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G.R. No.

L-2352

July 26, 1910

ELADIO ALONSO, plaintiff-appellee, vs. TOMAS VILLAMOR, ET AL., defendants-appellants. Ledesma, Sumulong and Quintos, for appellants. J. C. Knudson, for appellee. MORELAND, J.: This is an action brought to recover of the defendants the value of certain articles taken from a Roman Catholic Church located in the municipality of Placer, and the rental value of the church and its appurtenances, including the church cemetery, from the 11th day of December, 1901, until the month of April, 1904. After hearing the evidence, the court below gave judgment in favor of the plaintiff for the sum of P1,581, with interest at 6 per cent from the date of the judgment. The said sum of P1,581 was made up of two items, one of which, P741, was for the value of the articles taken from the church, and the other, P840, the rental value of the premises during the occupations by defendants. From this judgment the defendants appealed to this court. It appears that the defendants were on the 11th day of December, 1901, members of the municipal board of the municipality of Placer, and that they on that date addressed to the plaintiff in this case, who was the priest in charge of the church, its appurtenances and contents, the following letter: PLACER, 11th December, 1901. R. P. ELADIO ALONSO, Benedicto, Suriago. ESTEEMED PADRE: After saluting you, we take the liberty of writing you that in the municipality of which we have charged we have received an order from the provincial fiscal, dated the 5th instant, which says: "The cemeteries, convents, and the other buildings erected on land belonging to the town at the expense of the town and preserved by it belong to the town, and for this reason the municipality is under the obligation of administering them and of collecting the revenues therefrom, and for this reason we notify you that from this date all of the revenues and products therefrom must be turned into the treasury of the municipality in order that the people may properly preserve them. In the same way we notify you that the image of St. Vicente which is now in the church, as it is an image donated to the people by its owner, by virtue of said order is also the property of said people, and therefore the alms which are given it by the devotees thereof must be also turned into the municipal treasury for the proper preservation of the church and for other necessary purposes. We hope that you will view

in the proper light and that you will deliver to the bearer of this letter the key of the alms box of the said image in order that we may comply with our obligation in conformity with the dispositions of said order. We beg to remain as always by your spiritual sons. Q. B. S. M. (Signed) ANDRES OJEDA. TOMAS VILLAMOR. ANDRES CALINAUAN. BERNARDINO TANDOY. EUSEBIO LIRIO. ELEUTERIO MONDAYA. MAXIMO DELOLA. SEGUNDO BECERRO. ONOFRE ELIMANCE. On the 13th of December, 1901, the defendants took possession of the church and its appurtenances, and also of all of the personal property contained therein. The plaintiff, as priest of the church and the person in charge thereof, protested against the occupation thereof by the defendants, but his protests received no consideration, and he was summarily removed from possession of the church, its appurtenances and contents. The only defense presented by the defendants, except the one that the plaintiff was not the real party in interest, was that the church and other buildings had been erected by funds voluntarily contributed by the people of that municipality, and that the articles within the church had been purchased with funds raised in like manner, and that, therefore, the municipality was the owner thereof. The question as to the ownership of the church and its appurtenances, including the convent and cemetery, was before this court on the 23rd day of September, 1908, in an action entitled "The Roman Catholic Apostolic Church against the municipality of Placer."1 Substantially the same facts were presented on the part of the defendants in that case as are presented by the defendants in this. The question there litigated was the claim upon the part of the municipality of ownership of said church and its appurtenances on the ground that according to Spanish law the Roman Catholic Apostolic Church was not the owner of such property, having only the use thereof for ordinary ecclesiastical and religious purposes, and that the true owner thereof was the municipality or the State by reason of the contributions by them, or by the people, of the land and of the funds with

which the buildings were constructed or repaired. The court decided in that case that the claim of the defendants was not well founded and that the property belonged to the Roman Catholic Church. The same question was discussed and decided in the case of Barlin vs. Ramirez (7 Phil. Rep., 41), and the case of The Municipality of Ponce vs. Roman Catholic Apostolic Church in Porto Rico (28 Sup. Ct. Rep., 737, 6 Off. Gaz., 1213). We have made a careful examination of the record and the evidence in this case and we have no doubt that the property sued for was, at the time it was taken by the defendants, the property of the Roman Catholic Church, and that the seizure of the same and occupation of the church and its appurtenances by the defendants were wrongful and illegal. We are also convinced, from such examination, that the conclusions of the court below as to the value of the articles taken by the defendants and of the rent of the church for the time of its illegal occupation by the defendants were correct and proper. While some objection was made on appeal by counsel for the defendants that the value of the articles taken and of the rent of the church and its appurtenances had not been proved by competent evidence, no objection to the introduction of the evidence of value was made at the trial and we can not consider that question raised for the first time here. We have carefully examined the assignments of error made by counsel for defendants on this appeal. We find none of them well founded. The only one which deserves especial attention at our hands is the one wherein the defendants assert that the court below erred in permitting the action to be brought and continued in the name of the plaintiff instead of in the name of the bishop of the diocese within which the church was located, or in the name of the Roman Catholic Apostolic Church, as the real party in interest. It is undoubted the bishop of the diocese or the Roman Catholic Apostic Church itself is the real party in interest. The plaintiff personally has no interest in the cause of action. Section 114 of the Code of Civil Procedure requires that every action must be prosecuted in the name of the real party in interest. The plaintiff is not such party. Section 110 of the Code of Civil Procedure, however, provides: SEC. 110. Amendments in general. The court shall, in furtherance of justice, and on such terms, if any, as may be proper, allow a party to amend any pleading or proceeding and at any stage of the action, in either the Court of First Instance or the Supreme Court, by adding or striking out the name of any party, either plaintiff or defendant, 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. The court may also, upon like terms, allow an answer or other pleading to be made after the time limited by the rules of the court for filing the same. Orders of the court upon the matters provided in this section shall be made upon motion filed in court, and after notice to the adverse party, and an opportunity to be heard. Section 503 of the same code provides: SEC. 503. Judgment not to be reversed on technical grounds. No judgment shall be reversed on formal or technical grounds, or for such error as has not prejudiced the real rights of the excepting party. We are confident under these provisions that this court has full power, apart from that power and authority which is inherent, to amend the process, pleadings, proceedings, and decision in this case by substituting, as party plaintiff, the real party in interest. Not only are we confident that we may do so, but we are convinced that we should do so. Such an amendment does not constitute, really a change in the identity of the parties. The plaintiff asserts in his complaint, and maintains that assertion all through the record, that he is engaged in the prosecution of this case, not for himself, but for the bishop of the diocesenot by his own right, but by right of another. He seeks merely to do for the bishop what the bishop might do for himself. His own personality is not involved. His own rights are not presented. He claims no interest whatever in the litigation. He seeks only the welfare of the great church whose servant he is. Gladly permits his identity to be wholly swallowed up in that of his superior. The substitution, then, of the name of the bishop of the diocese, or the Roman Catholic Apostolic Church, for that of Padre Alonso, as party plaintiff, is not in reality the substitution of one identity for another, of one party for another, but is simply to make the form express the substance. The substance is there. It appears all through the proceedings. No one is deceived for an instant as to whose interest are at stake. The form of its expression is alone defective. The substitution, then, is not substantial but formal. Defect in mere form can not possibly so long as the substantial is clearly evident. Form is a method of speech used to express substance and make it clearly appear. It is the means by which the substance reveals itself. If the form be faulty and still the substance shows plainly through no, harm can come by making the form accurately expressive of the substance. No one has been misled by the error in the name of the party plaintiff. If we should by reason of this error send this back for amendment and new trial, there would be on the retrial the same complaint, the same answer, the same defense, the same interests, the same witnesses, and the same evidence. The name of the plaintiff would constitute the only difference between the old trial and the new. In our judgment there is not enough in a name to justify such action.

There is nothing sacred about processes or pleadings, their forms or contents. Their sole purpose is to facilitate the application of justice to the rival claims of contending parties. They were created, not to hinder and delay, but to facilitate and promote, the administration of justice. They do not constitute the thing itself, which courts are always striving to secure to litigants. They are designed as the means best adapted to obtain that thing. In other words, they are a means to an end. When they lose the character of the one and become the other, the administration of justice is at fault and courts are correspondingly remiss in the performance of their obvious duty. The error in this case is purely technical. To take advantage of it for other purposes than to cure it, does not appeal to a fair sense of justice. Its presentation as fatal to the plaintiff's case smacks of skill rather than right. A litigation is not a game of technicalities in which one, more deeply schooled and skilled in the subtle art of movement and position, entraps and destroys the other. It is, rather, a contest in which each contending party fully and fairly lays before the court the facts in issue and then, brushing aside as wholly trivial and indecisive all imperfections of form and technicalities of procedure, asks that justice be done upon the merits. Lawsuits, unlike duels, are not to be won by a rapier's thrust. Technicality, when it desserts its proper office as an aid to justice and becomes its great hindrance and chief enemy, deserves scant consideration from courts. There should be no vested rights in technicalities. No litigant should be permitted to challenge a record of a court of these Islands for defect of form when his substantial rights have not been prejudiced thereby. In ordering this substitution, we are in accord with the best judicial thought. (McKeighan vs. Hopkins, 19 Neb., 33; Dixon vs. Dixon, 19 Ia., 512; Hodgesvs. Kimball, 49 Ia., 577; Sanger vs. Newton, 134 Mass., 308; George vs. Reed, 101 Mass., 378; Bowden vs. Burnham, 59 Fed. Rep., 752; Phipps and Co.vs. Hurlburt, 70 Fed. Rep., 202; McDonal vs. State, 101 Fed. Rep., 171; Morford vs. Diffenbocker, 20 N. W., 600; Costelo vs. Costelo vs. Crowell, 134 Mass., 280; Whitaker vs. Pope, 2 Woods, 463, Fed. Cas. no. 17528; Miller vs. Pollock, 99 Pa. St., 202; Wilson vs. Presbyterian Church, 56 Ga., 554; Wood vs. Circuit Judge, 84 Mich., 521; Insurance Co, vs. Mueller, 77 Ill., 22; Farman vs. Doyle, 128 Mich., 696; Union Bank vs. Mott, 19 How. Pr., 114; R. R. Co. vs. Gibson, 4 Ohio St., 145; Hume vs. Kelly, 28 Oreg., 398.) It is therefore, ordered and decreed that the process, pleadings, proceedings and decision in this action be, and the same are hereby, amended by substituting the Roman Catholic Apostolic Church in the place and stead of Eladio Alonso as party plaintiff, that the complaint be considered as though originally filed by the Catholic Church, the answer thereto made, the decision rendered and all proceedings in this case had, as if the said institution which Father Eladio Alonso undertook to represent were the party plaintiff, and that said decision of the court below, so amended, is affirmed, without special finding as to the costs.

Arellano, C. J., Torres, Johnson and Trent, JJ., concur.

applied

for

an

additional

Case-to-Case

Loan

worth P1,500,000.00.[9] Both loans were respectively paid on January 31 and March 27, 1996. Meanwhile, beginning March 19, 1996, petitioner allegedly re-availed the P8 million credit line under the original Credit Accommodation through promissory notes NEGROS MERCHANTS ENTERPRISES, INC., Petitioner, Santiago, J. (Chairperson), - versus G.R. No. 150918 Present: YnaresAustria-Martinez, ChicoNazario, Nachur a, and Reyes, JJ. CHINA BANKING CORPORATION, Respondent. d: Promulgate executed by Tan.[10] Petitioner failed to settle the obligation, letter[11] hence respondent sent a demand with warning to foreclose on the real estate

THIRD DIVISION

mortgage. Petitioner, through its counsel Atty. Raphael A. Diaz, sent two letters[12] to respondent requesting a detailed statement of account and to hold in abeyance any legal action. The latter replied that said statement could not be released without proper board resolution or authorization.[13] Subsequently, petitioners properties were extrajudicially foreclosed and sold in public auction, with respondent as the highest bidder. On March 6, 1998, the Ex-Officio Provincial Sheriff of Negros Occidental issued the corresponding Certificate of Sale [14] in favor of respondent. On March 16, 1999, petitioner filed a Complaint for Annulment of Foreclosure Sale with Damages and Preliminary dismiss[16] Injunction.[15] Respondent moved to the same on the ground that petitioner failed to

August 17, 2007 x --------------------------------------------------------------------------------------- x DECISION YNARES-SANTIAGO, J.:

show by clear and convincing evidence that it is entitled to the relief sought in the complaint. Petitioner later filed an Amended Complaint[17] impleading Tan and his spouse, Corazon V. Tan, as well as respondents Bacolod Branch Manager Ainalea Lim-Cortez. Respondent again sought to dismiss[18] the amended complaint for failure to state cause of action and for failure to comply with the rules on non-forum shopping.[19] Meanwhile, title over TCT Nos. T-139095 and T139096 were consolidated[20] in favor of respondent. On September 15, 1999, the Regional Trial Court of Bacolod City, Branch 46, granted respondents Petition for Issuance of a Writ of Possession for the said properties.[21] On September 22, 2000, the Regional Trial Court of Bacolod City, Branch 41, denied respondents Motion to Dismiss. Respondent moved for reconsideration[22] but was likewise denied. Thereafter, respondent filed a petition for

This Petition for Review on Certiorari[1] assails the September 7, 2001 Decision[2] of the Court of Appeals in CA-G.R. SP No. 65127, which annulled and set aside the September 22, 2000 and March 19, 2001 Orders[3] of the Regional Trial Court of Bacolod City, Branch 41 in Civil Case No. 99-10707, as well as the November 12, 2001 Resolution[4] denying the Motion for Reconsideration. The facts of the case are as follows: On August 23, 1993, petitioner Negros Merchants Enterprises, Inc. (NMEI), through its President and General Manager, Jacinto Y. Tan, Jr., applied for an P8 million Credit Accommodation with respondent China Banking Corporation (CBC), with terms ONE YEAR LOAN LINE, RENEWABLE THEREAFTER.[5] Certificate of mortgage[6] over AND RE-AVAILABLE ANNUALLY The loan was secured by a real estate its properties covered by Transfer Title (TCT) Nos. T-139095[7] and T-

certiorari before the Court of Appeals assailing the Orders of the trial court denying the motion to dismiss and the motion for reconsideration. On September 7, 2001, the

139096.[8] On December 21, 1994, petitioner, through Tan,

Court of Appeals rendered the assailed Decision, the dispositive portion of which provides: WHEREFORE, premises considered, the present petition is GIVEN DUE COURSE and the writs prayed for, accordingly GRANTED. The Orders dated September 22, 2000 and March 19, 2001 which were both issued by respondent Judge RAY ALAN T. DRILON of Branch 41 of the Regional Trial court of Bacolod City in Civil Case No. 99-10707, entitled Negros Merchants Enterprises, Inc. v. China Banking Corporation, Spouses Jacinto Y. Tan, Jr. and Corazon V. Tan and Ex-Officio Provincial Sheriff of Negros Occidental are hereby ANNULLED and SET ASIDE. Respondent Judge, who is hereby permanently ENJOINED from enforcing the said Orders dated September 22, 2000 and March 19, 2001, is hereby ORDERED to dismiss Civil Case No. 99-10707 insofar as petitioner China Banking Corporation is concerned. Costs respondent. against private

for certiorari questioning the two interlocutory orders issued by the trial court as the same shall be reviewed only when an appeal is taken from the judgment of the trial court; that since no actual hearing was yet conducted, there is no evidence which the appellate court could use as basis to resolve the case on the merits or to determine whether the trial judge acted with grave abuse of discretion amounting to lack or in excess of jurisdiction. Petitioner also argues that trial courts have the authority to determine whether the allegations in a complaint are sufficient to support a cause of action and that they have the discretion to resolve a motion to dismiss on the ground of failure to state a cause of action based only on the complaint or based on other pleadings submitted by the parties. Thus, petitioner concludes that the trial judge acted within his discretion and authority in denying the motion to dismiss. Petitioner likewise claims that the amended complaint cannot be considered an initiatory pleading which requires an accompanying certification against forum shopping. Since respondents first motion to dismiss did not raise in issue the alleged defective certification, it is deemed to have waived any objection thereto, in accordance with Section 8, Rule 15 of the Rules of Court.[24] However, in the event the certification is found to be defective, petitioner maintains that it substantially complied with the rules and that the substance of the complaint should not be subordinated to procedural lapses. Finally, petitioner asserts that the full payment of the P8 million loan accommodation on January 31, 1996 rendered documents the mortgage contract without and other or connected thereto force

SO ORDERED.[23] The Court of Appeals held that the Amended Complaint should have been dismissed because the accompanying certification against forum shopping which was signed by petitioners corporate secretary, Amelito Lizares, was defective, for lack of authorization from the board of directors; that the allegations in the amended complaint were insufficient to establish a cause of action; that petitioner defaulted in paying the loan, thus respondent rightfully foreclosed the mortgaged properties; that petitioner cannot validly claim ignorance of the foreclosure proceedings; that the alleged collusion between manager Tan lacks and basis respondents because Bacolod petitioner branch expressly

effect. Accordingly, the mortgage contract should be deemed cancelled, and the properties subject thereto deemed released, instead of using them as security for the loans fraudulently obtained by Tan, and subsequently foreclosing them when the latter failed to pay. Petitioner, thus, prays for the reinstatement of the complaint against

authorized Tan to enter into loan transactions in its behalf with the latter; and that the trial judge acted with grave abuse of discretion in denying respondents Motion to Dismiss. The motion for reconsideration filed by petitioner was denied for lack of merit; hence, the present petition for review on certiorari. Petitioner insists that the Court of Appeals departed from jurisprudential and procedural law when it entertained respondents petition

respondent for further proceedings. The petition lacks merit. In Espao, Sr. v. Court of Appeals,[25] the Court held that an order denying a motion to dismiss is merely interlocutory and therefore not appealable, nor can it be

the subject of a petition for review on certiorari. Such order may only be reviewed in the ordinary course of law by an appeal from the judgment after trial. The ordinary procedure to be followed in that event is to file an answer, go to trial, and if the decision is adverse, reiterate the issue on appeal from the final judgment.[26] Thus, when the trial court denied respondents motion to dismiss, its next course of action would have been to file an answer and proceed with the trial of the case. It therefore erred when it filed instead a petition for certiorari before the Court of Appeals. Nevertheless, while indeed respondent erred in filing a petition for certiorari before the appellate court, we agree with the Court of Appeals that petitioners Amended Complaint should have been dismissed due to its defective verification and certification against forum shopping. It is settled that the requirement to file a certificate of non-forum shopping is mandatory and that the failure to comply with this requirement cannot be excused. The certification is a peculiar and personal responsibility of the party, an assurance given to the court or other tribunal that there are no other pending cases involving basically the same parties, issues and causes of action.[27] behalf of In a case where the plaintiff is a private corporation, the certification may be signed, for and on the said corporation, of the by a specifically be authorized person, including its retained counsel, who has personal knowledge established by the In the facts required to documents.[28] case, the Verification and

3. That I hereby certify that I have not commenced any other actions or complaint involving the same issues in the Supreme Court, Court of Appeals, or different Division thereof or any court or tribunal or agency, and to the best of my knowledge, no such action or proceeding is pending in the Supreme Court, Court of Appeals, or different Division thereof or any court or tribunal or agency; that in the event that a similar action or preceding [sic] has been filed or is pending before the Supreme Court, Court of Appeals, or different Division thereof, I hereby bind myself to notify the Court, tribunal, or agency within five (5) days from such notice. IN WITNESS WHEREOF, I have hereunto set my hand this 16th day of March, 1999/12th day of October 1999, at Bacolod City, Philippines.

( S g d . ) A MELITO LIZARES[
29]

As can be gleaned from the foregoing, there was no allegation that petitioner Negros Merchants Enterprises, Inc., through a board resolution, authorized Lizares to execute the verification and certification of non-forum shopping. Moreover, no such board resolution was appended to the complaint or amended complaint.

present

Certification attached to the original and amended complaints of petitioner Negros Merchants Enterprises, Inc. reads as follows: I, AMELITO LIZARES, after being duly sworn, depose and state: 1. That I am the Corporate Secretary of Negros Merchants Enterprises, Inc. the plaintiff in the aboveentitled case; 2. That I have caused the preparation of the foregoing complaint; and that all the allegations contained therein are true of my own personal knowledge;

In Tamondong v. Court of Appeals,[30] we held that if a complaint is filed for and in behalf of the plaintiff who is not authorized to do so, the complaint is not deemed filed. An unauthorized complaint does not Hence, the court should produce any legal effect.

dismiss the complaint on the ground that it has no jurisdiction over the complaint and the plaintiff.[31] In the instant case, Lizares was not authorized to file the complaint for and in behalf of petitioner corporation. Thus, the complaint is not deemed filed by the proper party in interest and should be dismissed. Indeed, there is jurisprudence where the Court allowed substantial compliance with the rule on

certification exceptional

of

no-forum

shopping; and/or

however, social

the RUBEN T. REYES Associate Justice

circumstances

justice

considerations present in those cases are wanting in petitioners Complaint or Amended Complaint. The words used in petitioners verification and certification of no-forum shopping clearly state that Lizares solely caused the preparation of the present case, without even averring that he had done so in behalf of petitioner. There was no belated filing of a proper verification and certification, or even a copy of the board resolution or a secretarys certificate attesting that Lizares was authorized to file said complaint or the amendment thereto. Instead, petitioner merely declared without qualification or explanation in its Opposition to Motion to Dismiss that there was sufficient compliance as could be gleaned from the complaint.[32] There is likewise no merit in petitioners assertion that the amended complaint was not an initiatory pleading. Section 8, Rule 10 of the Rules of Court clearly provides that an amended complaint supersedes the complaint that it amends. WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated September 7, 2001 in CAG.R. SP No. 65127, which annulled and set aside the Orders of the Regional Trial Court of Bacolod City, Branch 41 denying the motion to dismiss, and ordering the Regional Trial Court of Bacolod City, Branch 41, to dismiss Civil Case No. 99-10707, as well as the November 12, 2001 Resolution denying the motion for reconsideration, are AFFIRMED. SO ORDERED. SANTIAGO

ATTESTATION I attest that the conclusions in the above decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

CONSUELO Justice Chairperson, Division

YNARESAssociate Third

CONSUELO YNARESSANTIAGO Associate Justice WE CONCUR:

MA. ALICIA AUSTRIA-MARTINEZ Associate Justice

MINITA V. CHICO-NAZARIO Associate Justice

ANTONIO EDUARDO B. NACHURA Associate Justice

CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution and the Division Chairpersons Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.

REYNATO S. PUNO Chief Justice

Rollo, pp. 9-44. Id. at 46-55; penned by Associate Justice Martin S. Villarama, Jr. and concurred in by Associate Justices Conrado M. Vasquez, Jr. and Eliezer R. De Los Santos. [3] Id. at 58-60 and 61-63; penned by Judge Ray Alan T. Drilon. [4] CA rollo, p. 257. [5] Id. at 69. [6] Id. at 82-85. [7] Id. at 86-87. [8] Id. at 88-89. [9] Id. at 91-92. [10] Id. at 95-104 and (corresponding extension promissory notes) 105-112. [11] Rollo, p. 142. [12] Id. at 144-145. [13] Id. at 146-147. [14] Id. at 82-83. [15] Id. at 64-68 [16] Id. at 84-113. [17] Id. at 176-181. [18] Id. at 199-241. [19] RULES OF COURT, Rule 7, Sec. 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. 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,
[1] [2]

unless otherwise provided, upon motion and after hearing. The submission of a false certification or noncompliance 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. [20] CA rollo, pp. 132-133. [21] Id. at 134-138; in CAD. Case No. 99-983, penned by Judge Emma C. Labayen. [22] Id. at 325-340. [23] Id. at 55. [24] RULES OF COURT, Rule 15, Sec. 8. Omnibus Motion Subject to the provisions of Section 1 of Rule 9, a motion attacking a pleading, order, judgment, or proceeding shall include all objections then available, and all objections not so included shall be deemed waived. [25] 335 Phil. 983 (1997). [26] Id. at 987-988. [27] Expertravel & Tours, Inc. v. Court of Appeals, G.R. No. 152392, May 26, 2005, 459 SCRA 147, 157. [28] Id. [29] Rollo, pp. 68 and 180-181. [30] G.R. No. 158397, November 26, 2004, 444 SCRA 509. [31] Id. at 519. [32] CA rollo, p. 201.

decision de la Corte Suprema. Con este queda definitivamente cumplimentada esta ejecucion. Y para que asi conste, firmo la presente en el Municipio de Bais, Provincia de Negros Oriental, I. F., ante el Sheriff Provincial de esta Provincia de Negros Oriental y el Notario Publico Don Francisco Romero, que ratifica este compromiso. (Fda.) JOSEFINA RUBIO, Vda. DE LARENA Firmado en presencia de: (Fdos.) BRAULIO RUBIO FRANCISCO PINERO (ACKNOWLEDGMENT) OSTRAND, J.: The case at bar is a sequel to case G. R. No. 21706, Josefina Rubio de Larena vs. Hermenegildo Villanueva, decided on March 26, 1924. 1 In that case we affirmed a decision of the Court of First Instance ordering the rescission of a lease of the Tacgajan Sugar Plantation and the payment by the defendant-lessee of the unpaid balance of the rent for the agricultural year 1920-1922 in the sum of P5,949.28 with interest from August 26, 1922, an for P8,000 in rent for the agricultural year 1921-1923. The decision also provided that the possession of the leased land be delivered to the plaintiff. Shortly after the record was returned to the court below, a writ of execution was issued, but before levy was made the parties came to an agreement, under which the money judgment was to be satisfied by the payment of P10,500 in cash and the transfer to the plaintiff of a dwelling house situated in the municipality of Bais. The agreement was carried out in accordance with its terms, and on September 30, 1924, the following document was executed by the plaintiff: Habiendo llegado a un convenio entre la que subscribe, ejecutante, en la causa civil No. 67 decidida por la Corte Suprema, y el ejecutado, Don Hermenegildo Villanueva, por la presente declaro haber recibido del Sheriff Provincial de Negros Oriental, y mi entera satisfaccion la suma de diez mil quinientos pesos (P10,500), mas una casa residencial con su solar, situada en la plaza del Municipio de Bais, Provincia de Negros Oriental, cuyas descripciones aparecen an un ocumento aparte, por el importnte de la ejecusacion expidida por el Jusgado de Negros Oriental al 14 de mayo de 1924, en vitud de una In the meantime, the defendant had harvested the sugarcane crop produced in the agricultural year 19221924, and after having satisfied the aforesaid money judgment, he also continued in possession of the plantation long enough to appropriate to himself the following ratoon cane crop. The present action was brought on April 13, 1925, but the last amended complaint, setting forth three causes of action, was not filed until June 17, 1927. As her first cause of action the plaintiff, after a preliminary statement of the origin of the controversy, alleges that while case G. R. No. 21706 was on appeal to the Supreme Court, the defendant knew positively that the aforesaid lease was declared rescinded by the Court of First Instance on September 8, 1923, and that he, the defendant, also knew that he thereafter was not entitled to the possession of the aforesaid hacienda; that he, nevertheless, in bad faith continued in such possession during the agricultural year 1922-1924 and appropriated to himself the cane harvest for that year, which after deducting the share of the sugar central, produced 1,679.02 piculs for his own benefit, which sugar was sold by him for the sum of P13 a picul; that the plaintiff has demanded payment to her of the total value of said 1,679.02 piculs, amounting to P21,827.26, but that the defendant refuses to pay. The plaintiff, therefore, asks judgment for the sum of P21,827.26 upon the first cause of action. For the second cause of action the plaintiff alleges that under the contract of lease of the Tacgajan Hacienda, one of the obligations assumed by the defendant was that he would use the care of a good father of the family in conserving the tools, agricultural implements, draft animals, and other effects enumerated in an inventory made at the time the defendant entered in possession under the lease; that he was further obligated to return said property to the plaintiff, but that he return said property to the plaintiff, but that he

EN BANC G.R. No. L-29155 November 5, 1928

JOSEFINA RUBIO DE LARENA, plaintiff-appellant, vs. HERMENEGILDO VILLANUEVA, defendant-appellee. Abad Santos, Camus and Delgado and Jose Montano for appellant. Del Rosario and Del Rosario for appellee.

returned only a part that he returned only a part thereof and failed to returned only a part thereof and failed to return 4 carabaos, 4 vacunos, 1 corn mill, 4 wagons, 106 steel rails, 14 plows, 1 table, 1 scale, an 1 telephone, the total value of the property enumerated being P3,596 for which amount, plus P500 in damages, the plaintiff asks judgment under her second cause of action. As a third cause of action the plaintiff alleges that the harvest of sugar cane illegally made by the defendant in 1924 left ratoon sugar cane in the fields of the hacienda, which sugar can was the property of the plaintiff, and that during the year 1925, the defendant illegally harvested said ratoon cane together with some recently planted cane, which harvested after deducting the share of the sugar central, produced 1,613.25 piculs of sugar, which the defendant sold for his own benefit at the price of P13 per picul, the total amount received by him being P20,962.25 for which the plaintiff demands judgment. In his answer to the first and third causes of action, the defendants alleges that according to the pleadings in case G. R. No. 21706, the two causes of action were included in that case and, therefore, must be considered res adjudicata. In regard to the second cause of action the defendant pleads the general issue and sets up as a special defense that assuming that the property referred to in said cause of action was missing, it loss was due to its total extinction by ordinary use, for which the defendant could not be held responsible. For all three causes of action, the defendant sets up as a special defense the document executed by the plaintiff on September 30, 1924, acknowledging the satisfaction of the judgment in case G. R. No. 21706. Upon trial the Court of First Instance sustained the defendant's special defense and absolved him from the complaint with the cost against the plaintiff, whereupon the latter appealed to this court. We do not think that the court below erred in absolving the defendant from liability upon the second cause of action. It is not without significance that in her original complaint the plaintiff claimed only 5 plows, 6 carts, 3 carabaos an 4 vacunos, the total value of which was alleged to be P1,360; in the first amended complaint filed over two years later, the same claim was made, but in the last amended complaint a number of other articles were included, thus increasing the claim to P3,596. The court below found that the weight of the evidence showed that the missing draft animals died from rinderpest and that the other personal property was turned over to the provincial sheriff for delivery to the plaintiff before the writ of execution was returned to the court. If so, the action would lie against the sheriff rather than against the defendant. As to the first cause of action the defendant argues that it was included in the prayer of an amended complaint filed in case G. R. No. 21706 and that, although no express determination thereof was made in the decision of the case, it must, nevertheless, be

regarded as res judicata. That such is not the case is very clear. The Code of Civil Procedure says: That only is deemed to have been so adjudged in a former judgment which appears upon its face to have been so adjudged, or which was actually and necessarily included therein or necessary thereto. (Sec. 307, Code of Civil Proc.) But the defendant maintains that the plaintiff having had an opportunity to ventilate the matter in the former case, she cannot now enforce the same cause of action in the present case. Properly speaking, this argument does not involve the doctrine of res judicata but rests on the well-known an, in American law, firmly established principle that a party will not be permitted to split up a single cause of action an make it the basis for several suits. But that is not this case. The rule is well established that when a lease provides for the payment of the rent in separate installments, each installment is an independent cause of action, though it has been held and is good law, that in an action upon such a lease for the recovery of rent, the installments due at the time the action brought must be included in the complaint an that failure to o so will constitute a bar to a subsequent action for the payment of that rent. The aforesaid action, G. R. No. 21706, was brought on August 23, 1922, the plaintiff demanding payment of then sue rent in addition to the rescission of the lease. On July 27, 1923, the plaintiff filed a motion for an amendment to paragraph 6 of the complaint adding to that paragraph the following sentence: Que tambien ha vencido ya el tercer ano el arrendamiento de la finca en cuestion y que tampoco ha pagado el demandao el canon correspondiente a icho ano. The plaintiff also amended the prayer of the complaint by asking judgment for rent for years subsequent to 1922. The motion was granted, and the case came up for trial on July 30, 1923, and on September 8, 1923, the trial court rendered its decision giving judgment for rent up to and including the rent for the agricultural year ending in 1923. The lease did not provide for payment of rent in advance or at any definite time, an it appears plainly from the record that the rent for an agricultural year was not considered due until the end of the corresponding year. It follows that the rent for the agricultural year 1922-1924 ha not become sue time of the trial of the case and that consequently the trial court could not render judgment therefore. The action referred to is, therefore, no bar to the first cause of action in the present litigation. The defendant places much weigh upon the document of September 30, 1924, hereinbefore quoted. The document speaks for itself, and it will be readily seen that it is merely a receipt for the satisfaction of the money judgment in the case G. R. No. L-21706 and has nothing to with the present case.

The only question in regard to the first cause of action relates to the amount of the damages. The plaintiff contends that the defendant was a possessor in bad faith, and therefore, must pay the value of the fruits of the land in accordance with article 455 of the Civil Code. Under the circumstances of the case, we cannot so hold. The defendant held possession under the contract of lease until said contract was rescinded. The contract contained no special provision for the procedure in effecting the rescission, and it follows that it could only be accompanied by a final judgment of the court. The judgment in case G. R. No. L-210706 did not become final until March 27, 192, when our decision on appeal was rendered. As that must have been close to the end of the harvest and milling of the sugar crop for the period to which the first cause of action refers, we do not think that the defendant should be required to pay more than the amount of the stipulated rent for the period, i. e., the sum of P8,000 with interest rent for that period, i. e., the sum of P8,000 with interest. (Lerma vs. De la Cruz, 7 Phil., 581.) The action for terminating the lease was brought under article 1124 of the Civil Code, an it may, perhaps, he said that properly speaking, the subject matter of the action was a resolution of the contract an not a rescission. That may be true, but it is a distinction without a difference; in their case a judicial declaration would be necessary for the cancellation of the contract in the absence of a special agreement. Very little need be said in regard to the third cause of action. It relates to a period subsequent to the complete termination of the lease by final judicial order. The defendant had then no right whatever to the possession of the land or to the fruits thereof, and in removing the fruits, he acted in bad faith. This being the case, he must pay for the fruits received by him, less the necessary expenses of production. (Arts. 455 and 453 of the Civil Code.) As his bad faith commence long before the fruits in question were produced, he is not entitled to any part of the net proceeds of the crop. The evidence shows that the net ratoon crop of the year 1924-1925 was 1,613.25 piculs of sugar, and according to the defendant's own statement, the market value of the sugar was in the neighborhood of P11 per picul an the costs of production about P4.50. The net result is that under the third cause of action, the defendant must pay to the plaintiff the sum of P10,486.13 with interest. For the reason stated, the judgment of the court below is affirmed in regard to the second cause of action. It is reversed as to the first and third causes of action, and it is hereby ordered that the plaintiff have and recover from the defendant the sum of P18,486.13 with interest at the rate of 6 per cent per annum from April 13, 1925, the date of the filing of the complaint. No costs will be allowed. So ordered. Avancea, C. J., Johnson Street, Malcolm, Villamor, Romualdez, an Villa-Real, JJ., concur. ORDER AMENDING DECISION

December 10, 1928 OSTRAND, J.: In the motion filed by the defendant on November 14, 1928 our attention is called to a mathematical error in that we, in discussing the plaintiff's third cause of action, failed to take into consideration the fact that one-half of the gross ratoon crop produced on the land in question in the agricultural year 1924-1925 was ceded to the sugar central as compensation for the milling of the cane and that the defendant paid the expenses of the production of the total or gross crop. Page 8 of the aforesaid decision is therefore amended so as to read as follows: Very little need be said in regard to the third cause of action. It relates to a period subsequent to complete termination of the lease by final judicial order. The defendant had then no right whatever to the possession of the land or to the fruits thereof, and in removing the fruits, he acted in bad faith. This being the case, he must pay for the fruits received by him, less the necessary expenses of production (Arts. 455 and 453 of the Civil Code.) As his bad faith commenced long before the fruits in question were produced, he is not entitled to any part of the net proceeds of the crop. The evidence shows that the gross ratoon crop for the year 1924-1925 was 3,226.50 piculs of sugar, and according to the defendant's own statement, the market value of the sugar was in the neighborhood of P11 per picul and the cost of production about P4.50. The defendant received only one-half of the gross crop, the other half going to the sugar central as compensation for the milling of the cane, but the defendant paid the cost of production both of his share of the sugar and that of the sugar central. The net result is that under the third cause of action, the defendant must pay to the plaintiff the sum of P3,226.50 with interest. "For the reasons stated, the judgment of the court below is affirmed in regard to the second cause of action. It is reversed as to the first an third causes of action, an it is hereby ordered that the plaintiff have and recover from the defendant the sum of P11,226.50 with interest at the rate of 6 per cent per annum from April 13, 1925, the date of the filing of the complaint. No costs will be allowed." So ordered. Avancea, C. J., Johnson, Street, Malcolm, Villamor, Romualdez, and Villa-Real, JJ., concur.

EN BANC G.R. No. L-23700 March 18, 1925

The petitioner further alleges that the execution of the judgment is premature inasmuch as the period of three months from the date of the judgment provided for in section 256 of the Code of Civil Procedure for the execution of a judgment in foreclosure proceedings had not then expired; that the interests of the petitioner will suffer grave injury from the premature execution of the judgment; and that the petitioner has no other plain, speedy, and adequate remedy in the ordinary course of law than to apply to this court for an order enjoining the respondents from proceeding with the aforesaid sale. Upon being required to answer the petition within five days, the respondents in lieu of an answer filed a demurrer which will be considered as an answer admitting the material allegations of the petition. The case was thereupon set down for hearing on February 17, 1925, at which hearing the parties were represented by counsel and arguments submitted. The only question presented for our consideration is whether, in the event a judgment for the plaintiff in a foreclosure proceeding is affirmed on appeal, the three months stay of execution allowed the defendant by section 256 of the Code of Civil Procedure is to be counted from the date of the judgment of the lower court or whether it should be counted from the date of the final determination of the case by the appellate court. The respondents maintain that under the second paragraph of section 506 of the Code of Civil Procedure the judgment must, in regard to its execution, be treated as if no appeal had been taken and that three months from the date of the original judgment having expired it might be executed immediately upon the remittitur. We cannot accept this view and do not think that the paragraph of the Code upon which the respondents rely supports their contention. The section in which it is found reads as follows: Certificate of judgment to be remitted the Court of First Instance. In all cases heard by the Supreme Court on bills of exception, its judgment shall be remitted to the Courts of First Instance from which the actions respectively came into the Supreme Court; and for this purpose it shall be the duty of the clerk of the Supreme Court, within ten days after the close of any term, to remit to the clerks of Courts of First Instance, notices of all judgments of the Supreme Court in actions brought from the Courts of First Instance respectively. Upon receiving the notice so remitted, the clerk of the Court of First Instance shall enter the same upon his docket and file the notice with the other papers in the action. The judgment so remitted shall be executed by the Court of First Instance, in the same manner as though the action had not been carried to the Supreme Court. But the Supreme Court may, by special order, direct any particular judgment to be remitted to the proper Court of First Instance

BLOSSOM and CO., petitioner, vs. MANILA GAS CORPORATION, RICARDO SUMMERS, sheriff of the City of Manila, and GEORGE R. HARVEY, Judge of First Instance of Manila, respondents. J. Courtney Hixson for petitioner. Thomas Cary Welch for respondents. OSTRAND, J.: Though the petition in this case is styled a "Petition for preliminary injunction," it is in reality a petition for a writ of prohibition. The petitioner alleges, among many other things, more or less immaterial, that on or about October 16, 1923, in the City of Manila, in civil case No. 24267, wherein one of the herein respondents, the Manila Gas Corporation was plaintiff and the herein petitioner Blossom and Co. was the defendant, a judgment in mortgage foreclosure proceedings was rendered against the said Blossom and Co. ordering the payment of P7,794.65 to the said Manila Gas Corporation, with interest thereon at the rate of 8 per cent per annum, the judgment also providing that if the defendant Blossom and Co. failed to satisfy the judgment within ninety days from the time of the notification of said judgment, the mortgaged land should be sold by the sheriff at public auction and the proceeds of the sale applied towards the satisfaction of said judgment; that from said judgment Blossom and Co. appealed to this court and on October 18, 1924, the judgment of the Court of First Instance was affirmed;1 that the decision of this court became final on the 28th of the same month and the record was returned to the court below. It is further alleged that on December 31, 1924, the respondent, the Honorable George R. Harvey, Judge of the Court of First Instance of the City of Manila, ordered that a writ of execution be issued against the defendant in said case No. 24267; that on January 6, 1925, the same respondent modified his order of December 31, 1924, by ordering "that the judgment be executed;" that on or about January 9, 1925, the respondent Ricardo Summers, in his capacity as sheriff of the City of Manila and in compliance with the aforesaid orders, advertised in the newspapers of the City of Manila that the mortgaged property would be sold at public auction to the highest bidder in front of the court house in Manila, at 9 o'clock a.m. on February 6, 1925.

at any time, without awaiting the end of the term. It shall likewise be the duty of the clerk of the Supreme Court, within ten days after the close of any term, to remit to the clerks of the Courts of First Instance, with the notices of all judgments of the Supreme Court in this section referred to, likewise all the original documents and the record of the actions transmitted by the Court of First Instance, in order that the files of the action may remain together in that court. As will be seen, the paragraph in question relates to the manner of executing the judgment and says nothing about the time. As to the time for the execution, section 144 of the Code of Civil Procedure provides that, except by special order of the court, no execution shall issue upon a final judgment until after the period for perfecting a bill of exceptions has expired and that the filing of a bill of exceptions shall of itself stay execution until the final determination of the action, unless for special reasons stated in the bill of exceptions the court shall order that execution be not stayed. In other words, the filing of the bill tolls the running of time pending the final disposition on appeal and we can see no valid reason why this should not apply to the three months period allowed the judgment debtor by section 256 to satisfy the judgment before execution issues. That such is the intent of the statute seems fairly clear. The defendant in a foreclosure proceeding has no right of redemption from the judicial sale of the mortgaged property and the purpose of the three months stay of execution is very evidently to give the judgment debtor time and opportunity to make the necessary arrangements for the payment of the debt after it has been definitely determined that the debt is due and must be paid by him. In the event of an appeal there is no definite determination of the case until it is finally disposed of by the appellate court and if we were to hold that the appeal did not suspend the running of the period mentioned, the result would necessarily be that the defendant would be deprived of the time granted him by the statute to provide funds for the satisfaction of the judgment before its execution. We therefore hold that the running of said period is suspended during the appeal and as the case cannot be said to be finally determined on appeal while the record remains with the appellate court, it logically follows that the period does not begin to run until the remittitur of the record to the court below. In the present case, it is alleged in the petition and admitted by the respondents that the decision of this court in the foreclosure proceedings became final on October 28, 1924, and that on January 9, 1925, only seventy-three days after it became final. It appearing that the execution here in question was begun before the expiration of three months from the final determination of the case, the petition is granted and the respondents are prohibited from proceeding with the execution until after the expiration of the period of three months from October 28, 1924. The respondent,

the Manila Gas Corporation, shall pay the costs. So ordered. Johnson, Malcolm, Villamor, and Romualdez, JJ., concur.

Separate Opinions JOHNS, J., specially concurring: This case is presented on a demurrer to the petition, which in legal effect admits all of the material allegations in the petition. Hence, as the majority opinion says: The only question presented for our consideration is whether, in the event a judgment for the plaintiff in a foreclosure proceedings is affirmed on appeal, the three months stay of execution allowed the defendant by section 256 of the Code of Civil Procedure is to be counted from the date of the judgment of the lower court or whether it should be counted from the date of the final determination of the case by the appellate court. Based on such admissions, I agree with the majority opinion. As it points out, among other things, section 506 of the Code of Civil Procedure says: The judgment so remitted shall be executed by the Court of First Instance, in the same manner as though the action had not been carried to the Supreme Court. If it be a fact that an appeal is dismissed or that no final judgment is rendered by this court, and that the judgment of the lower court remains in legal force and effect as of the day when it was rendered, and that an execution is issued upon the original judgment as it was rendered in the lower court, another and a different question would be presented. But for the reasons above stated, I concur in the result.

Endnotes OSTRAND, J.:


1Manila

Gas Corporation vs. Blossom and Co., R.G. No. 22109, not reported.

University of Santo Tomas, Faculty of Civil Law 2010 All Rights Reserved.

G.R. No. 153788

November 27, 2009

August 8, 1997, the said defendant leased [from] plaintiff a certain motor vehicle which is more particularly described as follows Make/Type FUSO WITH MOUNTED CRANE Serial No. FK416K-51680 Motor No. 6D15-338735 Plate No. GHK-378 as evidenced by a LEASE AGREEMENT WITH OPTION TO PURCHASE entered into by and between KARGO ENTERPRISES, then represented by its Manager, the aforementioned GLENN O. GO, and defendant ROGER NAVARRO xxx; that in accordance with the provisions of the above LEASE AGREEMENT WITH OPTION TO PURCHASE, defendant ROGER NAVARRO delivered unto plaintiff six (6) post-dated checks each in the amount of SIXTY-SIX THOUSAND THREE HUNDRED THIRTY-THREE & 33/100 PESOS (P66,333.33) which were supposedly in payment of the agreed rentals; that when the fifth and sixth checks, i.e. PHILIPPINE BANK OF COMMUNICATIONS CAGAYAN DE ORO BRANCH CHECKS NOS. 017112 and 017113, respectively dated January 8, 1998 and February 8, 1998, were presented for payment and/or credit, the same were dishonored and/or returned by the drawee bank for the common reason that the current deposit account against which the said checks were issued did not have sufficient funds to cover the amounts thereof; that the total amount of the two (2) checks, i.e. the sum of ONE HUNDRED THIRTY-TWO THOUSAND SIX HUNDRED SIXTY-SIX & 66/100 PESOS (P132,666.66) therefore represents the principal liability of defendant ROGER NAVARRO unto plaintiff on the basis of the provisions of the above LEASE AGREEMENT WITH RIGHT TO PURCHASE; that demands, written and oral, were made of defendant ROGER NAVARRO to pay the amount of ONE HUNDRED THIRTY-TWO THOUSAND SIX HUNDRED SIXTY-SIX & 66/100 PESOS (P132,666.66), or to return the subject motor vehicle as also provided for in the LEASE AGREEMENT WITH RIGHT TO PURCHASE, but said demands were, and still are, in vain to the great damage and injury of herein plaintiff; xxx 4. That the aforedescribed motor vehicle has not been the subject of any tax assessment and/or fine pursuant to law, or seized under an execution or an attachment as against herein plaintiff; xxx 8. That plaintiff hereby respectfully applies for an order of the Honorable Court for the immediate delivery of the above-described motor vehicle from defendants unto plaintiff pending the final determination of this case on the merits and, for that purpose, there is attached hereto an affidavit duly executed and bond double the value of the personal property subject matter hereof to answer for damages and costs which defendants may suffer in the event that the order for replevin prayed for may be found out to having not been properly issued.

ROGER V. NAVARRO, Petitioner, vs. HON. JOSE L. ESCOBIDO, Presiding Judge, RTC Branch 37, Cagayan de Oro City, and KAREN T. GO, doing business under the name KARGO ENTERPRISES, Respondents. DECISION BRION, J.: This is a petition for review on certiorari1 that seeks to set aside the Court of Appeals (CA) Decision2 dated October 16, 2001 and Resolution3 dated May 29, 2002 in CA-G.R. SP. No. 64701. These CA rulings affirmed the July 26, 20004 and March 7, 20015 orders of the Regional Trial Court (RTC), Misamis Oriental, Cagayan de Oro City, denying petitioner Roger V. Navarros (Navarro) motion to dismiss. BACKGROUND FACTS On September 12, 1998, respondent Karen T. Go filed two complaints, docketed as Civil Case Nos. 98-599 (first complaint)6 and 98-598 (second complaint),7 before the RTC for replevin and/or sum of money with damages against Navarro. In these complaints, Karen Go prayed that the RTC issue writs of replevin for the seizure of two (2) motor vehicles in Navarros possession. The first complaint stated: 1. That plaintiff KAREN T. GO is a Filipino, of legal age, married to GLENN O. GO, a resident of Cagayan de Oro City and doing business under the trade name KARGO ENTERPRISES, an entity duly registered and existing under and by virtue of the laws of the Republic of the Philippines, which has its business address at Bulua, Cagayan de Oro City; that defendant ROGER NAVARRO is a Filipino, of legal age, a resident of 62 Dolores Street, Nazareth, Cagayan de Oro City, where he may be served with summons and other processes of the Honorable Court; that defendant "JOHN DOE" whose real name and address are at present unknown to plaintiff is hereby joined as party defendant as he may be the person in whose possession and custody the personal property subject matter of this suit may be found if the same is not in the possession of defendant ROGER NAVARRO; 2. That KARGO ENTERPRISES is in the business of, among others, buying and selling motor vehicles, including hauling trucks and other heavy equipment; 3. That for the cause of action against defendant ROGER NAVARRO, it is hereby stated that on

The second complaint contained essentially the same allegations as the first complaint, except that the Lease Agreement with Option to Purchase involved is dated October 1, 1997 and the motor vehicle leased is described as follows: Make/Type FUSO WITH MOUNTED CRANE Serial No. FK416K-510528 Motor No. 6D14-423403 The second complaint also alleged that Navarro delivered three post-dated checks, each for the amount ofP100,000.00, to Karen Go in payment of the agreed rentals; however, the third check was dishonored when presented for payment.8 On October 12, 19989 and October 14, 1998,10 the RTC issued writs of replevin for both cases; as a result, the Sheriff seized the two vehicles and delivered them to the possession of Karen Go. In his Answers, Navarro alleged as a special affirmative defense that the two complaints stated no cause of action, since Karen Go was not a party to the Lease Agreements with Option to Purchase (collectively, the lease agreements) the actionable documents on which the complaints were based. On Navarros motion, both cases were duly consolidated on December 13, 1999. In its May 8, 2000 order, the RTC dismissed the case on the ground that the complaints did not state a cause of action. In response to the motion for reconsideration Karen Go filed dated May 26, 2000,11 the RTC issued another order dated July 26, 2000 setting aside the order of dismissal. Acting on the presumption that Glenn Gos leasing business is a conjugal property, the RTC held that Karen Go had sufficient interest in his leasing business to file the action against Navarro. However, the RTC held that Karen Go should have included her husband, Glenn Go, in the complaint based on Section 4, Rule 3 of the Rules of Court (Rules).12 Thus, the lower court ordered Karen Go to file a motion for the inclusion of Glenn Go as coplaintiff.1avvphi1 When the RTC denied Navarros motion for reconsideration on March 7, 2001, Navarro filed a petition for certiorari with the CA, essentially contending that the RTC committed grave abuse of discretion when it reconsidered the dismissal of the case and directed Karen Go to amend her complaints by including her husband Glenn Go as co-plaintiff. According to Navarro, a complaint which failed to state a cause of action could not be converted into one with a cause of action by mere amendment or supplemental pleading. On October 16, 2001, the CA denied Navarros petition and affirmed the RTCs order.13 The CA also denied Navarros motion for reconsideration in its resolution of

May 29, 2002,14 leading to the filing of the present petition. THE PETITION Navarro alleges that even if the lease agreements were in the name of Kargo Enterprises, since it did not have the requisite juridical personality to sue, the actual parties to the agreement are himself and Glenn Go. Since it was Karen Go who filed the complaints and not Glenn Go, she was not a real party-in-interest and the complaints failed to state a cause of action. Navarro posits that the RTC erred when it ordered the amendment of the complaint to include Glenn Go as a co-plaintiff, instead of dismissing the complaint outright because a complaint which does not state a cause of action cannot be converted into one with a cause of action by a mere amendment or a supplemental pleading. In effect, the lower court created a cause of action for Karen Go when there was none at the time she filed the complaints. Even worse, according to Navarro, the inclusion of Glenn Go as co-plaintiff drastically changed the theory of the complaints, to his great prejudice. Navarro claims that the lower court gravely abused its discretion when it assumed that the leased vehicles are part of the conjugal property of Glenn and Karen Go. Since Karen Go is the registered owner of Kargo Enterprises, the vehicles subject of the complaint are her paraphernal properties and the RTC gravely erred when it ordered the inclusion of Glenn Go as a co-plaintiff. Navarro likewise faults the lower court for setting the trial of the case in the same order that required Karen Go to amend her complaints, claiming that by issuing this order, the trial court violated Rule 10 of the Rules. Even assuming the complaints stated a cause of action against him, Navarro maintains that the complaints were premature because no prior demand was made on him to comply with the provisions of the lease agreements before the complaints for replevin were filed. Lastly, Navarro posits that since the two writs of replevin were issued based on flawed complaints, the vehicles were illegally seized from his possession and should be returned to him immediately. Karen Go, on the other hand, claims that it is misleading for Navarro to state that she has no real interest in the subject of the complaint, even if the lease agreements were signed only by her husband, Glenn Go; she is the owner of Kargo Enterprises and Glenn Go signed the lease agreements merely as the manager of Kargo Enterprises. Moreover, Karen Go maintains that Navarros insistence that Kargo Enterprises is Karen Gos paraphernal property is without basis. Based on the law and jurisprudence on the matter, all property acquired during the marriage is presumed to be conjugal property. Finally, Karen Go insists that her complaints sufficiently established a cause of action against Navarro. Thus,

when the RTC ordered her to include her husband as coplaintiff, this was merely to comply with the rule that spouses should sue jointly, and was not meant to cure the complaints lack of cause of action. THE COURTS RULING We find the petition devoid of merit.

did sign the agreement only as the manager of Kargo Enterprises and the latter is clearly the real party to the lease agreements. As Navarro correctly points out, Kargo Enterprises is a sole proprietorship, which is neither a natural person, nor a juridical person, as defined by Article 44 of the Civil Code: Art. 44. The following are juridical persons:

Karen Go is the real party-in-interest (1) The State and its political subdivisions; The 1997 Rules of Civil Procedure requires that every action must be prosecuted or defended in the name of the real party-in-interest, i.e., 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.15 Interestingly, although Navarro admits that Karen Go is the registered owner of the business name Kargo Enterprises, he still insists that Karen Go is not a real partyin-interest in the case. According to Navarro, while the lease contracts were in Kargo Enterprises name, this was merely a trade name without a juridical personality, so the actual parties to the lease agreements were Navarro and Glenn Go, to the exclusion of Karen Go. As a corollary, Navarro contends that the RTC acted with grave abuse of discretion when it ordered the inclusion of Glenn Go as co-plaintiff, since this in effect created a cause of action for the complaints when in truth, there was none. We do not find Navarros arguments persuasive. The central factor in appreciating the issues presented in this case is the business name Kargo Enterprises. The name appears in the title of the Complaint where the plaintiff was identified as "KAREN T. GO doing business under the name KARGO ENTERPRISES," and this identification was repeated in the first paragraph of the Complaint. Paragraph 2 defined the business KARGO ENTERPRISES undertakes. Paragraph 3 continued with the allegation that the defendant "leased from plaintiff a certain motor vehicle" that was thereafter described. Significantly, the Complaint specifies and attaches as its integral part the Lease Agreement that underlies the transaction between the plaintiff and the defendant. Again, the name KARGO ENTERPRISES entered the picture as this Lease Agreement provides: This agreement, made and entered into by and between: GLENN O. GO, of legal age, married, with post office address at xxx, herein referred to as the LESSOR-SELLER; representing KARGO ENTERPRISES as its Manager, xxx thus, expressly pointing to KARGO ENTERPRISES as the principal that Glenn O. Go represented. In other words, by the express terms of this Lease Agreement, Glenn Go (2) Other corporations, institutions and entities for public interest or purpose, created by law; their personality begins as soon as they have been constituted according to law; (3) Corporations, partnerships and associations for private interest or purpose to which the law grants a juridical personality, separate and distinct from that of each shareholder, partner or member. Thus, pursuant to Section 1, Rule 3 of the Rules,16 Kargo Enterprises cannot be a party to a civil action. This legal reality leads to the question: who then is the proper party to file an action based on a contract in the name of Kargo Enterprises? We faced a similar question in Juasing Hardware v. Mendoza,17 where we said: Finally, there is no law authorizing sole proprietorships like petitioner to bring suit in court. The law merely recognizes the existence of a sole proprietorship as a form of business organization conducted for profit by a single individual, and requires the proprietor or owner thereof to secure licenses and permits, register the business name, and pay taxes to the national government. It does not vest juridical or legal personality upon the sole proprietorship nor empower it to file or defend an action in court. Thus, the complaint in the court below should have been filed in the name of the owner of Juasing Hardware. The allegation in the body of the complaint would show that the suit is brought by such person as proprietor or owner of the business conducted under the name and style Juasing Hardware. The descriptive words "doing business as Juasing Hardware" may be added to the title of the case, as is customarily done.18 [Emphasis supplied.] This conclusion should be read in relation with Section 2, Rule 3 of the Rules, which states: SEC. 2. Parties in interest. A real party in interest is 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. Unless otherwise authorized by law or these Rules, every action must be prosecuted or defended in the name of the real party in interest.

As the registered owner of Kargo Enterprises, Karen Go is the party who will directly benefit from or be injured by a judgment in this case. Thus, contrary to Navarros contention, Karen Go is the real party-in-interest, and it is legally incorrect to say that her Complaint does not state a cause of action because her name did not appear in the Lease Agreement that her husband signed in behalf of Kargo Enterprises. Whether Glenn Go can legally sign the Lease Agreement in his capacity as a manager of Kargo Enterprises, a sole proprietorship, is a question we do not decide, as this is a matter for the trial court to consider in a trial on the merits. Glenn Gos Role in the Case We find it significant that the business name Kargo Enterprises is in the name of Karen T. Go,19 who described herself in the Complaints to be "a Filipino, of legal age, married to GLENN O. GO, a resident of Cagayan de Oro City, and doing business under the trade name KARGO ENTERPRISES."20 That Glenn Go and Karen Go are married to each other is a fact never brought in issue in the case. Thus, the business name KARGO ENTERPRISES is registered in the name of a married woman, a fact material to the side issue of whether Kargo Enterprises and its properties are paraphernal or conjugal properties. To restate the parties positions, Navarro alleges that Kargo Enterprises is Karen Gos paraphernal property, emphasizing the fact that the business is registered solely in Karen Gos name. On the other hand, Karen Go contends that while the business is registered in her name, it is in fact part of their conjugal property. The registration of the trade name in the name of one person a woman does not necessarily lead to the conclusion that the trade name as a property is hers alone, particularly when the woman is married. By law, all property acquired during the marriage, whether the acquisition appears to have been made, contracted or registered in the name of one or both spouses, is presumed to be conjugal unless the contrary is proved.21 Our examination of the records of the case does not show any proof that Kargo Enterprises and the properties or contracts in its name are conjugal. If at all, only the bare allegation of Navarro to this effect exists in the records of the case. As we emphasized in Castro v. Miat:22 Petitioners also overlook Article 160 of the New Civil Code. It provides that "all property of the marriage is presumed to be conjugal partnership, unless it be prove[n] that it pertains exclusively to the husband or to the wife." This article does not require proof that the property was acquired with funds of the partnership.The presumption applies even when the manner in which the property was acquired does not appear.23[Emphasis supplied.] Thus, for purposes solely of this case and of resolving the issue of whether Kargo Enterprises as a sole proprietorship is conjugal or paraphernal property, we hold that it is conjugal property.

Article 124 of the Family Code, on the administration of the conjugal property, provides: Art. 124. The administration and enjoyment of the conjugal partnership property shall belong to both spouses jointly. In case of disagreement, the husbands decision shall prevail, subject to recourse to the court by the wife for proper remedy, which must be availed of within five years from the date of the contract implementing such decision. xxx This provision, by its terms, allows either Karen or Glenn Go to speak and act with authority in managing their conjugal property, i.e., Kargo Enterprises. No need exists, therefore, for one to obtain the consent of the other before performing an act of administration or any act that does not dispose of or encumber their conjugal property. Under Article 108 of the Family Code, the conjugal partnership is governed by the rules on the contract of partnership in all that is not in conflict with what is expressly determined in this Chapter or by the spouses in their marriage settlements. In other words, the property relations of the husband and wife shall be governed primarily by Chapter 4 on Conjugal Partnership of Gains of the Family Code and, suppletorily, by the spouses marriage settlement and by the rules on partnership under the Civil Code. In the absence of any evidence of a marriage settlement between the spouses Go, we look at the Civil Code provision on partnership for guidance. A rule on partnership applicable to the spouses circumstances is Article 1811 of the Civil Code, which states: Art. 1811. A partner is a co-owner with the other partners of specific partnership property. The incidents of this co-ownership are such that: (1) A partner, subject to the provisions of this Title and to any agreement between the partners, has an equal right with his partners to possess specific partnership property for partnership purposes; xxx Under this provision, Glenn and Karen Go are effectively co-owners of Kargo Enterprises and the properties registered under this name; hence, both have an equal right to seek possession of these properties. Applying Article 484 of the Civil Code, which states that "in default of contracts, or special provisions, co-ownership shall be governed by the provisions of this Title," we find further support in Article 487 of the Civil Code that allows any of the co-owners to bring an action in ejectment with respect to the co-owned property. While ejectment is normally associated with actions involving real property, we find that this rule can be applied to the circumstances of the present case,

following our ruling in Carandang v. Heirs of De Guzman.24 In this case, one spouse filed an action for the recovery of credit, a personal property considered conjugal property, without including the other spouse in the action. In resolving the issue of whether the other spouse was required to be included as a co-plaintiff in the action for the recovery of the credit, we said: Milagros de Guzman, being presumed to be a co-owner of the credits allegedly extended to the spouses Carandang, seems to be either an indispensable or a necessary party. If she is an indispensable party, dismissal would be proper. If she is merely a necessary party, dismissal is not warranted, whether or not there was an order for her inclusion in the complaint pursuant to Section 9, Rule 3. Article 108 of the Family Code provides: Art. 108. The conjugal partnership shall be governed by the rules on the contract of partnership in all that is not in conflict with what is expressly determined in this Chapter or by the spouses in their marriage settlements. This provision is practically the same as the Civil Code provision it superseded: Art. 147. The conjugal partnership shall be governed by the rules on the contract of partnership in all that is not in conflict with what is expressly determined in this Chapter. In this connection, Article 1811 of the Civil Code provides that "[a] partner is a co-owner with the other partners of specific partnership property." Taken with the presumption of the conjugal nature of the funds used to finance the four checks used to pay for petitioners stock subscriptions, and with the presumption that the credits themselves are part of conjugal funds, Article 1811 makes Quirino and Milagros de Guzman co-owners of the alleged credit. Being co-owners of the alleged credit, Quirino and Milagros de Guzman may separately bring an action for the recovery thereof. In the fairly recent cases of Baloloy v. Hular and Adlawan v. Adlawan, we held that, in a coownership, co-owners may bring actions for the recovery of co-owned property without the necessity of joining all the other co-owners as co-plaintiffs because the suit is presumed to have been filed for the benefit of his coowners. In the latter case and in that of De Guia v. Court of Appeals, we also held that Article 487 of the Civil Code, which provides that any of the co-owners may bring an action for ejectment, covers all kinds of action for the recovery of possession. In sum, in suits to recover properties, all co-owners are real parties in interest. However, pursuant to Article 487 of the Civil Code and relevant jurisprudence, any one of them may bring an action, any kind of action, for the recovery of co-owned properties. Therefore, only one of the co-owners, namely the co-owner who filed the suit for the recovery of the co-owned property, is an indispensable party thereto. The other co-owners are not

indispensable parties. They are not even necessary parties, for a complete relief can be accorded in the suit even without their participation, since the suit is presumed to have been filed for the benefit of all coowners.25[Emphasis supplied.] Under this ruling, either of the spouses Go may bring an action against Navarro to recover possession of the Kargo Enterprises-leased vehicles which they co-own. This conclusion is consistent with Article 124 of the Family Code, supporting as it does the position that either spouse may act on behalf of the conjugal partnership, so long as they do not dispose of or encumber the property in question without the other spouses consent. On this basis, we hold that since Glenn Go is not strictly an indispensable party in the action to recover possession of the leased vehicles, he only needs to be impleaded as a pro-forma party to the suit, based on Section 4, Rule 4 of the Rules, which states: Section 4. Spouses as parties. Husband and wife shall sue or be sued jointly, except as provided by law. Non-joinder of indispensable parties not ground to dismiss action Even assuming that Glenn Go is an indispensable party to the action, we have held in a number of cases26 that the misjoinder or non-joinder of indispensable parties in a complaint is not a ground for dismissal of action. As we stated in Macababbad v. Masirag:27 Rule 3, Section 11 of the Rules of Court provides that neither misjoinder nor nonjoinder of parties is a ground for the dismissal of an action, thus: Sec. 11. Misjoinder and non-joinder of parties. Neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately. In Domingo v. Scheer, this Court held that the proper remedy when a party is left out is to implead the indispensable party at any stage of the action. The court, either motu proprio or upon the motion of a party, may order the inclusion of the indispensable party or give the plaintiff opportunity to amend his complaint in order to include indispensable parties. If the plaintiff to whom the order to include the indispensable party is directed refuses to comply with the order of the court, the complaint may be dismissed upon motion of the defendant or upon the court's own motion. Only upon unjustified failure or refusal to obey the order to include or to amend is the action dismissed. In these lights, the RTC Order of July 26, 2000 requiring plaintiff Karen Go to join her husband as a party plaintiff is fully in order.

Demand not required prior to filing of replevin action In arguing that prior demand is required before an action for a writ of replevin is filed, Navarro apparently likens a replevin action to an unlawful detainer. For a writ of replevin to issue, all that the applicant must do is to file an affidavit and bond, pursuant to Section 2, Rule 60 of the Rules, which states: Sec. 2. Affidavit and bond. The applicant must show by his own affidavit or that of some other person who personally knows the facts: (a) That the applicant is the owner of the property claimed, particularly describing it, or is entitled to the possession thereof; (b) That the property is wrongfully detained by the adverse party, alleging the cause of detention thereof according to the best of his knowledge, information, and belief; (c) That the property has not been distrained or taken for a tax assessment or a fine pursuant to law, or seized under a writ of execution or preliminary attachment, or otherwise placed under custodia legis, or if so seized, that it is exempt from such seizure or custody; and (d) The actual market value of the property. The applicant must also give a bond, executed to the adverse party in double the value of the property as stated in the affidavit aforementioned, for the return of the property to the adverse party if such return be adjudged, and for the payment to the adverse party of such sum as he may recover from the applicant in the action. We see nothing in these provisions which requires the applicant to make a prior demand on the possessor of the property before he can file an action for a writ of replevin. Thus, prior demand is not a condition precedent to an action for a writ of replevin. More importantly, Navarro is no longer in the position to claim that a prior demand is necessary, as he has already admitted in his Answers that he had received the letters that Karen Go sent him, demanding that he either pay his unpaid obligations or return the leased motor vehicles. Navarros position that a demand is necessary and has not been made is therefore totally unmeritorious. WHEREFORE, premises considered, we DENY the petition for review for lack of merit. Costs against petitioner Roger V. Navarro. SO ORDERED.

quieting of title, declaration of nullity of documents, recovery of possession, and damages. Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 173192 April 14, 2008 The therein plaintiffs-herein respondents Maximo and Flaviano claimed that they are children of the deceased co-owner Simplicio; that respondents Gaudencio and Domingo are children of the deceased co-owner Ignacio; and that respondent Victoria and respondent Lilia P. Gabison (Lilia) are grandchildren of the late coowner Fortunata.3 Respondents also alleged that the therein defendantspetitioners Rosendo and Rodrigo are heirs of Alipio Bacalso, Sr. (Alipio, Sr.) who, during his lifetime, secured Tax Declaration Nos. L-078-02223 and L-078-02224 covering the lot without any legal basis; that Rosendo and Rodrigo have been leasing portions of the lot to persons who built houses thereon, and Rosendo has been living in a house built on a portion of the lot;4 and that demands to vacate and efforts at conciliation proved futile,5 prompting them to file the complaint at the RTC. In their Answer6 to the complaint, petitioners Rosendo and Rodrigo claimed that their father Alipio, Sr. purchased via deeds of sale the shares in the lot of Fortunata, Simplicio, Wenceslao, Geronimo, and Felix from their respective heirs, and that Alipio, Sr. acquired the shares of the other co-owners of the lot by extraordinary acquisitive prescription through continuous, open, peaceful, and adverse possession thereof in the concept of an owner since 1949.7 By way of Reply and Answer to the Defendants' Counterclaim,8 herein respondents Gaudencio, Maximo, Flaviano, Domingo, and Victoria alleged that the deeds of sale on which Rosendo and Rodrigo base their claim of ownership of portions of the lot are spurious, but assuming that they are not, laches had set in against Alipio, Sr.; and that the shares of the other co-owners of the lot cannot be acquired through laches or prescription. Gaudencio, Maximo, Flaviano, Domingo, and Victoria, with leave of court,9 filed an Amended Complaint10impleading as additional defendants Alipio, Sr.'s other heirs, namely, petitioners Marceliana11 Doblas, Terolio Bacalso, Alipio Bacalso, Jr., Mario Bacalso, William Bacalso, Alipio Bacalso III, and Christine B. Baes.12 Still later, Gaudencio et al. filed a Second Amended Complaint13 with leave of court,14 impleading as additional plaintiffs the other heirs of registered co-owner Maximiano, namely, herein respondents Timoteo Padigos, Perfecto Padigos, Frisca15 Salarda, Flora Quinto (sometimes rendered as "Guinto"), Benita Templa, Sotero Padigos, Andres Padigos, and Emilio Padigos.16 In their Answer to the Second Amended Complaint,17 petitioners contended that the Second Amended Complaint should be dismissed in view of the failure to implead other heirs of the other registered owners of the lot who are indispensable parties.18 A Third Amended Complaint19 was thereafter filed with leave of court20 impleading as additional plaintiffs the

ROSENDO BACALSO, RODRIGO BACALSO, MARCILIANA B. DOBLAS, TEROLIO BACALSO, ALIPIO BACALSO, JR., MARIO BACALSO, WILLIAM BACALSO, ALIPIO BACALSO III and CRISTITA B. BAES,petitioners, vs. MAXIMO PADIGOS, FLAVIANO MABUYO, GAUDENCIO PADIGOS, DOMINGO PADIGOS, VICTORIA P. ABARQUEZ, LILIA P. GABISON, TIMOTEO PADIGOS, PERFECTO PADIGOS, PRISCA SALARDA, FLORA GUINTO, BENITA TEMPLA, SOTERO PADIGOS, ANDRES PADIGOS, EMILIO PADIGOS, DEMETRIO PADIGOS, JR., WENCESLAO PADIGOS, NELLY PADIGOS, EXPEDITO PADIGOS, HENRY PADIGOS and ENRIQUE P. MALAZARTE, respondents. DECISION CARPIO MORALES, J.: The case at bar involves a parcel of land identified as Lot No. 3781 (the lot) located in Inayawan, Cebu, covered by Original Certificate of Title No. RO-2649 (0-9092)1 in the name of the following 13 co-owners, their respective shares of which are indicated opposite their names: Fortunata Padigos (Fortunata) Felix Padigos (Felix) Wenceslao Padigos (Wenceslao) Maximiano Padigos (Maximiano) Geronimo Padigos (Geronimo) Macaria Padigos Simplicio Padigos (Simplicio) Ignacio Padigos (Ignacio) Matilde Padigos Marcelo Padigos Rustica Padigos Raymunda Padigos Antonino Padigos 1/8 1/8 1/8 1/8 1/8 1/8 1/8 1/48 1/48 1/48 1/48 1/48 1/48

Maximo Padigos (Maximo), Flaviano Mabuyo (Flaviano), Gaudencio Padigos (Gaudencio), Domingo Padigos (Domingo), and Victoria P. Abarquez (Victoria), who are among the herein respondents, filed on April 17, 1995, before the Regional Trial Court (RTC) of Cebu City, a Complaint,2 docketed as Civil Case No. CEB-17326, against Rosendo Bacalso (Rosendo) and Rodrigo Bacalso (Rodrigo) who are among the herein petitioners, for

heirs of Wenceslao, namely, herein respondents Demetrio Padigos, Jr., Wenceslao Padigos, and Nelly Padigos, and the heirs of Felix, namely, herein respondents Expedito Padigos (Expedito), Henry Padigos, and Enrique P. Malazarte.21 After trial, Branch 16 of the Cebu City RTC decided22 in favor in the therein plaintiffs-herein respondents, disposing as follows: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendants. 1. Declaring the plaintiffs to be entitled to the ownership and possession of the lot in litigation; 2. Declaring as null and void the Deeds of Absolute Sale in question; 3. Ordering the defendants to pay plaintiffs the sum of P50,000.00 as actual and compensatory damages[,] the sum of P20,000.00 as attorney's fees, and P10,000.00 as litigation expenses. 4. Ordering the defendants to pay the costs of suit. SO ORDERED.23 (Emphasis in the original; underscoring supplied) The defendants-herein petitioners Bacalsos appealed.24 Meanwhile, the trial court, on respondents' Motion for Execution Pending Appeal,25 issued a writ of execution which was implemented by, among other things, demolishing the houses constructed on the lot.26 By Decision27 of September 6, 2005, the Court of Appeals affirmed the trial court's decision. Their Motion for Reconsideration28 having been denied,29 petitioners filed the present Petition for Review on Certiorari,30 faulting the Court of Appeals: . . . when it ruled that the Second Amended Complaint is valid and legal, even if not all indispensable parties are impleaded or joined . . . . . . when [it] wittingly overlooked the most potent, unescapable and indubitable fact or circumstance which proved the continuous possession of Lot No. 3781 by the defendants and their predecessors in interest, Alipio Bacalso [Sr.] and/or when it sanctioned impliedly the glaring arbitrary RTC order of the demolition of the over 40 years old houses, situated on Lot No. 3781 Cebu Cad., belonging to the old lessees, long allowed to lease or stay thereat for many years, by Alipio Bacalso [Sr.], father and [predecessor] in interest of the defendants, now the herein Petitioners. The said lessees were not even joined as parties in this case, much less were they given a chance to air their side before

their houses were demolished, in gross violation of the due process clause provided for in Sec. 1[,] Art. III of the Constitution . . . . . . in upholding as gospel truth the report and conclusion of Nimrod Vao, the supposed handwriting expert[,] that signatures and thumb marks appearing on all documents of sale presented by the defendants are forgeries, and not mindful that Nimrod Vao was not crossexamined thoroughly by the defense counsel as he was prevented from doing so by the trial judge, in violation of the law more particularly Sec. 6, Rule 132, Rules of Court and/or the accepted and usual course of judicial proceedings and is therefore not admissible in evidence. . . . [when it] . . . wittingly or unwittingly, again overlooked the vital facts, the circumstances, the laws and rulings of the Supreme Court, which are of much weight, substance and influence which, if considered carefully, undoubtedly uphold that the defendants and their predecessors in interests, have long been in continuous, open, peaceful and adverse, and notorious possession against the whole world of Lot No. 3781, Cebu Cad., in concept of absolute owners for 46 years, a period more than sufficient to sustain or uphold the defense of prescription, provided for in Art. 1137 of the Civil Code even without good faith.31 (Emphasis and underscoring in the original; italics supplied) Respondents admit that Teodulfo Padigos (Teodulfo), an heir of Simplicio, was not impleaded.32 They contend, however, that the omission did not deprive the trial court of jurisdiction because Article 487 of the Civil Code states that "[a]ny of the co-owners may bring an action in ejectment."33 Respondents' contention does not lie. The action is for quieting of title, declaration of nullity of documents, recovery of possession and ownership, and damages. Arcelona v. Court of Appeals34 defines indispensable parties under Section 7 of Rule 3, Rules of Court as follows: [P]arties-in-interest without whom there can be no final determination of an action. As such, they must be joined either as plaintiffs or as defendants. The general rule with reference to the making of parties in a civil action requires, of course, the joinder of all necessary parties where possible, and the joinder of all indispensable parties under any and all conditions, their presence being a 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." The absence of an indispensable party renders all subsequent actions of the court null and voidfor want of

authority to act, not only as to the absent parties but even as to those present. Petitioners are co-owners of a fishpond . . . The fishpond is undivided; it is impossible to pinpoint which specific portion of the property is owned by Olanday, et. al. and which portion belongs to petitioners. x x x Indeed, petitioners should have been properly impleaded as indispensable parties. x x x x x x x35 (Underscoring supplied) The absence then of an indispensable party renders all subsequent actions of a court null and void for want of authority to act, not only as to the absent party but even as to those present.36 Failure to implead indispensable parties aside, the resolution of the case hinges on a determination of the authenticity of the documents on which petitioners in part anchor their claim to ownership of the lot. The questioned documents are: 1. Exhibit "3" a notarized Deed of Sale executed by Gaudencio, Domingo, a certain Hermenegilda Padigos, and the heirs of Fortunata, in favor of Alipio, Sr. on June 8, 1959; 2. Exhibit "4" a notarized Deed of Sale executed on September 9, 1957 by Gavino Padigos (Gavino), alleged son of Felix, in favor of Alipio Gadiano; 3. Exhibit "5" a private deed of sale executed in June 1957 by Macaria Bongalan, Marciano Padigos, and Dominga Padigos, supposed heirs of Wenceslao, in favor of Alipio, Sr.; 4. Exhibit "6" a notarized deed of sale executed on September 9, 1957 by Gavino and Rodulfo Padigos, heirs of Geronimo, in favor of Alipio Gadiano; 5. Exhibit "7" a notarized deed of sale executed on March 19, 1949 by Irenea Mabuyo, Teodulfo and Maximo, heirs of Simplicio; 6. Exhibit "8" a private deed of sale executed on May 3, 1950 by Candido Padigos, one of Simplicio's children, in favor of Alipio, Sr.; and 7. Exhibit "9" a notarized deed of sale executed on May 17, 1957 by Alipio Gadiano in favor of Alipio, Sr. Exhibits "3," "4," "6," "7," and "8," which are notarized documents, have in their favor the presumption of regularity.37

Forgery, as any other mechanism of fraud, must be proved clearly and convincingly, and the burden of proof lies on the party alleging forgery.38 The trial court and the Court of Appeals relied on the findings of Nimrod Bernabe Vao (Vao), expert witness for respondents, that Gaudencio's signature on Exhibit "3" (Deed of Absolute Sale covering Fortunata's share in the lot) and Maximo's thumbprint on Exhibit "7" (Deed of Sale covering Simplicio's share in the lot) are spurious.39Vao's findings were presented by respondents to rebut those of Wilfredo Espina (Espina), expert witness for petitioners, that Gaudencio's signature and Maximo's thumbprint are genuine.40 Expert opinions are not ordinarily conclusive. They are generally regarded as purely advisory in character.41 The courts may place whatever weight they choose upon and may reject them, if they find them inconsistent with the facts in the case or otherwise unreasonable.42 When faced with conflicting expert opinions, courts give more weight and credence to that which is more complete, thorough, and scientific.43 The Court observes that in examining the questioned signatures of respondent Gaudencio, petitioners' expert witness Espina used as standards 15 specimen signatures which have been established to be Gaudencio's,44 and that after identifying similarities between the questioned signatures and the standard signatures, he concluded that the questioned signatures are genuine. On the other hand, respondents' expert witness Vao used, as standards, the questioned signatures themselves.45 He identified characteristics of the signatures indicating that they may have been forged. Vao's statement of the purpose of the examination is revealing: x x x [t]o x x x discover, classify and determine the authenticity of every document that for any reason requires examination be [sic] scrutinized in every particular that may possibly throw any light upon its origin, its age or upon quality element or condition that may have a bearing upons [sic] its genuineness or spuriousness.46 (Emphasis supplied) The Court also notes that Vao also analyzed the signatures of the witnesses to the questioned documents, the absence of standard specimens with which those signatures could be compared notwithstanding.47 On the other hand, Espina refrained from making conclusions on signatures which could not be compared with established genuine specimens.48 Specifically with respect to Vao's finding that Maximo's thumbprint on Exhibit "7" is spurious, the Court is not persuaded, no comparison having been made of such thumbprint with a genuine thumbprint established to be Maximo's.49 Vao's testimony should be received with caution, the trial court having abruptly cut short his cross-examination conducted by petitioners' counsel,50 thus:

COURT: You are just delaying the proceedings in this case if you are going to ask him about the documents one by one. Just leave it to the Court to determine whether or not he is a qualified expert witness. The Court will just go over the Report of the witness. You do not have to ask the witness one by one on the document,51 thereby depriving this Court of the opportunity to determine his credibility. Espina, on the other hand, withstood thorough cross-examination, re-direct and recross examination.52 The value of the opinion of a handwriting expert depends not upon his mere statements of whether a writing is genuine or false, but upon the assistance he may afford in pointing out distinguishing marks, characteristics and discrepancies in and between genuine and false specimens of writing which would ordinarily escape notice or detection from an unpracticed observer.53 While differences exist between Gaudencio's signatures appearing on Exhibits "3"-"3-D" and his signatures appearing on the affidavits accompanying the pleadings in this case,54 the gap of more than 30 years from the time he affixed his signatures on the questioned document to the time he affixed his signatures on the pleadings in the case could explain the difference. Thus Espina observed: xxxx 4. Both questioned and standard signatures exhibited the same style and form of the movement impulses in its execution; 5. Personal habits of the writer were established in both questioned and standard signatures such as misalignment of the whole structure of the signature, heavy penpressure [sic] of strokes from initial to the terminal, formation of the loops and ovals, poor line quality and spacing between letters are all repeated; 6. Both questioned and standard signatures [show] no radical change in the strokes and letter formation in spite o[f] their wide difference in dates of execution considering the early writing maturity of the writer; 7. Variations in both writings questioned and standards were considered and properly evaluated. xxxx Fundamental similarities are observed in the following characteristics to wit:

xxxx SIGNATURES 1. Ovals of "a" either rounded or angular at the base; 2. Ovals of "d" either narrow, rounded, or angular at the base; 3. Loop stems of "d" consistently tall and retraced in both specimens questioned and standards; 4. Base alignment of "e" and "i" are repeated with sameness; 5. Top of "c" either with a retrace, angular formation or an eyelet; 6. Terminal ending of "o" heavy with a short tapering formation; 7. Loop stem of "P" with wide space and angular; 8. Oval of "P" either rounded or multi-angular; 9. Base loop of "g" consistently short either a retrace, a blind loop or narrow space disproportionate to the top oval; 10. Angular top of "s" are repeated with sameness; 11. Terminal ending of "s" short and heavy with blind loop or retrace at the base. 55 And Espina concluded xxxx [t]hat the four (4) questioned signatures over and above the typewritten name and word GAUDENCIO PADIGOS Vendor on four copies of a DEED OF ABSOLUTE SALE (original and carbon) dated June 8, 1959 were written, signed, and prepared by the hand who wrote the standard specimens Exh. "G" and other specimen materials collected from the records of this case that were submitted or comparison; a product of one Mind and Brain hence GENUINE and AUTHENTIC.56 (Emphasi s in the original; underscoring supplied) Respondents brand Maximo's thumbmark on Exhibit "7" as spurious because, so they claim, Maximo did not affix his signature thru a thumbmark, he knowing how to write.57 Such conclusion is a non sequitur, however, for a person who knows how to write is not precluded from signing by thumbmark.

In affirming the nullification by the trial court of Exhibits "3," "4," "5," "6," "7," and "8," the Court of Appeals held: xxxx First of all, facts about pedigree of the registered owners and their lawful heirs were convincingly testified to by plaintiff-appellant Gaudencio Padigos and his testimony remained uncontroverted. xxxx Giving due weight to his testimony, we find that x x x the vendors in the aforesaid Deeds of Sale x x x were not the legal heirs of the registered owners of the disputed land. x x x xxxx As for Exhibit "4," the vendor Gavino Padigos is not a legal heir of the registered owner Felix Padigos. The latter's heirs are plaintiff-appellants Expedito Padigos, Henry Padigos and Enrique P. Malazarte. Accordingly, Exhibit "4" is a patent nullity and did not vest title of Felix Padigos' share of Lot 3781 to Alipio [Gadiano]. As for Exhibit "6," the vendors Gavino and Rodulfo Padigos are not the legal heirs of the registered ownerGeronimo Padigos. Therefore, these fictitious heirs could not validly convey ownership in favor of Alipio [Gadiano]. xxxx As for Exhibit "8," the vendor Candido Padigos is not a legal heir of Simplicio Padigos. Therefore, the former could not vest title of the land to Alipio Bacalso. As for Exhibit "3," the vendors Gaudencio Padigos, Hermenegilda Padigos and Domingo Padigos are not the legal heirs of registered owner Fortunata Padigos. Hermenegilda Padigos is not a known heir of any of the other registered owners of the property. On the other hand, plaintiffs-appellants Gaudencio and Domingo Padigos are only some of the collateral grandchildren of Fortunata Padigos. They could not by themselves dispose of the share of Fortunata Padigos. xxxx As for Exhibit "5," the vendors in Exhibit "5" are not the legal heirs of Wenceslao Padigos. The children of registered owner Wenceslao Padigos are: Wenceslao Padigos, Demetrio Padigos and Nelly Padigos. Therefore, Exhibit "5" is null and

void and could not convey the shares of the registered owner Wenceslao Padigos in favor of Alipio Bacalso. As for Exhibit "9," the Deed of Sale executed by Alipio [Gadiano] in favor of Alipio Bacalso is also void because the shares of the registered owners Felix and Geronimo Padigos were not validly conveyed to Alipio [Gadiano] because Exhibit "4" and "6" were void contracts. Thus, Exhibit "9" is also null and void.58(Italics in the original; underscoring supplied) The evidence regarding the "facts of pedigree of the registered owners and their heirs" does not, however, satisfy this Court. Not only is Gaudencio's self-serving testimony uncorroborated; it contradicts itself on material points. For instance, on direct examination, he testified that Ignacio is his father and Fortunata is his grandmother.59 On cross-examination, however, he declared that his father Ignacio is the brother of Fortunata.60 On direct examination, he testified that his co-plaintiffs Victoria and Lilia are already dead.61 On cross-examination, however, he denied knowledge whether the two are already dead.62 Also on direct examination, he identified Expedito, Henry, and Enrique as the children of Felix.63 Expedito himself testified, however, that he is the son of a certain Mamerto Padigos, the son of a certain Apolonio Padigos who is in turn the son of Felix.64 At all events, respondents are guilty of laches the negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it has either abandoned it or declined to assert it.65While, by express provision of law, no title to registered land in derogation of that of the registered owner shall be acquired by prescription or adverse possession, it is an enshrined rule that even a registered owner may be barred from recovering possession of property by virtue of laches.66 Respondents insist, however, that they only learned of the deeds of sale in 1994, the year that Alipio, Sr. allegedly commenced possession of the property.67 The record shows, however, that although petitioners started renting out the land in 1994, they have been tilling it since the 1950s,68 and Rosendo's house was constructed in about 1985.69 These acts of possession could not have escaped respondents' notice given the following unassailed considerations, inter alia: Gaudencio testified that he lived on the lot from childhood until 1985, after which he moved to a place three kilometers away, and after he moved, a certain Vicente Debelos lived on the lot with his permission.70 Petitioners' witness Marina Alcoseba, their employee,71 testified that Gaudencio and Domingo used to cut kumpay planted by petitioners' tenant on the lot.72 The tax declarations in Alipio, Sr.'s name for the years 1967-1980 covering a portion of the lot indicate Fortunata's share to be the north and east boundaries of Alipio, Sr.'s;73 hence, respondents could not have been unaware of the acts of possession that petitioners exercised over the lot.

Upon the other hand, petitioners have been vigilant in protecting their rights over the lot, which their predecessor-in-interest Alipio, Sr. had declared in his name for tax purposes as early as 1960, and for which he had been paying taxes until his death in 1994, by continuing to pay the taxes thereon.74 Respondents having failed to establish their claim by preponderance of evidence, their action for quieting of title, declaration of nullity of documents, recovery of possession, and damages must fail. A final word. While petitioners' attribution of error to the appellate court's "implied sanction" of the trial court's order for the demolition pending appeal of the houses of their lessees is well taken, the Court may not consider any grant of relief to them, they not being parties to the case. WHEREFORE, the petition is GRANTED. The September 6, 2005 decision of the Court of Appeals is REVERSEDand SET ASIDE. Civil Case No. CEB-17326 of Branch 16 of the Regional Trial Court of Cebu City is DISMISSED. SO ORDERED.

SECOND DIVISION G.R. No. 177429 November 24, 2009

alleging among others that she held a copy of the supposedly missing affidavit of Juanito who was merely an agricultural tenant of the land covered by Tax Declaration 463. He surrendered and waived in that affidavit his occupation and tenancy rights to Tallorin and the others in consideration of P29,240.00. Tallorin also put up the affirmative defenses of non-compliance with the requirement of conciliation proceedings and prescription. On March 12, 1998 the RTC set Tallorins affirmative defenses for hearing5 but the Taronas sought reconsideration, pointing out that the trial court should have instead declared Tallorin in default based on their earlier motion.6 On June 2, 1998 the RTC denied the Taronas motion for reconsideration7 for the reasons that it received Tallorins answer before it could issue a default order and that the Taronas failed to show proof that Tallorin was notified of the motion three days before the scheduled hearing. Although the presiding judge inhibited himself from the case on motion of the Taronas, the new judge to whom the case was re-raffled stood by his predecessors previous orders. By a special civil action for certiorari before the Court of Appeals (CA),8 however, the Taronas succeeded in getting the latter court to annul the RTCs March 12 and June 2, 1998 orders.9 The CA ruled that the RTC gravely abused its discretion in admitting Tallorins late answer in the absence of a motion to admit it. Even if petitioner Tallorin had already filed her late answer, said the CA, the RTC should have heard the Taronas motion to declare Tallorin in default. Upon remand of the case, the RTC heard the Taronas motion to declare Tallorin in default,10 granted the same, and directed the Taronas to present evidence ex parte.11 On January 30, 2002 the RTC rendered judgment, a) annulling the tax declaration in the names of Tallorin, Margarita Pastelero Vda. de Valdez, and Dolores Valdez; b) reinstating the tax declaration in the name of Juanito; and c) ordering the issuance in its place of a new tax declaration in the names of Juanitos heirs. The trial court also ruled that Juanitos affidavit authorizing the transfer of the tax declaration had no binding force since he did not sign it.1avvphi1 Tallorin appealed the above decision to the CA,12 pointing out 1) that the land covered by the tax declaration in question was titled in her name and in those of her two co-owners; 2) that Juanitos affidavit only dealt with the surrender of his tenancy rights and did not serve as basis for canceling Tax Declaration 463 in his name; 3) that, although Juanito did not sign the affidavit, he thumbmarked and acknowledged the same before a notary public; and 4) that the trial court erred in not dismissing the complaint for failure to implead Margarita Pastelero Vda. de Valdez and Dolores Valdez who were indispensable parties in the action to annul Juanitos affidavit and the tax declaration in their favor.13 On May 22, 2006 the CA rendered judgment, affirming the trial courts decision.14 The CA rejected all of Tallorins

ANICIA VALDEZ-TALLORIN, Petitioner, vs. HEIRS OF JUANITO TARONA, Represented by CARLOS TARONA, ROGELIO TARONA and LOURDES TARONA, Respondents. DECISION ABAD, J.: This case is about a courts annulment of a tax declaration in the names of three persons, two of whom had not been impleaded in the case, for the reason that the document was illegally issued to them. The Facts and the Case On February 9, 1998 respondents Carlos, Rogelio, and Lourdes Tarona (the Taronas) filed an action before the Regional Trial Court (RTC) of Balanga, Bataan,1 against petitioner Anicia Valdez-Tallorin (Tallorin) for the cancellation of her and two other womens tax declaration over a parcel of land. The Taronas alleged in their complaint that, unknown to them, in 1981, the Assessors Office of Morong in Bataan cancelled Tax Declaration 463 in the name of their father, Juanito Tarona (Juanito), covering 6,186 square meters of land in Morong, Bataan. The cancellation was said to be based on an unsigned though notarized affidavit that Juanito allegedly executed in favor of petitioner Tallorin and two others, namely, Margarita Pastelero Vda. de Valdez and Dolores Valdez, who were not impleaded in the action. In place of the cancelled one, the Assessors Office issued Tax Declaration 6164 in the names of the latter three persons. The old man Taronas affidavit had been missing and no copy could be found among the records of the Assessors Office.2 The Taronas further alleged that, without their fathers affidavit on file, it followed that his tax declaration had been illegally cancelled and a new one illegally issued in favor of Tallorin and the others with her. The unexplained disappearance of the affidavit from official files, the Taronas concluded, covered-up the falsification or forgery that caused the substitution.3 The Taronas asked the RTC to annul Tax Declaration 6164, reinstate Tax Declaration 463, and issue a new one in the name of Juanitos heirs. On March 6, 1998 the Taronas filed a motion to declare petitioner Tallorin in default for failing to answer their complaint within the allowed time.4 But, before the RTC could act on the motion, Tallorin filed a belated answer,

arguments. Since she did not assign as error the order declaring her in default and since she took no part at the trial, the CA pointed out that her claims were in effect mere conjectures, not based on evidence of record.15Notably, the CA did not address the issue Tallorin raised regarding the Taronas failure to implead Margarita Pastelero Vda. de Valdez and Dolores Valdez as indispensable party-defendants, their interest in the cancelled tax declarations having been affected by the RTC judgment. Questions Presented The petition presents the following questions for resolution by this Court: 1. Whether or not the CA erred in failing to dismiss the Taronas complaint for not impleading Margarita Pastelero Vda. de Valdez and Dolores Valdez in whose names, like their co-owner Tallorin, the annulled tax declaration had been issued; 2. Whether or not the CA erred in not ruling that the Taronas complaint was barred by prescription; and 3. Whether or not the CA erred in affirming the RTCs finding that Juanitos affidavit had no legal effect because it was unsigned; when at the hearing of the motion to declare Tallorin in default, it was shown that the affidavit bore Juanitos thumbmark. The Courts Rulings The first question, whether or not the CA erred in failing to dismiss the Taronas complaint for not impleading Margarita Pastelero Vda. de Valdez and Dolores Valdez in whose names, like their co-owner Tallorin, the annulled tax declaration had been issued, is a telling question. The rules mandate the joinder of indispensable parties. Thus: Sec. 7. Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs and defendants.16 Indispensable parties are those with such an interest in the controversy that a final decree would necessarily affect their rights, so that the courts cannot proceed without their presence.17 Joining indispensable parties into an action is mandatory, being a requirement of due process. Without their presence, the judgment of the court cannot attain real finality. Judgments do not bind strangers to the suit. The absence of an indispensable party renders all subsequent actions of the court null and void. Indeed, it would have no authority to act, not only as to the absent party, but as to

those present as well. And where does the responsibility for impleading all indispensable parties lie? It lies in the plaintiff.18 Here, the Taronas sought the annulment of the tax declaration in the names of defendant Tallorin and two others, namely, Margarita Pastelero Vda. de Valdez and Dolores Valdez and, in its place, the reinstatement of the previous declaration in their father Juanitos name. Further, the Taronas sought to strike down as void the affidavit in which Juanito renounced his tenancy right in favor of the same three persons. It is inevitable that any decision granting what the Taronas wanted would necessarily affect the rights of such persons to the property covered by the tax declaration. The Court cannot discount the importance of tax declarations to the persons in whose names they are issued. Their cancellation adversely affects the rights and interests of such persons over the properties that the documents cover. The reason is simple: a tax declaration is a primary evidence, if not the source, of the right to claim title of ownership over real property, a right enforceable against another person. The Court held in Uriarte v. People19 that, although not conclusive, a tax declaration is a telling evidence of the declarants possession which could ripen into ownership. In Director of Lands v. Court of Appeals,20 the Court said that no one in his right mind would pay taxes for a property that he did not have in his possession. This honest sense of obligation proves that the holder claims title over the property against the State and other persons, putting them on notice that he would eventually seek the issuance of a certificate of title in his name. Further, the tax declaration expresses his intent to contribute needed revenues to the Government, a circumstance that strengthens his bona fide claim to ownership.21 Here, the RTC and the CA annulled Tax Declaration 6164 that belonged not only to defendant Tallorin but also to Margarita Pastelero Vda. de Valdez and Dolores Valdez, which two persons had no opportunity to be heard as they were never impleaded. The RTC and the CA had no authority to annul that tax declaration without seeing to it that all three persons were impleaded in the case. But the Taronas action cannot be dismissed outright. As the Court held in Plasabas v. Court of Appeals,22 the nonjoinder of indispensable parties is not a ground for dismissal. Section 11, Rule 3 of the 1997 Rules of Civil Procedure prohibits the dismissal of a suit on the ground of non-joinder or misjoinder of parties and allows the amendment of the complaint at any stage of the proceedings, through motion or on order of the court on its own initiative. Only if plaintiff refuses to implead an indispensable party, despite the order of the court, may it dismiss the action. There is a need, therefore, to remand the case to the RTC with an order to implead Margarita Pastelero Vda. de Valdez and Dolores Valdez as defendants so they may, if they so desire, be heard.

In view of the Courts resolution of the first question, it would serve no purpose to consider the other questions that the petition presents. The resolution of those questions seems to depend on the complete evidence in the case. This will not yet happen until all the indispensable party-defendants are impleaded and heard on their evidence. WHEREFORE, the Court GRANTS the petition and SETS ASIDE the decision of the Regional Trial Court of Balanga, Bataan in Civil Case 6739 dated January 30, 2002 and the decision of the Court of Appeals in CA-G.R. CV 74762 dated May 22, 2006. The Court REMANDS the case to the Regional Trial Court of Balanga, Bataan which is DIRECTED to have Margarita Pastelero Vda. de Valdez and Dolores Valdez impleaded by the plaintiffs as partydefendants and, afterwards, to hear the case in the manner prescribed by the rules. SO ORDERED. ROBERTO A. ABAD Associate Justice WE CONCUR: