpac"), and herein
petitioner Movers-Baseco Integrated Port Services ("Movers"). The complaint alleged that
pursuant to a lease agreement, Cyborg had delivered one (1) NISSAN forklift to CONPAC. The
lease agreement stipulated a monthly rental of P11,000.00 for the use of the equipment from its
date of delivery. Conpac supposedly failed and refused to pay the stipulated rentals starting April
1995 notwithstanding demands therefor. Sometime in May 1995, petitioner took control of the
operations of Conpac and seized all cargoes and equipment including the subject forklift.
Petitioner ignored Cyborg's demand for the return to it of the equipment and the formal disclaimer
of ownership made by CONPAC. In its Complaint, Cyborg prayed:
UPON RECEIPT AND BEFORE ANSWER
That an ORDER be issued directing the Sheriff or other officer of this Court to
forthwith take custody and possession of the subject equipment and to dispose it
in accordance with the Rules of Court.
AFTER TRIAL
That judgment be rendered for the plaintiff ordering the defendants, jointly and
severally, to pay the following amounts:
(1) P11,000.00 per month as actual damages
by way of reasonable compensation for the
use, enjoyment and/or rental of the subject
equipment from April 9, 1995 until it is
repossessed by the plaintiff;
(2) P1,000.000.00 as exemplary damages and
(3) P50,000.00 as attorney's fees and costs.
IN THE ALTERNATIVE
In the event that the subject equipment could not be seized, that defendants be
jointly and severally ordered to pay the plaintiff its actual market value of One
Hundred Fifty Thousand Pesos (P150,000.00), Philippine Currency, exclusive of
the damages under paragraphs (1), (2), and (3) stated supra.
Plaintiff further prays for other equitable reliefs and remedies. 1
Upon application of Cyborg, a writ of replevin was issued following the filing of a P300,000.00
replevin bond. The directive was contained in the court's order of 27 August 1996, viz:
WHEREFORE, pursuant to Sections 1 to 3, Rule 60 of the Revised Rules of
Court, a Writ of Replevin is hereby ordered issued requiring the Sheriff of this
Court to fortwith take possession of the property specified on the face of this
Order after serving a copy of this Order to defendants, together with a copy of the
application, affidavit, and bond. Accordingly, the Sheriff of this Court is hereby
required to comply with Sections 4 to 8 of Rule 60.
IT IS SO ORDERED. 2
On 06 February 1997, petitioner was served with a copy of the summons and the writ of replevin.
On 14 February 1997, petitioner filed a motion to dismiss the case on the ground of lack of
jurisdiction on the part of the MTC since the complaint had asked for, among other things, the
following:
(a) . . . actual market value of the
equipment (par. 8 of the complaint) — P150,000.00
(b) . . . actual damages for use of the
equipment at the rate of P11,000.00
monthly from 09 April 1995 up to the
 time possession was taken by the
plaintiff under the order of the Honorable
Court (par, 9(a) of the complaint) 242,000.00
(c) exemplary damages 1,000,000.00
(d) attorney's fees 50,000.00
———————
Total P1,442,000.00
On 18 March 1997, the MTC issued an order dismissing the complaint for lack of jurisdiction, and
ratiocinating, thus —
It is a fundamental axiom in adjective law that jurisdiction is conferred by law, and
where there is none, no agreement of the parties can vest competencia (Leonor
vs. Court of Appeals, 256 SCRA 69; (1996); Department of Health vs. National
Labor Commission, 251 SCRA 700; 707 (1995); 1 Regalado, Remedial Law
Compendium, 1988 5th rev. ed., p. 9).
Albeit the subject equipment has a market value of P150,000.00 (paragraph 8,
Complaint) and while it is true that interest, damages of whatever kind, attorney's
fees, litigation expenses and costs are excluded in ascertaining jurisdiction per
Section 3 of Republic Act No. 7691 and are considered only to determine the
filing fees, it is equally true that if the principal request in the complaint is for
damages, or one of the causes of action, the amount of such claim shall be
determinative of competencia under Supreme Court Circular No. 09-94 dated
June 14, 1994.
The amount sought to be recovered is the "amount of the demand" (Oteng
vs. Tan Kiem, Ta, 61 Phil. 87) and included in the computation of the
jurisdictional amount are attorney's fees recoverable as damages (Article 2208,
New Civil Code), consequential damages, exemplary damages if the amount
thereof is specified in the complaint (Enerio vs. Alampay, 64 SCRA 142, and
moral damages, if quantified in the complaint (Quiason, Philippines Courts and
their Jurisdictions, 1986 ed., pp. 166-168).
Hence, on the basis of the clarification of the Supreme Court, the total claims of
the plaintiff are beyond the purview of this Court's jurisdiction.
Accordingly, Civil Case No. 152839 is hereby DISMISSED for lack of jurisdiction
as prayed for. 3
The MTC, in its order of 10 June 1997, denied Cyborg's motion for reconsideration, elaborating
that it —
. . . is not unaware of Justice Regalado's discourse in his treatise that "replevin is
available only where the principal relief sought in the action is the recovery of
personal property, the other reliefs, like damages, being merely incidental
thereto" (1 Regalado, Remedial Law Compendium, 1988 5th rev. ed., p. 437)
which was utilized by plaintiffs counsel to secure re-evaluation of the challenged
Order (page 2, Additional Arguments Relative to the Motion for Reconsideration).
Yet, this Court cannot also ignore the language of Supreme Court Administrative
Circular No. 09-94 dated June 14, 1994 that if the principal supplication is for
damages, or is one of the causes of action, like in this case, the amount of such
claim will spell the difference in jurisdiction between the Metropolitan Trial Court
and the Regional Trial Court.
WHEREFORE, the plaintiff's Motion for Reconsideration and plaintiffs additional
arguments relative to the motion for reconsideration are hereby DENIED.
Accordingly, as prayed for by defendant's counsel on May 27, 1997, Sheriff
Abulencia is hereby directed to RETURN the Nissan Forklift described as
Equipment No. C-201, 2 Tonner, Engine No. G1-214511 FG 25 TCM to
defendant Movers-Baseco Integrated Port Services, Inc. 4
Cyborg did not succeed in its motion for clarificatory judgment which the court took as just a
second motion for reconsideration. Then, on 26 September 1997, Cyborg filed a petition
for certiorari and prohibition, with preliminary injunction and/or prayer for temporary restraining
order, against the MTC Judge, Conpac Warehousing and Movers, before the RTC of Manila (Civil
Case No. 97-85267). This petition was opposed by Movers as being tardily filed. Still, later, an
answer to this petition was filed by Movers.
On 20 October 1997, the RTC issued an order granting Cyborg's application for preliminary
injunction; the court said:
The MTC dismissed the complaint filed by petitioner Cyborg for replevin of a
leased Nissan forklift by defendant Compac and later taken into custody by
defendant Movers-Baseco. Upon the MTC's denial of Cyborg's motion for
reconsideration, Cyborg caused the filing of the instant petition.
In its motion to dismiss before the MTC Manila, Movers-Baseco argued that the
MTC had no jurisdiction over this case because while the alleged amount of the
forklift is P150,000, together with the other amounts/damages claimed, the total
is beyond the MTC's jurisdiction.
Cyborg argued that since the principal action is for replevin, the other amounts
being merely incidental, as the amount of P150,000 is within the MTC
jurisdiction, the latter is competent to take cognizance of the case.
 Such arguments, however, are better reserved for the adjudication on the merits
of this petition. The issue now is whether there is sufficient legal ground to issue
a writ of preliminary injunction to enjoin enforcement of the MTC's order dated
June 10, 1997 which directed the delivery of the replevied forklift back to Movers-
Baseco.
The MTC complaint alleged that the rentals of P11,000 per month are not being
paid in the interim which lease contract is dated January 5, 1995 (Record, page
35).
It appears that Cyborg is the lessor-owner of the forklift. In the meantime, the
rentals are not being paid it. As owner of the same, Cyborg has a clear right to
the possession of the same during the pendency of this proceedings, the MTC
having already issued a writ of replevin to gain possession of the forklift which is
now in the possession of Cyborg. This status quo existing at the time this petition
was filed should be maintained pending the resolution of the case, otherwise,
great damage will be caused to Cyborg, the owner.
The 1997 Rules on Civil Procedure allow the ex parte issuance of a 20-day TRO,
the Rules silent as to whether a bond should cover the 20-day TRO, as it is the
writ of preliminary injunction that requires the filing of an injunction bond. Hence,
this Court issued a TRO until October 22, 1997 (Rule 58, Section 5), otherwise,
with the rentals in the interim being unpaid, Cyborg is destined to suffer GREAT
damage (not necessarily irreparable), the Rule expressly mentioning great OR
irreparable injury.1âwphi1.nêt
WHEREFORE, PREMISES CONSIDERED, let a writ of preliminary injunction
issue against the respondents. The public and private respondents, the sheriff
concerned, and any person acting for and in their behalf are restrained from
implementing the order of the MTC Manila dated June 10, 1997 directing the
delivery of the forklift back to the private respondent Movers-Baseco until the
Court resolves the petition with finality.
Serve a copy of this order, together with a copy of the affidavit, upon the public
and private respondents. No additional injunction bond is being required because
Cyborg already filed an injunction bond before the MTC Manila. 5
Feeling aggrieved, petitioner filed before the RTC on 24 October 1997 this manifestation:
For accuracy, respondent Movers-Baseco would like to state that:
(a) respondent Movers-Baseco never took custody of the forklift after the
respondent Sheriff took possession of the same pursuant to the writ of replevin
issued by the MTC; and
(b) moreover, there is no bond posted by the petitioner for the issuance of the
injunction. The bond referred to by this Court is the replevin bond posted in the
Metropolitan Trial Court. 6
Ultimately, on 04 December 1997, the RTC promulgated its judgment in Civil Case No. 97-85267;
resolving the merits of the petition, it concluded:
WHEREFORE, PREMISES CONSIDERED, the petition for certiorari is hereby
GRANTED. Consequently,
1. Having been rendered with grave abuse of discretion, the
orders of respondent judge dated March 18, (Annex A), June
10, 1997 (Annex B), and August 22, 1997 (Annex C) are hereby
ANNULLED and SET ASIDE.
2. Respondent judge is ordered to refrain from implementing his
order dated June 10, 1997 for the delivery of the forklift to
respondent MOVERS-BASECO, making the writ of injunction
permanent.
3. Remanding the case to the MTC Manila for trial on the merits.
Let a certified copy of this judgment be served upon the public respondent MTC
Manila judge. Serve likewise a copy of this judgment upon the respondent
Sheriff, counsel for petitioner, counsel for CONPAC, and counsel for MOVERS-
BASECO. 7
Petitioner timely resorted to this Court, via the instant petition for review, assailing the decision of
the RTC and submitting to the Court the following legal issues: Whether or not —
(1) the MTC had jurisdiction over respondent's complaint;
(2) the MTC's order of dismissal had become final and executory;
(3) Cyborg's special civil action of certiorari and prohibition before the RTC can be a substitute for
a lost appeal; and
(4) a temporary restraining order or preliminary writ of injunction can be issued without an
injunction bond apart from the replevin bond.
The threshold issue concerns MTC's jurisdiction over the action filed by Cyborg in Civil Case No.
152839 for "Damages with prayer for a writ of replevin." Hardly disputable is that the jurisdiction of
the court and the nature of the action must be determined by the averments in the complaint and
the character of the relief sought8 vis-a-vis the corresponding provisions of the law involved. 9
Sec. 33 of Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, states:
Sec. 33. Jurisdiction of Metropolitan Trial Courts; Municipal Trial Courts and
Municipal Circuit Trial Courts in Civil Cases. — Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:
(1) Exclusive original jurisdiction over civil actions and probate proceedings
testate and intestate, including the grant of provisional remedies in proper cases,
where the value of the personal property, estate, or amount of the demand does
not exceed, or amount of the demand does not exceed One hundred thousand
pesos (P100,000.00) or, in Metro Manila where such personal property, estate,
or amount of the demand does not exceed Two hundred thousand pesos
(P200,000.00), exclusive of interest, damages of whatever kind, attorney's fees,
litigation expenses, and costs, the amount of which must be specifically
alleged: Provided, That interest, damages of whatever kind, attorney's fees,
litigation expenses, and costs shall be included in the determination of the filing
fees: Provided, further, That where there are several claims or causes of actions
between the same or different parties, embodied in the same complaint, the
amount of the demand shall be the totality of the claims in all the causes of
action, irrespective of whether the causes of action arose out of the same or
different transactions;
Supreme Court Administrative Circular No. 09-94, in turn, provides:
SUBJECT: Guidelines in the Implementation of the Republic Act No. 7691,
Entitled "An Act Expanding the Jurisdiction of the Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit Trial Courts, Amending For the
Purpose Batas Pambansa Blg. 129, otherwise Known As the Judiciary
Reorganization Act of 1980."
the actual damages in the form of unpaid rentals were just incident of the action for the return of
the forklift, considering that private respondent specifically sought in the complaint not only the
seizure of the forklift from petitioner-Movers, which took control of the operations of Conpac, but
likewise the payment of unpaid and outstanding rentals. Verily, the Metropolitan Trial Court's
orders of 18 March 1997 and 10 June 1997 dismissing the complaint and denying the motion of
private respondent, respectively, were properly decreed.
Another set back for Cyborg's cause was the fact that its petition for certiorari, with preliminary
injunction and prayer for temporary restraining order, filed before the RTC should not have been
allowed not only for being late but also for not being a valid substitute for a lost appeal. A petition
for certiorari under the 1997 Rules of Civil Procedure should be filed within 60 days from receipt of
the assailed decision, order or resolution. Cyborg's petition with the RTC was filed fourteen (14)
days late 10 on 26 September 1997, or on the 74th day from its receipt of the order denying the
motion for reconsideration on 14 July 1997. The RTC acted on the mistaken notion that the 1997
Rules of Civil Procedure took effect only in October 1997; in fact, the new rules became operative
since 01 July 1997.
Having thus concluded, the Court need not take up the other issues raised.
WHEREFORE, the petition for review is GRANTED, and the decision of the Regional Trial Court
of Manila in Civil Case No. 97-85267 is ANNULLED and SET ASIDE. The orders dated 18 March
1997, 10 June 1997 and 22 August 1997 of the Metropolitan Trial Court of Manila in Civil Case
No. 152839 for "Damages With Prayer for a Writ of Replevin" are reinstated. Civil Case No.
152839 for damages is ordered DISMISSED for lack of jurisdiction.1âwphi1.nêt
SO ORDERED.

xxx xxx xxx

2. the exclusion of the term "damages" of whatever kind in determining the

jurisdictional amount under Section 19(8) and Section 33(1) of B.P. Blg. 129, as
amended by R.A. No. 7691, applies to cases where the damages are merely
incidental to or a consequence of the main cause of action. However, in cases
where the claim for damages is the main cause of action, or one of the causes of
action, the amount of such claim shall be considered in determining the
jurisdiction of the court.

The complaint filed by Cyborg with the Metropolitan Trial Court of Manila prayed for the return of
the Nissan Forklift to it, as owner and as lessor pursuant to a lease agreement executed by it in
favor of Conpac, or, in the alternative for the payment of P150,000.00 (the actual market value of
the forklift), plus damages, plus the amount of unpaid lease, starting 09 April 1995 at P11,000.00
per month, which as of the time of the filing of the complaint on 22 August 1996 had amounted to
P180,000.00 which, together with the value of the forklift, reach the sum of P230,000.00 excluding
the amount of damages and attorney's fees likewise claimed. It would be incorrect to argue that
 Republic of the Philippines
SUPREME COURT
SECOND DIVISION
G.R. No. 143951 October 25, 2005
Norma Mangaliag and Narciso Solano, Petitioners,
vs.
Hon. Edelwina Catubig-Pastoral, Judge of the Regional Trial Court, 1st Judicial Region, San
Carlos City, (Pangasinan), Branch 56 and Apolinario Serquina, Jr., Respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a petition for certiorari, with a prayer for the issuance of a temporary restraining order,
to set aside the Order dated April 17, 2000 of the Regional Trial Court (RTC), Branch 56, San
Carlos City in Civil Case No. SCC-2240, which denied petitioners’ motion to dismiss; and the
Order dated June 13, 2000, which denied petitioners’ motion for reconsideration.
The factual background of the case is as follows:
On May 10, 1999, private respondent Apolinario Serquina, Jr. filed before the RTC a complaint for
damages against petitioners Norma Mangaliag and Narciso Solano. The complaint alleges that:
on January 21, 1999, from 9:00 to 10:00 a.m., private respondent, together with Marco de Leon,
Abner Mandapat and Manuel de Guzman, was on board a tricycle driven by Jayson Laforte; while
in Pagal, San Carlos City, a dump truck owned by petitioner Mangaliag and driven by her
employee, petitioner Solano, coming from the opposite direction, tried to overtake and bypass a
tricycle in front of it and thereby encroached the left lane and sideswiped the tricycle ridden by
private respondent; due to the gross negligence, carelessness and imprudence of petitioner
Solano in driving the truck, private respondent and his co-passengers sustained serious injuries
and permanent deformities; petitioner Mangaliag failed to exercise due diligence required by law in
the selection and supervision of her employee; private respondent was hospitalized and spent
₱71,392.00 as medical expenses; private respondent sustained a permanent facial deformity due
to a fractured nose and suffers from severe depression as a result thereof, for which he should be
compensated in the amount of ₱500,000.00 by way of moral damages; as a further result of his
hospitalization, private respondent lost income of ₱25,000.00; private respondent engaged the
services of counsel on a contingent basis equal to 25% of the total award.1
On July 21, 1999, petitioners filed their answer with counterclaim denying that private respondent
has a cause of action against them. They attributed fault or negligence in the vehicular accident on
the tricycle driver, Jayson Laforte, who was allegedly driving without license. 2
Following pre-trial conference, trial on the merits ensued. When private respondent rested his
case, petitioner Solano testified in his defense.
Subsequently, on March 8, 2000, petitioners, assisted by a new counsel, filed a motion to dismiss
on the ground of lack of jurisdiction over the subject matter of the claim, alleging that the Municipal
Trial Court (MTC) has jurisdiction over the case since the principal amount prayed for, in the
amount of ₱71,392.00, falls within its jurisdiction.3 Private respondent opposed petitioners’ motion
to dismiss.4 On March 24, 2000, petitioners filed a supplement in support of their motion to
dismiss.5
On April 17, 2000, the respondent RTC Judge, Edelwina Catubig-Pastoral, issued the first
assailed Order denying petitioners’ motion to dismiss,6 relying upon the mandate of Administrative
Circular No. 09-94, paragraph 2 of which reads:
2. The exclusion of the term "damages of whatever kind in determining the jurisdictional amount
under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applied
to cases where the damages are merely incidental to or a consequence of the main cause of
action. However, in cases where the claim for damages is the main cause of action, or one of the
causes of action, the amount of such claim shall be considered in determining the jurisdiction of
the court.
The respondent RTC Judge also cited the 1999 case of Ong vs. Court of Appeals,7 where an
action for damages due to a vehicular accident, with prayer for actual damages of ₱10,000.00 and
moral damages of ₱1,000,000.00, was tried in a RTC.
On May 19, 2000, petitioners filed a motion for reconsideration 8 but it was denied by the
respondent RTC Judge in her second assailed Order, dated June 13, 2000.9
Hence, the present petition for certiorari, with prayer for the issuance of a temporary restraining
order.10
On August 9, 2000, the Court resolved to issue the temporary restraining order prayed for by
petitioners. Consequently, the respondent RTC Judge desisted from hearing further Civil Case No.
SCC-2240.11
Petitioners propound this issue for consideration: In an action for recovery of damages, does the
amount of actual damages prayed for in the complaint provide the sole test for determining the
court’s jurisdiction, or is the total amount of all the damages claimed, regardless of kind and
nature, such as moral, exemplary, nominal damages, and attorney’s fees, etc., to be computed
collectively with the actual damages to determine what court – whether the MTC or the RTC – has
jurisdiction over the action?
Petitioners maintain that the court’s jurisdiction should be based exclusively on the amount of
actual damages, excluding therefrom the amounts claimed as moral, exemplary, nominal
damages and attorney’s fee, etc. They submit that the specification in Administrative Circular No.
09-94 that "in cases where the claim for damages is the main cause of action. . . the amount of
such claim shall be considered in determining the jurisdiction of the court"signifies that the court’s
jurisdiction must be tested solely by the amount of that damage which is principally and primarily
demanded, and not the totality of all the damages sought to be recovered.
Petitioners insist that private respondent’s claim for actual damages in the amount of ₱71,392.00
is the principal and primary demand, the same being the direct result of the alleged negligence of
petitioners, while the moral damages for ₱500,000.00 and attorney’s fee, being the consequent
effects thereof, may prosper only upon a prior finding by the court of the existence of petitioners’
negligence that caused the actual damages. Considering that the amount of actual damages
claimed by private respondent in Civil Case No. SCC-2240 does not exceed ₱200,000.00, which
was then the jurisdictional amount of the MTC, the jurisdiction over the case clearly pertains to the
MTC, and not to the RTC. Therefore, the RTC should have dismissed the case for lack of
jurisdiction. Petitioners cite as relevant the case of Movers-Baseco Integrated Port Services, Inc.
vs. Cyborg Leasing Corporation12 wherein the Court, in disposing of the jurisdictional issue, limited
its consideration only to the actual or compensatory damages.
Furthermore, while admitting that the defense of lack of jurisdiction was only raised during the trial,
petitioners nevertheless contend that jurisdiction may be raised anytime, even after judgment, but
before it is barred by laches or estoppel. They submit that they seasonably presented the
objection to the RTC’s lack of jurisdiction, i.e., during the trial stage where no decision had as yet
been rendered, must less one unfavorable to them.
At any rate, they argue that when the jurisdictional flaw is evident from the record of the case, the
court may, even without the urgings of the parties, take judicial notice of such fact, and thereupon
dismiss the case motu proprio. Thus, even if lack of jurisdiction was not initially raised in a motion
to dismiss or in the answer, no waiver may be imputed to them.
Private respondent, on the other hand, submits that in an action for recovery of damages arising
from a tortious act, the claim of moral damages is not merely an incidental or consequential claim
but must be considered in the amount of demand which will determine the court’s jurisdiction. He
argues that the position taken by petitioners is a misreading of paragraph 2 of Administrative
Circular No. 09-94. The clear and explicit language of said circular leaves no room for doubt;
hence, needs no interpretation.
He further submits that petitioners’ reliance on Movers-Baseco Integrated Port Services, Inc. is
misplaced since that case is for recovery of the value of vehicle and unpaid rentals on the lease of
the same. He contends that Section 18, paragraph 8 of Batas Pambansa Blg. 129, as amended by
Republic Act No. 7691, upon which petitioners anchor their stand, refers to all the demands
involving collection of sums of money based on obligations arising from contract, express or
implied, where the claim for damages is just incidental thereto and it does not apply to actions for
damages based on obligations arising from quasi-delict where the claim for damages of whatever
kind is the main action.
Private respondent also contends that, being incapable of pecuniary computation, the amount of
moral damages that he may be awarded depends on the sound discretion of the trial court, not
restrained by the limitation of the jurisdictional amount. Should the Court follow petitioners’ line of
reasoning, private respondent argues that it will result in an absurd situation where he can only be
awarded moral damages of not more than ₱200,000.00 although he deserves more than this
amount, taking into consideration his physical suffering, as well as social and financial standing,
simply because his claim for actual damages does not exceed ₱200,000.00 which amount falls
under the jurisdiction of the MTC.
Lastly, he asserts that it is too late in the day for petitioners to question the jurisdiction of the RTC
since they are estopped from invoking this ground. He contends that after actively taking part in
the trial proceedings and presenting a witness to seek exoneration, it would be unfair and legally
improper for petitioners to seek the dismissal of the case.
At the outset, it is necessary to stress that generally a direct recourse to this Court is highly
improper, for it violates the established policy of strict observance of the judicial hierarchy of
courts. Although this Court, the RTCs and the Court of Appeals (CA) have concurrent jurisdiction
to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction,
such concurrence does not give the petitioner unrestricted freedom of choice of court forum. This
Court is a court of last resort, and must so remain if it is to satisfactorily perform the functions
assigned to it by the Constitution and immemorial tradition.13
Thus, this Court, as a rule, will not entertain direct resort to it unless the redress desired cannot be
obtained in the appropriate courts, and exceptional and compelling circumstances, such as cases
of national interest and of serious implications, justify the availment of the extraordinary remedy of
writ of certiorari, calling for the exercise of its primary jurisdiction.14 Such exceptional and
compelling circumstances were present in the following cases: (a) Chavez vs. Romulo15 on the
citizens’ right to bear arms; (b) Government of the United States of America vs. Purganan16 on bail
in extradition proceedings; (c) Commission on Elections vs. Quijano-Padilla17 on a government
contract on the modernization and computerization of the voters’ registration list; (d) Buklod ng
Kawaning EIIB vs. Zamora[18] on the status and existence of a public office; and (e) Fortich vs.
Corona19 on the so-called "Win-Win Resolution" of the Office of the President which modified the
approval of the conversion to agro-industrial area of a 144-hectare land.
Be that as it may, the judicial hierarchy of courts is not an iron-clad rule. It generally applies to
cases involving warring factual allegations. For this reason, litigants are required to repair to the
trial courts at the first instance to determine the truth or falsity of these contending allegations on
the basis of the evidence of the parties. Cases which depend on disputed facts for decision cannot
be brought immediately before appellate courts as they are not triers of facts. 20 Therefore, a strict
application of the rule of hierarchy of courts is not necessary when the cases brought before the
appellate courts do not involve factual but legal questions.
In the present case, petitioners submit a pure question of law involving the interpretation and
application of paragraph 2 of Administrative Circular No. 09-94. This legal question and in order to
avoid further delay are compelling enough reasons to allow petitioners’ invocation of this Court’s
jurisdiction in the first instance.
Before resolving this issue, the Court shall deal first on the question of estoppel posed by private
respondent. Private respondent argues that the defense of lack of jurisdiction may be waived by
estoppel through active participation in the trial. Such, however, is not the general rule but an
exception, best characterized by the peculiar circumstances in Tijam vs.
Sibonghanoy.21 In Sibonghanoy, the party invoking lack of jurisdiction did so only after fifteen
years and at a stage when the proceedings had already been elevated to the CA. Sibonghanoy is
an exceptional case because of the presence of laches, which was defined therein as failure or
neglect for an unreasonable and unexplained length of time to do that which, by exercising due
diligence, could or should have been done earlier; it is the negligence or omission to assert a right
within a reasonable time, warranting a presumption that the party entitled to assert has abandoned
it or declined to assert it.22
As enunciated in Calimlim vs. Ramirez,23 this Court held:
A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to
cite is that the jurisdiction of a court over the subject matter of the action is a matter of law and
may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court
may be raised at any stage of the proceedings, even on appeal. This doctrine has been qualified
by recent pronouncements which stemmed principally from the ruling in the cited case
of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to
situations which were obviously not contemplated therein. The exceptional circumstances involved
in Sibonghanoy which justified the departure from the accepted concept of non-waivability of
objection to jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly
upheld that rendered the supposed ruling in Sibonghanoy not as the exception, but rather the
general rule, virtually overthrowing altogether the time honored principle that the issue of
jurisdiction is not lost by waiver or by estoppel.
...
It is neither fair nor legal to bind a party by the result of a suit or proceeding which was taken
cognizance of in a court which lacks jurisdiction over the same irrespective of the attendant
circumstances. The equitable defense of estoppel requires knowledge or consciousness of the
facts upon which it is based. The same thing is true with estoppel by conduct which may be
asserted only when it is shown, among others, that the representation must have been made with
knowledge of the facts and that the party to whom it was made is ignorant of the truth of the matter
(De Castro vs. Gineta, 27 SCRA 623). The filing of an action or suit in a court that does not
possess jurisdiction to entertain the same may not be presumed to be deliberate and intended to
secure a ruling which could later be annulled if not favorable to the party who filed such suit or
proceeding. Instituting such an action is not a one-sided affair. It can just as well be prejudicial to
the one who file the action or suit in the event that he obtains a favorable judgment therein which
could also be attacked for having been rendered without jurisdiction. The determination of the
correct jurisdiction of a court is not a simple matter. It can raise highly debatable issues of such
importance that the highest tribunal of the land is given the exclusive appellate jurisdiction to
entertain the same. The point simply is that when a party commits error in filing his suit or
proceeding in a court that lacks jurisdiction to take cognizance of the same, such act may not at
once be deemed sufficient basis of estoppel. It could have been the result of an honest mistake or
of divergent interpretations of doubtful legal provisions. If any fault is to be imputed to a party
taking such course of action, part of the blame should be placed on the court which shall entertain
the suit, thereby lulling the parties into believing that they pursued their remedies in the correct
forum. Under the rules, it is the duty of the court to dismiss an action "whenever it appears that
court has no jurisdiction over the subject matter." (Section 2, Rule 9, Rules of Court) Should the
Court render a judgment without jurisdiction, such judgment may be impeached or annulled for
lack of jurisdiction (Sec. 30, Rule 132, Ibid), within ten (10) years from the finality of the same (Art.
1144, par. 3, Civil Code).24
In the present case, no judgment has yet been rendered by the RTC.25 As a matter of fact, as
soon as the petitioners discovered the alleged jurisdictional defect, they did not fail or neglect to
file the appropriate motion to dismiss. Hence, finding the pivotal element of laches to be absent,
the Sibonghanoy doctrine does not control the present controversy. Instead, the general rule that
the question of jurisdiction of a court may be raised at any stage of the proceedings must apply.
Therefore, petitioners are not estopped from questioning the jurisdiction of the RTC.
In any event, the petition for certiorari is bereft of merit.
Section 1 of Republic Act (R.A.) No. 7691, which took effect on April 15, 1994, provides inter
alia that where the amount of the demand in civil cases exceeds ₱100,000.00, 26 exclusive of
interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs, the exclusive
jurisdiction thereof is lodged with in the RTC. Under Section 3 of the same law, where the amount
of the demand in the complaint does not exceed ₱100,000.00, exclusive of interest, damages of
whatever kind, attorney’s fees, litigation expenses, and costs, the exclusive jurisdiction over the
same is vested in the Metropolitan Trial Court, MTC and Municipal Circuit Trial Court. The
jurisdictional amount was increased to ₱200,000.00,27 effective March 20, 1999, pursuant to
Section 528 of R.A. No. 7691 and Administrative Circular No. 21-99.
In Administrative Circular No. 09-94 dated March 14, 1994, the Court specified the guidelines in
the implementation of R.A. No. 7691. Paragraph 2 of the Circular provides:
2. The exclusion of the term "damages of whatever kind in determining the jurisdictional amount
under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applied
to cases where the damages are merely incidental to or a consequence of the main cause of
action. However, in cases where the claim for damages is the main cause of action, or one of
the causes of action, the amount of such claim shall be considered in determining the
jurisdiction of the court. (Emphasis supplied)
The well-entrenched principle is that the jurisdiction of the court over the subject matter of the
action is determined by the material allegations of the complaint and the law, irrespective of
whether or not the plaintiff is entitled to recover all or some of the claims or reliefs sought
therein.29 In the present case, the allegations in the complaint plainly show that private respondent
seeks to recover not only his medical expenses, lost income but also damages for physical
suffering and mental anguish due to permanent facial deformity from injuries sustained in the
vehicular accident. Viewed as an action for quasi-delict, the present case falls squarely within the
purview of Article 2219 (2),30 which provides for the payment of moral damages in cases of quasi-
delict causing physical injuries.
Private respondent’s claim for moral damages of ₱500,000.00 cannot be considered as merely
incidental to or a consequence of the claim for actual damages. It is a separate and distinct cause
of action or an independent actionable tort. It springs from the right of a person to the physical
integrity of his or her body, and if that integrity is violated, damages are due and
assessable.31 Hence, the demand for moral damages must be considered as a separate cause of
action, independent of the claim for actual damages and must be included in determining the
jurisdictional amount, in clear consonance with paragraph 2 of Administrative Circular No. 09-94.
If the rule were otherwise, i.e., the court’s jurisdiction in a case of quasi-delict causing physical
injuries would only be based on the claim for actual damages and the complaint is filed in the
MTC, it can only award moral damages in an amount within its jurisdictional limitations, a situation
not intended by the framers of the law.

It must be remembered that moral damages, though incapable of pecuniary estimation, are
designed to compensate and alleviate in some way the physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and
similar injury unjustly caused a person.32 Moral damages are awarded to enable the injured party
to obtain means, diversions or amusements that will serve to alleviate the moral suffering he/she
has undergone, by reason of the defendant’s culpable action. Its award is aimed at restoration, as
much as possible, of the spiritual status quo ante; thus, it must be proportionate to the suffering
inflicted. Since each case must be governed by its own peculiar circumstances, there is no hard
and fast rule in determining the proper amount.33

The petitioners’ reliance in the case of Movers-Baseco Integrated Port Services, Inc. vs. Cyborg
Leasing Corporation34 is misplaced. The claim for damages therein was based on a breach of a
contract of lease, not a quasi-delict causing physical injuries, as in this case. Besides, there was
no claim therein for moral damages. Furthermore, moral damages are generally not recoverable in
damage actions predicated on a breach of contract in view of the provisions of Article 2220 35 of the
Civil Code.

In view of the foregoing, the Court is convinced that the respondent RTC Judge committed no
grave abuse of discretion in issuing the assailed Orders dated April 17, 2000 and June 13, 2000.

WHEREFORE, the instant petition for certiorari is DISMISSED for lack of merit. The temporary
restraining order issued by this Court on August 9, 2000 is LIFTED.

The Regional Trial Court, Branch 56, San Carlos City is DIRECTED to continue with the trial
proceedings in Civil Case No. SCC-2240 and resolve the case with dispatch.

Costs against petitioners.

SO ORDERED.
 SECOND DIVISION
G.R. No. 138542 August 25, 2000
ALFREDO P. PASCUAL and LORETA S. PASCUAL, petitioners,
vs.
COURT OF APPEALS (former Seventh Division), ERNESTO P. PASCUAL and HON.
ADORACION ANGELES, in her capacity as Presiding Judge, RTC, Kaloocan City, Branch
121, respondents.
DECISION
MENDOZA, J.:
The question for decision in this case is whether an action for reconveyance of a piece of land and
for accounting and damages which private respondent Ernesto P. Pascual brought against his
brother, petitioner Alfredo P. Pascual, and the latter’s wife involves an intra-corporate dispute
beyond the jurisdiction of the Regional Trial Court, Branch 121, Kalookan City in which it was filed.
The trial court held that the action did not constitute an intra-corporate dispute and, therefore,
denied petitioners’ motion to dismiss. The Court of Appeals sustained the order of the trial court.
Hence, this petition for review of the decision1 of the appellate court. We affirm.
The facts are as follows:
On February 7, 1996, private respondent Ernesto P. Pascual filed a complaint in the Regional Trial
Court for "accounting, reconveyance of real property based on implied trust resulting from fraud,
declaration of nullity of TCT, recovery of sums of money, and damages" against his brother,
petitioner Alfredo, and the latter’s wife Loreta Pascual. The pertinent parts of his complaint read:
3. Plaintiff Ernesto and defendant Alfredo Pascual are full blood brothers. They, along
with Araceli P. Castro, Ester P. Abad, Edgardo P. Pascual, Sr. (now deceased), Corazon
P. Montenegro, Leonor P. Rivera, Luciano Pascual, Jr., and Teresita P. Manuel, are
legitimate children of Luciano Pascual, Sr. and Consolacion Pascual. Defendant Loreta
Pascual is the wife of defendant Alfredo.
4. Between 1963 to 1975, Luciano R. Pascual, Sr. acquired substantial shares in Phillens
Manufacturing Corp. Luciano, Sr. parceled out and assigned a good number of these
shares in the names of his children.
5. With Luciano’s substantial shareholdings, his eldest son, defendant Alfredo became
President, General Manager, and Vice-Chairman of the Board of Phillens. Plaintiff was
only 20 years old then.
6. Defendant Alfredo was also president of L.R. Pascual & Sons, Inc. which held
substantial shares in Phillens. (Plaintiff is a stockholder of L. R. Pascual & Sons, Inc.)
7. Although during and after the lifetime of the parties’ parents, defendant Alfredo held
family property in trust for Luciano Sr. and Consolacion, and for his brothers and sisters,
defendant Alfredo gave the latter no accounting at any point in time contrary to what their
father intended.
8. Because from 1969 to 1990, defendant Alfredo turned over zero profit to plaintiff
Ernesto as far as his share was concerned, plaintiff tried to arrange a meeting between
them about the matter of accounting -- without any success during a 5-year period (1990-
1995). Defendant Alfredo would each time be sensitive, evasive, and drunk, so nothing
became of those efforts.
....
10. Since defendant Alfredo was President of L.R. Pascual & Sons, Inc. which held family
properties in Quezon City, Manila, and Baguio, plaintiff wanted this matter taken up in a
meeting he requested with defendant Alfredo. In addition, plaintiff asked defendant
Alfredo for an accounting in L.R. Pascual & Co., a registered partnership distinct from
L.R. Pascual & Sons, Inc. which would be discussed in that requested meeting.
....
12. Because of defendant Alfredo’s icy silence and unmistakable attempts to claim the lid
on plaintiff Ernesto Pascual, plaintiff conducted an inquiry. As a result, he discovered that
when defendant Alfredo caused the dissolution of Phillens Manufacturing Corporation by
asking for a shortening of its term, defendant Alfredo represented in an affidavit of
undertaking that
(a) he is the owner of the majority of the outstanding capital stock of the
corporation;
(b) that the corporation has no obligation, whether existing or contingent, direct or
indirect, due or payable to any person whomsoever, natural or juridical;
(c) he is assuming and will pay any and all valid claims or demands by creditors,
stockholders, or any third person or persons, presented after the dissolution of
the corporation.
13. By taking a position adverse to the trust and to his family’s, defendant Alfredo, greatly
profiting from Phillens, now held he owned majority and will undertake to pay any
claimant or creditor. Yet, defendant Alfredo had not paid plaintiff what was properly owing
to him.
14. Plaintiff also discovered, to his dismay, that defendant Alfredo had written an October
8, 1990 letter to the Securities & Exchange Commission falsely representing as follows:
October 8, 1990
 Examiner & Appraiser Dept. [sic]
Securities & Exchange Commission
E. de los Santos Avenue
Mandaluyong, Metro Manila
Gentlemen:
This will certify that the ₱3.3-million notes payable as shown in the balance sheet of
Phillens Manufacturing Corporation as of June 30, 1990, is [sic] my personal advances.
Since I am assuming the assets and liabilities of the company, to which all the
stockholders have consented, I am likewise giving my consent to the dissolution of the
corporation.
Very truly yours,
ALFREDO P. PASCUAL
16. Further, on inquiry, plaintiff discovered that last April 3, 1989, defendant Alfredo
caused an appraisal of the fair market value of the land and buildings of Phillens in
Kalookan, excluding equipment, remaining stock and inventory. Aware that Cuervo had
appraised such properties at ₱10,977,000 as of March 10, 1989, defendant Alfredo
hatched a ploy to buy for himself such properties at only ₱4.5 million. (A copy of the April
3, 1989 Cuervo report addressed to defendant Alfredo is here attached as Annex A.)
18. To consummate his fraudulent design, defendant Alfredo caused in bad faith the
cancellation of TCT C-28572 and the issuance of TCT 215804 in his and defendant
Loreta’s name (copy of which is here attached as Annex D). That TCT is of course void,
proceeding as it does from a void transfer, which constitutes fraud and a breach of trust.
On March 21, 1996, petitioners filed a motion to dismiss on the ground that the complaint raises
an intra-corporate controversy between the parties over which original and exclusive jurisdiction is
vested in the Securities and Exchange Commission (SEC). At first, the trial court granted
petitioners’ motion and dismissed the complaint on the ground that the complaint stemmed from
alleged fraudulent acts and misrepresentations of petitioner Alfredo P. Pascual as a corporate
officer of Phillens Manufacturing Corp. (Phillens) and thus the SEC had jurisdiction over the case.
However, on respondent’s motion, the trial court reconsidered its order and reinstated
respondent’s action. In an order, dated September 29, 1997, the trial court held that, since the
corporation had been dissolved in 1990 and its corporate affairs terminated in 1993, there were no
more corporate affairs to speak of at the time of the filing of the complaint. The court also allowed
the amendment of the complaint. It appears that, pending resolution of the motion for
reconsideration, respondent amended his complaint by alleging the following matters which are
underlined:
4. Luciano R. Pascual, Sr. together with L.R. Pascual & Sons. Inc. acquired
approximately 38% of shares in Phillens Manufacturing Corp., a close
corporation. Luciano Sr. died in 1984 while Consolacion died in 1986. Thus, plaintiff
became owner by operation of law of 1/9 of his parents’ stockholdings since they died
intestate without obligations.
5. With Luciano’s substantial shareholdings, defendant Alfredo became President,
General Manager, and Vice-Chairman of Phillens in 1968 or 1969, positions which he
held until 1990 when Phillens was dissolved.
6. Defendant Alfredo held in trust for the benefit of Luciano Sr. and Consolacion, and for
his brothers and sisters, plaintiff included, said stockholdings and the properties of
Phillens.
7. As trustee defendant Alfredo did not turn over the properties and sums due to plaintiff
and the former even failed to account for the trust estate and its earnings, to the grave
prejudice of the latter.
8. One of the properties composing the trust estate, TCT No. C-28572 with an area of
7,528 square meters located in Caloocan City, was registered in the name of defendants
under devious and fraudulent circumstances engineered by Alfredo.
8.1. Said property was appraised conservatively to have a market value of no
less than P10.9 Million in 1989.
8.2 Although Alfredo was fully aware of its market value, Alfredo schemed,
manipulated and succeeded in transferring title to and possession in his favor of
TCT No. C-28572 in 1989 for an alleged consideration of P4.5 Million, in violation
of his duties as trustee.
8.3 In order to cover-up such serious breach of trust, Alfredo maliciously caused
the dissolution of Phillens in 1990, shortly after ownership was transferred to him,
and further caused the destruction of Phillens records thereby rendering its
stocks valueless after its corporate affairs were wound up in 1993.
8.4 Defendants presently appear as legal and beneficial owners by virtue of TCT
No. C-215804.
Petitioners reiterate their contention that the complaint against them involves an intra-corporate
dispute cognizable by the SEC and, therefore, the Regional Trial Court should have dismissed the
complaint. They complain that the trial court should not have allowed the amendment of the
complaint because it was done in order to confer jurisdiction on the trial court.
First. Petitioners contend that the existence of a corporation at the time of filing of a complaint
involving an intra-corporate dispute is not required in order that such dispute be cognizable by the
SEC because such requirement is not found in P.D. No. 902-A.
This contention has no merit. P.D. 902-A, §5 provides:
In addition to the regulatory and adjudicative functions of the Securities and Exchange
Commission over corporations, partnerships and other forms of association registered with it as
expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction
to hear and decide cases involving:
....
b) Controversies arising out of intra-corporate or partnership relations, between and among
stockholders, members, or associates; between any or all of them and the corporation, partnership
or association of which they are stockholders, members or associates, respectively; and between
such corporation, partnership or association and the state insofar as it concerns their individual
franchise or right to exist as such entity;
....
Sec. 5(b) does not define what an intra-corporate controversy is, but case law has fashioned out
two tests for determining what suit is cognizable by the SEC or the regular courts, and sometimes
by the National Labor Relations Commission. The first test uses the enumeration in §5(b) of the
relationships to determine jurisdiction,2 to wit:
(1) Those between and among stockholders and members;
(2) Those between and among stockholders and members, on one hand, and the
corporation, on the other hand; and
(3) Those between the corporation and the State but only insofar as its franchise or right
to exist as an entity is concerned.
The second test, on the other hand, focuses on the nature of the controversy itself. 3 Recent
decisions of this Court consider not only the subject of their controversy but also the status of the
parties.4
We hold that the Court of Appeals correctly ruled that the regular courts, not the SEC, have
jurisdiction over this case.1âwphi1 Petitioners and private respondent never had any corporate
relations in Phillens. It appears that private respondent was never a stockholder in Phillens, of
which the parties’ predecessor-in-interest, Luciano Pascual, Sr., was a stockholder and whose
properties are being litigated. Private respondent’s allegation is that, upon the death of their father,
he became co-owner in the estate left by him, and part of this estate includes the corporate
interests in Phillens. He also alleges that petitioners repudiated the trust relationship created
between them and appropriated to themselves even the property that should have belonged to
respondent. It is thus clear that there is no corporate relationship involved here. That petitioner
Alfredo Pascual was a corporate officer holding in trust for his brother their father’s corporate
interests did not create an intra-corporate relationship between them.
Nor is the controversy corporate in nature. As we have stated before, the grant of jurisdiction must
be viewed in the light of the nature and function of the SEC under the law. 5 P.D. No. 902-A, §3
gives the SEC jurisdiction, supervision, and control over all corporations, partnerships or
associations, who are the grantees of primary franchise and/or a license or permit issued by the
government to operate in the Philippines. From this, it can be deduced that the regulatory and
adjudicatory functions of the SEC, insofar as intra-corporate controversies are concerned, comes
into play only if a corporation still exists.
In the case at bar, the corporation whose properties are being contested no longer exists, it having
been completely dissolved in 1993; consequently, the supervisory authority of the SEC over the
corporation has likewise come to an end.
It is true that a complaint for accounting, reconveyance, etc. of corporate properties has previously
been held to be within the jurisdiction of the SEC.6 Nonetheless, a distinction can be drawn
between those cases and the case at bar, for, in those cases, the corporations involved were still
existing, whereas in the present case, there is no more corporation involved. There is no question
that assessing the financial status of an existing corporation, for purposes of an action for
accounting, requires the expertise of the SEC. But in the case of a dissolved corporation, no such
expertise is required, for all its business has been properly accounted for already, and what is left
to be determined is properly within the competence of regular courts.
It may be noted in this connection that pursuant to R.A. No. 8799, §5.2,7 which took effect on
August 8, 2000, the jurisdiction of the SEC to decide cases involving intra-corporate dispute was
transferred to courts of general jurisdiction and, in accordance therewith, all cases of this nature,
with the exception only of those submitted for decision, were transferred to the regular courts.
Hence, the question whether this case should be filed in the SEC is now only of academic interest.
For even if it involves an intra-corporate dispute, it would be remanded to the Regional Trial Court
just the same.
Second. Petitioners contend that the lower courts erred in allowing the amendment of the
complaint, which were actually made to confer jurisdiction on the trial court after the original
complaint was dismissed.
This contention has no basis. The original complaint alleged that Phillens has already been
completely dissolved. In addition, it alleged a breach by petitioner Alfredo P. Pascual of the
implied trust created between him and his brother, respondent Ernesto P. Pascual, after the death
of their father. Thus, even without the amendments, the allegations in the original complaint were
sufficient to confer jurisdiction on the trial court. The amendments made by respondent were
merely for the purpose of making more specific his original allegations.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
 THIRD DIVISION case rested with the SEC and, accordingly, granted the petition and ordered the dismissal of the
complaint. The subsequent motion for reconsideration was rebuffed.
G.R. No. 140453 October 17, 2000
Hence, the instant petition.
TRANSFARM & CO., INC., and TRANSDAEWOO AUTOMOTIVE MANUFACTURING
COMPANY, petitioners, The Court required respondents to file their comment and petitioners to file their reply thereon,
vs. respectively, in its resolutions of 25 November 1999 and 21 June 2000.
DAEWOO CORPORATION and DAEWOO MOTOR CO., LTD., respondents.
During the pendency of the petition, Republic Act No. 8799, otherwise also known as The
RESOLUTION Securities Regulation Code, was enacted into law, providing, inter alia, that -

VITUG, J.:
Assailed in the Petition for Review on Certiorari under consideration are the decision and the
resolution of the Court of Appeals, dated 29 July and 13 October 1999, respectively, in CA-G.R.
SP No. 47558.
Sometime in 1994, Daewoo Corporation (Daewoo) entered into a joint venture agreement with
Transfarm & Co. (Transfarm) for the delivery, assembly, production and distribution of Daewoo
cars in the Philippines. Under the agreement, Transdaewoo Automotive Manufacturing Company
(TAMC) was to be incorporated with Transfarm owning seventy percent (70%) and Daewoo
holding thirty percent (30%) of the shares of stock. The new firm was also to undertake the
manufacture, assembly, marketing, wholesale distribution and sale and after-sales service of
Daewoo products. Transfarm and the joint venture company TAMC were then to enter into a
separate agreement that would name Transfarm as the exclusive distributor in the Philippines of
Daewoo cars.
The parties stipulated that any dispute, controversy or claim among the parties arising out of,
relating to, or in connection with the joint venture agreement itself should be settled by arbitration
to be conducted in Hongkong. The joint venture agreement, however, was to be governed by and
construed in accordance with the laws of the Philippines.
"5.2. The Commission's jurisdiction over all cases enumerated under Section 5 of Presidential
Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate
Regional Trial Court: Provided, That the Supreme Court in the exercise of its authority may
designate the Regional Trial Court branches that shall exercise jurisdiction over these cases. The
Commission shall retain jurisdiction over pending cases involving intra-corporate disputes
submitted for final resolution which should be resolved within one (1) year from the enactment of
this Code. The Commission shall retain jurisdiction over pending suspension of
payments/rehabilitation cases filed as of 30 June 2000 until finally disposed." 1
Statutes regulating court jurisdiction and procedures are generally construed to be applicable to
actions pending and undetermined at the time of the passage of said enactments.1âwphi12 The
instant case, neither filed with the Securities and Exchange Commission nor therewith pending, let
alone ready for final resolution by it, is clearly cognizable by the RTC under the amendatory law.
WHEREFORE, the decision of the appellate court subject of the instant petition for review is SET
ASIDE, and the case is REMANDED to the Regional Trial Court of Cebu City for further
proceedings. No costs.
SO ORDERED.

The agreement went awry in December of 1997. Transfarm and TAMC filed a complaint with the
Regional Trial Court (RTC), Branch 5, of Cebu City, docketed Civil Case No. CEB-21367, against
Daewoo and Daewoo Motor Co., Ltd. (DMCL), a corporation organized under the laws of the
Republic of Korea and not doing business in the Philippines, praying that Daewoo and DMCL be
ordered to refrain from conducting and doing, directly or indirectly, automotive business in the
Philippines.

On 20 January 1998, Daewoo and DMCL filed a motion to dismiss the case moored, inter alia, on
the ground that the case involved an intra-corporate dispute cognizable exclusively by the
Securities and Exchange Commission (SEC). In its resolution of 25 March 1998, the RTC denied
the Motion to Dismiss and directed the defendants to file their respective answers.

Transfarm and TAMC filed a petition for certiorari, prohibition and mandamus before the Court of
Appeals. The appellate court, in its 29th July 1999 decision, declared that the jurisdiction over the
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 181416 November 11, 2013
MEDICAL PLAZA MAKATI CONDOMINIUM CORPORATION, Petitioner,
vs.
ROBERT H. CULLEN, Respondent.
DECISION
PERALTA, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court assailing the Court of
Appeals (CA) Decision1 dated July 10, 2007 and Resolution2 dated January 25, 2008 in CA-G.R.
CV No. 86614. The assailed decision reversed and set aside the September 9, 2005 Order 3 of the
Regional Trial Court (RTC) of Makati, Branch 58 in Civil Case No. 03-1018; while the assailed
resolution denied the separate motions for reconsideration filed by petitioner Medical Plaza Makati
Condominium Corporation (MPMCC) and Meridien Land Holding, Inc. (MLHI).
The factual and procedural antecedents are as follows:
Respondent Robert H. Cullen purchased from MLHI condominium Unit No. 1201 of the Medical
Plaza Makati covered by Condominium Certificate of Title No. 45808 of the Register of Deeds of
Makati. Said title was later cancelled and Condominium Certificate of Title No. 64218 was issued
in the name of respondent.
On September 19, 2002, petitioner, through its corporate secretary, Dr. Jose Giovanni E.
Dimayuga, demanded from respondent payment for alleged unpaid association dues and
assessments amounting to ₱145,567.42. Respondent disputed this demand claiming that he had
been religiously paying his dues shown by the fact that he was previously elected president and
director of petitioner.4 Petitioner, on the other hand, claimed that respondent’s obligation was a
carry-over of that of MLHI.5 Consequently, respondent was prevented from exercising his right to
vote and be voted for during the 2002 election of petitioner’s Board of Directors. 6 Respondent thus
clarified from MLHI the veracity of petitioner’s claim, but MLHI allegedly claimed that the same had
already been settled.7 This prompted respondent to demand from petitioner an explanation why he
was considered a delinquent payer despite the settlement of the obligation. Petitioner failed to
make such explanation. Hence, the Complaint for Damages8 filed by respondent against petitioner
and MLHI, the pertinent portions of which read:
xxxx
6. Thereafter, plaintiff occupied the said condominium unit no. 1201 and religiously paid
all the corresponding monthly contributions/association dues and other assessments
imposed on the same. For the years 2000 and 2001, plaintiff served as President and
Director of the Medical Plaza Makati Condominium Corporation;
7. Nonetheless, on September 19, 2002, plaintiff was shocked/surprised to receive a
letter from the incumbent Corporate Secretary of the defendant Medical Plaza Makati,
demanding payment of alleged unpaid association dues and assessments arising from
plaintiff’s condominium unit no. 1201. The said letter further stressed that plaintiff is
considered a delinquent member of the defendant Medical Plaza Makati.
x x x;
8. As a consequence, plaintiff was not allowed to file his certificate of candidacy as
director. Being considered a delinquent, plaintiff was also barred from exercising his right
to vote in the election of new members of the Board of Directors x x x;
9. x x x Again, prior to the said election date, x x x counsel for the defendant [MPMCC]
sent a demand letter to plaintiff, anent the said delinquency, explaining that the said
unpaid amount is a carry-over from the obligation of defendant Meridien. x x x;
10. Verification with the defendant [MPMCC] resulted to the issuance of a certification
stating that Condominium Unit 1201 has an outstanding unpaid obligation in the total
amount of ₱145,567.42 as of November 30, 2002, which again, was attributed by
defendant [MPMCC] to defendant Meridien. x x x;
11. Due to the seriousness of the matter, and the feeling that defendant Meridien made
false representations considering that it fully warranted to plaintiff that condominium unit
1201 is free and clear from all liens and encumbrances, the matter was referred to
counsel, who accordingly sent a letter to defendant Meridien, to demand for the payment
of said unpaid association dues and other assessments imposed on the condominium
unit and being claimed by defendant [MPMCC]. x x x;
12. x x x defendant Meridien claimed however, that the obligation does not exist
considering that the matter was already settled and paid by defendant Meridien to
defendant [MPMCC]. x x x;
13. Plaintiff thus caused to be sent a letter to defendant [MPMCC] x x x. The said letter x
x x sought an explanation on the fact that, as per the letter of defendant Meridien, the
delinquency of unit 1201 was already fully paid and settled, contrary to the claim of
defendant [MPMCC]. x x x;
14. Despite receipt of said letter on April 24, 2003, and to date however, no explanation
was given by defendant [MPMCC], to the damage and prejudice of plaintiff who is again
obviously being barred from voting/participating in the election of members of the board of
directors for the year 2003;
 15. Clearly, defendant [MPMCC] acted maliciously by insisting that plaintiff is a delinquent
member when in fact, defendant Meridien had already paid the said delinquency, if any.
The branding of plaintiff as delinquent member was willfully and deceitfully employed so
as to prevent plaintiff from exercising his right to vote or be voted as director of the
condominium corporation; 16. Defendant [MPMCC]’s ominous silence when confronted
with claim of payment made by defendant Meridien is tantamount to admission that
indeed, plaintiff is not really a delinquent member;
17. Accordingly, as a direct and proximate result of the said acts of defendant [MPMCC],
plaintiff experienced/suffered from mental anguish, moral shock, and serious anxiety.
Plaintiff, being a doctor of medicine and respected in the community further suffered from
social humiliation and besmirched reputation thereby warranting the grant of moral
damages in the amount of ₱500,000.00 and for which defendant [MPMCC] should be
held liable;
18. By way of example or correction for the public good, and as a stern warning to all
similarly situated, defendant [MPMCC] should be ordered to pay plaintiff exemplary
damages in the amount of ₱200,000.00;
19. As a consequence, and so as to protect his rights and interests, plaintiff was
constrained to hire the services of counsel, for an acceptance fee of ₱100,000.00 plus
₱2,500.00 per every court hearing attended by counsel;
20. In the event that the claim of defendant [MPMCC] turned out to be true, however, the
herein defendant Meridien should be held liable instead, by ordering the same to pay the
said delinquency of condominium unit 1201 in the amount of ₱145,567.42 as of
November 30, 2002 as well as the above damages, considering that the non-payment
thereof would be the proximate cause of the damages suffered by plaintiff;9
Petitioner and MLHI filed their separate motions to dismiss the complaint on the ground of lack of
jurisdiction.10MLHI claims that it is the Housing and Land Use Regulatory Board (HLURB) which is
vested with the exclusive jurisdiction to hear and decide the case. Petitioner, on the other hand,
raises the following specific grounds for the dismissal of the complaint: (1) estoppel as respondent
himself approved the assessment when he was the president; (2) lack of jurisdiction as the case
involves an intra-corporate controversy; (3) prematurity for failure of respondent to exhaust all
intra-corporate remedies; and (4) the case is already moot and academic, the obligation having
been settled between petitioner and MLHI.11
On September 9, 2005, the RTC rendered a Decision granting petitioner’s and MLHI’s motions to
dismiss and, consequently, dismissing respondent’s complaint.
The trial court agreed with MLHI that the action for specific performance filed by respondent
clearly falls within the exclusive jurisdiction of the HLURB.12 As to petitioner, the court held that the
complaint states no cause of action, considering that respondent’s obligation had already been
settled by MLHI. It, likewise, ruled that the issues raised are intra-corporate between the
corporation and member.13
On appeal, the CA reversed and set aside the trial court’s decision and remanded the case to the
RTC for further proceedings. Contrary to the RTC conclusion, the CA held that the controversy is
an ordinary civil action for damages which falls within the jurisdiction of regular courts. 14 It
explained that the case hinged on petitioner’s refusal to confirm MLHI’s claim that the subject
obligation had already been settled as early as 1998 causing damage to respondent. 15 Petitioner’s
and MLHI’s motions for reconsideration had also been denied.16
Aggrieved, petitioner comes before the Court based on the following grounds:
I.
THE COURT A QUO HAS DECIDED A QUESTION OF SUBSTANCE, NOT THERETOFORE
DETERMINED BY THE SUPREME COURT, OR HAS DECIDED IT IN A WAY NOT IN ACCORD
WITH LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT
DECLARED THE INSTANT CASE AN ORDINARY ACTION FOR DAMAGES INSTEAD OF AN
INTRA-CORPORATE CONTROVERSY COGNIZABLE BY A SPECIAL COMMERCIAL COURT.
II.
THE COURT A QUO HAS DECIDED THE INSTANT CASE IN A WAY NOT IN ACCORD WITH
LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT TOOK
COGNIZANCE OF THE APPEAL WHILE RAISING ONLY PURE QUESTIONS OF LAW.17
The petition is meritorious.
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the
complaint. It is not affected by the pleas or the theories set up by the defendant in an answer or a
motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely upon the
whims of the defendant.18 Also illuminating is the Court’s pronouncement in Go v. Distinction
Properties Development and Construction, Inc.:19
Basic as a hornbook principle is that jurisdiction over the subject matter of a case is conferred by
law and determined by the allegations in the complaint which comprise a concise statement of the
ultimate facts constituting the plaintiff’s cause of action. The nature of an action, as well as which
court or body has jurisdiction over it, is determined based on the allegations contained in the
complaint of the plaintiff, irrespective of whether or not the plaintiff is entitled to recover upon all or
some of the claims asserted therein. The averments in the complaint and the character of the relief
sought are the ones to be consulted. Once vested by the allegations in the complaint, jurisdiction
also remains vested irrespective of whether or not the plaintiff is entitled to recover upon all or
some of the claims asserted therein. x x x20
Based on the allegations made by respondent in his complaint, does the controversy involve intra-
corporate issues as would fall within the jurisdiction of the RTC sitting as a special commercial
court or an ordinary action for damages within the jurisdiction of regular courts?
In determining whether a dispute constitutes an intra-corporate controversy, the Court uses two
tests, namely, the relationship test and the nature of the controversy test.21
An intra-corporate controversy is one which pertains to any of the following relationships: (1)
between the corporation, partnership or association and the public; (2) between the corporation,
partnership or association and the State insofar as its franchise, permit or license to operate is
concerned; (3) between the corporation, partnership or association and its stockholders, partners,
members or officers; and (4) among the stockholders, partners or associates themselves.22 Thus,
under the relationship test, the existence of any of the above intra-corporate relations makes the
case intra-corporate.23
Under the nature of the controversy test, "the controversy must not only be rooted in the existence
of an intra-corporate relationship, but must as well pertain to the enforcement of the parties’
correlative rights and obligations under the Corporation Code and the internal and intra-corporate
regulatory rules of the corporation."24 In other words, jurisdiction should be determined by
considering both the relationship of the parties as well as the nature of the question involved. 25
Applying the two tests, we find and so hold that the case involves intra-corporate controversy. It
obviously arose from the intra-corporate relations between the parties, and the questions involved
pertain to their rights and obligations under the Corporation Code and matters relating to the
regulation of the corporation.26
Admittedly, petitioner is a condominium corporation duly organized and existing under Philippine
laws, charged with the management of the Medical Plaza Makati. Respondent, on the other hand,
is the registered owner of Unit No. 1201 and is thus a stockholder/member of the condominium
corporation. Clearly, there is an intra-corporate relationship between the corporation and a
stockholder/member.
The nature of the action is determined by the body rather than the title of the
complaint.1âwphi1 Though denominated as an action for damages, an examination of the
allegations made by respondent in his complaint shows that the case principally dwells on the
propriety of the assessment made by petitioner against respondent as well as the validity of
petitioner’s act in preventing respondent from participating in the election of the corporation’s
Board of Directors. Respondent contested the alleged unpaid dues and assessments demanded
by petitioner.
The issue is not novel. The nature of an action involving any dispute as to the validity of the
assessment of association dues has been settled by the Court in Chateau de Baie Condominium
Corporation v. Moreno.27 In that case, respondents therein filed a complaint for intra-corporate
dispute against the petitioner therein to question how it calculated the dues assessed against
them, and to ask an accounting of association dues. Petitioner, however, moved for the dismissal
of the case on the ground of lack of jurisdiction alleging that since the complaint was against the
owner/developer of a condominium whose condominium project was registered with and licensed
by the HLURB, the latter has the exclusive jurisdiction. In sustaining the denial of the motion to
dismiss, the Court held that the dispute as to the validity of the assessments is purely an intra-
corporate matter between petitioner and respondent and is thus within the exclusive jurisdiction of
the RTC sitting as a special commercial court. More so in this case as respondent repeatedly
questioned his characterization as a delinquent member and, consequently, petitioner’s decision
to bar him from exercising his rights to vote and be voted for. These issues are clearly corporate
and the demand for damages is just incidental. Being corporate in nature, the issues should be
threshed out before the RTC sitting as a special commercial court. The issues on damages can
still be resolved in the same special commercial court just like a regular RTC which is still
competent to tackle civil law issues incidental to intra-corporate disputes filed before it.28
Moreover, Presidential Decree No. 902-A enumerates the cases over which the Securities and
Exchange Commission (SEC) exercises exclusive jurisdiction:
xxxx
b) Controversies arising out of intra-corporate or partnership relations, between and
among stockholders, members or associates; between any or all of them and the
corporation, partnership or association of which they are stockholders, members, or
associates, respectively; and between such corporation, partnership or association and
the State insofar as it concerns their individual franchise or right to exist as such entity;
and
c) Controversies in the election or appointment of directors, trustees, officers, or
managers of such corporations, partnerships, or associations.29
To be sure, this action partakes of the nature of an intra-corporate controversy, the jurisdiction
over which pertains to the SEC. Pursuant to Section 5.2 of Republic Act No. 8799, otherwise
known as the Securities Regulation Code, the jurisdiction of the SEC over all cases enumerated
under Section 5 of Presidential Decree No. 902-A has been transferred to RTCs designated by
this Court as Special Commercial Courts.30 While the CA may be correct that the RTC has
jurisdiction, the case should have been filed not with the regular court but with the branch of the
RTC designated as a special commercial court. Considering that the RTC of Makati City, Branch
58 was not designated as a special commercial court, it was not vested with jurisdiction over
cases previously cognizable by the SEC.31The CA, therefore, gravely erred in remanding the case
to the RTC for further proceedings.
Indeed, Republic Act (RA) No. 9904, or the Magna Carta for Homeowners and Homeowners’
Associations, approved on January 7, 2010 and became effective on July 10, 2010, empowers the
HLURB to hear and decide inter-association and/or intra-association controversies or conflicts
concerning homeowners’ associations. However, we cannot apply the same in the present case
as it involves a controversy between a condominium unit owner and a condominium corporation.
While the term association as defined in the law covers homeowners’ associations of other
residential real property which is broad enough to cover a condominium corporation, it does not
seem to be the legislative intent. A thorough review of the deliberations of the bicameral
conference committee would show that the lawmakers did not intend to extend the coverage of the
law to such kind of association. We quote hereunder the pertinent portion of the Bicameral
Conference Committee’s deliberation, to wit:
THE CHAIRMAN (SEN. ZUBIRI). Let’s go back, Mr. Chair, very quickly on homeowners.
THE ACTING CHAIRMAN (REP. ZIALCITA). Ang sa akin lang, I think our views are similar, Your
Honor, Senator Zubiri, the entry of the condominium units might just complicate the whole matters.
So we’d like to put it on record that we’re very much concerned about the plight of the
Condominium Unit Homeowners’ Association. But this could very well be addressed on a separate
bill that I’m willing to co-sponsor with the distinguished Senator Zubiri, to address in the
Condominium Act of the Philippines, rather than address it here because it might just create a red
herring into the entire thing and it will just complicate matters, hindi ba?
THE CHAIRMAN (SEN. ZUBIRI). I also agree with you although I sympathize with them---although
we sympathize with them and we feel that many times their rights have been also violated by
abusive condominium corporations. However, there are certain things that we have to reconcile.
There are certain issues that we have to reconcile with this version.
In the Condominium Code, for example, they just raised a very peculiar situation under the
Condominium Code --- Condominium Corporation Act. It’s five years the proxy, whereas here, it’s
three years. So there would already be violation or there will be already a problem with their
version and our version. Sino ang matutupad doon? Will it be our version or their version?
So I agree that has to be studied further. And because they have a law pertaining to the
condominium housing units, I personally feel that it would complicate matters if we include them.
Although I agree that they should be looked after and their problems be looked into.
Probably we can ask our staff, Your Honor, to come up already with the bill although we have no
more time. Hopefully we can tackle this again on the 15th Congress. But I agree with the
sentiments and the inputs of the Honorable Chair of the House panel.
May we ask our resource persons to also probably give comments?
Atty. Dayrit.
MR. DAYRIT.
Yes I agree with you. There are many, I think, practices in their provisions in the Condominium
Law that may be conflicting with this version of ours.
For instance, in the case of, let’s say, the condominium, the so-called common areas and/or
maybe so called open spaces that they may have, especially common areas, they are usually
owned by the condominium corporation. Unlike a subdivision where the open spaces and/or the
common areas are not necessarily owned by the association. Because sometimes --- generally
these are donated to the municipality or to the city. And it is only when the city or municipality
gives the approval or the conformity that this is donated to the homeowners’ association. But
generally, under PD [Presidential Decree] 957, it’s donated. In the Condominium Corporation,
hindi. Lahat ng mga open spaces and common areas like corridors, the function rooms and
everything, are owned by the corporation. So that’s one main issue that can be conflicting.
THE CHAIRMAN (SEN. ZUBIRI). I’ll just ask for a one-minute suspension so we can talk.
THE ACTING CHAIRMAN (REP. ZIALCITA). Unless you want to put a catchall phrase like what
we did in the Senior Citizen’s Act. Something like, to the extent --- paano ba iyon? To the extent
that it is practicable and applicable, the rights and benefits of the homeowners, are hereby
extended to the --- mayroon kaming ginamit na phrase eh...to the extent that it be practicable and
applicable to the unit homeoweners, is hereby extended, something like that. It’s a catchall
phrase. But then again, it might create a...
MR. JALANDONI. It will become complicated. There will be a lot of conflict of laws between the
two laws.
THE ACTING CHAIRMAN (REP. ZIALCITA). Kaya nga eh. At saka, I don’t know. I think the ---
mayroon naman silang protection sa ano eh, di ba? Buyers decree doon sa Condominium Act. I’m
sure there are provisions there eh. Huwag na lang, huwag na lang.
MR. JALANDONI. Mr. Chairman, I think it would be best if your previous comments that you’d be
supporting an amendment.1âwphi1 I think that would be --- Well, that would be the best course of
action with all due respect.
THE ACTING CHAIRMAN (REP. ZIALCITA). Yeah. Okay. Thank you. So iyon na lang final
proposal naming ‘yung catchall phrase, "With respect to the..."32
xxxx
THE CHAIRMAN (SEN. ZUBIRI). xxx And so, what is their final decision on the definition of
homeowners?
THE ACTING CHAIRMAN (REP. ZIALCITA).
We stick to the original, Mr. Chairman. We’ll just open up a whole can of worms and a whole new
ball game will come into play. Besides, I am not authorized, neither are you, by our counterparts to
include the condominium owners.
THE CHAIRMAN (SEN. ZUBIRI).
Basically that is correct. We are not authorized by the Senate nor – because we have discussed
this lengthily on the floor, actually, several months on the floor. And we don’t have the authority as
well for other Bicam members to add a provision to include a separate entity that has already their
legal or their established Republic Act tackling on that particular issue. But we just like to put on
record, we sympathize with the plight of our friends in the condominium associations and we will
just guarantee them that we will work on an amendment to the Condominium Corporation Code.
So with that – we skipped, that is correct, we have to go back to homeowners’ association
definition, Your Honor, because we had skipped it altogether. So just quickly going back to Page 7
because there are amendments to the definition of homeowners. If it is alright with the House
Panel, adopt the opening phrase of Subsection 7 of the Senate version as opening phrase of
Subsection 10 of the reconciled version.
x x x x33

To be sure, RA 4726 or the Condominium Act was enacted to specifically govern a condominium.
Said law sanctions the creation of the condominium corporation which is especially formed for the
purpose of holding title to the common area, in which the holders of separate interests shall
automatically be members or shareholders, to the exclusion of others, in proportion to the
appurtenant interest of their respective units.34 The rights and obligations of the condominium unit
owners and the condominium corporation are set forth in the above Act.

Clearly, condominium corporations are not covered by the amendment. Thus, the intra-corporate
dispute between petitioner and respondent is still within the jurisdiction of the RTC sitting as a
special commercial court and not the HLURB. The doctrine laid down by the Court in Chateau de
Baie Condominium Corporation v. Moreno35 which in turn cited Wack Wack Condominium
Corporation, et al v. CA36 is still a good law.

WHEREFORE, we hereby GRANT the petition and REVERSE the Court of Appeals Decision
dated July 10, 2007 and Resolution dated January 25, 2008 in CA-G.R. CV No. 86614. The
Complaint before the Regional Trial Court of Makati City, Branch 58, which is not a special
commercial court, docketed as Civil Case No. 03-1018 is ordered DISMISSED for lack of
jurisdiction. Let the case be REMANDED to the Executive Judge of the Regional Trial Court of
Makati City for re-raffle purposes among the designated special commercial courts.

SO ORDERED.
 FIRST DIVISION
G.R. Nos. 160054-55 July 21, 2004
MANOLO P. SAMSON, petitioner,
vs.
HON. REYNALDO B. DAWAY, in his capacity as Presiding Judge, Regional Trial Court of
Quezon City, Branch 90, PEOPLE OF THE PHILIPPINES and CATERPILLAR,
INC., respondents.
DECISION
YNARES-SANTIAGO, J.:
Assailed in this petition for certiorari is the March 26, 2003 Order1 of the Regional Trial Court of
Quezon City, Branch 90, which denied petitioner’s – (1) motion to quash the information; and (2)
motion for reconsideration of the August 9, 2002 Order denying his motion to suspend the
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44. Petitioner also
questioned its August 5, 2003 Order2 which denied his motion for reconsideration.
The undisputed facts show that on March 7, 2002, two informations for unfair competition under
Section 168.3 (a), in relation to Section 170, of the Intellectual Property Code (Republic Act No.
8293), similarly worded save for the dates and places of commission, were filed against petitioner
Manolo P. Samson, the registered owner of ITTI Shoes. The accusatory portion of said
informations read:
That on or about the first week of November 1999 and sometime prior or subsequent
thereto, in Quezon City, Philippines, and within the jurisdiction of this Honorable Court,
above-named accused, owner/proprietor of ITTI Shoes/Mano Shoes Manufactuirng
Corporation located at Robinson’s Galleria, EDSA corner Ortigas Avenue, Quezon City,
did then and there willfully, unlawfully and feloniously distribute, sell and/or offer for sale
CATERPILLAR products such as footwear, garments, clothing, bags, accessories and
paraphernalia which are closely identical to and/or colorable imitations of the authentic
Caterpillar products and likewise using trademarks, symbols and/or designs as would
cause confusion, mistake or deception on the part of the buying public to the damage and
prejudice of CATERPILLAR, INC., the prior adopter, user and owner of the following
internationally: "CATERPILLAR", "CAT", "CATERPILLAR & DESIGN", "CAT AND
DESIGN", "WALKING MACHINES" and "TRACK-TYPE TRACTOR & DESIGN."
CONTRARY TO LAW.3
On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in view
of the existence of an alleged prejudicial question involved in Civil Case No. Q-00-41446 for unfair
competition pending with the same branch; and also in view of the pendency of a petition for
review filed with the Secretary of Justice assailing the Chief State Prosecutor’s resolution finding
probable cause to charge petitioner with unfair competition. In an Order dated August 9, 2002, the
trial court denied the motion to suspend arraignment and other proceedings.
On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for
reconsideration of the order denying motion to suspend, this time challenging the jurisdiction of the
trial court over the offense charged. He contended that since under Section 170 of R.A. No. 8293,
the penalty4 of imprisonment for unfair competition does not exceed six years, the offense is
cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per R.A. No. 7691.
In its assailed March 26, 2003 Order, the trial court denied petitioner’s twin motions.6 A motion for
reconsideration thereof was likewise denied on August 5, 2003.
Hence, the instant petition alleging that respondent Judge gravely abused its discretion in issuing
the assailed orders.
The issues posed for resolution are – (1) Which court has jurisdiction over criminal and civil cases
for violation of intellectual property rights? (2) Did the respondent Judge gravely abuse his
discretion in refusing to suspend the arraignment and other proceedings in Criminal Case Nos. Q-
02-108043-44 on the ground of – (a) the existence of a prejudicial question; and (b) the pendency
of a petition for review with the Secretary of Justice on the finding of probable cause for unfair
competition?
Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for
infringement of registered marks, unfair competition, false designation of origin and false
description or representation, is imprisonment from 2 to 5 years and a fine ranging from Fifty
Thousand Pesos to Two Hundred Thousand Pesos, to wit:
SEC. 170. Penalties. – Independent of the civil and administrative sanctions imposed by
law, a criminal penalty of imprisonment from two (2) years to five (5) years and a fine
ranging from Fifty thousand pesos (P50,000.00) to Two hundred thousand pesos
(P200,000.00), shall be imposed on any person who is found guilty of committing any of
the acts mentioned in Section 155 [Infringement], Section 168 [Unfair Competition] and
Section 169.1 [False Designation of Origin and False Description or Representation].
Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under
Sections 150, 155, 164, 166, 167, 168 and 169 shall be brought before the proper courts with
appropriate jurisdiction under existing laws, thus –
SEC. 163. Jurisdiction of Court. – All actions under Sections 150, 155, 164 and 166 to
169 shall be brought before the proper courts with appropriate jurisdiction under
existing laws. (Emphasis supplied)
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The
Trademark Law) which provides that jurisdiction over cases for infringement of registered marks,
unfair competition, false designation of origin and false description or representation, is lodged
with the Court of First Instance (now Regional Trial Court) –
SEC. 27. Jurisdiction of Court of First Instance. – All actions under this Chapter [V –
Infringement] and Chapters VI [Unfair Competition] and VII [False Designation of Origin
and False Description or Representation], hereof shall be brought before the Court of
First Instance.
We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. No.
8293. The repealing clause of R.A. No. 8293, reads –
SEC. 239. Repeals. – 239.1. All Acts and parts of Acts inconsistent herewith, more
particularly Republic Act No. 165, as amended; Republic Act No. 166, as amended; and
Articles 188 and 189 of the Revised Penal Code; Presidential Decree No. 49, including
Presidential Decree No. 285, as amended, are hereby repealed. (Emphasis added)
Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, it
would not have used the phrases "parts of Acts" and "inconsistent herewith;" and it would have
simply stated "Republic Act No. 165, as amended; Republic Act No. 166, as amended; and
Articles 188 and 189 of the Revised Penal Code; Presidential Decree No. 49, including
Presidential Decree No. 285, as amended are hereby repealed." It would have removed all doubts
that said specific laws had been rendered without force and effect. The use of the phrases "parts
of Acts"and "inconsistent herewith" only means that the repeal pertains only to provisions which
are repugnant or not susceptible of harmonization with R.A. No. 8293.6 Section 27 of R.A. No.
166, however, is consistent and in harmony with Section 163 of R.A. No. 8293. Had R.A. No. 8293
intended to vest jurisdiction over violations of intellectual property rights with the Metropolitan Trial
Courts, it would have expressly stated so under Section 163 thereof.
Moreover, the settled rule in statutory construction is that in case of conflict between a general law
and a special law, the latter must prevail. Jurisdiction conferred by a special law to Regional Trial
Courts must prevail over that granted by a general law to Municipal Trial Courts.7
In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws8 conferring jurisdiction over
violations of intellectual property rights to the Regional Trial Court. They should therefore prevail
over R.A. No. 7691, which is a general law.9 Hence, jurisdiction over the instant criminal case for
unfair competition is properly lodged with the Regional Trial Court even if the penalty therefor is
imprisonment of less than 6 years, or from 2 to 5 years and a fine ranging from P50,000.00 to
P200,000.00.
In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual
property rights under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19,
2002 designating certain Regional Trial Courts as Intellectual Property Courts. On June 17, 2003,
the Court further issued a Resolution consolidating jurisdiction to hear and decide Intellectual
Property Code and Securities and Exchange Commission cases in specific Regional Trial Courts
designated as Special Commercial Courts.
The case of Mirpuri v. Court of Appeals,10 invoked by petitioner finds no application in the present
case. Nowhere in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed by R.A. No.
8293. Neither did we make a categorical ruling therein that jurisdiction over cases for violation of
intellectual property rights is lodged with the Municipal Trial Courts. The passing remark
in Mirpuri on the repeal of R.A. No. 166 by R.A. No. 8293 was merely a backgrounder to the
enactment of the present Intellectual Property Code and cannot thus be construed as a
jurisdictional pronouncement in cases for violation of intellectual property rights.
Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial
question. In his petition, he prayed for the reversal of the March 26, 2003 order which sustained
the denial of his motion to suspend arraignment and other proceedings in Criminal Case Nos. Q-
02-108043-44. For unknown reasons, however, he made no discussion in support of said prayer
in his petition and reply to comment. Neither did he attach a copy of the complaint in Civil Case
No. Q-00-41446 nor quote the pertinent portion thereof to prove the existence of a prejudicial
question.
At any rate, there is no prejudicial question if the civil and the criminal action can, according to law,
proceed independently of each other.11 Under Rule 111, Section 3 of the Revised Rules on
Criminal Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the
independent civil action may be brought by the offended party. It shall proceed independently of
the criminal action and shall require only a preponderance of evidence.
In the case at bar, the common element in the acts constituting unfair competition under Section
168 of R.A. No. 8293 is fraud.12 Pursuant to Article 33 of the Civil Code, in cases of
defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct
from the criminal action, may be brought by the injured party. Hence, Civil Case No. Q-00-41446,
which as admitted13 by private respondent also relate to unfair competition, is an independent
civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question
that will justify the suspension of the criminal cases at bar.
Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides –
SEC. 11. Suspension of arraignment. – Upon motion by the proper party, the arraignment
shall be suspended in the following cases –
xxxxxxxxx
(c) A petition for review of the resolution of the prosecutor is pending at either the
Department of Justice, or the Office of the President; Provided, that the period of
suspension shall not exceed sixty (60) days counted from the filing of the petition with the
reviewing office.
While the pendency of a petition for review is a ground for suspension of the arraignment, the
aforecited provision limits the deferment of the arraignment to a period of 60 days reckoned from
the filing of the petition with the reviewing office. It follows, therefore, that after the expiration of
said period, the trial court is bound to arraign the accused or to deny the motion to defer
arraignment.
In the instant case, petitioner failed to establish that respondent Judge abused his discretion in
denying his motion to suspend. His pleadings and annexes submitted before the Court do not
show the date of filing of the petition for review with the Secretary of Justice.14 Moreover, the
Order dated August 9, 2002 denying his motion to suspend was not appended to the petition. He
thus failed to discharge the burden of proving that he was entitled to a suspension of his
arraignment and that the questioned orders are contrary to Section 11 (c), Rule 116 of the
Revised Rules on Criminal Procedure. Indeed, the age-old but familiar rule is that he who alleges
must prove his allegations.

In sum, the dismissal of the petition is proper considering that petitioner has not established that
the trial court committed grave abuse of discretion. So also, his failure to attach documents
relevant to his allegations warrants the dismissal of the petition, pursuant to Section 3, Rule 46 of
the Rules of Civil Procedure, which states:

SEC. 3. Contents and filing of petition; effect of non-compliance with

requirements. — The petition shall contain the full names and actual addresses of all the
petitioners and respondents, a concise statement of the matters involved, the factual
background of the case, and the grounds relied upon for the relief prayed for.

It shall be filed in seven (7) clearly legible copies together with proof of service thereof on
the respondent with the original copy intended for the court indicated as such by the
petitioner, and shall be accompanied by a clearly legible duplicate original or
certified true copy of the judgment, order, resolution, or ruling subject thereof,
such material portions of the record as are referred to therein, and other
documents relevant or pertinent thereto.

xxxxxxxxx

The failure of the petitioner to comply with any of the foregoing requirements shall
be sufficient ground for the dismissal of the petition. (Emphasis added)

WHEREFORE, in view of all the foregoing, the petition is dismissed.

SO ORDERED.
 THIRD DIVISION not find them there and the barangay office of Sta. Clara, Lamitan, Basilan, issued a
certification3 that respondent was no longer residing there.
G.R. No. 154598 August 16, 2004
Petitioner gave up his search when he got hold of respondent’s cellular phone bills showing calls
IN THE MATTER OF APPLICATION FOR THE ISSUANCE OF A WRIT OF HABEAS CORPUS from different places such as Cavite, Nueva Ecija, Metro Manila and other provinces. Petitioner
RICHARD BRIAN THORNTON for and in behalf of the minor child SEQUEIRA JENNIFER then filed another petition for habeas corpus, this time in the Court of Appeals which could issue a
DELLE FRANCISCO THORNTON, petitioner, writ of habeas corpus enforceable in the entire country.
vs.
ADELFA FRANCISCO THORNTON, respondent. However, the petition was denied by the Court of Appeals on the ground that it did not have
jurisdiction over the case. It ruled that since RA 8369 (The Family Courts Act of 1997) gave family
courts exclusive original jurisdiction over petitions for habeas corpus, it impliedly repealed RA
7902 (An Act Expanding the Jurisdiction of the Court of Appeals) and Batas Pambansa 129 (The
Judiciary Reorganization Act of 1980):
DECISION
Under Sec. 9 (1), BP 129 (1981) the Intermediate Appellate Court (now Court of Appeals)
has jurisdiction to issue a writ of habeas corpus whether or not in aid of its appellate
jurisdiction. This conferment of jurisdiction was re-stated in Sec. 1, RA 7902 (1995), an
act expanding the jurisdiction of this Court. This jurisdiction finds its procedural
expression in Sec. 1, Rule 102 of the Rules of Court.
CORONA, J.:
In 1997, RA 8369 otherwise known as Family Courts Act was enacted. It provides:
This is a petition to review, under Rule 45 of the Rules of Court, the July 5, 2002 resolution1 of the
Court of Appeals, Sixteenth Division, in CA G.R. SP No. 70501 dismissing the petition for habeas
Sec. 5. Jurisdiction of Family Court. – The Family Courts shall have exclusive
corpus on the grounds of lack of jurisdiction and lack of substance. The dispositive portion2 read:
original jurisdiction to hear and decide the following cases:

WHEREFORE, the Court DISMISSES the petition for habeas corpus on the grounds that: xxx xxx xxx
a) this Court has no jurisdiction over the subject matter of the petition; and b) the petition
is not sufficient in substance.
b. Petition for guardianship, custody of children, habeas corpus in
relation to the latter.
Petitioner, an American, and respondent, a Filipino, were married on August 28, 1998 in the
Catholic Evangelical Church at United Nations Avenue, Manila. A year later, respondent gave birth
to a baby girl whom they named Sequeira Jennifer Delle Francisco Thornton. The vital question is, did RA 8369 impliedly repeal BP 129 and RA 7902 insofar as the
jurisdiction of this Court to issue writ of habeas corpus in custody of minor cases is
concerned? The simple answer is, yes, it did, because there is no other meaning of the
However, after three years, respondent grew restless and bored as a plain housewife. She wanted
word "exclusive" than to constitute the Family Court as the sole court which can issue
to return to her old job as a "guest relations officer" in a nightclub, with the freedom to go out with
said writ. If a court other than the Family Court also possesses the same competence,
her friends. In fact, whenever petitioner was out of the country, respondent was also often out with
then the jurisdiction of the former is not exclusive but concurrent – and such an
her friends, leaving her daughter in the care of the househelp. interpretation is contrary to the simple and clear wording of RA 8369.

Petitioner admonished respondent about her irresponsibility but she continued her carefree ways.
Petitioner argues that unless this Court assumes jurisdiction over a petition for habeas
On December 7, 2001, respondent left the family home with her daughter Sequiera without
corpus involving custody of minors, a respondent can easily evade the service of a writ of
notifying her husband. She told the servants that she was bringing Sequiera to Purok Marikit, Sta.
habeas corpus on him or her by just moving out of the region over which the Regional
Clara, Lamitan, Basilan Province.
Trial Court issuing the writ has territorial jurisdiction. That may be so but then jurisdiction
is conferred by law. In the absence of a law conferring such jurisdiction in this Court, it
Petitioner filed a petition for habeas corpus in the designated Family Court in Makati City but this cannot exercise it even if it is demanded by expediency or necessity.
was dismissed, presumably because of the allegation that the child was in Basilan. Petitioner then
went to Basilan to ascertain the whereabouts of respondent and their daughter. However, he did
 Whether RA 8369 is a good or unwise law is not within the authority of this Court – or any
court for that matter – to determine. The enactment of a law on jurisdiction is within the
exclusive domain of the legislature. When there is a perceived defect in the law, the
remedy is not to be sought form the courts but only from the legislature.
The only issue before us therefore is whether the Court of Appeals has jurisdiction to issue writs of
habeas corpus in cases involving custody of minors in the light of the provision in RA 8369 giving
family courts exclusive original jurisdiction over such petitions.
In his comment, the Solicitor General points out that Section 20 of the Rule on Custody of Minors
and Writ of Habeas Corpus in Relation to Custody of Minors (A.M. No. 03-04-04-SC, effective May
15, 2003) has rendered the issue moot. Section 20 of the rule provides that a petition for habeas
corpus may be filed in the Supreme Court,4Court of Appeals, or with any of its members and, if so
granted, the writ shall be enforceable anywhere in the Philippines.5
The petition is granted.
The Court of Appeals should take cognizance of the case since there is nothing in RA 8369 that
revoked its jurisdiction to issue writs of habeas corpus involving the custody of minors.
The Court of Appeals opines that RA 8369 impliedly repealed RA 7902 and BP 129 since, by
giving family courts exclusive jurisdiction over habeas corpus cases, the lawmakers intended it to
be the sole court which can issue writs of habeas corpus. To the court a quo, the word "exclusive"
apparently cannot be construed any other way.
We disagree with the CA’s reasoning because it will result in an iniquitous situation, leaving
individuals like petitioner without legal recourse in obtaining custody of their children. Individuals
who do not know the whereabouts of minors they are looking for would be helpless since they
cannot seek redress from family courts whose writs are enforceable only in their respective
territorial jurisdictions. Thus, if a minor is being transferred from one place to another, which
seems to be the case here, the petitioner in a habeas corpus case will be left without legal
remedy. This lack of recourse could not have been the intention of the lawmakers when they
passed the Family Courts Act of 1997. As observed by the Solicitor General:
Under the Family Courts Act of 1997, the avowed policy of the State is to "protect the
rights and promote the welfare of children." The creation of the Family Court is geared
towards addressing three major issues regarding children’s welfare cases, as expressed
by the legislators during the deliberations for the law. The legislative intent behind giving
Family Courts exclusive and original jurisdiction over such cases was to avoid further
clogging of regular court dockets, ensure greater sensitivity and specialization in view of
the nature of the case and the parties, as well as to guarantee that the privacy of the
children party to the case remains protected.
The primordial consideration is the welfare and best interests of the child. We rule therefore that
RA 8369 did not divest the Court of Appeals and the Supreme Court of their jurisdiction over
habeas corpus cases involving the custody of minors. Again, to quote the Solicitor General:
To allow the Court of Appeals to exercise jurisdiction over the petition for habeas corpus
involving a minor child whose whereabouts are uncertain and transient will not result in
one of the situations that the legislature seeks to avoid. First, the welfare of the child is
paramount. Second, the ex parte nature of habeas corpus proceedings will not result in
disruption of the child’s privacy and emotional well-being; whereas to deprive the
appellate court of jurisdiction will result in the evil sought to be avoided by the legislature:
the child’s welfare and well being will be prejudiced.
This is not the first time that this Court construed the word "exclusive" as not foreclosing resort to
another jurisdiction. As correctly cited by the Solicitor General, in Floresca vs. Philex Mining
Corporation,6 the heirs of miners killed in a work-related accident were allowed to file suit in the
regular courts even if, under the Workmen’s Compensation Act, the Workmen’s Compensation
Commissioner had exclusive jurisdiction over such cases.
We agree with the observations of the Solicitor General that:
While Floresca involved a cause of action different from the case at bar. it supports
petitioner’s submission that the word "exclusive" in the Family Courts Act of 1997 may not
connote automatic foreclosure of the jurisdiction of other courts over habeas corpus
cases involving minors. In the same manner that the remedies in the Floresca case were
selective, the jurisdiction of the Court of Appeals and Family Court in the case at bar is
concurrent. The Family Court can issue writs of habeas corpus enforceable only within its
territorial jurisdiction. On the other hand, in cases where the territorial jurisdiction for the
enforcement of the writ cannot be determined with certainty, the Court of Appeals can
issue the same writ enforceable throughout the Philippines, as provided in Sec. 2, Rule
102 of the Revised Rules of Court, thus:
The Writ of Habeas Corpus may be granted by the Supreme Court, or any
member thereof, on any day and at any time, or by the Court of Appeals or any
member thereof in the instances authorized by law, and if so granted it shall be
enforceable anywhere in the Philippines, and may be made returnable before the
court or any member thereof, or before a Court of First Instance, or any judge
thereof for hearing and decision on the merits. It may also be granted by a Court
of First Instance, or a judge thereof, on any day and at any time, and returnable
before himself, enforceable only within his judicial district. (Emphasis supplied)
In ruling that the Commissioner’s "exclusive" jurisdiction did not foreclose resort to the regular
courts for damages, this Court, in the same Floresca case, said that it was merely applying and
giving effect to the constitutional guarantees of social justice in the 1935 and 1973 Constitutions
and implemented by the Civil Code. It also applied the well-established rule that what is controlling
is the spirit and intent, not the letter, of the law:
"Idolatrous reverence" for the law sacrifices the human being. The spirit of the law insures
man’s survival and ennobles him. In the words of Shakespeare, "the letter of the law
killeth; its spirit giveth life."
xxx xxx xxx
 It is therefore patent that giving effect to the social justice guarantees of the Constitution,
as implemented by the provisions of the New Civil Code, is not an exercise of the power
of law-making, but is rendering obedience to the mandates of the fundamental law and
the implementing legislation aforementioned.
Language is rarely so free from ambiguity as to be incapable of being used in more than one
sense. Sometimes, what the legislature actually had in mind is not accurately reflected in the
language of a statute, and its literal interpretation may render it meaningless, lead to absurdity,
injustice or contradiction.7 In the case at bar, a literal interpretation of the word "exclusive" will
result in grave injustice and negate the policy "to protect the rights and promote the welfare of
children"8 under the Constitution and the United Nations Convention on the Rights of the Child.
This mandate must prevail over legal technicalities and serve as the guiding principle in construing
the provisions of RA 8369.
Moreover, settled is the rule in statutory construction that implied repeals are not favored:
within the region where the petitioner resides or where the minor may be found for
hearing and decision on the merits. (Emphasis Ours)
From the foregoing, there is no doubt that the Court of Appeals and Supreme Court have
concurrent jurisdiction with family courts in habeas corpus cases where the custody of minors is
involved.
One final note. Requiring the serving officer to search for the child all over the country is not an
unreasonable availment of a remedy which the Court of Appeals cited as a ground for dismissing
the petition. As explained by the Solicitor General:10
That the serving officer will have to "search for the child all over the country" does not
represent an insurmountable or unreasonable obstacle, since such a task is no more
different from or difficult than the duty of the peace officer in effecting a warrant of arrest,
since the latter is likewise enforceable anywhere within the Philippines.

The two laws must be absolutely incompatible, and a clear finding thereof must surface, WHEREFORE, the petition is hereby GRANTED. The petition for habeas corpus in CA-G.R.-SP-
before the inference of implied repeal may be drawn. The rule is expressed in the No. 70501 is hereby REINSTATED and REMANDED to the Court of Appeals, Sixteenth Division.
maxim, interpretare et concordare leqibus est optimus interpretendi, i.e., every statute
must be so interpreted and brought into accord with other laws as to form a uniform
SO ORDERED.
system of jurisprudence. The fundament is that the legislature should be presumed to
have known the existing laws on the subject and not have enacted conflicting statutes.
Hence, all doubts must be resolved against any implied repeal, and all efforts should be
exerted in order to harmonize and give effect to all laws on the subject."9

The provisions of RA 8369 reveal no manifest intent to revoke the jurisdiction of the Court of
Appeals and Supreme Court to issue writs of habeas corpus relating to the custody of minors.
Further, it cannot be said that the provisions of RA 8369, RA 7092 and BP 129 are absolutely
incompatible since RA 8369 does not prohibit the Court of Appeals and the Supreme Court from
issuing writs of habeas corpus in cases involving the custody of minors. Thus, the provisions of RA
8369 must be read in harmony with RA 7029 and BP 129 ― that family courts have concurrent
jurisdiction with the Court of Appeals and the Supreme Court in petitions for habeas corpus where
the custody of minors is at issue.

In any case, whatever uncertainty there was has been settled with the adoption of A.M. No. 03-03-
04-SC Re: Rule on Custody of Minors and Writ of Habeas Corpus in Relation to Custody of
Minors. Section 20 of the rule provides that:

Section 20. Petition for writ of habeas corpus.- A verified petition for a writ of habeas
corpus involving custody of minors shall be filed with the Family Court. The writ shall be
enforceable within its judicial region to which the Family Court belongs.

xxx xxx xxx

The petition may likewise be filed with the Supreme Court, Court of Appeals, or with any
of its members and, if so granted, the writ shall be enforceable anywhere in the
Philippines. The writ may be made returnable to a Family Court or to any regular court
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 159374 July 12, 2007
FELIPE N. MADRIÑAN, Petitioner,
vs.
FRANCISCA R. MADRIÑAN, Respondent.
DECISION
CORONA, J.:
When a family breaks up, the children are always the victims. The ensuing battle for custody of the
minor children is not only a thorny issue but also a highly sensitive and heart-rending affair. Such
is the case here. Even the usually technical subject of jurisdiction became emotionally charged.
Petitioner Felipe N. Madriñan and respondent Francisca R. Madriñan were married on July 7,
1993 in Parañaque City. They resided in San Agustin Village, Brgy. Moonwalk, Parañaque City.
Their union was blessed with three sons and a daughter: Ronnick, born on January 30, 1994;
Phillip, born on November 19, 1996; Francis Angelo, born on May 12, 1998 and Krizia Ann, born
on December 12, 2000.
After a bitter quarrel on May 18, 2002, petitioner allegedly left their conjugal abode and took their
three sons with him to Ligao City, Albay and subsequently to Sta. Rosa, Laguna. Respondent
sought the help of her parents and parents-in-law to patch things up between her and petitioner to
no avail. She then brought the matter to the Lupong Tagapamayapa in their barangay but this too
proved futile.
Thus respondent filed a petition for habeas corpus of Ronnick, Phillip and Francis Angelo in the
Court of Appeals, alleging that petitioner’s act of leaving the conjugal dwelling and going to Albay
and then to Laguna disrupted the education of their children and deprived them of their mother’s
care. She prayed that petitioner be ordered to appear and produce their sons before the court and
to explain why they should not be returned to her custody.
Petitioner and respondent appeared at the hearing on September 17, 2002. They initially agreed
that petitioner would return the custody of their three sons to respondent. Petitioner, however, had
a change of heart1 and decided to file a memorandum.
On September 3, 2002, petitioner filed his memorandum2 alleging that respondent was unfit to
take custody of their three sons because she was habitually drunk, frequently went home late at
night or in the wee hours of the morning, spent much of her time at a beer house and neglected
her duties as a mother. He claimed that, after their squabble on May 18, 2002, it was respondent
who left, taking their daughter with her. It was only then that he went to Sta. Rosa, Laguna where
he worked as a tricycle driver. He submitted a certification from the principal of the Dila
Elementary School in Sta. Rosa, Laguna that Ronnick and Phillip were enrolled there. He also
questioned the jurisdiction of the Court of Appeals claiming that under Section 5(b) of RA 8369
(otherwise known as the "Family Courts Act of 1997") family courts have exclusive original
jurisdiction to hear and decide the petition for habeas corpus filed by respondent.3
For her part, respondent averred that she did not leave their home on May 18, 2002 but was
driven out by petitioner. She alleged that it was petitioner who was an alcoholic, gambler and drug
addict. Petitioner’s alcoholism and drug addiction impaired his mental faculties, causing him to
commit acts of violence against her and their children. The situation was aggravated by the fact
that their home was adjacent to that of her in-laws who frequently meddled in their personal
problems.4
On October 21, 2002, the Court of Appeals5 rendered a decision6 asserting its authority to take
cognizance of the petition and ruling that, under Article 213 of the Family Code, respondent was
entitled to the custody of Phillip and Francis Angelo who were at that time aged six and four,
respectively, subject to the visitation rights of petitioner. With respect to Ronnick who was then
eight years old, the court ruled that his custody should be determined by the proper family court in
a special proceeding on custody of minors under Rule 99 of the Rules of Court.
Petitioner moved for reconsideration of the Court of Appeals decision but it was denied. Hence,
this recourse.
Petitioner challenges the jurisdiction of the Court of Appeals over the petition for habeas
corpus and insists that jurisdiction over the case is lodged in the family courts under RA 8369. He
invokes Section 5(b) of RA 8369:
Section 5. Jurisdiction of Family Courts. – The Family Courts shall have exclusive original
jurisdiction to hear and decide the following cases:
xxx xxx xxx
b) Petitions for guardianship, custody of children, habeas corpus in relation to the latter;
xxx xxx xxx
Petitioner is wrong.
In Thornton v. Thornton,7 this Court resolved the issue of the Court of Appeals’ jurisdiction to issue
writs of habeas corpus in cases involving custody of minors in the light of the provision in RA 8369
giving family courts exclusive original jurisdiction over such petitions:
The Court of Appeals should take cognizance of the case since there is nothing in RA 8369 We note that after petitioner moved out of their Parañaque residence on May 18, 2002, he twice
that revoked its jurisdiction to issue writs of habeas corpus involving the custody of transferred his sons to provinces covered by different judicial regions. This situation is what
minors. the Thornton interpretation of RA 8369’s provision on jurisdiction precisely addressed:

xxx xxx xxx
We rule therefore that RA 8369 did not divest the Court of Appeals and the Supreme Court of
their jurisdiction over habeas corpus cases involving the custody of minors.
xxx xxx xxx
The provisions of RA 8369 reveal no manifest intent to revoke the jurisdiction of the Court of
Appeals and Supreme Court to issue writs of habeas corpus relating to the custody of minors.
Further, it cannot be said that the provisions of RA 8369, RA 7092 [An Act Expanding the
Jurisdiction of the Court of Appeals] and BP 129 [The Judiciary Reorganization Act of 1980] are
absolutely incompatible since RA 8369 does not prohibit the Court of Appeals and the Supreme
Court from issuing writs of habeas corpus in cases involving the custody of minors. Thus, the
provisions of RA 8369 must be read in harmony with RA 7029 and BP 129 – that family courts
have concurrent jurisdiction with the Court of Appeals and the Supreme Court in petitions
for habeas corpus where the custody of minors is at issue.8 (emphases supplied)
The jurisdiction of the Court of Appeals over petitions for habeas corpus was further affirmed by
A.M. No. 03-03-04-SC (April 22, 2004) in Re: Rule on Custody of Minors and Writ of Habeas
Corpus in Relation to Custody of Minors:
In any case, whatever uncertainty there was has been settled with the adoption of A.M. No.
03-03-04-SC Re: Rule on Custody of Minors and Writ of Habeas Corpus in Relation to
Custody of Minors. Section 20 of the rule provides that:
[The reasoning that by giving family courts exclusive jurisdiction over habeas corpus cases, the
lawmakers intended them to be the sole courts which can issue writs of habeas corpus] will result
in an iniquitous situation, leaving individuals like [respondent] without legal recourse in obtaining
custody of their children. Individuals who do not know the whereabouts of minors they are looking
for would be helpless since they cannot seek redress from family courts whose writs are
enforceable only in their respective territorial jurisdictions. Thus, if a minor is being transferred
from one place to another, which seems to be the case here, the petitioner in a habeas
corpuscase will be left without legal remedy. This lack of recourse could not have been the
intention of the lawmakers when they passed [RA 8369].10
Moreover, a careful reading of Section 5(b) of RA 8369 reveals that family courts are vested with
original exclusive jurisdiction in custody cases, not in habeas corpus cases. Writs of habeas
corpus which may be issued exclusively by family courts under Section 5(b) of RA 8369 pertain to
the ancillary remedy that may be availed of in conjunction with a petition for custody of minors
under Rule 99 of the Rules of Court. In other words, the issuance of the writ is merely ancillary to
the custody case pending before the family court. The writ must be issued by the same court to
avoid splitting of jurisdiction, conflicting decisions, interference by a co-equal court and judicial
instability.
The rule therefore is: when by law jurisdiction is conferred on a court or judicial officer, all auxiliary
writs, processes and other means necessary to carry it into effect may be employed by such court
or officer.11 Once a court acquires jurisdiction over the subject matter of a case, it does so to the
exclusion of all other courts, including related incidents and ancillary matters.
Accordingly, the petition is hereby DENIED.

Section 20. Petition for writ of habeas corpus. – A verified petition for a writ of habeas corpus Costs against petitioner.
involving custody of minors shall be filed with the Family Court. The writ shall be enforceable
within its judicial region to which the Family Court belongs.
SO ORDERED.
xxx xxx xxx

The petition may likewise be filed with the Supreme Court, Court of Appeals, or with any of its
members and, if so granted, the writ shall be enforceable anywhere in the Philippines. The
writ may be made returnable to a Family Court or to any regular court within the region where the
petitioner resides or where the minor may be found for hearing and decision on the merits.

From the foregoing, there is no doubt that the Court of Appeals and Supreme Court have
concurrent jurisdiction with family courts in habeas corpus cases where the custody of
minors is involved.9 (emphases supplied)1avvphi1
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 179267 June 25, 2013
JESUS C. GARCIA, Petitioner,
vs.
THE HONORABLE RAY ALAN T. DRILON, Presiding Judge, Regional Trial Court-Branch 41,
Bacolod City, and ROSALIE JAYPE-GARCIA, for herself and in behalf of minor children,
namely: JO-ANN, JOSEPH EDUARD, JESSE ANTHONE, all surnamed
GARCIA, Respondents.
DECISION
PERLAS-BERNABE, J.:
Hailed as the bastion of Christianity in Asia, the Philippines boasts of 86.8 million Filipinos- or 93
percent of a total population of 93.3 million – adhering to the teachings of Jesus Christ.1 Yet, the
admonition for husbands to love their wives as their own bodies just as Christ loved the church
and gave himself up for her2 failed to prevent, or even to curb, the pervasiveness of violence
against Filipino women. The National Commission on the Role of Filipino Women (NCRFW)
reported that, for the years 2000-2003, "female violence comprised more than 90o/o of all forms of
abuse and violence and more than 90% of these reported cases were committed by the women's
intimate partners such as their husbands and live-in partners."3
Thus, on March 8, 2004, after nine (9) years of spirited advocacy by women's groups, Congress
enacted Republic Act (R.A.) No. 9262, entitled "An Act Defining Violence Against Women and
Their Children, Providing for Protective Measures for Victims, Prescribing Penalties Therefor, and
for Other Purposes." It took effect on March 27, 2004.4
R.A. 9262 is a landmark legislation that defines and criminalizes acts of violence against women
and their children (VAWC) perpetrated by women's intimate partners, i.e, husband; former
husband; or any person who has or had a sexual or dating relationship, or with whom the woman
has a common child.5 The law provides for protection orders from the barangay and the courts to
prevent the commission of further acts of VAWC; and outlines the duties and responsibilities of
barangay officials, law enforcers, prosecutors and court personnel, social workers, health care
providers, and other local government officials in responding to complaints of VAWC or requests
for assistance.
A husband is now before the Court assailing the constitutionality of R.A. 9262 as being violative of
the equal protection and due process clauses, and an undue delegation of judicial power to
barangay officials.
The Factual Antecedents
On March 23, 2006, Rosalie Jaype-Garcia (private respondent) filed, for herself and in behalf of
her minor children, a verified petition6 (Civil Case No. 06-797) before the Regional Trial Court
(RTC) of Bacolod City for the issuance of a Temporary Protection Order (TPO) against her
husband, Jesus C. Garcia (petitioner), pursuant to R.A. 9262. She claimed to be a victim of
physical abuse; emotional, psychological, and economic violence as a result of marital infidelity on
the part of petitioner, with threats of deprivation of custody of her children and of financial support. 7
Private respondent's claims
Private respondent married petitioner in 2002 when she was 34 years old and the former was
eleven years her senior. They have three (3) children, namely: Jo-Ann J. Garcia, 17 years old,
who is the natural child of petitioner but whom private respondent adopted; Jessie Anthone J.
Garcia, 6 years old; and Joseph Eduard J. Garcia, 3 years old.8
Private respondent described herself as a dutiful and faithful wife, whose life revolved around her
husband. On the other hand, petitioner, who is of Filipino-Chinese descent, is dominant,
controlling, and demands absolute obedience from his wife and children. He forbade private
respondent to pray, and deliberately isolated her from her friends. When she took up law, and
even when she was already working part time at a law office, petitioner trivialized her ambitions
and prevailed upon her to just stay at home. He was often jealous of the fact that his attractive
wife still catches the eye of some men, at one point threatening that he would have any man
eyeing her killed.9
Things turned for the worse when petitioner took up an affair with a bank manager of Robinson's
Bank, Bacolod City, who is the godmother of one of their sons. Petitioner admitted to the affair
when private respondent confronted him about it in 2004. He even boasted to the household help
about his sexual relations with said bank manager. Petitioner told private respondent, though, that
he was just using the woman because of their accounts with the bank.10
Petitioner's infidelity spawned a series of fights that left private respondent physically and
emotionally wounded. In one of their quarrels, petitioner grabbed private respondent on both arms
and shook her with such force that caused bruises and hematoma. At another time, petitioner hit
private respondent forcefully on the lips that caused some bleeding. Petitioner sometimes turned
his ire on their daughter, Jo-Ann, who had seen the text messages he sent to his paramour and
whom he blamed for squealing on him. He beat Jo-Ann on the chest and slapped her many times.
When private respondent decided to leave petitioner, Jo-Ann begged her mother to stay for fear
that if the latter leaves, petitioner would beat her up. Even the small boys are aware of private
respondent's sufferings. Their 6-year-old son said that when he grows up, he would beat up his
father because of his cruelty to private respondent.11
All the emotional and psychological turmoil drove private respondent to the brink of despair. On
December 17, 2005, while at home, she attempted suicide by cutting her wrist. She was found by
her son bleeding on the floor. Petitioner simply fled the house instead of taking her to the hospital.
Private respondent was hospitalized for about seven (7) days in which time petitioner never
bothered to visit, nor apologized or showed pity on her. Since then, private respondent has been
undergoing therapy almost every week and is taking anti-depressant medications.12
When private respondent informed the management of Robinson's Bank that she intends to file
charges against the bank manager, petitioner got angry with her for jeopardizing the manager's
job. He then packed his things and told private respondent that he was leaving her for good. He
even told private respondent's mother, who lives with them in the family home, that private
respondent should just accept his extramarital affair since he is not cohabiting with his paramour
and has not sired a child with her.13
Private respondent is determined to separate from petitioner but she is afraid that he would take
her children from her and deprive her of financial support. Petitioner had previously warned her
that if she goes on a legal battle with him, she would not get a single centavo.14
Petitioner controls the family businesses involving mostly the construction of deep wells. He is the
President of three corporations – 326 Realty Holdings, Inc., Negros Rotadrill Corporation, and J-
Bros Trading Corporation – of which he and private respondent are both stockholders. In contrast
to the absolute control of petitioner over said corporations, private respondent merely draws a
monthly salary of ₱20,000.00 from one corporation only, the Negros Rotadrill Corporation.
Household expenses amounting to not less than ₱200,000.00 a month are paid for by private
respondent through the use of credit cards, which, in turn, are paid by the same corporation
together with the bills for utilities.15
On the other hand, petitioner receives a monthly salary of ₱60,000.00 from Negros Rotadrill
Corporation, and enjoys unlimited cash advances and other benefits in hundreds of thousands of
pesos from the corporations.16 After private respondent confronted him about the affair, petitioner
forbade her to hold office at JBTC Building, Mandalagan, where all the businesses of the
corporations are conducted, thereby depriving her of access to full information about said
businesses. Until the filing of the petition a quo, petitioner has not given private respondent an
accounting of the businesses the value of which she had helped raise to millions of pesos. 17
Action of the RTC of Bacolod City
Finding reasonable ground to believe that an imminent danger of violence against the private
respondent and her children exists or is about to recur, the RTC issued a TPO 18 on March 24,
2006 effective for thirty (30) days, which is quoted hereunder:
Respondent (petitioner herein), Jesus Chua Garcia, is hereby:
a) Ordered to remove all his personal belongings from the conjugal dwelling or family
home within 24 hours from receipt of the Temporary Restraining Order and if he refuses,
ordering that he be removed by police officers from the conjugal dwelling; this order is
enforceable notwithstanding that the house is under the name of 236 Realty Holdings Inc.
(Republic Act No. 9262 states "regardless of ownership"), this is to allow the Petitioner
(private respondent herein) to enter the conjugal dwelling without any danger from the
Respondent.
After the Respondent leaves or is removed from the conjugal dwelling, or anytime the
Petitioner decides to return to the conjugal dwelling to remove things, the Petitioner shall
be assisted by police officers when re-entering the family home.
The Chief of Police shall also give the Petitioner police assistance on Sunday, 26 March
2006 because of the danger that the Respondent will attempt to take her children from
her when he arrives from Manila and finds out about this suit.
b) To stay away from the petitioner and her children, mother and all her household help
and driver from a distance of 1,000 meters, and shall not enter the gate of the subdivision
where the Petitioner may be temporarily residing.
c) Not to harass, annoy, telephone, contact or otherwise communicate with the Petitioner,
directly or indirectly, or through other persons, or contact directly or indirectly her children,
mother and household help, nor send gifts, cards, flowers, letters and the like. Visitation
rights to the children may be subject of a modified TPO in the future.
d) To surrender all his firearms including a .9MM caliber firearm and a Walther PPK and
ordering the Philippine National Police Firearms and Explosives Unit and the Provincial
Director of the PNP to cancel all the Respondent's firearm licenses. He should also be
ordered to surrender any unlicensed firearms in his possession or control.
e) To pay full financial support for the Petitioner and the children, including rental of a
house for them, and educational and medical expenses.
f) Not to dissipate the conjugal business.
g) To render an accounting of all advances, benefits, bonuses and other cash he received
from all the corporations from 1 January 2006 up to 31 March 2006, which himself and as
President of the corporations and his Comptroller, must submit to the Court not later than
2 April 2006. Thereafter, an accounting of all these funds shall be reported to the court by
the Comptroller, copy furnished to the Petitioner, every 15 days of the month, under pain
of Indirect Contempt of Court.
h) To ensure compliance especially with the order granting support pendente lite, and
considering the financial resources of the Respondent and his threat that if the Petitioner
sues she will not get a single centavo, the Respondent is ordered to put up a BOND TO
KEEP THE PEACE in the amount of FIVE MILLION PESOS, in two sufficient sureties.
On April 24, 2006, upon motion19 of private respondent, the trial court issued an amended
TPO,20 effective for thirty (30) days, which included the following additional provisions:
i) The petitioners (private respondents herein) are given the continued use of the Nissan
Patrol and the Starex Van which they are using in Negros Occidental.
 j) The petitioners are given the continued use and occupation of the house in Parañaque,
the continued use of the Starex van in Metro Manila, whenever they go to Manila.
k) Respondent is ordered to immediately post a bond to keep the peace, in two sufficient
sureties.
l) To give monthly support to the petitioner provisionally fixed in the sum of One Hundred
Fifty Thousand Pesos (Php 150,000.00) per month plus rental expenses of Fifty
Thousand Pesos (Php 50,000.00) per month until the matter of support could be finally
resolved.
Two days later, or on April 26, 2006, petitioner filed an Opposition to the Urgent Ex-Parte Motion
for Renewal of the TPO21 seeking the denial of the renewal of the TPO on the grounds that it did
not (1) comply with the three-day notice rule, and (2) contain a notice of hearing. He further asked
that the TPO be modified by (1) removing one vehicle used by private respondent and returning
the same to its rightful owner, the J-Bros Trading Corporation, and (2) cancelling or reducing the
amount of the bond from ₱5,000,000.00 to a more manageable level at ₱100,000.00.
Subsequently, on May 23, 2006, petitioner moved22 for the modification of the TPO to allow him
visitation rights to his children.
On May 24, 2006, the TPO was renewed and extended yet again, but subject only to the following
modifications prayed for by private respondent:
a) That respondent (petitioner herein) return the clothes and other personal belongings of
Rosalie and her children to Judge Jesus Ramos, co-counsel for Petitioner, within 24
hours from receipt of the Temporary Protection Order by his counsel, otherwise be
declared in Indirect Contempt of Court;
b) Respondent shall make an accounting or list of furniture and equipment in the conjugal
house in Pitimini St., Capitolville Subdivision, Bacolod City within 24 hours from receipt of
the Temporary Protection Order by his counsel;
c) Ordering the Chief of the Women's Desk of the Bacolod City Police Headquarters to
remove Respondent from the conjugal dwelling within eight (8) hours from receipt of the
Temporary Protection Order by his counsel, and that he cannot return until 48 hours after
the petitioners have left, so that the petitioner Rosalie and her representatives can
remove things from the conjugal home and make an inventory of the household furniture,
equipment and other things in the conjugal home, which shall be submitted to the Court.
d) Deliver full financial support of Php200,000.00 and Php50,000.00 for rental and
Php25,000.00 for clothes of the three petitioners (sic) children within 24 hours from
receipt of the Temporary Protection Order by his counsel, otherwise be declared in
indirect contempt of Court;
e) That respondent surrender his two firearms and all unlicensed firearms to the Clerk of
Court within 24 hours from receipt of the Temporary Protection Order by his counsel;
f) That respondent shall pay petitioner educational expenses of the children upon
presentation of proof of payment of such expenses.23
Claiming that petitioner continued to deprive them of financial support; failed to faithfully comply
with the TPO; and committed new acts of harassment against her and their children, private
respondent filed another application24 for the issuance of a TPO ex parte. She alleged inter
alia that petitioner contrived a replevin suit against himself by J-Bros Trading, Inc., of which the
latter was purportedly no longer president, with the end in view of recovering the Nissan Patrol
and Starex Van used by private respondent and the children. A writ of replevin was served upon
private respondent by a group of six or seven policemen with long firearms that scared the two
small boys, Jessie Anthone and Joseph Eduard.25
While Joseph Eduard, then three years old, was driven to school, two men allegedly attempted to
kidnap him, which incident traumatized the boy resulting in his refusal to go back to school. On
another occasion, petitioner allegedly grabbed their daughter, Jo-Ann, by the arm and threatened
her.26 The incident was reported to the police, and Jo-Ann subsequently filed a criminal complaint
against her father for violation of R.A. 7610, also known as the "Special Protection of Children
Against Child Abuse, Exploitation and Discrimination Act."
Aside from the replevin suit, petitioner's lawyers initiated the filing by the housemaids working at
the conjugal home of a complaint for kidnapping and illegal detention against private respondent.
This came about after private respondent, armed with a TPO, went to said home to get her and
her children's belongings. Finding some of her things inside a housemaid's (Sheryl Jamola) bag in
the maids' room, private respondent filed a case for qualified theft against Jamola.27
On August 23, 2006, the RTC issued a TPO,28 effective for thirty (30) days, which reads as
follows:
Respondent (petitioner herein), Jesus Chua Garcia, is hereby:
1) Prohibited from threatening to commit or committing, personally or through another,
acts of violence against the offended party;
2) Prohibited from harassing, annoying, telephoning, contacting or otherwise
communicating in any form with the offended party, either directly or indirectly;
3) Required to stay away, personally or through his friends, relatives, employees or
agents, from all the Petitioners Rosalie J. Garcia and her children, Rosalie J. Garcia's
three brothers, her mother Primitiva Jaype, cook Novelita Caranzo, driver Romeo
Hontiveros, laundrywoman Mercedita Bornales, security guard Darwin Gayona and the
petitioner's other household helpers from a distance of 1,000 meters, and shall not enter
the gate of the subdivision where the Petitioners are temporarily residing, as well as from
 the schools of the three children; Furthermore, that respondent shall not contact the
schools of the children directly or indirectly in any manner including, ostensibly to pay for
their tuition or other fees directly, otherwise he will have access to the children through
the schools and the TPO will be rendered nugatory;
4) Directed to surrender all his firearms including .9MM caliber firearm and a Walther PPK
to the Court;
5) Directed to deliver in full financial support of Php200,000.00 a month and
Php50,000.00 for rental for the period from August 6 to September 6, 2006; and support
in arrears from March 2006 to August 2006 the total amount of Php1,312,000.00;
6) Directed to deliver educational expenses for 2006-2007 the amount of Php75,000.00
and Php25,000.00;
7) Directed to allow the continued use of a Nissan Patrol with Plate No. FEW 508 and a
Starex van with Plate No. FFD 991 and should the respondent fail to deliver said vehicles,
respondent is ordered to provide the petitioner another vehicle which is the one taken by
J Bros Tading;
8) Ordered not to dissipate, encumber, alienate, sell, lease or otherwise dispose of the
conjugal assets, or those real properties in the name of Jesus Chua Garcia only and
those in which the conjugal partnership of gains of the Petitioner Rosalie J. Garcia and
respondent have an interest in, especially the conjugal home located in No. 14, Pitimini
St., Capitolville Subdivision, Bacolod City, and other properties which are conjugal assets
or those in which the conjugal partnership of gains of Petitioner Rosalie J. Garcia and the
respondent have an interest in and listed in Annexes "I," "I-1," and "I-2," including
properties covered by TCT Nos. T-186325 and T-168814;
9) Ordered that the Register of Deeds of Bacolod City and E.B. Magalona shall be served
a copy of this TEMPORARY PROTECTION ORDER and are ordered not to allow the
transfer, sale, encumbrance or disposition of these above-cited properties to any person,
entity or corporation without the personal presence of petitioner Rosalie J. Garcia, who
shall affix her signature in the presence of the Register of Deeds, due to the fear of
petitioner Rosalie that her signature will be forged in order to effect the encumbrance or
sale of these properties to defraud her or the conjugal partnership of gains.
In its Order29 dated September 26, 2006, the trial court extended the aforequoted TPO for another
ten (10) days, and gave petitioner a period of five (5) days within which to show cause why the
TPO should not be renewed, extended, or modified. Upon petitioner's manifestation, 30 however,
that he has not received a copy of private respondent's motion to modify/renew the TPO, the trial
court directed in its Order31 dated October 6, 2006 that petitioner be furnished a copy of said
motion. Nonetheless, an Order32 dated a day earlier, October 5, had already been issued
renewing the TPO dated August 23, 2006. The pertinent portion is quoted hereunder:
xxxx
x x x it appearing further that the hearing could not yet be finally terminated, the Temporary
Protection Order issued on August 23, 2006 is hereby renewed and extended for thirty (30) days
and continuously extended and renewed for thirty (30) days, after each expiration, until further
orders, and subject to such modifications as may be ordered by the court.
After having received a copy of the foregoing Order, petitioner no longer submitted the required
comment to private respondent's motion for renewal of the TPO arguing that it would only be an
"exercise in futility."33
Proceedings before the CA
During the pendency of Civil Case No. 06-797, petitioner filed before the Court of Appeals (CA) a
petition34 for prohibition (CA-G.R. CEB-SP. No. 01698), with prayer for injunction and temporary
restraining order, challenging (1) the constitutionality of R.A. 9262 for being violative of the due
process and the equal protection clauses, and (2) the validity of the modified TPO issued in the
civil case for being "an unwanted product of an invalid law."
On May 26, 2006, the appellate court issued a 60-day Temporary Restraining Order36 (TRO)
against the enforcement of the TPO, the amended TPOs and other orders pursuant thereto.
Subsequently, however, on January 24, 2007, the appellate court dismissed 36 the petition for
failure of petitioner to raise the constitutional issue in his pleadings before the trial court in the civil
case, which is clothed with jurisdiction to resolve the same. Secondly, the challenge to the validity
of R.A. 9262 through a petition for prohibition seeking to annul the protection orders issued by the
trial court constituted a collateral attack on said law.
His motion for reconsideration of the foregoing Decision having been denied in the
Resolution37 dated August 14, 2007, petitioner is now before us alleging that –
The Issues
I.
THE COURT OF APPEALS ERRED IN DISMISSING THE PETITION ON THE THEORY THAT
THE ISSUE OF CONSTITUTIONALITY WAS NOT RAISED AT THE EARLIEST OPPORTUNITY
AND THAT, THE PETITION CONSTITUTES A COLLATERAL ATTACK ON THE VALIDITY OF
THE LAW.
II.
THE COURT OF APPEALS COMMITTED SERIOUS ERROR IN FAILING TO CONCLUDE THAT
R.A. 9262 IS DISCRIMINATORY, UNJUST, AND VIOLATIVE OF THE EQUAL PROTECTION
CLAUSE.
III.
THE COURT OF APPEALS COMMITTED GRAVE MISTAKE IN NOT FINDING THAT R.A. 9262
RUNS COUNTER TO THE DUE PROCESS CLAUSE OF THE CONSTITUTION.
IV.
THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE LAW DOES VIOLENCE TO
THE POLICY OF THE STATE TO PROTECT THE FAMILY AS A BASIC SOCIAL INSTITUTION.
V.
THE COURT OF APPEALS SERIOUSLY ERRED IN NOT DECLARING R.A. No. 9262 AS
INVALID AND UNCONSTITUTIONAL BECAUSE IT ALLOWS AN UNDUE DELEGATION OF
JUDICIAL POWER TO THE BARANGAY OFFICIALS.38
The Ruling of the Court
Before delving into the arguments propounded by petitioner against the constitutionality of R.A.
9262, we shall first tackle the propriety of the dismissal by the appellate court of the petition for
prohibition (CA-G.R. CEB-SP. No. 01698) filed by petitioner.
As a general rule, the question of constitutionality must be raised at the earliest opportunity so that
if not raised in the pleadings, ordinarily it may not be raised in the trial, and if not raised in the trial
court, it will not be considered on appeal.39 Courts will not anticipate a question of constitutional
law in advance of the necessity of deciding it.40
In defending his failure to attack the constitutionality of R.A. 9262 before the RTC of Bacolod City,
petitioner argues that the Family Court has limited authority and jurisdiction that is "inadequate to
tackle the complex issue of constitutionality."41
We disagree.
Family Courts have authority and jurisdiction to consider the constitutionality of a statute.
At the outset, it must be stressed that Family Courts are special courts, of the same level as
Regional Trial Courts. Under R.A. 8369, otherwise known as the "Family Courts Act of 1997,"
family courts have exclusive original jurisdiction to hear and decide cases of domestic violence
against women and children.42 In accordance with said law, the Supreme Court designated from
among the branches of the Regional Trial Courts at least one Family Court in each of several key
cities identified.43 To achieve harmony with the first mentioned law, Section 7 of R.A. 9262 now
provides that Regional Trial Courts designated as Family Courts shall have original and exclusive
jurisdiction over cases of VAWC defined under the latter law, viz:
SEC. 7. Venue. – The Regional Trial Court designated as a Family Court shall have original and
exclusive jurisdiction over cases of violence against women and their children under this law. In
the absence of such court in the place where the offense was committed, the case shall be filed in
the Regional Trial Court where the crime or any of its elements was committed at the option of the
complainant. (Emphasis supplied)
Inspite of its designation as a family court, the RTC of Bacolod City remains possessed of
authority as a court of general original jurisdiction to pass upon all kinds of cases whether civil,
criminal, special proceedings, land registration, guardianship, naturalization, admiralty or
insolvency.44 It is settled that RTCs have jurisdiction to resolve the constitutionality of a
statute,45 "this authority being embraced in the general definition of the judicial power to determine
what are the valid and binding laws by the criterion of their conformity to the fundamental
law."46The Constitution vests the power of judicial review or the power to declare the
constitutionality or validity of a law, treaty, international or executive agreement, presidential
decree, order, instruction, ordinance, or regulation not only in this Court, but in all RTCs. 47 We said
in J.M. Tuason and Co., Inc. v. CA48 that, "plainly the Constitution contemplates that the inferior
courts should have jurisdiction in cases involving constitutionality of any treaty or law, for it speaks
of appellate review of final judgments of inferior courts in cases where such constitutionality
happens to be in issue." Section 5, Article VIII of the 1987 Constitution reads in part as follows:
SEC. 5. The Supreme Court shall have the following powers:
xxx
2. Review, revise, reverse, modify, or affirm on appeal or certiorari, as the law or the Rules of
Court may provide, final judgments and orders of lower courts in:
a. All cases in which the constitutionality or validity of any treaty, international or executive
agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in
question.
xxxx
Thus, contrary to the posturing of petitioner, the issue of constitutionality of R.A. 9262 could have
been raised at the earliest opportunity in his Opposition to the petition for protection order before
the RTC of Bacolod City, which had jurisdiction to determine the same, subject to the review of
this Court.
Section 20 of A.M. No. 04-10-11-SC, the Rule on Violence Against Women and Their Children,
lays down a new kind of procedure requiring the respondent to file an opposition to the petition
and not an answer.49 Thus:
SEC. 20. Opposition to petition. – (a) The respondent may file an opposition to the petition which
he himself shall verify. It must be accompanied by the affidavits of witnesses and shall show cause
why a temporary or permanent protection order should not be issued.
(b) Respondent shall not include in the opposition any counterclaim, cross-claim or third-party
complaint, but any cause of action which could be the subject thereof may be litigated in a
separate civil action. (Emphasis supplied)
We cannot subscribe to the theory espoused by petitioner that, since a counterclaim, cross-claim
and third-party complaint are to be excluded from the opposition, the issue of constitutionality
cannot likewise be raised therein. A counterclaim is defined as any claim for money or other relief
which a defending party may have against an opposing party.50 A cross-claim, on the other hand,
is any claim by one party against a co-party arising out of the transaction or occurrence that is the
subject matter either of the original action or of a counterclaim therein. 51Finally, a third-party
complaint is a claim that a defending party may, with leave of court, file against a person not a
party to the action for contribution, indemnity, subrogation or any other relief, in respect of his
opponent's claim.52As pointed out by Justice Teresita J. Leonardo-De Castro, the
unconstitutionality of a statute is not a cause of action that could be the subject of a counterclaim,
cross-claim or a third-party complaint. Therefore, it is not prohibited from being raised in the
opposition in view of the familiar maxim expressio unius est exclusio alterius.
Moreover, it cannot be denied that this issue affects the resolution of the case a quo because the
right of private respondent to a protection order is founded solely on the very statute the validity of
which is being attacked53 by petitioner who has sustained, or will sustain, direct injury as a result of
its enforcement. The alleged unconstitutionality of R.A. 9262 is, for all intents and purposes, a
valid cause for the non-issuance of a protection order.
That the proceedings in Civil Case No. 06-797 are summary in nature should not have deterred
petitioner from raising the same in his Opposition. The question relative to the constitutionality of a
statute is one of law which does not need to be supported by evidence.54 Be that as it may,
Section 25 of A.M. No. 04-10-11-SC nonetheless allows the conduct of a hearing to determine
legal issues, among others, viz:
SEC. 25. Order for further hearing. - In case the court determines the need for further hearing, it
may issue an order containing the following:
(a) Facts undisputed and admitted;
(b) Factual and legal issues to be resolved;
(c) Evidence, including objects and documents that have been marked and will be
presented;
(d) Names of witnesses who will be ordered to present their direct testimonies in the form
of affidavits; and
(e) Schedule of the presentation of evidence by both parties which shall be done in one
day, to the extent possible, within the 30-day period of the effectivity of the temporary
protection order issued. (Emphasis supplied)
To obviate potential dangers that may arise concomitant to the conduct of a hearing when
necessary, Section 26 (b) of A.M. No. 04-10-11-SC provides that if a temporary protection order
issued is due to expire, the trial court may extend or renew the said order for a period of thirty (30)
days each time until final judgment is rendered. It may likewise modify the extended or renewed
temporary protection order as may be necessary to meet the needs of the parties. With the private
respondent given ample protection, petitioner could proceed to litigate the constitutional issues,
without necessarily running afoul of the very purpose for the adoption of the rules on summary
procedure.
In view of all the foregoing, the appellate court correctly dismissed the petition for prohibition with
prayer for injunction and temporary restraining order (CA-G.R. CEB - SP. No. 01698). Petitioner
may have proceeded upon an honest belief that if he finds succor in a superior court, he could be
granted an injunctive relief. However, Section 22(j) of A.M. No. 04-10-11-SC expressly disallows
the filing of a petition for certiorari, mandamus or prohibition against any interlocutory order issued
by the trial court. Hence, the 60-day TRO issued by the appellate court in this case against the
enforcement of the TPO, the amended TPOs and other orders pursuant thereto was improper,
and it effectively hindered the case from taking its normal course in an expeditious and summary
manner.
As the rules stand, a review of the case by appeal or certiorari before judgment is prohibited.
Moreover, if the appeal of a judgment granting permanent protection shall not stay its
enforcement,55 with more reason that a TPO, which is valid only for thirty (30) days at a
time,56 should not be enjoined.
The mere fact that a statute is alleged to be unconstitutional or invalid, does not of itself entitle a
litigant to have the same enjoined.57 In Younger v. Harris, Jr.,58 the Supreme Court of the United
States declared, thus:
Federal injunctions against state criminal statutes, either in their entirety or with respect to their
separate and distinct prohibitions, are not to be granted as a matter of course, even if such
statutes are unconstitutional. No citizen or member of the community is immune from prosecution,
in good faith, for his alleged criminal acts. The imminence of such a prosecution even though
alleged to be unauthorized and, hence, unlawful is not alone ground for relief in equity which
exerts its extraordinary powers only to prevent irreparable injury to the plaintiff who seeks its aid.
(Citations omitted)
The sole objective of injunctions is to preserve the status quo until the trial court hears fully the
merits of the case. It bears stressing, however, that protection orders are granted ex parte so as to
protect women and their children from acts of violence. To issue an injunction against such orders
will defeat the very purpose of the law against VAWC.
Notwithstanding all these procedural flaws, we shall not shirk from our obligation to determine
novel issues, or issues of first impression, with far-reaching implications. We have, time and again,
discharged our solemn duty as final arbiter of constitutional issues, and with more reason now, in
view of private respondent's plea in her Comment59 to the instant Petition that we should put the
challenge to the constitutionality of R.A. 9262 to rest. And so we shall.
Intent of Congress in enacting R.A. 9262.
Petitioner claims that since R.A. 9262 is intended to prevent and criminalize spousal and child
abuse, which could very well be committed by either the husband or the wife, gender alone is not
enough basis to deprive the husband/father of the remedies under the law.60
A perusal of the deliberations of Congress on Senate Bill No. 2723,61 which became R.A. 9262,
reveals that while the sponsor, Senator Luisa Pimentel-Ejercito (better known as Senator Loi
Estrada), had originally proposed what she called a "synthesized measure"62 – an amalgamation
of two measures, namely, the "Anti-Domestic Violence Act" and the "Anti-Abuse of Women in
Intimate Relationships Act"63 – providing protection to "all family members, leaving no one in
isolation" but at the same time giving special attention to women as the "usual victims" of violence
and abuse,64 nonetheless, it was eventually agreed that men be denied protection under the same
measure. We quote pertinent portions of the deliberations:
Wednesday, December 10, 2003
Senator Pangilinan. I just wanted to place this on record, Mr. President. Some women's groups
have expressed concerns and relayed these concerns to me that if we are to include domestic
violence apart from against women as well as other members of the household, including children
or the husband, they fear that this would weaken the efforts to address domestic violence of which
the main victims or the bulk of the victims really are the wives, the spouses or the female partners
in a relationship. We would like to place that on record. How does the good Senator respond to
this kind of observation?
Senator Estrada. Yes, Mr. President, there is this group of women who call themselves "WIIR"
Women in Intimate Relationship. They do not want to include men in this domestic violence. But
plenty of men are also being abused by women. I am playing safe so I placed here members of
the family, prescribing penalties therefor and providing protective measures for victims. This
includes the men, children, live-in, common-law wives, and those related with the family.65
xxx
Wednesday, January 14, 2004
xxxx
The President Pro Tempore. x x x
Also, may the Chair remind the group that there was the discussion whether to limit this to women
and not to families which was the issue of the AWIR group. The understanding that I have is that
we would be having a broader scope rather than just women, if I remember correctly, Madam
sponsor.
Senator Estrada. Yes, Mr. President.
As a matter of fact, that was brought up by Senator Pangilinan during the interpellation period.
I think Senator Sotto has something to say to that.
Senator Legarda. Mr. President, the reason I am in support of the measure. Do not get me wrong.
However, I believe that there is a need to protect women's rights especially in the domestic
environment.
As I said earlier, there are nameless, countless, voiceless women who have not had the
opportunity to file a case against their spouses, their live-in partners after years, if not decade, of
battery and abuse. If we broaden the scope to include even the men, assuming they can at all be
abused by the women or their spouses, then it would not equalize the already difficult situation for
women, Mr. President.
I think that the sponsor, based on our earlier conversations, concurs with this position. I am sure
that the men in this Chamber who love their women in their lives so dearly will agree with this
representation. Whether we like it or not, it is an unequal world. Whether we like it or not, no
matter how empowered the women are, we are not given equal opportunities especially in the
domestic environment where the macho Filipino man would always feel that he is stronger, more
superior to the Filipino woman.
xxxx
The President Pro Tempore. What does the sponsor say?
Senator Estrada. Mr. President, before accepting this, the committee came up with this bill
because the family members have been included in this proposed measure since the other
members of the family other than women are also possible victims of violence. While women are
most likely the intended victims, one reason incidentally why the measure focuses on women, the
fact remains that in some relatively few cases, men also stand to be victimized and that children
are almost always the helpless victims of violence. I am worried that there may not be enough
protection extended to other family members particularly children who are excluded. Although
Republic Act No. 7610, for instance, more or less, addresses the special needs of abused
children. The same law is inadequate. Protection orders for one are not available in said law.
I am aware that some groups are apprehensive about granting the same protection to men,
fearing that they may use this law to justify their abusive behavior against women. However, we
should also recognize that there are established procedures and standards in our courts which
give credence to evidentiary support and cannot just arbitrarily and whimsically entertain baseless
complaints.
Mr. President, this measure is intended to harmonize family relations and to protect the family as
the basic social institution. Though I recognize the unequal power relations between men and
women in our society, I believe we have an obligation to uphold inherent rights and dignity of both
husband and wife and their immediate family members, particularly children.
While I prefer to focus mainly on women, I was compelled to include other family members as a
critical input arrived at after a series of consultations/meetings with various NGOs, experts, sports
groups and other affected sectors, Mr. President.
Senator Sotto. Mr. President.
The President Pro Tempore. Yes, with the permission of the other senators.
Senator Sotto. Yes, with the permission of the two ladies on the Floor.
The President Pro Tempore. Yes, Sen. Vicente C. Sotto III is recognized.
Senator Sotto. I presume that the effect of the proposed amendment of Senator Legarda would be
removing the "men and children" in this particular bill and focus specifically on women alone. That
will be the net effect of that proposed amendment. Hearing the rationale mentioned by the
distinguished sponsor, Sen. Luisa "Loi" Ejercito Estrada, I am not sure now whether she is inclined
to accept the proposed amendment of Senator Legarda.
I am willing to wait whether she is accepting this or not because if she is going to accept this, I will
propose an amendment to the amendment rather than object to the amendment, Mr. President.
xxxx
Senator Estrada. The amendment is accepted, Mr. President.
The President Pro Tempore. Is there any objection?
xxxx
Senator Sotto. x x x May I propose an amendment to the amendment.
The President Pro Tempore. Before we act on the amendment?
Senator Sotto. Yes, Mr. President.
The President Pro Tempore. Yes, please proceed.
Senator Sotto. Mr. President, I am inclined to believe the rationale used by the distinguished
proponent of the amendment. As a matter of fact, I tend to agree. Kung may maaabuso, mas
malamang iyong babae kaysa sa lalake. At saka iyong mga lalake, puwede na talagang magulpi
iyan. Okey lang iyan. But I cannot agree that we remove the children from this particular measure.
So, if I may propose an amendment –
The President Pro Tempore. To the amendment.
Senator Sotto. – more than the women, the children are very much abused. As a matter of fact, it
is not limited to minors. The abuse is not limited to seven, six, 5-year-old children. I have seen 14,
15-year-old children being abused by their fathers, even by their mothers. And it breaks my heart
to find out about these things.
Because of the inadequate existing law on abuse of children, this particular measure will update
that. It will enhance and hopefully prevent the abuse of children and not only women.
SOTTO-LEGARDA AMENDMENTS
Therefore, may I propose an amendment that, yes, we remove the aspect of the men in the bill but
not the children.
Senator Legarda. I agree, Mr. President, with the Minority Leader.
The President Pro Tempore. Effectively then, it will be women AND CHILDREN.
Senator Sotto. Yes, Mr. President.
Senator Estrada. It is accepted, Mr. President.
The President Pro Tempore. Is there any objection? [Silence] There being none, the amendment,
as amended, is approved.66
It is settled that courts are not concerned with the wisdom, justice, policy, or expediency of a
statute.67 Hence, we dare not venture into the real motivations and wisdom of the members of
Congress in limiting the protection against violence and abuse under R.A. 9262 to women and
children only. No proper challenge on said grounds may be entertained in this proceeding.
Congress has made its choice and it is not our prerogative to supplant this judgment. The choice
may be perceived as erroneous but even then, the remedy against it is to seek its amendment or
repeal by the legislative. By the principle of separation of powers, it is the legislative that
determines the necessity, adequacy, wisdom and expediency of any law. 68 We only step in when
there is a violation of the Constitution. However, none was sufficiently shown in this case.
R.A. 9262 does not violate the guaranty of equal protection of the laws.
Equal protection simply requires that all persons or things similarly situated should be treated
alike, both as to rights conferred and responsibilities imposed. The oft-repeated disquisition in the
early case of Victoriano v. Elizalde Rope Workers' Union69 is instructive:
The guaranty of equal protection of the laws is not a guaranty of equality in the application of the
laws upon all citizens of the state. It is not, therefore, a requirement, in order to avoid the
constitutional prohibition against inequality, that every man, woman and child should be affected
alike by a statute. Equality of operation of statutes does not mean indiscriminate operation on
persons merely as such, but on persons according to the circumstances surrounding them. It
guarantees equality, not identity of rights. The Constitution does not require that things which are
different in fact be treated in law as though they were the same. The equal protection clause does
not forbid discrimination as to things that are different. It does not prohibit legislation which is
limited either in the object to which it is directed or by the territory within which it is to operate.
The equal protection of the laws clause of the Constitution allows classification. Classification in
law, as in the other departments of knowledge or practice, is the grouping of things in speculation
or practice because they agree with one another in certain particulars. A law is not invalid because
of simple inequality. The very idea of classification is that of inequality, so that it goes without
saying that the mere fact of inequality in no manner determines the matter of constitutionality. All
that is required of a valid classification is that it be reasonable, which means that the classification
should be based on substantial distinctions which make for real differences; that it must be
germane to the purpose of the law; that it must not be limited to existing conditions only; and that it
must apply equally to each member of the class. This Court has held that the standard is satisfied
if the classification or distinction is based on a reasonable foundation or rational basis and is not
palpably arbitrary. (Emphasis supplied)
Measured against the foregoing jurisprudential yardstick, we find that R.A. 9262 is based on a
valid classification as shall hereinafter be discussed and, as such, did not violate the equal
protection clause by favoring women over men as victims of violence and abuse to whom the
State extends its protection.
I. R.A. 9262 rests on substantial distinctions.
The unequal power relationship between women and men; the fact that women are more likely
than men to be victims of violence; and the widespread gender bias and prejudice against women
all make for real differences justifying the classification under the law. As Justice McIntyre
succinctly states, "the accommodation of differences ... is the essence of true equality."70
A. Unequal power relationship between men and women
According to the Philippine Commission on Women (the National Machinery for Gender Equality
and Women's Empowerment), violence against women (VAW) is deemed to be closely linked with
the unequal power relationship between women and men otherwise known as "gender-based
violence". Societal norms and traditions dictate people to think men are the leaders, pursuers,
providers, and take on dominant roles in society while women are nurturers, men's companions
and supporters, and take on subordinate roles in society. This perception leads to men gaining
more power over women. With power comes the need to control to retain that power. And VAW is
a form of men's expression of controlling women to retain power.71
women is one of the crucial social mechanisms by which women are forced into subordinate
positions, compared with men."72
Then Chief Justice Reynato S. Puno traced the historical and social context of gender-based
violence and developments in advocacies to eradicate VAW, in his remarks delivered during the
Joint Launching of R.A. 9262 and its Implementing Rules last October 27, 2004, the pertinent
portions of which are quoted hereunder:
History reveals that most societies sanctioned the use of violence against women. The patriarch of
a family was accorded the right to use force on members of the family under his control. I quote
the early studies:
Traditions subordinating women have a long history rooted in patriarchy – the institutional rule of
men. Women were seen in virtually all societies to be naturally inferior both physically and
intellectually. In ancient Western societies, women whether slave, concubine or wife, were under
the authority of men. In law, they were treated as property.
The Roman concept of patria potestas allowed the husband to beat, or even kill, his wife if she
endangered his property right over her. Judaism, Christianity and other religions oriented towards
the patriarchal family strengthened the male dominated structure of society.
English feudal law reinforced the tradition of male control over women. Even the eminent
Blackstone has been quoted in his commentaries as saying husband and wife were one and that
one was the husband. However, in the late 1500s and through the entire 1600s, English common
law began to limit the right of husbands to chastise their wives. Thus, common law developed the
rule of thumb, which allowed husbands to beat their wives with a rod or stick no thicker than their
thumb.
In the later part of the 19th century, legal recognition of these rights to chastise wives or inflict
corporeal punishment ceased. Even then, the preservation of the family was given more
importance than preventing violence to women.
The metamorphosis of the law on violence in the United States followed that of the English
common law. In 1871, the Supreme Court of Alabama became the first appellate court to strike
down the common law right of a husband to beat his wife:
The privilege, ancient though it may be, to beat one's wife with a stick, to pull her hair, choke her,
spit in her face or kick her about the floor, or to inflict upon her like indignities, is not now
acknowledged by our law... In person, the wife is entitled to the same protection of the law that the
husband can invoke for himself.

As time marched on, the women's advocacy movement became more organized. The temperance
The United Nations, which has long recognized VAW as a human rights issue, passed its
leagues initiated it. These leagues had a simple focus. They considered the evils of alcoholism as
Resolution 48/104 on the Declaration on Elimination of Violence Against Women on December 20,
the root cause of wife abuse. Hence, they demonstrated and picketed saloons, bars and their
1993 stating that "violence against women is a manifestation of historically unequal power
husbands' other watering holes. Soon, however, their crusade was joined by suffragette
relations between men and women, which have led to domination over and discrimination against
women by men and to the prevention of the full advancement of women, and that violence against
movements, expanding the liberation movement's agenda. They fought for women's right to vote,
to own property, and more. Since then, the feminist movement was on the roll.
The feminist movement exposed the private invisibility of the domestic violence to the public gaze.
They succeeded in transforming the issue into an important public concern. No less than the
United States Supreme Court, in 1992 case Planned Parenthood v. Casey, noted:
In an average 12-month period in this country, approximately two million women are the victims of
severe assaults by their male partners. In a 1985 survey, women reported that nearly one of every
eight husbands had assaulted their wives during the past year. The [American Medical
Association] views these figures as "marked underestimates," because the nature of these
incidents discourages women from reporting them, and because surveys typically exclude the very
poor, those who do not speak English well, and women who are homeless or in institutions or
hospitals when the survey is conducted. According to the AMA, "researchers on family violence
agree that the true incidence of partner violence is probably double the above estimates; or four
million severely assaulted women per year."
Studies on prevalence suggest that from one-fifth to one-third of all women will be physically
assaulted by a partner or ex-partner during their lifetime... Thus on an average day in the United
States, nearly 11,000 women are severely assaulted by their male partners. Many of these
incidents involve sexual assault... In families where wife beating takes place, moreover, child
abuse is often present as well.
law of women and men. Our Senate has ratified the CEDAW as well as the Convention on the
Rights of the Child and its two protocols. To cap it all, Congress, on March 8, 2004, enacted Rep.
Act No. 9262, entitled "An Act Defining Violence Against Women and Their Children, Providing for
Protective Measures for Victims, Prescribing Penalties therefor and for other Purposes." (Citations
omitted)
B. Women are the "usual" and "most likely"
victims of violence.
At the time of the presentation of Senate Bill No. 2723, official statistics on violence against
women and children show that –
x x x physical injuries had the highest number of cases at 5,058 in 2002 representing 55.63% of
total cases reported (9,903). And for the first semester of 2003, there were 2,381 reported cases
out of 4,354 cases which represent 54.31%. xxx (T)he total number of women in especially difficult
circumstances served by the Department of Social Welfare and Development (DSWD) for the year
2002, there are 1,417 physically abused/maltreated cases out of the total of 5,608 cases. xxx
(T)here are 1,091 DSWD cases out of a total number of 3,471 cases for the first semester of 2003.
Female violence comprised more than 90% of all forms of abuse and violence and more than 90%
of these reported cases were committed by the women's intimate partners such as their husbands
and live-in partners.73

Other studies fill in the rest of this troubling picture. Physical violence is only the most visible form Recently, the Philippine Commission on Women presented comparative statistics on violence
of abuse. Psychological abuse, particularly forced social and economic isolation of women, is also against women across an eight-year period from 2004 to August of 2011 with violations under
common. R.A. 9262 ranking first among the different VAW categories since its implementation in
2004,74 thus:
Many victims of domestic violence remain with their abusers, perhaps because they perceive no
superior alternative...Many abused women who find temporary refuge in shelters return to their Table 1. Annual Comparative Statistics on Violence Against Women, 2004 - 2011*
husbands, in large part because they have no other source of income... Returning to one's abuser
can be dangerous. Recent Federal Bureau of Investigation statistics disclose that 8.8 percent of all
homicide victims in the United States are killed by their spouses...Thirty percent of female
homicide victims are killed by their male partners. Reported 200 200 200 200 200 200
2010 2011
Cases 4 5 6 7 8 9
Finally in 1994, the United States Congress enacted the Violence Against Women Act.
Rape 997 927 659 837 811 770 1,042 832
In the International front, the women's struggle for equality was no less successful. The United
States Charter and the Universal Declaration of Human Rights affirmed the equality of all human
beings. In 1979, the UN General Assembly adopted the landmark Convention on the Elimination
Incestuous
of all Forms of Discrimination Against Women (CEDAW). In 1993, the UN General Assembly also 38 46 26 22 28 27 19 23
Rape
adopted the Declaration on the Elimination of Violence Against Women. World conferences on the
role and rights of women have been regularly held in Mexico City, Copenhagen, Nairobi and
Beijing. The UN itself established a Commission on the Status of Women.
Attempted
194 148 185 147 204 167 268 201
Rape
The Philippines has been in cadence with the half – and full – steps of all these women's
movements. No less than Section 14, Article II of our 1987 Constitution mandates the State to
recognize the role of women in nation building and to ensure the fundamental equality before the
 Source: Philippine National Police – Women and Children Protection Center (WCPC)
Acts of
Lasciviousn 580 536 382 358 445 485 745 625 On the other hand, no reliable estimates may be obtained on domestic abuse and violence against
ess men in the Philippines because incidents thereof are relatively low and, perhaps, because many
men will not even attempt to report the situation. In the United Kingdom, 32% of women who had
ever experienced domestic violence did so four or five (or more) times, compared with 11% of the
Physical 3,55 2,33 1,89 1,50 1,30 1,49 smaller number of men who had ever experienced domestic violence; and women constituted
2,018 1,588
Injuries 3 5 2 5 7 8 89% of all those who had experienced 4 or more incidents of domestic violence.75Statistics in
Canada show that spousal violence by a woman against a man is less likely to cause injury than
the other way around (18 percent versus 44 percent). Men, who experience violence from their
Sexual spouses are much less likely to live in fear of violence at the hands of their spouses, and much
53 37 38 46 18 54 83 63 less likely to experience sexual assault. In fact, many cases of physical violence by a woman
Harassment
against a spouse are in self-defense or the result of many years of physical or emotional abuse.76

1,26 2,38 3,59 5,28 While there are, indeed, relatively few cases of violence and abuse perpetrated against men in the
RA 9262 218 924 9,974 9,021 Philippines, the same cannot render R.A. 9262 invalid.
9 7 9 5

In a 1960 case involving the violation of a city ordinance requiring drivers of animal-drawn vehicles
Threats 319 223 199 182 220 208 374 213 to pick up, gather and deposit in receptacles the manure emitted or discharged by their vehicle-
drawing animals in any public highways, streets, plazas, parks or alleys, said ordinance was
challenged as violative of the guaranty of equal protection of laws as its application is limited to
Seduction 62 19 29 30 19 19 25 15 owners and drivers of vehicle-drawing animals and not to those animals, although not utilized, but
similarly pass through the same streets.

Concubinag The ordinance was upheld as a valid classification for the reason that, while there may be non-
121 102 93 109 109 99 158 128 vehicle-drawing animals that also traverse the city roads, "but their number must be negligible and
e
their appearance therein merely occasional, compared to the rig-drawing ones, as not to constitute
a menace to the health of the community."77 The mere fact that the legislative classification may
RA 9208 17 11 16 24 34 152 190 62 result in actual inequality is not violative of the right to equal protection, for every classification of
persons or things for regulation by law produces inequality in some degree, but the law is not
thereby rendered invalid.78
Abduction
/Kidnapping 16 34 23 28 18 25 22 C. Gender bias and prejudices
29
From the initial report to the police through prosecution, trial, and sentencing, crimes against
women are often treated differently and less seriously than other crimes. This was argued by then
Unjust United States Senator Joseph R. Biden, Jr., now Vice President, chief sponsor of the Violence
90 50 59 59 83 703 183 155 Against Women Act (VAWA), in defending the civil rights remedy as a valid exercise of the U.S.
Vexation
Congress' authority under the Commerce and Equal Protection Clauses. He stressed that the
widespread gender bias in the U.S. has institutionalized historic prejudices against victims of rape
6,27 5,37 4,88 5,72 6,90 9,48 15,10 12,94 or domestic violence, subjecting them to "double victimization" – first at the hands of the offender
Total
1 4 1 9 5 5 4 8 and then of the legal system.79

Our own Senator Loi Estrada lamented in her Sponsorship Speech for Senate Bill No. 2723 that
"(w)henever violence occurs in the family, the police treat it as a private matter and advise the
*2011 report covers only from January to August
parties to settle the conflict themselves. Once the complainant brings the case to the prosecutor,
the latter is hesitant to file the complaint for fear that it might later be withdrawn. This lack of
response or reluctance to be involved by the police and prosecution reinforces the escalating,
recurring and often serious nature of domestic violence."80
Sadly, our own courts, as well, have exhibited prejudices and biases against our women.
In a recent case resolved on March 9, 2011, we fined RTC Judge Venancio J. Amila for Conduct
Unbecoming of a Judge. He used derogatory and irreverent language in reference to the
complainant in a petition for TPO and PPO under R.A. 9262, calling her as "only a live-in partner"
and presenting her as an "opportunist" and a "mistress" in an "illegitimate relationship." Judge
Amila even called her a "prostitute," and accused her of being motivated by "insatiable greed" and
of absconding with the contested property.81 Such remarks betrayed Judge Amila's prejudices and
lack of gender sensitivity.
The enactment of R.A. 9262 aims to address the discrimination brought about by biases and
prejudices against women. As emphasized by the CEDAW Committee on the Elimination of
Discrimination against Women, addressing or correcting discrimination through specific measures
focused on women does not discriminate against men.82Petitioner's contention,83 therefore, that
R.A. 9262 is discriminatory and that it is an "anti-male," "husband-bashing," and "hate-men" law
deserves scant consideration. As a State Party to the CEDAW, the Philippines bound itself to take
all appropriate measures "to modify the social and cultural patterns of conduct of men and women,
with a view to achieving the elimination of prejudices and customary and all other practices which
are based on the idea of the inferiority or the superiority of either of the sexes or on stereotyped
roles for men and women."84 Justice Puno correctly pointed out that "(t)he paradigm shift changing
the character of domestic violence from a private affair to a public offense will require the
development of a distinct mindset on the part of the police, the prosecution and the judges."85
II. The classification is germane to the purpose of the law.
The distinction between men and women is germane to the purpose of R.A. 9262, which is to
address violence committed against women and children, spelled out in its Declaration of Policy,
as follows:
SEC. 2. Declaration of Policy. – It is hereby declared that the State values the dignity of women
and children and guarantees full respect for human rights. The State also recognizes the need to
protect the family and its members particularly women and children, from violence and threats to
their personal safety and security.
Towards this end, the State shall exert efforts to address violence committed against women and
children in keeping with the fundamental freedoms guaranteed under the Constitution and the
provisions of the Universal Declaration of Human Rights, the Convention on the Elimination of All
Forms of Discrimination Against Women, Convention on the Rights of the Child and other
international human rights instruments of which the Philippines is a party.
In 1979, the U.N. General Assembly adopted the CEDAW, which the Philippines ratified on August
5, 1981. Subsequently, the Optional Protocol to the CEDAW was also ratified by the Philippines
on October 6, 2003.86 This Convention mandates that State parties shall accord to women equality
with men before the law87 and shall take all appropriate measures to eliminate discrimination
against women in all matters relating to marriage and family relations on the basis of equality of
men and women.88 The Philippines likewise ratified the Convention on the Rights of the Child and
its two protocols.89 It is, thus, bound by said Conventions and their respective protocols.
III. The classification is not limited to existing
conditions only, and apply equally to all members
Moreover, the application of R.A. 9262 is not limited to the existing conditions when it was
promulgated, but to future conditions as well, for as long as the safety and security of women and
their children are threatened by violence and abuse.
R.A. 9262 applies equally to all women and children who suffer violence and abuse. Section 3
thereof defines VAWC as:
x x x any act or a series of acts committed by any person against a woman who is his wife, former
wife, or against a woman with whom the person has or had a sexual or dating relationship, or with
whom he has a common child, or against her child whether legitimate or illegitimate, within or
without the family abode, which result in or is likely to result in physical, sexual, psychological
harm or suffering, or economic abuse including threats of such acts, battery, assault, coercion,
harassment or arbitrary deprivation of liberty. It includes, but is not limited to, the following acts:
A. "Physical Violence" refers to acts that include bodily or physical harm;
B. "Sexual violence" refers to an act which is sexual in nature, committed against a woman or her
child. It includes, but is not limited to:
a) rape, sexual harassment, acts of lasciviousness, treating a woman or her child
as a sex object, making demeaning and sexually suggestive remarks, physically
attacking the sexual parts of the victim's body, forcing her/him to watch obscene
publications and indecent shows or forcing the woman or her child to do indecent
acts and/or make films thereof, forcing the wife and mistress/lover to live in the
conjugal home or sleep together in the same room with the abuser;
b) acts causing or attempting to cause the victim to engage in any sexual activity
by force, threat of force, physical or other harm or threat of physical or other
harm or coercion;
c) Prostituting the woman or child.
C. "Psychological violence" refers to acts or omissions causing or likely to cause mental or
emotional suffering of the victim such as but not limited to intimidation, harassment, stalking,
damage to property, public ridicule or humiliation, repeated verbal abuse and marital infidelity. It
includes causing or allowing the victim to witness the physical, sexual or psychological abuse of a
member of the family to which the victim belongs, or to witness pornography in any form or to
witness abusive injury to pets or to unlawful or unwanted deprivation of the right to custody and/or
visitation of common children.
D. "Economic abuse" refers to acts that make or attempt to make a woman financially dependent
which includes, but is not limited to the following:
1. withdrawal of financial support or preventing the victim from engaging in any
legitimate profession, occupation, business or activity, except in cases wherein
the other spouse/partner objects on valid, serious and moral grounds as defined
in Article 73 of the Family Code;
2. deprivation or threat of deprivation of financial resources and the right to the
use and enjoyment of the conjugal, community or property owned in common;
3. destroying household property;
4. controlling the victims' own money or properties or solely controlling the
conjugal money or properties.
It should be stressed that the acts enumerated in the aforequoted provision are attributable to
research that has exposed the dimensions and dynamics of battery. The acts described here are
also found in the U.N. Declaration on the Elimination of Violence Against Women. 90 Hence, the
argument advanced by petitioner that the definition of what constitutes abuse removes the
difference between violent action and simple marital tiffs is tenuous.
There is nothing in the definition of VAWC that is vague and ambiguous that will confuse petitioner
in his defense. The acts enumerated above are easily understood and provide adequate contrast
between the innocent and the prohibited acts. They are worded with sufficient definiteness that
persons of ordinary intelligence can understand what conduct is prohibited, and need not guess at
its meaning nor differ in its application.91 Yet, petitioner insists92that phrases like "depriving or
threatening to deprive the woman or her child of a legal right," "solely controlling the conjugal or
common money or properties," "marital infidelity," and "causing mental or emotional anguish" are
so vague that they make every quarrel a case of spousal abuse. However, we have stressed that
the "vagueness" doctrine merely requires a reasonable degree of certainty for the statute to be
upheld – not absolute precision or mathematical exactitude, as petitioner seems to suggest.
Flexibility, rather than meticulous specificity, is permissible as long as the metes and bounds of the
statute are clearly delineated. An act will not be held invalid merely because it might have been
more explicit in its wordings or detailed in its provisions.93
There is likewise no merit to the contention that R.A. 9262 singles out the husband or father as the
culprit. As defined above, VAWC may likewise be committed "against a woman with whom the
person has or had a sexual or dating relationship." Clearly, the use of the gender-neutral word
"person" who has or had a sexual or dating relationship with the woman encompasses even
lesbian relationships. Moreover, while the law provides that the offender be related or connected
to the victim by marriage, former marriage, or a sexual or dating relationship, it does not preclude
the application of the principle of conspiracy under the Revised Penal Code (RPC). Thus, in the
case of Go-Tan v. Spouses Tan,94 the parents-in-law of Sharica Mari L. Go-Tan, the victim, were
held to be proper respondents in the case filed by the latter upon the allegation that they and their
son (Go-Tan's husband) had community of design and purpose in tormenting her by giving her
insufficient financial support; harassing and pressuring her to be ejected from the family home;
and in repeatedly abusing her verbally, emotionally, mentally and physically.
R.A. 9262 is not violative of the
due process clause of the Constitution.
Petitioner bewails the disregard of R.A. 9262, specifically in the issuance of POs, of all protections
afforded by the due process clause of the Constitution. Says he: "On the basis of unsubstantiated
allegations, and practically no opportunity to respond, the husband is stripped of family, property,
guns, money, children, job, future employment and reputation, all in a matter of seconds, without
an inkling of what happened."95
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.96
"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."97
The rules require that petitions for protection order be in writing, signed and verified by the
petitioner98 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,"99 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.100
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.101
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,102 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,103among which is protection of women and children
from violence and threats to their personal safety and security.
It should be pointed out that when the TPO is issued ex parte, the court shall likewise order that
notice be immediately given to the respondent directing him to file an opposition within five (5)
days from service. Moreover, the court shall order that notice, copies of the petition and TPO be
served immediately on the respondent by the court sheriffs. The TPOs are initially effective for
thirty (30) days from service on the respondent.104
Where no TPO is issued ex parte, the court will nonetheless order the immediate issuance and
service of the notice upon the respondent requiring him to file an opposition to the petition within
five (5) days from service. The date of the preliminary conference and hearing on the merits shall
likewise be indicated on the notice.105
The opposition to the petition which the respondent himself shall verify, must be accompanied by
the affidavits of witnesses and shall show cause why a temporary or permanent protection order
should not be issued.106
It is clear from the foregoing rules that the respondent of a petition for protection order should be
apprised of the charges imputed to him and afforded an opportunity to present his side. Thus, the
fear of petitioner of being "stripped of family, property, guns, money, children, job, future
employment and reputation, all in a matter of seconds, without an inkling of what happened" is a
mere product of an overactive imagination. The essence of due process is to be found in the
reasonable opportunity to be heard and submit any evidence one may have in support of one's
defense. "To be heard" does not only mean verbal arguments in court; one may be heard also
through pleadings. Where opportunity to be heard, either through oral arguments or pleadings, is
accorded, there is no denial of procedural due process.107
It should be recalled that petitioner filed on April 26, 2006 an Opposition to the Urgent Ex-Parte
Motion for Renewal of the TPO that was granted only two days earlier on April 24, 2006. Likewise,
on May 23, 2006, petitioner filed a motion for the modification of the TPO to allow him visitation
rights to his children. Still, the trial court in its Order dated September 26, 2006, gave him five days
(5) within which to show cause why the TPO should not be renewed or extended. Yet, he chose
not to file the required comment arguing that it would just be an "exercise in futility," conveniently
forgetting that the renewal of the questioned TPO was only for a limited period (30 days) each
time, and that he could prevent the continued renewal of said order if he can show sufficient cause
therefor. Having failed to do so, petitioner may not now be heard to complain that he was denied
due process of law.
Petitioner next laments that the removal and exclusion of the respondent in the VAWC case from
the residence of the victim, regardless of ownership of the residence, is virtually a "blank check"
issued to the wife to claim any property as her conjugal home.108
The wording of the pertinent rule, however, does not by any stretch of the imagination suggest that
this is so. It states:
SEC. 11. Reliefs available to the offended party. -- The protection order shall include any, some or
all of the following reliefs:
xxxx
(c) Removing and excluding the respondent from the residence of the offended party, regardless
of ownership of the residence, either temporarily for the purpose of protecting the offended party,
or permanently where no property rights are violated. If the respondent must remove personal
effects from the residence, the court shall direct a law enforcement agent to accompany the
respondent to the residence, remain there until the respondent has gathered his things and escort
him from the residence;
xxxx
Indubitably, petitioner may be removed and excluded from private respondent's residence,
regardless of ownership, only temporarily for the purpose of protecting the latter. Such removal
and exclusion may be permanent only where no property rights are violated. How then can the
private respondent just claim any property and appropriate it for herself, as petitioner seems to
suggest?
The non-referral of a VAWC case
to a mediator is justified.
Petitioner argues that "by criminalizing run-of-the-mill arguments, instead of encouraging
mediation and counseling, the law has done violence to the avowed policy of the State to "protect
and strengthen the family as a basic autonomous social institution."109
Under Section 23(c) of A.M. No. 04-10-11-SC, the court shall not refer the case or any issue
thereof to a mediator. The reason behind this provision is well-explained by the Commentary on
Section 311 of the Model Code on Domestic and Family Violence as follows: 110
This section prohibits a court from ordering or referring parties to mediation in a proceeding for an
order for protection. Mediation is a process by which parties in equivalent bargaining positions
voluntarily reach consensual agreement about the issue at hand. Violence, however, is not a
subject for compromise. A process which involves parties mediating the issue of violence implies
that the victim is somehow at fault. In addition, mediation of issues in a proceeding for an order of
protection is problematic because the petitioner is frequently unable to participate equally with the
person against whom the protection order has been sought. (Emphasis supplied)
There is no undue delegation of
judicial power to barangay officials.
Petitioner contends that protection orders involve the exercise of judicial power which, under the
Constitution, is placed upon the "Supreme Court and such other lower courts as may be
established by law" and, thus, protests the delegation of power to barangay officials to issue
protection orders.111 The pertinent provision reads, as follows:
SEC. 14. Barangay Protection Orders (BPOs); Who May Issue and How. – Barangay Protection
Orders (BPOs) refer to the protection order issued by the Punong Barangay ordering the
perpetrator to desist from committing acts under Section 5 (a) and (b) of this Act.1âwphi1 A
Punong Barangay who receives applications for a BPO shall issue the protection order to the
applicant on the date of filing after ex parte determination of the basis of the application. If the
Punong Barangay is unavailable to act on the application for a BPO, the application shall be acted
upon by any available Barangay Kagawad. If the BPO is issued by a Barangay Kagawad, the
order must be accompanied by an attestation by the Barangay Kagawad that the Punong
Barangay was unavailable at the time of the issuance of the BPO. BPOs shall be effective for
fifteen (15) days. Immediately after the issuance of an ex parte BPO, the Punong Barangay or
Barangay Kagawad shall personally serve a copy of the same on the respondent, or direct any
barangay official to effect its personal service.
The parties may be accompanied by a non-lawyer advocate in any proceeding before the Punong
Barangay.
acquittal are nil. As already stated, assistance by barangay officials and other law enforcement
agencies is consistent with their duty to enforce the law and to maintain peace and order.
Conclusion
Before a statute or its provisions duly challenged are voided, an unequivocal breach of, or a clear
conflict with the Constitution, not merely a doubtful or argumentative one, must be demonstrated
in such a manner as to leave no doubt in the mind of the Court. In other words, the grounds for
nullity must be beyond reasonable doubt.116 In the instant case, however, no concrete evidence
and convincing arguments were presented by petitioner to warrant a declaration of the
unconstitutionality of R.A. 9262, which is an act of Congress and signed into law by the highest
officer of the co-equal executive department. As we said in Estrada v. Sandiganbayan, 117 courts
must assume that the legislature is ever conscious of the borders and edges of its plenary powers,
and passed laws with full knowledge of the facts and for the purpose of promoting what is right
and advancing the welfare of the majority.

Judicial power includes the duty of the courts of justice to settle actual controversies involving We reiterate here Justice Puno's observation that "the history of the women's movement against
rights which are legally demandable and enforceable, and to determine whether or not there has domestic violence shows that one of its most difficult struggles was the fight against the violence
been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any of law itself. If we keep that in mind, law will not again be a hindrance to the struggle of women for
branch or instrumentality of the Government.112 On the other hand, executive power "is generally equality but will be its fulfillment."118 Accordingly, the constitutionality of R.A. 9262 is, as it should
defined as the power to enforce and administer the laws. It is the power of carrying the laws into be, sustained.
practical operation and enforcing their due observance."113
WHEREFORE, the instant petition for review on certiorari is hereby DENIED for lack of merit.
As clearly delimited by the aforequoted provision, the BPO issued by the Punong Barangay or, in
his unavailability, by any available Barangay Kagawad, merely orders the perpetrator to desist
SO ORDERED.
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."114

We have held that "(t)he mere fact that an officer is required by law to inquire into the existence of
certain facts and to apply the law thereto in order to determine what his official conduct shall be
and the fact that these acts may affect private rights do not constitute an exercise of judicial
powers."115

In the same manner as the public prosecutor ascertains through a preliminary inquiry or
proceeding "whether there is reasonable ground to believe that an offense has been committed
and the accused is probably guilty thereof," the Punong Barangay must determine reasonable
ground to believe that an imminent danger of violence against the woman and her children exists
or is about to recur that would necessitate the issuance of a BPO. The preliminary investigation
conducted by the prosecutor is, concededly, an executive, not a judicial, function. The same holds
true with the issuance of a BPO.

We need not even belabor the issue raised by petitioner that since barangay officials and other
law enforcement agencies are required to extend assistance to victims of violence and abuse, it
would be very unlikely that they would remain objective and impartial, and that the chances of
 Republic of the Philippines In the meantime, petitioner union on July 12, 1985, filed a complaint for unfair labor practice
SUPREME COURT against both Super Garments and Rustan alleging that the former is but the manufacturing arm of
Manila the latter.

SECOND DIVISION Petitioner union claims that respondent judge has no jurisdiction to issue an injunction because
the case is a labor dispute; that the prerogative belongs to the Minister of Labor and Employment.
G.R. No. L-71959 November 28, 1985 Upon the other hand, private respondent Rustan says that the respondent judge has jurisdiction
because there is no labor dispute between it and the union even as it went to the National Labor
Relation Commission to seek Identical relief.
TRADE UNIONS OF THE PHILIPPINES & ALLIED SERVICES LOCAL CHAPTER NO. 1158
(SUPER GARMENTS MANUFACTURING CORPORATION WORKERS UNION), petitioner,
vs. At this stage there appears to be no labor dispute between the petitioner and the private
HON. JOSE L. COSCOLLUELA JR., PRESIDING JUDGE OF BRANCH CXLVI REGIONAL respondent for which reason the latter was justified in seeking relief in respondent judge's court.
TRIAL COURT OF MAKATI AND RUSTAN COMMERCIAL CORPORATION, respondents. ihe unfair labor complaint filed by petitioner union on Page 304 July 12, 1985 does not prove a
labor relationship. By the same token it was improper for the private respondent to have filed Case
No. 971 with the National Labor Relations Commission.
RESOLUTION
In the light of the foregoing, the petition is dismissed for lack of merit and the temporary restraining
order issued on September 23, 1985 is hereby lifted. However, private respondent Rustan
Commercial Corporation is directed to withdraw its case before the National Labor Relations
ABAD SANTOS, J.: Commission. No costs.

The petition seeks to enjoin the public respondent from further proceeding in Civil Case No. 10905 SO ORDERED,
of the Regional Trial Court of Makati, Metro Manila. Upon the filing of the petition this Court issued
a temporary restraining order and required the private respondent to comment.

Petitioner union filed a notice of strike with the Ministry of Labor and Employment against Super
Garments Manufacturing Corporation on May 12, 1985. The strike commenced on June 8, 1985
and is said to be still on.

Super Garments and Rustan Commercial Corporation have separate compartments in the same
building at Malugay and streets It is called the Yupangco building.

It is alleged by the petitioner union that goods of Super Garments were spirited out of its strike-
bound premises thru Rustan's warehouse. Whereupon, the union picketed not only Super
Garments but also Rustan. As a result Rustan filed Civil Case No. 10905 before the respondent
judge for injunction and damages thru the PECABAR law office and petition No. 971 with the
National Labor Relations Commission also to enjoin the union from picketing its premises. The
petition was filed by another counsel, Atty. Armando B. Ampil.

In Civil Case No. 10905, the respondent judge issued an order on June 21, 1985 setting "the
hearing of theapplication for a writ of preliminary injuction on June 27, 1985 at 2:00 o'clock in the
afternoon." On July 15, 1985, the respondent judge issued the writ after finding no employer-
employee relationship between the parties. This order prompted the petitioner union to come to
this Court for the purpose aforesaid.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 72644 December 14, 1987
ALFREDO F. PRIMERO, petitioner,
vs.
INTERMEDIATE APPELLATE COURT and DM TRANSIT, respondents.
NARVASA, J.:
The question on which the petitioner's success in the instant appeal depends, and to which he
would have us give an affirmative answer, is whether or not, having recovered separation pay by
judgment of the Labor Arbiter — which held that he had been fired by respondent DM Transit
Corporation without just cause — he may subsequently recover moral damages by action in a
regular court, upon the theory that the manner of his dismissal from employment was tortious and
therefore his cause of action was intrinsically civil in nature.
Petitioner Primero was discharged from his employment as bus driver of DM Transit Corporation
(hereafter, simply DM) in August, 1974 after having been employed therein for over 6 years. The
circumstances attendant upon that dismissal are recounted by the Court of Appeals 1 as follows:
Undisputably, since August 1, 1974, appellee's bus dispatcher did not assign any
bus to be driven by appellant Primero. No reason or cause was given by the
dispatcher to appellant for not assigning a bus to the latter for 23 days (pp. 6-14,
21-22, tsn, May 15, 1979).
Also, for 23 days, appellant was given a run-around from one management
official to another, pleading that he be allowed to work as his family was in dire
need of money and at the same time inquiring (why) he was not allowed to work
or drive a bus of the company. Poor appellant did not only get negative results
but was given cold treatment, oftentimes evaded and given confusing
information, or ridiculed, humiliated, or sometimes made to wait in the offices of
some management personnel of the appellee (pp. 2-29, tsn, May 15, 1979).
(The) General Manager and (the) Vice-President and Treasurer ... wilfully and
maliciously made said appellant ... seesaw or ... go back and forth between them
for not less than ten (10) times within a period of 23 days ... but (he) got negative
results from both corporate officials. Worse, on the 23rd day of his ordeal
appellant was suddenly told by General Manager Briones to seek employment
with other bus companies because he was already dismissed from his job with
appellee (without having been) told of the cause of his hasty and capricious
dismissal ... (pp. 8, 11-13, 25, tsn, May 15, 1979).
Impelled to face the harsh necessities of life as a jobless person and worried by
his immediate need for money, appellant pleaded with Corporate President
Demetrio Munoz, Jr. for his reinstatement and also asked P300.00 as financial
assistance, but the latter told the former that he (Munoz, Jr.) will not give him
even one centavo and that should appellant sue him in court, then that will be the
time President Munoz, Jr. will pay him, if Munoz, Jr. loses the case x x (pp. 21-
22, tsn, May 15, 1979).
Appellant also advised (the) President of the oppressive, anti-social and
inhumane acts of subordinate officers ... (but) Munoz, Jr. did nothing to resolve
appellant's predicament and ... just told the latter to go back ... to ... Briones, who
insisted that appellant seek employment with other bus firms in Metro Manila ...
(but) admitted that the appellant has not violated any company rule or regulation
... (pp. 23-26, tsn, May 15, 1979).
... In pursuance (of) defendant's determination to oppress plaintiff and cause
further loss, irreparable injury, prejudice and damage, (D.M. Transit) in bad faith
and with malice persuaded other firms (California Transit, Pascual Lines, De Dios
Transit, Negrita Corporation, and MD Transit) not to employ (appellant) in any
capacity after he was already unjustly dismissed by said defendant ... (paragraph
8 of plaintiff's complaint).
These companies with whom appellant applied for a job called up the D.M.
Transit Office (which) ... told them ... that they should not accept (appellant)
because (he) was dismissed from that Office.
Primero instituted proceedings against DM with the Labor Arbiters of the Department of Labor, for
illegal dismissal, and for recovery of back wages and reinstatement. It is not clear from the record
whether these proceedings consisted of one or two actions separately filed. What is certain is that
he withdrew his claims for back wages and reinstatement, "with the end in view of filing a damage
suit" "in a civil court which has exclusive jurisdiction over his complaint for damages on causes of
action founded on tortious acts, breach of employment contract ... and consequent effects (thereof
). 2
In any case, after due investigation, the Labor Arbiter rendered judgment dated January 24, 1977
ordering DM to pay complainant Primero P2,000.00 as separation pay in accordance with the
Termination Pay Law. 3 The judgment was affirmed by the National Labor Relations Commission
and later by the Secretary of Labor, the case having been concluded at this level on March 3,
1978. 4
Under the provisions of the Labor Code in force at that time, Labor Arbiters had jurisdiction inter
alia over —
 1) claims involving non-payment or underpayment of wages, overtime
compensation, social security and medicare benefits, and
2) all other cases or matters arising from employer-employee relations, unless
otherwise expressly excluded. 5
And we have since held that under these "broad and comprehensive" terms of the law, Labor
Arbiters possessed original jurisdiction over claims for moral and other forms of damages in labor
disputes. 6
The jurisdiction of Labor Arbiters over such claims was however removed by PD 1367, effective
May 1, 1978, which explicitly provided that "Regional Directors shall not indorse and Labor
Arbiters shall not entertain claims for moral or other forms of damages." 7
Some three months afterwards, Primero brought suit against DM in the Court of First Instance of
Rizal seeking recovery of damages caused not only by the breach of his employment contract, but
also by the oppressive and inhuman, and consequently tortious, acts of his employer and its
officers antecedent and subsequent to his dismissal from employment without just cause. 8
While this action was pending in the CFI, the law governing the Labor Arbiters' jurisdiction was
once again revised. The amending act was PD 1691, effective May 1, 1980. It eliminated the
restrictive clause placed by PD 1367, that Regional Directors shall not indorse and Labor Arbiters
entertain claims for moral or other forms of damages. And, as we have had occasion to declare in
several cases, it restored the principle that "exclusive and original jurisdiction for damages would
once again be vested in labor arbiters;" eliminated "the rather thorny question as to where in labor
matters the dividing line is to be drawn between the power lodged in an administrative body and a
court;' " and, "in the interest of greater promptness in the disposition of labor matters, ... spared
(courts of) the often onerous task of determining what essentially is a factual matter, namely, the
damages that may be incurred by either labor or management as a result of disputes or
controversies arising from employer-employee relations." 9 Parenthetically, there was still another
amendment of the provision in question which, however, has no application to the case at bar. The
amendment was embodied in B.P. Blg. 227, effective June 1, 1982. 10
On August 11, 1980 the Trial Court rendered judgment dismissing the complaint on the ground of
lack of jurisdiction, for the reason that at the time that the complaint was filed. on August 17, 1978,
the law — the Labor Code as amended by PD 1367, eff. May 1, 1978 — conferred exclusive,
original jurisdiction over claims for moral or other damages, not on ordinary courts, but on Labor
Arbiters.
This judgment was affirmed by the Intermediate Appellate Court, by Decision rendered on June
29, 1984. This is the judgment now subject of the present petition for review on certiorari. The
decision was reached by a vote of 3 to 2. The dissenters, placing reliance on certain of our
pronouncements, opined that Primero's causes of action were cognizable by the courts, that
existence of employment relations was not alone decisive of the issue of jurisdiction, and that such
relations may indeed give rise to "civil" as distinguished from purely labor disputes, as where an
employer's right to dismiss his employee is exercised tortiously, in a manner oppressive to labor,
contrary to morals, good customs or public policy. 11
Primero has appealed to us from this judgment of the IAC praying that we overturn the majority
view and sustain the dissent.
Going by the literal terms of the law, it would seem clear that at the time that Primero filed his
complaints for illegal dismissal and recovery of backwages, etc. with the Labor Arbiter, the latter
possessed original and exclusive jurisdiction also over claims for moral and other forms of
damages; this, in virtue of Article 265 12 of PD 442, otherwise known as the Labor Code, effective
from May 1, 1974. In other words, in the proceedings before the Labor Arbiter, Primero plainly had
the right to plead and prosecute a claim not only for the reliefs specified by the Labor Code itself
for unlawful termination of employment, but also for moral or other damages under the Civil
Code arising from or connected with that termination of employment. And this was the state of the
law when he moved for the dismissal of his claims before the Labor Arbiter, for reinstatement and
recovery of back wages, so that he might later file a damage suit "in a civil court which has
exclusive jurisdiction over his complaint ... founded on tortious acts, breach of employment
contract ... and consequent effects (thereof)." 13
The legislative intent appears clear to allow recovery in proceedings before Labor Arbiters of moral
and other forms of damages, in all cases or matters arising from employer-employee relations.
This would no doubt include, particularly, instances where an employee has been unlawfully
dismissed. In such a case the Labor Arbiter has jurisdiction to award to the dismissed employee
not only the reliefs specifically provided by labor laws, but also moral and other forms of damages
governed by the Civil Code. Moral damages would be recoverable, for example, where the
dismissal of the employee was not only effected without authorized cause and/or due process for
which relief is granted by the Labor Code — but was attended by bad faith or fraud, or constituted
an act oppressive to labor, or was done in a manner contrary to morals, good customs or public
policy 14 — for which the obtainable relief is determined by the Civil Code 15 (not the Labor
Code). Stated otherwise, if the evidence adduced by the employee before the Labor Arbiter should
establish that the employer did indeed terminate the employee's services without just cause or
without according him due process, the Labor Arbiter's judgment shall be for the employer to
reinstate the employee and pay him his back wages or, exceptionally, for the employee simply to
receive separation pay. These are reliefs explicitly prescribed by the Labor Code. 16 But any
award of moral damages by the Labor Arbiter obviously cannot be based on the Labor Code but
should be grounded on the Civil Code. Such an award cannot be justified solely upon the premise
(otherwise sufficient for redress under the Labor Code) that the employer fired his employee
without just cause or due process. Additional facts must be pleaded and proven to warrant the
grant of moral damages under the Civil Code, these being, to repeat, that the act of dismissal was
attended by bad faith or fraud, or was oppressive to labor, or done in a manner contrary to morals,
good customs, or public policy; and, of course, that social humiliation, wounded feelings, grave
anxiety, etc., resulted therefrom. 17
It is clear that the question of the legality of the act of dismissal is intimately related to the issue of
the legality of the manner by which that act of dismissal was performed. But while the Labor Code
treats of the nature of, and the remedy available as regards the first — the employee's separation
from employment — it does not at all deal with the second — the manner of that separation —
which is governed exclusively by the Civil Code. In addressing the first issue, the Labor Arbiter
applies the Labor Code; in addressing the second, the Civil Code. And this appears to be the plain
and patent intendment of the law. For apart from the reliefs expressly set out in the Labor Code
flowing from illegal dismissal from employment, no other damages may be awarded to an illegally
dismissed employee other than those specified by the Civil Code. Hence, the fact that the issue-of WHEREFORE, the petition is DISMISSED, without pronouncement as to costs.
whether or not moral or other damages were suffered by an employee and in the affirmative, the
amount that should properly be awarded to him in the circumstances-is determined under the
provisions of the Civil Code and not the Labor Code, obviously was not meant to create a cause of
action independent of that for illegal dismissal and thus place the matter beyond the Labor
Arbiter's jurisdiction.

Thus, an employee who has been illegally dismissed (i.e., discharged without just cause or being
accorded due process), in such a manner as to cause him to suffer moral damages (as
determined by the Civil Code), has a cause of action for reinstatement and recovery of back
wages and damages. When he institutes proceedings before the Labor Arbiter, he should make a
claim for all said reliefs. He cannot, to be sure, be permitted to prosecute his claims piecemeal. He
cannot institute proceedings separately and contemporaneously in a court of justice upon the
same cause of action or a part thereof. He cannot and should not be allowed to sue in two forums:
one, before the Labor Arbiter for reinstatement and recovery of back wages, or for separation pay,
upon the theory that his dismissal was illegal; and two, before a court of justice for recovery of
moral and other damages, upon the theory that the manner of his dismissal was unduly injurious,
or tortious. This is what in procedural law is known as splitting causes of action, engendering
multiplicity of actions. It is against such mischiefs that the Labor Code amendments just discussed
are evidently directed, and it is such duplicity which the Rules of Court regard as ground for
abatement or dismissal of actions, constituting either litis pendentia (auter action pendant) or res
adjudicata, as the case may be. 18 But this was precisely what Primero's counsel did. He split
Primero's cause of action; and he made one of the split parts the subject of a cause of action
before a court of justice. Consequently, the judgment of the Labor Arbiter granting Primero
separation pay operated as a bar to his subsequent action for the recovery of damages before the
Court of First Instance under the doctrine of res judicata, The rule is that the prior "judgment or
order is, with respect to the matter directly adjudged or as to any other matter that could have
been raised in relation thereto, conclusive between the parties and their successors in interest by
title subsequent to the commencement of the action or special proceeding, litigating for the same
thing and under the same title and in the same capacity. 19

We are not unmindful of our previous rulings on the matter cited in the dissent to the decision of
the Court of Appeals subject of the instant petition, 20 notably, Quisaba v. Sta Ines-Melale Veneer
& Plywood Inc., where a distinction was drawn between the right of the employer to dismiss an
employee, which was declared to be within the competence of labor agencies to pass upon, and
the "manner in which the right was exercised and the effects flowing therefrom," declared to be a
matter cognizable only by the regular courts because "intrinsically civil." 21 We opine that it is this
very distinction which the law has sought to eradicate as being so tenuous and so difficult to
observe, 22 and, of course, as herein pointed out, as giving rise to split jurisdiction, or to multiplicity
of actions, "a situation obnoxious to the orderly administration of justice. 23 Actually we merely
reiterate in this decision the doctrine already laid down in other cases (Garcia v. Martinez, 84
SCRA 577; Ebon v. de Guzman, 13 SCRA 52; Bengzon v. Inciong, 91 SCRA 248; Pepsi-Cola
Bottling Co. v. Martinez, 112 SCRA 578; Aguda v. Vallejos, 113 SCRA 69; Getz v. C.A., 116
SCRA 86; Cardinal Industries v. Vallejos, 114 SCRA 471; Sagmit v. Sibulo, 133 SCRA 359) to the
effect that the grant of jurisdiction to the Labor Arbiter by Article 217 of the Labor Code is
sufficiently comprehensive to include claims for moral and exemplary damages sought to be
recovered from an employer by an employee upon the theory of his illegal dismissal. Rulings to
the contrary are deemed abandoned or modified accordingly.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 89621 September 24, 1991
PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., represented by its Plant General
Manager ANTHONY B. SIAN, ELEAZAR LIMBAB, IRENEO BALTAZAR & JORGE
HERAYA, petitioners,
vs.
HON. LOLITA O. GAL-LANG, SALVADOR NOVILLA, ALEJANDRO OLIVA, WILFREDO
CABAÑAS & FULGENCIO LEGO, respondents.
Aurelio D. Menzon for petitioners.
Mario P. Nicolasora co-counsel for petitioners.
Papiano L. Santo for private respondents.
CRUZ, J.:
The question now before us has been categorically resolved in earlier decisions of the Court that a
little more diligent research would have disclosed to the petitioners. On the basis of those cases
and the facts now before us, the petition must be denied.
The private respondents were employees of the petitioner who were suspected of complicity in the
irregular disposition of empty Pepsi Cola bottles. On July 16, 1987, the petitioners filed a criminal
complaint for theft against them but this was later withdrawn and substituted with a criminal
complaint for falsification of private documents. On November 26, 1987, after a preliminary
investigation conducted by the Municipal Trial Court of Tanauan, Leyte, the complaint was
dismissed. The dismissal was affirmed on April 8, 1988, by the Office of the Provincial Prosecutor.
Meantime, allegedly after an administrative investigation, the private respondents were dismissed
by the petitioner company on November 23, 1987. As a result, they lodged a complaint for illegal
dismissal with the Regional Arbitration Branch of the NLRC in Tacloban City on December 1,
1987, and decisions manded reinstatement with damages. In addition, they instituted in the
Regional Trial Court of Leyte, on April 4, 1988, a separate civil complaint against the petitioners
for damages arising from what they claimed to be their malicious prosecution.
The petitioners moved to dismiss the civil complaint on the ground that the trial court had no
jurisdiction over the case because it involved employee-employer relations that were exclusively
cognizable by the labor arbiter. The motion was granted on February 6, 1989. On July 6, 1989,
however, the respondent judge, acting on the motion for reconsideration, reinstated the complaint,
saying it was "distinct from the labor case for damages now pending before the labor courts." The
petitioners then came to this Court for relief.
The petitioners invoke Article 217 of the Labor Code and a number of decisions of this Court to
support their position that the private respondents civil complaint for damages falls under the
jurisdiction of the labor arbiter. They particularly cite the case of Getz Corporation v. Court of
Appeals,1 where it was held that a court of first instance had no jurisdiction over the complaint filed
by a dismissed employee "for unpaid salary and other employment benefits, termination pay and
moral and exemplary damages."
We hold at the outset that the case is not in point because what was involved there was a claim
arising from the alleged illegal dismissal of an employee, who chose to complain to the regular
court and not to the labor arbiter. Obviously, the claim arose from employee-employer relations
and so came under Article 217 of the Labor Code which then provided as follows:
ART. 217. Jurisdiction of Labor Arbiters and the Commission. — (a) The Labor Arbiters
shall have the original and exclusive jurisdiction to hear and decide within thirty (30)
working days after submission of the case by the parties for decision, the following cases
involving all workers, whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Those that workers may file involving wages, hours of work and other terms and
conditions of employment;
3. All money claims of workers, including those based on non-payment or underpayment
of wages, overtime compensation, separation pay and other benefits provided by law or
appropriate agreement, except claims for employees' compensation, social security,
medicare and maternity benefits;
4. Cases involving household services; and
5. Cases arising from any violation of Article 265 of this Code, including questions
involving the legality of strikes and lockouts.
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by
labor Arbiters.2
It must be stressed that not every controversy involving workers and their employers can be
resolved only by the labor arbiters. This will be so only if there is a "reasonable causal connection"
between the claim asserted and employee-employer relations to put the case under the provisions
of Article 217. Absent such a link, the complaint will be cognizable by the regular courts of justice
in the exercise of their civil and criminal jurisdiction.
In Medina v. Castro-Bartolome,3 two employees filed in the Court of First Instance of Rizal a civil
complaint for damages against their employer for slanderous remarks made against them by the
company president. On the order dismissing the case because it came under the jurisdiction of the
labor arbiters, Justice Vicente Abad Santos said for the Court:
It is obvious from the complaint that the plaintiffs have not alleged any unfair labor
practice. Theirs is a simple action for damages for tortious acts allegedly committed by
the defendants. Such being the case, the governing statute is the Civil Code and not the
Labor Code. It results that the orders under review are based on a wrong premise.
In Singapore Airlines Ltd. v. Paño,4 where the plaintiff was suing for damages for alleged violation
by the defendant of an "Agreement for a Course of Conversion Training at the Expense of
Singapore Airlines Limited," the jurisdiction of the Court of First Instance of Rizal over the case
was questioned. The Court, citing the earlier case of Quisaba v. Sta. Ines Melale Veneer and
Plywood, Inc.,5 declared through Justice Herrera:
Stated differently, petitioner seeks protection under the civil laws and claims no benefits
under the Labor Code. The primary relief sought is for liquidated damages for breach of a
contractual obligation. The other items demanded are not labor benefits demanded by
workers generally taken cognizance of in labor disputes, such as payment of wages,
overtime compensation or separation pay. The items claimed are the natural
consequences flowing from breach of an obligation, intrinsically a civil dispute.
In Molave Sales, Inc. v. Laron,6 the same Justice held for the Court that the claim of the plaintiff
against its sales manager for payment of certain accounts pertaining to his purchase of vehicles
and automotive parts, repairs of such vehicles, and cash advances from the corporation was
properly cognizable by the Regional Trial Court of Dagupan City and not the labor arbiter, because
"although a controversy is between an employer and an employee, the Labor Arbiters have
nojurisdiction if the Labor Code is not involved."
The latest ruling on this issue is found in San Miguel Corporation v. NLRC,7 where the above
cases are cited and the changes in Article 217 are recounted. That case involved a claim of an
employee for a P60,000.00 prize for a proposal made by him which he alleged had been accepted
and implemented by the defendant corporation in the processing of one of its beer products. The
claim was filed with the labor arbiter, who dismissed it for lack of jurisdiction but was reversed by
the NLRC on appeal. In setting aside the appealed decision and dismissing the complaint, the
Court observed through Justice Feliciano:
It is the character of the principal relief sought that appears essential, in this connection.
Where such principal relief is to be granted under labor legislation or a collective
bargaining agreement, the case should fall within the jurisdiction of the Labor Arbiter and
the NLRC, even though a claim for damages might be asserted as an incident to such
claim.
xxx xxx xxx
Where the claim to the principal relief sought is to be resolved not by reference to the
Labor Code or other labor relations statute or a collective bargaining agreement but by
the general civil law, the jurisdiction over the dispute belongs to the regular courts of
justice and not to the Labor Arbiter and the NLRC. In such situations, resolution of the
dispute requires expertise, not in labor management relations nor in wage structures and
other terms and conditions of employment, but rather in the application of the general civil
law. Clearly, such claims fall outside the area of competence or expertise ordinarily
ascribed to Labor Arbiters and the NLRC and the rationale for granting jurisdiction over
such claims to these agencies disappears.
xxx xxx xxx
While paragraph 3 above refers to "all money claims of workers," it is not necessary to
suppose that the entire universe of money claims that might be asserted by workers
against their employers has been absorbed into the original and exclusive jurisdiction of
Labor Arbiters.
xxx xxx xxx
For it cannot be presumed that money claims of workers which do not arise out of or in
connection with their employer-employee relationship, and which would therefore fall
within the general jurisdiction of the regular courts of justice, were intended by the
legislative authority to be taken away from the jurisdiction of the courts and lodged with
Labor Arbiters on an exclusive basis. The Court, therefore, believes and so holds that the
'money claims of workers" referred to in paragraph 3 of Article 217 embraces money
claims which arise out of or in connection with the employer- employee relationship, or
some aspect or incident of such relationship. Put a little differently, that money claims of
workers which now fall within the original and exclusive jurisdiction of Labor Arbiters are
those money claims which have some reasonable causal connection with the employer-
employee relationship (Ibid.).
The case now before the Court involves a complaint for damages for malicious prosecution which
was filed with the Regional Trial Court of Leyte by the employees of the defendant company. It
does not appear that there is a "reasonable causal connection" between the complaint and the
relations of the parties as employer and employees. The complaint did not arise from such
relations and in fact could have arisen independently of an employment relationship between the
parties. No such relationship or any unfair labor practice is asserted. What the employees are
alleging is that the petitioners acted with bad faith when they filed the criminal complaint which the
Municipal Trial Court said was intended "to harass the poor employees" and the dismissal of which
was affirmed by the Provincial Prosecutor "for lack of evidence to establish even a slightest
probability that all the respondents herein have committed the crime imputed against them." This
is a matter which the labor arbiter has no competence to resolve as the applicable law is not the
Labor Code but the Revised Penal Code.
"Talents differ, all is well and wisely put," so observed the philosopher-poet.8 So it must be in the
case we here decide.
WHEREFORE, the order dated July 6, 1989, is AFFIRMED and the petition DENIED, with costs
against the petitioner.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 70174 February 9, 1993
JOSE TIPAIT, SUBSTITUTED BY JOEL S. TIPAIT, MONTANO S. TIPAIT, JOSE S. TIPAIT,
HELEN S. TIPAIT, EVELYN S. TIPAIT and BEATRIZ S. TIPAIT, petitioners,
vs.
HON. JUAN Y. REYES, REGIONAL TRIAL COURT JUDGE, 7th JUDICIAL REGION AND
SPOUSES ANGEL C. VELOSO AND MILAGROS ESCANO VELOSO, respondents.
Virgilio U. Lapinid for petitioners.
Felipe S. Velasquez for private respondents.
MELO, J.:
This refers to a petition for certiorari to annul all orders issued by respondent judge in Civil Case
No. R-20975 of the then Court of First Instance (now Regional Trial Court) of Cebu. On March 27,
1985, this Court issued a resolution considering the spouses Angel C. Veloso and Milagros
Escano Veloso impleaded as respondents (p. 45, Rollo).
The record reveals the following antecedent facts:
On October 7, 1976, laborers Faustino Garbo, Certerio Garbo, Arcenio Alum, Genaro Requizo,
Expedito Armenteros, William Campana, and Ramos Faura filed a complaint (p. 12, Rollo),
docketed a TFU Case No. 536 of the Regional Office No. VII of the Department of Labor, Cebu
City, for illegal dismissal or reinstatement with backwages, living allowance, and overtime pay
against M.E. Veloso Enterprises and/or Milagros Escano Veloso and/or Angel Veloso.
On October 20, 1976, Regional Director Francisco Armado issued an order (Annex E, Petition, pp.
13-14, Rollo) against private respondents and M.E. Veloso Enterprises to reinstate complainants
and remunerate them overtime-pay and emergency allowance.
Private respondents and M.E. Veloso Enterprises filed a motion for reconsideration (Annex F,
Petition, pp. 15-18, Rollo) of the order of October 20, 1976. On December 6, 1976, the Regional
Director issued an order (Annex G, Petition, p. 19, Rollo) setting aside the order of October 20,
1976 and reopening the case for the reception of additional evidence.
After the parties had submitted their evidence, the Regional Director issued an order dated
February 3, 1977 (Annex H, Petition, pp. 20-22, Rollo) reiterating his previous order directing
respondents therein to reinstate the complainants and to pay them overtime pay and emergency
allowance. Respondents appealed to the Minister of Labor. On October 18, 1979, the Minister of
Labor rendered a decision (Annex C, Petition, pp. 9-11, Rollo) dismissing the appeal. Private
respondents filed a motion for reconsideration which was denied by the Minister of Labor in an
order dated July 1, 1981. A second motion for reconsideration was filed by private respondents
and said second motion for reconsideration was denied by the Deputy Minister, by authority of the
Minister, in an order dated January 25, 1985 (Annex 3, Private Respondents' Comment, p.
71, Rollo). In said order the Deputy Minister directed the issuance of a writ of execution.
Private respondents appealed to the Office of the President. On August 18, 1985, Presidential
Assistant for Legal Affairs Manuel Lazaro, by authority of the President, issued an order denying
the appeal (p. 108, Rollo).
In the meantime, on August 18, 1981, the Office of the Minister of Labor remanded the record of
the case to the Regional Director for execution and/or appropriate action (Answer of Regional
Director, Annex J of Petition. p. 34, Rollo). On September 18, 1981, the Regional Director issued a
writ of execution (Annex B, Petition, p. 8, Rollo) and a notice of auction sale was issued by the
Provincial Sheriff involving 4 parcels of land with improvements (Annex 6, Respondents'
Comment, pp. 74-75, Rollo). At the auction sale, the highest bidder was petitioner herein who paid
the amount of P100,000.00 to the Deputy Sheriff and the latter issued a certificate of sale dated
December 19, 1981 (Annex A, Respondents' Comment, pp. 83-84, Rollo).
On September 28, 1981, private respondents filed a complaint docketed as Civil Case No. R-
20975 of the Court of First Instance of Cebu (Annex I of Petition, pp. 23-30, Rollo) for prohibition,
praying that the Provincial Sheriff or his deputies be restrained from enforcing or implementing the
writ of execution issued in TFU Case No. 536 and that said writ of execution be annulled. On June
11, 1982, respondent judge issued an order (Annex A of Petition, pp. 6-7, Rollo) nullifying the
public auction sale and the Certificate of Sale.
Hence, petitioner (now substituted by his heirs, Resolution of March 8, 1989, p. 171, Rollo) filed
the present petition, contending that respondent court has no jurisdiction over Civil Case No. R-
20975.
The petition is impressed with merit.
It is readily apparent that respondent court has no jurisdiction over Civil Case No. R-20975 whose
subject-matter is an incident of a labor case. Actually, said civil case is in the nature of a motion to
quash the writ of execution issued in TFU Case No. 536, a labor case over which the Regional
Director of the Department of Labor has original and exclusive jurisdiction (Article 217, Labor Code
of the Philippines, as amended, Policy Instructions No. 6 of the Minister of Labor). This Court in a
similar case held:
A perusal of the petition for damages and prohibition filed by Saulog Transit, Inc.
in the lower court reveals that basically, what was being questioned was the
legality or propriety of the alias writ of execution dated March 1, 1985, as well as
 the acts performed by the Ministry officials in implementing the same. In other
words, the petition was actually in the nature of a motion to quash the writ; and
with respect to the acts of the Ministry officials, a case growing out of a labor
dispute, as the acts complained of, were perpetrated during the execution of a
decision of the then Minister of Labor and Employment. However characterized,
jurisdiction over the petition pertains to the Labor Ministry, now Department and
not the regular courts. This conclusion is evident, not only from the provisions of
Article 224 [b] of the Labor Code, but also of Article 218, as amended by Batas
Pambansa Blg. 227 in connection with Article 255 of the same Code. (Pucan vs.
Bengzon, 155 SCRA 692, 699 [1987]).

The proper remedy that private respondents should have taken, instead of instituting Civil Case
No. R-20975, was to file the necessary petition or motion before the Secretary of Labor who has
the power and authority to take any measure under existing laws to ensure compliance with the
decisions, orders and awards of the Department of Labor. Despite the finality of the decision of the
Regional Director, the Secretary of Labor retains control over its execution and implementation
(Pucan vs. Bengzon, supra).

WHEREFORE, respondent court is hereby ordered to DISMISS Civil Case No. R-20975 for lack of
jurisdiction and all orders previously issued therein are hereby ANNULLED and SET ASIDE.

Costs against private respondents.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 92598 May 20, 1994
PURIFICACION Y. MANLIGUEZ, ANTONINA Y. LUIS and BENJAMIN C. YBANEZ, petitioners,
vs.
THE COURT OF APPEALS, ET AL., respondents.
Rufino L. Remoreras for petitioners.
Danilo L. Pilapil for private respondents.
PUNO, J.:
This is an appeal by certiorari from the Decision of the Court of Appeals,1 dated November 16,
1989, denying due course to and dismissing the petition in CA-G.R. SP NO. 18017.2
The case at bench finds its roots in the Decision of the Department of Labor and Employment
(Region VII), ordering Inductocast Cebu, a partnership based in Mandaue City, to pay its former
employees a total of P232,908.00. As a consequence of the judgment, the labor department's
regional sheriff levied the buildings and improvements standing on Lot 109, Plan 11-5121-Amd., at
Tipolo, Mandaue City. The levied properties (hereinafter referred to as the "Tipolo properties")
were subsequently sold at public auction to said employees.
On May 25, 1988, petitioners filed with the RTC of Cebu City, 7th Judicial Branch, a
Complaint3 which sought the lifting of the levy over, and annulment of the sale of, the Tipolo
properties. The Complaint was docketed as Civil Case No. Ceb-6917, and raffled to Branch 8 of
the trial court. Petitioners therein alleged that: they are the owners of the Lot 109; they entered
into a lease agreement with Inductocast Cebu over Lot 109; the lease contract provided that,
except for machineries and equipment, all improvements introduced in the leased premises shall
automatically be owned by the Lessor (petitioners) upon the expiration/termination of the
contract;4 the lease agreement was terminated by petitioners in November, 1980 due to non-
payment of rentals by Inductocast Cebu;5 thereafter, petitioners took actual possession of and
occupied the Tipolo properties. Petitioners likewise alleged in their Complaint that they became
aware of the labor dispute involving Inductocast only after the impugned public auction sale. 6
Atty. Danilo Pilapil, claiming to be the John Doe named in the Complaint, filed a motion to dismiss
on the ground that the trial court had no jurisdiction over the case. The buyers of the Tipolo
properties, as intervenors, also filed a motion to dismiss on the same ground. Both motions, which
were opposed by petitioners, were denied.
The intervenors, however, moved for reconsideration of the denial. In an Order dated April 18,
1989, the trial court granted the motion and dismissed Civil Case No. Ceb-6917. It held that the
civil case "is actually in the nature of a quashal of the levy and the certificate of sale, a case
arising out of a dispute that was instituted by the previous employees of Inductocast before the
Department of Labor and Employment, Region 7."7 Citing Pucan vs. Bengzon, 155 SCRA 692
(1987), it held it had no jurisdiction over the case since the levy and sale "are connected with the
case within the exclusive jurisdiction of the Department of Labor and Employment."8
Petitioners questioned the dismissal of their Complaint to the respondent Court of Appeals,
through a petition for certiorari and preliminary injunction.9 The appellate court, in its impugned
Decision, denied the petition as it held:
To Our minds, the issue on what forum the case must be tried or heard is a
settled one. The Department of Labor is the agency upon which devolves the
jurisdiction over disputes emanating from and in relation with labor controversies
to the exclusion of the regular courts.
The issue in the case at bar concerns the levy of a property in pursuance to a
writ of execution, arising out of labor disputes. There can be no doubt that
jurisdiction pertains to the Department of Labor.
xxx xxx xxx
In the light of the factual antecedents and incidents that transpired in the hearing
of this case at bar, the (trial court) correctly ruled that indeed the Department of
Labor has jurisdiction over the case. Consequently, WE see no abuse of
discretion let alone a grave one, amounting to lack or in excess of its jurisdiction
correctible with a writ of certiorari.
Indeed, the issue of granting or denying a motion to dismiss is addressed to the
sound discretion of the court, and in the absence of a capricious and whimsical
exercise of power, certiorari will not lie.
Thus, this appeal where petitioners contend:
THE RESPONDENT APPELLATE COURT ERRED IN
HOLDING THAT THE DEPARTMENT OF LABOR HAS
JURISDICTION ON THE SUBJECT MATTER AND NATURE
OF THE CASE AS AGAINST THE CIVIL COURT.
We find merit in the appeal. Firstly, respondent court erred in holding that the trial court does not
have jurisdiction over the case filed by petitioners. It is at once evident that the Civil Case No.
Ceb-6917 is not a labor case. No employer-employee relationship exists between petitioners and
the other parties, and no issue is involved which may be resolved by reference to the Labor Code,
other labor statutes, or any collective bargaining agreement. Neither can we characterize
petitioner's action before the trial court as arising out of a labor dispute. It was not brought to
reverse or modify the judgment of the Department of Labor and Employment (DOLE). Neither did
it question the validity of, or pray for, the quashal of the writ of execution against Inductocast.
What is to be litigated in Civil Case No. Ceb-6917 is the issue of ownership over the Tipolo
properties. Clearly, it is the RTC and not the labor department which can take cognizance of the
case, as provided by B.P. Blg. 129 ("An Act Reorganizing the Judiciary, Appropriating Funds
Therefor, and For Other Purposes"), thus:
Sec. 19. Jurisdiction in civil case. — Regional Trial Courts shall exercise
exclusive original jurisdiction:
xxx xxx xxx
(2) In all civil actions which involve the title to, or possession of real property, or
any interest therein, except actions for forcible entry into and unlawful detainer of
lands or buildings, original jurisdiction over which is conferred upon Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts;
xxx xxx xxx
The action taken by petitioners before the RTC asserting their ownership over the levied
properties is mandated by Section 17, Rule 39 of the Revised Rules of Court. Time and again, we
have held that:
Under Section 17, Rule 39, a third person who claims property levied upon on
execution may vindicate such claim by action. . . . The right of a person who
claims to be the owner of property levied upon on execution to file a third-party
claim with the sheriff is not exclusive, and he may file an action to vindicate his
claim even if the judgment creditor files an indemnity bond in favor of the sheriff
to answer for any damages that may be suffered by the third-party claimant. By
"action", as stated in the Rule, what is meant is a separate and independent
action.10
Secondly, it is incorrect to argue that the trial court cannot take cognizance of Civil Case No. Ceb-
6917 without interfering with the writ of attachment and writ of execution of a co-equal body. It is
settled that the levy and sale of property by virtue of a writ of attachment is lawful only when the
levied property indubitably belongs to the defendant. If property other than those of the defendant
is attached and sold by the sheriff, he acts beyond the limits of his and the court's authority.11 In
this regard, we held in the case of Uy, Jr. vs. Court of Appeals, 191 SCRA 275 (1991) that:
The main issue in this case is whether or not properties levied and seized by
virtue of a writ of attachment and later by a writ of execution, were under custodia
legis and therefore not subject to the jurisdiction of another co-equal court where
a third party claimant claimed ownership of the same properties.
The issue has long been laid to rest in the case of Manila Herald Publishing
Co., Inc. v. Ramos (88 Phil. 94 [1951]) where the Court ruled that while it is true
that property in custody of the law may not be interfered with, without the
permission of the proper court, this rule is confined to cases where the property
belongs to the defendant or one in which the defendant has proprietary interests.
But when the Sheriff, acting beyond the bounds of his office seizes a stranger's
property, the rule does not apply and interference with his custody is not
interference with another court's order of attachment.
Also, in the more recent case of Santos vs. Bayhon, 199 SCRA 525 (1991), we stated, viz.:
The general rule that no court has the power to interfere by injunction with the
judgments or decrees of another court with concurrent or coordinate jurisdiction
possessing equal power to grant injunctive relief, applies only when no third-party
claimant is involved. . . . When a third party, or stranger to the action, asserts a
claim over the property levied upon, the claimant may vindicate his claim by an
independent action in the proper civil court which may stop the execution of the
judgment on property not belonging to the judgment debtor (Citations omitted.)
Finally, it must be noted that the Pucan case relied upon by respondent court is inapplicable to the
case at bench which involves a third-party claim over property levied on execution. In Pucan, we
enjoined the Regional Trial Court from acting on the petition for damages and prohibition against
the enforcement of the writ of execution issued by the NCR director of the then Ministry of Labor
and Employment in a labor case for the following reason:
A perusal of the petition for damages and prohibition filed by Saulog Transit, Inc.,
in the lower court reveals that basically, what was being questioned was the
legality or propriety of the alias writ of execution dated March 1, 1985, as well as
the acts performed by the Ministry officials in implementing the same. In other
words, the petition was actually in the nature of a motion to quash the writ; and
with respect to the acts of the Ministry officials, a case growing out of a labor
dispute, as the acts complained of, were perpetrated during the execution of a
decision of the then Minister of Labor and Employment. However characterized,
jurisdiction over the petition pertains to the Labor Ministry, now Department and
not the regular courts. This conclusion is evident, not only from the provisions of
Article 224(b) of the Labor Code, but also of
Article 218, as amended by Batas Pambansa Blg. 227 in connection with Article
255 of the same Code.
xxx xxx xxx
Apparently, Saulog Transit, Inc. was misled by its own prayer for actual, moral
and exemplary damages. It believed that such additional cause of action could
clothe the petition with the mantle of a regular action cognizable by the regular
 courts. It was, of course, mistaken for the fact remains that the acts complained
of are mere incidents of a labor dispute. Such prayer therefore did not alter the
complexion of the case as one arising from a labor dispute, but was subsumed
by the nature of the main case, over which the regular courts had no jurisdiction,
much less the power to issue a temporary or permanent injunction or restraining
order. . . .12

In fine, we prohibited the action before the trial court in Pucan because it attacked the regularity of
the issuance of the alias writ of execution in the labor case, which is but an incident of the labor
dispute. This is not so in the case at bench where the civil case filed by petitioners does not even
collaterally attack the validity of the DOLE's writ of attachment. On the contrary, petitioners in Civil
Case No. Ceb-6917 pray for the trial court's ruling that the DOLE's judgment could not be validly
executed on the Tipolo properties, which allegedly do not belong to Inductocast.

IN VIEW WHEREOF, the petition for review is GRANTED. The Decision of the Court of Appeals in
CA-G.R. SP No. 18017, dated November 16, 1989, is REVERSED and SET ASIDE. The Regional
Trial Court of Cebu City, Branch 8 is ordered to try Civil Case Ceb-6917 on its merit. No costs.

SO ORDERED.
 FIRST DIVISION
[A.M. No. RTJ-00-1574. March 28, 2001]
GORGONIO S. NOVA, complainant, vs. JUDGE SANCHO DAMES II, Regional Trial Court,
Branch 38, Daet, Camarines Norte, respondent.
RESOLUTION
PARDO, J.:
The case is a complaint[1] against Judge Sancho Dames II, presiding judge, Regional Trial
Court, Camarines Norte, Branch 38, Daet, in connection with his issuance of a temporary
restraining order in Civil Case No. 6859, entitled Sps. Cesar Barcelona and Vilma Jalgalado-
Barcelona vs. Hon. Fructuoso T. Aurellano, et al., restraining NLRC Sheriff Norberto B. Meteoro
from conducting the scheduled public auction of real property of Vilma J. Barcelona levied on
execution pursuant to a final decision of the NLRC in NLRC RAB V Case No. 05-12-00141-95,
entitled Gorgonio C. Nova, complainant, vs. R. A. Broadcasting Corporation,Vilma Jalgalado-
Barcelona and Deo N. Trinidad, respondents.
The complaint alleged that, in issuing the temporary restraining order, respondent judge
acted with gross ignorance of the law because regular courts had no jurisdiction to hear and
decide questions which arose and were incidental to decisions, orders or awards rendered in labor
cases.
The facts are as follows:
In 1995, complainant Gregorio S. Nova filed with the NLRC Regional Arbitration, Branch V,
Legaspi City, a complaint for illegal dismissal, underpayment of wages, non-payment of holiday
pay, rest day, overtime pay, 13th month pay and other allowances, backwages, separation pay
and damages against the R.A. Broadcasting Corporation/Station DZRM, represented by its Vice
President for Operations Vilma J. Barcelona and Station Manager Deo Trinidad. [2]
On July 31, 1996, Labor Arbiter Fructuoso T. Aurellano rendered a judgment, the dispositive
portion of which reads:
WHEREFORE, premises considered, judgment is hereby rendered ordering R. A.
BROADCASTING CORP./DZRM, VILMA J. BARCELONA and DEO TRINIDAD to solidarily pay
the complainant the total sum of ONE HUNDRED ELEVEN THOUSAND SIX HUNDRED SIXTY-
NINE PESOS and 60/100 (P111,669.60).
SO ORDERED.
In time, respondent appealed the decision to the NLRC in Quezon City.
On October 7, 1996, the NLRC dismissed the appeal. Respondent moved for reconsideration
but the NLRC denied the motion as it was filed out of time. Aggrieved by the resolution, on March
12, 1997, respondent filed with this Court a petition for certiorari.[3] On March 17, 1997, the Court
dismissed the petition and also denied the motion for reconsideration thereafter filed.
The decision having become final, on January 7, 1998, the NLRC issued an alias writ of
execution. Pursuant thereto, on February 3, 1998, Labor Sheriff Norberto B. Meteoro levied
on real property belonging to Sps. Cesar and Vilma Barcelona and scheduled the auction sale on
June 16, 1998, at 10:00 a. m.
On June 9, 1998, Vilma J. Barcelona and her husband Cesar Barcelona filed with the
Regional Trial Court, Camarines Norte, Daet a civil action for damages with temporary restraining
order due to the wrongful attachment of their property.[4] This was raffled to Branch 38, presided
over by respondent Judge.
On June 15, 1998, respondent Judge finding that there was extreme urgency and that
irreparable injury would result to the plaintiff before the matter can be heard on notice, issued a
temporary restraining order, restraining the NLRC Sheriff from conducting the scheduled public
auction on June 16, 1998.
Hence, on January 5, 1999, complainant filed this administrative charge against Judge
Sancho Dames II, alleging that the issuance of the temporary restraining order constituted a
violation of Article 254 of the Labor Code which prohibited the issuance of temporary restraining
order or preliminary injunction in a case arising from a labor dispute. He further submitted that the
regular courts had no jurisdiction to hear and decide questions which arose and were incidental to
the decisions, orders or awards rendered in labor cases.[5]
On April 28, 1999, the Court Administrator referred the complaint to respondent judge for
comment.[6]
In his answer filed on June 2, 1999, respondent judge claimed that he issued the temporary
restraining order to maintain the subject of controversy in status quo until the hearing of the
application for permanent injunction; that Vilma Jalgalado-Barcelona, Vice-President for
Operations, and Deo Trinidad, the Station Manager, were ordered to solidarily pay with the
defendant corporation despite the fact that the corporation had a distinct personality from its
officers; that Cesar Barcelona, not being a judgment debtor, would lose his property via public
auction for an alleged labor dispute he had nothing to do with; that injunction will lie to prevent
alienation of conjugal property; that all properties acquired during the marriage are presumed to
belong to the conjugal partnership property, thus the subject property belonged to the conjugal
partnership of spouses Cesar Barcelona and Vilma Jalgalado-Barcelona and could not be
alienated via public auction; that injunction to prevent a wrong would be favored than a course
requiring plaintiffs to wait and seek damages after the wrong had been done; and that the instant
case involved a judicial question and thus, should be dismissed.[7]
We referred the case to Court of Appeals Associate Justice Remedios A. Salazar-Fernando,
for investigation.[8]
In her report and recommendation, Justice Fernando found that respondent Judge was guilty
of gross ignorance of the law because the regular courts in that level had no jurisdiction or
authority to issue injunction or temporary restraining order in labor cases. She recommended that
respondent Judge be fined P10,000.00, with a stern warning that repetition of the same or similar
acts in the future would be dealt with more severely.
 We find the recommendation of Justice Salazar-Fernando to be supported by the record and
we accept the same.
Regular courts have no jurisdiction to hear and decide questions which arise and are
incidental to the enforcement of decisions, orders or awards rendered in labor cases by
appropriate officers and tribunals of the Department of Labor and Employment. [9] Corollarily, any
controversy in the execution of the judgment shall be referred to the tribunal which issued the writ
of execution since it has the inherent power to control its own processes in order to enforce its
judgments and orders.[10]
True, an action for damages lies within the jurisdiction[11] of a regional trial court.[12] However,
the regional trial court has no jurisdiction to issue a temporary restraining order in labor
cases. Indeed, the respondent Judge restrained the execution of a final decision of the labor
arbiter, which he can not lawfully do.
Justice Malcolm aptly described ideal judges as men who have a mastery of the principles of
law, who discharge their duties in accordance with law, who are permitted to perform the duties of
the office undeterred by outside influence, and who are independent and self-respecting human
units in a judicial system equal and coordinate to the other two departments of
government.[13] Those who wield the judicial gavel have the duty to study the laws and their latest
wrinkles. They owe it to the public to be legally knowledgeable with basic laws and principles, for
ignorance of the law is the bane of injustice.
WHEREFORE, the Court finds respondent Judge Sancho Dames II GUILTY of gross
ignorance of the law and imposes on him a FINE of Ten Thousand Pesos (P10,000.00), payable
within thirty (30) days from notice, with WARNING that a repetition of similar acts shall be dealt
with more severely.
SO ORDERED.
 THIRD DIVISION
G.R. No. 149578 April 10, 2003
EVELYN TOLOSA, petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, QWANA KAIUN (through its resident-agent,
FUMIO NAKAGAWA), ASIA BULK TRANSPORT PHILS. INC., PEDRO GARATE and MARIO
ASIS, respondents.
PANGANIBAN, J.:
As a rule, labor arbiters and the National Labor Relations Commission have no power or authority
to grant reliefs from claims that do not arise from employer-employee relations. They have no
jurisdiction over torts that have no reasonable causal connection to any of the claims provided for
in the Labor Code, other labor statutes, or collective bargaining agreements.
The Case
The Petition for Review before us assails the April 18, 2001 Decision1 of the Court of Appeals (CA)
in CA-GR SP No. 57660, as well as the April 17, 2001 CA Resolution 2 denying petitioner's Motion
for Reconsideration. The dispositive portion of the challenged Decision reads as follows:
"WHEREFORE, premises considered, the instant petition for certiorari is hereby DENIED
and accordingly DISMISSED, without prejudice to the right of herein petitioner to file a suit
before the proper court, if she so desires. No pronouncement as to costs."3
The Facts
The appellate court narrated the facts of the case in this manner:
"Evelyn Tolosa (hereafter EVELYN), was the widow of Captain Virgilio Tolosa (hereafter
CAPT. TOLOSA) who was hired by Qwana-Kaiun, through its manning agent, Asia Bulk
Transport Phils. Inc., (ASIA BULK for brevity), to be the master of the Vessel named M/V
Lady Dona. CAPT. TOLOSA had a monthly compensation of US$1700, plus US$400.00
monthly overtime allowance. His contract officially began on November 1, 1992, as
supported by his contract of employment when he assumed command of the vessel in
Yokohama, Japan. The vessel departed for Long Beach California, passing by Hawaii in
the middle of the voyage. At the time of embarkation, CAPT. TOLOSA was allegedly
shown to be in good health.
"During 'channeling activities' upon the vessel's departure from Yokohama sometime on
November 6, 1992, CAPT. TOLOSA was drenched with rainwater. The following day,
November 7, 1992, he had a slight fever and in the succeeding twelve (12) days, his
health rapidly deteriorated resulting in his death on November 18, 1992.
"According to Pedro Garate, Chief Mate of the Vessel, in his statement submitted to the
U.S. Coast Guard on November 23, 1992 upon arrival in Long Beach, California CAPT.
TOLOSA experienced high fever between November 11-15, 1992 and suffered from
loose bowel movement (LBM) beginning November 9, 1992. By November 11, 1992, his
temperature was 39.5 although his LBM had 'slightly' stopped. The next day, his
temperature rose to 39.8 and had lost his appetite. In the evening of that day, November
13, 1992, he slipped in the toilet and suffered scratches at the back of his waist. First aid
was applied and CAPT. TOLOSA was henceforth confined to his quarters with an able
seaman to watch him 24 hours a day until November 15, 1992, when his conditioned
worsened.
"On the same day, November 15, 1992, the Chief Engineer initiated the move and
contacted ASIA BULK which left CAPT. TOLOSA's fate in the hands of Pedro Garate and
Mario Asis, Second Mate of the same vessel who was in-charge of the primary medical
care of its officers and crew. Contact with the U.S. Coast Guard in Honolulu, Hawaii
(USCGHH) was likewise initiated to seek medical advice.
"On November 17, 1992, CAPT. TOLOSA was 'losing resistance' and his 'condition was
getting serious.' At 2215 GMT, a telex was sent to ASIA BULK requesting for the
immediate evacuation of CAPT. TOLOSA and thereafter an airlift was set on November
19, 1992. However, on November 18, 1992, at 0753 GMT, CAPT. TOLOSA was officially
recorded as having breathed his last.
"Because of the death of CAPT. TOLOSA, his wife, EVELYN, as petitioner, filed a
Complaint/Position Paper before the POEA (POEA Case No. 93-06-1080) against
Qwana-Kaiun, thru its resident-agent, Mr. Fumio Nakagawa, ASIA BULK, Pedro Garate
and Mario Asis, as respondents.
"After initial hearings and submissions of pleadings, the case was however transferred to
the Department of Labor and Employment, National Labor Relations Commission
(NLRC), when the amendatory legislation expanding its jurisdiction, and removing
overseas employment related claims from the ambit of POEA jurisdiction. The case was
then raffled to Labor Arbiter, Vladimir Sampang.
xxx xxx xxx
"After considering the pleadings and evidences, on July 8, 1997, the Labor Arbiter
Vladimir P. L. Sampang, in conformity with petitioner's plea to hold respondents solidarily
liable, granted all the damages, (plus legal interest), as prayed for by the petitioner. The
dispositive portion of his Decision reads:
'WHEREFORE, premises considered, the respondents are hereby ordered to
jointly and solidarily pay complainants the following:
1. US$176,400.00 (US$2,100.00 x 12 months x 7 years) or P4,586,400.00 (at
P26.00 per US$1.00) by way of lost income;
 2. interest at the legal rate of six percent (6%) per annum or P1,238,328.00 (from
November 1992 to May 1997 or 4 ½ years);
3. moral damages of P200,000.00;
4. exemplary damages of P100,000.00; and
5. 10% of the total award, or P612,472.80, as attorney's fees.'
xxx xxx xxx
"On appeal, private respondents raised before the National Labor Relations Commission
(NLRC) the following grounds:
(a) the action before the Arbiter, as he himself concedes, is a complaint based on
torts due to negligence. It is the regular courts of law which have jurisdiction over
the action;
(b) Labor Arbiters have jurisdiction over claims for damages arising from
employer-employee relationship (Art. 217, Section (a) (3));
(c) In this case, gross negligence is imputed to respondents Garate and Asis,
who have no employer-employee relationship with the late Capt. Virgilio Tolosa;
(d) The labor arbiter has no jurisdiction over the controversy;
xxx xxx xxx
"Despite other peripheral issues raised by the parties in their respective pleadings, the
NLRC on September 10, 1998, vacated the appealed decision dated July 8, 1997 of the
Labor Arbiter and dismissed petitioner's case for lack of jurisdiction over the subject
matter of the action pursuant to the provisions of the Labor Code, as
amended."4 (Citations omitted)
Ruling of the Court of Appeals
Sustaining the NLRC, the CA ruled that the labor commission had no jurisdiction over the subject
matter of the action filed by petitioner. Her cause did not arise from an employer-employee
relation, but from a quasi delict or tort. Further, there is no reasonable causal connection between
her suit for damages and her claim under Article 217 (a)(4) of the Labor Code, which allows an
award of damages incident to an employer-employee relation.
Hence, this Petition.5
Issues
Petitioner raises the following issues for our consideration:
"I
"Whether or not the NLRC has jurisdiction over the case.
"II
"Whether or not Evelyn is entitled to the monetary awards granted by the labor arbiter."6
After reviewing petitioner's Memorandum, we find that we are specifically being asked to
determine 1) whether the labor arbiter and the NLRC had jurisdiction over petitioner's action, and
2) whether the monetary award granted by the labor arbiter has already reached finality.
The Court's Ruling
The Petition has no merit.
First Issue:
Jurisdiction over the Action
Petitioner argues that her cause of action is not predicated on a quasi delict or tort, but on the
failure of private respondents -- as employers of her husband (Captain Tolosa) -- to provide him
with timely, adequate and competent medical services under Article 161 of the Labor Code:
"ART 161. Assistance of employer. -- It shall be the duty of any employer to provide all
the necessary assistance to ensure the adequate and immediate medical and dental
attendance and treatment to an injured or sick employee in case of emergency."
Likewise, she contends that Article 217 (a) (4)7 of the Labor Code vests labor arbiters and the
NLRC with jurisdiction to award all kinds of damages in cases arising from employer-employee
relations.
Petitioner also alleges that the "reasonable causal connection" rule should be applied in her favor.
Citing San Miguel Corporation v. Etcuban,8 she insists that a reasonable causal connection
between the claim asserted and the employer-employee relation confers jurisdiction upon labor
tribunals. She adds that she has satisfied the required conditions: 1) the dispute arose from an
employer-employee relation, considering that the claim was for damages based on the failure of
private respondents to comply with their obligation under Article 161 of the Labor Code; and 2) the
dispute can be resolved by reference to the Labor Code, because the material issue is whether
private respondents complied with their legal obligation to provide timely, adequate and competent
medical services to guarantee Captain Tolosa's occupational safety.9
We disagree. We affirm the CA's ruling that the NLRC and the labor arbiter had no jurisdiction
over petitioner's claim for damages, because that ruling was based on a quasi delict or tort per
Article 2176 of the Civil Code.10
Time and time again, we have held that the allegations in the complaint determine the nature of
the action and, consequently, the jurisdiction of the courts.11 After carefully examining the
complaint/position paper of petitioner, we are convinced that the allegations therein are in the
nature of an action based on a quasi delict or tort. It is evident that she sued Pedro Garate and
Mario Asis for gross negligence.
Petitioner's complaint/position paper refers to and extensively discusses the negligent acts of
shipmates Garate and Asis, who had no employer-employee relation with Captain Tolosa.
Specifically, the paper alleges the following tortious acts:
"x x x [R]espondent Asis was the medical officer of the Vessel, who failed to regularly
monitor Capt. Tolosa's condition, and who needed the USCG to prod him to take the
latter's vital signs. In fact, he failed to keep a medical record, like a patient's card or folder,
of Capt. Tolosa's illness."12
"Respondents, however, failed Capt. Tolosa because Garate never initiated actions to
save him. x x x In fact, Garate rarely checked personally on Capt. Tolosa's condition, to
wit:"13
"x x x Noticeably, the History (Annex "D") fails to mention any instance when Garate
consulted the other officers, much less Capt. Tolosa, regarding the possibility of deviation.
To save Capt. Tolosa's life was surely a just cause for the change in course, which the
other officers would have concurred in had they been consulted by respondent Garate –
which he grossly neglected to do.
"Garate's poor judgement, since he was the officer effectively in command of the vessel,
prevented him from undertaking these emergency measures, the neglect of which
resulted in Capt. Tolosa's untimely demise."14
The labor arbiter himself classified petitioner's case as "a complaint for damages, blacklisting and
watchlisting (pending inquiry) for gross negligence resulting in the death of complainant's
husband, Capt. Virgilio Tolosa."15
We stress that the case does not involve the adjudication of a labor dispute, but the recovery of
damages based on a quasi delict. The jurisdiction of labor tribunals is limited to disputes arising
from employer-employee relations, as we ruled in Georg Grotjahn GMBH & Co. v. Isnani:16
"Not every dispute between an employer and employee involves matters that only labor
arbiters and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial
powers. The jurisdiction of labor arbiters and the NLRC under Article 217 of the Labor
Code is limited to disputes arising from an employer-employee relationship which can
only be resolved by reference to the Labor Code, other labor statutes, or their collective
bargaining agreement."17
The pivotal question is whether the Labor Code has any relevance to the relief sought by
petitioner. From her paper, it is evident that the primary reliefs she seeks are as follows: (a) loss of
earning capacity denominated therein as "actual damages" or "lost income" and (b) blacklisting.
The loss she claims does not refer to the actual earnings of the deceased, but to his earning
capacity based on a life expectancy of 65 years. This amount is recoverable if the action is based
on a quasi delict as provided for in Article 2206 of the Civil Code,18 but not in the Labor Code.
While it is true that labor arbiters and the NLRC have jurisdiction to award not only reliefs provided
by labor laws, but also damages governed by the Civil Code,19 these reliefs must still he based on
an action that has a reasonable causal connection with the Labor Code, other labor statutes, or
collective bargaining agreements.20
The central issue is determined essentially from the relief sought in the complaint. In San Miguel
Corporation v. NLRC,21 this Court held:
"It is the character of the principal relief sought that appears essential in this connection.
Where such principal relief is to be granted under labor legislation or a collective
bargaining agreement, the case should fall within the jurisdiction of the Labor Arbiter and
the NLRC, even though a claim for damages might be asserted as an incident to such
claim."22
The labor arbiter found private respondents to be grossly negligent. He ruled that Captain Tolosa,
who died at age 58, could expect to live up to 65 years and to have an earning capacity of
US$176,400.
It must be noted that a worker's loss of earning capacity and blacklisting are not to be equated
with wages, overtime compensation or separation pay, and other labor benefits that are generally
cognized in labor disputes. The loss of earning capacity is a relief or claim resulting from a quasi
delict or a similar cause within the realm of civil law.
"Claims for damages under paragraph 4 of Article 217 must have a reasonable causal connection
with any of the claims provided for in the article in order to be cognizable by the labor arbiter. Only
if there is such a connection with the other claims can the claim for damages be considered as
arising from employer-employee relations."23 In the present case, petitioner's claim for damages is
not related to any other claim under Article 217, other labor statutes, or collective bargaining
agreements.
Petitioner cannot anchor her claim for damages to Article 161 of the Labor Code, which does not
grant or specify a claim or relief. This provision is only a safety and health standard under Book IV
of the same Code. The enforcement of this labor standard rests with the labor secretary. 24 Thus,
claims for an employer's violation thereof are beyond the jurisdiction of the labor arbiter. In other
words, petitioner cannot enforce the labor standard provided for in Article 161 by suing for
damages before the labor arbiter.
It is not the NLRC but the regular courts that have jurisdiction over actions for damages, in which
the employer-employee relation is merely incidental, and in which the cause of action proceeds
from a different source of obligation such as a tort.25 Since petitioner's claim for damages is
predicated on a quasi delict or tort that has no reasonable causal connection with any of the
claims provided for in Article 217, other labor statutes, or collective bargaining agreements,
jurisdiction over the action lies with the regular courts26 -- not with the NLRC or the labor arbiters.

Second Issue:
Finality of the Monetary Award

Petitioner contends that the labor arbiter's monetary award has already reached finality, since
private respondents were not able to file a timely appeal before the NLRC.

This argument cannot be passed upon in this appeal, because it was not raised in the tribunals a
quo. Well-settled is the rule that issues not raised below cannot be raised for the first time on
appeal. Thus, points of law, theories, and arguments not brought to the attention of the Court of
Appeals need not -- and ordinarily will not -- be considered by this Court.27 Petitioner's allegation
cannot be accepted by this Court on its face; to do so would be tantamount to a denial of
respondents' right to due process.28

Furthermore, whether respondents were able to appeal on time is a question of fact that cannot be
entertained in a petition for review under Rule 45 of the Rules of Court. In general, the jurisdiction
of this Court in cases brought before it from the Court of Appeals is limited to a review of errors of
law allegedly committed by the court a quo.29

WHEREFORE, the Petition is hereby DENIED, and the assailed Decision and Resolution
AFFIRMED. Costs against petitioner.

SO ORDERED.
 SECOND DIVISION
[G.R. No. 152121. July 29, 2003]
EDUARDO G. EVIOTA, petitioner, vs. THE HON. COURT OF APPEALS, THE HON. JOSE
BAUTISTA, Presiding Judge of Branch 136, Regional Trial Court of Makati, and
STANDARD CHARTERED BANK, respondents.
DECISION
CALLEJO, SR., J.:
Before us is a petition for review on certiorari under Rule 45 of the Revised Rules of Court, of
the Decision[1] of the Court of Appeals in CA-G.R. SP No. 60141 denying the petition for certiorari
filed by the petitioner praying the nullification of the Order of the Regional Trial Court of Makati,
Branch 136.[2]
Sometime on January 26, 1998, the respondent Standard Chartered Bank and petitioner
Eduardo G. Eviota executed a contract of employment under which the petitioner was employed
by the respondent bank as Compensation and Benefits Manager, VP (M21). However, the
petitioner abruptly resigned from the respondent bank barely a month after his employment and
rejoined his former employer.
On June 19, 1998, the respondent bank filed a complaint against the petitioner with the RTC
of Makati City. The respondent bank alleged inter alia in its complaint that:
1. It is a foreign banking institution authorized to do business in the Philippines, with principal
offices at the 5th Floor, Bankmer Bldg., 6756 Ayala Avenue, Makati City.
2. Defendant Eduardo Eviota (Eviota) is a former employee of the Bank, and may be served with
summons and other court processes at 8 Maple Street, Cottonwoods, Antipolo, Metro Manila.
3. On December 22, 1997, Eviota began negotiating with the Bank on his possible employment
with the latter. Taken up during these negotiations were not only his compensation and benefit
package, but also the nature and demands of his prospective position. The Bank made sure that
Eviota was fully aware of all the terms and conditions of his possible job with the Bank.
4. On January 26, 1998, Eviota indicated his conformity with the Banks Offer of Employment by
signing a written copy of such offer dated January 22, 1998 (the Employment Contract). A copy of
the Employment Contract between Eviota and the Bank is hereto attached as Annex A.
5. Acting on the Employment Contract and on Eviotas uninhibited display of interest in assuming
his position, the Bank promptly proceeded to carry out the terms of the Employment Contract as
well as to facilitate his integration into the workforce. Among others, the Bank: (a) renovated and
refurbished the room which was to serve as Eviotas office; (b) purchased a 1998 Honda CR-V
(Motor No. PEWED7P101101; Chassis No. PADRD 1830WV00108) for Eviotas use; (c)
purchased a desktop IBM computer for Eviotas use; (d) arranged the takeout of Eviotas loans with
Eviotas former employer; (e) released Eviotas signing bonus in the net amount of P300,000.00; (f)
booked Eviotas participation in a Singapore conference on Y2K project scheduled on March 10
and 11, 1998; and (g) introduced Eviota to the local and regional staff and officers of the Bank via
personal introductions and electronic mail.
6. The various expenses incurred by the Bank in carrying out the above acts are itemized below,
as follows:
a. Signing Bonus P 300,000.00
b. 1 Honda CR-V 800,000.00
c. IBM Desktop Computer 89,995.00
d. Office Reconfiguration 29,815.00
e. 2-Drawer Lateral File
Cabinet 13,200.00
f. 1 Officers Chair 31,539.00
g. 1 Guest Chair 2,200.00
h. 1 Hanging Shelf 2,012.00
i. Staff Loan Processing
Title Verification 375.00
Cost of Appraisal
Housing Loan 3,500.00
TOTAL P1,272,636.00
An itemized schedule of the above expenses incurred by the Bank is hereto attached as Annex B.
7. On February 25, 1998, Eviota assumed his position as Compensation and Benefits Manager
with the Bank and began to discharge his duties. At one Human Resources (HR) Committee
meeting held on March 3, 1998, Eviota energetically presented to senior management his projects
for the year, thus raising the latters expectations. The same day, Eviota instructed the Banks HR
Administrator to book him a flight for Singapore, where he was scheduled to participate in a Y2K
project on March 10 and 11, 1998. Confident of Eviotas professed commitment to the Bank, the
latter made the aforementioned airline booking for him. In addition, the Bank allowed Eviota
access to certain sensitive and confidential information and documents concerning the Banks
operations.
8. After leading the Bank to believe that he had come to stay, Eviota suddenly resigned his
employment with immediate effect to re-join his previous employer. His resignation, which did not
comply with the 30-day prior notice rule under the law and under the Employment Contract, was
so unexpected that it disrupted plans already in the pipeline (e.g., the development of a
salary/matrix grid and salary structure, and the processing of merit promotion recommendations),
aborted meetings previously scheduled among Bank officers, and forced the Bank to hire the
services of a third party to perform the job he was hired to do. For the services of this third party,
the Bank had to pay a total of P208,807.50. A copy of a receipt for the above expenses is hereto
attached as Annex C (See also, Annex B).
9. Aside from causing no small degree of chaos within the Bank by reason of his sudden
resignation, Eviota made off with a computer diskette and other papers and documents containing
confidential information on employee compensation and other Bank matters, such as the salary
schedule of all Corporate and Institutional Banking officers and photocopies of schedules of
benefits provided expatriates being employed by the Bank.
10. With the benefit of hindsight, the Bank realizes that it was simply used by Eviota as a mere
leverage for his selfish efforts at negotiating better terms of employment with his previous
employer. Worse, there is evidence to show that in his attempts to justify his hasty departure from
the Bank and conceal the real reason for his move, Eviota has resorted to falsehoods derogatory
to the reputation of the Bank. In particular, he has been maliciously purveying the canard that he
had hurriedly left the Bank because it had failed to provide him support. His untruthful remarks
have falsely depicted the Bank as a contract violator and an undesirable employer, thus damaging
the Banks reputation and business standing in the highly competitive banking community, and
undermining its ability to recruit and retain the best personnel in the labor market.
11. On March 16, 1998, the Bank made a written demand on Eviota to return the aforementioned
computer diskette and other confidential documents and papers, reimburse the Bank for the
various expenses incurred on his account as a result of his resignation (with legal interest), and
pay damages in the amount of at least P500,000.00 for the inconvenience and work/program
disruptions suffered by the Bank.
A copy of the Banks demand letter dated March 16, 1998 is hereto attached as Annex D.
12. In partial compliance with said demand, Eviota made arrangements with his previous employer
to reimburse the Bank for the expenses incurred in connection with the Banks purchase of the
Honda CR-V for his use.The Bank informed Eviota that in addition to the Honda CR-Vs purchase
price of P848,000.00 (of which Eviota initially shouldered P48,000.00), incidental costs in the form
of Processing Fees (P1,000.00), FPD/MCAR/98-155684 (P1,232.53) and Fund Transfer Price
(P18,646.84) were incurred, bringing the total cost of the Honda CR-V to P868,881.38. On April
29, 1998, the Bank received two managers checks in the aggregate amount of P868,881.38,
representing costs incurred in connection with the purchase of the Honda CR-V, inclusive of
processing fees and other incidental costs. Previously, Eviota had returned his P300,000.00
signing bonus, less the P48,000.00 he had advanced for the Honda CR-Vs purchase price.
13. Eviota never complied with the Banks demand that he reimburse the latter for the other
expenses incurred on his account, amounting to P360,562.12 (see, Annex B).[3]
The respondent bank alleged, by way of its causes of action against the petitioner, the
following:
First Cause of Action
14. Eviotas actions constitute a clear violation of Articles 19, 20 and 21 of Republic Act No. 386,
as amended (the Civil Code). Assuming arguendo that Eviota had the right to terminate his
employment with the Bank for no reason, the manner in and circumstances under which he
exercised the same are clearly abusive and contrary to the rules governing human relations.
14.1. By his actions and representations, Eviota had induced the Bank to believe that he was
committed to fulfilling his obligations under the Employment Contract. As a result, the Bank
incurred expenses in carrying out its part of the contract (see Annexes B and C). Less
reimbursements received from Eviota, the Bank is entitled to actual damages of
P360,562.12. (See, Annex C).
Second Cause of Action
15. Under Article 285 (a) of Presidential Decree No. 442, as amended (the Labor Code), an
employee may terminate without just cause the employer-employee relationship by serving written
notice on the employer at least one (1) month in advance. In addition, Section 13 of the
Employment Contract specifically provides that: Your [i.e., Eviotas] employment may be
terminated by either party giving notice of at least one month.(Annex A, p. 5.)
15.1. Eviotas failure to comply with the above requirement threw a monkey wrench into the Banks
operations Eviotas sudden resignation aborted meetings previously scheduled among Bank
officers and disrupted plans for a salary/merit review program and development of a salary
structure and merit grid already in the pipeline.
Hence, Eviota is liable to the Bank for damages in the amount of at least P100,000.00.
Third Cause of Action
16. Eviotas false and derogatory statements that the Bank had failed to deliver what it had
purportedly promised have besmirched the Banks reputation and depicted it as a contract violator
and one which does not treat its employees properly. These derogatory statements have injured
the Banks business standing in the banking community, and have undermined the Banks ability to
recruit and retain the best personnel. Hence, plaintiff is entitled to moral damages of at least
P2,000,000.00.
17. By way of example or correction for the public good, and to deter other parties from committing
similar acts in the future, defendant should be held liable for exemplary damages of at least
P1,000,000.00
18. Eviotas actions have compelled plaintiff to obtain the services of undersigned counsel for a
fee, in order to protect its interests. Hence, plaintiff is entitled to attorneys fees of at least
P200,000.00.[4]
The respondent bank prayed, that after due proceedings, judgment be rendered in its favor
as follows:
WHEREFORE, it is respectfully prayed that judgment be rendered ordering the defendant to pay
the plaintiff:
1. As actual damages, the amount of P360,562.12, representing expenses referred to in items c to
i of par. 6 and the cost of the third-party services mentioned in par. 8;
2. For violating the 30-day notice requirement under the Labor Code and order (sic) the
Employment Contract, damages in the amount of at least P100,000.00;
3. As moral damages, the amount of P2,000,000.00;
4. As exemplary damages, the amount of P1,000,000.00;
5. As attorneys fees, the amount of P200,000.00; and
6. Costs of the suit.
Other just and equitable reliefs are likewise prayed for.[5]
The respondent bank appended to its complaint a copy of the petitioners employment
contract.
The petitioner filed a motion to dismiss the complaint on the ground that the action for
damages of the respondent bank was within the exclusive jurisdiction of the Labor Arbiter under
paragraph 4, Article 217 of the Labor Code of the Philippines, as amended. The petitioner averred
that the respondent banks claim for damages arose out of or were in connection with his
employer-employee relationship with the respondent bank or some aspect or incident of such
relationship. The respondent bank opposed the motion, claiming that its action for damages was
within the exclusive jurisdiction of the trial court. Although its claims for damages incidentally
involved an employer-employee relationship, the said claims are actually predicated on the
petitioners acts and omissions which are separately, specifically and distinctly governed by the
New Civil Code.
On November 29, 1999, the trial court issued an order denying the petitioners motion to
dismiss, ratiocinating that the primary relief prayed for by the respondent bank was grounded on
the tortious manner by which the petitioner terminated his employment with the latter, and as such
is governed by the New Civil Code:
The Court holds that here, since the primary relief prayed for by the plaintiff is for damages,
grounded on the tortious manner by which the defendant terminated his employment with the
company, the same are recoverable under the applicable provision of the Civil Code, the present
controversy is removed from the jurisdiction of the Labor Arbiter and brings in within the purview of
the regular courts.[6]
The petitioner filed a motion for reconsideration of the said order, but the court issued an
order denying the same. The petitioner filed a petition for certiorari with the Court of Appeals for
the nullification of the orders of the trial court, alleging that the court a quo committed grave abuse
of its discretion amounting to excess or lack of jurisdiction in issuing the said orders. The petitioner
further asserted that contrary to the ruling of the court, the respondent bank claimed damages in
its complaint against the petitioner based on his employment contract, and not on tortious acts.
On November 15, 2001, the CA promulgated a decision dismissing the petition, holding that
the trial court and not the Labor Arbiter had exclusive jurisdiction over the action of the respondent
bank. It held that the latters claims for damages were grounded on the petitioners sudden and
unceremonious severance of his employment with the respondent bank barely a month after
assuming office.
With his motion for reconsideration of the decision having been denied by the CA, the
petitioner filed his petition with this Court contending that:
Suffice to state immediately that on the basis of the allegations in the complaint, it is the Labor
Arbiter, not the Regional Trial Court, which has jurisdiction of the subject matter of the complaint in
Civil Case No. 98-1397, the principal cause of action being the alleged omission of petitioner in
giving notice to the respondent Bank employer of termination of their relationship; whereas the
claims for other actual/moral/exemplary damages are well within the competence of the Labor
Arbiter.[7]
The petition is barren of merit.
Article 217 of the Labor Code of the Philippines, as amended by Rep. Act No. 6715 which
took effect on March 21, 1989 reads:
ART. 217. Jurisdiction of Labor Arbiters and the Commission.(a) Except as otherwise provided
under this Code the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide
within thirty (30) calendar days after the submission of the case by the parties for decision without
extension, even in the absence of stenographic notes, the following cases involving all workers,
whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers may file involving
wages, rates of pay, hours of work and other terms and conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-
employee relations.
Case law has it that the nature of an action and the subject matter thereof, as well as which
court has jurisdiction over the same, are determined by the material allegations of the complaint
and the reliefs prayed for in relation to the law involved.
Not every controversy or money claim by an employee against the employer or vice-versa is
within the exclusive jurisdiction of the labor arbiter. A money claim by a worker against the
employer or vice-versa is within the exclusive jurisdiction of the labor arbiter only if there is a
reasonable causal connection between the claim asserted and employee-employer
relation. Absent such a link, the complaint will be cognizable by the regular courts of justice. [8]
Actions between employees and employer where the employer-employee relationship is
merely incidental and the cause of action precedes from a different source of obligation is within
the exclusive jurisdiction of the regular court.[9] In Georg Grotjahn GMBH & Co. v. Isnani,[10] we
held that the jurisdiction of the Labor Arbiter under Article 217 of the Labor Code, as amended, is
limited to disputes arising from an employer-employee relationship which can only be resolved by
reference to the Labor Code of the Philippines, other labor laws or their collective bargaining
agreements. In Singapore Airlines Limited v. Pao,[11] the complaint of the employer against the
employee for damages for wanton justice and refusal without just cause to report for duty, and for
having maliciously and with bad faith violated the terms and conditions of their agreement for a
course of conversion training at the expense of the employer, we ruled that jurisdiction over the
action belongs to the civil court:
On appeal to this court, we held that jurisdiction over the controversy belongs to the civil
courts. We stated that the action was for breach of a contractual obligation, which is intrinsically a
civil dispute. We further stated that while seemingly the cause of action arose from employer-
employee relations, the employers claim for damages is grounded on wanton failure and refusal
without just cause to report to duty coupled with the averment that the employee maliciously and
with bad faith violated the terms and conditions of the contract to the damage of the
employer. Such averments removed the controversy from the coverage of the Labor Code of the
Philippines and brought it within the purview of the Civil Law.
Jurisprudence has evolved the rule that claims for damages under paragraph 4 of Article 217, to
be cognizable by the Labor Arbiter, must have a reasonable causal connection with any of the
claims provided for in that article. Only if there is such a connection with the other claims can the
claim for damages be considered as arising from employer-employee relations.[12]
The claims were the natural consequences flowing from a breach of an obligation,
intrinsically civil in nature.
In Medina v. Castro-Bartolome,[13] we held that a complaint of an employee for damages
against the employer for slanderous remarks made against him was within the exclusive
jurisdiction of the regular courts of justice because the cause of action of the plaintiff was for
damages for tortious acts allegedly committed by the employer. The fact that there was between
the parties an employer-employee relationship does not negate the jurisdiction of the trial court.
In Singapore Airlines Ltd. v. Pao,[14] we held that:
Stated differently, petitioner seeks protection under the civil laws and claims no benefits under the
Labor Code. The primary relief sought is for liquidated damages for breach of a contractual
obligation. The other items demanded are not labor benefits demanded by workers generally
taken cognizance of in labor disputes, such as payment of wages, overtime compensation or
separation pay. The items claimed are the natural consequences flowing from breach of an
obligation, intrinsically a civil dispute.
In Dai-Chi Electronics Manufacturing Corporation v. Villarama, Jr.,[15] the petitioner sued its
employee Adonis Limjuco for breach of contract which reads:
That for a period of two (2) years after termination of service from EMPLOYER, EMPLOYEE shall
not in any manner be connected, and/or employed, be a consultant and/or be an informative body
directly or indirectly, with any business firm, entity or undertaking engaged in a business similar to
or in competition with that of the EMPLOYER.[16]
The petitioner alleged in its complaint with the trial court that:
Petitioner claimed that private respondent became an employee of Angel Sound Philippines
Corporation, a corporation engaged in the same line of business as that of petitioner, within two
years from January 30, 1992, the date of private respondents resignation from petitioners
employ. Petitioner further alleged that private respondent is holding the position of Head of the
Material Management Control Department, the same position he held while in the employ of
petitioner.[17]
The trial court dismissed the case for lack of jurisdiction over the subject matter because the
cause of action for damages arose out of the parties employer-employee relationship. We
reversed the order of the trial court and held, thus:
Petitioner does not ask for any relief under the Labor Code of the Philippines. It seeks to recover
damages agreed upon in the contract as redress for private respondents breach of his contractual
obligation to its damage and prejudice (Rollo, p. 57). Such cause of action is within the realm of
Civil Law, and jurisdiction over the controversy belongs to the regular courts. More so when we
consider that the stipulation refers to the post-employment relations of the parties.[18]
In this case, the private respondents first cause of action for damages is anchored on the
petitioners employment of deceit and of making the private respondent believe that he would fulfill
his obligation under the employment contract with assiduousness and earnestness. The
petitioner volte face when, without the requisite thirty-day notice under the contract and the Labor
Code of the Philippines, as amended, he abandoned his office and rejoined his former employer;
thus, forcing the private respondent to hire a replacement. The private respondent was left in a
lurch, and its corporate plans and program in jeopardy and disarray. Moreover, the petitioner took
off with the private respondents computer diskette, papers and documents containing confidential
information on employee compensation and other bank matters. On its second cause of action,
the petitioner simply walked away from his employment with the private respondent sans any
written notice, to the prejudice of the private respondent, its banking operations and the conduct of
its business. Anent its third cause of action, the petitioner made false and derogatory statements
that the private respondent reneged on its obligations under their contract of employment; thus,
depicting the private respondent as unworthy of trust.
It is evident that the causes of action of the private respondent against the petitioner do not
involve the provisions of the Labor Code of the Philippines and other labor laws but the New Civil
Code. Thus, the said causes of action are intrinsically civil. There is no causal relationship
between the causes of action of the private respondents causes of action against the petitioner
and their employer-employee relationship. The fact that the private respondent was the erstwhile
employer of the petitioner under an existing employment contract before the latter abandoned his
employment is merely incidental. In fact, the petitioner had already been replaced by the private
respondent before the action was filed against the petitioner.
 IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED. The Decision of the Court of
Appeals dismissing the petition of the petitioner is AFFIRMED.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 154830 June 8, 2007
PIONEER CONCRETE PHILIPPINES, INC., PIONEER PHILIPPINES HOLDINGS, and PHILIP J.
KLEPZIG, petitioners,
vs.
ANTONIO D. TODARO, respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
Before the Court is a Petition for Review on Certiorari seeking to annul and set aside the
Decision1 of the Court of Appeals (CA) dated October 31, 2000 in CA-G.R. SP No. 54155 and its
Resolution2 of August 21, 2002 denying petitioners’ Motion for Reconsideration.
The factual and procedural antecedents of the case are as follows:
On January 16, 1998, herein respondent Antonio D. Todaro (Todaro) filed with the Regional Trial
Court (RTC) of Makati City, a complaint for Sum of Money and Damages with Preliminary
Attachment against Pioneer International Limited (PIL), Pioneer Concrete Philippines, Inc. (PCPI),
Pioneer Philippines Holdings, Inc. (PPHI), John G. McDonald (McDonald) and Philip J. Klepzig
(Klepzig).3
In his complaint, Todaro alleged that PIL is a corporation duly organized and existing under the
laws of Australia and is principally engaged in the ready-mix concrete and concrete aggregates
business; PPHI is the company established by PIL to own and hold the stocks of its operating
company in the Philippines; PCPI is the company established by PIL to undertake its business of
ready-mix concrete, concrete aggregates and quarrying operations in the Philippines; McDonald is
the Chief Executive of the Hongkong office of PIL; and, Klepzig is the President and Managing
Director of PPHI and PCPI; Todaro has been the managing director of Betonval Readyconcrete,
Inc. (Betonval), a company engaged in pre-mixed concrete and concrete aggregate production; he
resigned from Betonval in February 1996; in May 1996, PIL contacted Todaro and asked him if he
was available to join them in connection with their intention to establish a ready-mix concrete plant
and other related operations in the Philippines; Todaro informed PIL of his availability and interest
to join them; subsequently, PIL and Todaro came to an agreement wherein the former consented
to engage the services of the latter as a consultant for two to three months, after which, he would
be employed as the manager of PIL's ready-mix concrete operations should the company decide
to invest in the Philippines; subsequently, PIL started its operations in the Philippines; however, it
refused to comply with its undertaking to employ Todaro on a permanent basis.4
Instead of filing an Answer, PPHI, PCPI and Klepzig separately moved to dismiss the complaint on
the grounds that the complaint states no cause of action, that the RTC has no jurisdiction over the
subject matter of the complaint, as the same is within the jurisdiction of the NLRC, and that the
complaint should be dismissed on the basis of the doctrine of forum non conveniens.5
In its Order dated January 4, 1999, the RTC of Makati, Branch 147, denied herein petitioners'
respective motions to dismiss.6 Herein petitioners, as defendants, filed an Urgent Omnibus
Motion7 for the reconsideration of the trial court's Order of January 4, 1999 but the trial court
denied it via its Order8 dated June 3, 1999.
On August 3, 1999, herein petitioners filed a Petition for Certiorari with the CA.9 On October 31,
2000, the CA rendered its presently assailed Decision denying herein petitioners' Petition
for Certiorari. Petitioners filed a Motion for Reconsideration but the CA denied it in its Resolution
dated August 21, 2002.
Hence, herein Petition for Review on Certiorari based on the following assignment of errors:
A.
THE COURT OF APPEALS' CONCLUSION THAT THE COMPLAINT STATES A CAUSE
OF ACTION AGAINST PETITIONERS IS WITHOUT ANY LEGAL BASIS. THE
ANNEXES TO THE COMPLAINT CLEARLY BELIE THE ALLEGATION OF EXISTENCE
OF AN EMPLOYMENT CONTRACT BETWEEN PRIVATE RESPONDENT AND
PETITIONERS.
B.
THE COURT OF APPEALS DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT
IN ACCORD WITH LAW AND WITH APPLICABLE DECISIONS OF THE SUPREME
COURT WHEN IT UPHELD THE JURISDICTION OF THE TRIAL COURT DESPITE THE
FACT THAT THE COMPLAINT INDUBITABLY SHOWS THAT IT IS AN ACTION FOR
AN ALLEGED BREACH OF EMPLOYMENT CONTRACT, AND HENCE, FALLS WITHIN
THE EXLCUSIVE JURISDICTION OF THE NATIONAL LABOR RELATIONS
COMMISSION.
C
THE COURT OF APPEALS DISREGARDED AND FAILED TO CONSIDER THE
PRINCIPLE OF "FORUM NON CONVENIENS" AS A VALID GROUND FOR
DISMISSING A COMPLAINT.10
In their first assigned error, petitioners contend that there was no perfected employment contract
between PIL and herein respondent. Petitioners assert that the annexes to respondent's complaint
show that PIL's offer was for respondent to be employed as the manager only of its pre-mixed
concrete operations and not as the company's managing director or CEO. Petitioners argue that
when respondent reiterated his intention to become the manager of PIL's overall business venture
in the Philippines, he, in effect did not accept PIL's offer of employment and instead made a
counter-offer, which, however, was not accepted by PIL. Petitioners also contend that under
Article 1318 of the Civil Code, one of the requisites for a contract to be perfected is the consent of
the contracting parties; that under Article 1319 of the same Code, consent is manifested by the
meeting of the offer and the acceptance upon the thing and the cause which are to constitute the
contract; that the offer must be certain and the acceptance absolute; that a qualified acceptance
constitutes a counter-offer. Petitioners assert that since PIL did not accept respondent's counter-
offer, there never was any employment contract that was perfected between them.
Petitioners further argue that respondent's claim for damages based on the provisions of Articles
19 and 21 of the Civil Code is baseless because it was shown that there was no perfected
employment contract.
Assuming, for the sake of argument, that PIL may be held liable for breach of employment
contract, petitioners contend that PCPI and PPHI, may not also be held liable because they are
juridical entities with personalities which are separate and distinct from PIL, even if they are
subsidiary corporations of the latter. Petitioners also aver that the annexes to respondent's
complaint show that the negotiations on the alleged employment contract took place between
respondent and PIL through its office in Hongkong. In other words, PCPI and PPHI were not privy
to the negotiations between PIL and respondent for the possible employment of the latter; and
under Article 1311 of the Civil Code, a contract is not binding upon and cannot be enforced
against one who was not a party to it even if he be aware of such contract and has acted with
knowledge thereof.
Petitioners further assert that petitioner Klepzig may not be held liable because he is simply acting
in his capacity as president of PCPI and PPHI and settled is the rule that an officer of a
corporation is not personally liable for acts done in the performance of his duties and within the
bounds of the authority conferred on him. Furthermore, petitioners argue that even if PCPI and
PPHI are held liable, respondent still has no cause of action against Klepzig because PCPI and
PPHI have personalities which are separate and distinct from those acting in their behalf, such as
Klepzig.
As to their second assigned error, petitioners contend that since herein respondent's claims for
actual, moral and exemplary damages are solely premised on the alleged breach of employment
contract, the present case should be considered as falling within the exclusive jurisdiction of the
NLRC.
With respect to the third assigned error, petitioners assert that the principle of forum non
conveniens dictates that even where exercise of jurisidiction is authorized by law, courts may
refuse to entertain a case involving a foreign element where the matter can be better tried and
decided elsewhere, either because the main aspects of the case transpired in a foreign jurisdiction
or the material witnesses have their residence there and the plaintiff sought the forum merely to
secure procedural advantage or to annoy or harass the defendant. Petitioners also argue that one
of the factors in determining the most convenient forum for conflicts problem is the power of the
court to enforce its decision. Petitioners contend that since the majority of the defendants in the
present case are not residents of the Philippines, they are not subject to compulsory processes of
the Philippine court handling the case for purposes of requiring their attendance during trial. Even
assuming that they can be summoned, their appearance would entail excessive costs. Petitioners
further assert that there is no allegation in the complaint from which one can conclude that the
evidence to be presented during the trial can be better obtained in the Philippines. Moreover, the
events which led to the present controversy occurred outside the Philippines. Petitioners conclude
that based on the foregoing factual circumstances, the case should be dismissed under the
principle of forum non conveniens.
In his Comment, respondent extensively quoted the assailed CA Decision maintaining that the
factual allegations in the complaint determine whether or not the complaint states a cause of
action.
As to the question of jurisdiction, respondent contends that the complaint he filed was not based
on a contract of employment. Rather, it was based on petitioners' unwarranted breach of their
contractual obligation to employ respondent. This breach, respondent argues, gave rise to an
action for damages which is cognizable by the regular courts.
Even assuming that there was an employment contract, respondent asserts that for the NLRC to
acquire jurisdiction, the claim for damages must have a reasonable causal connection with the
employer-employee relationship of petitioners and respondent.
Respondent further argues that there is a perfected contract between him and petitioners as they
both agreed that the latter shall employ him to manage and operate their ready-mix concrete
operations in the Philippines. Even assuming that there was no perfected contract, respondent
contends that his complaint alleges an alternative cause of action which is based on the provisions
of Articles 19 and 21 of the Civil Code.
As to the applicability of the doctrine of forum non conveniens, respondent avers that the question
of whether a suit should be entertained or dismissed on the basis of the principle of forum non
conveniens depends largely upon the facts of the particular case and is addressed to the sound
discretion of the trial judge, who is in the best position to determine whether special circumstances
require that the court desist from assuming jurisdiction over the suit.
The petition lacks merit.
Section 2, Rule 2 of the Rules of Court, as amended, defines a cause of action as the act or
omission by which a party violates a right of another. A cause of action exists if the following
elements are present: (1) a right in favor of the plaintiff by whatever means and under whatever
law it arises or is created; (2) an obligation on the part of the named defendant to respect or not to
violate such right; and, (3) an act or omission on the part of such defendant violative of the right of
the plaintiff or constituting a breach of the obligation of the defendant to the plaintiff for which the
latter may maintain an action for recovery of damages.11
In Hongkong and Shanghai Banking Corporation Limited v. Catalan,12 this Court held:
The elementary test for failure to state a cause of action is whether the complaint alleges
facts which if true would justify the relief demanded. Stated otherwise, may the court
render a valid judgment upon the facts alleged therein? The inquiry is into the sufficiency,
 not the veracity of the material allegations. If the allegations in the complaint furnish
sufficient basis on which it can be maintained, it should not be dismissed regardless of
the defense that may be presented by the defendants.13
Moreover, the complaint does not have to establish or allege facts proving the existence of a
cause of action at the outset; this will have to be done at the trial on the merits of the case. 14 To
sustain a motion to dismiss for lack of cause of action, the complaint must show that the claim for
relief does not exist, rather than that a claim has been defectively stated, or is ambiguous,
indefinite or uncertain.15
Hence, in resolving whether or not the Complaint in the present case states a cause of action, the
trial court correctly limited itself to examining the sufficiency of the allegations in the Complaint as
well as the annexes thereto. It is proscribed from inquiring into the truth of the allegations in the
Complaint or the authenticity of any of the documents referred or attached to the Complaint, since
these are deemed hypothetically admitted by the respondent.
This Court has reviewed respondent’s allegations in its Complaint. In a nutshell, respondent
alleged that herein petitioners reneged on their contractual obligation to employ him on a
permanent basis. This allegation is sufficient to constitute a cause of action for damages.
The issue as to whether or not there was a perfected contract between petitioners and respondent
is a matter which is not ripe for determination in the present case; rather, this issue must be taken
up during trial, considering that its resolution would necessarily entail an examination of the
veracity of the allegations not only of herein respondent as plaintiff but also of petitioners as
defendants.
The Court does not agree with petitioners' contention that they were not privy to the negotiations
for respondent's possible employment. It is evident from paragraphs 24 to 28 of the
Complaint16 that, on various occasions, Klepzig conducted negotiations with respondent regarding
the latter's possible employment. In fact, Annex "H"17 of the complaint shows that it was Klepzig
who informed respondent that his company was no longer interested in employing respondent.
Hence, based on the allegations in the Complaint and the annexes attached thereto, respondent
has a cause of action against herein petitioners.
As to the question of jurisdiction, this Court has consistently held that where no employer-
employee relationship exists between the parties and no issue is involved which may be resolved
by reference to the Labor Code, other labor statutes or any collective bargaining agreement, it is
the Regional Trial Court that has jurisdiction.18 In the present case, no employer-employee
relationship exists between petitioners and respondent. In fact, in his complaint, private
respondent is not seeking any relief under the Labor Code, but seeks payment of damages on
account of petitioners' alleged breach of their obligation under their agreement to employ him. It is
settled that an action for breach of contractual obligation is intrinsically a civil dispute. 19 In the
alternative, respondent seeks redress on the basis of the provisions of Articles 19 and 21 of the
Civil Code. Hence, it is clear that the present action is within the realm of civil law, and jurisdiction
over it belongs to the regular courts.20
With respect to the applicability of the principle of forum non conveniens in the present case, this
Court's ruling in Bank of America NT & SA v. Court of Appeals21 is instructive, to wit:
The doctrine of forum non conveniens, literally meaning ‘the forum is inconvenient’,
emerged in private international law to deter the practice of global forum shopping, that is
to prevent non-resident litigants from choosing the forum or place wherein to bring their
suit for malicious reasons, such as to secure procedural advantages, to annoy and harass
the defendant, to avoid overcrowded dockets, or to select a more friendly venue. Under
this doctrine, a court, in conflicts of law cases, may refuse impositions on its jurisdiction
where it is not the most "convenient" or available forum and the parties are not precluded
from seeking remedies elsewhere.
Whether a suit should be entertained or dismissed on the basis of said doctrine depends
largely upon the facts of the particular case and is addressed to the sound discretion of
the trial court. In the case of Communication Materials and Design, Inc. vs. Court of
Appeals, this Court held that "xxx [a] Philippine Court may assume jurisdiction over the
case if it chooses to do so; provided, that the following requisites are met: (1) that the
Philippine Court is one to which the parties may conveniently resort to; (2) that the
Philippine Court is in a position to make an intelligent decision as to the law and the facts;
and, (3) that the Philippine Court has or is likely to have power to enforce its decision."
Moreover, this Court enunciated in Philsec. Investment Corporation vs. Court of Appeals,
that the doctrine of forum non conveniens should not be used as a ground for a
motion to dismiss because Sec. 1, Rule 16 of the Rules of Court does not include
said doctrine as a ground. This Court further ruled that while it is within the
discretion of the trial court to abstain from assuming jurisdiction on this ground, it
should do so only after vital facts are established, to determine whether special
circumstances require the court’s desistance; and that the propriety of dismissing
a case based on this principle of forum non conveniens requires a factual
determination, hence it is more properly considered a matter of
defense.22 (emphasis supplied)
In the present case, the factual circumstances cited by petitioners which would allegedly justify the
application of the doctrine of forum non conveniens are matters of defense, the merits of which
should properly be threshed out during trial.
WHEREFORE, the instant petition is DENIED and the assailed Decision and Resolution of the
Court of Appeals are AFFIRMED.
Costs against petitioners.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 157802 October 13, 2010
MATLING INDUSTRIAL AND COMMERCIAL CORPORATION, RICHARD K. SPENCER,
CATHERINE SPENCER, AND ALEX MANCILLA, Petitioners,
vs.
RICARDO R. COROS, Respondent.
DECISION
BERSAMIN, J.:
This case reprises the jurisdictional conundrum of whether a complaint for illegal dismissal is
cognizable by the Labor Arbiter (LA) or by the Regional Trial Court (RTC). The determination of
whether the dismissed officer was a regular employee or a corporate officer unravels the
conundrum. In the case of the regular employee, the LA has jurisdiction; otherwise, the RTC
exercises the legal authority to adjudicate.
In this appeal via petition for review on certiorari, the petitioners challenge the decision dated
September 13, 20021and the resolution dated April 2, 2003,2 both promulgated in C.A.-G.R. SP
No. 65714 entitled Matling Industrial and Commercial Corporation, et al. v. Ricardo R. Coros and
National Labor Relations Commission, whereby by the Court of Appeals (CA) sustained the ruling
of the National Labor Relations Commission (NLRC) to the effect that the LA had jurisdiction
because the respondent was not a corporate officer of petitioner Matling Industrial and
Commercial Corporation (Matling).
Antecedents
After his dismissal by Matling as its Vice President for Finance and Administration, the respondent
filed on August 10, 2000 a complaint for illegal suspension and illegal dismissal against Matling
and some of its corporate officers (petitioners) in the NLRC, Sub-Regional Arbitration Branch XII,
Iligan City.3
The petitioners moved to dismiss the complaint,4 raising the ground, among others, that the
complaint pertained to the jurisdiction of the Securities and Exchange Commission (SEC) due to
the controversy being intra-corporate inasmuch as the respondent was a member of Matling’s
Board of Directors aside from being its Vice-President for Finance and Administration prior to his
termination.
The respondent opposed the petitioners’ motion to dismiss,5 insisting that his status as a member
of Matling’s Board of Directors was doubtful, considering that he had not been formally elected as
such; that he did not own a single share of stock in Matling, considering that he had been made to
sign in blank an undated indorsement of the certificate of stock he had been given in 1992; that
Matling had taken back and retained the certificate of stock in its custody; and that even assuming
that he had been a Director of Matling, he had been removed as the Vice President for Finance
and Administration, not as a Director, a fact that the notice of his termination dated April 10, 2000
showed.
On October 16, 2000, the LA granted the petitioners’ motion to dismiss,6 ruling that the respondent
was a corporate officer because he was occupying the position of Vice President for Finance and
Administration and at the same time was a Member of the Board of Directors of Matling; and that,
consequently, his removal was a corporate act of Matling and the controversy resulting from such
removal was under the jurisdiction of the SEC, pursuant to Section 5, paragraph (c) of Presidential
Decree No. 902.
Ruling of the NLRC
The respondent appealed to the NLRC,7 urging that:
I
THE HONORABLE LABOR ARBITER COMMITTED GRAVE ABUSE OF DISCRETION
GRANTING APPELLEE’S MOTION TO DISMISS WITHOUT GIVING THE APPELLANT AN
OPPORTUNITY TO FILE HIS OPPOSITION THERETO THEREBY VIOLATING THE BASIC
PRINCIPLE OF DUE PROCESS.
II
THE HONORABLE LABOR ARBITER COMMITTED AN ERROR IN DISMISSING THE CASE
FOR LACK OF JURISDICTION.
On March 13, 2001, the NLRC set aside the dismissal, concluding that the respondent’s complaint
for illegal dismissal was properly cognizable by the LA, not by the SEC, because he was not a
corporate officer by virtue of his position in Matling, albeit high ranking and managerial, not being
among the positions listed in Matling’s Constitution and By-Laws.8 The NLRC disposed thuswise:
WHEREFORE, the Order appealed from is SET ASIDE. A new one is entered declaring and
holding that the case at bench does not involve any intracorporate matter. Hence, jurisdiction to
hear and act on said case is vested with the Labor Arbiter, not the SEC, considering that the
position of Vice-President for Finance and Administration being held by complainant-appellant is
not listed as among respondent's corporate officers.
Accordingly, let the records of this case be REMANDED to the Arbitration Branch of origin in order
that the Labor Arbiter below could act on the case at bench, hear both parties, receive their
respective evidence and position papers fully observing the requirements of due process, and
resolve the same with reasonable dispatch.
SO ORDERED.
The petitioners sought reconsideration,9 reiterating that the respondent, being a member of the
Board of Directors, was a corporate officer whose removal was not within the LA’s jurisdiction.
The petitioners later submitted to the NLRC in support of the motion for reconsideration the
certified machine copies of Matling’s Amended Articles of Incorporation and By Laws to prove that
the President of Matling was thereby granted "full power to create new offices and appoint the
officers thereto, and the minutes of special meeting held on June 7, 1999 by Matling’s Board of
Directors to prove that the respondent was, indeed, a Member of the Board of Directors.10
Nonetheless, on April 30, 2001, the NLRC denied the petitioners’ motion for reconsideration. 11
Ruling of the CA
The petitioners elevated the issue to the CA by petition for certiorari, docketed as C.A.-G.R. No.
SP 65714, contending that the NLRC committed grave abuse of discretion amounting to lack of
jurisdiction in reversing the correct decision of the LA.
In its assailed decision promulgated on September 13, 2002,12 the CA dismissed the petition for
certiorari, explaining:
For a position to be considered as a corporate office, or, for that matter, for one to be considered
as a corporate officer, the position must, if not listed in the by-laws, have been created by the
corporation's board of directors, and the occupant thereof appointed or elected by the same board
of directors or stockholders. This is the implication of the ruling in Tabang v. National Labor
Relations Commission, which reads:
"The president, vice president, secretary and treasurer are commonly regarded as the principal or
executive officers of a corporation, and modern corporation statutes usually designate them as the
officers of the corporation. However, other offices are sometimes created by the charter or by-laws
of a corporation, or the board of directors may be empowered under the by-laws of a corporation
to create additional offices as may be necessary.
It has been held that an 'office' is created by the charter of the corporation and the officer is
elected by the directors or stockholders. On the other hand, an 'employee' usually occupies no
office and generally is employed not by action of the directors or stockholders but by the managing
officer of the corporation who also determines the compensation to be paid to such employee."
This ruling was reiterated in the subsequent cases of Ongkingco v. National Labor Relations
Commission and De Rossi v. National Labor Relations Commission.
The position of vice-president for administration and finance, which Coros used to hold in the
corporation, was not created by the corporation’s board of directors but only by its president or
executive vice-president pursuant to the by-laws of the corporation. Moreover, Coros’ appointment
to said position was not made through any act of the board of directors or stockholders of the
corporation. Consequently, the position to which Coros was appointed and later on removed from,
is not a corporate office despite its nomenclature, but an ordinary office in the corporation.
Coros’ alleged illegal dismissal therefrom is, therefore, within the jurisdiction of the labor arbiter.
WHEREFORE, the petition for certiorari is hereby DISMISSED.
SO ORDERED.
The CA denied the petitioners’ motion for reconsideration on April 2, 2003.13
Issue
Thus, the petitioners are now before the Court for a review on certiorari, positing that the
respondent was a stockholder/member of the Matling’s Board of Directors as well as its Vice
President for Finance and Administration; and that the CA consequently erred in holding that the
LA had jurisdiction.
The decisive issue is whether the respondent was a corporate officer of Matling or not. The
resolution of the issue determines whether the LA or the RTC had jurisdiction over his complaint
for illegal dismissal.
Ruling
The appeal fails.
I
The Law on Jurisdiction in Dismissal Cases
As a rule, the illegal dismissal of an officer or other employee of a private employer is properly
cognizable by the LA. This is pursuant to Article 217 (a) 2 of the Labor Code, as amended, which
provides as follows:
Article 217. Jurisdiction of the Labor Arbiters and the Commission. - (a) Except as otherwise
provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear
and decide, within thirty (30) calendar days after the submission of the case by the parties for
decision without extension, even in the absence of stenographic notes, the following cases
involving all workers, whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
 3. If accompanied with a claim for reinstatement, those cases that workers may
file involving wages, rates of pay, hours of work and other terms and conditions
of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from
the employer-employee relations;
5. Cases arising from any violation of Article 264 of this Code, including
questions involving the legality of strikes and lockouts; and
6. Except claims for Employees Compensation, Social Security, Medicare and
maternity benefits, all other claims arising from employer-employee relations,
including those of persons in domestic or household service, involving an amount
exceeding five thousand pesos (₱5,000.00) regardless of whether accompanied
with a claim for reinstatement.
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by
Labor Arbiters.
(c) Cases arising from the interpretation or implementation of collective bargaining
agreements and those arising from the interpretation or enforcement of company
personnel policies shall be disposed of by the Labor Arbiter by referring the same to the
grievance machinery and voluntary arbitration as may be provided in said agreements.
(As amended by Section 9, Republic Act No. 6715, March 21, 1989).
Where the complaint for illegal dismissal concerns a corporate officer, however, the controversy
falls under the jurisdiction of the Securities and Exchange Commission (SEC), because the
controversy arises out of intra-corporate or partnership relations between and among
stockholders, members, or associates, or between any or all of them and the corporation,
partnership, or association of which they are stockholders, members, or associates, respectively;
and between such corporation, partnership, or association and the State insofar as the
controversy concerns their individual franchise or right to exist as such entity; or because the
controversy involves the election or appointment of a director, trustee, officer, or manager of such
corporation, partnership, or association.14 Such controversy, among others, is known as an intra-
corporate dispute.
15
Effective on August 8, 2000, upon the passage of Republic Act No. 8799, otherwise known as
The Securities Regulation Code, the SEC’s jurisdiction over all intra-corporate disputes was
transferred to the RTC, pursuant to Section 5.2 of RA No. 8799, to wit:
5.2. The Commission’s jurisdiction over all cases enumerated under Section 5 of Presidential
Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate
Regional Trial Court: Provided, that the Supreme Court in the exercise of its authority may
designate the Regional Trial Court branches that shall exercise jurisdiction over these cases. The
Commission shall retain jurisdiction over pending cases involving intra-corporate disputes
submitted for final resolution which should be resolved within one (1) year from the enactment of
this Code. The Commission shall retain jurisdiction over pending suspension of
payments/rehabilitation cases filed as of 30 June 2000 until finally disposed.
Considering that the respondent’s complaint for illegal dismissal was commenced on August 10,
2000, it might come under the coverage of Section 5.2 of RA No. 8799, supra, should it turn out
that the respondent was a corporate, not a regular, officer of Matling.
II
Was the Respondent’s Position of Vice President
for Administration and Finance a Corporate Office?
We must first resolve whether or not the respondent’s position as Vice President for Finance and
Administration was a corporate office. If it was, his dismissal by the Board of Directors rendered
the matter an intra-corporate dispute cognizable by the RTC pursuant to RA No. 8799.
The petitioners contend that the position of Vice President for Finance and Administration was a
corporate office, having been created by Matling’s President pursuant to By-Law No. V, as
amended,16 to wit:
BY LAW NO. V
Officers
The President shall be the executive head of the corporation; shall preside over the meetings of
the stockholders and directors; shall countersign all certificates, contracts and other instruments of
the corporation as authorized by the Board of Directors; shall have full power to hire and discharge
any or all employees of the corporation; shall have full power to create new offices and to appoint
the officers thereto as he may deem proper and necessary in the operations of the corporation
and as the progress of the business and welfare of the corporation may demand; shall make
reports to the directors and stockholders and perform all such other duties and functions as are
incident to his office or are properly required of him by the Board of Directors. In case of the
absence or disability of the President, the Executive Vice President shall have the power to
exercise his functions.
The petitioners argue that the power to create corporate offices and to appoint the individuals to
assume the offices was delegated by Matling’s Board of Directors to its President through By-Law
No. V, as amended; and that any office the President created, like the position of the respondent,
was as valid and effective a creation as that made by the Board of Directors, making the office a
corporate office. In justification, they cite Tabang v. National Labor Relations Commission,17 which
held that "other offices are sometimes created by the charter or by-laws of a corporation, or the
board of directors may be empowered under the by-laws of a corporation to create additional
officers as may be necessary."
The respondent counters that Matling’s By-Laws did not list his position as Vice President for
Finance and Administration as one of the corporate offices; that Matling’s By-Law No. III listed only
four corporate officers, namely: President, Executive Vice President, Secretary, and
Treasurer; 18 that the corporate offices contemplated in the phrase "and such other officers as may
be provided for in the by-laws" found in Section 25 of the Corporation Code should be clearly and
expressly stated in the By-Laws; that the fact that Matling’s By-Law No. III dealt with Directors &
Officers while its By-Law No. V dealt with Officers proved that there was a differentiation between
the officers mentioned in the two provisions, with those classified under By-Law No. V being
ordinary or non-corporate officers; and that the officer, to be considered as a corporate officer,
must be elected by the Board of Directors or the stockholders, for the President could only appoint
an employee to a position pursuant to By-Law No. V.
We agree with respondent.
Section 25 of the Corporation Code provides:
Section 25. Corporate officers, quorum.--Immediately after their election, the directors of a
corporation must formally organize by the election of a president, who shall be a director, a
treasurer who may or may not be a director, a secretary who shall be a resident and citizen of the
Philippines, and such other officers as may be provided for in the by-laws. Any two (2) or
more positions may be held concurrently by the same person, except that no one shall act as
president and secretary or as president and treasurer at the same time.
The directors or trustees and officers to be elected shall perform the duties enjoined on them by
law and the by-laws of the corporation. Unless the articles of incorporation or the by-laws provide
for a greater majority, a majority of the number of directors or trustees as fixed in the articles of
incorporation shall constitute a quorum for the transaction of corporate business, and every
decision of at least a majority of the directors or trustees present at a meeting at which there is a
quorum shall be valid as a corporate act, except for the election of officers which shall require the
vote of a majority of all the members of the board.
Directors or trustees cannot attend or vote by proxy at board meetings.
Conformably with Section 25, a position must be expressly mentioned in the By-Laws in order to
be considered as a corporate office. Thus, the creation of an office pursuant to or under a By-Law
enabling provision is not enough to make a position a corporate office. Guerrea v. Lezama,19 the
first ruling on the matter, held that the only officers of a corporation were those given that
character either by the Corporation Code or by the By-Laws; the rest of the corporate officers
could be considered only as employees or subordinate officials. Thus, it was held in Easycall
Communications Phils., Inc. v. King:20
An "office" is created by the charter of the corporation and the officer is elected by the directors or
stockholders. On the other hand, an employee occupies no office and generally is employed not
by the action of the directors or stockholders but by the managing officer of the corporation who
also determines the compensation to be paid to such employee.
In this case, respondent was appointed vice president for nationwide expansion by Malonzo,
petitioner’'s general manager, not by the board of directors of petitioner. It was also Malonzo who
determined the compensation package of respondent. Thus, respondent was an employee, not a
"corporate officer." The CA was therefore correct in ruling that jurisdiction over the case was
properly with the NLRC, not the SEC (now the RTC).
This interpretation is the correct application of Section 25 of the Corporation Code, which plainly
states that the corporate officers are the President, Secretary, Treasurer and such other officers
as may be provided for in the By-Laws. Accordingly, the corporate officers in the context of PD No.
902-A are exclusively those who are given that character either by the Corporation Code or by the
corporation’s By-Laws.
A different interpretation can easily leave the way open for the Board of Directors to circumvent
the constitutionally guaranteed security of tenure of the employee by the expedient inclusion in the
By-Laws of an enabling clause on the creation of just any corporate officer position.
It is relevant to state in this connection that the SEC, the primary agency administering the
Corporation Code, adopted a similar interpretation of Section 25 of the Corporation Code in its
Opinion dated November 25, 1993,21 to wit:
Thus, pursuant to the above provision (Section 25 of the Corporation Code), whoever are the
corporate officers enumerated in the by-laws are the exclusive Officers of the corporation and the
Board has no power to create other Offices without amending first the corporate By-
laws. However, the Board may create appointive positions other than the positions of
corporate Officers, but the persons occupying such positions are not considered as
corporate officers within the meaning of Section 25 of the Corporation Code and are not
empowered to exercise the functions of the corporate Officers, except those functions lawfully
delegated to them. Their functions and duties are to be determined by the Board of
Directors/Trustees.
Moreover, the Board of Directors of Matling could not validly delegate the power to create a
corporate office to the President, in light of Section 25 of the Corporation Code requiring the Board
of Directors itself to elect the corporate officers. Verily, the power to elect the corporate officers
was a discretionary power that the law exclusively vested in the Board of Directors, and could not
be delegated to subordinate officers or agents.22 The office of Vice President for Finance and
Administration created by Matling’s President pursuant to By Law No. V was an ordinary, not a
corporate, office.
To emphasize, the power to create new offices and the power to appoint the officers to occupy
them vested by By-Law No. V merely allowed Matling’s President to create non-corporate offices
to be occupied by ordinary employees of Matling. Such powers were incidental to the President’s
duties as the executive head of Matling to assist him in the daily operations of the business.
The petitioners’ reliance on Tabang, supra, is misplaced. The statement in Tabang, to the effect
that offices not expressly mentioned in the By-Laws but were created pursuant to a By-Law
enabling provision were also considered corporate offices, was plainly obiter dictum due to the
position subject of the controversy being mentioned in the By-Laws. Thus, the Court held therein
that the position was a corporate office, and that the determination of the rights and liabilities
arising from the ouster from the position was an intra-corporate controversy within the SEC’s
jurisdiction.
In Nacpil v. Intercontinental Broadcasting Corporation, 23 which may be the more appropriate
ruling, the position subject of the controversy was not expressly mentioned in the By-Laws, but
was created pursuant to a By-Law enabling provision authorizing the Board of Directors to create
other offices that the Board of Directors might see fit to create. The Court held there that the
position was a corporate office, relying on the obiter dictum in Tabang.
Considering that the observations earlier made herein show that the soundness of their dicta is not
unassailable, Tabang and Nacpil should no longer be controlling.
III
Did Respondent’s Status as Director and
Stockholder Automatically Convert his Dismissal
into an Intra-Corporate Dispute?
Yet, the petitioners insist that because the respondent was a Director/stockholder of Matling, and
relying on Paguio v. National Labor Relations Commission24 and Ongkingko v. National Labor
Relations Commission,25 the NLRC had no jurisdiction over his complaint, considering that any
case for illegal dismissal brought by a stockholder/officer against the corporation was an intra-
corporate matter that must fall under the jurisdiction of the SEC conformably with the context of
PD No. 902-A.
The petitioners’ insistence is bereft of basis.
To begin with, the reliance on Paguio and Ongkingko is misplaced. In both rulings, the
complainants were undeniably corporate officers due to their positions being expressly mentioned
in the By-Laws, aside from the fact that both of them had been duly elected by the respective
Boards of Directors. But the herein respondent’s position of Vice President for Finance and
Administration was not expressly mentioned in the By-Laws; neither was the position of Vice
President for Finance and Administration created by Matling’s Board of Directors. Lastly, the
President, not the Board of Directors, appointed him.
True it is that the Court pronounced in Tabang as follows:
Also, an intra-corporate controversy is one which arises between a stockholder and the
corporation. There is no distinction, qualification or any exemption whatsoever. The provision is
broad and covers all kinds of controversies between stockholders and corporations.26
However, the Tabang pronouncement is not controlling because it is too sweeping and does not
accord with reason, justice, and fair play. In order to determine whether a dispute constitutes an
intra-corporate controversy or not, the Court considers two elements instead, namely: (a) the
status or relationship of the parties; and (b) the nature of the question that is the subject of their
controversy. This was our thrust in Viray v. Court of Appeals:27
The establishment of any of the relationships mentioned above will not necessarily always confer
jurisdiction over the dispute on the SEC to the exclusion of regular courts. The statement made in
one case that the rule admits of no exceptions or distinctions is not that absolute. The better policy
in determining which body has jurisdiction over a case would be to consider not only the status or
relationship of the parties but also the nature of the question that is the subject of their
controversy.
Not every conflict between a corporation and its stockholders involves corporate matters that only
the SEC can resolve in the exercise of its adjudicatory or quasi-judicial powers. If, for example, a
person leases an apartment owned by a corporation of which he is a stockholder, there should be
no question that a complaint for his ejectment for non-payment of rentals would still come under
the jurisdiction of the regular courts and not of the SEC. By the same token, if one person injures
another in a vehicular accident, the complaint for damages filed by the victim will not come under
the jurisdiction of the SEC simply because of the happenstance that both parties are stockholders
of the same corporation. A contrary interpretation would dissipate the powers of the regular courts
and distort the meaning and intent of PD No. 902-A.
In another case, Mainland Construction Co., Inc. v. Movilla,28 the Court reiterated these
determinants thuswise:
In order that the SEC (now the regular courts) can take cognizance of a case, the controversy
must pertain to any of the following relationships:
a) between the corporation, partnership or association and the public;
b) between the corporation, partnership or association and its stockholders, partners,
members or officers;
c) between the corporation, partnership or association and the State as far as its
franchise, permit or license to operate is concerned; and
d) among the stockholders, partners or associates themselves.
The fact that the parties involved in the controversy are all stockholders or that the parties involved
are the stockholders and the corporation does not necessarily place the dispute within the ambit of
the jurisdiction of SEC. The better policy to be followed in determining jurisdiction over a case
should be to consider concurrent factors such as the status or relationship of the parties or the
nature of the question that is the subject of their controversy. In the absence of any one of these
factors, the SEC will not have jurisdiction. Furthermore, it does not necessarily follow that every
conflict between the corporation and its stockholders would involve such corporate matters as only
the SEC can resolve in the exercise of its adjudicatory or quasi-judicial powers.29
The criteria for distinguishing between corporate officers who may be ousted from office at will, on
one hand, and ordinary corporate employees who may only be terminated for just cause, on the
other hand, do not depend on the nature of the services performed, but on the manner of creation
of the office. In the respondent’s case, he was supposedly at once an employee, a stockholder,
and a Director of Matling. The circumstances surrounding his appointment to office must be fully
considered to determine whether the dismissal constituted an intra-corporate controversy or a
labor termination dispute. We must also consider whether his status as Director and stockholder
had any relation at all to his appointment and subsequent dismissal as Vice President for Finance
and Administration.
Obviously enough, the respondent was not appointed as Vice President for Finance and
Administration because of his being a stockholder or Director of Matling. He had started working
for Matling on September 8, 1966, and had been employed continuously for 33 years until his
termination on April 17, 2000, first as a bookkeeper, and his climb in 1987 to his last position as
Vice President for Finance and Administration had been gradual but steady, as the following
sequence indicates:
1966 – Bookkeeper
1968 – Senior Accountant
1969 – Chief Accountant
1972 – Office Supervisor
Vice-President which she occupied until her illegal dismissal on July 19, 1991. The bank’s
contention that she merely holds an elective position and that in effect she is not a regular
employee is belied by the nature of her work and her length of service with the Bank. As
earlier stated, she rose from the ranks and has been employed with the Bank since 1963 until the
termination of her employment in 1991. As Assistant Vice President of the Foreign Department of
the Bank, she is tasked, among others, to collect checks drawn against overseas banks payable in
foreign currency and to ensure the collection of foreign bills or checks purchased, including the
signing of transmittal letters covering the same. It has been stated that "the primary standard of
determining regular employment is the reasonable connection between the particular activity
performed by the employee in relation to the usual trade or business of the employer. Additionally,
"an employee is regular because of the nature of work and the length of service, not because of
the mode or even the reason for hiring them." As Assistant Vice-President of the Foreign
Department of the Bank she performs tasks integral to the operations of the bank and her length
of service with the bank totaling 28 years speaks volumes of her status as a regular employee of
the bank. In fine, as a regular employee, she is entitled to security of tenure; that is, her services
may be terminated only for a just or authorized cause. This being in truth a case of illegal
dismissal, it is no wonder then that the Bank endeavored to the very end to establish loss of trust
and confidence and serious misconduct on the part of private respondent but, as will be discussed
later, to no avail.

1973 – Assistant Treasurer WHEREFORE, we deny the petition for review on certiorari, and affirm the decision of the Court of
Appeals.
1978 – Special Assistant for Finance
Costs of suit to be paid by the petitioners.
1980 – Assistant Comptroller
SO ORDERED.
1983 – Finance and Administrative Manager

1985 – Asst. Vice President for Finance and Administration

1987 to April 17, 2000 – Vice President for Finance and Administration

Even though he might have become a stockholder of Matling in 1992, his promotion to the position
of Vice President for Finance and Administration in 1987 was by virtue of the length of quality
service he had rendered as an employee of Matling. His subsequent acquisition of the status of
Director/stockholder had no relation to his promotion. Besides, his status of Director/stockholder
was unaffected by his dismissal from employment as Vice President for Finance and
Administration.1avvphi1

In Prudential Bank and Trust Company v. Reyes,30 a case involving a lady bank manager who had
risen from the ranks but was dismissed, the Court held that her complaint for illegal dismissal was
correctly brought to the NLRC, because she was deemed a regular employee of the bank. The
Court observed thus:

It appears that private respondent was appointed Accounting Clerk by the Bank on July 14, 1963.
From that position she rose to become supervisor. Then in 1982, she was appointed Assistant
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 185567 October 20, 2010
ARSENIO Z. LOCSIN, Petitioner,
vs.
NISSAN LEASE PHILS. INC. and LUIS BANSON, Respondents.
DECISION
BRION, J.:
Through a petition for review on certiorari,1 petitioner Arsenio Z. Locsin (Locsin) seeks the reversal
of the Decision2of the Court of Appeals (CA) dated August 28, 2008,3 in "Arsenio Z. Locsin v.
Nissan Car Lease Phils., Inc. and Luis Banson," docketed as CA-G.R. SP No. 103720 and the
Resolution dated December 9, 2008,4 denying Locsin’s Motion for Reconsideration. The assailed
ruling of the CA reversed and set aside the Decision5 of the Hon. Labor Arbiter Thelma
Concepcion (Labor Arbiter Concepcion) which denied Nissan Lease Phils. Inc.’s (NCLPI) and Luis
T. Banson’s (Banson) Motion to Dismiss.
THE FACTUAL ANTECEDENTS
On January 1, 1992, Locsin was elected Executive Vice President and Treasurer (EVP/Treasurer)
of NCLPI. As EVP/Treasurer, his duties and responsibilities included: (1) the management of the
finances of the company; (2) carrying out the directions of the President and/or the Board of
Directors regarding financial management; and (3) the preparation of financial reports to advise
the officers and directors of the financial condition of NCLPI.6 Locsin held this position for 13
years, having been re-elected every year since 1992, until January 21, 2005, when he was
nominated and elected Chairman of NCLPI’s Board of Directors.7
On August 5, 2005, a little over seven (7) months after his election as Chairman of the Board, the
NCLPI Board held a special meeting at the Manila Polo Club. One of the items of the agenda was
the election of a new set of officers. Unfortunately, Locsin was neither re-elected Chairman nor
reinstated to his previous position as EVP/Treasurer.8
Aggrieved, on June 19, 2007, Locsin filed a complaint for illegal dismissal with prayer for
reinstatement, payment of backwages, damages and attorney’s fees before the Labor Arbiter
against NCLPI and Banson, who was then President of NCLPI.9
The Compulsory Arbitration Proceedings before the Labor Arbiter.
On July 11, 2007, instead of filing their position paper, NCLPI and Banson filed a Motion to
Dismiss,10 on the ground that the Labor Arbiter did not have jurisdiction over the case since the
issue of Locsin’s removal as EVP/Treasurer involves an intra-corporate dispute.
On August 16, 2007, Locsin submitted his opposition to the motion to dismiss, maintaining his
position that he is an employee of NCLPI.
On March 10, 2008, Labor Arbiter Concepcion issued an Order denying the Motion to Dismiss,
holding that her office acquired "jurisdiction to arbitrate and/or decide the instant complaint finding
extant in the case an employer-employee relationship."11
NCLPI, on June 3, 2008, elevated the case to the CA through a Petition for Certiorari under Rule
65 of the Rules of Court.12 NCLPI raised the issue on whether the Labor Arbiter committed grave
abuse of discretion by denying the Motion to Dismiss and holding that her office had jurisdiction
over the dispute.
The CA Decision - Locsin was a corporate officer; the issue of his removal as EVP/Treasurer is an
intra-corporate dispute under the RTC’s jurisdiction.
On August 28, 2008,13 the CA reversed and set aside the Labor Arbiter’s Order denying the
Motion to Dismiss and ruled that Locsin was a corporate officer.
Citing PD 902-A, the CA defined "corporate officers as those officers of a corporation who are
given that character either by the Corporation Code or by the corporations’ by-laws." In this
regard, the CA held:
Scrutinizing the records, We hold that petitioners successfully discharged their onus of
establishing that private respondent was a corporate officer who held the position of Executive
Vice-President/Treasurer as provided in the by-laws of petitioner corporation and that he held
such position by virtue of election by the Board of Directors.
That private respondent is a corporate officer cannot be disputed. The position of Executive Vice-
President/Treasurer is specifically included in the roster of officers provided for by the (Amended)
By-Laws of petitioner corporation, his duties and responsibilities, as well as compensation as such
officer are likewise set forth therein.14
Article 280 of the Labor Code, the receipt of salaries by Locsin, SSS deductions on that salary,
and the element of control in the performance of work duties – indicia used by the Labor Arbiter to
conclude that Locsin was a regular employee – were held inapplicable by the CA.15 The CA noted
the Labor Arbiter’s failure to address the fact that the position of EVP/Treasurer is specifically
enumerated as an "office" in the corporation’s by-laws.16
Further, the CA pointed out Locsin’s failure to "state any circumstance by which NCLPI engaged
his services as a corporate officer that would make him an employee." The CA found, in this
regard, that Locsin’s assumption and retention as EVP/Treasurer was based on his election and
subsequent re-elections from 1992 until 2005. Further, he performed only those functions that
were "specifically set forth in the By-Laws or required of him by the Board of Directors.17"
With respect to the suit Locsin filed with the Labor Arbiter, the CA held that:
Private respondent, in belatedly filing this suit before the Labor Arbiter, questioned the legality of
his "dismissal" but in essence, he raises the issue of whether or not the Board of Directors had the
authority to remove him from the corporate office to which he was elected pursuant to the By-Laws
of the petitioner corporation. Indeed, had private respondent been an ordinary employee, an
election conducted by the Board of Directors would not have been necessary to remove him as
Executive Vice-President/Treasurer. However, in an obvious attempt to preclude the application of
settled jurisprudence that corporate officers whose position is provided in the by-laws, their
election, removal or dismissal is subject to Section 5 of P.D. No. 902-A (now R.A. No. 8799),
private respondent would even claim in his Position Paper, that since his responsibilities were akin
to that of the company’s Executive Vice-President/Treasurer, he was "hired under the pretext that
he was being ‘elected’ into said post.18 [Emphasis supplied.]
As a consequence, the CA concluded that Locsin does not have any recourse with the Labor
Arbiter or the NLRC since the removal of a corporate officer, whether elected or appointed, is an
intra-corporate controversy over which the NLRC has no jurisdiction. 19 Instead, according to the
CA, Locsin’s complaint for "illegal dismissal" should have been filed in the Regional Trial Court
(RTC), pursuant to Rule 6 of the Interim Rules of Procedure Governing Intra-Corporate
Controversies.20
Finally, the CA addressed Locsin’s invocation of Article 4 of the Labor Code. Dismissing the
application of the provision, the CA cited Dean Cesar Villanueva of the Ateneo School of Law, as
follows:
x x x the non-coverage of corporate officers from the security of tenure clause under the
Constitution is now well-established principle by numerous decisions upholding such doctrine
under the aegis of the 1987 Constitution in the face of contemporary decisions of the same
Supreme Court likewise confirming that security of tenure covers all employees or workers
including managerial employees.21
THE PETITIONER’S ARGUMENTS
Failing to obtain a reconsideration of the CA’s decision, Locsin filed the present petition on
January 28, 2009, raising the following procedural and substantive issues:
(1) Whether the CA has original jurisdiction to review decision of the Labor Arbiter under
Rule 65?
(2) Whether he is a regular employee of NCLPI under the definition of Article 280 of the
Labor Code? and
(3) Whether Locsin’s position as Executive Vice-President/Treasurer makes him a
corporate officer thereby excluding him from the coverage of the Labor Code?
Procedurally, Locsin essentially submits that NCLPI wrongfully filed a petition for certiorari before
the CA, as the latter’s remedy is to proceed with the arbitration, and to appeal to the NLRC after
the Labor Arbiter shall have ruled on the merits of the case. Locsin cites, in this regard, Rule V,
Section 6 of the Revised Rules of the National Labor Relations Commission (NLRC Rules), which
provides that a denial of a motion to dismiss by the Labor Arbiter is not subject to an appeal.
Locsin also argues that even if the Labor Arbiter committed grave abuse of discretion in denying
the NCLPI motion, a special civil action for certiorari, filed with the CA was not the appropriate
remedy, since this was a breach of the doctrine of exhaustion of administrative remedies.
Substantively, Locsin submits that he is a regular employee of NCLPI since - as he argued before
the Labor Arbiter and the CA - his relationship with the company meets the "four-fold test."
First, Locsin contends that NCLPI had the power to engage his services as EVP/Treasurer.
Second, he received regular wages from NCLPI, from which his SSS and Philhealth contributions,
as well as his withholding taxes were deducted. Third, NCLPI had the power to terminate his
employment.22 Lastly, Nissan had control over the manner of the performance of his functions as
EVP/Treasurer, as shown by the 13 years of faithful execution of his job, which he carried out in
accordance with the standards and expectations set by NCLPI.23 Further, Locsin maintains that
even after his election as Chairman, he essentially performed the functions of EVP/Treasurer –
handling the financial and administrative operations of the Corporation – thus making him a
regular employee.24
Under these claimed facts, Locsin concludes that the Labor Arbiter and the NLRC – not the RTC
(as NCLPI posits) – has jurisdiction to decide the controversy. Parenthetically, Locsin clarifies that
he does not dispute the validity of his election as Chairman of the Board on January 1, 2005.
Instead, he theorizes that he never lost his position as EVP/Treasurer having continuously
performed the functions appurtenant thereto.25 Thus, he questions his "unceremonious removal"
as EVP/Treasurer during the August 5, 2005 special Board meeting.
THE RESPONDENT’S ARGUMENTS
It its April 17, 2009 Comment,26 Nissan prays for the denial of the petition for lack of merit. Nissan
submits that the CA correctly ruled that the Labor Arbiter does not have jurisdiction over Locsin’s
complaint for illegal dismissal. In support, Nissan maintains that Locsin is a corporate officer and
not an employee. In addressing the procedural defect Locsin raised, Nissan brushes the issue
aside, stating that (1) this issue was belatedly raised in the Motion for Reconsideration, and that
(2) in any case, Rule VI, Section 2(1) of the NLRC does not apply since only appealable decisions,
resolutions and orders are covered under the rule.
THE COURT’S RULING
We resolve to deny the petition for lack of merit.
At the outset, we stress that there are two (2) important considerations in the final determination of
this case. On the one hand, Locsin raises a procedural issue that, if proven correct, will require the
Court to dismiss the instant petition for using an improper remedy. On the other hand, there is the
substantive issue that will be disregarded if a strict implementation of the rules of procedure is
upheld.
Prefatorily, we agree with Locsin’s submission that the NCLPI incorrectly elevated the Labor
Arbiter’s denial of the Motion to Dismiss to the CA. Locsin is correct in positing that the denial of a
motion to dismiss is unappealable. As a general rule, an aggrieved party’s proper recourse to the
denial is to file his position paper, interpose the grounds relied upon in the motion to dismiss
before the labor arbiter, and actively participate in the proceedings. Thereafter, the labor arbiter’s
decision can be appealed to the NLRC, not to the CA.
As a rule, we strictly adhere to the rules of procedure and do everything we can, to the point of
penalizing violators, to encourage respect for these rules. We take exception to this general rule,
however, when a strict implementation of these rules would cause substantial injustice to the
parties.
We see it appropriate to apply the exception to this case for the reasons discussed below; hence,
we are compelled to go beyond procedure and rule on the merits of the case. In the context of this
case, we see sufficient justification to rule on the employer-employee relationship issue raised by
NCLPI, even though the Labor Arbiter’s interlocutory order was incorrectly brought to the CA
under Rule 65.
The NLRC Rules are clear: the denial by the labor arbiter of the motion to dismiss is not
appealable because the denial is merely an interlocutory order.
In Metro Drug v. Metro Drug Employees,27 we definitively stated that the denial of a motion to
dismiss by a labor arbiter is not immediately appealable.28
We similarly ruled in Texon Manufacturing v. Millena,29 in Sime Darby Employees Association v.
National Labor Relations Commission30 and in Westmont Pharmaceuticals v. Samaniego.31 In
Texon, we specifically said:
The Order of the Labor Arbiter denying petitioners’ motion to dismiss is interlocutory. It is well-
settled that a denial of a motion to dismiss a complaint is an interlocutory order and hence, cannot
be appealed, until a final judgment on the merits of the case is rendered. [Emphasis supplied.]32
and indicated the appropriate recourse in Metro Drug, as follows:33
x x x The NLRC rule proscribing appeal from a denial of a motion to dismiss is similar to the
general rule observed in civil procedure that an order denying a motion to dismiss is interlocutory
and, hence, not appealable until final judgment or order is rendered [1 Feria and Noche, Civil
Procedure Annotated 453 (2001 ed.)]. The remedy of the aggrieved party in case of denial of the
motion to dismiss is to file an answer and interpose, as a defense or defenses, the ground or
grounds relied upon in the motion to dismiss, proceed to trial and, in case of adverse judgment, to
elevate the entire case by appeal in due course [Mendoza v. Court of Appeals, G.R. No. 81909,
September 5, 1991, 201 SCRA 343]. In order to avail of the extraordinary writ of certiorari, it is
incumbent upon petitioner to establish that the denial of the motion to dismiss was tainted with
grave abuse of discretion. [Macawiwili Gold Mining and Development Co., Inc. v. Court of Appeals,
G.R. No. 115104, October 12, 1998, 297 SCRA 602]
In so citing Feria and Noche, the Court was referring to Sec. 1 (b), Rule 41 of the Rules of Court,
which specifically enumerates interlocutory orders as one of the court actions that cannot be
appealed. In the same rule, as amended by A.M. No. 07-7-12-SC, the aggrieved party is allowed
to file an appropriate special civil action under Rule 65. The latter rule, however, also contains
limitations for its application, clearly outlined in its Section 1 which provides:
Section 1. Petition for certiorari.
When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without
or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess
of jurisdiction, and there is no appeal, or any plain, speedy, and adequate remedy in the
ordinary course of law, a person aggrieved thereby may file a verified petition in the proper
court, alleging the facts with certainty and praying that judgment be rendered annulling or
modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as
law and justice may require.
In the labor law setting, a plain, speedy and adequate remedy is still open to the aggrieved party
when a labor arbiter denies a motion to dismiss. This is Article 223 of Presidential Decree No. 442,
as amended (Labor Code), 34which states:
ART. 223. APPEAL
Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar days from receipt of such decisions,
awards, or orders. Such appeal may be entertained only on any of the following grounds:
(a) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter; x x x
[Emphasis supplied.]
Pursuant to this Article, we held in Metro Drug (citing Air Services Cooperative, et al. v. Court of
Appeals35) that the NLRC is clothed with sufficient authority to correct any claimed "erroneous
assumption of jurisdiction" by labor arbiters:
In Air Services Cooperative, et al. v. The Court of Appeals, et al., a case where the jurisdiction of
the labor arbiter was put in issue and was assailed through a petition for certiorari, prohibition and
annulment of judgment before a regional trial court, this Court had the opportunity to expound on
the nature of appeal as embodied in Article 223 of the Labor Code, thus:
x x x Also, while the title of the Article 223 seems to provide only for the remedy of appeal as that
term is understood in procedural law and as distinguished from the office of certiorari,
nonetheless, a closer reading thereof reveals that it is not as limited as understood by the
petitioners x x x.
Abuse of discretion is admittedly within the ambit of certiorari and its grant of review thereof to the
NLRC indicates the lawmakers’ intention to broaden the meaning of appeal as that term is used in
the Code. For this reason, petitioners cannot argue now that the NLRC is devoid of any corrective
power to rectify a supposed erroneous assumption of jurisdiction by the Labor Arbiter x x x. [Air
Services Cooperative, et al. v. The Court of Appeals, et al. G.R. No. 118693, 23 July 1998, 293
SCRA 101]
Since the legislature had clothed the NLRC with the appellate authority to correct a claimed
"erroneous assumption of jurisdiction" on the part of the labor arbiter – a case of grave abuse of
discretion - the remedy availed of by petitioner in this case is patently erroneous as recourse in
this case is lodged, under the law, with the NLRC.
In Metro Drug, as in the present case, the defect imputed through the NLCPI Motion to Dismiss is
the labor arbiter’s lack of jurisdiction since Locsin is alleged to be a corporate officer, not an
employee. Parallelisms between the two cases is undeniable, as they are similar on the following
points: (1) in Metro Drug, as in this case, the Labor Arbiter issued an Order denying the Motion to
Dismiss by one of the parties; (2) the basis of the Motion to Dismiss is also the alleged lack of
jurisdiction by the Labor Arbiter to settle the dispute; and (3) dissatisfied with the Order of the
Labor Arbiter, the aggrieved party likewise elevated the case to the CA via Rule 65.
The similarities end there, however. Unlike in the present case, the CA denied the petition for
certiorari and the subsequent Motion for Reconsideration in Metro Drug; the CA correctly found
that the proper appellate mechanism was an appeal to the NLRC and not a petition for certiorari
under Rule 65. In the present case, the CA took a different position despite our clear ruling in
Metro Drug, and allowed, not only the use of Rule 65, but also ruled on the merits.
From this perspective, the CA clearly erred in the application of the procedural rules by
disregarding the relevant provisions of the NLRC Rules, as well as the requirements for a petition
for certiorari under the Rules of Court. To reiterate, the proper action of an aggrieved party faced
with the labor arbiter’s denial of his motion to dismiss is to submit his position paper and raise
therein the supposed lack of jurisdiction. The aggrieved party cannot immediately appeal the
denial since it is an interlocutory order; the appropriate remedial recourse is the procedure
outlined in Article 223 of the Labor Code, not a petition for certiorari under Rule 65.
A strict implementation of the NLRC Rules and the Rules of Court would cause injustice to the
parties because the Labor Arbiter clearly has no jurisdiction over the present intra-corporate
dispute.
Our ruling in Mejillano v. Lucillo36 stands for the proposition that we should strictly apply the rules
of procedure. We said:
Time and again, we have ruled that procedural rules do not exist for the convenience of the
litigants. Rules of Procedure exist for a purpose, and to disregard such rules in the guise of liberal
construction would be to defeat such purpose. Procedural rules were established primarily to
provide order to and enhance the efficiency of our judicial system. [Emphasis supplied.]
An exception to this rule is our ruling in Lazaro v. Court of Appeals 37 where we held that the strict
enforcement of the rules of procedure may be relaxed in exceptionally meritorious cases:
x x x Procedural rules are not to be belittled or dismissed simply because their non-observance
may have resulted in prejudice to a party's substantive rights. Like all rules, they are required to be
followed except only for the most persuasive of reasons when they may be relaxed to relieve a
litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying
with the procedure prescribed. The Court reiterates that rules of procedure, especially those
prescribing the time within which certain acts must be done, "have oft been held as absolutely
indispensable to the prevention of needless delays and to the orderly and speedy discharge of
business. x x x The reason for rules of this nature is because the dispatch of business by courts
would be impossible, and intolerable delays would result, without rules governing practice x x x.
Such rules are a necessary incident to the proper, efficient and orderly discharge of judicial
functions." Indeed, in no uncertain terms, the Court held that the said rules may be relaxed only in
exceptionally meritorious cases. [Emphasis supplied.]
Whether a case involves an exceptionally meritorious circumstance can be tested under the
guidelines we established in Sanchez v. Court of Appeals,38 as follows:
Aside from matters of life, liberty, honor or property which would warrant the suspension of the
Rules of the most mandatory character and an examination and review by the appellate court of
the lower court’s findings of fact, the other elements that should be considered are the following:
(a) the existence of special or compelling circumstances, (b) the merits of the case, (c) a cause not
entirely attributable to the fault or negligence of the party favored by the suspension of the rules,
(d) a lack of any showing that the review sought is merely frivolous and dilatory, and (e) the other
party will not be unjustly prejudiced thereby. [Emphasis supplied.]
Under these standards, we hold that exceptional circumstances exist in the present case to merit
the relaxation of the applicable rules of procedure.
Due to existing exceptional circumstances, the ruling on the merits that Locsin is an officer and not
an employee of Nissan must take precedence over procedural considerations.
We arrived at the conclusion that we should go beyond the procedural rules and immediately take
a look at the intrinsic merits of the case based on several considerations.
First, the parties have sufficiently ventilated their positions on the disputed employer-employee
relationship and have, in fact, submitted the matter for the CA’s consideration.
Second, the CA correctly ruled that no employer-employee relationship exists between Locsin and
Nissan.
Locsin was undeniably Chairman and President, and was elected to these positions by the Nissan
board pursuant to its By-laws.39 As such, he was a corporate officer, not an employee. The CA
reached this conclusion by relying on the submitted facts and on Presidential Decree 902-A, which
defines corporate officers as "those officers of a corporation who are given that character either by
the Corporation Code or by the corporation’s by-laws." Likewise, Section 25 of Batas Pambansa
Blg. 69, or the Corporation Code of the Philippines (Corporation Code) provides that corporate
officers are the president, secretary, treasurer and such other officers as may be provided for in
the by-laws.
Third. Even as Executive Vice-President/Treasurer, Locsin already acted as a corporate officer
because the position of Executive Vice-President/Treasurer is provided for in Nissan’s By-Laws.
Article IV, Section 4 of these By-Laws specifically provides for this position, as follows:
ARTICLE IV
Officers
Section 1. Election and Appointment – The Board of Directors at their first meeting, annually
thereafter, shall elect as officers of the Corporation a Chairman of the Board, a President, an
Executive Vice-President/Treasurer, a Vice-President/General Manager and a Corporate
Secretary. The other Senior Operating Officers of the Corporation shall be appointed by the Board
upon the recommendation of the President.
xxxx
Section 4. Executive Vice-President/Treasurer – The Executive Vice-President/Treasurer shall
have such powers and perform such duties as are prescribed by these By-Laws, and as may be
required of him by the Board of Directors. As the concurrent Treasurer of the Corporation, he shall
have the charge of the funds, securities, receipts, and disbursements of the Corporation. He shall
deposit, or cause to be deposited, the credit of the Corporation in such banks or trust companies,
or with such banks of other depositories, as the Board of Directors may from time to time
designate. He shall tender to the President or to the Board of Directors whenever required an
account of the financial condition of the corporation and of all his transactions as Treasurer. As
soon as practicable after the close of each fiscal year, he shall make and submit to the Board of
Directors a like report of such fiscal year. He shall keep correct books of account of all the
business and transactions of the Corporation.
In Okol v. Slimmers World International,40 citing Tabang v. National Labor Relations
Commission,41 we held that –
x x x an "office" is created by the charter of the corporation and the officer is elected by the
directors or stockholders. On the other hand, an "employee" usually occupies no office and
generally is employed not by action of the directors or stockholders but by the managing officer of
the corporation who also determines the compensation to be paid to such employee. [Emphasis
supplied.]
In this case, Locsin was elected by the NCLPI Board, in accordance with the Amended By-Laws of
the corporation. The following factual determination by the CA is elucidating:
More important, private respondent failed to state any such "circumstance" by which the petitioner
corporation "engaged his services" as corporate officer that would make him an employee. In the
first place, the Vice-President/Treasurer was elected on an annual basis as provided in the By-
Laws, and no duties and responsibilities were stated by private respondent which he discharged
while occupying said position other than those specifically set forth in the By-Laws or required of
him by the Board of Directors. The unrebutted fact remains that private respondent held the
position of Executive Vice-President/Treasurer of petitioner corporation, a position provided for in
the latter’s by-laws, by virtue of election by the Board of Directors, and has functioned as such
Executive Vice-President/Treasurer pursuant to the provisions of the said By-Laws. Private
respondent knew very well that he was simply not re-elected to the said position during the August
5, 2005 board meeting, but he had objected to the election of a new set of officers held at the time
upon the advice of his lawyer that he cannot be "terminated" or replaced as Executive Vice-
President/Treasurer as he had attained tenurial security.42
We fully agree with this factual determination which we find to be sufficiently supported by
evidence. We likewise rule, based on law and established jurisprudence, that Locsin, at the time of
his severance from NCLPI, was the latter’s corporate officer.
a. The Question of Jurisdiction
Given Locsin’s status as a corporate officer, the RTC, not the Labor Arbiter or the NLRC, has
jurisdiction to hear the legality of the termination of his relationship with Nissan. As we also held in
Okol, a corporate officer’s dismissal from service is an intra-corporate dispute:
In a number of cases [Estrada v. National Labor Relations Commission, G.R. No. 106722, 4
October 1996, 262 SCRA 709; Lozon v. National Labor Relations Commission, 310 Phil. 1
(1995); Espino v. National Labor Relations Commission, 310 Phil. 61 (1995); Fortune Cement
Corporation v. National Labor Relations Commission, G.R. No. 79762, 24 January 1991, 193
SCRA 258], we have held that a corporate officer’s dismissal is always a corporate act, or an intra-
corporate controversy which arises between a stockholder and a corporation. 43 [Emphasis
supplied.]
so that the RTC should exercise jurisdiction based on the following legal reasoning:
Prior to its amendment, Section 5(c) of Presidential Decree No. 902-A (PD 902-A) provided that
intra-corporate disputes fall within the jurisdiction of the Securities and Exchange Commission
(SEC):
Sec. 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange
Commission over corporations, partnerships and other forms of associations registered with it as
expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction
to hear and decide cases involving:
xxxx
c) Controversies in the election or appointments of directors, trustees, officers or managers of
such corporations, partnerships or associations.

Subsection 5.2, Section 5 of Republic Act No. 8799, which took effect on 8 August 2000,
transferred to regional trial courts the SEC’s jurisdiction over all cases listed in Section 5 of PD
902-A:

5.2. The Commission’s jurisdiction over all cases enumerated under Section 5 of Presidential
Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate
Regional Trial Court. [Emphasis supplied.]

b. Precedence of Substantive Merits;

Primacy of Element of Jurisdiction

Based on the above jurisdictional considerations, we would be forced to remand the case to the
Labor Arbiter for further proceedings if we were to dismiss the petition outright due to the wrongful
use of Rule 65.44 We cannot close our eyes, however, to the factual and legal reality, established
by evidence already on record, that Locsin is a corporate officer whose termination of relationship
is outside a labor arbiter’s jurisdiction to rule upon.

Under these circumstances, we have to give precedence to the merits of the case, and primacy to
the element of jurisdiction. Jurisdiction is the power to hear and rule on a case and is the threshold
element that must exist before any quasi-judicial officer can act. In the context of the present case,
the Labor Arbiter does not have jurisdiction over the termination dispute Locsin brought, and
should not be allowed to continue to act on the case after the absence of jurisdiction has become
obvious, based on the records and the law. In more practical terms, a contrary ruling will only
cause substantial delay and inconvenience as well as unnecessary expenses, to the point of
injustice, to the parties. This conclusion, of course, does not go into the merits of termination of
relationship and is without prejudice to the filing of an intra-corporate dispute on this point before
the appropriate RTC.

WHEREFORE, we DISMISS the petitioner’s petition for review on certiorari, and AFFIRM the
Decision of the Court of Appeals, in CA-G.R. SP No. 103720, promulgated on August 28, 2008, as
well as its Resolution of December 9, 2008, which reversed and set aside the March 10, 2008
Order of Labor Arbiter Concepcion in NLRC NCR Case No. 00-06-06165-07. This Decision is
without prejudice to petitioner Locsin’s available recourse for relief through the appropriate remedy
in the proper forum.

No pronouncement as to costs.

SO ORDERED.
SECOND DIVISION 1. and all other persons claiming rights under them to vacate the premises
located at Mariveles corner Calbayog Streets, Mandaluyong City, and to
G.R. No. 147874 July 17, 2006 surrender the possession of the same to the plaintiff;

DOLORES GAYOSO, DANNY GAYOSO, ELIZABETH G. DONDRIANO, VICTORIANO 2. to pay the plaintiff the amount of P4,000.00 representing their unpaid rentals
GAYOSO, CHRISTOPHER GAYOSO, REMEDIOS GAYOSO and THE HEIRS OF VICTORIANO beginning February 1981 to December 1996 and the amount of P20.00 per
GAYOSO, petitioners, month every month thereafter until the premises shall have been vacated;
vs.
TWENTY-TWO REALTY DEVELOPMENT CORPORATION, respondent. 3. to pay the plaintiff the amount of P10,000.00 as and by way of attorney's fees;
and
DECISION
4. to pay the costs of suit.
SANDOVAL-GUTIERREZ, J.:
B. dismissing the counterclaim.
1
For our resolution is the instant Petition for Review on Certiorari assailing the Decision of the
Court of Appeals dated April 20, 2001 in CA-G.R. SP No. 48001. SO ORDERED.

This case stemmed from a Complaint for Ejectment filed by Twenty-Two Realty Development The MeTC ruled that since petitioners failed to pay rentals for more than three months, then
Corporation (TTRDC), respondent, on December 12, 1996 with the Metropolitan Trial Court respondent has the right to evict them from the premises.
(MeTC), Branch 60, Mandaluyong City against the above-named petitioners. The complaint,
docketed as Civil Case No. 15340, alleges that on October 11, 1954, Victoriano Gayoso (now On appeal, the Regional Trial Court (RTC), Branch 213, Mandaluyong City, affirmed the MeTC
deceased) sold to Prospero Almeda a lot located on Mariveles corner Calbayog Streets, Decision, holding that the refusal of petitioners to vacate the property and pay the rents make out
Mandaluyong City. After the sale, Almeda allowed Gayoso and his children, herein petitioners, to a clear case of unlawful detainer over which the MeTC has jurisdiction.
stay on the property as lessees, paying P20.00 a month. Later, Almeda's heirs sold the lot to
respondent TTRDC. Thus, on February 19, 1996, the title to the property was transferred in the
name of respondent corporation. Petitioners then filed with the Court of Appeals a Petition for Review under Rule 42 of the 1997
Rules of Civil Procedure, as amended.
However, petitioners have stopped paying rentals. Respondent then sent letters dated September
In its Decision dated April 20, 2001, the Court of Appeals affirmed in toto the RTC Decision, thus:
12 and October 17, 1996 to petitioners demanding that they vacate the premises, but they refused
to do so. This prompted respondent to file with the MeTC a complaint for illegal detainer against
them. WHEREFORE, the petition is hereby DISMISSED. The decision of the Regional Trial
Court affirming the decision of the Metropolitan Trial Court, National Capital Judicial
Region, Mandaluyong City, Branch 60, is hereby AFFIRMED IN TOTO.
In their answer, petitioners denied specifically TTRDC's allegations in its complaint. They claimed
that the MeTC has no jurisdiction over the case since in their answer they are raising an issue of
ownership. They alleged that their father, the late Victoriano Gayoso, sold the lot (a conjugal SO ORDERED.
property) to Almeda without the consent of their mother. The sale, being void, Almeda could not
have transferred ownership of the lot to respondent corporation. Hence, the instant petition.

On July 21, 1997, the MeTC rendered its Decision, the dispositive portion of which reads: Petitioners contend that since the issue of ownership of the property in dispute is inextricably
linked with the issue of possession, the MeTC has no jurisdiction over Civil Case No. 15340.
WHEREFORE, the Court renders judgment:
For its part, respondent maintains that the real issue is who between the parties is entitled to
A. Ordering the defendants possession. Hence, the MeTC has jurisdiction to hear and decide the case.

We find for the respondent.

It is basic that a court's jurisdiction is provided by law. Section 33 of Batas Pambansa Blg. 129, as
amended, provides in part:
SEC. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts, and Municipal
Circuit Trial Courts in Civil Cases. - Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts shall exercise:
xxx
All ejectment cases are covered by the Rule on Summary Procedure and are within the
jurisdiction of the inferior courts regardless of whether they involve questions of
ownership. The courts in ejectment cases may determine questions of ownership
whenever necessary to decide the question of possession.
Verily, we hold that the Court of Appeals did not err in holding that the MeTC of Mandaluyong City
has jurisdiction to hear and decide Civil Case No. 15340, notwithstanding the issue of ownership
raised by petitioners in their answer.

(2) Exclusive original jurisdiction over cases of forcible entry and unlawful
detainer: Provided, That when, in such cases, the defendant raises the question of
ownership in his pleadings and the question of possession cannot be resolved
without deciding the question of ownership, the issue of ownership shall be
resolved only to determine the issue of possession; (Emphasis supplied)
WHEREFORE, we DENY the petition. The Decision of the Court of Appeals dated April 20, 2001
in CA-G.R. SP No. 48001 is AFFIRMED. Costs against petitioners.
SO ORDERED.

Moreover, Section 18, Rule 70 of the 1997 Rules of Civil Procedure, as amended, states that:

SEC. 18. Judgment conclusive only on possession, not conclusive in actions involving
title or ownership. – The judgment rendered in an action for forcible entry or detainer
shall be conclusive with respect to the possession only and shall in no wise bind the
title or affect the ownership of the land or building. Such judgment shall not bar an action
between the same parties respecting title to the land or building.

The judgment or final order shall be appealable to the appropriate Regional Trial Court
which shall decide the same on the basis of the entire record of the proceedings had in
the court of origin and such memoranda and/or briefs as may be submitted by the parties
or required by the Regional Trial Court.

In Barba vs. Court of Appeals,2 this Court held:

The Court has repeatedly emphasized that municipal trial courts, metropolitan trial courts,
and municipal circuit trial courts now retain jurisdiction over ejectment cases if the
question of possession cannot be resolved without passing upon the issue of ownership.
In forcible entry and unlawful detainer cases, even if the defendant raises the question of
ownership in his pleadings and the question of possession cannot be resolved without
deciding the issue of ownership, inferior courts, nonetheless, have the undoubted
competence to provisionally resolve the issue of ownership for the sole purpose of
determining the issue of possession. Such decision, however, does not bind the title or
affect the ownership of the land or building, neither shall it bar an action between the
same parties respecting title to the land or building nor be held conclusive of the facts
therein found in a case between the same parties upon a different cause of action
involving possession.

Likewise, in Tala Realty Services Corporation vs. Banco Filipino Savings and Mortgage Bank,3 this
Court ruled:
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-21450 April 15, 1968
SERAFIN TIJAM, ET AL., plaintiffs-appellees,
vs.
MAGDALENO SIBONGHANOY alias GAVINO SIBONGHANOY and LUCIA
BAGUIO, defendants,
MANILA SURETY AND FIDELITY CO., INC. (CEBU BRANCH) bonding company and defendant-
appellant.
F. S. Urot and G. A. Uriate for plaintiffs-appellees.
Carlos J. Cuizon for defendants Gavino Sibonghanoy and Lucia Baguio.
Villaluz Law Office, Velasco Law Office, Pages and Soberano for defendant-appellant Manila
Surety and Fidelity Company, Inc.
DIZON, J.:
On July 19, 1948 — barely one month after the effectivity of Republic Act No. 296 known as the
Judiciary Act of 1948 — the spouses Serafin Tijam and Felicitas Tagalog commenced Civil Case
No. R-660 in the Court of First Instance of Cebu against the spouses Magdaleno Sibonghanoy
and Lucia Baguio to recover from them the sum of P1,908.00, with legal interest thereon from the
date of the filing of the complaint until the whole obligation is paid, plus costs. As prayed for in the
complaint, a writ of attachment was issued by the court against defendants' properties, but the
same was soon dissolved upon the filing of a counter-bond by defendants and the Manila Surety
and Fidelity Co., Inc. hereinafter referred to as the Surety, on the 31st of the same month.
After being duly served with summons the defendants filed their answer in which, after making
some admissions and denials of the material averments of the complaint, they interposed a
counterclaim. This counterclaim was answered by the plaintiffs.
After trial upon the issues thus joined, the Court rendered judgment in favor of the plaintiffs and,
after the same had become final and executory, upon motion of the latter, the Court issued a writ
of execution against the defendants. The writ having been returned unsatisfied, the plaintiffs
moved for the issuance of a writ of execution against the Surety's bond (Rec. on Appeal, pp. 46-
49), against which the Surety filed a written opposition (Id. pp. 49) upon two grounds, namely, (1)
Failure to prosecute and (2) Absence of a demand upon the Surety for the payment of the amount
due under the judgment. Upon these grounds the Surety prayed the Court not only to deny the
motion for execution against its counter-bond but also the following affirmative relief : "to relieve
the herein bonding company of its liability, if any, under the bond in question" (Id. p. 54) The Court
denied this motion on the ground solely that no previous demand had been made on the Surety
for the satisfaction of the judgment. Thereafter the necessary demand was made, and upon failure
of the Surety to satisfy the judgment, the plaintiffs filed a second motion for execution against the
counterbond. On the date set for the hearing thereon, the Court, upon motion of the Surety's
counsel, granted the latter a period of five days within which to answer the motion. Upon its failure
to file such answer, the Court granted the motion for execution and the corresponding writ was
issued.
Subsequently, the Surety moved to quash the writ on the ground that the same was issued without
the required summary hearing provided for in Section 17 of Rule 59 of the Rules of Court. As the
Court denied the motion, the Surety appealed to the Court of Appeals from such order of denial
and from the one denying its motion for reconsideration (Id. p. 97). Its record on appeal was then
printed as required by the Rules, and in due time it filed its brief raising therein no other question
but the ones covered by the following assignment of errors:
I. That the Honorable Court a quo erred in issuing its order dated November 2, 1957, by
holding the incident as submitted for resolution, without a summary hearing and
compliance with the other mandatory requirements provided for in Section 17, Rule 59 of
the Rules of Court.
II. That the Honorable Court a quo erred in ordering the issuance of execution against the
herein bonding company-appellant.
III. That the Honorable Court a quo erred in denying the motion to quash the writ of
execution filed by the herein bonding company-appellant as well as its subsequent motion
for reconsideration, and/or in not quashing or setting aside the writ of execution.
Not one of the assignment of errors — it is obvious — raises the question of lack of jurisdiction,
neither directly nor indirectly.
Although the appellees failed to file their brief, the Court of Appeals, on December 11, 1962,
decided the case affirming the orders appealed from.
On January 8, 1963 — five days after the Surety received notice of the decision, it filed a motion
asking for extension of time within which to file a motion for reconsideration. The Court of Appeals
granted the motion in its resolution of January 10 of the same year. Two days later the Surety filed
a pleading entitled MOTION TO DISMISS, alleging substantially that appellees action was filed in
the Court of First Instance of Cebu on July 19, 1948 for the recovery of the sum of P1,908.00 only;
that a month before that date Republic Act No. 296, otherwise known as the Judiciary Act of 1948,
had already become effective, Section 88 of which placed within the original exclusive jurisdiction
of inferior courts all civil actions where the value of the subject-matter or the amount of the
demand does not exceed P2,000.00, exclusive of interest and costs; that the Court of First
Instance therefore had no jurisdiction to try and decide the case. Upon these premises the
Surety's motion prayed the Court of Appeals to set aside its decision and to dismiss the case. By
resolution of January 16, 1963 the Court of Appeals required the appellees to answer the motion
to dismiss, but they failed to do so. Whereupon, on May 20 of the same year, the Court resolved to
set aside its decision and to certify the case to Us. The pertinent portions of its resolution read as
follows:
 It would indeed appear from the record that the action at bar, which is a suit for collection
of money in the sum of exactly P1,908.00 exclusive of interest, was originally instituted in
the Court of First Instance of Cebu on July 19, 1948. But about a month prior to the filing
of the complaint, more specifically on June 17, 1948, the Judiciary Act of 1948 took effect,
depriving the Court of First Instance of original jurisdiction over cases in which the
demand, exclusive of interest, is not more than P2,000.00. (Secs. 44[c] and 86[b], R.A.
No. 296.)
We believe, therefore, that the point raised in appellant's motion is an important one
which merits serious consideration. As stated, the complaint was filed on July 19, 1948.
This case therefore has been pending now for almost 15 years, and throughout the entire
proceeding appellant never raised the question of jurisdiction until after receipt of this
Court's adverse decision.
There are three cases decided by the Honorable Supreme Court which may be worthy of
consideration in connection with this case, namely: Tyson Tan, et al. vs. Filipinas
Compañia de Seguros, et al., G.R. No. L-10096, March 23, 1956; Pindangan Agricultural
Co., Inc. vs. Jose P. Dans, etc., et al., G.R. No. L-14591, September 26, 1962; and
Alfredo Montelibano, et al. vs. Bacolod-Murcia Milling Co., Inc., G.R. No. L-15092,
September 29, 1962, wherein the Honorable Supreme Court frowned upon the
'undesirable practice' of appellants submitting their case for decision and then accepting
the judgment, if favorable, but attacking it for lack of jurisdiction when adverse.
Considering, however, that the Supreme Court has the "exclusive" appellate jurisdiction
over "all cases in which the jurisdiction of any inferior court is in issue" (See. 1, Par. 3[3],
Judiciary Act of 1948, as amended), we have no choice but to certify, as we hereby do
certify, this case to the Supreme Court.1äwphï1.ñët
ACCORDINGLY, pursuant to Section 31 of the Judiciary Act of 1948 as amended, let the
record of this case be forwarded to the Supreme Court.
It is an undisputed fact that the action commenced by appellees in the Court of First Instance of
Cebu against the Sibonghanoy spouses was for the recovery of the sum of P1,908.00 only — an
amount within the original exclusive jurisdiction of inferior courts in accordance with the provisions
of the Judiciary Act of 1948 which had taken effect about a month prior to the date when the action
was commenced. True also is the rule that jurisdiction over the subject matter is conferred upon
the courts exclusively by law, and as the lack of it affects the very authority of the court to take
cognizance of the case, the objection may be raised at any stage of the proceedings. However,
considering the facts and circumstances of the present case — which shall forthwith be set forth
— We are of the opinion that the Surety is now barred by laches from invoking this plea at this late
hour for the purpose of annuling everything done heretofore in the case with its active
participation.
As already stated, the action was commenced in the Court of First Instance of Cebu on July 19,
1948, that is, almostfifteen years before the Surety filed its motion to dismiss on January 12, 1963
raising the question of lack of jurisdiction for the first time.
It must be remembered that although the action, originally, was exclusively against the
Sibonghanoy spouses the Surety became a quasi-party therein since July 31, 1948 when it filed a
counter-bond for the dissolution of the writ of attachment issued by the court of origin (Record on
Appeal, pp. 15-19). Since then, it acquired certain rights and assumed specific obligations in
connection with the pending case, in accordance with sections 12 and 17, Rule 57, Rules of Court
(Bautista vs. Joaquin, 46 Phil. 885; Kimpang & Co. vs. Javier, 65 Phil. 170).
Upon the filing of the first motion for execution against the counter-bond the Surety not only filed a
written opposition thereto praying for its denial but also asked for an additional affirmative relief —
that it be relieved of its liability under the counter-bond upon the grounds relied upon in support of
its opposition — lack of jurisdiction of the court a quo not being one of them.
Then, at the hearing on the second motion for execution against the counter-bond, the Surety
appeared, through counsel, to ask for time within which to file an answer or opposition thereto.
This motion was granted, but instead of such answer or opposition, the Surety filed the motion to
dismiss mentioned heretofore.
A party may be estopped or barred from raising a question in different ways and for different
reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, and of estoppel
by laches.
Laches, in a general sense is failure or neglect, for an unreasonable and unexplained length of
time, to do that which, by exercising due diligence, could or should have been done earlier; it is
negligence or omission to assert a right within a reasonable time, warranting a presumption that
the party entitled to assert it either has abandoned it or declined to assert it.
The doctrine of laches or of "stale demands" is based upon grounds of public policy which
requires, for the peace of society, the discouragement of stale claims and, unlike the statute of
limitations, is not a mere question of time but is principally a question of the inequity or unfairness
of permitting a right or claim to be enforced or asserted.
It has been held that a party can not invoke the jurisdiction of a court to sure affirmative relief
against his opponent and, after obtaining or failing to obtain such relief, repudiate or question that
same jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79). In the case just cited, by way of
explaining the rule, it was further said that the question whether the court had jurisdiction either of
the subject-matter of the action or of the parties was not important in such cases because the
party is barred from such conduct not because the judgment or order of the court is valid and
conclusive as an adjudication, but for the reason that such a practice can not be tolerated —
obviously for reasons of public policy.
Furthermore, it has also been held that after voluntarily submitting a cause and encountering an
adverse decision on the merits, it is too late for the loser to question the jurisdiction or power of the
court (Pease vs. Rathbun-Jones etc., 243 U.S. 273, 61 L. Ed. 715, 37 S. Ct. 283; St. Louis etc. vs.
McBride, 141 U.S. 127, 35 L. Ed. 659). And in Littleton vs. Burgess, 16 Wyo. 58, the Court said
that it is not right for a party who has affirmed and invoked the jurisdiction of a court in a particular
matter to secure an affirmative relief, to afterwards deny that same jurisdiction to escape a
penalty.
Upon this same principle is what We said in the three cases mentioned in the resolution of the
Court of Appeals of May 20, 1963 (supra) — to the effect that we frown upon the "undesirable
practice" of a party submitting his case for decision and then accepting the judgment, only if
favorable, and attacking it for lack of jurisdiction, when adverse — as well as in Pindañgan etc. vs.
Dans, et al., G.R. L-14591, September 26, 1962; Montelibano, et al., vs. Bacolod-Murcia Milling
Co., Inc., G.R. L-15092; Young Men Labor Union etc. vs. The Court of Industrial Relation et al.,
G.R. L-20307, Feb. 26, 1965, and Mejia vs. Lucas, 100 Phil. p. 277.
The facts of this case show that from the time the Surety became a quasi-party on July 31, 1948, it
could have raised the question of the lack of jurisdiction of the Court of First Instance of Cebu to
take cognizance of the present action by reason of the sum of money involved which, according to
the law then in force, was within the original exclusive jurisdiction of inferior courts. It failed to do
so. Instead, at several stages of the proceedings in the court a quo as well as in the Court of
Appeals, it invoked the jurisdiction of said courts to obtain affirmative relief and submitted its case
for a final adjudication on the merits. It was only after an adverse decision was rendered by the
Court of Appeals that it finally woke up to raise the question of jurisdiction. Were we to sanction
such conduct on its part, We would in effect be declaring as useless all the proceedings had in the
present case since it was commenced on July 19, 1948 and compel the judgment creditors to go
up their Calvary once more. The inequity and unfairness of this is not only patent but revolting.
Coming now to the merits of the appeal: after going over the entire record, We have become
persuaded that We can do nothing better than to quote in toto, with approval, the decision
rendered by the Court of Appeals on December 11, 1962 as follows:
In Civil Case No. R-660 of the Court of First Instance of Cebu, which was a suit for
collection of a sum of money, a writ of attachment was issued against defendants'
properties. The attachment, however, was subsequently discharged under Section 12 of
Rule 59 upon the filing by defendants of a bond subscribed by Manila Surety & Fidelity
Co., Inc.
After trial, judgment was rendered in favor of plaintiffs.
The writ of execution against defendants having been returned totally unsatisfied,
plaintiffs moved, under Section 17 of Rule 59, for issuance of writ of execution against
Manila Surety & Fidelity Co., Inc. to enforce the obligation of the bond. But the motion
was, upon the surety's opposition, denied on the ground that there was "no showing that
a demand had been made, by the plaintiffs to the bonding company for payment of the
amount due under the judgment" (Record on Appeal, p. 60).
Hence, plaintiffs made the necessary demand upon the surety for satisfaction of the
judgment, and upon the latter's failure to pay the amount due, plaintiffs again filed a
motion dated October 31, 1957, for issuance of writ of execution against the surety, with
notice of hearing on November 2, 1957. On October 31, 1957, the surety received copy of
said motion and notice of hearing.
It appears that when the motion was called on November 2, 1957, the surety's counsel
asked that he be given time within which to answer the motion, and so an order was
issued in open court, as follows:1äwphï1.ñët
As prayed for, Atty. Jose P. Soberano, Jr., counsel for the Manila Surety &
Fidelity Co., Inc., Cebu Branch, is given until Wednesday, November 6, 1957, to
file his answer to the motion for the issuance of a writ of execution dated October
30, 1957 of the plaintiffs, after which this incident shall be deemed submitted for
resolution.
SO ORDERED.
Given in open court, this 2nd day of November, 1957, at Cebu City, Philippines.
(Sgd.) JOSE M. MENDOZA
Judge
(Record on Appeal, pp.
64-65, emphasis ours)
Since the surety's counsel failed to file any answer or objection within the period given
him, the court, on December 7, 1957, issued an order granting plaintiffs' motion for
execution against the surety; and on December 12, 1957, the corresponding writ of
execution was issued.
On December 24, 1957, the surety filed a motion to quash the writ of execution on the
ground that the same was "issued without the requirements of Section 17, Rule 59 of the
Rules of Court having been complied with," more specifically, that the same was issued
without the required "summary hearing". This motion was denied by order of February 10,
1958.
On February 25, 1958, the surety filed a motion for reconsideration of the above-stated
order of denial; which motion was likewise denied by order of March 26, 1958.
From the above-stated orders of February 10, 1958 and March 26, 1958 — denying the
surety's motion to quash the writ of execution and motion for reconsideration, respectively
— the surety has interposed the appeal on hand.
The surety insists that the lower court should have granted its motion to quash the writ of
execution because the same was issued without the summary hearing required by
Section 17 of Rule 59, which reads;
"Sec. 17. When execution returned unsatisfied, recovery had upon bond. — If the
execution be returned unsatisfied in whole or in part, the surety or sureties on
any bond given pursuant to the provisions of this role to secure the payment of
the judgment shall become finally charged on such bond, and bound to pay to
 the plaintiff upon demand the amount due under the judgment, which amount
may be recovered from such surety or sureties after notice and summary hearing
in the same action." (Emphasis ours)

Summary hearing is "not intended to be carried on in the formal manner in which ordinary
actions are prosecuted" (83 C.J.S. 792). It is, rather, a procedure by which a question is
resolved "with dispatch, with the least possible delay, and in preference to ordinary legal
and regular judicial proceedings" (Ibid, p. 790). What is essential is that "the defendant is
notified or summoned to appear and is given an opportunity to hear what is urged upon
him, and to interpose a defense, after which follows an adjudication of the rights of the
parties" (Ibid., pp. 793-794); and as to the extent and latitude of the hearing, the same will
naturally lie upon the discretion of the court, depending upon the attending circumstances
and the nature of the incident up for consideration.

In the case at bar, the surety had been notified of the plaintiffs' motion for execution and
of the date when the same would be submitted for consideration. In fact, the surety's
counsel was present in court when the motion was called, and it was upon his request
that the court a quo gave him a period of four days within which to file an answer. Yet he
allowed that period to lapse without filing an answer or objection. The surety cannot now,
therefore, complain that it was deprived of its day in court.

It is argued that the surety's counsel did not file an answer to the motion "for the simple
reason that all its defenses can be set up during the hearing of the motion even if the
same are not reduced to writing" (Appellant's brief, p. 4). There is obviously no merit in
this pretense because, as stated above, the record will show that when the motion was
called, what the surety's counsel did was to ask that he be allowed and given time to file
an answer. Moreover, it was stated in the order given in open court upon request of the
surety's counsel that after the four-day period within which to file an answer, "the incident
shall be deemed submitted for resolution"; and counsel apparently agreed, as the order
was issued upon his instance and he interposed no objection thereto.

It is also urged that although according to Section 17 of Rule 59, supra, there is no need
for a separate action, there must, however, be a separate judgment against the surety in
order to hold it liable on the bond (Appellant's Brief, p. 15). Not so, in our opinion. A bond
filed for discharge of attachment is, per Section 12 of Rule 59, "to secure the payment to
the plaintiff of any judgment he may recover in the action," and stands "in place of the
property so released". Hence, after the judgment for the plaintiff has become executory
and the execution is "returned unsatisfied" (Sec. 17, Rule 59), as in this case, the liability
of the bond automatically attaches and, in failure of the surety to satisfy the judgment
against the defendant despite demand therefor, writ of execution may issue against the
surety to enforce the obligation of the bond.

UPON ALL THE FOREGOING, the orders appealed from are hereby affirmed, with costs against
the appellant Manila Surety and Fidelity Company, Inc.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-34362 November 19, 1982
MODESTA CALIMLIM AND LAMBERTO MAGALI IN HIS CAPACITY AS ADMINISTRATOR OF
THE ESTATE OF DOMINGO MAGALI, petitioners,
vs.
HON. PEDRO A. RAMIREZ IN HIS CAPACITY AS PRESIDING JUDGE OF THE COURT OF
FIRST INSTANCE OF PANGASINAN, BRANCH I, and FRANCISCO RAMOS, respondents.
Eugenio Ramos for petitioners.
Rogelio P. Closa for respondents.
VASQUEZ, J.:
The dismissal of Civil Case No. SCC-180 filed by the herein petitioners in the respondent Court
against the private respondent is sought to be annulled and set aside by this Petition For Review
On Certiorari.
The antecedent material facts are not disputed. Sometime in 1961, a judgment for a sum of
money was rendered in favor of Independent Mercantile Corporation against a certain Manuel
Magali by the Municipal Court of Manila in Civil Case No. 85136. After said judgment became
final, a writ of execution was issued on July 31, 1961. The Notice of Levy made on September 21,
1961 on a parcel of land covered by Transfer Certificate of Title No. 9138 registered in the name
of "Domingo Magali, married to Modesta Calimlim", specified that the said levy was only against
"all rights, title, action, interest and participation of the defendant Manuel Magali over the parcel of
land described in this title. " The Certificate of Sale executed by the Provincial Sheriff of
Pangasinan on October 17, 1961 in favor of Independent Mercantile Corporation also stated that
the sale referred only to the rights and interest of Manuel Magali over the land described in TCT
No. 9138. Manuel Magali is one of the several children of Domingo Magali who had died in 1940
and herein petitioner Modesta Calimlim.
However, when the Sheriff issued the final Deed of Sale on January 25, 1963, it was erroneously
stated therein that the sale was with respect to "the parcel of land described in this title" (referring
to TCT No. 9138) and not only over the rights and interest of Manuel Magali in the same. The
execution of the said final Deed of Sale was annotated at the back of said title.
On February 23, 1967, Independent Mercantile Corporation filed a petition in the respondent Court
to compel Manuel Magali to surrender the owner's duplicate of TCT No. 9138 in order that the
same may be cancelled and a new one issued in the name of the said corporation. Not being the
registered owner and the title not being in his possession, Manuel Magali failed to comply with the
order of the Court directing him to surrender the said title. On June 20, 1967, Independent
Mercantile Corporation filed an ex-parte petition to declare TCT No. 9138 as cancelled and to
issue a new title in its name. The said petition was granted by the respondent Court and in its
Order dated July 13, 1967, it directed the issuance of a new certificate of title in the name of the
Independent Mercantile Corporation and the cancellation of TCT No. 9138. By virtue of said
Order, the Register of Deeds of Pangasinan issued a new title in the name of the corporation,
Identified as TCT No. 68568.
On November 21, 1967, petitioner Modesta Calimlim, surviving spouse of Domingo Magali, upon
learning that her husband's title over the parcel of land had been cancelled, filed a petition with the
respondent Court, sitting as a cadastral court, praying for the cancellation of TCT No. 68568. An
opposition to the said petition was filed by Independent Mercantile Corporation. After the parties
submitted their respective Memoranda, the respondent Court issued an Order dated June 3, 1968
dismissing the petition. (Rollo, pp. 31-38.)
The herein petitioners did not appeal the dismissal of the petition they filed in LRC Record No.
39492 for the cancellation of TCT No. 68568. Instead, on January 11, 1971, they filed the
complaint in Civil Case No. SCC-180 praying for the cancellation of the conveyances and sales
that had been made with respect to the property, covered by TCT No. 9138 previously registered
in the name of Domingo Magali, married to Modesta Calimlim. Named as defendant in said civil
case was herein private respondent Francisco Ramos who claimed to have bought the property
from Independent Mercantile Corporation on July 25, 1967. Private respondent Francisco Ramos,
however, failed to obtain a title over the property in his name in view of the existence of an
adverse claim annotated on the title thereof at the instance of the herein petitioners.
Private respondent Francisco Ramos filed a Motion To Dismiss Civil Case No. SCC-180 on the
ground that the same is barred by prior judgement or by statute of limitations (Rollo. pp. 42-45).
Resolving the said Motion, the respondent Court, in its Order dated April 21, 1971, dismissed Civil
Case No. SCC- 180 on the ground of estoppel by prior judgment. (Ibid., pp, 10-13.) A Motion For
Reconsideration filed by the petitioners was denied by the respondent Judge in his Order of
September 2, 1971. (Ibid., pp. 13-15.) A second Motion For Reconsideration was similarly denied
in the Order dated September 29, 197 1. (Rollo, pp. 16-17.) Hence, this Petition.
We find merit in this appeal.
It is error to consider the dismissal of the petition filed by the herein petitioner in LRC Record No.
39492 for the cancellation of TCT No. 68568 as a bar by prior judgment against the filing of Civil
Case No. SCC-180. In order to avail of the defense of res judicata, it must be shown, among
others, that the judgment in the prior action must have been rendered by a court with the proper
jurisdiction to take cognizance of the proceeding in which the prior judgment or order was
rendered. If there is lack of jurisdiction over the subject-matter of the suit or of the parties, the
judgment or order cannot operate as an adjudication of the controversy. (2 Moran Comments on
the Rules of Court, 1970 Edition, p. 364.) This essential element of the defense of bar by prior
judgment or res judicata does not exist in the case presently considered.
The petition filed by the herein petitioners in LRC Record No. 39492 was an apparent invocation
of the authority of the respondent Court sitting as a land registration court, Although the said
petition did not so state, that reliance was apparently placed on Section 112 of the Land
Registration Act. It has been settled by consistent rulings of this Court that a court of first instance,
acting as a land registration court, is a court of limited and special jurisdiction. As such, its
proceedings are not adequate for the litigation of issues pertaining to an ordinary civil action, such
as, questions involving ownership or title to real property. (Bareng vs. Shintoist Shrine and
Japanese Charity Bureau, 83 SCRA 418; Manalo vs. Mariano, 69 SCRA 80; In re: Nicanor T
Santos, 102 SCRA 747; Santos vs. Aquino, 101 SCRA 377.) In Hu chon Sunpongco vs. Heirs of
Nicolas Ronquillo, L- 27040, December 19, 1970, 36 SCRA 395, we have held that:
Section 112 of Act 496 confers authority upon the land registration court to order
the cancellation, alteration or amendment of a certificate of title but withdraws
from the Court the power to pass upon any question concerning ownership of the
registered property, or any incident where the issues involved have become
controversial.
It may hardly be questioned that the issues raised by the petitioners in their petition to cancel TCT
No. 68568 refer to the ownership or title over the property covered thereby. The said petition
presented before the respondent Court in the exercise of its limited jurisdiction as a cadastral
court, the question of who should be considered the true and lawful owner of the parcel of land
embraced in said title. The petitioners alleged therein that they are the true owners of the property,
and that TCT No. 68568 which they sought to cancel was issued as a result of the errors which
were not of their own making. In short, the petition raised a highly controversial matter which is
beyond the judicial competence of a cadastral court to pass upon or to adjudicate.
It may neither be claimed that the parties have mutually agreed to submit the aforesaid issues for
the determination by the court, it being a fact that herein private respondent was not a party in the
petition in LRC Record No. 39492. Incidentally, although the said petition was filed by the herein
petitioners on November 21, 1967, the Opposition filed by Independent Mercantile Corporation to
the said petition made no mention of the alleged sale of the property in question in favor of private
respondent Francisco Ramos on July 5, 1967. This circumstance places in grave doubt the
sincerity of said sale and the claim that the private respondent was an innocent purchaser for
value of the property in question.
In the order of the respondent Judge dated September 29, 1971 denying the second motion for
reconsideration, he cited the case of Tijam vs. Sibonghanoy, 23 SCRA 29, to uphold the view that
the petitioners are deemed estopped from questioning the jurisdiction of the respondent Court in
having taken cognizance of the petition for cancellation of TCT No. 68568, they being the ones
who invoked the jurisdiction of the said Court to grant the affirmative relief prayed for therein. We
are of the opinion that the ruling laid down in Sibonghanoy may not be applied herein. Neither its
factual backdrop nor the philosophy of the doctrine therein expounded fits the case at bar.
A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to
cite is that the jurisdiction of a court over the subject-matter of the action is a matter of law and
may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court
may be raised at any stage of the proceedings, even on appeal. This doctrine has been qualified
by recent pronouncements which stemmed principally from the ruling in the cited case
of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to
situations which were obviously not contemplated therein. The exceptional circumstance involved
in Sibonghanoy which justified the departure from the accepted concept of non-waivability of
objection to jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly
upheld that rendered the supposed ruling in Sibonghanoy not as the exception, but rather the
general rule, virtually overthrowing altogether the time-honored principle that the issue of
jurisdiction is not lost by waiver or by estoppel.
In Sibonghanoy, the defense of lack of jurisdiction of the court that rendered the questioned ruling
was held to be barred by estoppel by laches. It was ruled that the lack of jurisdiction having been
raised for the first time in a motion to dismiss filed almost fifteen (15) years after the questioned
ruling had been rendered, such a plea may no longer be raised for being barred by laches. As
defined in said case, laches is "failure or neglect, for an unreasonable and unexplained length of
time, to do that which, by exercising due diligence, could or should have been done earlier; it is
negligence or omission to assert a right within a reasonable time, warranting a presumption that
the party entitled to assert has abandoned it or declined to assert it."
The petitioners in the instant case may not be faulted with laches. When they learned that the title
to the property owned by them had erroneously and illegally been cancelled and registered in the
name of another entity or person who had no right to the same, they filed a petition to cancel the
latter's title. It is unfortunate that in pursuing said remedy, their counsel had to invoke the authority
of the respondent Court as a cadastral court, instead of its capacity as a court of general
jurisdiction. Their petition to cancel the title in the name of Independent Mercantile Corporation
was dismissed upon a finding by the respondent Court that the same was "without merit." No
explanation was given for such dismissal nor why the petition lacked merit. There was no hearing,
and the petition was resolved solely on the basis of memoranda filed by the parties which do not
appear of record. It is even a possibility that such dismissal was in view of the realization of the
respondent Court that, sitting as a cadastral court, it lacked the authority to entertain the petition
involving as it does a highly controversial issue. Upon such petition being dismissed, the
petitioners instituted Civil Case No. SCC-180 on January 1, 1971, or only two and one-half years
after the dismissal of their petition in LRC Record No. 39492. Hence, we see no unreasonable
delay in the assertion by the petitioners of their right to claim the property which rightfully belongs
to them. They can hardly be presumed to have abandoned or waived such right by inaction within
an unreasonable length of time or inexcusable negligence. In short, their filing of Civil Case No.
SCC-180 which in itself is an implied non-acceptance of the validity of the proceedings had in LRC
Record No. 39492 may not be deemed barred by estoppel by laches.
It is neither fair nor legal to bind a party by the result of a suit or proceeding which was taken
cognizance of in a court which lacks jurisdiction over the same irrespective of the attendant
circumstances. The equitable defense of estoppel requires knowledge or consciousness of the
facts upon which it is based. The same thing is true with estoppel by conduct which may be
asserted only when it is shown, among others, that the representation must have been made with
knowledge of the facts and that the party to whom it was made is ignorant of the truth of the
matter. (De Castro vs. Gineta, 27 SCRA 623.) The filing of an action or suit in a court that does not
possess jurisdiction to entertain the same may not be presumed to be deliberate and intended to
secure a ruling which could later be annulled if not favorable to the party who filed such suit or
proceeding. Instituting such an action is not a one-sided affair. It can just as well be prejudicial to
the one who filed the action or suit in the event that he obtains a favorable judgment therein which
could also be attacked for having been rendered without jurisdiction. The determination of the
correct jurisdiction of a court is not a simple matter. It can raise highly debatable issues of such
importance that the highest tribunal of the land is given the exclusive appellate jurisdiction to
entertain the same. The point simply is that when a party commits error in filing his suit or
proceeding in a court that lacks jurisdiction to take cognizance of the same, such act may not at
once be deemed sufficient basis of estoppel. It could have been the result of an honest mistake, or
of divergent interpretations of doubtful legal provisions. If any fault is to be imputed to a party
taking such course of action, part of the blame should be placed on the court which shall entertain
the suit, thereby lulling the parties into believing that they pursued their remedies in the correct
forum. Under the rules, it is the duty of the court to dismiss an action "whenever it appears that the
court has no jurisdiction over the subject matter." (Sec. 2, Rule 9, Rules of Court.) Should the
court render a judgment without jurisdiction, such judgment may be impeached or annulled for
lack of jurisdiction (Sec. 30, Rule 132, Ibid), within ten (10) years from the finality of the same. (Art.
1144, par. 3, Civil Code.)

The inequity of barring the petitioners from vindicating their right over their property in Civil Case
No. SCC-180 is rendered more acute in the face of the undisputed fact that the property in
question admittedly belonged to the petitioners, and that the title in the name of the private
respondent was the result of an error committed by the Provincial Sheriff in issuing the deed of
sale in the execution proceeding. The justness of the relief sought by herein petitioners may not
be ignored or rendered futile by reason of a doctrine which is of highly doubtful applicability herein.

WHEREFORE, the Orders appealed from are hereby REVERSED and SET ASIDE. The Motion
To Dismiss filed by the private respondent in Civil Case No. SCC-180 shall be deemed denied and
the respondent Court is ordered to conduct further proceedings in the case. With costs against the
private respondent.

SO ORDERED.
 THIRD DIVISION
[G.R. No. 144025. December 27, 2002]
SPS. RENE GONZAGA and LERIO GONZAGA, petitioners, vs. HON. COURT OF APPEALS,
Second Division, Manila, HON. QUIRICO G. DEFENSOR, Judge, RTC, Branch 36,
Sixth Judicial Region, Iloilo City, and LUCKY HOMES, INC., represented by WILSON
JESENA, JR., as Manager, respondents.
DECISION
CORONA, J.:
Before this Court is a petition for review on certiorari seeking the reversal of the decision [1] of
the Court of Appeals dated December 29, 1999 and its resolution dated June 1, 2000 in CA-G.R.
SP No. 54587.
The records disclose that, sometime in 1970, petitioner-spouses purchased a parcel of land
from private respondent Lucky Homes, Inc., situated in Iloilo and containing an area of 240 square
meters. Said lot was specifically denominated as Lot No. 19 under Transfer Certificate of Title
(TCT) No. 28254 and was mortgaged to the Social Security System (SSS) as security for their
housing loan. Petitioners then started the construction of their house, not on Lot No. 19 but on Lot
No. 18, as private respondent mistakenly identified Lot No. 18 as Lot No. 19. Upon realizing its
error, private respondent, through its general manager, informed petitioners of such mistake but
the latter offered to buy Lot No. 18 in order to widen their premises. Thus, petitioners continued
with the construction of their house. However, petitioners defaulted in the payment of their housing
loan from SSS. Consequently, Lot No. 19 was foreclosed by SSS and petitioners certificate of title
was cancelled and a new one was issued in the name of SSS. After Lot No. 19 was foreclosed,
petitioners offered to swap Lot Nos. 18 and 19 and demanded from private respondent that their
contract of sale be reformed and another deed of sale be executed with respect to Lot No. 18,
considering that their house was built therein. However, private respondent refused. This
prompted petitioners to file, on June 13, 1996, an action for reformation of contract and damages
with the Regional Trial Court of Iloilo City, Branch 36, which was docketed as Civil Case No.
17115.
On January 15, 1998, the trial court[2] rendered its decision dismissing the complaint for lack
of merit and ordering herein petitioners to pay private respondent the amount of P10,000 as moral
damages and another P10,000 as attorneys fees. The pertinent conclusion of the trial court reads
as follows:
Aware of such fact, the plaintiff nonetheless continued to stay in the premises of Lot 18 on the
proposal that he would also buy the same. Plaintiff however failed to buy Lot 18 and likewise
defaulted in the payment of his loan with the SSS involving Lot 19. Consequently Lot 19 was
foreclosed and sold at public auction. Thereafter TCT No. T-29950 was cancelled and in lieu
thereof TCT No. T-86612 (Exh. 9) was issued in favor of SSS. This being the situation obtaining,
the reformation of instruments, even if allowed, or the swapping of Lot 18 and Lot 19 as earlier
proposed by the plaintiff, is no longer feasible considering that plaintiff is no longer the owner of
Lot 19, otherwise, defendant will be losing Lot 18 without any substitute therefore (sic). Upon the
other hand, plaintiff will be unjustly enriching himself having in its favor both Lot 19 which was
earlier mortgaged by him and subsequently foreclosed by SSS, as well as Lot 18 where his house
is presently standing.
The logic and common sense of the situation lean heavily in favor of the defendant. It is evident
that what plaintiff had bought from the defendant is Lot 19 covered by TCT No. 28254 which
parcel of land has been properly indicated in the instruments and not Lot 18 as claimed by the
plaintiff. The contracts being clear and unmistakable, they reflect the true intention of the parties,
besides the plaintiff failed to assail the contracts on mutual mistake, hence the same need no
longer be reformed.[3]
On June 22, 1998, a writ of execution was issued by the trial court. Thus, on September 17,
1998, petitioners filed an urgent motion to recall writ of execution, alleging that the court a quo had
no jurisdiction to try the case as it was vested in the Housing and Land Use Regulatory Board
(HLURB) pursuant to PD 957 (The Subdivision and Condominium Buyers Protective
Decree). Conformably, petitioners filed a new complaint against private respondent with the
HLURB. Likewise, on June 30, 1999, petitioner-spouses filed before the Court of Appeals a
petition for annulment of judgment, premised on the ground that the trial court had no jurisdiction
to try and decide Civil Case No. 17115.
In a decision rendered on December 29, 1999, the Court of Appeals denied the petition for
annulment of judgment, relying mainly on the jurisprudential doctrine of estoppel as laid down in
the case of Tijam vs. Sibonghanoy.[4]
Their subsequent motion for reconsideration having been denied, petitioners filed this instant
petition, contending that the Court of Appeals erred in dismissing the petition by applying the
principle of estoppel, even if the Regional Trial Court, Branch 36 of Iloilo City had no jurisdiction to
decide Civil Case No. 17115.
At the outset, it should be stressed that petitioners are seeking from us the annulment of a
trial court judgment based on lack of jurisdiction. Because it is not an appeal, the correctness of
the judgment is not in issue here. Accordingly, there is no need to delve into the propriety of the
decision rendered by the trial court.
Petitioners claim that the recent decisions of this Court have already abandoned the doctrine
laid down in Tijam vs. Sibonghanoy.[5] We do not agree. In countless decisions, this Court has
consistently held that, while an order or decision rendered without jurisdiction is a total nullity and
may be assailed at any stage, active participation in the proceedings in the court which rendered
the order or decision will bar such party from attacking its jurisdiction. As we held in the leading
case of Tijam vs. Sibonghanoy:[6]
A party may be estopped or barred from raising a question in different ways and for different
reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, and of estoppel by
laches.
xxx

It has been held that a party cannot invoke the jurisdiction of a court to secure affirmative relief
against his opponent and, after obtaining or failing to obtain such relief, repudiate, or question that
same jurisdiction x x x x [T]he question whether the court had jurisdiction either of the subject
matter of the action or of the parties was not important in such cases because the party is barred
from such conduct not because the judgment or order of the court is valid and conclusive as an
adjudication, but for the reason that such a practice can not be tolerated obviously for reasons of
public policy.

Tijam has been reiterated in many succeeding cases. Thus, in Orosa vs. Court of
Appeals;[7] Ang Ping vs. Court of Appeals;[8] Salva vs. Court of Appeals;[9] National Steel
Corporation vs. Court of Appeals;[10] Province of Bulacan vs. Court of Appeals;[11] PNOC Shipping
and Transport Corporation vs. Court of Appeals,[12] this Court affirmed the rule that a partys active
participation in all stages of the case before the trial court, which includes invoking the courts
authority to grant affirmative relief, effectively estops such party from later challenging that same
courts jurisdiction.
In the case at bar, it was petitioners themselves who invoked the jurisdiction of the court a
quo by instituting an action for reformation of contract against private respondents. It appears that,
in the proceedings before the trial court, petitioners vigorously asserted their cause from start to
finish. Not even once did petitioners ever raise the issue of the courts jurisdiction during the entire
proceedings which lasted for two years. It was only after the trial court rendered its decision and
issued a writ of execution against them in 1998 did petitioners first raise the issue of jurisdiction ─
and it was only because said decision was unfavorable to them. Petitioners thus effectively waived
their right to question the courts jurisdiction over the case they themselves filed.
Petitioners should bear the consequence of their act. They cannot be allowed to profit from
their omission to the damage and prejudice of the private respondent. This Court frowns upon the
undesirable practice of a party submitting his case for decision and then accepting the judgment
but only if favorable, and attacking it for lack of jurisdiction if not. [13]
Public policy dictates that this Court must strongly condemn any double-dealing by parties
who are disposed to trifle with the courts by deliberately taking inconsistent positions, in utter
disregard of the elementary principles of justice and good faith. [14] There is no denying that, in this
case, petitioners never raised the issue of jurisdiction throughout the entire proceedings in the trial
court.Instead, they voluntarily and willingly submitted themselves to the jurisdiction of said court. It
is now too late in the day for them to repudiate the jurisdiction they were invoking all along.
WHEREFORE, the petition for review is hereby DENIED.
SO ORDERED.
 THIRD DIVISION Once more, petitioner issued another notice to move-in addressed to its building administrator
advising the latter that respondent is scheduled to move in on August 22, 1990.
G.R. No. 139791 December 12, 2003
On October 5, 1990, respondent returned to the Philippines only to find that his condominium unit
MANILA BANKERS LIFE INSURANCE CORPORATION, petitioner, was still unlivable. Exasperated, he was constrained to send petitioner a letter dated November
vs. 21, 1990 demanding payment for the damages he sustained. But petitioner ignored such demand,
EDDY NG KOK WEI, respondent. prompting respondent to file with the Regional Trial Court, Branch 150, Makati City, a complaint
against the former for specific performance and damages, docketed as Civil Case No. 90-3440.
DECISION
Meanwhile, during the pendency of the case, respondent finally accepted the condominium unit
and on April 12, 1991, occupied the same. Thus, respondent’s cause of action has been limited to
SANDOVAL-GUTIERREZ, J.:
his claim for damages.

Before us is a petition for review on certiorari assailing the Decision 1 dated March 26, 1999 and On December 18, 1992, the trial court rendered a Decision3 finding the petitioner liable for
Resolution2 dated August 5, 1999 of the Court of Appeals in CA-G.R. CV No. 40504, entitled payment of damages due to the delay in the performance of its obligation to the respondent. The
"Eddy Ng Kok Wei vs. Manila Bankers Life Insurance Corporation". dispositive portion reads:

The factual antecedents as borne by the records are:

"WHEREFORE, judgment is hereby rendered in favor of plaintiff and against defendant, ordering
Manila Bankers Life Insurance Corporation to pay plaintiff Eddy Ng Kok Wei the following:
Eddy Ng Kok Wei, respondent, is a Singaporean businessman who ventured into investing in the
Philippines. On November 29, 1988, respondent, in a Letter of Intent addressed to Manila Bankers 1. One percent (1%) of the total amount plaintiff paid defendant;
Life Insurance Corporation, petitioner, expressed his intention to purchase a condominium unit at
Valle Verde Terraces.
2. ₱100,000.00 as moral damages;
Subsequently or on December 5, 1988, respondent paid petitioner a reservation fee of ₱50,000.00
for the purchase of a 46-square meter condominium unit (Unit 703) valued at ₱860,922.00. On 3. ₱50,000.00 as exemplary damages;
January 16, 1989, respondent paid 90% of the purchase price in the sum of ₱729,830.00.
4. ₱25,000.00 by way of attorney’s fees; and
Consequently, petitioner, through its President, Mr. Antonio G. Puyat, executed a Contract to Sell
in favor of the respondent. The contract expressly states that the subject condominium unit "shall Cost of suit.
substantially be completed and delivered" to the respondent "within fifteen (15) months" from
February 8, 1989 or on May 8, 1990, and that "(S)hould there be no substantial completion and "SO ORDERED."
fail(ure) to deliver the unit on the date specified, a penalty of 1% of the total amount paid (by
respondent) shall be charged against (petitioner)".
On appeal, the Court of Appeals, in a Decision dated March 26, 1999, affirmed in toto the trial
court’s award of damages in favor of the respondent.
Considering that the stipulated 15-month period was at hand, respondent returned to the
Philippines sometime in April, 1990.
Unsatisfied, petitioner filed a motion for reconsideration but was denied by the Appellate Court in a
Resolution dated August 5, 1999.
In a letter dated April 5, 1990, petitioner, through its Senior Assistant Vice-President, Mr. Mario G.
Zavalla, informed respondent of the substantial completion of his condominium unit, however, due
to various uncontrollable forces (such as coup d‘ etat attempts, typhoon and steel and cement Hence, this petition for review on certiorari. Petitioner contends that the trial court has no
shortage), the final turnover is reset to May 31, 1990.1âwphi1 jurisdiction over the instant case; and that the Court of Appeals erred in affirming the trial court’s
finding that petitioner incurred unreasonable delay in the delivery of the condominium unit to
respondent.
Meanwhile, on July 5, 1990, upon receipt of petitioner’s notice of delivery dated May 31, 1990,
respondent again flew back to Manila. He found the unit still uninhabitable for lack of water and
electric facilities. On petitioner’s contention that the trial court has no jurisdiction over the instant case, Section 1 (c)
of Presidential Decree No. 1344, as amended, provides:
"SECTION 1. – In the exercise of its functions to regulate the real estate trade and business and in
addition to its powers provided for in Presidential Decree No. 957, the National Housing Authority
[now Housing and Land Use Regulatory Board (HLURB)] 4 shall have exclusive jurisdiction to hear
and decide cases of the following nature:

xxx

"C. Cases involving specific performance of contractual and statutory obligations filed by buyers of
subdivision lots or condominium units against the owner, developer, dealer, broker or salesman.

x x x."

Pursuant to the above provisions, it is the HLURB which has jurisdiction over the instant case. We
have consistently held that complaints for specific performance with damages by a lot or
condominium unit buyer against the owner or developer falls under the exclusive jurisdiction of the
HLURB.5

While it may be true that the trial court is without jurisdiction over the case, petitioner’s active
participation in the proceedings estopped it from assailing such lack of it. We have held that it is
an undesirable practice of a party participating in the proceedings and submitting its case for
decision and then accepting the judgment, only if favorable, and attacking it for lack of jurisdiction,
when adverse.6

Here, petitioner failed to raise the question of jurisdiction before the trial court and the Appellate
Court. In effect, petitioner confirmed and ratified the trial court’s jurisdiction over this case.
Certainly, it is now in estoppel and can no longer question the trial court’s jurisdiction.

On petitioner’s claim that it did not incur delay, suffice it to say that this is a factual issue. Time and
again, we have ruled that "the factual findings of the trial court are given weight when supported
by substantial evidence and carries more weight when affirmed by the Court of
Appeals."7 Whether or not petitioner incurred delay and thus, liable to pay damages as a
result thereof, are indeed factual questions.

The jurisdiction of this Court in a petition for review on certiorari under Rule 45 of the 1997 Rules
of Civil Procedure, as amended, is limited to reviewing only errors of law, not of fact, unless the
factual findings being assailed are not supported by evidence on record or the impugned judgment
is based on a misapprehension of facts.8 These exceptions are not present here.

WHEREFORE, the petition is DENIED. The assailed Decision dated March 26, 1999 and
Resolution dated August 5, 1999 of the Court of Appeals are hereby AFFIRMED IN TOTO.

Costs against the petitioner.

SO ORDERED.
 FIRST DIVISION
G.R. No. 151821 April 14, 2004
BANK OF THE PHILIPPINE ISLANDS, as Successor-in-Interest of BPI Investment
Corporation, petitioner,
vs.
ALS MANAGEMENT & DEVELOPMENT CORP., respondent.
DECISION
PANGANIBAN, J.:
Factual findings of the lower courts are entitled to great respect, but may be reviewed if they do
not conform to law and to the evidence on record. In the case at bar, a meticulous review of the
facts compels us to modify the award granted by the Court of Appeals.
The Case
Before us is a Petition for Review1 under Rule 45 of the Rules of Court, seeking to set aside the
November 24, 2000 Decision2 and the January 9, 2002 Resolution3 of the Court of Appeals (CA) in
CA-GR CV No. 25781. The assailed Decision disposed as follows:
"WHEREFORE, premises considered, the assailed decision is hereby AFFIRMED in
toto and the instant appeal DISMISSED."4
The assailed Resolution denied reconsideration.
The Facts
The facts of the case are narrated by the appellate court as follows:
"On July 29, 1985, [petitioner] BPI Investment Corporation filed a complaint for a Sum of
Money against ALS Management and Development Corporation, alleging inter alia that
on July 22, 1983, [petitioner] and [respondent] executed at Makati, Metro Manila a Deed
of Sale for one (1) unfurnished condominium unit of the Twin Towers Condominium
located at Ayala Avenue, corner Apartment Ridge Street, Makati, Metro Manila
designated as Unit E-4A comprising of 271 squares [sic] meters more or less, together
with parking stalls identified as G022 and G-63. The Condominium Certificate of Title No.
4800 of the Registry of Deeds for Makati, Metro Manila was issued after the execution of
the said Deed of Sale. [Petitioner] advanced the amount of ₱26,300.45 for the expenses
in causing the issuance and registration of the Condominium Certificate of Title. Under
the penultimate paragraph of the Deed of Sale, it is stipulated that the VENDEE
[respondent] shall pay all the expenses for the preparation and registration of this Deed of
Sale and such other documents as may be necessary for the issuance of the
corresponding Condominium Certificate of Title. After the [petitioner] complied with its
obligations under the said Deed of Sale, [respondent], notwithstanding demands made by
[petitioner], failed and refused to pay [petitioner] its legitimate advances for the expenses
mentioned above without any valid, legal or justifiable reason.
"In its Answer with Compulsory Counterclaim, [respondent] averred among others that it
has just and valid reasons for refusing to pay [petitioner’s] legal claims. In clear and direct
contravention of Section 25 of Presidential Decree No. 957 which provides that ‘No fee
except those required for the registration of the deed of sale in the Registry of Deeds shall
be collected for the issuance of such title’, the [petitioner] has jacked-up or increased the
amount of its alleged advances for the issuance and registration of the Condominium
Certificate of Title in the name of the [respondent], by including therein charges which
should not be collected from buyers of condominium units. [Petitioner] made and
disseminated brochures and other sales propaganda in and before May 1980, which
made warranties as to the facilities, improvements, infrastructures or other forms of
development of the condominium units (known as ‘The Twin Towers’) it was offering for
sale to the public, which included the following:
‘The Twin Towers is destined to reflect condominium living at its very best.’
‘While the twin tower design and its unusual height will make the project the only
one of its kind in the Philippines, the human scale and proportion [are] carefully
maintained.’
‘To be sure, modern conveniences are available as in the installation of an
intercom system and a closed-circuit TV monitor through which residents from
their apartments can see their guests down at the lobby call station.’
‘Some of the features of each typical apartment unit are: x x x A bar x x x Three
toilets with baths x x x.’
‘The penthouse units are privileged with the provision of an all-around balcony. x
x x’
"[Respondent] further averred that [petitioner] represented to the [respondent] that the
condominium unit will be delivered completed and ready for occupancy not later than
December 31, 1981. [Respondent] relied solely upon the descriptions and warranties
contained in the aforementioned brochures and other sales propaganda materials when
[respondent] agreed to buy Unit E-4A of the Twin Tower(s) for the hefty sum of
₱2,048,900.00 considering that the Twin Towers was then yet to be built. In contravention
of [petitioner’s] warranties and of good engineering practices, the condominium unit
purchased by [respondent] suffered from the following defects and/or deficiencies:
‘1. The clearance in the walkway at the balcony is not sufficient for passage;
‘2. The anodized aluminum used in the door and windows were damaged;
 ‘3. The kitchen counter tops/splashboard suffered from cracks and were mis-cut
and misaligned;
‘4. The partition between living and master’s bedroom was unpainted and it had
no access for maintenance due to aluminum fixed glass cover;
‘5. The varifold divider, including the bar and counter top cabinet were not
installed;
‘6. The toilets had no tiles;
‘7. No closed circuit TV was installed;
‘8. Rainwater leaks inside or into the condominium unit.’"5
Respondent’s Answer prayed that "judgment be rendered ordering [petitioner] to correct such
defects/deficiencies in the condominium unit,"6 and that the following reliefs be granted:
"1. The sum of ₱40,000.00 plus legal interest thereon from the date of extra-judicial
demand, representing the amount spent by the defendant for the completion works it had
undertaken on the premises.
"2. The sum of U.S.$6,678.65 (or its equivalent in the Philippine currency) representing
the unearned rental of the premises which the defendant did not realize by reason of the
late delivery to him of the condominium unit;
"3. Twenty-four percent (24%) interest per annum on the agreed one (1) year advance
rental and one (1) month deposit (totaling U.S.$15,785.00) corresponding to the period
January 1, 1982 to June 17, 1982, which [petitioner] would have earned had he deposited
the said amount in a bank;
"4. The sum of U.S.$1,214.30 per month, commencing from May 1, 1985, which the
[respondent] no longer earns as rental on the premises because the lessee vacated the
same by reason of defects and/or deficiencies;
"5. The sum of ₱50,000.00 plus appearance fees of ₱300.00 per court hearing, as
attorney’s fees;
"6. Litigation expenses and costs of suit."7
On February 6, 1990, the trial court issued this judgment:
"1. Ordering the [respondent] to pay [petitioner] the sum of ₱26,300.45, with legal interest
from the filing of the complaint up to full payment thereof, representing the amount spent
for the registration of the title to the condominium unit in [respondent’s] name;
"2. Ordering [petitioner] to deliver, replace or correct at [petitioner’s] exclusive
expense/cost or appoint a licensed qualified contractor to do the same on its behalf, the
following defects/deficiencies in the condominium unit owned by the [respondent]:
a) KITCHEN
i) The sides of the kitchen sink covered with sealants as well as miscut
marble installed as filler at the right side of the sink;
ii) Miscut marble installed on both sides of the side wall above the gas
range;
b) FOYERS
Water marks at the parquet flooring, near the main water supply room;
c) MAIDS ROOM
Ceiling cut off about one (1) square foot in size and left unfinished
d) DINING ROOM
i) Water damaged parquet up to about one (1) meter from the wall
underneath the open shelves and directly behind the plant box;
ii) Plant box directly behind the dining room;
iii) The water damaged parquet flooring near the door of the dining room
to the passage way
e) MASTER’S BEDROOM
i) Falling off paint layers at the bathroom wall behind the bathtub/faucet
along the passageway of the master’s bedroom;
ii) Falling off water-damaged plywood ceiling in the master’s bedroom
bathroom;
iii) Grinders mark damage at the bathtub;
f) BALCONY WALKWAY
i) PVC pipes installed two (2) inches above floor level causing water to
accumulate;
 ii) Cracks on level of wash out flooring;
iii) 14-inches passageway going to the open terrace not sufficient as
passageway;
iv) PVC pipe installed on the plant box water drained directly on the
balcony floor;
g) BALCONY (OPEN) TERRACE
i) Two (2) concrete cement measuring about 6 x 4 inches with protruding
live wires, purportedly lamp posts which were not installed;
h) BOYS BEDROOM
i) Water mark on the parquet flooring due to water seepage;
ii) Asphalt plastered at the exterior wall/floor joints to prevent water
seepage;
i) ANALOC FINISH of the aluminum frames of doors and windows all around the
condominium were painted with dark gray paint to cover dents and scratches;
j) LIVING ROOM
Intercom equipment installed without the TV monitor;
k) STORAGE FACILITIES at the ground floor
"3. Ordering [petitioner] to pay [respondent] the following:
a) The sum of ₱40,000.00 representing reimbursement for expenses incurred for
the materials/labor in installing walls/floor titles in 2 bathrooms and bar counter
cabinet.
b) The sum of ₱136,608.75, representing unearned income for the five-month
period that the defendant had to suspend a lease contract over the premises.
c) The sum of ₱27,321.75 per month for a period of twenty-one (21) months
(from May 1985 to January 1987), representing unearned income when
defendant’s lessee had to vacate the premises and condominium unit remained
vacant, all with legal interest from the filing of the counterclaim until the same are
fully paid."8
Ruling of the Court of Appeals
On appeal, after "a thorough review and examination of the evidence on record,"9 the CA found
"no basis for disbelieving what the trial court found and arrived at."10
The appellate court sustained the trial court’s finding that "while [petitioner] succeeded in proving
its claim against the [respondent] for expenses incurred in the registration of [the latter’s] title to
the condominium unit purchased, x x x for its part [respondent] in turn succeeded in establishing
an even bigger claim under its counterclaim."11
Hence, this Petition.12
The Issues
Petitioner raises the following issues for our consideration:
"I. Whether or not the Honorable Court of Appeals erred in not holding that the trial court
had no jurisdiction over the respondent’s counterclaims.
"II. Whether or not the decision of the Court of Appeals is based on misapprehension of
facts and/or manifestly mistaken warranting a review by this Honorable Court of the
factual findings therein.
"III. Whether or not the award of damages by the Honorable Court of Appeals is
conjectural warranting a review by this Honorable Court of the factual findings therein."13
The Court’s Ruling
The Petition is partly meritorious.
First Issue:
Jurisdiction
Contending that it was the Housing and Land Use Regulatory Board (HLURB) -- not the RTC --
that had jurisdiction over respondent’s counterclaim, petitioner seeks to nullify the award of the
trial court.
Promulgated on July 12, 1976, PD No. 957 -- otherwise known as "The Subdivision and
Condominium Buyers’ Protective Decree" -- provides that the National Housing Authority (NHA)
shall have "exclusive authority to regulate the real estate trade and business."14 Promulgated later
on April 2, 1978, was PD No. 1344 entitled "Empowering the National Housing Authority to Issue
Writs of Execution in the Enforcement of Its Decisions Under Presidential Decree No. 957." It
expanded the jurisdiction of the NHA as follows:
 "SECTION 1. In the exercise of its function to regulate the real estate trade and business
and in addition to its powers provided for in Presidential Decree No. 957, the National
Housing Authority shall have exclusive jurisdiction to hear and decide cases of the
following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer, broker or
salesman; and
C. Cases involving specific performance of contractual and statutory obligations
filed by buyers of subdivision lot or condominium unit against the owner,
developer, broker or salesman." (Italics ours.)
On February 7, 1981, by virtue of Executive Order No. 648, the regulatory functions of the NHA
were transferred to the Human Settlements Regulatory Commission (HSRC). Section 8 thereof
provides:
"SECTION 8. Transfer of Functions. - The regulatory functions of the National Housing
Authority pursuant to Presidential Decree Nos. 957, 1216, 1344 and other related laws
are hereby transferred to the Commission (Human Settlements Regulatory Commission).
x x x. Among these regulatory functions are: 1) Regulation of the real estate trade and
business; x x x 11) Hear and decide cases of unsound real estate business practices;
claims involving refund filed against project owners, developers, dealers, brokers, or
salesmen; and cases of specific performance."
Pursuant to Executive Order No. 90 dated December 17, 1986, the functions of the HSRC were
transferred to the HLURB.
As mandated by PD No. 957, the jurisdiction of the HLURB is encompassing. Hence, we said
in Estate Developers and Investors Corporation v. Sarte:15
"x x x. While PD 957 was designed to meet the need basically to protect lot buyers from
the fraudulent manipulations of unscrupulous subdivision owners, sellers and operators,
the ‘exclusive jurisdiction’ vested in the NHA is broad and general -‘to regulate the real
estate trade and business’ in accordance with the provisions of said law."
Furthermore, the jurisdiction of the HLURB over cases enumerated in Section 1 of PD No. 1344
is exclusive. Thus, we have ruled that the board has sole jurisdiction in a complaint of specific
performance for the delivery of a certificate of title to a buyer of a subdivision lot; 16 for claims of
refund regardless of whether the sale is perfected or not;17 and for determining whether there is a
perfected contract of sale.18
In Solid Homes v. Payawal,19 we declared that the NHA had the competence to award damages
as part of the exclusive power conferred upon it -- the power to hear and decide "claims involving
refund and any other claimsfiled by subdivision lot or condominium unit buyers against the project
owner, developer, dealer, broker or salesman."20
Clearly then, respondent’s counterclaim -- being one for specific performance (correction of
defects/deficiencies in the condominium unit) and damages -- falls under the jurisdiction of the
HLURB as provided by Section 1 of PD No. 1344.
The Applicability of Estoppel
The general rule is that any decision rendered without jurisdiction is a total nullity and may be
struck down at any time, even on appeal before this Court.21 Indeed, the question of jurisdiction
may be raised at any time, provided that such action would not result in the mockery of the tenets
of fair play.22 As an exception to the rule, the issue may not be raised if the party is barred by
estoppel.23
In the present case, petitioner proceeded with the trial, and only after a judgment unfavorable to it
did it raise the issue of jurisdiction. Thus, it may no longer deny the trial court’s jurisdiction, for
estoppel bars it from doing so. This Court cannot countenance the inconsistent postures petitioner
has adopted by attacking the jurisdiction of the regular court to which it has voluntarily submitted. 24
The Court frowns upon the undesirable practice of submitting one’s case for decision, and then
accepting the judgment only if favorable, but attacking it for lack of jurisdiction if it is not.25
We also find petitioner guilty of estoppel by laches for failing to raise the question of jurisdiction
earlier. From the time that respondent filed its counterclaim on November 8, 1985, the former
could have raised such issue, but failed or neglected to do so. It was only upon filing its appellant’s
brief26 with the CA on May 27, 1991, that petitioner raised the issue of jurisdiction for the first time.
In Tijam v. Sibonghanoy,27 we declared that the failure to raise the question of jurisdiction at an
earlier stage barred the party from questioning it later. Applying the rule on estoppel by laches, we
explained as follows:
"A party may be estopped or barred from raising a question in different ways and for
different reasons. Thus, we speak of estoppel in pais, of estoppe[l] by deed or by record,
and of estoppel by laches.
"Laches, in general sense, is failure or neglect, for an unreasonable and unexplained
length of time, to do that which, by exercising due diligence, could or should have been
done earlier; it is negligence or omission to assert a right within a reasonable time,
warranting a presumption that the party entitled to assert it either has abandoned it or
declined to assert it.
"The doctrine of laches or of ‘stale demands’ is based upon grounds of public policy which
requires, for the peace of society, the discouragement of stale claims and, unlike the
statute of limitations, is not a mere question of time but is principally a question of the
inequity or unfairness of permitting a right or claim to be enforced or asserted."28
Thus, we struck down the defense of lack of jurisdiction, since the appellant therein failed to raise
the question at an earlier stage. It did so only after an adverse decision had been rendered.
We further declared that if we were to sanction the said appellant’s conduct, "we would in effect be
declaring as useless all the proceedings had in the present case since it was commenced x x x
and compel the judgment creditors to go up their Calvary once more. The inequity and unfairness
of this is not only patent but revolting."29
Applicable herein is our ruling in Gonzaga v. Court of Appeals,30 in which we said:
"Public policy dictates that this Court must strongly condemn any double-dealing by
parties who are disposed to trifle with the courts by deliberately taking inconsistent
positions, in utter disregard of the elementary principles of justice and good faith. There is
no denying that, in this case, petitioners never raised the issue of jurisdiction throughout
the entire proceedings in the trial court. Instead, they voluntarily and willingly submitted
themselves to the jurisdiction of said court. It is now too late in the day for them to
repudiate the jurisdiction they were invoking all along."31
Second and Third Issues:
Appreciation of Facts
It is readily apparent that petitioner is raising issues of fact that have been ruled upon by the RTC
and sustained by the CA. The factual findings of lower courts are generally binding upon this Court
and will not be disturbed on appeal, especially when both sets of findings are the
same.32 Nevertheless, this rule has certain exceptions,33 as when those findings are not supported
by the evidence on record.
We have carefully scrutinized the records of this case and found reason to modify the award to
conform to law and the evidence. We thus address the arguments of petitioner seriatim.
Warranties and Representations in the Brochure
The brochure that was disseminated indicated features that would be provided each condominium
unit; and that, under Section 19 of PD No. 957, would form part of the sales warranties of
petitioner.34 Respondent relied on the brochure in its decision to purchase a unit. 35 Since the
former failed to deliver certain items stated therein, then there was a clear violation of its
warranties and representations.
The brochure says that "[t]he particulars stated x x x as well as the details and visuals shown x x x
are intended to give a general idea of the project to be undertaken, and as such, are not to be
relied [upon] as statements or representations of fact."36 This general disclaimer should apply only
to the general concept of the project that petitioner aptly characterizes thus:
"’x x x [D]estined to reflect condominium living at its very best’ and ‘its design x x x will
make the project the only one of its kind in the Philippines.’"37
This disclaimer, however, should not apply to the features and the amenities that the brochure
promised to provide each condominium unit. Petitioner was thus in breach when it failed to deliver
a "closed-circuit TV monitor through which residents from their apartments can see their guests x
x x."38
Storage Facilities
The trial court erred, though, in requiring petitioner to provide storage facilities on the ground floor,
as the non-delivery had not been alleged in respondent’s Answer with Counterclaim.39
It is elementary that a judgment must conform to and be supported by both the pleadings and the
evidence, and that it be in accordance with the theory of the action on which the pleadings were
framed and the case was tried.40Indeed, issues in each case are limited to those presented in the
pleadings.41
We are aware that issues not alleged in the pleadings may still be decided upon, if tried with the
parties’ express or implied consent.42 Trial courts are not precluded from granting reliefs not
specifically claimed in the pleadings -- notwithstanding the absence of their amendment -- upon
the condition that evidence has been presented properly, with full opportunity on the part of the
opposing parties to support their respective contentions and to refute each other’s evidence. 43 This
exception is not present in the case at bar.
Moreover, a cursory reading of the brochure shows that there is no promise to provide individual
storage facilities on the ground floor for each condominium unit. The brochure reads: "Storage
facilities in the apartment units and the ground floor."44 Apparent from the letter of petitioner dated
June 18, 1982,45 was its compliance with its promise of storage facilities on the ground floor. In
that letter, respondent was also informed that it may course a reservation of those facilities
through the building superintendent.
Damages for Delay in Delivery
It is undisputed that petitioner sent respondent a "Contract to Sell"46 declaring that the construction
would be finished on or before December 31, 1981.47 The former delivered the condominium unit
only in June 1982;48 thus, the latter claims that there was a delay in the delivery.
Because of this delay, the trial court ordered petitioner to pay damages of ₱136,608.75
representing unearned income for the period that respondent had to suspend a lease contract. We
find a dearth of evidence to support such award.
To recover actual damages, the amount of loss must not only be capable of proof, but also be
proven with a reasonable degree of certainty.49 The lone evidence for this award was the self-
serving testimony of respondent’s witness that a lease contract had indeed been intended to
commence in January 1982, instead of the actual implementation on June 18, 1982. 50 Without any
other evidence, we fail to see how the amount of loss was proven with a reasonable degree of
certainty.
Condominium Defects
The rule is that a party’s case must be established through a "preponderance of evidence."51 By
such term of evidence is meant simply evidence that is of greater weight, or is more convincing
than that which is offered in opposition to it.52 Respondent was able to establish through its
witness’ testimony that the condominium unit suffered from defects.53 This testimony was
confirmed by an inspection report54 noted and signed by petitioner’s representative, as well as by
a commissioner’s report55 prepared after an ocular inspection by the clerk of court acting as a
commissioner. Furthermore, this conclusion is supported by the circumstances that occurred
during the lease period, as evidenced by the complaint and the update letters 56 of respondent’s
lessee.
Petitioner’s contention that the claim arising from the alleged defects has already prescribed must
fail for being raised for the first time only on appeal.57 Well-settled is the rule that issues not raised
below cannot be resolved on review in higher courts.58
We agree, however, that the lower courts erred in finding that there was a defect in a portion of the
balcony, which respondent alleges to be a "walkway x x x [that] is not sufficient for
passage."59 Petitioner was able to prove, however, that the specifications thereof conformed to the
building plan.
Respondent contends that this portion should have been 65 to 80 centimeters wide, so that it
would be sufficient as a passageway.60 The building plan61 had not specified the width, however.
Architect Leo Ramos of W.V. Coscolluela & Associates, the architectural firm that prepared the
building plan, testified thus:
"Q I am directing your attention xxx to a certain portion in this condominium unit x x x it
appears x x x [that] there is no measurement indicated therein, do you know why the
measurement of said portion was not indicated in the building plan?
A Normally, it is variable.
Q What do you mean by variable?
A It depends on the actual measurement of the building construction.
Q Could you please tell the Court, what x x x the purpose of the said portion of the
condominium unit [is]?
A It is used for watering the plants and the servicing of some area[s].
Q How much measurement is made to affix the portion of watering the plants?
A Approximately .50 [m]."62
Respondent maintains that this portion should have been .80 meters (or 80 centimeters), similar to
another area in the building plan that it offered as Exhibit "2-A."63 But an analysis of this plan
reveals that the latter area has a different width from that of the former.
It is readily apparent from the foregoing facts that the portion in controversy was not intended to
be a walkway. Thus, there was no deviation from the building plan. Because it has not been
shown that this section was insufficient to serve the purpose for which it was intended, the lower
courts erred in considering it as defective.
Reimbursement of ₱40,000 for Completion Work
The lower courts did not err in ordering petitioner to correct the defects in the condominium unit,
but in requiring it to reimburse respondent in the amount of ₱40,000 for completion work done.
Petitioner argues that the trial court’s Decision encompassed the areas beyond those alleged in
respondent’s Answer.64 This contention is not convincing, because the allegations in the latter
were broad enough to cover all the defects in the condominium unit. In fact, respondent prayed
that "judgment be rendered ordering [petitioner] to correct such defects x x x in the condominium
unit as may be prove[d] during the trial."65
Petitioner further challenges the award of ₱40,000 as reimbursement for completion work done by
respondent, on the ground that this claim was not proven during the trial. The latter’s evidence
partook of a witness’ testimony66and of a demand letter67 sent to petitioner requesting
reimbursement for completion work done. Petitioner argues that respondent should have
presented receipts to support the expenses.68
We agree with petitioner. While respondent may have suffered pecuniary losses for completion
work done, it failed to establish with reasonable certainty the actual amount spent. The award of
actual damages cannot be based on the allegation of a witness without any tangible document,
such as receipts or other documentary proofs to support such claim. 69 In determining actual
damages, courts cannot rely on mere assertions, speculations, conjectures or guesswork, but
must depend on competent proof and on the best obtainable evidence of the actual amount of
loss.70
Unearned Lease Income
Respondent entered into a lease contract with Advanced Micro Device on May 18, 1982, for the
period June 18, 1982 to June 17, 1983, with option to renew.71 The lease -- which was for an
agreed monthly rental of ₱17,000 -- was renewed for a period ending May 1, 1985, when
Advanced Micro Device vacated the unit.72 On the basis of these facts, the trial court ordered
petitioner to pay damages by way of unrealized income for twenty-one months or from May 1,
1985, until January 1987 -- when respondent decided to move into the condominium unit, which
was unoccupied by then.
Despite the defects of the condominium unit, a lessee stayed there for almost three years. 73 The
damages claimed by respondent is based on the rent that it might have earned, had Advanced
Micro Device chosen to stay and renew the lease. Such claim is highly speculative, considering
that respondent failed to adduce evidence that the unit had been offered for lease to others, but
that there were no takers because of the defects therein. Speculative damages are too remote to
be included in an accurate estimate thereof.74 Absent any credible proof of the amount of actual
damage sustained, the Court cannot rely on speculations as to its existence and amount.75

We recognize, however, that respondent suffered damages when its lessee vacated the
condominium unit on May 1, 1985, because of the defects therein. Respondents are thus entitled
to temperate damages.76 Under the circumstances, the amount equivalent to three monthly rentals
of ₱17,000 -- or a total of ₱51,000 -- would be reasonable.

WHEREFORE, this Petition is PARTLY GRANTED, and the assailed Decision and Resolution of
the Court of Appeals MODIFIED, as follows:

Hereby DELETED is the requirement on the part of petitioner to (1) deliver storage
facilities on the ground floor; (2) pay ₱136,608.75 for unearned income for the five-month
period that the lease contract was allegedly suspended; (3) correct the alleged
passageway in the balcony; (4) pay ₱40,000.00 as reimbursement for completion work
done by respondent; (5) pay ₱27,321.75 per month for a period of twenty-one months for
the alleged unearned income during the period when the condominium unit remained
vacant. Petitioner, however, is ORDERED to pay ₱51,000 as temperate damages for the
termination of the lease contract because of the defects in the condominium unit. All other
awards are AFFIRMED.

No pronouncement as to costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
SECOND DIVISION
G.R. No. 154295. July 29, 2005
METROMEDIA TIMES CORPORATION and/or ROBINA GOKONGWIE-PE, Petitioners,
vs.
Johnny Pastorin, Respondent.
DECISION
TINGA, J.:
At issue in this Petition for Review1 on certiorari under Rule 45 is whether or not lack of jurisdiction
over the subject matter of the case, heard and decided by the labor arbiter, may be raised for the
first time before the National Labor Relations Commission (NLRC) by a litigant who had actively
participated in the proceedings, which it belatedly questioned.
The facts, culled from the records, are as follows:
Johnny Pastorin (Respondent) was employed by Metromedia Times Corporation (Petitioner) on 10
December 1990 as a Field Representative/Collector. His task entailed the periodic collection of
receivables from dealers of petitioner's newspapers. Prior to the subject incident, respondent
claimed to have received a termination letter dated 7 May 1998 from management terminating his
services for tardiness effective 16 June 1988. Respondent, member of Metro Media Times
Employees Union, was not dismissed due to the intervention of the labor union, the collective
bargaining agent in the company.
In May 1998, he obtained a loan from one of the dealers whom he dealt with, Gloria A. de Manuel
(De Manuel), amounting to Nine Thousand Pesos (₱9,000.00). After paying One Thousand One
Hundred Twenty-five Pesos (₱1,125.00), respondent reneged on the balance of his loan. De
Manuel wrote a letter dated 6 July 1998 to petitioner, and seeking assistance for collection on the
remainder of the loan. She claimed that when respondent became remissed on his personal
obligation, he stopped collecting periodically the outstanding dues of De Manuel 2
On 9 July 1998, petitioner sent a letter addressed to respondent, requiring an explanation for the
transaction with De Manuel, as well as for his failure to pay back the loan according to the
conditions agreed upon. In his reply letter3dated 13 July 1998, respondent admitted having
incurred the loan, but offered no definitive explanation for his failure to repay the same.
Petitioner, through a Memorandum4 dated 24 August 1998, imposed the penalty of suspension on
respondent for 4 days, from 27 August to 1 September 1998, for violating Company Policy No.
2.175 and ordered his transfer to the Administration Department.
On 2 September 1998, respondent wrote a letter6 to petitioner, stating that he wanted to sign a
transfer memo before assuming his new position.
On September 7, 1998, he was handed the Payroll Change Advice7 (PCA), indicating his new
assignment to the Traffic and Order Department of Metromedia. Nonetheless, respondent stopped
reporting for work. On 16 September 1998, he sent a letter8 to petitioner communicating his
refusal to accept the transfer.
Respondent duly filed a complaint for constructive dismissal, non-payment of backwages and
other money claims with the labor arbiter, a copy of which petitioner received on 28 September
1998. The complaint was resolved in favor of respondent. In a Decision9 dated 28 May 1999,
Labor Arbiter Manuel P. Asuncion concluded that respondent did not commit insubordination or
disobedience so as to warrant his transfer, and that petitioner was not aggrieved by respondent’s
failure to settle his obligation with De Manuel. The dispositive portion read:
WHEREFORE, the respondents are hereby ordered to reinstate the complainant to his former
position, with full backwages from the time his salary was withheld until he is actually reinstated.
As of this date, the complainant’s backwages has reached the sum of ₱97,324.17. The
respondents are further directed to pay the complainant his 13th month pay for 1998 in the sum of
₱3,611.89. The claims for allowance and unpaid commission are dismissed for lack of sufficient
basis to make an award.
SO ORDERED.10
Petitioner lodged an appeal with the NLRC, raising as a ground the lack of jurisdiction of the labor
arbiter over respondent’s complaint. Significally, this issue was not raised by petitioner in the
proceedings before the Labor Arbiter. In its Decision11 dated 16 March 2001, the NLRC reversed
the Labor Arbiter on the ground that thee latter had no jurisdiction over the case, it being a
grievance issue properly cognizable by the voluntary arbitrator. The decretal portion of the
NLRC Decision reads:
WHEREFORE, the decision under review is REVERSED and SET ASIDE, and a new one
entered, DISMISSING the complaint for lack of jurisdiction.
SO ORDERED.12
The motion for reconsideration having been denied on 18 May 2001, respondent elevated the
case before the Court of Appeals (CA) through a petition for certiorari13 under Rule 65.
The CA Fifteenth Division reversed the Decision of NLRC, and reinstated the earlier ruling of the
Labor Arbiter. Adopting the doctrines by this Court in the cases of Alfredo Marquez v. Sec. of
Labor14 and ABS-CBN Supervisors Employees Union Members v. ABS-CBN Broadcasting
Corporation,15 the CA ruled that the active participation of the party against whom the action was
brought, coupled with his failure to object to the jurisdiction of the court or quasi-judicial body
where the action is pending, is tantamount to an invocation of that jurisdiction and a willingness to
abide by the resolution of the case and will bar said party from later on impugning the court or
body’s jurisdiction. The appellate court then disposed the case in this wise:
WHEREFORE, foregoing premises considered, the petition having merit, in fact and in law,
is hereby GIVEN DUE COURSE. Accordingly, the challenged resolution/decision and orders of
public respondent NLRC are hereby REVERSED and SET ASIDE and the decision of the
Labor Arbiter dated May 28, 1999 REINSTATED with a slight modification, that the 13th
month pay be in the amount of ₱7,430.50. No costs.
SO ORDERED.16
Petitioner sought reconsideration17 of the above Decision18 but the CA denied the motion in the
assailed Resolution19 dated 27 June 2002. Hence, its recourse to this Court, elevating the
following issues:
I.
WHETHER OR NOT METROMEDIA IS ESTOPPED FROM QUESTIONING THE JURISDICTION
OF THE LABOR ARBITER OVER THE SUBJECT MATTER OF THE CASE FOR THE FIRST
TIME ONLY IN THEIR APPEAL BEFORE THE NLRC.
II.
WHETHER OR NOT THE AWARD OF 13TH MONTH PAY BY THE LABOR ARBITER MAY BE
MODIFIED, NOTWITHSTANDING THAT THE SAME WAS NEVER ASSIGNED AS AN ERROR.
Anent the first assignment of error, there are divergent jurisprudential doctrines touching on this
issue. On the one hand are the cases of Martinez v. Merced,20 Marquez v. Secretary of
Labor,21 Ducat v. Court of Appeals,22 Bayoca v. Nogales,23 Jimenez v. Patricia,24 Centeno v.
Centeno,25 and ABS-CBN Supervisors Employee Union Members v. ABS-CBN Broadcasting
Corporation,26 all adhering to the doctrine that a party’s active participation in the actual
proceedings before a court without jurisdiction will estop him from assailing such lack of
jurisdiction. Respondent heavily relies on this doctrinal jurisprudence.
On the other hand, the cases of Dy v. NLRC,27 La Naval Drug v. CA,28 De Rossi vs.
CA29 and Union Motors Corporation v. NLRC30 buttress the position of petitioner that jurisdiction is
conferred by law and lack of jurisdiction may be questioned at any time even on appeal.
The Court of Appeals adopted the principles in the cases of Martinez, Marquez and ABS-CBN in
resolving the jurisdictional issue presented for its resolution, to wit:
Indeed, we agree with petitioner that private respondent was estopped from raising the question of
jurisdiction before public respondent NLRC and the latter gravely abused its discretion in
addressing said question in private respondents’ favor. As early as Martinez vs. De la Merced, 174
SCRA 182, the Supreme Court has clearly ruled thus: "For it has been consistently held by this
Court that while lack of jurisdiction may be assailed at any stage, a party’s active participation in
the proceedings before a court without jurisdiction will estop such party from assailing such lack of
jurisdiction."
....
The same principle was adopted by the Highest Tribunal in the case of Alfredo Marquez vs. Sec.
of Labor, 171 SCRA 337 and quoted in the latter case of ABS-CBN Supervisors Employees Union
Members vs. ABS-CBN Broadcasting Corporation, 304 SCRA 497, where it was ruled that: "The
active participation of the party against whom the action was brought, coupled with his failure to
object to the jurisdiction of the court or quasi-judicial body where the action is pending, is
tantamount to an invocation of that jurisdiction and a willingness to abide by the resolution of the
case and will bar said party from later on impugning the court or body’s jurisdiction."31
We rule differently. A cursory glance at these cases will lead one to the conclusion that a party
who does not raise the jurisdictional question at the outset will be estopped to raise it on appeal.
However, a more circumspect analysis would reveal that the cases cited by respondent do not fall
squarely within the issue and factual circumstances of the instant case. We proceed to
demonstrate.
The notion that the defense of lack of jurisdiction may be waived by estoppel on the party invoking
the same most prominently emerged in Tijam v. Sibonghanoy.32 Indeed, the Marquez case relied
upon by the CA is in turn grounded on Tijam, where We held that:
. . . a party can not invoke the jurisdiction of a court to secure affirmative relief against his
opponent and, after obtaining or failing to obtain such relief, repudiate or question that same
jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79). In the case just cited, by way of explaining
the rule, it was further said that the question whether the court had jurisdiction either of the
subject-matter of the action or of the parties is barred from such conduct not because the
judgment or order of the court is valid and conclusive as an adjudication, but for the reason that
such a practice can not be tolerated—obviously for reasons of public policy.
Furthermore, it has also been held that after voluntarily submitting a cause and encountering an
adverse decision on the merits, it is too late for the loser to question the jurisdiction or power of the
court . . . And in Littleton vs. Burges, 16 Wyo, 58, the Court said that it is not right for a party who
has affirmed and invoked the jurisdiction of a court in a particular matter to secure an affirmative
relief, to afterwards deny that same jurisdiction to escape a penalty.33
However, Tijam represented an exceptional case wherein the party invoking lack of jurisdiction did
so only after fifteen (15) years, and at a stage when the proceedings had already been elevated to
the Court of Appeals. Even Marquez recognizes that Tijam stands as an exception, rather than a
general rule.34 The CA perhaps though felt comfortable citing Marquez owing to the
pronouncement therein that the Court would not hesitate to apply Tijameven absent the
extraordinary circumstances therein:
". . . where the entertainment of the jurisdictional issue at a belated stage of the proceedings will
result in a failure of justice and render nugatory the constitutional imperative of protection to
labor."35
In this case, jurisdiction of the labor arbiter was questioned as early as during appeal before the
NLRC, whereas in Marquez, the question of jurisdiction was raised for the first time only before
this Court. The viability of Marquez as controlling doctrine in this case is diminished owing to the
radically different circumstances in these two cases. A similar observation can be made as to
the Bayoca and Jimenez cases.36
Neither do the other like-minded cases squarely settle the issue in favor of the respondent. In the
case of Martinez, the issue is not jurisdiction by estoppel but waiver of preliminary conference. In
that case, we said:
As pointed out by petitioners, private respondents had at least three opportunities to raise the
question of lack of preliminary conference first, when private respondents filed a motion for
extension of time to file their position paper; second, at the time when they actually filed their
position paper in which they sought affirmative relief from the Metropolitan Trial Court; and third;
when they filed a motion for reconsideration of the order of the Metropolitan Trial Court expunging
from the records the position paper of private respondents, in which motion private respondents
even urged the court to sustain their position paper. And yet, in none of these instances was the
issue of lack of preliminary conference raised or even hinted at by private respondents. In fine,
these are acts amounting to a waiver of the irregularity of the proceedings. For it has been
consistently held by this Court that while lack of jurisdiction may be assailed at any stage, a party's
active participation in the proceedings before a court without jurisdiction will estop such party from
assailing such lack of jurisdiction.37
The case of Ducat was categorical in saying that if the parties acquiesced in submitting an issue
for determination by the trial court, they are estopped from questioning the jurisdiction of the same
court to pass upon the issue. But this should be taken in the context of the "agreement" of the
parties. We quote from said case:
Petitioner’s filing of a Manifestion and Urgent Motion to Set Parameters of Computation is
indicative of its conformity with the questioned order of the trial court referring the matter of
computation of the excess to SGV and simultaneously thereafter, the issuance of a writ of
possession. If petitioner thought that subject order was wrong, it could have taken recourse to the
Court of Appeals but petitioner did not. Instead he manifested his acquiescence in the said order
by seeking parameters before the trial court. It is now too late for petitioner to question subject
order of the trial court. Petitioner cannot be allowed to make a mockery of judicial processes, by
changing his position from one of the agreement to disagreement, to suit his needs. If the parties
acquiesced in submitting an issue for determination by the trial court, they are estopped from
questioning the jurisdiction of the same court to pass upon the issue. Petitioner is consequently
estopped from questioning subject order of the trial court.38
Centeno involved the question of jurisdiction of the Department of Agrarian Reform Arbitration
Board (DARAB). The Court did rule therein that "participation by certain parties in the
administrative proceedings without raising any objection thereto, bars them from any jurisdictional
infirmity after an adverse decision is rendered against them."39Still, the Court did recognize therein
that the movants questioning jurisdiction had actually sought and litigated for affirmative reliefs
before the DARAB in support of a submitted counterclaim. No similar circumstance obtains in this
case concerning the petitioner.
Evidently, none of these cited precedents squarely operates as stare decisis on this case,
involving as they did different circumstances. The question now lies as to whether the precedents
cited by petitioner are more apropos to this case.
Petitioner seeks to convince this Court that the instant case falls squarely within the purview of this
Court’s ruling in the case of Dy. Admittedly, a different factual mileu was present insofar as the
questioned jurisdiction was alleged to have been properly lodged in the SEC instead of NLRC. Yet
the rationale employed by the Court therein warrants serious consideration. The aforementioned
case was ruled in this wise:
. . . .More importantly, estoppel cannot be invoked to prevent this Court from taking up the
question of jurisdiction, which has been apparent on the face of the pleadings since the start of
litigation before the Labor Arbiter. It is well settled that the decision of a tribunal not vested with
appropriate jurisdiction is null and void. Thus, in Calimlim vs. Ramirez, this Court held:
"A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to
cite is that the jurisdiction of a court over the subject matter of the action is a matter of law and
may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court
may be raised at any stage of the proceedings, even on appeal. This doctrine has been qualified
by recent pronouncements which stemmed principally from the ruling in the cited case
of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to
situations which were obviously not contemplated therein. The exceptional circumstances involved
in Sibonghanoy which justified the departure from the accepted concept of non-waivability of
objection to jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly
upheld that rendered the supposed ruling in Sibonghanoy not as the exception, but rather the
general rule, virtually overthrowing altogether the time honored principle that the issue of
jurisdiction is not lost by waiver or by estoppel.
....
"It is neither fair nor legal to bind a party by the result of a suit or proceeding which was taken
cognizance of in a court which lacks jurisdiction over the same irrespective of the attendant
circumstances. The equitable defense of estoppel requires knowledge or consciousness of the
facts upon which it is based. The same thing is true with estoppel by conduct which may be
asserted only when it is shown, among others, that the representation must have been made with
knowledge of the facts and that the party to whom it was made is ignorant of the truth of the matter
(De Castro vs. Gineta, 27 SCRA 623). The filing of an action or suit in a court that does not
possess jurisdiction to entertain the same may not be presumed to be deliberate and intended to
secure a ruling which could later be annulled if not favorable to the party who filed such suit or
proceeding in a court that lacks jurisdiction to take cognizance of the same, such act may not at
once be deemed sufficient basis of estoppel. It could have been te result of an honest mistake or
of divergent interpretation of doubtful legal provisions. If any fault is to be imputed to a party taking
such course of action, part of the blame should be placed on the court which shall entertain the
suit, thereby lulling the parties into believing that they pursued their remedies in the correct forum.
Under the rules, it is the duty of the court to dismiss an action `whenever it appears that court has
no jurisdiction over the subject matter.' (Section 2, Rule 9, Rules of Court) Should the Court render
a judgment without jurisdiction, such judgment may be impeached or annulled for lack of
jurisdiction (Sec. 30, Rule 132, Ibid), within ten (10) years from the finality of the same (Art. 1144,
par. 3, Civil Code)."40
The jurisdiction of the Labor Arbiter was assailed in the cases of De Rossi v. NLRC 41 and Union
Motors Corporation v. NLRC42 during appeal to the NLRC. Since the same circumstance obtains
in this case, the rulings therein, favorable as they are to the petitioner, are germane.
In De Rossi, this Court elucidated:
Petitioner maintains that MICC can not question now the issue of jurisdiction of the NLRC,
considering that MICC did not raise this matter until after the case had been brought on appeal to
the NLRC. However, it has long been established as a rule, that jurisdiction of a tribunal, agency,
or office, is conferred by law, and its lack of jurisdiction may be questioned at any time even on
appeal. In La Naval Drug Corporation vs. Court of Appeals, 236 SCRA 78, 90, this Court said:
"Lack of jurisdiction over the subject matter of the suit is yet another matter. Whenever it appears
that the court has no jurisdiction over the subject matter, the action shall be dismissed. This
defense may be interposed at any time, during appeal or even after final judgment. Such is
understandable, as this kind of jurisdiction is conferred by law and not within the courts, let alone
the parties, to themselves determine or conveniently set aside."43
We held in the Union Motors Case:
The long-established rule is that jurisdiction over a subject matter is conferred by law. [Ilaw at
Buklod ng Manggaggawa v. NLRC, 219 SCRA 536 (1993); Atlas Developer & Steel Industries,
Inc. v. Sarmiento Enterprises, Inc., 184 SCRA 153 (1990); Tijam v. Sibonghanoy, 23 SCRA 29, 30
(1968)]. Estoppel does not apply to confer jurisdiction to a tribunal that has none over a cause of
action. Where it appears that the court or tribunal has no jurisdiction, then the defense may be
interposed at any time, even on appeal or even after final judgment. Moreover, the principle of
estoppel cannot be invoked to prevent this court from taking up the question of jurisdiction. 44
45
The rulings in Lozon v. NLRC addresses the issue at hand. This Court came up with a clear rule
as to when jurisdiction by estoppel applies and when it does not:
Lack of jurisdiction over the subject matter of the suit is yet another matter. Whenever it appears
that the court has no jurisdiction over the subject matter, the action shall be dismissed (Section 2,
Rule 9, Rules of Court). This defense may be interposed at any time, during appeal (Roxas vs.
Rafferty, 37 Phil. 957) or even after final judgment (Cruzcosa vs. Judge Concepcion, et al., 101
Phil. 146). Such is understandable, as this kind of jurisdiction is conferred by law and not within
the courts, let alone the parties, to themselves determine or conveniently set aside. In People vs.
Casiano (111 Phil. 73, 93-94), this Court, on the issue of estoppel, held:
"The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon
whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case
was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on
appeal, from assailing such jurisdiction, for the same 'must exist as a matter of law, and
may not be conferred by consent of the parties or by estoppel' (5 C.J.S., 861-863). However,
if the lower court had jurisdiction, and the case was heard and decided upon a given
theory, such, for instance, as that the court had no jurisdiction, the party who induced it to
adopt such theory will not be permitted, on appeal, to assume an inconsistent position—
that the lower court had jurisdiction. Here, the principle of estoppel applies. The rule that
jurisdiction is conferred by law, and does not depend upon the will of the parties, has no bearing
thereon.46 (Emphasis supplied)
Verily, Lozon, Union Motors, Dy and De Rossi aptly resolve the jurisdictional issue obtaining in this
case. Applying the guidelines in Lozon, the labor arbiter assumed jurisdiction when he should not.
In fact, the NLRC correctly reversed the labor arbiter’s decision and ratiocinated:
What appears at first blush to be an issue which pertains to the propriety of complainant’s
reassignment to another job on account of his having contracted a private loan, is one which may
be considered as falling within the jurisdiction of the Office of the Labor Arbiter. Nevertheless,
since the complainant is a union member, he should be bound by the covenants provided for in
the Collective Bargaining Agreement.47
....
Based on the foregoing considerations, it appears that the issue of validity of complainant’s
reassignment stemmed from the exercise of a management prerogative which is a matter apt for
resolution by a Grievance Committee, the parties having opted to consider such as a grievable
issue. Further, a review of the records would show that the matter of reassignment is one not
directly related to the charge of complainant’s having committed an act which is inimical to
respondents’ interest, since the latter had already been addressed to by complainant’s service of a
suspension order. The transfer, in effect, is one which properly falls under Section 1, Article IV of
the Collective Bargaining Agreement and, as such, questions as to the enforcement thereof is one
which falls under the jurisdiction of the labor arbiter."48
In line with the cases cited above and applying the general rule that estoppel does not confer
jurisdiction, petitioner is not estopped from assailing the jurisdiction of the labor arbiter before the
NLRC on appeal.
Respondent relied solely on estoppel to oppose petitioner’s claim of lack of jurisdiction on the part
of the labor arbiter. He adduced no other legal ground in support of his contention that the Labor
Arbiter had jurisdiction over the case. Thus, his claim falls flat in light of our pronouncement, and
more so considering the NLRC’s correct observation that jurisdiction over grievance issues, such
as the propriety of the reassignment of a union member falls under the jurisdiction of the voluntary
arbitrator.
Since jurisdiction does not lie with the Labor Arbiter, it is futile to discuss about the computation of
the 13th month pay.
WHEREFORE, the questioned decision of the Labor Arbiter and the Court of Appeals are hereby
REVERSED and SET ASIDE, and the decision of the NLRC in dismissing the complaint for lack of
jurisdiction REINSTATED.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 167702 March 20, 2009
LOURDES L. ERISTINGCOL, Petitioner,
vs.
COURT OF APPEALS and RANDOLPH C. LIMJOCO, Respondents.
DECISION
NACHURA, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court which assails the
Court of Appeals (CA) Decision1 in CA-G.R. SP. No. 64642 dismissing Civil Case No. 99-297
before the Regional Trial Court (RTC) for lack of jurisdiction.
The facts, as narrated by the CA, are simple.
[Petitioner Lourdes] Eristingcol is an owner of a residential lot in Urdaneta Village (or "village"),
Makati City and covered by Transfer Certificate of Title No. 208586. On the other hand,
[respondent Randolph] Limjoco, [Lorenzo] Tan and [June] Vilvestre were the former president and
chairman of the board of governors (or "board"), construction committee chairman and village
manager of [Urdaneta Village Association Inc.] UVAI, respectively. UVAI is an association of
homeowners at Urdaneta Village.
[Eristingcol’s] action [against UVAI, Limjoco, Tan and Vilvestre] is founded on the allegations that
in compliance with the National Building Code and after UVAI’s approval of her building plans and
acceptance of the construction bond and architect’s fee, Eristingcol started constructing a house
on her lot with "concrete canopy directly above the main door and highway"; that for alleged
violation of its Construction Rules and Regulations (or "CRR") on "Set Back Line" vis-a-vis the
canopy easement, UVAI imposed on her a penalty of ₱400,000.00 and barred her workers and
contractors from entering the village and working on her property; that the CRR, particularly on
"Set Back Line," is contrary to law; and that the penalty is unwarranted and excessive.
On February 9, 1999, or a day after the filing of the complaint, the parties reached a temporary
settlement whereby UVAI, Limjoco, Tan and Vilvestre executed an undertaking which allowed
Eristingcol’s workers, contractors and suppliers to leave and enter the village, subject only to
normal security regulations of UVAI.
On February 26, 1999, UVAI, Limjoco, Tan and Vilvestre filed a motion to dismiss on ground of
lack of jurisdiction over the subject matter of the action. They argued that it is the Home Insurance
Guaranty Corporation (or "HIGC")2which has jurisdiction over intra-corporate disputes involving
homeowners associations, pursuant to Exec. Order No. 535, Series of 1979, as amended by
Exec. Order No. 90, Series of 1986.
Opposing the motion, Eristingcol alleged, among others, that UVAI, Limjoco, Tan and Vilvestre did
not comply with the mandatory provisions of Secs. 4 and 6, Rule 15 of the 1997 Rules of Civil
Procedure and are estopped from questioning the jurisdiction of the [RTC] after they voluntarily
appeared therein "and embraced its authority by agreeing to sign an Undertaking."
On May 20, 1999, Eristingcol filed an amended complaint by (i) impleading Manuel Carmona (or
"Carmona") and Rene Cristobal (or "Cristobal"), UVAI’s newly-elected president and chairman of
the board and newly-designated construction committee chairman, respectively, as additional
defendants and (ii) increasing her claim for moral damages against each petitioner from
₱500,000.00 to ₱1,000,000.00.
On May 25, 1999, Eristingcol filed a motion for production and inspection of documents, which
UVAI, Limjoco, Tan, Vilvestre, Carmona and Cristobal opposed. The motion sought to compel
[UVAI and its officers] to produce the documents used by UVAI as basis for the imposition of the
₱400,000.00 penalty on Eristingcol as well as letters and documents showing that UVAI had
informed the other homeowners of their violations of the CRR.
On May 26, 1999, the [RTC] issued an order which pertinently reads:
IN VIEW OF THE FOREGOING, for lack of merit, the defendants’ Motion to Dismiss is Denied,
and plaintiff’s motion to declare defendants in default and for contempt are also Denied."
The [RTC] ratiocinated that [UVAI, Limjoco, Tan and Vilvestre] may not assail its jurisdiction "after
they voluntarily entered their appearance, sought reliefs therein, and embraced its authority by
agreeing to sign an undertaking to desist from prohibiting (Eristingcol’s) workers from entering the
village." In so ruling, it applied the doctrine enunciated in Tijam v. Sibonghanoy.
On June 7, 1999, Eristingcol filed a motion reiterating her earlier motion for production and
inspection of documents.
On June 8, 1999, [UVAI, Limjoco, Tan and Vilvestre] moved for partial reconsideration of the order
dated May 26, 1999. Eristingcol opposed the motion.
On March 24, 2001, the [RTC] issued an order granting Eristingcol’s motion for production and
inspection of documents, while on March 26, 2001, it issued an order denying [UVAI’s, Limjoco’s,
Tan’s and Vilvestre’s] motion for partial reconsideration.
On May 10, 2001, [UVAI, Limjoco, Tan and Vilvestre] elevated the dispute before [the CA] via [a]
petition for certiorari alleging that the [RTC] acted without jurisdiction in issuing the orders of May
26, 1999 and March 24 and 26, 2001.3
The CA issued the herein assailed Decision reversing the RTC Order4 and dismissing Eristingcol’s
complaint for lack of jurisdiction.
Hence, this appeal positing a sole issue for our resolution:
Whether it is the RTC or the Housing and Land Use Regulatory Board (HLURB) which has
jurisdiction over the subject matter of Eristingcol’s complaint.
Before anything else, we note that the instant petition impleads only Limjoco as private
respondent. The rest of the defendants sued by Eristingcol before the RTC, who then collectively
filed the petition for certiorari before the CA assailing the RTC’s Order, were, curiously, not
included as private respondents in this particular petition.
Eristingcol explains that only respondent Limjoco was retained in the instant petition as her
discussions with UVAI and the other defendants revealed their lack of participation in the work-
stoppage order which was supposedly single-handedly thought of and implemented by Limjoco.
The foregoing clarification notwithstanding, the rest of the defendants should have been
impleaded as respondents in this petition considering that the complaint before the RTC, where
the petition before the CA and the instant petition originated, has yet to be amended. Furthermore,
the present petition maintains that it was serious error for the CA to have ruled that the RTC did
not have jurisdiction over a complaint for declaration of nullity of UVAI’s Construction Rules.
Clearly, UVAI and the rest of the defendants should have been impleaded herein as respondents.
Section 4(a), Rule 45 of the Rules of Court, requires that the petition shall "state the full name of
the appealing party as petitioner and the adverse party as respondent, without impleading the
lower courts or judges thereof either as petitioners or respondents." As the losing party in
defendants’ petition for certiorari before the CA, Eristingcol should have impleaded all petitioners,
the winning and adverse parties therein.
On this score alone, the present petition could have been dismissed outright. 5 However, to settle
the issue of jurisdiction, we have opted to dispose of this case on the merits.
Despite her having dropped UVAI, Lorenzo Tan (Tan) and June Vilvestre (Vilvestre) from this suit,
Eristingcol insists that her complaint against UVAI and the defendants was properly filed before
the RTC as it prays for the declaration of nullity of UVAI’s Construction Rules and asks that
damages be paid by Limjoco and the other UVAI officers who had inflicted injury upon her.
Eristingcol asseverates that since the case before the RTC is one for declaration of nullity, the
nature of the question that is the subject of controversy, not just the status or relationship of the
parties, should determine which body has jurisdiction. In any event, Eristingcol submits that the
RTC’s jurisdiction over the case was foreclosed by the prayer of UVAI and its officers, including
Limjoco, for affirmative relief from that court.
Well-settled in jurisprudence is the rule that in determining which body has jurisdiction over a case,
we should consider not only the status or relationship of the parties, but also the nature of the
question that is the subject of their controversy.6 To determine the nature of an action and which
court has jurisdiction, courts must look at the averments of the complaint or petition and the
essence of the relief prayed for.7 Thus, we examine the pertinent allegations in Eristingcol’s
complaint, specifically her amended complaint, to wit:
Allegations Common to All Causes of Action
3. In 1958 and upon its incorporation, [UVAI] adopted a set of By-laws and Rules and Regulations,
x x x. Item 5 of [UVAI’s] Construction Rules pertinently provides:
"Set back line: All Buildings, including garage servants’ quarters, or parts thereof (covered
terraces, portes cocheres) must be constructed at a distance of not less than three (3) meters from
the boundary fronting a street and not less than four (4) meters fronting the drainage creek or
underground culvert and two (2) meters from other boundaries of a lot. Distance will be measured
from the vertical projection of the roof nearest the property line. Completely open and unroofed
terraces are not included in these restrictions."
Suffice it to state that there is nothing in the same By-laws which deals explicitly with canopies or
marquees which extend outward from the main building.
4. [Eristingcol] has been a resident of Urdaneta Village for eleven (11) years. In February 1997,
she purchased a parcel of land in the Village, located at the corner of Urdaneta Avenue and
Cerrada Street. x x x.
5. In considering the design for the house (the "Cerrada property") which she intended to construct
on Cerrada Street, [Eristingcol] referred to the National Building Code of the Philippines. After
assuring herself that the said law does not expressly provide any restrictions in respect thereof,
and after noting that other houses owned by prominent families had similar structures without
being cited by the Village’s Construction Committee, [Eristingcol] decided that the Cerrada
property would have a concrete canopy directly above the main door and driveway.
6. In compliance with [UVAI’s] rules, [Eristingcol] submitted to [UVAI] copies of her building plans
in respect of the Cerrada property and the building plans were duly approved by [UVAI]. x x x.
7. [Eristingcol] submitted and/or paid the "cash bond/construction bond deposit and architect’s
inspection fee" of ₱200,000.00 and the architect’s inspection fee of ₱500.00 as required under
Construction Rules x x x.
8. In the latter part of 1997, and while the construction of the Cerrada property was ongoing,
[Eristingcol] received a notice from [UVAI], charging her with alleged violations of the Construction
Rules, i.e., those on the height restriction of eleven (11.0) meters, and the canopy extension into
the easement. On 22nd January 1998, [Eristingcol] (through her representatives) met with, among
others, defendant Limjoco. In said meeting, and after deliberation on the definition of the phrase
"original ground elevation" as a reference point, [Eristingcol’s] representatives agreed to revise the
building plan by removing what was intended to be a parapet or roof railing, and thereby reduce
the height of the structure by 40 centimeters, which proposal was accepted by the Board through
defendant Limjoco, Gov. Catalino Macaraig Jr. ([UVAI’s] Construction Committee chairman), and
the Village’s Architect. However, the issue of the alleged violation in respect of the
canopy/extension remained unresolved.
xxxx
9. In compliance with the agreement reached at the 22nd January 1998 meeting, [Eristingcol]
caused the revision of her building plans such that, as it now stands, the Cerrada property has a
vertical height of 10.96 meters and, thus, was within the Village’s allowed maximum height of 11
meters.
10. Sometime in June 1998, [Eristingcol] was surprised to receive another letter from [UVAI], this
time from the Construction Committee chairman (defendant Tan), again calling her attention to
alleged violations of the Construction Rules. On 15th June 1998, [UVAI] barred [Eristingcol’s]
construction workers from entering the Village. Thus, [Eristingcol’s] Construction Manager (Mr.
Jaime M. Hidalgo) wrote defendant Tan to explain her position, and attached photographs of
similar "violations" by other property owners which have not merited the same scrutiny and
sanction from [UVAI].
xxxx
11. On 26th October 1998, and for reasons known only to him, defendant Vilvestre sent a letter to
Mr. Geronimo delos Reyes, demanding for an "idea of how [Mr. delos Reyes] can demonstrate in
concrete terms [his] good faith as a quid pro quo for compromise to" [UVAI’s] continued insistence
that [Eristingcol] had violated [UVAI’s] Construction Rules. x x x.
xxxx
12. [Eristingcol] through Mr. Hidalgo sent a letter dated 24th November 1998 to defendant Tan,
copies of which were furnished defendants Limjoco, Vilvestre and the Board, reiterating that,
among others: (i) the alleged height restriction violation is untrue, since the Cerrada property now
has a height within the limits imposed by [UVAI]; and (ii) the demand to reduce the canopy by
ninety (90) centimeters is without basis, in light of the existence of thirty-five (35) similar
"violations" of the same nature by other homeowners. [Eristingcol] through Mr. Hidalgo further
mentioned that she had done nothing to deserve the crude and coercive Village letters and the
Board’s threats of work stoppage, and she cited instances when she dealt with [UVAI] and her
fellow homeowners in good faith and goodwill such as in 1997, when she very discreetly spent
substantial amounts to landscape the entire Village Park, concrete the Park track oval which was
being used as a jogging path, and donate to the Association molave benches used as Park
benches.
xxxx
13. On the same date (24th November 1998), defendant Vilvestre sent another letter addressed to
[Eristingcol’s] construction manager Hidalgo, again threatening to enjoin all construction activity on
the Cerrada property as well as ban entry of all workers and construction deliveries effective 1st
December 1998 unless Mr. delos Reyes met with defendants. x x x.
xxxx
14. On 2nd December 1998, [Eristingcol’s] representatives met with defendants Limjoco, Tan, and
Vilvestre. During that meeting, defendants were shown copies of the architectural plans for the
Cerrada property. [Eristingcol’s] representatives agreed to allow [UVAI’s] Construction
Committee’s architect to validate the measurements given. However, on the issue of the canopy
extension, the defendants informed [Eristingcol’s] representatives that the Board would impose a
penalty of Four Hundred Thousand Pesos (₱400,000.00) for violation of [UVAI’s] "set back" or
easement rule. Defendants cited the Board’s imposition of similar fines to previous homeowners
who had violated the same rule, and they undertook to furnish [Eristingcol] with a list of past
penalties imposed and paid by homeowners found by the Board to have violated the Village’s "set
back" provision.
15. On 22nd December 1998, defendant Vilvestre sent [Eristingcol] a letter dated 18th December
1998 formally imposing a penalty of ₱400,000.00 for the "canopy easement violation." x x x.
16. On 29th December 1998, x x x, Vilvestre sent a letter to [Eristingcol], stating that "as far as
[his] administration is concerned, there has been no past penalties executed by [UVAI], similar to
the one we are presently demanding on your on going construction. x x x
17. On 4th January 1999, [Eristingcol’s] representative sent a letter to the Board, asking for a
reconsideration of the imposition of the ₱400,000.00 penalty on the ground that the same is
unwarranted and excessive. On 6th January 1999, [Eristingcol] herself sent a letter to the Board,
expounding on the reasons for opposing the Board’s action. On 18th January 1999, [Eristingcol]
sent another letter in compliance with defendants’ request for a breakdown of her expenditures in
respect of her donations relative to the Village park.
18. On 3rd February 1999, [Eristingcol] through her lawyers sent defendants a letter, requesting
that her letters of 4th and 6th January 1999 be acted upon.
19. On 4th February 1999, x x x, defendant Limjoco gave a verbal order to [UVAI’s] guards to bar
the entry of workers working on the Cerrada property.
20. In the morning of 5th February 1999, defendants physically barred [Eristingcol’s] workers and
contractors from entering the Village and working at the Cerrada property.8
Eristingcol then lists the following causes of action:
1. Item 5 of UVAI’s Construction Rules constitutes an illegal and unwarranted intrusion
upon Eristingcol’s proprietary rights as it imposes a set-back or horizontal easement of
3.0 meters from the property line greater than the specification in Section 1005(b) of the
Building Code that "the horizontal clearance between the outermost edge of the marquee
and the curb line shall be not less than 300 millimeters." As such, Eristingcol prays for the
declaration of nullity of this provision in UVAI’s Construction Rules insofar as she is
concerned.
2. UVAI’s imposition of a ₱400,000.00 penalty on Eristingcol has no factual basis, is
arbitrary, whimsical and capricious as rampant violations of the set-back rule by other
homeowners in the Village were not penalized by UVAI. Eristingcol prays to put a stop to
defendants’ arbitrary exercise of power pursuant to UVAI’s by-laws.
 3. Absent any factual or legal bases for the imposition of a ₱400,000.00 penalty,
defendants and all persons working under their control should be permanently barred or
restrained from imposing and/or enforcing any penalty upon Eristingcol for an alleged
violation of UVAI’s Construction Rules, specifically the provision on set-back.
4. Defendants Limjoco, Tan, and Vilvestre, in violation of Article 19 of the Civil Code,
demonstrated bias against Eristingcol by zeroing in on her alone and her supposed
violation, while other homeowners, who had likewise violated UVAI’s Construction Rules,
were not cited or penalized therefor. Defendants’ actuations were in clear violation of their
duty to give all homeowners, including Eristingcol, their due.
5. Defendants’ actuations have seriously affected Eristingcol’s mental disposition and
have caused her to suffer sleepless nights, mental anguish and serious anxiety.
Eristingcol’s reputation has likewise been besmirched by UVAI’s and defendants’ arbitrary
charge that she had violated UVAI’s Construction Rules. In this regard, individual
defendants should each pay Eristingcol moral damages in the amount of ₱1,000,000.00.
6. Lastly, defendants should pay Eristingcol ₱1,000.000.00 for litigation expenses she
incurred in instituting this suit and for attorney’s fees.
At the outset, we note that the relationship between the parties is not in dispute and is, in fact,
admitted by Eristingcol in her complaint. Nonetheless, Eristingcol is adamant that the subject
matter of her complaint is properly cognizable by the regular courts and need not be filed before a
specialized body or commission.
Eristingcol’s contention is wrong.
Ostensibly, Eristingcol’s complaint, designated as one for declaration of nullity, falls within the
regular courts’ jurisdiction. However, we have, on more than one occasion, held that the caption of
the complaint is not determinative of the nature of the action.9
A scrutiny of the allegations contained in Eristingcol’s complaint reveals that the nature of the
question subject of this controversy only superficially delves into the validity of UVAI’s
Construction Rules. The complaint actually goes into the proper interpretation and application of
UVAI’s by-laws, specifically its construction rules. Essentially, the conflict between the parties
arose as Eristingcol, admittedly a member of UVAI, now wishes to be exempt from the application
of the canopy requirement set forth in UVAI’s Construction Rules. Significantly, Eristingcol does
not assail the height restriction of UVAI’s Construction Rules, as she has readily complied
therewith.
Distinctly in point is China Banking Corp. v. Court of Appeals,10 which upheld the jurisdiction of the
Securities and Exchange Commission (SEC) over the suit and recognized its special competence
to interpret and apply Valley Golf and Country Club, Inc.’s (VGCCI’s) by-laws. We ruled, thus:
Applying the foregoing principles in the case at bar, to ascertain which tribunal has jurisdiction we
have to determine therefore whether or not petitioner is a stockholder of VGCCI and whether or
not the nature of the controversy between petitioner and private respondent corporation is intra-
corporate.
As to the first query, there is no question that the purchase of the subject share or membership
certificate at public auction by petitioner (and the issuance to it of the corresponding Certificate of
Sale) transferred ownership of the same to the latter and thus entitled petitioner to have the said
share registered in its name as a member of VGCCI. x x x.
By virtue of the aforementioned sale, petitioner became a bona fide stockholder of VGCCI and,
therefore, the conflict that arose between petitioner and VGCCI aptly exemplifies an intra-
corporate controversy between a corporation and its stockholder under Sec. 5(b) of P.D. 902-A.
An important consideration, moreover, is the nature of the controversy between petitioner and
private respondent corporation. VGCCI claims a prior right over the subject share anchored mainly
on Sec. 3, Art. VIII of its by-laws which provides that "after a member shall have been posted as
delinquent, the Board may order his/her/its share sold to satisfy the claims of the Club…" It is
pursuant to this provision that VGCCI also sold the subject share at public auction, of which it was
the highest bidder. VGCCI caps its argument by asserting that its corporate by-laws should
prevail. The bone of contention, thus, is the proper interpretation and application of VGCCI’s
aforequoted by-laws, a subject which irrefutably calls for the special competence of the SEC.
We reiterate herein the sound policy enunciated by the Court in Abejo v. De la Cruz:
6. In the fifties, the Court taking cognizance of the move to vest jurisdiction in administrative
commissions and boards the power to resolve specialized disputes in the field of labor (as in
corporations, public transportation and public utilities) ruled that Congress in requiring the
Industrial Court’s intervention in the resolution of labor-management controversies likely to cause
strikes or lockouts meant such jurisdiction to be exclusive, although it did not so expressly state in
the law. The Court held that under the "sense-making and expeditious doctrine of primary
jurisdiction … the courts cannot or will not determine a controversy involving a question which is
within the jurisdiction of an administrative tribunal, where the question demands the exercise of
sound administrative discretion requiring the special knowledge, experience, and services of the
administrative tribunal to determine technical and intricate matters of fact, and a uniformity of
ruling is essential to comply with the purposes of the regulatory statute administered.
xxxx
In this case, the need for the SEC’s technical expertise cannot be over-emphasized involving as it
does the meticulous analysis and correct interpretation of a corporation’s by-laws as well as the
applicable provisions of the Corporation Code in order to determine the validity of VGCCI’s claims.
The SEC, therefore, took proper cognizance of the instant case.11
Likewise in point is our illuminating ruling in Sta. Clara Homeowners’ Association v. Sps.
Gaston,12 although it ultimately held that the question of subject matter jurisdiction over the
complaint of respondent- spouses Gaston for declaration of nullity of a board resolution issued by
Sta. Clara Homeowners’ Association (SCHA) was vested in the regular courts. In Sta. Clara, the
main issue raised by SCHA reads: "Whether [the CA] erred in upholding the jurisdiction of the
[RTC], ‘to declare as null and void the resolution of the Board of SCHA, decreeing that only
members [in] good standing of the said association were to be issued stickers for use in their
vehicles.’" In holding that the regular courts had jurisdiction over respondent-spouses Gaston’s
complaint for declaration of nullity, we stressed the absence of relationship and the consequent
lack of privity of contract between the parties, thus:
Are [Respondent-Spouses Gaston] SCHA Members?
In order to determine if the HIGC has jurisdiction over the dispute, it is necessary to resolve
preliminarily—on the basis of the allegations in the Complaint—whether [respondent-spouses
Gaston] are members of the SCHA.
[SCHA] contend[s] that because the Complaint arose from intra-corporate relations between the
SCHA and its members, the HIGC therefore has jurisdiction over the dispute. To support their
contention that [respondent-spouses Gaston] are members of the association, [SCHA] cite[s] the
SCHA’s Articles of Incorporation and By-laws which provide that all landowners of the Sta. Clara
Subdivision are automatically members of the SCHA.
We are not persuaded. The constitutionally guaranteed freedom of association includes the
freedom not to associate. The right to choose with whom one will associate oneself is the very
foundation and essence of that partnership. It should be noted that the provision guarantees the
right to form an association. It does not include the right to compel others to form or join one.
More to the point, [respondent-spouses Gaston] cannot be compelled to become members of the
SCHA by the simple expedient of including them in its Articles of Incorporation and By-laws
without their express or implied consent. x x x. In the present case, however, other than the said
Articles of Incorporation and By-laws, there is no showing that [respondent-spouses Gaston] have
agreed to be SCHA members.
xxxx
No privity of Contract
Clearly then, no privity of contract exists between [SCHA] and [respondent-spouses Gaston]. As a
general rule, a contract is a meeting of minds between two persons. The Civil Code upholds the
spirit over the form; thus, it deems an agreement to exist, provided the essential requisites are
present. x x x. From the moment there is a meeting of minds between the parties, it is perfected.
As already adverted to, there are cases in which a party who enters into a contract of sale is also
bound by a lien annotated on the certificate of title. We recognized this in Bel Air Village
Association, Inc. v. Dionisio, in which we ruled:
There is no dispute that Transfer Certificate of Title No. 81136 covering the subject parcel of land
issued in the name of the petitioner contains an annotation to the effect that the lot owner
becomes an automatic member of the respondent Bel-Air Association and must abide by such
rules and regulations laid down by the Association in the interest of the sanitation, security and the
general welfare of the community. It is likewise not disputed that the provision on automatic
membership was expressly annotated on the petitioner’s Transfer Certificate of Title and on the
title of his predecessor-in-interest.
The question, therefore, boils down to whether or not the petitioner is bound by such annotation.
Section 39 of Art. 496 (The Land Registration Act) states:
Sec. 39. Every person receiving a certificate of title in pursuance of a decree of registration, and
every subsequent purchaser of registered land who takes a certificate of title for value in good
faith shall hold the same free of all encumbrances except those noted on said certificate x x x.
(Italics supplied)
The above ruling, however, does not apply to the case at bar. When [respondent-spouses Gaston]
purchased their property in 1974 and obtained Transfer Certificates of Title Nos. T-126542 and T-
127462 for Lots 11 and 12 of Block 37 along San Jose Avenue in Sta. Clara Subdivision, there
was no annotation showing their automatic membership in the SCHA. Thus, no privity of contract
arising from the title certificate exists between [SCHA] and [respondent-spouses Gaston].
Further, the records are bereft of any evidence that would indicate that private respondents
intended to become members of the SCHA. Prior to the implementation of the aforesaid
Resolution, they and the other homeowners who were not members of the association were
issued non-member gate pass stickers for their vehicles. This fact has not been disputed by
[SCHA]. Thus, the SCHA recognized that there were subdivision landowners who were not
members thereof, notwithstanding the provisions of its Articles of Incorporation and By-laws.
Jurisdiction Determined by Allegations in the Complaint
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the
complaint. Jurisdiction is not affected by the pleas or the theories set up by the defendant in an
answer or a motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely
upon the whims of the defendant.
The Complaint does not allege that [respondent-spouses Gaston] are members of the SCHA. In
point of fact, they deny such membership. Thus, the HIGC has no jurisdiction over the dispute.13
In stark contrast, the relationship between the parties in the instant case is well-established. Given
this admitted relationship, the privity of contract between UVAI and Eristingcol is palpable, despite
the latter’s deft phraseology of its primary cause of action as a declaration of nullity of UVAI’s
Construction Rules. In short, the crux of Eristingcol’s complaint is UVAI’s supposed arbitrary
implementation of its construction rules against Eristingcol, a member thereof.
Moreover, as in Sta. Clara (had respondent-spouses Gaston been members of SCHA), the
controversy which arose between the parties in this case partook of the nature of an intra-
corporate dispute. Executive Order (E.O.) No. 535,14 which amended Republic Act No. 580
creating the HIGC, transferred to the HIGC the regulatory and administrative functions over
homeowners’ associations originally vested with the SEC. Section 2 of E.O. No. 535 provides in In fine, based on the allegations contained in Eristingcol’s complaint, it is the HLURB, not the RTC,
pertinent part: which has jurisdiction over this case.

2. In addition to the powers and functions vested under the Home Financing Act, the Corporation, WHEREFORE, premises considered, the petition is DENIED. The Decision of the Court of
shall have among others, the following additional powers: Appeals in CA-G.R. SP. No. 64642 is hereby AFFIRMED. Costs against petitioner.

(a) x x x; and exercise all the powers, authorities and responsibilities that are vested on SO ORDERED.
the Securities and Exchange Commission with respect to home owners association, the
provision of Act 1459, as amended by P.D. 902-A, to the contrary notwithstanding;

(b) To regulate and supervise the activities and operations of all houseowners association
registered in accordance therewith.

By virtue thereof, the HIGC likewise assumed the SEC’s original and exclusive jurisdiction to hear
and decide cases involving controversies arising from intra-corporate or partnership
relations.15 Thereafter, with the advent of Republic Act No. 8763, the foregoing powers and
responsibilities vested in the HIGC, with respect to homeowners’ associations, were transferred to
the HLURB.

As regards the defendants’ supposed embrace of the RTC’s jurisdiction by appearing thereat and
undertaking to desist from prohibiting Eristingcol’s workers from entering the village, suffice it to
state that the invocation of the doctrine in Tijam, et al. v. Sibonghanoy, et al. 16 is quite a long
stretch.

The factual milieu obtaining in Tijam and in the case at bench are worlds apart. As found by the
CA, defendants’ appearance before the RTC was pursuant to, and in compliance with, a
subpoena issued by that court in connection with Eristingcol’s application for a Temporary
Restraining Order (TRO). On defendants’ supposed agreement to sign the Undertaking allowing
Eristingcol’s workers, contractors, and suppliers to enter and exit the village, this temporary
settlement cannot be equated with full acceptance of the RTC’s authority, as what actually
transpired in Tijam.1avvphi1.zw+

The landmark case of Tijam is, in fact, only an exception to the general rule that an objection to
the court’s jurisdiction over a case may be raised at any stage of the proceedings, as the lack of
jurisdiction affects the very authority of the court to take cognizance of a case. 17 In that case, the
Surety filed a Motion to Dismiss before the CA, raising the question of lack of jurisdiction for the
first time—fifteen years after the action was commenced in the Court of First Instance (CFI) of
Cebu. Indeed, in several stages of the proceedings in the CFI, as well as in the CA, the Surety
invoked the jurisdiction of said courts to obtain affirmative relief, and even submitted its case for a
final adjudication on the merits. Consequently, it was barred by laches from invoking the CFI’s lack
of jurisdiction.

To further highlight the distinction in this case, the TRO hearing was held on February 9, 1999, a
day after the filing of the complaint. On even date, the parties reached a temporary settlement
reflected in the Undertaking. Fifteen days thereafter, defendants, including Limjoco, filed a Motion
to Dismiss. Certainly, this successive and continuous chain of events cannot be characterized as
laches as would bar defendants from questioning the RTC’s jurisdiction.