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1. General Principles

1.1 Concept of Remedial Law

CIVIL PROCEDURE

PART I

Remedial Law is that branch of law which prescribes the methods of enforcing rights and obligations created by substantive law in case of invasion of these rights.

Nature of Remedial Law:

Since they (remedial law) are promulgated by authority of law, they have the force and effect of law if not in conflict with substantive law (Ateneo v. De La Rosa, G.R. No. L-286, March 28, 1946)

1.2 Substantive Law vis a vis Remedial Law

Substantive law is that part of the law which creates, defines and regulates rights, or which regulates the rights and duties which give rise to a cause of action; that part of the law which courts are established to administer; as opposed to adjective or remedial law, which prescribes the method of enforcing rights or obtains redress for their invasion. (Bustos v. Lucero, G.R. No. L-2086, March 8, 1949 Motion for Reconsideration Resolution)

Distinction between “Remedy” and Substantive right”:

The distinction between "remedy" and "substantive right" is incapable of exact definition. The difference is somewhat a question of degree. It is difficult to draw a line in any particular case beyond which legislative power over remedy and procedure can pass without touching upon the substantive rights of parties affected, as it is impossible to fix that boundary by general condition. This being so, it is inevitable that the Supreme Court in making rules should step on substantive rights, and the Constitution must be presumed to tolerate if not to expect such incursion as does not affect the accused in a harsh and arbitrary manner or deprive him of a defense, but operates only in a limited and unsubstantial manner to his disadvantage. For the Court's power is not merely to compile, revise or codify the rules of procedure existing at the time of the Constitution's approval. This power is "to promulgate rules concerning pleading, practice, and procedure in all courts," which is a power to adopt a general, complete and comprehensive system of procedure, adding new and different rules without regard to their source and discarding old ones. (Bustos v. Lucero, supra)

1.2.1 Meaning of Procedural Laws

According to De los Santos v. Vda. de Mangubat: “Procedural law refers to the adjective law which prescribes rules and forms of procedure in order that courts may be able to administer justice. Procedural laws do not come within the legal conception of a retroactive law, or the general rule against the retroactive operation of statues ― they may be given retroactive effect on actions pending and undetermined at the time of their passage and this will not violate any right of a person who may feel that he is adversely affected, insomuch as there are no vested rights in rules of procedure.” (Priscilla Alma Jose, Vs. Ramon C. Javellana, Et Al., G.R. No. 158239, January 25, 2012)

1.2.2

Procedural rules applicable to actions pending at the time of promulgation

Statutes and rules regulating the procedure of courts are considered applicable to actions pending and unresolved at the time of their passage. Procedural laws and rules are retroactive in that sense and to that extent. The effect of procedural statutes and rules on the rights of a litigant may not preclude their retroactive application to pending actions. This retroactive application does not violate any right of a person adversely affected. Neither is it constitutionally objectionable. The reason is that, as a general rule, no vested right may attach to or arise from procedural laws and rules. It has been held that "a person has no vested right in any particular remedy, and a litigant cannot insist on the application to the trial of his case, whether civil or criminal, of any other than the existing rules of procedure." More so when, as in this case, petitioner admits that it was not able to pay the docket fees on time. Clearly, there were no substantive rights to speak of when the RTC dismissed the Notice of Appeal. Panay Railways Inc., Vs. Heva Management And Development Corporation, Pamplona Agro-Industrial Corporation, And Spouses Candelaria Dayot And Edmundo Dayot, G. R. No. 154061, January 25,

2012)

1.2.3

Liberal construction or suspension of procedural rules

It should be emphasized that the resort to a liberal application, or suspension of the application of procedural rules, must remain as the exception to the well-settled principle that rules must be complied with for the orderly administration of justice. (Building Care Corporation/Leopard Security & Investigation Agency And/Or Ruperto Protacio, Vs. Myrna Macaraeg, G.R. No. 19835710 December 2012)

In Rural Bankers Association of the Philippines v. Tanghal-Salvaña, this Court held:

Obedience to the requirements of procedural rules is needed if the parties are to expect fair results therefrom, and utter disregard of the rules cannot justly be rationalized by harking on the policy of liberal construction. Procedural rules are tools designed to facilitate the adjudication of cases. Courts and litigants alike are thus enjoined to abide strictly by the rules. And while the Court, in some instances, allows a relaxation in the application of the rules, this was never intended to forge a bastion for erring litigants to violate the rules with impunity. The liberality in the interpretation and application of the rules applies only in proper cases and under justifiable causes and circumstances. While it is true that litigation is not a game of technicalities, it is equally true that every case must be prosecuted in accordance with the prescribed procedure to insure an orderly and speedy administration of justice. (Mca-Mbf Countdown Cards Philippines Inc., Amable R. Guiluz V, Amable C. Aguiluz Ix, Cielo C. Aguiluz, Alberto L. Buenviaje, Vicente Acsay And Mca Holdings And Management Corporation, Vs. Mbf Card International Limited And Mbf Discount Card Limited, G.R. No. 173586, March 14, 2012)

When liberal construction of the rules proper?

A liberal construction of the procedural rules is proper where the lapse in the literal observance of a rule of procedure has not prejudiced the adverse party and has not deprived the court of its authority. Indeed, Section 6, Rule 1 of the Rules of Court provides that the Rules should be liberally construed in order to promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding. Rules of procedure are tools designed to facilitate the attainment of justice, and courts must avoid their strict and rigid application which would result in technicalities that tend to frustrate rather than promote substantial justice. (Douglas F. Anama Vs. Philippine Savings Bank, G.R. No. 187021, January 25, 2012)

The liberal construction of the rules may be invoked in situations where there may be some excusable formal deficiency or error in a pleading, provided that the same does not subvert the essence of the proceeding and it at least connotes a reasonable attempt at compliance with the rules. Besides, fundamental is the precept that rules of procedure are meant not to thwart but to facilitate the attainment of justice; hence, their rigid application may, for deserving reasons, be subordinated by the need for an apt dispensation of substantial justice in the normal course. They ought to be relaxed when there is subsequent or even substantial compliance, consistent with the policy of liberality espoused by Rule 1, Section 6. Not being inflexible, the rule on verification allows for such liberality. (Felix Martos, Jimmy Eclana, Rodel Pilones, et al. Vs. New San Jose Builders, Inc., G.R. No. 192650. October 24, 2012)

1.2.3.1 When liberal construction is not applicable?

The Court is aware of the exceptional cases where technicalities were liberally construed. However, in these cases, outright dismissal is rendered unjust by the presence of a satisfactory and persuasive explanation. The parties therein who prayed for liberal interpretation were able to hurdle that heavy burden of proving that they deserve an exceptional treatment. It was never the Court’s intent "to forge a bastion for erring litigants to violate the rules with impunity."

This Court will not condone a cavalier attitude towards procedural rules. It is the duty of every member of the bar to comply with these rules. They are not at liberty to seek exceptions should they fail to observe these rules and rationalize their omission by harking on liberal construction. (Maria Consolacion Rivera-Pascual, Vs. Spouses Marilyn Lim And George Lim And The Registry Of Deeds Of Valenzuela City, G.R. No. 191837, September 19, 2012)

1.3 Rule-Making Power of Supreme Court

The Supreme Court shall have the following power… Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and procedure in all courts, the admission to the practice of law, the integrated bar, and legal assistance to the under-privileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of procedure of special courts and quasi- judicial bodies shall remain effective unless disapproved by the Supreme Court. (Article VIII, Section 5(5), 1987 Phil. Constitution)

1.3.1 Limitations of Rule-Making Power of the Supreme Court

1. The rules provide a simplified and inexpensive procedure for the speedy disposition of

cases;

2. The rules shall be uniform (not different or varying) for all courts of the same grade;

3. The rules shall not diminish, increase, or modify substantive rights. (Article VIII, Section 5(5), 1987 Phil. Constitution)

1.3.2 Power of the Supreme Court to amend and suspend procedural rules

The courts have the power to relax or suspend technical or procedural rules or to except a case from their operation when compelling reasons so warrant or when the purpose of justice requires it. What constitutes good and sufficient cause that would merit suspension of the rules

is discretionary upon the court (Commissioner of Internal Revenue v. Migrant Pagbilao Corporation, G.R. No. 159593. October 12, 2006).

In fact, this Court has held that even if there was complete non-compliance with the rule on certification against forum shopping, the Court may still proceed to decide the case on the merits, pursuant to its inherent power to suspend its own rules on grounds, as stated above, of substantial justice and apparent merit of the case. (SM Land, Inc. (Formerly Shoemart, Inc.) and Watsons Personal Care Store, Phils., Inc. Vs. City of Manila, Liberty Toledo, in her official capacity as the City Treasurer of Manila, et al. G.R. No. 197151. October 22, 2012)

1.3.3. Power of the Supreme Court to promulgate rules carries with it the power to overturn

judicial precedents:

a) The constitutional power of the Supreme Court to promulgate rules of practice and procedure to amend or repeal the same necessarily carries with it the power to overturn judicial precedents on points of remedial law through the amendment of the Rules of Court.(Pinga v. Heirs of Santiago, G.R No. 170354, June 30, 2006).

1.3.4. Power of the Supreme Court to promulgate rules are means for the court to exercise

jurisdiction:

The Rules of Court does not define jurisdictional boundaries of the courts. In promulgating the Rules of Court, the Supreme Court is circumscribed by the zone properly denominated as the promulgation of rules concerning pleading, practice, and procedure in all courts; consequently, the Rules of Court can only determine the means, ways or manner in which said jurisdiction, as fixed by the Constitution and acts of Congress, shall be exercised. (Minerva A. Gomez-Castillo vs. COMELEC, G.R. No. 187231, June 22, 2011)

1.3.5. Rule on the Writ of Amparo an exercise of Rule-making Power

The writ of amparo was promulgated by the Court pursuant to its rulemaking powers in response to the alarming rise in the number of cases of enforced disappearances and extrajudicial killings. (In the Matter of the Petition for the Issuance of a Writ of Amparo in Favor of Lilibeth Ladaga Vs. Major General Reynaldo Mapagu, Commanding General of the Philippine Army's 10th Infantry Division, et al./In the Matter of the Petition for the Issuance of a Writ of Amparo in Favor of Angela A. Librado-Trinidad Vs. Major General Reynaldo Mapagu, Commanding General of the Philippine Army's 10th Infantry Division, et al.In the Matter fo the Petition for the Issuance of a Writ of Amparo in Favor of Carlos Isagani T. Zarate Vs. Major General Reynaldo Mapagu, Commanding General of the Philippine Army's 10th Infantry Division, et al., G.R. No. 189689/G.R. No. 189690/G.R. No. 189691. November 13, 2012)

1.3.6 Power of the Supreme Court to amend and suspend procedural rules

The courts have the power to relax or suspend technical or procedural rules or to except a case from their operation when compelling reasons so warrant or when the purpose of justice requires it. What constitutes good and sufficient cause that would merit suspension of the rules is discretionary upon the court (Commissioner of Internal Revenue v. Migrant Pagbilao Corporation, G.R. No. 159593. October 12, 2006).

In the interest of just and expeditious proceedings, the Supreme Court may suspend the

application of the Rules of Court and except a case from its operation because the Rules were precisely adopted with the primary objective of enhancing fair trial and expeditious justice (Republic v. CA, et al., L-31303-04, May 31, 1978).

1.4 Nature of Philippine Courts

1.4.1 What is a Court?

An organ of government belonging to the judicial department the function of which is the application of the laws to controversies brought before it as well as the public administration of justice (Black’s, 5 th Edition, 356).

A court is called upon and authorized to administer justice. Sometimes it refers to the

place where justice is administered (20 Am Jur 2d, Courts, § 1, 1965; 21 C.J.S., Courts, § 1).

It is a board or tribunal which decides a litigation or contest (Hidalgo v. Manglapus, 64 O.G. 3189)

1.4.2. Court distinguished as from Judge

1. A court is a tribunal officially assembled under authority of law; a judge is simply an

officer of such tribunal (Wagen Horst v. Philadelphia Insurance Company 358pa. 55, 55 82d

762).

2. A court is an organ of the government with a personality separate and distinct from

the person or judge who sits on it.

3.

A court is an office while a judge is a public officer.

4.

.The circumstances of the court are not affected by the circumstance that would

affect the judge. The continuity of a court and the efficacy of its proceeding are not affected by

the death, resignation, or cessation from the service of the judge presiding over it. In other words the judge may resign, become incapacitated, or be disqualified to hold office but the court remains.

The death of the judge does not mean the death of the court (Riano, Civil Procedure; restatement for the bar 2009, p.45).

1.4.3 Classification of Philippine Courts

Constitutional Court - Those which owe their creation and existence to the Constitution. Its existence as well as the deprivation of its jurisdiction and powers cannot be made a subject of legislation. Example: The Supreme Court (Article VIII, Section 1(1), 1987 Phil. Constitution)

Note: Supreme Court is the only Constitutional Court in the Philippines. All others are Statutory Courts.

Statutory Courts A court created by law whose jurisdiction is exclusively determined by legislation. It may be abolished by Congress by simply repealing the law which created them. Example: Court of Appeals, Regional Trial Courts, Metropolitan/Municipal Courts (created by BP

129), The Court of Tax Appeals (created by RA 1125) Family Courts, Shari’ah District Courts, Shari’ah Cicuit Courts (P.D. 1083)

1.4.4. Nature of Philippine Courts: Law and Equity

a. Court of law decides a case according to the promulgated law

b. Court of Equity decides a case according to the common precepts of what is right and just without inquiring into the terms of the statutes.

Philippines courts, either original or appellate, exercise both the legal and equitable jurisdictions (U.S. v. Tamparong, G.R. No. 9527, August 23, 1915).

1.4.5. What is jurisdiction?

Refers to the power and authority of the court to hear, determine controversies, and decide a case (People v. Mariano, G.R. L-40527, June 30, 1976)

1. Kinds of jurisdiction:

a) Original and Appellate Jurisdiction

a) Original Jurisdiction power of the court to take cognizance of a case at its inception

or commencement.

b) Appellate Jurisdiction power vested in a superior court to review and revise the

judicial action of a lower court.

b) General and Special Jurisdiction

a) General Jurisdiction authority of the court to hear and determine all actions and

suits.

Example: Regional Trial Court is a court of general jurisdiction:

b) Special or Limited Jurisdiction authority of the court to hear and determine particular cases only.

Example: MTC/MCTC can entertain petition for habeas corpus if there is no available RTC judge:

1.4.6. Principle of Judicial Hierarchy:

Hierarchy of courts meant that while the Supreme Court, the Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue original writs of certiorari, prohibition, mandamus, quo warranto and habeas corpus, such concurrence does not accord litigants unrestrained freedom of choice of court to which filing thereof may be directed. Petitions should be filed with the court of lower level unless the importance of the issue involved deserves the action of a higher court. (Audi AG v. Mejia, G.R. No. 167533, July 27, 2007; De los Reyes v. People, G.R. No. 138297, January 27, 2006)

General rule: A higher court will not entertain a direct resort to it UNLESS the redress cannot be

obtained in the appropriate lower court.

Exception: In cases of national interest and of serious implications, Supreme Court does not hesitate to set aside the rule and proceed with the determination of the case (COMELEC v. Quijano-Padilla, G.R. No. 151992, September 18, 2002).

Purposes of Doctrine of Hierarchy of Courts; Exception

This Court’s original jurisdiction to issue writs of certiorari is not exclusive. It is shared by this Court with Regional Trial Courts and with the Court of Appeals. This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Court’s original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. (United Claimants Association of NEA (Unican) Vs. National Electrification Administration (NEA), G.R. No. 187107, January 31, 2012)

Doctrine of Transcendental Importance

Evidently, the instant petition should have been filed with the RTC. However, as an exception to this general rule, the principle of hierarchy of courts may be set aside for special and important reasons. Such reason exists in the instant case involving as it does the employment of the entire plantilla of NEA, more than 700 employees all told, who were effectively dismissed from employment in one swift stroke. This to the mind of the Court entails its attention. (United Claimants Association of NEA (Unican) Vs. National Electrification Administration (NEA), G.R. No. 187107, January 31, 2012)

The rule on hierarchy of courts does not prevent the Supreme Court from assuming jurisdiction where exceptional and compelling circumstances justify the resort to such remedy, in which case, the Supreme Court exercises its primary jurisdiction (Agan vs. Philippine International Air Terminal Co.,[PIATCO], G.R. No. 155001, May 5, 2003).

Doctrine of Non-interference or Judicial Stability

Courts of equal and coordinate jurisdiction cannot interfere or review with the orders of each other. A court is barred from reviewing judgments of a co-equal court over which it has no appellate jurisdiction nor power of review.

Doctrine of Non-interference applicable in administrative bodies:

The doctrine applies with equal force to administrative bodies. When the law provides for an appeal from the decision of an administrative body to the SC or CA, it means that such body is co-equal with the RTC in terms of rank and stature, and logically beyond the control of the latter (Civil Procedure [A Restatement For The Bar], Riano, 2007 ed. Citing Sinter Corporation and Phividec Industrial Authority v. Cagayan Electric Power and Light Co., Inc., G.R. No. 127371, 25 April 2002).

Doctrine of Primary Jurisdiction

The court cannot or will not determine a controversy involving a question which is within the jurisdiction of an administrative tribunal prior to resolving the same, where the question demands the exercise of sound administrative discretion requiring special knowledge, experience and services in determining technical or intricate matters of fact. (Omictin vs. Court of Appeals, G.R. No. 148004, January 22, 2007)

Exceptions:

(a) where there is estoppel on the part of the party invoking the doctrine;

(b) where the challenged administrative act is patently illegal, amounting to lack of

jurisdiction;

(c) where there is unreasonable delay or official inaction that will irretrievably prejudice

the complainant;

(d) where the amount involved is relatively small so as to make the rule impractical and

oppressive;

(e) where the question involved is purely legal and will ultimately have to be decided by

the courts of justice;

(f) where judicial intervention is urgent;

 

(g)

when its application may cause great and irreparable damage;

(h)

where the controverted acts violate due process;

(i)

when the issue of non-exhaustion of administrative remedies has been rendered

moot;

 

(j)

when there is no other plain, speedy and adequate remedy;

(k)

when strong public interest is involved; and,

(l)

in quo warranto proceedings.

(Republic v. Lacap, G.R. No. 158253, March 2, 2007, 517 SCRA 255)

Doctrine of Adherence of Jurisdiction/Continuing Jurisdiction

Jurisdiction, once it attaches, cannot be ousted by the happening of subsequent events even of such character which should have prevented jurisdiction from attaching in the first instance. “The rule of adherence of jurisdiction (exists) until a cause is finally resolved or adjudicated”. (Abad, et. al. v. RTC of Manila, et. al. G.R. No. L-65505, October 12, 1987)

Exceptions:

When the change in jurisdiction is curative in character (Abad et. al. v. RTC of Manila et. al., supra)

2.How jurisdiction is acquired?

2.1 Over the Plaintiff

The general rule in this jurisdiction is that a court acquires jurisdiction over the person of the plaintiff by the filing of his complaint. (Dilweg v. Phillips, G.R. L-19596, October 30, 1964, citing Manila Railroad Co. vs. Attorney General, 20 Phil. 523)

2.1.2. Over the defendant:

In civil cases, jurisdiction over the person of the defendant may be acquired either by service of summons or by the defendant’s voluntary appearance in court and submission to its

authority. (Optima Realty Corporation Vs. Hertz Phil., Exclusive, Inc. G.R. No. 183035. January 9,

Jurisdiction over the defendant is acquired either upon a valid service of summons or the defendant’s voluntary appearance in court. (Afdal & Afdal v. Carlos, G.R. No. 173379, December 1, 2010)

Jurisdiction over the person of the defendant is required only in an action in personam. Jurisdiction over the person of the defendant is NOT a prerequisite in an action in rem and quasi in rem (Gomez v. CA, 425 SCRA 98).

2.2 Over Subject Matter:

Meaning of Jurisdiction over Subject Matter

Jurisdiction over the subject-matter is the power to hear and determine cases of the general class to which the proceedings in question belong (C. J. S., p. 36) and is conferred by the sovereign authority which organizes the court and defines its powers (Banco Español Filipino vs. Palanca, 37 Phil. 921; Perkins vs. Dizon, 40 Off. Gaz. No. 7, 3d Sup. p. 216; Ng Si Chok vs. Vera, G.R. No. 45674). (Reyes v. Diaz, G.R. No. L-48754, November 26, 1941). In other terms, it is provided by law.

How is jurisdiction over the subject matter acquired?

Jurisdiction over the subject matter is the power to hear and determine the general class to which the proceedings in question belong. Jurisdiction over the subject matter is conferred by law and not by the consent or acquiescence of any or all of the parties or by erroneous belief of the court that it exists. Basic is the rule that jurisdiction over the subject matter is determined by the cause or causes of action as alleged in the complaint. (G.R. No. 178193, Danilo S. Ursua Vs. Republic of the Philippines)

How Jurisdiction is conferred and determined

It is an elementary rule of procedural law that jurisdiction over the subject matter of the case is conferred by law and is determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to recover upon all or some of the claims asserted therein. As a necessary consequence, the jurisdiction of the court cannot be made to depend upon the defenses set up in the answer or upon the motion to dismiss, for otherwise, the question of jurisdiction would almost entirely depend upon the defendant. What determines the jurisdiction of the court is the nature of the action pleaded as appearing from the allegations in the complaint. The averments in the complaint and the character of the relief sought are the matters to be consulted. (Fe V. Rapsing, Tita C. Villanueva and Annie F. Aparejado, represented by Edgar Aparejado Vs. Hon. Judge Maximino R. Ables, of RTC-Branch 47, Masbate City; SSGT. Edison Rural, et al. G.R. No. 171855. October 15, 2012)

It is a basic rule that jurisdiction over the subject matter is determined by the allegations in the complaint. It is determined exclusively by the Constitution and the law. It cannot be conferred by the voluntary act or agreement of the parties, or acquired through or waived, enlarged or diminished by their act or omission, nor conferred by the acquiescence of the court. Well to emphasize, it is neither for the court nor the parties to violate or disregard the rule, this matter being legislative in character. (Mendoza v. Germino & Germino, G.R. No.

165676, November 22, 2010)

Lack of jurisdiction over the subject matter a ground for annulment of judgment.

As this Court previously clarified in Republic of the Philippines v. "G" Holdings, Inc., "lack of jurisdiction" as a ground for the annulment of judgments pertains to lack of jurisdiction over the person of the defending party or over the subject matter of the claim. It does not contemplate "grave abuse of discretion" considering that "jurisdiction" is different from the exercise thereof. As ruled in Tolentino v. Judge Leviste: Jurisdiction is not the same as the exercise of jurisdiction. As distinguished from the exercise of jurisdiction, jurisdiction is the authority to decide a cause, and not the decision rendered therein. Where there is jurisdiction over the person and the subject matter, the decision on all other questions arising in the case is but an exercise of the jurisdiction. And the errors which the court may commit in the exercise of jurisdiction are merely errors of judgment which are the proper subject of an appeal. (Remedios Antonino, Vs. The Register Of Deeds Of Makati City And Tan Tian Su, G.R. No. 185663, June 20, 2012)

When to raise objections to jurisdiction over subject matter?

As a rule, an objection over subject-matter jurisdiction may be raised at any time of the proceedings. This is because jurisdiction cannot be waived by the parties or vested by the agreement of the parties. Jurisdiction is vested by law, which prevails at the time of the filing of the complaint. (Lasmis v. Dong-E, G.R. No. 173021, October 20, 2010)

Effects of Estoppel on objections to jurisdiction

The defense of lack of jurisdiction cannot be waived and may be raised at any stage of the proceeding even on appeal since it is conferred by law (De Leon vs. Court of Appeals, 245 SCRA 166, 1995).

A party may be barred from raising the defense of lack of jurisdiction or jurisdiction may be waived on the ground of estoppel by laches. 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 (Tijam v. Sibonghanoy, G.R. No. L-21450, April 15, 1968).

Lack of jurisdiction over subject matter vs. lack of jurisdiction over person of the petitioner

Lack of jurisdiction on the part of the trial court in rendering the judgment or final order is either lack of jurisdiction over the subject matter or nature of the action, or lack of jurisdiction over the person of the petitioner. The former is a matter of substantive law because statutory law defines the jurisdiction of the courts over the subject matter or nature of the action. The latter is a matter of procedural law, for it involves the service of summons or other process on the petitioner. A judgment or final order issued by the trial court without jurisdiction over the subject matter or nature of the action is always void, and, in the words of Justice Street in Banco Español-Filipino v. Palanca (37 Phil 949 [1918]), “in this sense it may be said to be a lawless thing, which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its head.” But the defect of lack of jurisdiction over the person, being a matter of procedural law, may be waived by the party concerned either expressly or impliedly. (Pinausukan Seafood House-Roxas Blvd., Inc. v. Far East Bank and Trust Cp., now Bank of the Philippine Islands, et al., G.R. No. 159926, January 20, 2014.)

2.3

Over the Issues

This is determined and conferred by the pleadings filed in the case by the parties, or by their agreement in a pre-trial order or stipulation, or, at times by their implied consent as by the failure of a party to object to evidence on an issue not covered by the pleadings, as provided in Sec. 5, Rule 10. (De Joya v. Marquez, et. al., G.R. No. 163416, January 31, 2006) Note: An issue is a single, certain, and material point arising out of the allegations and contentions of the parties; it is a matter affirmed on one side and denied on the other, and when a fact is alleged in the complaint and denied in the answer, the matters is then put in issue between the parties (Black’s, 9 th Ed. Citing 35A C.J.S. Federal Civil Procedure Sec. 357, at 541).

2.4 Over the Res or Property Involved in Litigation

This is acquired by the actual or constructive seizure by the court of the thing in question, thus placing it in custodia legis, as in attachment or garnishment; or by provision of law which recognizes in the court the power to deal with the property or subject matter within its territorial jurisdiction, as in land registration proceedings or suits involving civil status or real property in the Philippines of a non-resident defendant. (De Joya v. Marquez, et. al., supra)

2.5. Error of Jurisdiction as distinguished from Error of Judgment

Any error committed in the evaluation of evidence is merely an error of judgment that cannot be remedied by certiorari. An error of judgment is one which the court may commit in the exercise of its jurisdiction. An error of jurisdiction is one where the act complained of was issued by the court without or in excess of jurisdiction, or with grave abuse of discretion, which is tantamount to lack or in excess of jurisdiction and which error is correctible only by the extraordinary writ of certiorari. Certiorari will not be issued to cure errors of the trial court in its appreciation of the evidence of the parties, or its conclusions anchored on the said findings and its conclusions of law. (First Corporation v. Former Sixth Division of Court of Appeals et. al., G.R. No. 171989, July 4, 2007)

2.6 Jurisdiction versus the Exercise of Jurisdiction

Jurisdiction should be distinguished from the exercise of jurisdiction. The authority to decide a case at all and not the decision rendered therein is what makes up jurisdiction. Where there is jurisdiction of the person and the subject matter, the decision of all other question arising in the case is but an exercise of that jurisdiction. (Napa v. Weissenhagen, G.R. No. L- 9698, January 6, 1915)

2.7. Jurisdiction of different Courts:

JURISDICTION OF COURTS IN CIVIL CASES

2.5.1 Supreme Court (SC)

ORIGINAL

Petitions for certiorari, prohibition or mandamus against CA, COMELEC, COA, CTA and Sandiganbayan.

1.

Exclusive

 

2.

Concurrent

1. Petitions for certiorari, prohibition or mandamus against RTC, Civil Service Commission, Central Board of Assessment Appeals,

Other quasi-judicial agencies and NLRC

a. with the CA

 

2. Petition for Writ of Kalikasan and continuing mandamus pursuant to the Rules of Procedure for Environmental Cases (A.M. No. 09-6-8-SC, effective 29 April 2010)

 

b. with the CA,

1. Petitions for certiorari, prohibition or mandamus against courts of the first level and other bodies; and

SANDIGANBAYAN and

2. Petitions for Habeas Corpus and Quo Warranto

RTC

3. Petition for continuing mandamus pursuant to the Rules of Procedure for Environmental Cases (A.M. No. 09-6-8-SC, effective 29 April 2010)

 

c. with RTC

Actions affecting ambassadors, other public ministers and consuls

 

1. Petition for Writ of Amparo; and

 

d. with CA, RTC and

2. Petition for a Writ of Habeas Data

Sandiganbayan

APPELLATE

Petitions for Review on Certiorari against the CA, Sandiganbayan, CTA en banc, Final judgment or order in a Writ of Amparo or Habeas Data case and RTC in cases involving:

a. Constitutionality or validity of a treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction, ordinance or regulation

b. Legality of a tax, impost, assessment, toll or a penalty in relation thereto

c. Jurisdiction of a lower court, and

d. Pure error or question of law.

2.5.2 Court of Appeals (CA)

ORIGINAL

1.

Exclusive

Actions for annulment of judgments of RTC

2.

Concurrent

1. Petitions for certiorari, prohibition or mandamus against RTC, Civil Service Commission, Central Board of Assessment Appeals, Other quasi-judicial agencies & NLRC

a.

with the SC

 

2. Petition for Writ of Kalikasan and continuing mandamus pursuant to the Rules of Procedure for Environmental Cases (A.M. No. 09-6-8-SC, effective 29 April 2010)

 

1. Petitions for certiorari, prohibition or mandamus against courts of the first level and other bodies; and

2. Petitions for Habeas Corpus and Quo Warranto

 

b.

with SC, Sandiganbayan and

3. Petition for continuing mandamus pursuant to the Rules of Procedure for Environmental Cases (A.M. No. 09-6-8-SC, effective 29 April 2010)

RTC

 

c.

with SC,

1. Petition for Writ of Amparo (Sec. 3, Rule on the Writ of Amparo); and

2. Petition for a Writ of Habeas Data (Sec. 3, Rule on the Writ of Habeas Data)

Sandiganbayan and RTC

 

APPELLATE

1. Ordinary Appeals from RTC, except in cases exclusively appealable to the SC, Family Courts and Special Commercial Courts

 

2. Appeal by Petition for Review from Civil Service Commission, SEC, Land Registration Authority, Social Security Commission, Office of the President and any other quasi-judicial agency, instrumentality, board or commission in the exercise of its quasi- judicial functions

3. Petitions for Review from RTC in cases appealed thereto from the lower courts

2.5.3 Court of Tax Appeals (CTA)

ORIGINAL

1. Over all criminal cases arising from violation of NIRC of the TCC and other laws, part of laws, or special laws administered by the BIR or the BOC where the principal amount of taxes and

fees, exclusive of charges and penalties claimed is less than P1M or where there is no specified amount claimed;

2. In tax collection cases involving final and executor assessments of taxes, fees, charges and penalties where the principal amount of taxes and fees, exclusive of charges and penalties claimed is less than P1M tried by the proper MTC, MeTC and RTC.

1. Exclusive

1. In criminal offenses (1) over appeals from the judgments, resolutions, or orders of the RTC in tax cases originally decided by them, in their respective territorial jurisdiction and (2) over petitions for review of the judgments, resolutions or orders of the RTC in the exercise of their appellate jurisdiction over tax cases originally decided by the MeTCs, MTCs,and MCTCs in their respective jurisdiction;

2. In tax collection cases (1) over appeals from the judgments, resolutions, or orders of the RTC in tax collection cases originally decided by them, in their respective territorial jurisdiction and (2) over petitions for review of the judgments, resolutions or orders of the RTC in the the exercise of their appellate jurisdiction over tax collection cases originally decided by the MeTCs, MTCs,and MCTCs in their respective jurisdiction.

APPELLATE

Exclusive original or

appellate to review by appeal

1. Decisions of CIR in cases involving disputed assessment, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the NIRC or other laws administered by the BIR;

2. Inaction by the CIR in cases involving disputed assessment, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the NIRC or other laws administered by the BIR where the NIRC or other applicable law provides s specified period of action, in which case the inaction shall be deemed an implied denial;

3. Decisions, orders or resolutions of the RTCs in local taxes originally decided by them in the exercise of their original and appellate jurisdiction;

4. Decisions of the Commissioner of Customs (1) in cases involving liability for customs duties, fees or other charges, seizure, detention or release of property affected, fines, forfeiture, or other penalties in relation thereto, or (2) other matters arising under the Customs law, or other laws, part of laws or special laws administered by BOC;

5. Decisions of the Central Board of Assessment Appeals in the exercise of appellate jurisdiction over cases involving assessment and taxation of real property originally decided by the provincial or city board of assessment appeals;

6. Decision of the Secretary of Finance on custom cases elevated to him automatically for review from the decisions of the Commissioner of Customs which are adverse to the government under section 2315 of the TCC;

7. Decisions of the Secretary of Trade and Industry I the case of non- agricultural product, commodity or article and the secretary of Agriculture in the case of agricultural product, commodity or article, involving dumping duties and counterveiling duties under Secs. 301 and 302 of TCC and safeguard measures under RA **)), where the party may appeal the decision to impose or not to impose said duties. (RA 9282 and Rule 5, AM 05-11-07-CTA)

2.5.4. Sandiganbayan

ORIGINAL

1. Exclusive

Civil cases filed pursuant to E. O. Nos. 1, 2, 14 and 14-A (PCGG cases for recovery of ill-gotten wealth)

Three conditions:

1. What offenses: offenses must be cognizable by the Sandiganbayan (Hannah Serana vs. Sandiganbayan, G.R. No. 162059, January 22, 2008).

2. Offender: offender must be a public officer (Escobal vs. Garchitorena, G.R. No. 124644, February 5, 2004).

3. How committed: it must be committed in relation to their public office (Lacson vs. Executive Secretary, G.R. No. 128096, January 20, 1999).

2.5.5. Regional Trial Court (RTC)

2. Concurrent

a. with the SC

Petitions for certiorari, prohibition, mandamus, habeas corpus, injunction and other ancillary writs in aid of its appellate

jurisdiction including quo warranto arising in cases falling under E.O.s 1, 2, 14, 14-A (PCGG cases for recovery of ill-gotten wealth)

b. with the SC CA

Petition for writ of amparo and habeas data

APPELLATE

Final judgments, resolutions or orders of RTC whether in the exercise of their original or appellate jurisdiction (RA 8249) over crimes and civil cases falling within the original exclusive jurisdiction of the Sandiganbayan but which were committed by public officers below SG 27

 

1. Actions

in

which

the

subject

of

litigation

is

incapable

of

pecuniary estimation;

 

ORIGINAL

2. Actions involving title to or possession of real property or an interest therein, where the assessed value of such property exceeds P50,000 in Metro Manila, or P20,000 outside Metro

1. Exclusive

Manila, except forcible entry and unlawful detainer;

 

3. Actions involving marriage and marital relations;

4. Cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-judicial functions;

5. Other cases where the demand, exclusive of interest, damages, attorney’s fees, litigation expenses and costs, or the value of the property exceeds P400,000 in Metro Manila, or P300,000 outside Metro Manila (SC Circular No. 09-94);

6. Actions for annulment of MTC judgments;

 

7. Actions for recognition and enforcement of arbitration agreement, vacation or modification of arbitration award, application for arbitration award and supervision (Sec. 47, ADR Act of 2004);

8. Citizen suit (Sec. 41 of the Clean Air Act).

 

9. Admiralty and maritime cases where the demand or claim exceeds P400,000 in Metro Manila, or P300,000 outside Metro Manila, exclusive of interest, damages, attorney’s fees, litigation expenses, and costs (CLAID);

10. Probate proceedings, testate or intestate, where gross value of estate exceeds P400,000 in Metro Manila, or P300,000 outside Metro Manila

 

1. Cases involving violations of Intellectual Property Rights;

 

As a SPECIAL COMMERCIAL COURT

2. Cases enumerated under Sec. 5, PD 902-A (Intra-corporate disputes, fraud scheme cases, election cases, petitions for suspension of payments and/or rehabilitation proceedings).

2. Concurrent

Actions affecting ambassadors, other public ministers and consuls.

a. with the SC

 

b. with the SC and CA

1.

Petitions for certiorari, prohibition and mandamus against lower courts and bodies; and

2.

Petitions for habeas corpus and quo warranto

 

3.

Petition for continuing mandamus pursuant to the Rules of Procedure for Environmental Cases (A.M. No. 09-6-8-SC, effective 29 April 2010)

c. with the SC, CA and Sandiganbayan

Petition for writ of amparo and habeas data

 

d. With MeTC, MTCC, MTC, & MTCC

 

APPELLATE

All

cases

decided

by

the

MTCs

in

their

respective

territorial

jurisdiction

 

2.5.6. Family Courts

EXCLUSIVE ORIGINAL

1. Petitions for guardianship, custody of children, habeas corpus in relation to the latter;

2. Petitions for adoption of children and the revocation thereof;

3. Complaints for annulment of marriage, declaration of nullity of marriage and those relating to marital status and property relations of husband and wife or those living together under different status and agreements, and petitions for dissolution of conjugal partnership of gains;

4. Petitions for support and/or acknowledgment;

5. Summary judicial proceedings brought under the provisions of E.O. No. 209 or the Family Code;

6. Petitions for declaration of status of children as abandoned, dependent o neglected children, petitions for voluntary or involuntary commitment of children; the suspension, termination, or restoration of parental authority and other cases cognizable under P.D. No. 603, E.O. No. 56, (Series of 1986), and other related laws;

7. Petitions for the constitution of the family home; and

8. Cases of domestic violence against women and children, as defined in sec. 5(k), R.A. 8369, but which do not constitute criminal offenses subject to criminal prosecution and penalties

9. Cases covered by Juvenile Justice and Welfare Act (RA 9344)

2.5.7. Metropolitan Trial Courts (MeTC), Municipal Trial Courts (MTC)

and Municipal Circuit Trial Courts (MCTC)

1. Actions involving personal property valued at not more than P400,000 in Metro Manila and P300,000 outside Metro Manila;

2. The following cases or actions where the value in consideration does not exceed P400,000 in Metro Manila and P300,000 outside Metro Manila, in both cases, exclusive of interest, damages, attorney’s fees, litigation expenses and costs (CLAID):

a. Actions demanding sums of money; b. Demand or claim in admiralty and maritime cases; c. The estate value in probate proceedings, interstate or estate;

3. Actions involving title or possession of real property where the assessed value does not exceed P50,000 in Metro Manila, or P20,000 outside Metro Manila, exclusive of interest, damages, attorney’s fees, litigation expenses, and costs (CLAID);

4. Forcible entry and unlawful detainer, provided that in cases where the defendant raises the question of ownership and the question of possession cannot be resolved without deciding on the issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession;

ORIGINAL

1. Exclusive

NOTE: The jurisdictional amount was adjusted pursuant to Sec. 5, RA 7691, now being the 2 nd 5-year period from the date of effectivity of said act.

2. Concurrent

a. with RTC

3. Delegated

Cadastral and land registration cases assigned by the SC where there is a). no controversy or opposition, or b). where there is controversy, the contested lot valued at not more than P100,000.

4. Special

Petition for habeas corpus or application for bail in criminal cases in the absence of all RTC Judges in a province or city (BP 129, as amended, Chapter III, Sec 35)

 

1.

Forcible entry and unlawful detainer, irrespective of the amount of damages or unpaid rentals sought to be recovered; but attorney’s fees shall not exceed P20,000;

5. Summary Procedure

2. All other cases, except probate proceedings, where total claim does not exceed P200,000.00 in Metro Manila, or P100,000 outside Metro Manila, exclusive of interest and costs.

3. Small claims cases where the amount of the claim for payment or reimbursement of money does not exceed P100,000.00

 

2.5.8. Shari’a Court (P.D. No. 1083)

 

ORIGINAL

1. All cases involving custody, guardianship, legitimacy, paternity and filiation arising under PD No. 1083;

 

2. All cases involving disposition, distribution and settlement of

1. Exclusive

the estate of a deceased Muslim, probate of wills, issuance of letters of administration or appointment of administrators or executors regardless of the nature or the aggregate value of the property;

3. Petitions for declaration of absence and death and for cancellation and correction of entries in the Muslim Registries mentioned in Title VI, Book Two of P.D. No. 1083;

NOTE: The Shari’a District Courts are equivalent to the RTC in rank which were established in certain provinces of Mindanao where the Code of Muslim Personal Laws of the Philippines is enforced.

4. All actions arising from customary contracts in which the parties are Muslims, if they have not specified which law shall govern their relations;

(P.D. No. 1083)

5. All petitions for mandamus, prohibition, injunction, certiorari, habeas corpus, and all auxiliary writs and processes in aid of its appellate jurisdiction (Art. 143[1]).

2.

Concurrent with

1. Petitions by Muslim for the constitution of the family home, change of name and commitment of insane person to any asylum;

EXISTING CIVIL COURTS

2. All other personal and real actions not mentioned in paragraph 1(d) wherein the parties involved are Muslims except those for forcible entry and unlawful detainer which shall fall under the exclusive original jurisdiction of the Municipal Circuit Courts; and

3. All special civil actions for interpleader or declaratory relief where the parties are Muslims or the property involved belong exclusively to a Muslim (Art. 143[2]).

APPELLATE

All cases tried in the Shari’a Circuit Court within their territorial jurisdiction.

NOTE: The Shari’a District Court shall decide every case appealed to it on the basis of the evidence and records transmitted as well as such memoranda, briefs or oral arguments as the parties may submit (Art. 144[2]).

NOTE: The decisions of the Shari’a District Courts whether on appeal from the Shari’a Circuit Courts or not, shall be final. The Supreme Court shall, however, continue to exercise original and appellate jurisdiction over certain issues as provided by the Constitution (Art. 145).

2.7. Jurisdiction over Small Claims cases:

Over all actions which are:

a. purely civil in nature where the claim or relief prayed for by the plaintiff is solely for payment or reimbursement of sum of money, and

b. the civil aspect of criminal action, or reserved upon the filing of the criminal action in court, pursuant to Rule of 111.

Court which has jurisdiction.

To be tried before the Metropolitan trial Courts, Municipal Trial Courts in Cities, Municipal Trial Courts and Municipal Circuit Trial Courts for payment of money where the value of the claim does NOT exceed One Hundred Thousand Pesos (P100,000.00) exclusive of interest and costs.

These claims or demands may be:

a.For

money owned under any of the following:

1)

Contract of Lease;

2)

Contract of Loan;

3)

Contract of Services;

4)

Contract of Sale; or

5)

Contract of Mortgage.

b.

For damages arising from any of the following:

1)

Fault or negligence;

2)

Quasi-contract; or

3)

Contract.

Immediate execution of judgment in Small Claims cases.

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

Rule on Summary Procedure

A. Civil Cases:

1. All cases of forcible entry and unlawful detainer, irrespective of the amount of damages or unpaid rentals sought to be recovered; but attorney's fees shall not exceed

P20,000.00.

2. All other civil cases, EXCEPT probate proceedings, where the total amount of the plaintiff's claim does not exceed P100, 000.00 or P200,000.00 in Metro Manila, exclusive of interest and costs. (as amended by A.M. 02-11-09-SC, effective November 25, 2002)

Criminal Cases:

1.

Violations of traffic laws, rules and regulations;

2.

Violations of the rental law;

3.

Violations of Municipal or city ordinances;

4.

All other criminal cases where the penalty prescribed by law for the offense charged is imprisonment not exceeding 6 months, or a fine not exceeding P1,000.00, or both, irrespective of other imposable penalties,

5.

Offenses involving damage to property through criminal negligence, this Rule shall govern where the imposable fine does not exceed P10,000.00

Note:

This Rule shall NOT apply to a civil case where the plaintiff’s cause of action is pleaded in the same complaint with another cause of action subject to the ordinary procedure; nor to a criminal case where the offense charged is necessarily related to another criminal case subject to the ordinary procedure.

Forcible entry and unlawful detainer summary proceedings:

An action for forcible entry is filed in the municipal trial court and is a summary action, while accion publiciana is a plenary action in the RTC. x x x Because they only resolve issues of possession de facto, ejectment actions are summary in nature, while accion publiciana (for the recovery of possession) and accion reivindicatoria (for the recovery of ownership) are plenary actions.48 The purpose of allowing actions for forcible entry and unlawful detainer to be decided in summary proceedings is to provide for a peaceful, speedy and expeditious means of preventing an alleged illegal possessor of property from unjustly taking and continuing his possession during the long period it would take to properly resolve the issue of possession de jure or ownership, thereby ensuring the maintenance of peace and order in the community; otherwise, the party illegally deprived of possession might take the law in his hands and seize the property by force and violence. An ejectment case cannot be a substitute for a full blown trial for the purpose of determining rights of possession or ownership. (Fiorello R. Jose Vs. Roberto Alfuerto, et al. G.R. No. 69380. November 26, 2012)

Barangay Conciliation:

General rule:

The lupon tagapamayapa of each barangay shall have authority to bring together the parties residing in the same city or municipality for amicable settlement of ALL disputes

EXCEPT

a. Where one party is the government, or any subdivision or instrumentality thereof; however, when it is only one of the contending parties, a confrontation should still be undertaken among the other parties (Gegare v. CA, G.R. No. 83907. September 13, 1989)

b. Where one party is a public officer or employee, and the dispute relates to the performance of his official functions;

c. Offenses punishable by imprisonment exceeding 1 year or a fine exceeding P5,000;

d. Offenses where there is no private offended party;

e. Where the dispute involves real properties located in different cities or municipalities unless the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon;

f. Disputes involving parties who actually reside in barangays of different cities or municipalities, except where such barangay units adjoin each other and the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon;

g. Such other classes of disputes which the President may determine in the interest of justice or upon the recommendation of the Sec. of Justice; and

h. Where one of the parties is a juridical entity (Sec. 408, R.A. 7160)

i. Where the dispute arises from the Comprehensive Agrarian Reform Law

j. The submission of disputes before the Lupon prior to their filing with the court or other government offices are not applicable to labor cases. (Montoya v. Escayo, G.R. No. 82211- 12 March 21, 1989)

k. An action for annulment of a compromise judgment which as a general rule is immediately executory and accordingly, beyond the authority of the Barangay Court to change or modify.(Sanchez v. Tupaz, G.R. No. 76690 February 29, 1988)

l. Proceedings where relief is sought under R.A. No. 9262 or the Anti-Violence against Women and their Children Act (Sec. 33, R.A. No. 9262)

Other Instances where parties may go directly to court without the need of prior barangay conciliation:

a. Where the accused is under detention

b. Where a person has otherwise been deprived of personal liberty calling for habeas corpus proceedings;

c. Where actions are coupled with provisional remedies such as preliminary injunction, attachment, replevin and support pendent lite; and

d. Where the action may otherwise be barred by the statute of limitations. (Section 412, LGC)

Barangay conciliation not required in case of juridical entity:

Referral of a dispute to the Lupon is required only in cases involving natural persons, and not where any of the parties is a juridical person such as a corporation, partnership, corporation sole, testate or intestate, estate, etc. (Vda. De Borromeo v. Pogoy, G.R. No. L- 63277. November 29, 1983)

Nature and effects of non-compliance with barangay conciliation:

As cited in the case Sanchez v. Tupaz, referral to the Lupon is compulsory (as ruled in the cited case of Morato vs. Go, 125 SCRA 444), [1983] and non-compliance of the same could

affect the sufficiency of the cause of action and make the complaint vulnerable to dismissal on the ground of lack of cause of action or prematurity (Peregrina vs. Panis, 133 SCRA 75).

Venue of barangay conciliation.

1. Disputes between or among persons actually residing in the same barangay shall be

brought for amicable settlement before the Lupon of said barangay.

2. Actual residents of different barangays within the same city or municipality shall be

brought in the barangay where the respondent or any of the respondents actually resides, at

the election of the complainant

3. All disputes which involved real property or any interest therein shall be brought in

the barangay where the real property or any part thereof is situated.

4. Disputes arising at the workplace where the contending parties are employed or at

the institution where the contending parties are enrolled to study, the barangay where such workplace or institution is located. (Sec. 409, LGC).

Nature of Amicable Settlement

[A]n amicable settlement reached at the barangay conciliation proceedings, like the Kasunduang Pag-aayos in this case, is binding between the contracting parties and, upon its perfection, is immediately executory insofar as it is not contrary to law, good morals, good customs, public order and public policy. This is in accord with the broad precept of Article 2037 of the Civil Code. (Crisanta Alcaraz Miguel vs. Jerry D. Montanez, G.R. No. 191336, January 25,

2012)

Effect of amicable settlement:

Being a by-product of mutual concessions and good faith of the parties, an amicable settlement has the force and effect of res judicata even if not judicially approved. It transcends being a mere contract binding only upon the parties thereto, and is akin to a judgment that is subject to execution in accordance with the Rules. (Crisanta Alcaraz Miguel vs. Jerry D. Montanez, G.R. No. 191336, January 25, 2012)

Remedy of Execution of settlement, when available?

Modes of execution of amicable settlement or arbitration award:

Thus, under Section 417 of the Local Government Code, such amicable settlement or arbitration award may be enforced by

(1)

Execution

settlement, or

by

the

Barangay

Lupon

within

six

(6)

months

from

the

date

of

(2) by filing an action to enforce such settlement in the appropriate city or municipal court, if beyond the six-month period.

Execution before the barangay:

Under the first remedy, the proceedings are covered by the Local Government Code and the Katarungang Pambarangay Implementing Rules and Regulations. The Punong Barangay is called upon during the hearing to determine solely the fact of non-compliance of the terms of the settlement and to give the defaulting party another chance at voluntarily complying with his obligation under the settlement.

Execution before the court:

Under the second remedy, the proceedings are governed by the Rules of Court, as amended. The cause of action is the amicable settlement itself, which, by operation of law, has the force and effect of a final judgment.

Execution is available only when there is no repudiation of the amicable settlement:

It must be emphasized, however, that enforcement by execution of the amicable settlement, either under the first or the second remedy, is only applicable if the contracting parties have not repudiated such settlement within ten (10) days from the date thereof in accordance with Section 416 of the Local Government Code.

Remedies if a party repudiated the settlement

If the amicable settlement is repudiated by one party, either expressly or impliedly, the other party has two options, namely, (1) to enforce the compromise in accordance with the Local Government Code or Rules of Court as the case may be, or (2) to consider it rescinded and insist upon his original demand. This is in accord with Article 2041 of the Civil Code, which qualifies the broad application of Article 2037, viz: “If one of the parties fails or refuses to abide by the compromise, the other party may either enforce the compromise or regard it as rescinded and insist upon his original demand.”

In the case at bar, the Revised Katarungang Pambarangay Law provides for a two-tiered mode of enforcement of an amicable settlement, to wit:

(a) by execution by the Punong Barangay which is quasi-judicial and summary in nature

on mere motion of the party entitled thereto; and

(b) an action in regular form, which remedy is judicial.

However, the mode of enforcement does not rule out the right of rescission under Art. 2041 of the Civil Code. The availability of the right of rescission is apparent from the wording of Sec. 417 itself which provides that the amicable settlement "may" be enforced by execution by the lupon within six (6) months from its date or by action in the appropriate city or municipal court, if beyond that period. The use of the word "may" clearly makes the procedure provided in the Revised Katarungang Pambarangay Law directory or merely optional in nature.

The CA took off on the wrong premise that enforcement of the Kasunduang Pag-aayos is the proper remedy, and therefore erred in its conclusion that the case should be remanded to the trial court. The fact that the petitioner opted to rescind the Kasunduang Pag-aayos means that she is insisting upon the undertaking of the respondent under the original loan contract. Thus, the CA should have decided the case on the merits, as an appeal before it, and not prolong the determination of the issues by remanding it to the trial court. Pertinently, evidence abounds that the respondent has failed to comply with his loan obligation. In fact, the Kasunduang Pag-aayos is the well nigh incontrovertible proof of the respondent’s indebtedness

with the petitioner as it was executed precisely to give the respondent a second chance to make good on his undertaking. And since the respondent still reneged in paying his indebtedness, justice demands that he must be held answerable therefor. (Crisanta Alcaraz Miguel vs. Jerry D. Montanez, G.R. No. 191336, January 25, 2012)

2.8. Totality Rule

Where there are several claims or causes of action 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 causes of action, irrespective of whether the causes of action arose out of the same or different transactions. The causes of action in favor of two or more plaintiffs or against two or more defendants should arise out of the same transaction or series of transactions and there should be a common question of law or fact as provided in Sec. 6, Rule 3 (Flores v. Mallare-Philips, L- 66620, September 24, 1986).

3. Civil Procedure

3.1. Kinds of Actions:

3.1.1. Meaning of Ordinary Civil Actions

A civil action is one by which a party sues another for the enforcement or protection of a right, or the prevention or redress of a wrong (Rule 1, Section 3(a), Rules of Court). It is governed by ordinary rules on action.

3.1.2. Meaning of Special Civil Actions

It is one which is also governed by the rules of ordinary civil actions, but subject to the specific rules prescribed for such particular special civil action (Rule1, Sec. 3[a] 2 nd par., Rule 1).

3.1.3. Meaning of Criminal Actions

It is one by which the State prosecutes a person for an act or omission punishable by law. (Sec. 3[b], Rule 1)

3.1.4. Civil Actions versus Special Proceedings

A special proceeding is a remedy by which a party seeks to establish a status, a right, or a particular fact. It is distinguished from an ordinary civil action where a party sues another for the enforcement or protection of a right, or the prevention or redress of a wrong. To initiate a special proceeding, a petition and not a complaint should be filed. (Ramon Ching and Po Wing Corp. v. Rodriguez, et. al., G.R. No. 192828, November 28, 2011)

3.1.5. Real Actions and Personal Actions: Issue as to venue:

Real Actions are actions affecting title to or the recovery of possession of real property, or an interest therein, or forcible entry and detainer actions. A real action is “local,” i.e., its venue depends upon the location of the property involved in the litigation. (Riano).

Personal Actions are actions founded on privity of contract or for the enforcement or

resolution of a contract, or for recovery of personal property (Feria Noche, Civil Procedure Annotated, Vol. I). A personal action is “transitory,” i.e., its venue depends upon the residence of the plaintiff or the defendant at the option of the plaintiff (Riano).

Action to annul Sale and Title over a real property is a Real Action:

Civil Case No. 01-1567, being an action for Annulment of Sale and Titles resulting from the extrajudicial foreclosure by Union Bank of the mortgaged real properties, is classified as a real action. In Fortune Motors v. Court of Appeals, this Court held that a case seeking to annul a foreclosure of a real estate mortgage is a real action, viz: An action to annul a real estate mortgage foreclosure sale is no different from an action to annul a private sale of real property. (Muñoz v. Llamas, 87 Phil. 737, 1950). While it is true that petitioner does not directly seek the recovery of title or possession of the property in question, his action for annulment of sale and his claim for damages are closely intertwined with the issue of ownership of the building which, under the law, is considered immovable property, the recovery of which is petitioner’s primary objective. The prevalent doctrine is that an action for the annulment or rescission of a sale of real property does not operate to efface the fundamental and prime objective and nature of the case, which is to recover said real property. It is a real action. (Paglaum Management & Development Corp. And Health Marketing Technologies, Inc., Vs. Union Bank Of The Philippines, Notary Public John Doe, And Register Of Deeds Of Cebu City And Cebu Province, $J. King & Sons Co., Inc. Intervenor, G.R. No. 179018, June 18, 2012)

3.1.6. Local and Transitory Actions

Local Actions are actions which can only be instituted in a particular place. Transitory Actions are actions where the venue of which is generally dependent upon the residence of the parties regardless of where the cause of action arise.

3.1.7. Actions In Rem, In Personam, Quasi- in- Rem: Issue as to jurisdiction in relation to

service of summons (Rule 14):

In Rem:

One which is not directed against a particular person but on the thing or res itself and the relief sought is binding upon the whole world.

The thing or res may be personal or real property or it may be a status, right, or a particular fact (Primer-Reviewer on Remedial Law, Vol.I, Civil Procedure, Riguera, 1 st ed., 2009).

The object is to bar indifferently all who might be minded to make any objection against the right sought to be enforced, hence the judgment therein is binding theoretically upon the whole world, e.g., expropriation (Regalado).

In Personam One which is directed against a particular person and the relief sought is binding upon such person e.g., action for sum of money or for specific performance.

Service of summons in actions in personam

Where the action is in personam [footnote: An action in personam is one which seeks to enforce personal rights and obligations against a defendant and is based on the jurisdiction of

the person, although it may involve his right to, or the exercise of ownership of, specific property, or seek to compel him to control or dispose of it in accordance with the mandate of the court. (See Belen v. Chavez , G.R. No. 175334, March 26, 2008, 549 SCRA 479, 481.)] and the defendant is in the Philippines, service of summons may be made through personal service, that is, summons shall be served by handing to the defendant in person a copy thereof, or if he refuses to receive and sign for it, by tendering it to him. If the defendant cannot be personally served with summons within a reasonable time, it is then that substituted service may be made. Personal service of summons should and always be the first option, and it is only when the said summons cannot be served within a reasonable time can the process server resort to substituted service. (Planters Development Bank, Vs. Julie Chandumal, G.R. No. 19561905 September 2012)

Quasi in Rem:

It is a proceeding where an individual is named as defendant, and the purpose of the proceeding is to subject his interest therein to the obligation or lien burdening the property e.g., Quieting of Title where the object is in rem (real property) and the subject is in personam (defendant). The judgment entered in this proceeding is conclusive only between the parties (Feria Noche, Civil Procedure, Vol. I)

Whether a proceeding is in rem, or in personam or quasi in rem is determined by its nature and purpose (Yu v. Pacleb, etc., G.R. No. 172172, 24 Feb. 2009).

3.1.8. Independent Civil Actions

Rules on independent civil actions: Nature:

In the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines, 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 no case, however, may the offended party recover damages twice for the same act or omission charged in the criminal action. (Rule 111, Section 3)

Cases which are considered as an independent civil action:

Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the following (constitutional) rights and liberties of another person shall be liable to the latter for damages… x x x Article 32, Civil Code (in italics added for clarification)

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. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence. Article 33, Civil Code

When a member of a city or municipal police force refuses or fails to render aid or protection to any person in case of danger to life or property, such peace officer shall be primarily liable for damages, and the city or municipality shall be subsidiarily responsible therefor. The civil action herein recognized shall be independent of any criminal proceedings, and a preponderance of evidence shall suffice to support such action. Article 34, Civil Code

Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter. Article 2176, Civil Code

3.2. Cause of Action

3.2.1 Meaning of Cause of Action

It is the act or omission by which a party violates the right of another (Rule 2, Sec. 2).

A cause of action is defined in Section 2, Rule 2 of the Rules of Court as the act or omission

by which a party violates the right of another. (Goodland Company, Inc., vs. Asia United Bank, Abraham Co, Atty. Joel T. Pelicano And The Register Of Deeds Of Makati City, G.R. No. 195561, March 14, 2012)

Elements of Cause of Action:

1)

A legal right of the plaintiff;

 

2)

A correlative duty of the defendant to respect plaintiff’s right; and

3)

An

act or omission of the defendant in

violation of the plaintiff’s right with

consequential injury or damage to the plaintiff for which he may maintain an action for

recovery or other relief (Relucio vs. Lopez, 373 SCRA 578, 2002).

Section 2, Rule 2 of the Rules of Court defines a cause of action as an act or omission by which a party violates the right of another. A complaint states a cause of action when it contains three (3) essential elements of a cause of action, namely:

1)

the legal right of the plaintiff,

2)

the correlative obligation of the defendant, and

3)

the act or omission of the defendant in violation of said legal right (Juana Complex I

Homeowners Association, Inc., et al. vs. Fil-Estate Land, Inc., G.R. No. 152272, March 5, 2012)

3.2.2. Right of Action versus Cause of Action

Right of action is the right to commence and prosecute an action to obtain the relief sought, while cause of action is the act or omission by which a party violates the right of another (Rule 2, Sec. 2).

Elements of Right of Action:

a) Existence of the cause of action;

b) Performance of all conditions precedent; and

c) The action must be instituted by the proper party.

3.2.3. Failure to State Cause of Action

Where there is failure to state a cause of action in a pleading, the remedy of the defendant is to move for its dismissal on the ground that the pleading asserting the claim states no cause of action. Rule 16, Sec 1 (g)

3.2.4.

Test of Sufficiency of Action

Whether or not admitting the facts alleged, the court could render a valid judgment upon the same in accordance with the prayer in the complaint (Misamis Occidental II Cooperative, Inc. v. David, 468 SCRA 63).

The question of whether the complaint states a cause of action is determined by its averments regarding the acts committed by the defendant. Thus, it must contain a concise statement of the ultimate or essential facts constituting the plaintiff’s cause of action. To be taken into account are only the material allegations in the complaint; extraneous facts and circumstances or other matters aliunde are not considered.

The test of sufficiency of facts alleged in the complaint as constituting a cause of action is whether or not admitting the facts alleged, the court could render a valid verdict in accordance with the prayer of said complaint. Stated differently, if the allegations in the complaint furnish sufficient basis by which the complaint can be maintained, the same should not be dismissed regardless of the defense that may be asserted by the defendant. (Juana Complex I Homeowners Association, Inc., et al. vs. Fil-Estate Land, Inc., G.R. No. 152272, March 5, 2012)

3.2.5. Splitting a Single Cause of Action and its Effects

Splitting a single cause of Action

The act of dividing a single cause of action, claim or demand into two or more parts, and bringing the suit for one of such parts only, intending to reserve the rest for another separate action is the prohibited act of splitting a single cause of action (Regalado).

Effects

If two or more suits are instituted on the basis of the same cause of action, the filing of one or a judgment upon the merits in any one is available as a ground for the dismissal of the others (Rule 2, Sec. 4).

When a single cause of action is split, the remedy of the defendant is to move for its dismissal under Rule 16 on the ground that:

1) There is another action pending between the same parties for the same cause, or litis pendentia (Sec. 1[e]); or

2) If the first action has already been finally terminated, on the ground of res judicata (Sec. 1[f]).

The well-entrenched rule is that "a party cannot, by varying the form of action, or adopting a different method of presenting his case, escape the operation of the principle that one and the same cause of action shall not be twice litigated.This Court has laid down the test in determining whether or not the causes of action in the first and second cases are identical, to wit: would the same evidence support and establish both the present and former cause of action? If so, the former recovery is a bar; if otherwise, it does not stand in the way of the former action. (Goodland Company, Inc., vs. Asia United Bank, Abraham Co, Atty. Joel T. Pelicano And The Register Of Deeds Of Makati City, G.R. No. 195561, March 14, 2012)

What is litis pendentia?

Litis pendentia is a Latin term, which literally means "a pending suit" and is variously referred to in some decisions as lis pendens and auter action pendant. As a ground for the dismissal of a civil action, it refers to the situation where two actions are pending between the same parties for the same cause of action, so that one of them becomes unnecessary and vexatious. It is based on the policy against multiplicity of suits. (Philippine National Bank vs. Gateway Property Holdings, Inc., G.R. No. 181485, February 15, 2012)

3.2.6. Joinder and Mis-joinder of Causes of Action.

Joinder of Causes of Action:

The assertion, in the alternative or otherwise, of as many causes of action as a party may have against another in one pleading alone is valid. (Rule 2, Section 5)

Requisites for joinder of parties:

a) The party joining the causes of action shall comply with the rules on joinder of

parties;

b) The joinder shall NOT include special civil action or actions governed by special rules;

c) Where the causes of action are between the same parties but pertain to different

venues or jurisdiction, the joinder may be allowed in the RTC provided that:

1) one of the causes of action falls within the jurisdiction of the RTC; and 2) the venue lies therein.

d) Where the claims in all the causes of action are principally for recovery of money, the

aggregate amount claimed shall be the test of jurisdiction (Totality Rule, Sec. 33[1], B.P. 129).

Elements for Joinder of Parties

a) There must be a right to relief in respect to or arising from the same transaction or

series of transaction;

b) There is a question of fact or law common to all the plaintiffs or defendants; and

c) Such joinder is not otherwise proscribed by the provisions of the Rules on jurisdiction and venue (Sec. 6, Rule 3).

Nature of joinder of causes of action:

The rule on joinder of causes of action is purely permissive and the plaintiff can always file separate actions for each cause of action (Baldovir v. Sarte, 36 Phil. 550).

Conditions of causes of action:

The rule on permissive joinder of causes of action is subject to the rules regarding jurisdiction, venue and joinder of parties.

Note: When the joinder refers to joinder of indispensable parties, joinder is COMPULSORY (Sec. 7, Rule 3). The provision allowing joinder of causes of action which pertains to different jurisdictions under Section 5 (c) of Rule 2 applies only if the joinder is in the RTC.

Misjoinder of Causes of Action

Two or more causes of action are joined in one complaint when they should not have been joined. (Rule 2, Section 6)

Misjoinder of causes of action is NOT a ground for dismissal of an action. A misjoined cause of action may, on motion of a party or on the initiative of the court, be severed and proceeded with separately (Rule 2, Section 6)

3.3. Parties to Civil Actions:

3.3.1. Real parties-in-interest; indispensable parties; representatives as parties; necessary parties; indigent parties; alternative defendants

Real Party in Interest (Rule 3, Sec. 2)

The party who stands to be benefited or injured by the judgment in the suit or the party entitled to the avails of the suit.

General Rule: Unless otherwise authorized by law or these Rules, every action must be prosecuted and defended in the name of the real party in interest. Exception: An exception to the rule that every action must be prosecuted or defended in the name of the real party in interest is in the case of representatives as parties (Rule 3, Section 3) To be a real party-in-interest, the interest must be ‘real’, which is a present substantial interest as distinguished from a mere expectancy or a future, contingent subordinate or consequential interest (Fortich v. Corona, 289 SCRA 624). It is an interest that is material and direct, as distinguished from a mere incidental interest in the question (Samaniego v. Aguila, 334 SCRA

438).

Meaning of “interest”.

Interest within the meaning of the Rules of Court means material interest or an interest in issue to be affected by the decree or judgment of the case, as distinguished from mere curiosity about the question involved. A real party in interest is the party who, by the substantive law, has the right sought to be enforced.

Applying the foregoing rule, it is clear that Atty. Aceron is not a real party in interest in the case below as he does not stand to be benefited or injured by any judgment therein. He was merely appointed by the petitioners as their attorney-in-fact for the limited purpose of filing and prosecuting the complaint against the respondents. Such appointment, however, does not mean that he is subrogated into the rights of petitioners and ought to be considered as a real party in interest. (Theodore And Nancy Ang, Represented By Eldrige Marvin B. Ceron, Vs. Spouses Alan And Em Ang, Respondents. G.R. No. 186993, August 22, 2012)

Effect of Failure to include Real Party in Interest

Real party in interest applies both to the plaintiff and defendant. The suit may be dismissed if neither of them is a Real party in interest REMEDY where Real Party in Interest is NOT impleaded:

Amendment of the pleadings or the complaint may be deemed amended to include the

RPII.

If the suit is not brought in the name of or against the real party in interest, a motion to dismiss may be filed on the ground that the complaint states no cause of action (Sec. 1[g], Rule 16; Regalado, 2010).

Only parties to the contract may sue. However, a beneficiary of a stipulation pour autrui may demand its fulfillment.

In Oposa v. Factoran (G.R. No. 101083, 1993), minors represented by their parents were held as real parties in interest to file an action to annul timber licenses issued by the state under the following principles:

a) Inter-generational responsibility;

b) Inter-generational justice;

c) The right of the Filipinos to a balanced and healthful ecology; and

d) Minors represent themselves and the generation to come.

Court requires that an action must be brought in the name but not necessarily by the real party in interest. In fact, the practice is for an attorney in fact to bring the action in the name of the plaintiff (Tuason v. Bolanos, G.R. No. L-25894, Jan. 30, 1971).

Indispensable parties

Those without whom no final determination can be had of an action; they must be joined under all conditions (Rule 3, Sec.7).

The definition in the Rules of Court, Section 7, Rule 3 thereof, of indispensable parties as "parties in interest without whom no final determination can be had of an action" has been jurisprudentially amplified. In Sps. Garcia v. Garcia, et.al., this Court held that:

An indispensable party is a party who has such an interest in the controversy or subject matter that a final adjudication cannot be made, in his absence, without injuring or affecting that interest, a party who has not only an interest in the subject matter of the controversy, but also has an interest of such nature that a final decree cannot be made without affecting his interest or leaving the controversy in such a condition that its final determination may be wholly inconsistent with equity and good conscience. It has also been considered that an indispensable party is a person in whose absence there cannot be a determination between the parties already before the court which is effective, complete, or equitable. Further, an indispensable party is one who must be included in an action before it may properly go forward. (Simny G. Guy, Geraldine G. Guy, Gladys G. Yao, And The Heirs of the Late Grace G. Cheu Vs. Gilbert G. Guy, G.R. No. 189486, September 05, 2012)

The nature of the solidary obligation under the surety does not make one an indispensable party. An indispensable party is a party-in-interest without whom no final determination can be had of an action, and who shall be joined mandatorily either as plaintiffs

or defendants. The presence of indispensable parties is necessary to vest the court with jurisdiction, thus, without their presence to a suit or proceeding, the judgment of a court cannot attain real finality. The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. (Living @ Sense, Inc. Vs. Malayan Insurance Company, Inc. G.R. No. 193753. September 26, 2012)

Purpose of the rules

The purpose of the rules on joinder of indispensable parties is a complete determination of all issues not only between the parties themselves, but also as regards other persons who may be affected by the judgment. A decision valid on its face cannot attain real finality where there is want of indispensable parties. (Philip L. Go, Pacifico Q. Lim And Andrew Q. Lim, Vs. Distinction Properties Development And Construction, Inc. G.R. No. 194024, April 25, 2012)

Burden of procuring indispensable parties lis with the plaintiff:

The burden of procuring the presence of all indispensable parties is on the plaintiff. (39 Amjur [sic] 885). The evident purpose of the rule is to prevent the multiplicity of suits by requiring the person arresting a right against the defendant to include with him, either as co- plaintiffs or as co-defendants, all persons standing in the same position, so that the whole matter in dispute may be determined once and for all in one litigation. (Palarca v. Baginsi, 38 Phil. 177, 178).

Effects of non-joinder of indispensable parties

The presence of all indispensable parties is a condition sine qua non for the exercise of judicial power. It is precisely when an indispensable party is not before the court that the action should be dismissed (Sepulveda, Sr. v. Pelaez, G.R. No. 152195, 31 January 2005).

The court cannot proceed without their presence. Any judgment rendered by the court would be null and void.

Settled is the rule that joinder of indispensable parties is compulsory being a sine qua non for the exercise of judicial power, and, it is precisely “when an indispensable party is not before the court that the action should be dismissed” for such absence renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. (Simny G. Guy, Geraldine G. Guy, Gladys G. Yao, And The Heirs of the Late Grace G. Cheu Vs. Gilbert G. Guy, G.R. No. 189486, September 05, 2012)

Representative as parties

Someone acting in a fiduciary capacity (i.e. trustees of an express trust, guardians, executors or administrators). In this case, the rule requires that the name of the beneficiary shall be included in the title of the case and shall be deemed as the real party in interest (Rule 3, Sec. 3).

The petitioner’s reliance on Section 3, Rule 3 of the Rules of Court to support their conclusion that Atty. Aceron is likewise a party in interest in the case below is misplaced. Section 3, Rule 3 of the Rules of Court provides that:

Sec. 3. Representatives as parties. Where the action is allowed to be prosecuted and defended by a representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the case and shall be deemed to be the real property in interest. A representative may be a trustee of an expert trust, a guardian, an executor or administrator, or a party authorized by law or these Rules. An agent acting in his own name and for the benefit of an undisclosed principal may sue or be sued without joining the principal except when the contract involves things belonging to the principal. (Emphasis ours)

Nowhere in the rule cited above is it stated or, at the very least implied, that the representative is likewise deemed as the real party in interest. The said rule simply states that, in actions which are allowed to be prosecuted or defended by a representative, the beneficiary shall be deemed the real party in interest and, hence, should be included in the title of the case.

Indeed, to construe the express requirement of residence under the rules on venue as applicable to the attorney-in-fact of the plaintiff would abrogate the meaning of a "real party in interest", as defined in Section 2 of Rule 3 of the 1997 Rules of Court vis-à-vis Section 3 of the same Rule. (Theodore And Nancy Ang, Represented By Eldrige Marvin B. Ceron, Vs. Spouses Alan And Em Ang, Respondents. G.R. No. 186993, August 22, 2012)

Necessary Parties

Those who are not indispensable but who ought to be joined as a party if complete relief is to be accorded as to those already parties, or for a complete determination or settlement of the claim subject of the action; may or may not be joined (i.e. joint debtor is a necessary party in a suit against his co-debtor) (Rule 3, Sec. 8).

Indigent Parties

A party may be authorized to litigate his action, claim or defense as an indigent if the court, upon an ex parte application and hearing, is satisfied that the party is one who has no money or property sufficient and available for food, shelter and basic necessities for himself and his family.

Effects of declaration of indigency:

Such authority shall include an exemption from payment of docket and other lawful fees, and of transcripts of stenographic notes which the court may order to be furnished him. The amount of the docket and other lawful fees which the indigent was exempted from paying shall be a lien on any judgment rendered in the case favorable to the indigent, unless the court otherwise provides. (Rule 3, Sec. 21)

Exemption from Payment of Legal fees (Sec.19. Rule 141)

Requisites:

1) Party must have a gross income and that of their immediate family do not exceed an amount double the monthly minimum wage of an employee; and

2) Party do not own real property with a fair market value as stated in the current tax declaration of more than P300,000.00.

Grant of the application mandatory if requisites are present:

If the applicant for exemption meets the salary and property requirements under Section 19 of Rule 141, then the grant of the application is mandatory. On the other hand, when the application does not satisfy one or both requirements, then the application should not be denied outright; instead, the court should apply the "indigency test" under Section 21 of Rule 3 and use its sound discretion in determining the merits of the prayer for exemption (Algura v. LGU, G.R. No. 150135, October 30, 2006).

Alternative Defendants

Where the plaintiff is uncertain against who of several persons he is entitled to relief, he may join any or all of them as defendants in the alternative, although a right to relief against one may be inconsistent with a right to relief against the other. (Rule 3, Section 13)

3.3.2. Compulsory and Permissive Joinder of Parties

Compulsory Joinder of Parties

Those without whom no final determination can be had of an action; they must be joined under all conditions (Rule 3, Sec.7). (indispensable parties must be joined compulsorily)

Permissive Joinder of Parties (Rule 3, Sec. 6)

Requisites:

a) There must be a right to relief in respect to or arises out of the same transaction or

series of transactions;

b) There is a question of law or fact common to all the plaintiffs or all the defendants;

and

c) Such joinder is not proscribed by the provisions of the rules on jurisdiction and venue.

What is series of transaction?

Series of transaction” means separate dealings with the parties but all of which dealings are directly connected with the same type of subject-matter of the suit (Regalado).

3.3.3. Misjoinder and Non-joinder of Parties

Both are NOT grounds for the dismissal of the action. Parties may be dropped or added by order of the court motu proprio or on motion of any party at any stage of the action and on such terms as are just. (Rule 3, Section 11)

3.3.4. Class Suit

A suit brought by or defended by a representative member or members of a large group of persons on behalf of all the members of the group. (Rule 3, Section 12)

Requisites:

2) Persons are so numerous that it is impracticable to join all as parties; 3) Parties actually before the court are sufficiently numerous and representative so that all interests concerned are fully protected; 4) The representatives sue or defend for the benefit of all. (Rule 3, Section 12)

The complaint must specially state that the same is being brought in behalf of others with whom parties share a common interest (Borlasa v. Polistico, 47 Phil. 345).

In case of conflict no class suit:

If there is a conflict of interest between those sought to be represented and those who filed the action, the class suit will NOT prosper (Ibañez v. Roman Catholic Church, 12 Phil. 227).

Legal capacity is a requirement in class suit:

The party bringing the class suit must have legal capacity to do so (Chinese Flour Importers Assoc. v. Price Stabilization Board, 9 Phil. 461).

Nature of taxpayers suit/derivative suit = Class suit:

A taxpayer’s suit or a stockholder’s derivative suit is in the nature of class suit, although subject to the other requisites of the corresponding governing law especially on the issue of locus standi (Regalado P.97).

Any party in interest shall have the right to intervene to protect his individual interest. (This is an instance when a person may intervene as a matter of right).

Common or general interest:

In this case, the suit is clearly one that benefits all commuters and motorists who use La Paz Road. As succinctly stated by the CA: The subject matter of the instant case, i.e., the closure and excavation of the La Paz Road, is initially shown to be of common or general interest to many persons. The records reveal that numerous individuals have filed manifestations with the lower court, conveying their intention to join private respondents in the suit and claiming that they are similarly situated with private respondents for they were also prejudiced by the acts of petitioners in closing and excavating the La Paz Road. Moreover, the individuals sought to be represented by private respondents in the suit are so numerous that it is impracticable to join them all as parties and be named individually as plaintiffs in the complaint. These individuals claim to be residents of various barangays in Biñan, Laguna and other barangays in San Pedro, Laguna. (Juana Complex I Homeowners Association, Inc., et al. vs. Fil-Estate Land, Inc., G.R. No. 152272, March 5, 2012)

3.3.5. Suits against entities without juridical personality (Section 15)

Under Section 1 of Rule 3, only natural or juridical persons or entities authorized by law may be parties in a civil action. However, an entity without juridical personality be sued as a defendant when it has entered into a transaction with the plaintiff.

Two or more persons not organized as an entity with juridical personality to enter into a transaction may be sued under the name by which they are generally or commonly known but they cannot sue under such name.

In the answer of such defendant, the names and addresses of the persons composing said entity must all be revealed (See Sec. 8, Rule 14 as to the manner of the service of summons of such entities).

With respect to judgments to be rendered in this situation, Sec. 6 of Rule 36 provides that when judgment is rendered against two or more persons associated in an entity without juridical personality, the judgment shall set out their individual or proper names if known (Regalado, 2010).

3.3.6. Effect of death of party-litigant

Whenever a party to a pending action dies AND the claim is not thereby extinguished, it shall be the duty of his counsel:

1) To inform the court within 30 days after such death of the fact thereof; and 2) To give the name and address of the deceased party’s legal representative/s. (Rule 3, Sec.16)

Failure to comply is a ground for disciplinary action:

Failure to comply by counsel shall be a ground for disciplinary action.

Duty of the counsel to inform the court applies on appeal

The duty of counsel also applies to death of a party in cases pending appeal (Riviera Filipina v. CA, G.R. No. 117355, April 5, 2002).

No summons is required in case of substitution:

No summonses are required to be served on substitute defendants. Instead, the order of substitution shall be served upon the parties substituted in the action; otherwise, the court does not acquire jurisdiction over the substitute party (Ferreria, et al. v. Vda. De Gonzales, et al., 104 Phil. 143). Proceedings conducted by the trial court after the death of the defendant, and without such substitution, are null and void (Lawas v. CA, et al., L-45809, 12 Dec. 1986)(Regalado, 2010).

Legal representatives given priority:

of the deceased, priority is given to his legal

representatives, i.e., the executor or administrator of his estate. The court may allow the substitution by the heirs instead IF there is unreasonable delay in the appointment of an executor or administrator or when the estate was extrajudicially settled (Regalado, 201).

The rule is that in the substitution

3.4. Venue

3.4.1. Venue versus Jurisdiction

“(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.” (Nocum and Philippine Daily Inquirer v. Tan, G.R. No. 145022, September 23, 2005)

3.4.2. Venue of real actions (Rule 4, Section 1)

In the proper court which has jurisdiction over the area where the real property involved or a portion thereof is situated.

Forcible entry and detainer actions shall be commenced and tried in the Municipal Trial Court of the municipality or city where the real property involved or a portion thereof is situated.

Rule in case if there are two boundaries:

If the property is located at the boundaries of two places, file the case in EITHER place at the option of the plaintiff (Regalado, 2010).

Venue in case of various real properties:

Where the subject matter of the action involves various parcels of land situated in different provinces, the venue is determined by the singularity or plurality of the transactions involving said parcels of land.

1) Where said parcels are the objects of one and the same transaction, the venue is in the court where ANY of the provinces (places) where a parcel of land is situated (El Hogar Filipino v. Seva, No. 36627, November 19, 1932).

2) If parcels of land are subject of separate and distinct transactions where there is no common venue, separate actions should be laid in the court of the province where each parcel of land is situated (Mijares, et al. v. Piccio, et al., L-10458 April 22,1957; Regalado, 2010).

Location of the property venue in real property:

According to the Rules, real actions shall be commenced and tried in the court that has jurisdiction over the area where the property is situated. In this case, all the mortgaged properties are located in the Province of Cebu. Thus, following the general rule, PAGLAUM and HealthTech should have filed their case in Cebu, and not in Makati. (Paglaum Management & Development Corp. And Health Marketing Technologies, Inc., Vs. Union Bank Of The Philippines, Notary Public John Doe, And Register Of Deeds Of Cebu City And Cebu Province, $J. King & Sons Co., Inc. Intervenor, G.R. No. 179018, June 18, 2012)

3.4.3. Venue of personal actions (Rule 4, Section 2

1) Where the plaintiff or any of the principal plaintiffs resides; 2) Where the defendant or any of the principal defendants resides; or 3) In the case of non-resident defendants, where the non-resident defendant may be found.

NOTE: All of the abovementioned venues shall be at the election of the plaintiff.

Purpose of the rules on venue in personal actions:

It is a legal truism that the rules on the venue of personal actions are fixed for the convenience of the plaintiffs and their witnesses. Equally settled, however, is the principle that choosing the venue of an action is not left to a plaintiff’s caprice; the matter is regulated by the Rules of Court.

The petitioners’ complaint for collection of sum of money against the respondents is a personal action as it primarily seeks the enforcement of a contract. The Rules give the plaintiff the option of choosing where to file his complaint. He can file it in the place (1) where he himself or any of them resides, or (2) where the defendant or any of the defendants resides or may be found. The plaintiff or the defendant must be residents of the place where the action has been instituted at the time the action is commenced. (Theodore And Nancy Ang, Represented By Eldrige Marvin B. Ceron, Vs. Spouses Alan And Em Ang, Respondents. G.R. No. 186993, August 22, 2012)

3.4.4. Venue of actions against non-residents (Rule 4, Section 3)

If the non-resident defendant CAN be found in the Philippines:

1) Personal actions shall be commenced where the plaintiff resides; or 2) Real actions shall be commenced where the property is located.

If the nonresident defendant CANNOT be found in the Philippines:

An action may be commenced only if it involves:

1) Personal status of the plaintiff: venue is where the plaintiff resides; 2) Property of the defendant located in the Philippines: venue shall be where the property or a portion thereof is situated.

When there is more than one defendant/plaintiff in the case, the residences of the principal parties should be the basis for determining the proper venue (Regalado, 2010).

Exceptions on the rules on venue:

An exception to the general rules on venue is found in civil actions for damages in case of LIBEL whether a criminal case therefor has been filed or not, as special rules of venue are provided in Art.360 of the RPC, as last amended by R.A. 4363. Said venue applies to BOTH RESIDENTS and NON-RESIDENTS, assuming that jurisdiction over the latter has been acquired (Regalado, 2010).

However, if the plaintiff does not reside in the Philippines, the complaint in such case may only be filed in the court of the place where the defendant resides. In Cohen and Cohen v. Benguet Commercial Co., Ltd., this Court held that there can be no election as to the venue of the filing of a complaint when the plaintiff has no residence in the Philippines. In such case, the complaint may only be filed in the court of the place where the defendant resides. Thus:

Section 377 provides that actions of this character "may be brought in any province where the defendant or any necessary party defendant may reside or be found, or in any province where the plaintiff or one of the plaintiffs resides, at the election of the plaintiff." The

plaintiff in this action has no residence in the Philippine Islands. Only one of the parties to the action resides here. There can be, therefore, no election by plaintiff as to the place of trial. It must be in the province where the defendant resides. x x x (Theodore And Nancy Ang, Represented By Eldrige Marvin B. Ceron, Vs. Spouses Alan And Em Ang, Respondents. G.R. No. 186993, August 22, 2012)

3.4.5. When the rules on venue do not apply (Rule 4, Section 4)

The rules on venue shall NOT apply:

1)

In those cases where a specific rule or law provides otherwise;

2)

Where the parties have validly agreed in writing before the filing of the action on the

exclusive venue thereof (Principle of Stipulations on Venue) (Sec. 4).

Requisites for venue to be exclusive:

a) There is a valid written agreement;

b) Executed by the parties before the filing of the action; and

c) Venue is of exclusive or restrictive nature (qualifying words such as only, solely,

exclusively in this court, in no other place, to the exclusion of must be used).

Requisites for venue agreement to be valid: (Rule 4, Section 4)

1)

In writing; and

2)

Executed by the parties before the filing of the action.

3.4.6. Effects of stipulations on venue

In Sps. Lantin v. Lantion, this Court explained that a venue stipulation must contain words that show exclusivity or restrictiveness, as follows:

At the outset, we must make clear that under Section 4 (b) of Rule 4 of the 1997 Rules of Civil Procedure, the general rules on venue of actions shall not apply where the parties, before the filing of the action, have validly agreed in writing on an exclusive venue. The mere stipulation on the venue of an action, however, is not enough to preclude parties from bringing a case in other venues. The parties must be able to show that such stipulation is exclusive. In the absence of qualifying or restrictive words, the stipulation should be deemed as merely an agreement on an additional forum, not as limiting venue to the specified place. x x x

Clearly, the words "exclusively" and "waiving for this purpose any other venue" are restrictive and used advisedly to meet the requirements. (Paglaum Management & Development Corp. And Health Marketing Technologies, Inc., Vs. Union Bank Of The Philippines, Notary Public John Doe, And Register Of Deeds Of Cebu City And Cebu Province, $J. King & Sons Co., Inc. Intervenor, G.R. No. 179018, June 18, 2012)

Effect of absence of exclusive words.

In the absence of qualifying or restrictive words (e.g. only, solely, exclusively in this court, in no other court save, particularly, nowhere else but/except) venue stipulation is merely

permissive and not exclusive which means that the stipulated venue is in addition to the venue provided for in the rules (Polytrade Corp. v. Blanco, G.R. No. L-27033, 1969).

Effect if the stipulation is contrary to public policy:

When the stipulation as to venue in a passenger ticket of a vessel would be contrary to public policy of making courts accessible to all who may have need of their service, the stipulation is void and unenforceable (Sweet Lines v. Teves, G.R. No. 28324, May19, 1972).

Venue based on tortuous acts

When the action is no longer based on the agreement but ON THE TORTIOUS ACT of sending collection telegrams despite the fact that the obligation had already been paid, venue is no longer based on the written stipulation but at the ELECTION OF THE PLAINTIFF as fixed by law (Herrera, 2007 Vol.1, p. 636).

Rule on change of venue:

The Supreme Court, to avoid miscarriage of justice, has the power to order a change of venue or place of the trial in civil or criminal cases or other judicial proceedings (Sec. 5 [4], Art. VIII, 1987 Constitution).

Nature of Intervention must yield to the venue in the main action:

An intervention cannot alter the nature of the action and the issues joined by the original parties thereto. (Claridades v. Mercader, G.R. No. L-20341, May 14, 1966) An intervention is not an independent proceeding but one which is merely ancillary to the existing action.

Third party complaint must yield to the venue in the main action

It has to be remembered that a third-party complaint is but ancillary to the main action and is a procedural device to avoid multiplicity of suits. Thus, a third-party complaint has to yield to the jurisdiction and venue of the main action. (Eastern Assurance & Surety Corp. v. Cui, G.R. No. L-54452, July 20 1981)

3.5. Pleadings

These are written statements of the respective claims and defenses of the parties submitted to the court for appropriate judgment (Rule 6, Sec. 1).

3.5.1. Kinds of pleadings

a) Complaint, counterclaim, cross-claim, third (fourth, etc.)-party complaint, complaint-in-intervention - The complaint is the pleading alleging the plaintiff's cause or causes of action. The names and residences of the plaintiff and defendant must be stated in the complaint. (Rule 6, Sec. 3)

b) Answer - An answer is a pleading in which a defending party sets forth his defenses. (Rule 6, Sec. 4)

Kinds of defenses:

1) Negative Defenses - The specific denial (Sec. 10, Rule 9) of the material fact/s alleged in the pleading of the claimant essential to his cause/s of action. (Sec. 5[a])

Kinds of denial:

1) Absolute denial - the defendant must specify each material allegation of fact the truth of which he does not admit and setting forth the substance of the matters upon which he relies to support his denial, whenever practicable.

2) Partial denial - the defendant shall specify so much of it as is true and material and shall deny the remainder.

3) Disavowal of knowledge - the defendant shall state in his pleading that he does not have knowledge or information sufficient to form a belief as to the truth of a material averment.

The defendant must positively state how it is that he is ignorant of the facts as alleged.

This denial does not apply where the facts as to which want of knowledge is asserted, is so plainly and necessarily within the defendant’s knowledge, that his averment of ignorance must be palpably untrue. It is as if that no denial at all has been made.

Negative Pregnant a form of negative expression which carries with it an affirmation or at least an implication of some kind favorable to the adverse party. It is a denial pregnant with an admission of the substantial facts alleged in the pleading.

Where a fact is alleged with qualifying or modifying language and the words of the allegation are so qualified or modified are literally denied, has been held that the qualifying circumstances alone are denied while the fact itself is admitted (Republic vs. Sandiganbayan, G.R. No. 152154, July 15, 2003).

Example: In Republic vs. Sandiganbayan, it was alleged that it was clearly and overwhelmingly showed how the respondents stashed away the country’s wealth to Switzerland amounting to $356M and hid the same under layers of foundations and corporate entities to prevent detection.

Negative Pregnant: The respondents specifically denies the allegations for it was false, the truth being that respondent’s properties in the bank were lawfully acquired. Thus, it was implied that they admit that it was stashed to Switzerland.

Affirmative Defenses - an allegation of a new matter which while hypothetically admitting the material allegations in the pleading of the claimant, would nevertheless prevent or bar recovery by him.

Kinds of affirmative defenses:

Affirmative defenses include fraud, statute of limitations, release, payment, illegality, statute of frauds, estoppel, former recovery, discharge in bankruptcy and any other matter by way of confession and avoidance. (Sec. 5[b])

Counterclaim It is any claim which a defending party may have against an opposing party (Rule 6, Sec. 6). Nature of a counterclaim

A counterclaim is in the nature of a cross complaint such that it must be answered

within 10 days from service. It is a cause of action against plaintiff.

Counterclaim must be within the jurisdiction of the court

Where to file: A counterclaim which is filed before the MTC must be within the jurisdiction of said court as to the amount and the nature thereof.

A court (if MTC) has no jurisdiction to hear and determine a set-off or counterclaim in

excess of its jurisdiction. A counterclaim beyond the court’s jurisdiction may only be pleaded by way of defense, the purpose of which is to defeat or weaken the plaintiff’s claim, but NOT to obtain affirmative relief.

Counterclaim cannot exceed the jurisdiction of the court

MOREOVER, the amount of judgment obtained by the defendant on appeal cannot exceed the jurisdiction of the court in which the action began. Since the trial court did not acquire jurisdiction over the counterclaim in excess of the jurisdictional amount, the appellate court likewise did not have jurisdiction over the same. In such a case, the award in excess of the jurisdiction of the trial court is void (Agustin v. Bacalan, L-16000 March 18, 1985).

Effect if counterclaim in excess of the jurisdiction of the court

A counterclaim, even if otherwise compulsory, but the amount exceeds the jurisdiction

of the inferior court, will only be considered permissive. Hence, the fact that it is not set-up in the inferior court will not bar plaintiff from instituting a separate action to prosecute it (Calo v. Ajax, L-20865, March 13, 1968).

Counterclaim in the RTC no limit: Requirement

A counterclaim may be entertained by the RTC regardless of the amount involved

provided that, in addition to the other requirements, it is cognizable by the regular courts of justice (Regalado, 2010).

(i) Compulsory Counterclaim (Sec. 7)

Requisites:

1) It must arise out of, or be necessarily connected with the transaction or occurrence that is the subject matter of the opposing party’s claim; 2) It does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction; and 3) It must be cognizable by the regular courts. 4) The trial court has jurisdiction to entertain the claim both as to the amount and the nature thereof, EXCEPT that in an original action before the RTC, the counterclaim may be considered compulsory regardless of the amount.

5)

It must be existing at the time the defendant files his answer (Sec. 8, Rule 11).

Test of Compulsoriness:

The logical relationship between the claim and counterclaim.

(ii) Permissive Counterclaim

It is a counterclaim which does not arise out of or is necessarily connected with the subject matter of the opposing party’s claim. It is not barred even of it is not set up in the original action.

Effect if counterclaim counterclaim is not raised:

General rule:

A compulsory counterclaim not set up in the answer is deemed barred.

Exceptions:

a) If it is a counterclaim which either matured or was acquired by a party after serving

his answer. In this case, it may be pleaded by filing a supplemental answer or pleading before judgment.

b) When a pleader fails to set-up a counterclaim through oversight, inadvertence, excusable negligence, or when justice requires, he may, by leave of court, set-up the counterclaim by amendment of the pleadings before judgment (Sec. 10, Rule 11).

Effect if compulsory counterclaim is not answered

A plaintiff who fails or chooses not to answer a compulsory counterclaim may not be

declared in default principally because the issues raised in the counterclaim are deemed automatically joined by the allegations of the complaint (Gojo v. Goyala, G.R. No. 26768, Oct. 30, 1970).

Motion to dismiss with compulsory counterclaim is incompatible

The filing of a motion to dismiss and the setting up of a compulsory counterclaim are incompatible remedies. In the event that a defending party has a ground for dismissal and a compulsory counterclaim at the same time, he must choose only one remedy. If he decides to file a motion to dismiss, he cannot set up his counterclaim. But if he opts to set up his counterclaim, he may still plead his ground for dismissal as an affirmative defense in his answer (Regalado, 2010).

(iii) Effect on the counterclaim when the complaint is dismissed

Under the 1997 Rules, the dismissal of the main complaint will not correspondingly result in the dismissal of the counterclaim where the defendant had already filed and served the answer with counterclaims upon the plaintiff. The defendant has the option of prosecuting the counterclaim in the same or in a separate action (Riguera, Primer Reviewer on Remedial Law).

1) If no motion to dismiss has been filed, any of the grounds for dismissal provided for in this Rule (Rule 16) may be pleaded as an affirmative defense in the answer and, in the discretion of the court, a preliminary hearing may be had thereon as if a motion to dismiss had been filed.

The dismissal of the complaint under this section shall be without prejudice to the prosecution in the same or separate action of a counterclaim pleaded in the answer (Sec. 6, Rule 16).

2) Where the plaintiff himself files a motion to dismiss his complaint after the defendant has pleaded his answer with a counterclaim, the dismissal shall be limited to the complaint and is without prejudice to the right of the defendant to prosecute his counterclaim in a separate action unless within 15 days from notice of the motion he manifests his preference to have his counterclaim resolved in the same action (Sec. 2, Rule 17).

3) If the dismissal is due to the fault of the plaintiff and a counterclaim has been set up by the defendant, the latter may prosecute such counterclaim in the same or in a separate action (Sec. 3, Rule 17; Riano).

Cross-Claims

It 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 (Rule 6 Sec. 8).

The dismissal of the complaint carries with it the dismissal of a cross-claim which is purely defensive (but NOT a cross-claim seeking affirmative relief)

Reason: It has no independent existence and based entirely on the complaint.

Third (fourth, etc.) party complaints

It is a claim that a defending party may, with leave of court, file against a person not a party to the action, called the third (fourth, etc.)-party defendant for:

a. contribution,

b. indemnity,

c. subrogation or

d. any other relief in respect to his opponent’s claim (Rule 6, Sec. 11).

Application of third- party complaint

Explaining the application of Section 12, Rule 6, supra, the Court said in Balbastro v. Court of Appeals, to wit: Section 12 of Rule 6 of the Revised Rules of Court authorizes a

defendant to bring into a lawsuit any person "not a party to the action

indemnity, subrogation or any other relief in respect of his opponent's claim." From its explicit language it does not compel the defendant to bring the third-parties into the litigation, rather it simply permits the inclusion of anyone who meets the standard set forth in the rule. The secondary or derivative liability of the third-party is central whether the basis is indemnity, subrogation, contribution, express or implied warranty or some other theory. The impleader of

new parties under this rule is proper only when a right to relief exists under the applicable

for contribution,

substantive law. This rule is merely a procedural mechanism, and cannot be utilized unless there is some substantive basis under applicable law. Apart from the requirement that the third-party complainant should assert a derivative or secondary claim for relief from the third-party defendant there are other limitations on said party’s ability to implead. The rule requires that the third-party defendant is "not a party to the action" for otherwise the proper procedure for asserting a claim against one who is already a party to the suit is by means of counterclaim or cross-claim under sections 6 and 7 of Rule 6. In addition to the aforecited requirement, the claim against the third-party defendant must be based upon plaintiff's claim against the original defendant (third-party claimant). The crucial characteristic of a claim under section 12 of Rule 6, is that the original "defendant is attempting to transfer to the third-party defendant the liability asserted against him by the original plaintiff. (Philtranco Service Enterprises, Inc., Vs. Felix Paras And Inland Trailways, Inc., And Hon. Court Of Appeals, G.R. No. 161909, April 25, 2012)

Third-party complaint: Requisites

Accordingly, the requisites for a third-party action are, firstly, that the party to be impleaded must not yet be a party to the action; secondly, that the claim against the third- party defendant must belong to the original defendant; thirdly, the claim of the original defendant against the third-party defendant must be based upon the plaintiff’s claim against the original defendant; and, fourthly, the defendant is attempting to transfer to the third-party defendant the liability asserted against him by the original plaintiff.

As the foregoing indicates, the claim that the third-party complaint asserts against the third-party defendant must be predicated on substantive law. (Philtranco Service Enterprises, Inc., Vs. Felix Paras And Inland Trailways, Inc., And Hon. Court Of Appeals, G.R. No. 161909, April 25, 2012)

Third-party complaint need not be based on same claim

The third-party claim need not be based on the same theory as the main claim. For example, there are cases in which the third-party claim is based on an express indemnity contract and the original complaint is framed in terms of negligence. Similarly, there need not be any legal relationship between the third-party defendant and any of the other parties to the action. Impleader also is proper even though the third party’s liability is contingent, and technically does not come into existence until the original defendant’s liability has been established. In addition, the words ‘is or may be liable’ in Rule 14(a) make it clear that impleader is proper even though the third-party defendant’s liability is not automatically established once the third-party plaintiff’s liability to the original plaintiff has been determined. (Philtranco Service Enterprises, Inc., Vs. Felix Paras And Inland Trailways, Inc., And Hon. Court Of Appeals, G.R. No. 161909, April 25, 2012)

Complaint in Intervention

A pleading wherein an intervenor asserts a claim against either or all of the original parties (Rule 19, Sec. 3).

Reply

A reply is a pleading, the office or function of which is to deny, or allege facts in denial

or avoidance of new matters alleged by way of defense in the answer and thereby join or make issue as to such new matters. If a party does not file such reply, all the new matters alleged in the answer are deemed controverted. (Rule 6, Sec. 10).

3.5.2. Pleadings and motions not allowed in small claim cases and cases covered by the Rules on Summary Procedure

SMALL CLAIM:

Pleadings allowed:

1. Verified Statement of Claims 2) Verified response 3) Compulsory counterclaim 4) Permissive counterclaim

Prohibited pleadings/ motions (Sec. 14 A.M. No. 08-8-7-SC, as amended)

a. Motion to dismiss the complaint;

b. Motion for a bill of particulars;

c. Motion for new trial, or for reconsideration of a judgment, or for reopening of trial;

d. Petition for relief from judgment;

e. Motion for extension of time to file pleadings, affidavits, or any other paper;

f. Memoranda;

g. Petition for certiorari, mandamus, or prohibition against any interlocutory order issued by the court;

h. Motion to declare the defendant in default;

i. Dilatory motions for postponement;

j. Reply;

k. Third-party complaints; and

l. Interventions

Jurisdictional amount

The rule shall govern the procedure before the MTC in actions for payment of money where the value of the claim does not exceed P100,000, exclusive of interests and costs.

The prohibited pleadings and motions are essentially the same as those prohibited under the Rule on Summary Procedure. The only difference is that motions to dismiss on whatever ground are prohibited in small claims cases.

SUMMARY PROCEDURE

Pleadings allowed under the Rule on Summary Procedure:

a. Complaint

b. Compulsory Counterclaim

c. Cross-claim

All pleadings must be verified.

Prohibited pleadings/ motions

1. Motion to dismiss the complaint EXCEPT on the ground of lack of jurisdiction over the subject matter, or failure to comply with the requirement of prior referral to the Lupon;

2. Motion for bill of particulars;

3. Motion for new trial or for reconsideration of a judgment or for reopening of trial;

4. Petition for relief from judgment;

5. Motion for extension of time to file pleadings, affidavits or any other papers;

6. Memoranda;

7. Petition for certiorari, mandamus, or prohibition against any interlocutory order issued by the court;

8. Motion to declare the defendant in default;

9. Dilatory motions for postponement;

10. Reply;

11. Third party complaint;

12. Intervention.

Note: The filing of a motion to dismiss after the answer had already been submitted does not constitute prohibited pleading (Heirs of Olivas v. Flor, L-78343 May 21, 1988).

Lack of jurisdiction may be raised in a motion to dismiss

The defense of lack of jurisdiction may be raised in a motion to dismiss as an exception to the rule on prohibited pleadings.

Motion to render judgment

While the plaintiff cannot file a motion to declare defendant in default, he may still file a motion to render judgment should the defendant fail to file his answer.

3.5.3. Parts of a pleading

a) Caption

The caption sets forth the name of the court, the title of the action, and the docket number if assigned.

The title of the action indicates the names of the parties. They shall all be named in the original complaint or petition; but in subsequent pleadings, it shall be sufficient if the name of the first party on each side be stated with an appropriate indication when there are other parties.

Their respective participation in the case shall be indicated. (Rule 7, Sec.1)

b) Signature and address

Every pleading must be signed by the party or counsel representing him, stating in either case his address which should not be a post office box.

The signature of counsel constitutes a certificate by him that he has read the pleading; that to the best of his knowledge, information, and belief there is good ground to support it; and that it is not interposed for delay.

An unsigned pleading produces no legal effect. However, the court may, in its discretion, allow such deficiency to be remedied if it shall appear that the same was due to mere inadvertence and not intended for delay. Counsel who deliberately files an unsigned pleading, or signs a pleading in violation of this Rule, or alleges scandalous or indecent matter therein, or fails promptly report to the court a change of his address, shall be subject to appropriate disciplinary action. (Rule 7, Sec.3)

c) Verification

Rule 7, Section 4. Verification. Except when otherwise specifically required by law or rule, pleadings need not be under oath, verified or accompanied by affidavit .(5a)

A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein are true and correct of his knowledge and belief.

A pleading required to be verified which contains a verification based on "information and belief", or upon "knowledge, information and belief", or lacks a proper verification, shall be treated as an unsigned pleading.

Importance of verification

The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. Verification is deemed substantially complied with when, as in this case, one who has ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, and when matters alleged in the petition have been made in good faith or are true and correct. (Felix Martos, Jimmy Eclana, Rodel Pilones, et al. Vs. New San Jose Builders, Inc., G.R. No. 192650. October 24,

d) Certification against forum shopping

Rule 7, Section 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.

Effects of failure to comply

Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The

submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions.

Requirements of a corporation executing the verification/certification of non-forum shopping

The requirement that a petitioner or principal party should sign the certificate of non- forum shopping applies even to corporations, considering that the mandatory directives of the Rules of Court make no distinction between natural and juridical persons.

A corporation, however, exercises its powers through its board of directors and/or its duly authorized officers and agents. Physical acts, like the signing of documents, can be performed only by natural persons duly authorized for the purpose by corporate by-laws or by a specific act of the board of directors (Pascual and Santos, Inc. v. The Members of the Tramo Wakas Neighborhood Association, Inc., G.R. No. 144880, November 17, 2004).

Purpose of Certification against Forum Shopping

We emphasize that the rules on forum shopping are meant to prevent such eventualities as conflicting final decisions. This Court has consistently held that the costly consequence of forum shopping should remind the parties to ever be mindful against abusing court processes. In addition, the principle of res judicata requires that stability be accorded to judgments. Controversies once decided on the merits shall remain in repose for there should be an end to litigation which, without the doctrine, would be endless. (Elsa D. Medado vs. Heirs of the Late Antonio Consing, G.R. No. 186720, February 8, 2012)

e) Effect of the signature of counsel in a pleading

The signature of counsel constitutes a certificate by him that he has read the pleading; that to the best of his knowledge, information, and belief there is good ground to support it; and that it is not interposed for delay.

An unsigned pleading produces no legal effect. However, the court may, in its discretion, allow such deficiency to be remedied if it shall appear that the same was due to mere inadvertence and not intended for delay. Counsel who deliberately files an unsigned pleading, or signs a pleading in violation of this Rule, or alleges scandalous or indecent matter therein, or fails promptly report to the court a change of his address, shall be subject to appropriate disciplinary action. (Rule 7, Sec.3)

Effect of signing by a person not authorized to sign

What then, is the effect of a complaint filed by one who has not proven his authority to represent a plaintiff in filing an action? In Tamondong v. Court of Appeals, the Court categorically stated that “[i]f a complaint is filed for and in behalf of the plaintiff [by one] who is not authorized to do so, the complaint is not deemed filed. An unauthorized complaint does not produce any legal effect. Hence, the court should dismiss the complaint on the ground that it has no jurisdiction over the complaint and the plaintiff.” This ruling was reiterated in Cosco Philippines Shipping, Inc. v. Kemper Insurance Company, where the Court went on to say that “[i]n order for the court to have authority to dispose of the case on the merits, it must acquire

jurisdiction over the subject matter and the parties. Courts acquire jurisdiction over the plaintiffs upon the filing of the complaint, and to be bound by a decision, a party should first be subjected to the court's jurisdiction. Clearly, since no valid complaint was ever filed with the [MeTC], the same did not acquire jurisdiction over the person of respondent [plaintiff before the lower court]." Pursuant to the foregoing rulings, therefore, the MeTC never acquired jurisdiction over this case and all proceedings before it were null and void. The courts could not have delved into the very merits of the case, because legally, there was no complaint to speak of. The court's jurisdiction cannot be deemed to have been invoked at all. (Atty. Fe Q. Palmiano-Salvador Vs. Constantino Angeles, Substituted By Luz G. Angeles, G.R. No. 171219, September 3 2012)

Substantial compliance in verification

1. When the party who signed the verification has sufficient knowledge of its contents

Verification is deemed substantially complied with when, as in the instant case, one who has ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, and when matters alleged in the petition have been made in good faith or are true and correct. (Georgia T. Estel, vs. Recaredo P. Diego, Sr. and Recaredo R. Diego, Jr., G.R. No. 174082, January 16, 2012)

When the party who signed is covered by a valid authorization?

[R]ecords show that Soledad signed the verification and certification against forum shopping on behalf of her co-petitioners by virtue of a Special Power of Attorney (SPA) attached to the petition filed with the CA.

[T]he authority of Soledad includes the filing of an appeal before the CA, including the execution of a verification and certification against forum shopping therefor, being acts necessary "to protect, sue, prosecute, defend and adopt whatever action necessary and proper" in relation to their rights over the subject properties.

In addition, the allegations and contentions embodied in the CA petition do not deviate from the claims already made by the heirs in Civil Case Nos. 00-11320 and 797-C, both specifically mentioned in the SPA. We emphasize that the verification requirement is simply intended to secure an assurance that the allegations in the pleading are true and correct, and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. We rule that there was no deficiency in the petition's verification and certification against forum shopping filed with the CA.

In any case, we reiterate that where the petitioners are immediate relatives, who share a common interest in the property subject of the action, the fact that only one of the petitioners executed the verification or certification of forum shopping will not deter the court from proceeding with the action. (Elsa D. Medado vs. Heirs of the Late Antonio Consing, G.R. No. 186720, February 8, 2012)

When only a part of the undertaking is missing

As to respondents' certification on non-forum shopping, a reading of respondents’ certification/Certification reveals that they, in fact, certified therein that they have not

commenced any similar action before any other court or tribunal and to the best of their knowledge no such other action is pending therein. The only missing statement is respondents' undertaking that if they should thereafter learn that the same or similar action has been filed or is pending, they shall report such fact to the court. This, notwithstanding, the Court finds that there has been substantial compliance on the part of respondents. (Georgia T. Estel, vs. Recaredo P. Diego, Sr. and Recaredo R. Diego, Jr., G.R. No. 174082, January 16, 2012)

It may be availed of with respect to the contents of the certification

The rule of substantial compliance may be availed of with respect to the contents of the certification. This is because the requirement of strict compliance with the provisions regarding the certification of non-forum shopping merely underscores its mandatory nature in that the certification cannot be altogether dispensed with or its requirements completely disregarded. Thus, under justifiable circumstances, the Court has relaxed the rule requiring the submission of such certification considering that although it is obligatory, it is not jurisdictional.

Certificate of Non-forum shopping required in Petition for Certiorari

The Rules of Court provide that a petition for certiorari must be verified and accompanied by a sworn certification of non-forum shopping. Failure to comply with these mandatory requirements shall be sufficient ground for the dismissal of the petition. Considering that only 3 of the 228 named petitioners signed the requirement, the CA dismissed the case against them, as they did not execute a Verification and Certification against forum shopping. (Vivian T. Ramirez Et. Al., vs. Mar Fishing Co., Inc., Miramar Fishing Co., Inc., Robert Buehs And Jerome Spitz, G.R. No. 168208, June 13, 2012)

3.5.4. Allegations in a pleading

Manner of Making Allegations

In General (Rule 8, Sec.1)

Every pleading shall contain in a methodical and logical form a plain, concise and direct statement of the ultimate facts, omitting the statement of mere evidentiary facts.

Only ultimate facts must be alleged

Ultimate Facts are those important and substantial facts which form the basis of the primary right of the plaintiff and which make up the wrongful acts or omissions of the defendant. They are the principal, determinate, constitutive facts, upon the existence of which, the entire cause of action rests (Tantuico, Jr. v. Republic, G.R. No. 89114, December 2, 1991).

Legal conclusions or evidentiary facts need not be alleged

Only ultimate facts and not legal conclusions or evidentiary facts, which should not be alleged in the complaint in the first place, are considered for purposes of applying the test. (D.M. Ferrer & Associates Corporation vs. University Of Santo Tomas, G.R. No. 189496, February 1, 2012)

Alternative Causes of Action (Rule 8, Sec.2)

A party may set forth 2 or more statements of a claim or defense alternatively or hypothetically, EITHER in one cause of action or defense or in separate causes of action or defense.

Condition precedent (Rule 8, Sec.3)

A general averment of performance of all conditions precedent shall be sufficient. If condition precedent is required, the complaint must allege fulfillment or excuse for non- fulfillment.

Fraud, mistake, malice, intent, knowledge and other condition of the mind, judgments, official documents or acts

Fraud, mistake, condition of mind

Rule 8, Section 5. Fraud, mistake, condition of the mind. In all averments of fraud or mistake the circumstances constituting fraud or mistake must be stated with particularity. Malice, intent, knowledge, or other condition of the mind of a person may be averred generally.

Judgment:

Rule 8, Section 6. Judgment. In pleading a judgment or decision of a domestic or foreign court, judicial or quasi-judicial tribunal, or of a board or officer, it is sufficient to aver the judgment or decision without setting forth matter showing jurisdiction to render it.

Rule 8, Section 9. Official document or act. In pleading an official document or official act, it is sufficient to aver that the document was issued or the act done in compliance with law.

Pleading an actionable document

Rule 8, Section 7. Action or defense based on document. Whenever an action or defense is based upon a written instrument or document, the substance of such instrument or document shall be set forth in the pleading, and the original or a copy thereof shall be attached to the pleading as an exhibit, which shall be deemed to be a part of the pleading, or said copy may with like effect be set forth in the pleading.

c) Specific Denials

Rule 8, Section 10. Specific denial. A defendant must specify each material allegation of fact the truth of which he does not admit and, whenever practicable, shall set forth the substance of the matters upon which he relies to support his denial. Where a defendant desires to deny only a part of an averment, he shall specify so much of it as is true and material and shall deny only the remainder. Where a defendant is without knowledge or information sufficient to form a belief as to the truth of a material averment made to the complaint, he shall so state, and this shall have the effect of a denial.

Effect of Failure to make specific denials

The genuineness and due execution of the instrument shall be deemed admitted unless the adverse party, under oath specifically denies them, and sets forth what he claims to be the

facts, but the requirement of an oath does not apply when the adverse party does not appear to be a party to the instrument or when compliance with an order for an inspection of the original instrument is refused. (Rule 8, Section 8)

(ii). When a specific denial requires an oath: Exception

The genuineness and due execution of the instrument shall be deemed admitted unless the adverse party, under oath specifically denies them, and sets forth what he claims to be the facts, but the requirement of an oath does not apply

a) when the adverse party does not appear to be a party to the instrument; or

b) When compliance with an order for an inspection of the original instrument is refused. (Rule 8, Section 8)

3.5.5. Effect of Failure to Plead

a) Failure to plead defenses and objections

General rule:

Defenses and objections not pleaded in an answer or motion to dismiss are deemed waived. (Rule 9, Section 1)

Exceptions:

When it appears from the pleadings or evidence on record

1)

That the court lack jurisdiction over the subject matter;

2)

Litis pendentia between same parties for the same cause;

3) Res judicata;

4) Action barred by statute of limitations.

The court shall dismiss the claim.

NOTE: These defenses may be raised at any stage of the proceedings, even on appeal, except lack of jurisdiction which may be barred by laches (Tijam v. Sibonghanoy, G.R. No. L-21450, April 15, 1968).

Failure to plead compulsory counterclaim or cross-claim

General rule:

A compulsory counterclaim or cross-claim which is not set up is deemed barred. (Rule 9,

Sec. 2)

Exception:

If the counterclaim or cross claim matured or was acquired by a party after serving his

answer, he may, with the permission of the court, be allowed to present his counterclaim or

The filing of a motion to dismiss and the setting up of a compulsory counterclaim are incompatible remedies. If he decides to file a motion to dismiss, he will lose his compulsory counterclaim. But if he opts to set up his compulsory counterclaim, he may still plead his ground for dismissal as an affirmative defense in his answer. (Finacial Building Corp. v. Forbes Park PARK Association, G.R. No. 133119, Aug. 17, 2000)

When a pleader fails to set up a counterclaim or a cross-claim through oversight, inadvertence, or excusable neglect, or when justice requires, he may, by leave of court, set up the counterclaim or cross-claim by amendment before judgment. (Sec. 10, Rule 11).

NOTE: An after-acquired counterclaim is merely permissive even if it arises from or is connected with the transaction or occurrence constituting the subject-matter of the opposing party’s claim.

3.5.6. Default

When a declaration of default is proper?

If the defending party fails to answer within the time allowed therefor, the court shall, upon motion of the claiming party with notice to the defending party, and proof of such failure, declare the defending party in default. Thereupon, the court shall proceed to render judgment granting the claimant such relief as his pleading may warrant, unless the court in its discretion requires the claimant to submit evidence. Such reception of evidence may be delegated to the clerk of court. (Rule 9, Sec. 3)

Failure to file an Answer-in-intervention; Default

Lim points out that an answer-in-intervention cannot give rise to default since the filing of such an answer is only permissive. But Section 4, Rule 19 of the 1997 Rules of Civil Procedure requires the original parties to file an answer to the complaint-in-intervention within 15 days from notice of the order admitting the same, unless a different period is fixed by the court. This changes the procedure under the former rule where such an answer was regarded as optional. Thus, Lim’s failure to file the required answer can give rise to default. Natividad Lim Vs. National Power Corporation, Sps. Roberto Ll. Arcinue and Arabela Arcinue, G.R. No. 178789. November 14, 2012)

Effect of an order of default

A party in default shall be entitled to notice of subsequent proceedings but not to take part in the trial. (Rule 9, Sec. 3(a)) The petitioners’ default by their failure to file their answer led to certain consequences. Where defendants before a trial court are declared in default, they thereby lose their right to object to the reception of the plaintiff’s evidence establishing his cause of action. This is akin to a failure to, despite due notice, attend in court hearings for the presentation of the complainant’s evidence, which absence would amount to the waiver of such defendant’s right to object to the evidence presented during such hearing, and to cross-examine the witnesses presented therein.(Magdiwang Realty Corporation, Renato P. Dragon And Esperanza Tolentino Vs. The Manila Banking Corporation, Substituted By First Sovereign Asset Management (Spv- Amc), Inc., G .R. No. 195592, 5 Sep 2012)

Relief from an order of default

A party declared in default may at any time after notice thereof and before judgment file a motion under oath to set aside the order of default upon proper showing that his failure to answer was due to fraud, accident, mistake or excusable negligence and that he has a meritorious defense. In such case, the order of default may be set aside on such terms and conditions as the judge may impose in the interest of justice. (Rule 9, Sec. 3(b)) The records reveal that the judgment of default was sent via registered mail to PTA’s counsel. However, PTA never availed of the remedy of a motion to lift the order of default. Since the failure of PTA to present its evidence was not a product of any fraudulent acts committed outside trial, the RTC did not err in declaring PTA in default. (Philippine Tourism Authority, Vs. Philippine Golf Development & Equipment, Inc., G.R. No. 176628, G.R. No. 176628 March 19,

2012)

Effect of a partial default

When a pleading asserting a claim states a common cause of action against several defending parties, some of whom answer and the others fail to do so, the court shall try the case against all upon the answers thus filed and render judgment upon the evidence presented. (Rule 9, Sec. 3(c))

Extent of relief

A judgment rendered against a party in default shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages. (Rule 9, Sec. 3(d))

Notably, the Rules is even more strict in safeguarding the right to due process of a defendant who was declared in default than of a defendant who participated in trial. For instance, amendment to conform to the evidence presented during trial is allowed the parties under the Rules. But the same is not feasible when the defendant is declared in default because Section 3(d), Rule 9 of the Rules of Court comes into play and limits the relief that may be granted by the courts to what has been prayed for in the Complaint. It provides:

(d) Extent of relief to be awarded. A judgment rendered against a party in default shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages.

Rationale for limiting the extent of relief

The raison d’être in limiting the extent of relief that may be granted is that it cannot be presumed that the defendant would not file an Answer and allow himself to be declared in default had he known that the plaintiff will be accorded a relief greater than or different in kind from that sought in the Complaint. No doubt, the reason behind Section 3(d), Rule 9 of the Rules of Court is to safeguard defendant’s right to due process against unforeseen and arbitrarily issued judgment. This, to the mind of this Court, is akin to the very essence of due process. It embodies “the sporting idea of fair play”39 and forbids the grant of relief on matters where the defendant was not given the opportunity to be heard thereon. (Leticia Diona, rep. by her attorney-in-fact, Marcelina Diona Vs. Romeo A. Balangue, Sonny A. Balangue, Reynaldo A. Balangue, and Esteban A. Balangue, Jr. G.R. No. 173559. January 7, 2013)

Actions where default is not allowed

If the defending party in an action for annulment or declaration of nullity of marriage or for legal separation fails to answer, the court shall order the prosecuting attorney to investigate whether or not a collusion between the parties exists, and if there is no collusion, to intervene for the State in order to see to it that the evidence submitted is not fabricated. (Rule 9, Sec.

3(e))

Filing a motion to dismiss stall the running of the period within which a party must answer, hence no default shall lie within the suspended period

As a consequence of the motion to dismiss that defendant Narciso filed, the running of the period during which the rules required her to file her answer was deemed suspended. When the trial court denied her motion to dismiss, therefore, she had the balance of her period for filing an answer under Section 4, Rule 16 within which to file the same but in no case less than five days, computed from her receipt of the notice of denial of her motion to dismiss. Thus:

SEC. 4. Time to plead. If the motion is denied, the movant shall file his answer within the balance of the period prescribed by Rule 11 to which he was entitled at the time of serving his motion, but not less than five (5) days in any event, computed from his receipt of the notice of the denial. If the pleading is ordered to be amended, he shall file his answer within the period prescribed by Rule 11 counted from service of the amended pleading, unless the court provides a longer period.

But apart from opposing defendant’s motion to dismiss, plaintiff Garcia asked the trial court to declare Narciso in default for not filing an answer, altogether disregarding the suspension of the running of the period for filing such an answer during the pendency of the motion to dismiss that she filed in the case. Consequently, when the trial court granted Garcia’s prayer and simultaneously denied Narciso’s motion to dismiss and declared her in default, it committed serious error. Narciso was not yet in default when the trial court denied her motion to dismiss. She still had at least five days within which to file her answer to the complaint.

What is more, Narciso had the right to file a motion for reconsideration of the trial court’s order denying her motion to dismiss. No rule prohibits the filing of such a motion for reconsideration. Only after the trial court shall have denied it does Narciso become bound to file her answer to Garcia’s complaint. And only if she did not do so was Garcia entitled to have her declared in default. Unfortunately, the CA failed to see this point. (Anita A. Ledda Vs. Bank of the Philippine Islands, G.R. No. 200868. November 21, 2012)

3.5.7. Filing and service of pleadings

a) Payment of Docket Fees

Docket fees MUST be paid at the commencement of the action

1) A court acquires jurisdiction over any case only upon the payment of the prescribed docket fee, and in order to curb the unethical practice of misleading the docket clerk in the assessment of the correct filing fee, the SC laid down the rule that “henceforth all complaints, petitions, answers and other similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer therein, and said damages shall be the basis for assessing the amount of the filing fees.” (SC Circular No. 7, March 24, 1988; Manchester Development v. CA, No. L-75919, May 7, 1987).

2) 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 (Sun Insurance Office, Ltd., v. Asuncion, G.R. Nos. 79937-38, February 13, 1989).

3) Payment of filing fees is also required in cases of appeal (Sec. 5, Rule 40; Sec. 4, Rule 41; Sec. 3, Rule 45).

Effect of non-payment of docket fees:

Plainly, while the payment of the prescribed docket fee is a jurisdictional requirement, nonpayment of which at the time of filing does not automatically cause the dismissal of the case for as long as the fee is paid within the applicable prescriptive or reglementary period; more so when the party involved demonstrates a willingness to abide by the rules prescribing such payment. (Sps. Go v. Tong, G.R. 151942, Nov. 27, 2003)

Docket fees based on value of the stocks:

An action seeking for the execution of a deed of assignment of shares of stock is an action for recovery of personal property. The payment of docket fees should be based on the value of the shares of stock and the amount of damages he seeks to recover. (NSC v. Court of Appeals, G.R. No. 123215. February 2, 1999)

Exception: Docket fees need NOT be paid at the time of filing of the complaint and may be considered a lien on the judgment in the following instances:

1. The damages or claim arose after the filing of the complaint/initiatory pleading or if the court awards damages not prayed for in the complaint (Original Dev’t & Construction Corp. v. CA, 202 SCRA 75;, Sec.2, Rule 141);

2. Indigent litigant (Sec. 19, Rule 141);

3. Failure of the adverse party to timely raise the issue of nonpayment of the docket fee (National Steel Corp. v. CA, G.R. No. 123215, February 2, 1999);

4. Civil action instituted with the criminal action where the moral, exemplary, nominal, and temperate damages are not specified in the complaint or information (Sec. 1, Rule 141);

5. Petition for Writ of Amparo shall be exempt from the payment of docket and other filing fees (Sec. 1, Rule on the Writ of Amparo).

6. Indigent petitioner for writ of habeas data is exempt from payment of docket or other lawful fees. (Section 5, Rule on the Writ of Habeas Data A.M. No. 08-1-16 SC)

Payment of Court fees under Rule 141: Cooperatives not exempt

Since the payment of legal fees is a vital component of the rules promulgated by this Court concerning pleading, practice and procedure, it cannot be validly annulled, changed or modified by Congress. As one of the safeguards of this Court’s institutional independence, the power to promulgate rules of pleading, practice and procedure is now the Court’s exclusive domain. That power is no longer shared by this Court with Congress, much less with the Executive.

With the foregoing categorical pronouncements of the Supreme Court (Supreme Court En Banc Resolution in A.M. No. 08-2-01-0, which denied the petition of the GSIS for recognition of its exemption from payment of legal fees imposed under Section 22 of Rule 141 of the Rules of Court, 11 February 2010; Baguio Market Vendors Multi-Purpose Cooperative (BAMARVEMPCO) v. Cabato-Cortes, 26 February 2010), it is evident that the exemption of cooperatives from payment of court and sheriff’s fees no longer stands. Cooperatives can no longer invoke Republic Act No. 6938, as amended by Republic Act No. 9520, as basis for exemption from the payment of legal fees. (Re: In The Matter of Clarification of Exemption From Payment of All Court And Sheriff's Fees of Cooperatives Duly Registered in Accordance with Republic Act No. 9520 Otherwise Known as the Philippine Cooperative Code Of 2008, Perpetual Help Community Cooperative (Phcci), A.M. No. 12-2-03-0 , March 13, 2012)

Some guidelines in payment of filling fees

In Siapno (505 Phil. 430 [2005]) the complaint alleged in its body the aggregate sum of P4,500,000 in moral and exemplary damages and attorney's fees, but the prayer portion did not mention these claims, nor did it even pray for the payment of damages. This Court held that such a complaint should be dismissed outright; or if already admitted, should be expunged from the records. The Court explained that the rule requiring the amount of damages claimed to be specified not only in the body of the pleading but also in its prayer portion was intended to put an end to the then prevailing practice of lawyers where the damages prayed for were recited only in the body of the complaint, but not in the prayer, in order to evade payment of the correct filing fees. As held by the Court in Manchester:

“To put a stop to this irregularity, henceforth all complaints, petitions, answers and other similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged from the record.”

In Sun Insurance Office Ltd. v. Judge Asuncion, the Court laid down the following rules as regards the payment of filing fees:

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 [but] 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.

It cannot be gainsaid from the above guidelines that, with the exception of pauper litigants (Section 16, Rule 141 of the Rules of Court states that "the legal fees shall be a lien on the monetary or property judgment in favor of the pauper-litigant) without the payment of the correct docket or filing fees within the reglementary period, jurisdiction over the subject-matter or nature of the action will not vest in the trial court. In fact, a pauper litigant may still have to pay the docket fees later, by way of a lien on the monetary or property judgment that may accrue to him. Clearly, the flexibility or liberality of the rules sought by the petitioners cannot apply in the instant case. (Ricardo Rizal, Potenciana Rizal, Saturnina Rizal, Elena Rizal, And Benjamin Rizal, Vs. Leoncia Naredo, Anastacio Lirio, Edilberto Cantavieja, Gloria Cantavieja, Celso Cantavieja, And The Heirs Of Melanie Cantavieja, G.R. No. 151898, March 14, 2012)

b) Filing versus service of pleadings

Filing is the act of presenting the pleading or other paper to the clerk of court.

Service is the act of providing a party with a copy of the pleading or paper concerned. If any party has appeared by counsel, service upon him shall be made upon his counsel or one of them, unless service upon the party himself is ordered by the court. Where one counsel appears for several parties, he shall only be entitled to one copy of any paper served upon him by the opposite side. (Rule 13, Section 2)

c) Periods of filing of pleadings. (Rule 11)

1. Answer to complaint (Sec.1) 15 days from service, unless different period is fixed by the court 2. Answer of a defendant foreign private juridical entity (Sec.2)

TO WHOM SERVED

Resident Agent

Government official designated by law to receive summons

Officers of agents within the Philippines

PERIOD TO FILE AN ANSWER

15 days after service of summons

30 days after the receipt of summons by foreign private juridical entity

15 days after the service of summons

NOTE: A non-resident defendant on whom extraterritorial service of summons is made - the period to answer should be at least 60 days.

3) Answer to amended complaint (Sec.3)

a) As a matter of right: 15 days from being served with copy thereof b) Not as a matter of right: 10 days from notice of order admitting the same

Answer earlier filed may be answer to amended complaint, if no new answer is filed.

Applicable to amended counterclaim, cross, third, etc,

4. Answer to counterclaim or cross-claim (Sec.4) - within 10 days from service

General rule:

An answer to counterclaim or cross claim is required. Failure to answer is ground for default.

Exceptions: (in case of counterclaim)

a) Where answer would be a repetition of allegations in the complaint (Navarro v. Bello ,

L-11647 January 31, 1958);

b) Where the issues raised in the counterclaim are inseparable from those posed in the

complaint (Sarmiento v. Juan, No. 56605 January 28, 1983);

c) A plaintiff who fails or chooses not to answer a compulsory counterclaim may not be

declared in default, principally because the issues raised in the counterclaim are deemed automatically joined by the allegations in the complaint (Gojo v. Goyala, G.R. No. L-26768, 30 October 1970).

5. Answer to third (fourth, etc.)-party complaint (Sec.5) - within 15 days from service.

6. Reply (Sec.6) may be filed within 10 days from service of the pleading responded to.

7. Answer to supplemental complaint (Sec.7) - within 10 days from notice of the order admitting the same, unless a different period is fixed by the court.

NOTE: The answer to the complaint shall serve as the answer to the supplemental complaint if no new or supplemental answer is filed.

Counterclaim or cross-claim arising after answer (Sec.9)

It may, with permission of the court, be presented as such by supplemental pleading before judgment.

Omitted counterclaim or cross-claim (Sec.10)

When a pleader fails to set up a counterclaim or cross claim through oversight, inadvertence, or excusable neglect, or when justice requires, he may, by leave of court, be set up as such by amendment before judgment.

Extension of time to plead (Sec.11)

Requisites:

1. That the party files a motion for extension; 2. The terms are just; and

Service of such motion must be given to the other party.

d) Manner of filing

The filing of pleadings, appearances, motions, notices, orders, judgments and all other papers shall be made by presenting the original copies thereof, plainly indicated as such, personally to the clerk of court or by sending them by registered mail. In the first case, the clerk of court shall endorse on the pleading the date and hour of filing. In the second case, the date of the mailing of motions, pleadings, or any other papers or payments or deposits, as shown by the post office stamp on the envelope or the registry receipt, shall be considered as the date of their filing, payment, or deposit in court. The envelope shall be attached to the record of the case. (Rule 13, Sec. 3)

If a party avails the services of a private carrier, the date of actual receipt by the court of such pleading and not the date of delivery to the private carrier, is deemed to be the date of the filing of that pleading (Benguet Electric Cooperative, Inc. v. NLRC, G.R. No. 89070 May 18,

1992).

Modes of service

Service of pleadings motions, notices, orders, judgments and other papers shall be made either personally or by mail. (Rule 13, Sec. 5)

i. Personal service

Service of the papers may be made by delivering personally a copy to the party or his counsel, or by leaving it in his office with his clerk or with a person having charge thereof. If no person is found in his office, or his office is not known, or he has no office, then by leaving the copy, between the hours of eight in the morning and six in the evening, at the party's or counsel's residence, if known, with a person of sufficient age and discretion then residing therein. (Rule 13, Sec. 6)

ii. Service by mail

Service by registered mail shall be made by depositing the copy in the post office in a sealed envelope, plainly addressed to the party or his counsel at his office, if known, otherwise at his residence, if known, with postage fully prepaid, and with instructions to the postmaster to return the mail to the sender after ten (10) days if undelivered. If no registry service is available in the locality of either the senders or the addressee, service may be done by ordinary mail. (Rule 13, Sec. 7)

iii. Substituted service

If service of pleadings, motions, notices, resolutions, orders and other papers cannot be made under the two preceding sections, the office and place of residence of the party or his counsel being unknown, service may be made by delivering the copy to the clerk of court, with proof of failure of both personal service and service by mail. The service is complete at the time of such delivery. (Rule 13, Sec. 8)

Under Section 3 Rule 3 of the Rules of Procedure on Corporate Rehabilitation (2008) and Section 6 of the Interim Rules of Procedure Governing Intra-Corporate Controversies, any pleading and /or document required by the said Rules may be filed with the court and/or served upon the other parties by fax or email if so authorized by the court. In such cases, the

date of transmission shall be deemed to be prima facie the date of service. (Primer-Reviewer on Remedial Law, Vol.I, Civil Procedure, Riguera, 2 nd ed., 2013)

iv. Service of judgments, final orders or resolutions

Judgments, final orders or resolutions shall be served either personally or by registered mail. When a party summoned by publication has failed to appear in the action, judgments, final orders or resolutions against him shall be served upon him also by publication at the expense of the prevailing party. (Rule 13, Sec. 9)

v. Priorities in modes of service and filing

Whenever practicable, the service and filing of pleadings and other papers shall be done personally. Except with respect to papers emanating from the court, a resort to other modes must be accompanied by a written explanation why the service or filing was not done personally. A violation of this Rule may be cause to consider the paper as not filed. (Rule 13, Sec. 11)

vi. When service is deemed complete

Personal service is complete upon actual delivery. Service by ordinary mail is complete upon the expiration of ten (10) days after mailing, unless the court otherwise provides. Service by registered mail is complete upon actual receipt by the addressee, or after five (5) days from the date he received the first notice of the postmaster, whichever date is earlier. (Rule 13, Sec.

10)

Nature of proof of service of motions, pleadings and other papers

In Cruz v. Court of Appeals, we ruled that with respect to motions, proof of service is a mandatory requirement. We find no cogent reason why this dictum should not apply and with more reason to a petition for certiorari, in view of Section 3, Rule 46 which requires that the petition shall be filed "together with proof of service thereof." We agree with the Court of Appeals that the lack of proof of service is a fatal defect. The utter disregard of the Rule cannot be justified by harking to substantial justice and the policy of liberal construction of the Rules. Technical rules of procedure are not meant to frustrate the ends of justice. Rather, they serve to effect the proper and orderly disposition of cases and thus effectively prevent the clogging of court dockets. (Emphasis in the original)

Indeed, while an affidavit of service is required merely as proof that service has been made on the other party, it is nonetheless essential to due process and the orderly administration of justice. Salvador O. Mojar, Edgar B. Begonia, Heirs Of The Late Jose M. Cortez, Restituto Gaddi, Virgilio M. Monana, Freddie Rances, And Edson D. Tomas, Vs. Agro Commercial Security Service Agency, Inc., Et Al., G.R. No. 187188, June 27, 2012)

Service to persons represented by counsel

Such service to Atty. Espinas, as petitioners’ counsel of record, was valid despite the fact he was already deceased at the time. If a party to a case has appeared by counsel, service of pleadings and judgments shall be made upon his counsel or one of them, unless service upon the party is specifically ordered by the court. It is not the duty of the courts to inquire, during the progress of a case, whether the law firm or partnership representing one of the litigants

continues to exist lawfully, whether the partners are still alive, or whether its associates are still connected with the firm. (Salvador O. Mojar, Edgar B. Begonia, Heirs Of The Late Jose M. Cortez, Restituto Gaddi, Virgilio M. Monana, Freddie Rances, And Edson D. Tomas, Vs. Agro Commercial Security Service Agency, Inc., Et Al., G.R. No. 187188, June 27, 2012)

3.5.8. Amendment

How to amend a pleading?

Pleadings may be amended by adding or striking out an allegation or the name of any party, or by correcting a mistake in the name of a party or a mistaken or inadequate allegation or description in any other respect, so that the actual merits of the controversy may speedily be determined, without regard to technicalities, and in the most expeditious and inexpensive manner. (Rule 10, Section 1)

a) Amendment as a matter of right

A party may amend his pleading once as a matter of right at any time before a responsive pleading is served or, in the case of a reply, at any time within ten (10) days after it is served. (Rule 10, Section 2)

Amendment as a matter o right though there is a motion to dismiss

A motion to dismiss is not a responsive pleading; hence the plaintiff can still amend his complaint as a matter of right.

Mandamus is an available remedy in case of amendment as a matter of right: