Civpro III

Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-21450 April 15, 1968
SERAFN T!AM, ET AL., plaintiffs-appellees,
vs.
MAG"ALENO S#ONG$ANO% &li&' GA(NO
S#ONG$ANO% &)* LUCA #AGUO, defendants,
MANLA SURET% AN" F"ELT% CO., NC. +CE#U
#RANC$, bonding company and defendant-
appellant.
F. S. Urot and G. A. Uriate for plaintiffs-appellees.
Carlos J. Cuizon for defendants Gavino Sibonghanoy
and Lucia aguio.
!illaluz La" #ffice$ !elasco La" #ffice$ %ages and
Soberano for defendant-appellant &anila Surety and
Fidelity Co'pany$ (nc.
"-ON, J.:
n !uly "#, "#$% & ba'ely one month afte' the
effectivity of Republic Act No. (#) *no+n as the
!udicia'y Act of "#$% & the spouses ,e'afin -i.am
and /elicitas -agalog commenced Civil Case No. R-
))0 in the Cou't of /i'st 1nstance of Cebu against the
spouses Magdaleno ,ibonghanoy and 2ucia Baguio
to 'ecove' f'om them the sum of P",#0%.00, +ith legal
inte'est the'eon f'om the date of the filing of the
complaint until the +hole obligation is paid, plus costs.
As p'ayed fo' in the complaint, a +'it of attachment
+as issued by the cou't against defendants3
p'ope'ties, but the same +as soon dissolved upon the
filing of a counte'-bond by defendants and the Manila
,u'ety and /idelity Co., 1nc. he'einafte' 'efe''ed to as
the ,u'ety, on the 4"st of the same month.
Afte' being duly se'ved +ith summons the defendants
filed thei' ans+e' in +hich, afte' ma*ing some
admissions and denials of the mate'ial ave'ments of
the complaint, they inte'posed a counte'claim. -his
counte'claim +as ans+e'ed by the plaintiffs.
Afte' t'ial upon the issues thus .oined, the Cou't
'ende'ed .udgment in favo' of the plaintiffs and, afte'
the same had become final and e5ecuto'y, upon
motion of the latte', the Cou't issued a +'it of
e5ecution against the defendants. -he +'it having
been 'etu'ned unsatisfied, the plaintiffs moved fo' the
issuance of a +'it of e5ecution against the ,u'ety3s
bond 6Rec. on Appeal, pp. $)-$#7, against +hich the
,u'ety filed a +'itten opposition 6(d. pp. $#7 upon t+o
g'ounds, namely, 6"7 /ailu'e to p'osecute and 6(7
Absence of a demand upon the ,u'ety fo' the
payment of the amount due unde' the .udgment.
8pon these g'ounds the ,u'ety p'ayed the Cou't not
only to deny the motion fo' e5ecution against its
counte'-bond but also the follo+ing affir'ative relief 9
:to 'elieve the he'ein bonding company of its liability,
if any, unde' the bond in ;uestion: 6(d. p. <$7 -he
Cou't denied this motion on the g'ound solely that no
p'evious demand had been made on the ,u'ety fo'
the satisfaction of the .udgment. -he'eafte' the
necessa'y demand +as made, and upon failu'e of the
,u'ety to satisfy the .udgment, the plaintiffs filed a
second motion fo' e5ecution against the counte'bond.
n the date set fo' the hea'ing the'eon, the Cou't,
upon motion of the ,u'ety3s counsel, g'anted the latte'
a pe'iod of five days +ithin +hich to ans+e' the
motion. 8pon its failu'e to file such ans+e', the Cou't
g'anted the motion fo' e5ecution and the
co''esponding +'it +as issued.
,ubse;uently, the ,u'ety moved to ;uash the +'it on
the g'ound that the same +as issued +ithout the
'e;ui'ed summa'y hea'ing p'ovided fo' in ,ection "=
of Rule <# of the Rules of Cou't. As the Cou't denied
the motion, the ,u'ety appealed to the Cou't of
Appeals f'om such o'de' of denial and f'om the one
denying its motion fo' 'econside'ation 6(d. p. #=7. 1ts
'eco'd on appeal +as then p'inted as 'e;ui'ed by the
Rules, and in due time it filed its b'ief 'aising the'ein
no othe' ;uestion but the ones cove'ed by the
follo+ing assignment of e''o's9
1. -hat the >ono'able Cou't a )uo e''ed in
issuing its o'de' dated Novembe' (, "#<=, by
holding the incident as submitted fo'
'esolution, +ithout a summa'y hea'ing and
compliance +ith the othe' mandato'y
'e;ui'ements p'ovided fo' in ,ection "=,
Rule <# of the Rules of Cou't.
o'de'ing the issuance of e5ecution against
the he'ein bonding company-appellant.
denying the motion to ;uash the +'it of
e5ecution filed by the he'ein bonding
company-appellant as +ell as its subse;uent
motion fo' 'econside'ation, and?o' in not
;uashing o' setting aside the +'it of
e5ecution.
Not one of the assignment of e''o's & it is obvious &
'aises the ;uestion of lac* of .u'isdiction, neithe'
di'ectly no' indi'ectly.
Although the appellees failed to file thei' b'ief, the
Cou't of Appeals, on @ecembe' "", "#)(, decided the
case affi'ming the o'de's appealed f'om.
n !anua'y %, "#)4 & five days afte' the ,u'ety
'eceived notice of the decision, it filed a motion as*ing
fo' e5tension of time +ithin +hich to file a motion fo'
'econside'ation. -he Cou't of Appeals g'anted the
motion in its 'esolution of !anua'y "0 of the same
yea'. -+o days late' the ,u'ety filed a pleading
entitled M-1N - @1,M1,,, alleging substantially
that appellees action +as filed in the Cou't of /i'st
1nstance of Cebu on !uly "#, "#$% fo' the 'ecove'y of
the sum of P",#0%.00 onlyA that a month befo'e that
date Republic Act No. (#), othe'+ise *no+n as the
!udicia'y Act of "#$%, had al'eady become effective,
,ection %% of +hich placed +ithin the o'iginal
e5clusive .u'isdiction of infe'io' cou'ts all civil actions
+he'e the value of the sub.ect-matte' o' the amount
of the demand does not e5ceed P(,000.00, e5clusive
of inte'est and costsA that the Cou't of /i'st 1nstance
the'efo'e had no .u'isdiction to t'y and decide the
case. 8pon these p'emises the ,u'ety3s motion
p'ayed the Cou't of Appeals to set aside its decision
and to dismiss the case. By 'esolution of !anua'y "),
"#)4 the Cou't of Appeals 'e;ui'ed the appellees to
ans+e' the motion to dismiss, but they failed to do so.
Bhe'eupon, on May (0 of the same yea', the Cou't
'esolved to set aside its decision and to ce'tify the
case to 8s. -he pe'tinent po'tions of its 'esolution
'ead as follo+s9
1t +ould indeed appea' f'om the 'eco'd that
the action at ba', +hich is a suit fo' collection
of money in the sum of e5actly P",#0%.00
e5clusive of inte'est, +as o'iginally instituted
in the Cou't of /i'st 1nstance of Cebu on !uly
"#, "#$%. But about a month p'io' to the
filing of the complaint, mo'e specifically on
!une "=, "#$%, the !udicia'y Act of "#$%
too* effect, dep'iving the Cou't of /i'st
1nstance of o'iginal .u'isdiction ove' cases in
+hich the demand, e5clusive of inte'est, is
not mo'e than P(,000.00. 6,ecs. $$CcD and
%)CbD, R.A. No. (#).7
Be believe, the'efo'e, that the point 'aised in
appellant3s motion is an impo'tant one +hich
me'its se'ious conside'ation. As stated, the
complaint +as filed on !uly "#, "#$%. -his
case the'efo'e has been pending no+ fo'
almost "< yea's, and th'oughout the enti'e
p'oceeding appellant neve' 'aised the
;uestion of .u'isdiction until afte' 'eceipt of
this Cou't3s adve'se decision.
-he'e a'e th'ee cases decided by the
>ono'able ,up'eme Cou't +hich may be
+o'thy of conside'ation in connection +ith
this case, namely9 -yson -an, et al. vs.
/ilipinas CompaEia de ,egu'os, et al., F.R.
No. 2-"00#), Ma'ch (4, "#<)A Pindangan
Ag'icultu'al Co., 1nc. vs. !ose P. @ans, etc.,
et al., F.R. No. 2-"$<#", ,eptembe' (),
"#)(A and Alf'edo Montelibano, et al. vs.
Bacolod-Mu'cia Milling Co., 1nc., F.R. No. 2-
"<0#(, ,eptembe' (#, "#)(, +he'ein the
>ono'able ,up'eme Cou't f'o+ned upon the
3undesi'able p'actice3 of appellants
submitting thei' case fo' decision and then
accepting the .udgment, if favo'able, but
attac*ing it fo' lac* of .u'isdiction +hen
adve'se.
Conside'ing, ho+eve', that the ,up'eme
Cou't has the :e5clusive: appellate
.u'isdiction ove' :all cases in +hich the
.u'isdiction of any infe'io' cou't is in issue:
6,ee. ", Pa'. 4C4D, !udicia'y Act of "#$%, as
amended7, +e have no choice but to ce'tify,
as +e he'eby do ce'tify, this case to the
,up'eme Cou't.*+"ph,*.-.t
ACCR@1NF2G, pu'suant to ,ection 4" of
the !udicia'y Act of "#$% as amended, let
the 'eco'd of this case be fo'+a'ded to the
,up'eme Cou't.
1t is an undisputed fact that the action commenced by
appellees in the Cou't of /i'st 1nstance of Cebu
against the ,ibonghanoy spouses +as fo' the
'ecove'y of the sum of P",#0%.00 only & an amount
+ithin the o'iginal e5clusive .u'isdiction of infe'io'
cou'ts in acco'dance +ith the p'ovisions of the
!udicia'y Act of "#$% +hich had ta*en effect about a
month p'io' to the date +hen the action +as
commenced. -'ue also is the 'ule that .u'isdiction ove'
the sub.ect matte' is confe''ed upon the cou'ts
e5clusively by la+, and as the lac* of it affects the
ve'y autho'ity of the cou't to ta*e cogniHance of the
case, the ob.ection may be 'aised at any stage of the
p'oceedings. >o+eve', conside'ing the facts and
ci'cumstances of the p'esent case & +hich shall
fo'th+ith be set fo'th & Be a'e of the opinion that the
,u'ety is no+ ba''ed by laches f'om invo*ing this plea
at this late hou' fo' the pu'pose of annuling eve'ything
done he'etofo'e in the case +ith its active
pa'ticipation.
As al'eady stated, the action +as commenced in the
Cou't of /i'st 1nstance of Cebu on !uly "#, "#$%, that
is, almost fifteen years before the ,u'ety filed its
motion to dismiss on !anua'y "(, "#)4 'aising the
;uestion of lac* of .u'isdiction for the first ti'e.
1t must be 'emembe'ed that although the action,
o'iginally, +as e5clusively against the ,ibonghanoy
spouses the ,u'ety became a ;uasi-pa'ty the'ein
since !uly 4", "#$% +hen it filed a counte'-bond fo'
the dissolution of the +'it of attachment issued by the
cou't of o'igin 6Reco'd on Appeal, pp. "<-"#7. ,ince
then, it ac;ui'ed ce'tain 'ights and assumed specific
obligations in connection +ith the pending case, in
acco'dance +ith sections "( and "=, Rule <=, Rules
of Cou't 6Bautista vs. !oa;uin, $) Phil. %%<A Iimpang
J Co. vs. !avie', )< Phil. "=07.
8pon the filing of the fi'st motion fo' e5ecution against
the counte'-bond the ,u'ety not only filed a +'itten
opposition the'eto p'aying fo' its denial but also as*ed
fo' an additional affir'ative relief & that it be 'elieved
of its liability unde' the counte'-bond upon the
g'ounds 'elied upon in suppo't of its opposition &
lac* of .u'isdiction of the cou't a )uo not being one of
them.
-hen, at the hea'ing on the second motion fo'
e5ecution against the counte'-bond, the ,u'ety
appea'ed, th'ough counsel, to as* fo' time +ithin
+hich to file an ans+e' o' opposition the'eto. -his
motion +as g'anted, but instead of such ans+e' o'
opposition, the ,u'ety filed the motion to dismiss
mentioned he'etofo'e.
A pa'ty may be estopped o' ba''ed f'om 'aising a
;uestion in diffe'ent +ays and fo' diffe'ent 'easons.
-hus +e spea* of estoppel in pais, o' estoppel by
deed o' by 'eco'd, and of estoppel by laches.
2aches, in a gene'al sense is failu'e o' neglect, fo' an
un'easonable and une5plained length of time, to do
that +hich, by e5e'cising due diligence, could o'
should have been done ea'lie'A it is negligence o'
omission to asse't a 'ight +ithin a 'easonable time,
+a''anting a p'esumption that the pa'ty entitled to
asse't it eithe' has abandoned it o' declined to asse't
it.
-he doct'ine of laches o' of :stale demands: is based
upon g'ounds of public policy +hich 'e;ui'es, fo' the
peace of society, the discou'agement of stale claims
and, unli*e the statute of limitations, is not a me'e
;uestion of time but is p'incipally a ;uestion of the
ine;uity o' unfai'ness of pe'mitting a 'ight o' claim to
be enfo'ced o' asse'ted.
1t has been held that a pa'ty can not invo*e the
.u'isdiction of a cou't to su'e affi'mative 'elief against
his opponent and, afte' obtaining o' failing to obtain
such 'elief, 'epudiate o' ;uestion that same
.u'isdiction 6@ean vs. @ean, "4) '. )#$, %) A.2.R.
=#7. 1n the case .ust cited, by +ay of e5plaining the
'ule, it +as fu'the' said that the ;uestion +hethe' the
cou't had .u'isdiction eithe' of the sub.ect-matte' of
the action o' of the pa'ties +as not impo'tant in such
cases because the pa'ty is ba''ed f'om such
conduct not because the /udg'ent or order of the
court is valid and conclusive as an ad/udication$ but
for the reason that such a practice can not be
tolerated & obviously fo' 'easons of public policy.
/u'the'mo'e, it has also been held that afte'
volunta'ily submitting a cause and encounte'ing an
adve'se decision on the me'its, it is too late fo' the
lose' to ;uestion the .u'isdiction o' po+e' of the cou't
6Pease vs. Rathbun-!ones etc., ($4 8.,. (=4, )" 2.
Ed. ="<, 4= ,. Ct. (%4A ,t. 2ouis etc. vs. McB'ide, "$"
8.,. "(=, 4< 2. Ed. )<#7. And in 2ittleton vs. Bu'gess,
") Byo. <%, the Cou't said that it is not 'ight fo' a
pa'ty +ho has affi'med and invo*ed the .u'isdiction of
a cou't in a pa'ticula' matte' to secu'e an affi'mative
'elief, to afte'+a'ds deny that same .u'isdiction to
escape a penalty.
8pon this same p'inciple is +hat Be said in the th'ee
cases mentioned in the 'esolution of the Cou't of
Appeals of May (0, "#)4 6supra7 & to the effect that
+e f'o+n upon the :undesi'able p'actice: of a pa'ty
submitting his case fo' decision and then accepting
the .udgment, only if favo'able, and attac*ing it fo'
lac* of .u'isdiction, +hen adve'se & as +ell as
in %inda-gan etc. vs. 0ans$ et al., F.R. 2-"$<#",
,eptembe' (), "#)(A &ontelibano$ et al.$ vs. acolod-
&urcia &illing Co.$ (nc., F.R. 2-"<0#(A 1oung &en
Labor Union etc. vs. 2he Court of (ndustrial 3elation
et al., F.R. 2-(040=, /eb. (), "#)<, and &e/ia vs.
Lucas, "00 Phil. p. (==.
-he facts of this case sho+ that f'om the time the
,u'ety became a ;uasi-pa'ty on !uly 4", "#$%, it
could have 'aised the ;uestion of the lac* of
.u'isdiction of the Cou't of /i'st 1nstance of Cebu to
ta*e cogniHance of the p'esent action by 'eason of
the sum of money involved +hich, acco'ding to the
la+ then in fo'ce, +as +ithin the o'iginal e5clusive
.u'isdiction of infe'io' cou'ts. 1t failed to do so. 1nstead,
at seve'al stages of the p'oceedings in the cou't a
)uo as +ell as in the Cou't of Appeals, it invo*ed the
.u'isdiction of said cou'ts to obtain affi'mative 'elief
and submitted its case fo' a final ad.udication on the
me'its. 1t +as only afte' an adve'se decision +as
'ende'ed by the Cou't of Appeals that it finally +o*e
up to 'aise the ;uestion of .u'isdiction. Be'e +e to
sanction such conduct on its pa't, Be +ould in effect
be decla'ing as useless all the p'oceedings had in the
p'esent case since it +as commenced on !uly "#,
"#$% and compel the .udgment c'edito's to go up thei'
Calva'y once mo'e. -he ine;uity and unfai'ness of
this is not only patent but 'evolting.
Coming no+ to the me'its of the appeal9 afte' going
ove' the enti'e 'eco'd, Be have become pe'suaded
that Be can do nothing bette' than to ;uote in toto,
+ith app'oval, the decision 'ende'ed by the Cou't of
Appeals on @ecembe' "", "#)( as follo+s9
1n Civil Case No. R-))0 of the Cou't of /i'st
1nstance of Cebu, +hich +as a suit fo'
collection of a sum of money, a +'it of
attachment +as issued against defendants3
p'ope'ties. -he attachment, ho+eve', +as
subse;uently discha'ged unde' ,ection "(
of Rule <# upon the filing by defendants of a
bond subsc'ibed by Manila ,u'ety J /idelity
Co., 1nc.
Afte' t'ial, .udgment +as 'ende'ed in favo' of
plaintiffs.
-he +'it of e5ecution against defendants
having been 'etu'ned totally unsatisfied,
plaintiffs moved, unde' ,ection "= of Rule
<#, fo' issuance of +'it of e5ecution against
Manila ,u'ety J /idelity Co., 1nc. to enfo'ce
the obligation of the bond. But the motion
+as, upon the su'ety3s opposition, denied on
the g'ound that the'e +as :no sho+ing that a
demand had been made, by the plaintiffs to
the bonding company fo' payment of the
amount due unde' the .udgment: 6Reco'd on
Appeal, p. )07.
>ence, plaintiffs made the necessa'y
demand upon the su'ety fo' satisfaction of
the .udgment, and upon the latte'3s failu'e to
pay the amount due, plaintiffs again filed a
motion dated ctobe' 4", "#<=, fo' issuance
of +'it of e5ecution against the su'ety, +ith
notice of hea'ing on Novembe' (, "#<=. n
ctobe' 4", "#<=, the su'ety 'eceived copy
of said motion and notice of hea'ing.
1t appea's that +hen the motion +as called
on Novembe' (, "#<=, the su'ety3s counsel
as*ed that he be given time +ithin +hich to
ans+e' the motion, and so an o'de' +as
issued in open cou't, as follo+s9*+"ph,*.-.t
As prayed for, Atty. !ose P.
,obe'ano, !'., counsel fo' the
Manila ,u'ety J /idelity Co., 1nc.,
Cebu B'anch, is given until
4ednesday$ 5ove'ber ), "#<=, to
file his ans"er to the motion fo' the
issuance of a +'it of e5ecution
dated ctobe' 40, "#<= of the
plaintiffs, after "hich this incident
shall be dee'ed sub'itted for
resolution.
, R@ERE@.
Fiven in open cou't, this (nd day of
Novembe', "#<=, at Cebu City,
Philippines.
6,gd.7 !,E M.
MEN@KA
!udge
6Reco'd on Appeal, pp.
)$-)<, emphasis ou's7
,ince the su'ety3s counsel failed to file any
ans+e' o' ob.ection +ithin the pe'iod given
him, the cou't, on @ecembe' =, "#<=, issued
an o'de' g'anting plaintiffs3 motion fo'
e5ecution against the su'etyA and on
@ecembe' "(, "#<=, the co''esponding +'it
of e5ecution +as issued.
n @ecembe' ($, "#<=, the su'ety filed a
motion to ;uash the +'it of e5ecution on the
g'ound that the same +as :issued +ithout
the 'e;ui'ements of ,ection "=, Rule <# of
the Rules of Cou't having been complied
+ith,: mo'e specifically, that the same +as
issued +ithout the 'e;ui'ed :summa'y
hea'ing:. -his motion +as denied by o'de' of
/eb'ua'y "0, "#<%.
n /eb'ua'y (<, "#<%, the su'ety filed a
motion fo' 'econside'ation of the above-
stated o'de' of denialA +hich motion +as
li*e+ise denied by o'de' of Ma'ch (), "#<%.
/'om the above-stated o'de's of /eb'ua'y
"0, "#<% and Ma'ch (), "#<% & denying the
su'ety3s motion to ;uash the +'it of e5ecution
and motion fo' 'econside'ation, 'espectively
& the su'ety has inte'posed the appeal on
hand.
-he su'ety insists that the lo+e' cou't should
have g'anted its motion to ;uash the +'it of
e5ecution because the same +as issued
+ithout the summa'y hea'ing 'e;ui'ed by
,ection "= of Rule <#, +hich 'eadsA
:,ec. "=. 4hen e6ecution returned
unsatisfied$ recovery had upon
bond. & 1f the e5ecution be
'etu'ned unsatisfied in +hole o' in
pa't, the su'ety o' su'eties on any
bond given pu'suant to the
p'ovisions of this 'ole to secu'e the
payment of the .udgment shall
become finally cha'ged on such
bond, and bound to pay to the
plaintiff upon demand the amount
due unde' the .udgment, +hich
amount may be 'ecove'ed f'om
such su'ety o' su'eties afte' notice
and su''ary hearing in the sa'e
action.: 6Emphasis ou's7
,umma'y hea'ing is :not intended to be
ca''ied on in the fo'mal manne' in +hich
o'dina'y actions a'e p'osecuted: 6%4 C.!.,.
=#(7. 1t is, 'athe', a p'ocedu'e by +hich a
;uestion is 'esolved :+ith dispatch, +ith the
least possible delay, and in p'efe'ence to
o'dina'y legal and 'egula' .udicial
p'oceedings: 6(bid, p. =#07. Bhat is essential
is that :the defendant is notified o'
summoned to appea' and is given an
oppo'tunity to hea' +hat is u'ged upon him,
and to inte'pose a defense, afte' +hich
follo+s an ad.udication of the 'ights of the
pa'ties: 6(bid., pp. =#4-=#$7A and as to the
e5tent and latitude of the hea'ing, the same
+ill natu'ally lie upon the disc'etion of the
cou't, depending upon the attending
ci'cumstances and the natu'e of the incident
up fo' conside'ation.
1n the case at ba', the su'ety had been
notified of the plaintiffs3 motion fo' e5ecution
and of the date +hen the same +ould be
submitted fo' conside'ation. 1n fact, the
su'ety3s counsel +as p'esent in cou't +hen
the motion +as called, and it +as upon his
'e;uest that the cou't a )uo gave him a
pe'iod of fou' days +ithin +hich to file an
ans+e'. Get he allo+ed that pe'iod to lapse
+ithout filing an ans+e' o' ob.ection. -he
su'ety cannot no+, the'efo'e, complain that it
+as dep'ived of its day in cou't.
1t is a'gued that the su'ety3s counsel did not
file an ans+e' to the motion :fo' the simple
'eason that all its defenses can be set up
du'ing the hea'ing of the motion even if the
same a'e not 'educed to +'iting: 6Appellant3s
b'ief, p. $7. -he'e is obviously no me'it in this
p'etense because, as stated above, the
'eco'd +ill sho+ that +hen the motion +as
called, +hat the su'ety3s counsel did +as to
as* that he be allo+ed and given time to file
an ans+e'. Mo'eove', it +as stated in the
o'de' given in open cou't upon 'e;uest of the
su'ety3s counsel that afte' the fou'-day
pe'iod +ithin +hich to file an ans+e', :the
incident shall be deemed submitted fo'
'esolution:A and counsel appa'ently ag'eed,
as the o'de' +as issued upon his instance
and he inte'posed no ob.ection the'eto.
1t is also u'ged that although acco'ding to
,ection "= of Rule <#, supra, the'e is no
need fo' a sepa'ate action, the'e must,
ho+eve', be a sepa'ate .udgment against
the su'ety in o'de' to hold it liable on the
bond 6Appellant3s B'ief, p. "<7. Not so, in ou'
opinion. A bond filed fo' discha'ge of
attachment is, pe' ,ection "( of Rule <#, :to
secu'e the payment to the plaintiff of any
.udgment he may 'ecove' in the action,: and
stands :in place of the property so released:.
>ence, afte' the .udgment fo' the plaintiff has
become e5ecuto'y and the e5ecution is
:'etu'ned unsatisfied: 6,ec. "=, Rule <#7, as
in this case, the liability of the bond
automatically attaches and, in failu'e of the
su'ety to satisfy the .udgment against the
defendant despite demand the'efo', +'it of
e5ecution may issue against the su'ety to
enfo'ce the obligation of the bond.
8PN A22 ->E /REF1NF, the o'de's appealed
f'om a'e he'eby affi'med, +ith costs against the
appellant Manila ,u'ety and /idelity Company, 1nc.
,8PREME C8R-
Manila
->1R@ @1L1,1N
F.R. No. "%")(( Novembe' (0, (0"4
FENE,1, 1NLE,-MEN-, 1NC., CEB8 !AGA REA2-G
1NC., and ,P8,E, R>@RA and 2AMBER- 21M,
Petitione's,
vs.
>E1R, of CE/ER1N EBARA,ABA2,M NAME2G9
RFE21 EBARA,ABA2, ,P8,E, 21FAGA E.
F821M21M AN@ !,E F821M21M, ,P8,E,
L1,1-AC1N E. CNE!, and E21A, CNE!,,
BEN -E!ER, PCA, -E!ER, FER-R8@E,
-E!ER, BAN1NF >AG, 2AC1 EBARA,ABA2 and
!821E-A EBARA,ABA2A >E1R, / /2R
EBARA,ABA2, namely9 ,/1A ABE2NF, PEP1-
EBARA,ABA2 AN@ E2P1@1 EBARA,ABA2A >E1R,
/ 2ENA EBARA,ABA2- AP22, namely9
,12LE,-RA A. M!E22 and MARCE21N
AP22A >E1R, / PE@R EBARA,ABA2,
namely9 BN1/AC1 EBARA,ABA2, ,ERF1
EBARA,ABA2 and !A1ME EBARA,ABA2A >E1R, of
1,1@R EBARA,ABA2, NAME2G9 ,P8,E,
CAR2,A E. N8EL and /R-8NA- N8ELAAMM
>E1R, of BEN1- EBARA,ABA2, namely9 PA82
BAFAAN, ,P8,E, CA-A21NA A. MAR1BA and
RENE MAR1BA, L1CEN-E ABR1N1CA and PA-RN
EBARA,ABA2A >E1R, of !821AN EBARA,ABA2,
NAME2G9 A2/RE@ BAFAAN, !8AN BAFAAN,
ALE21N BAFAAN, /ER@1NAN@ BAFAAN, MA8R
BAFAAN, ,P8,E, RBENA B. 2A,ACA and
/RANC1,C 2ACA,A,MMM ,P8,E, MAR1A B.
CABAF and EM121 CABAF and E,-E21-A
BAFAAN, all being 'ep'esented he'ein by L1C-R
M!E22, /E@ER1C BAFAAN and PA821N
EBARA,ABA2, as thei' Atto'neys-in-/act,
Respondents.
@ E C 1 , 1 N
PERA2-A, !.9
Befo'e the Cou't is a petition fo' 'evie+ on ce'tio'a'i
unde' Rule $< of the Rules of Cou't see*ing to
'eve'se and set aside the @ecision" and Resolution,(
dated !uly "", (00= and !anua'y "0, (00%,
'espectively, of the Cou't of Appeals 6CA7 in CA-F.R.
CEB-,P No. 0"0"=.
-he antecedents of the case a'e as follo+s9
n Novembe' "(, (004, he'ein 'espondents filed
against he'ein petitione's a Complaint4 fo'
@ecla'ation of Nullity of @ocuments, Recove'y of
,ha'es, Pa'tition, @amages and Atto'ney3s /ees. -he
Complaint +as filed +ith the Regional -'ial Cou't
6R-C7 of Ba'ili, Cebu.
n August <, (00$, he'ein petitione's filed a Motion to
@ismiss$ contending, among othe's, that the R-C
has no .u'isdiction to t'y the case on the g'ound that,
as the case involves title to o' possession of 'eal
p'ope'ty o' any inte'est the'ein and since the
assessed value of the sub.ect p'ope'ty does not
e5ceed P(0,000.00 6the same being only
P"",##0.007, the action falls +ithin the .u'isdiction of
the Municipal -'ial Cou't 6M-C7.<
1n its 'de') dated ,eptembe' (#, (00$, the R-C
g'anted petitione's3 Motion to @ismiss, holding as
follo+s9
5 5 5 5
And +hile the p'aye' of the plaintiffs fo' the annulment
of documents ;ualified the case as one incapable of
pecunia'y estimation thus, 'ende'ing it cogniHable
supposedly by the second level cou'ts but conside'ing
that Republic Act No. =)#" e5p'essly p'ovides to
cove' :all civil actions: +hich ph'ase unde'standably
is to include those incapable of pecunia'y estimation,
li*e the case at ba', this Cou't is of the vie+ that said
la+ 'eally finds application he'e mo'e so that the
same case also :involves title to, o' possession of,
'eal p'ope'ty, o' any inte'est the'ein.: /o' being so,
the assessed value of the 'eal p'ope'ty involved is
dete'minative of +hich cou't has .u'isdiction ove' the
case. And the plaintiffs admitting that the assessed
value of the litigated a'ea is less than P(0,000.00, the
defendants a'e co''ect in a'guing that the case is
beyond this Cou't3s .u'isdiction.=
Respondents filed a Motion fo' Pa'tial
Reconside'ation,% a'guing that thei' complaint
consists of seve'al causes of action, including one fo'
annulment of documents, +hich is incapable of
pecunia'y estimation and, as such, falls +ithin the
.u'isdiction of the R-C.#
n Ma'ch "=, (00<, the R-C issued an 'de'
g'anting 'espondents3 Motion fo' Pa'tial
Reconside'ation and 'eve'sing its ea'lie' 'de' dated
,eptembe' (#, (00$. -he R-C 'uled, thus9
n the issue of +ant of .u'isdiction, this cou't li*e+ise
finds to be +ith me'it the contention of the movants as
indeed the main case o' the p'ima'y 'elief p'ayed fo'
by the movants is fo' the decla'ation of nullity o'
annulment of documents +hich un;uestionably is
incapable of pecunia'y estimation and thus +ithin the
e5clusive o'iginal .u'isdiction of this cou't to t'y
although in the p'ocess of 'esolving the cont'ove'sy,
claims of title o' possession of the p'ope'ty in
;uestion is involved +hich togethe' +ith all the othe'
'emaining 'eliefs p'ayed fo' a'e but pu'ely incidental
to o' as a conse;uence of the fo'egoing p'incipal
'elief sought."0
Petitione's filed a Motion fo' Reconside'ation,"" but
the R-C denied it in its 'de' dated !une (4, (00<.
Agg'ieved, petitione's filed a petition fo' ce'tio'a'i +ith
the CA. >o+eve', the CA dismissed the petition via its
assailed @ecision dated !uly "", (00=, holding that
the sub.ect matte' of 'espondents3 complaint is
incapable of pecunia'y estimation and, the'efo'e,
+ithin the .u'isdiction of the R-C, conside'ing that the
main pu'pose in filing the action is to decla'e null and
void the documents assailed the'ein."(
Petitione's3 Motion fo' Reconside'ation +as,
subse;uently, denied in the CA Resolution dated
!anua'y "0, (00%.
>ence, the instant petition fo' 'evie+ on ce'tio'a'i
'aising the sole issue, to +it9
Bhethe' o' not the >ono'able Cou't of Appeals
g'avely e''ed in concluding that the Regional -'ial
Cou't, B'anch )0 of Ba'ili, Cebu has .u'isdiction ove'
the instant case +hen the A22EFA-1N, 1N ->E
CMP2A1N- clea'ly sho+s that the main cause of
action of the 'espondents is fo' the Recove'y of thei'
-itle, 1nte'est, and ,ha'e ove' a Pa'cel of 2and, +hich
has an assessed value of P"",##0.00 and thus, +ithin
the .u'isdiction of the Municipal -'ial Cou't."4
-he petition lac*s me'it.
/o' a clea'e' unde'standing of the case, this Cou't,
li*e the CA, finds it p'ope' to ;uote pe'tinent po'tions
of 'espondents3 Complaint, to +it9
5 5 5 5
". Plaintiffs a'e all /ilipino, of legal age, su'viving
descendants N eithe' as g'andchild'en o' g'eat
g'andchild'en N and hei's and successo's-in-inte'est
of deceased Roman Eba'sabal, +ho died on 0=
,eptembe' "#<( 5 5 5
5 5 5 5
%. @u'ing the lifetime of Roman Eba'sabal, he
ac;ui'ed a pa'cel of land situated in Basda*u,
,aaved'a, Moalboal, Cebu, 5 5 5.
5 5 5 5
+ith a total assessed value of P(,%#0.00 5 5 5.
>o+eve', fo' the yea' (00(, the p'ope'ty +as al'eady
having 6sic7 a total assessed value of P"",##0.00 5 5
5.
#. 8pon the death of said Roman Eba'sabal, his eight
6%7 child'en named in pa'. = above, became co-
o+ne's of his above-desc'ibed p'ope'ty by he'edita'y
successionA ta*ing peaceful possession and
en.oyment of the same in fee simple p'o indiviso,
paying the 'eal estate ta5es the'eon and did not
pa'tition the said p'ope'ty among themselves until all
of them li*e+ise died, leaving, ho+eve', thei'
'espective child'en and descendants and?o' su'viving
hei's and successo's-in-inte'est, and +ho a'e no+ the
above-named plaintiffs he'einA
"0. -he plaintiffs +ho a'e mostly 'esidents in 6sic7
Mindanao and Manila, have .ust 'ecently uncove'ed
the fact that on (%th !anua'y "##=, the child'en and
descendants of deceased Fil Eba'sabal, namely9
Pelagio, >ipolito, P'ecela, /'uctuosa, Robe'ta,
/lo'entino, E'linda, ,ebastian, Ci'ilo, all su'named
Eba'sabal, have e5ecuted among themselves a @eed
of E5t'a.udicial ,ettlement +ith ,ale of Roman
Eba'sabal3s enti'e p'ope'ty desc'ibed above, by vi'tue
of +hich they allegedly e5t'a.udicially settled the same
and, fo' P(,)00,000.00 N although only the sum of
P#<0,000.00 +as 'eflected in thei' @eed of ,ale fo'
'eason only *no+n to them, they sold the +hole
p'ope'ty to defendants Fenesis 1nvestment 1nc.
'ep'esented by co-defendant Rhodo'a B. 2im, the
+ife of 2ambe't 2im, +ithout the *no+ledge,
pe'mission and consent of the plaintiffs +ho a'e the
vendo's3 co-o+ne's of the lot in ;uestion, 5 5 5.
"". ,u'p'isingly, ho+eve', the defendant Fenesis
managed to have the -a5 @ecla'ation of the p'ope'ty
issued in the name of co-defendant Cebu !aya Realty
1nco'po'ated, a fi'm +hich, as al'eady intimated
above, is also o+ned by ,pouses 2ambe't and
Rhodo'a B. 2im, instead of in the name of Fenesis
1nvestment, 1nco'po'ated, +hich is actually the
vendee fi'm of the lot in ;uestion.
5 5 5 5
>ence, the 'eason +hy Cebu !aya Realty,
1nco'po'ated is .oined and impleaded he'ein as a co-
defendant.
"(. Bithout the pa'ticipation of the plaintiffs +ho a'e
co-o+ne's of the lot in ;uestion in the p'oceedings,
the afo'ementioned e5t'a.udicial settlement +ith sale
cannot be binding upon the plaintiff-co-o+ne's.
"4. /u'the', +he'e as in this case, the othe' hei's +ho
a'e the plaintiffs he'ein, did not consent to the sale of
thei' ideal sha'es in the inhe'ited p'ope'ty, the sale
+as only to be limited to the p'o indiviso sha'e of the
selling hei's.
5 5 5 5
"$. By 'ep'esentation, the plaintiffs, a'e the'efo'e, by
la+, entitled to thei' 'ightful sha'es f'om the estate of
the deceased Roman Eba'sabal consisting of seven
6=7 sha'es that +ould have been due as the sha'es of
seven 6=7 othe' child'en of Roman Eba'sabal +ho a'e
also no+ deceased, namely9 Cefe'ino, /lo'o, 2eona,
Ped'o, 1sido'o, !ulian and Benito, all su'named
Eba'sabal.
"<. -he defendants +ho had p'io' *no+ledge of the
e5istence of the othe' hei's +ho a'e co-o+ne's of the
vendo's of the p'ope'ty they pu'chased, had
unla+fully acted in bad faith in insisting to buy the
+hole p'ope'ty in co-o+ne'ship, only f'om the hei's
and successo's-in-inte'est of deceased Fil Eba'sabal,
+ho is only one 6"7 of the eight 6%7 child'en of
deceased Roman Eba'sabal, and +ithout notifying
the'eof in +hateve' manne' the plaintiffs +ho a'e the
hei's and successo's-in-inte'est of the othe' co-
o+ne's of the p'ope'ty-in-;uestionA thus, have
compelled the plaintiffs he'ein to file this instant case
in cou't to p'otect thei' inte'ests, 5 5 5.
5 5 5 5
PRAGER
B>ERE/RE, in vie+ of all the fo'egoing, it is most
'espectfully p'ayed of this >ono'able Cou't that, afte'
due notice and hea'ing, .udgment shall be 'ende'ed in
favo' of the plaintiffs, as follo+s, to +it9
" N @ecla'ing as null and void and not binding upon
the plaintiffs, the follo+ing documents to +it9
6a7 @eed of E5t'a.udicial ,ettlement +ith ,ale
e5ecuted by and bet+een the hei's of deceased Fil
Eba'sabal headed by Ped'o Eba'sabal, and Fenesis
1nvestment, 1nc., 'ep'esented by Rhodo'a 2im, dated
(%th of !anua'y, "##=, ma'*ed as Anne5-AA
6b7 Memo'andum of Ag'eement e5ecuted bet+een
Ped'o Eba'sabal and Fenesis 1nvestment, 1nc.,
'ep'esented by Rhodo'a 2im dated (= !anua'y, +hich
document is nota'iHedA
6c7 -a5 @ecla'ation of Real P'ope'ty issued to Cebu
!aya Realty, 1nc., ma'*ed as Anne5-@A
( N 'de'ing the defendants to ma*e pa'tition of the
p'ope'ty in litigation +ith the plaintiffs into eight 6%7
e;ual sha'esA to get one 6"7 sha'e the'eof, +hich is
the only e5tent of +hat they allegedly ac;ui'ed by
pu'chase as mentioned above, and to t'ansfe',
'esto'e o' 'econvey and delive' to the plaintiffs, seven
6=7 sha'es the'eof, as pe'taining to and due fo' the
latte' as the hei's and successo's-in-inte'est of the
seven 6=7 b'othe's and siste' of deceased Fil
Eba'sabal al'eady named ea'lie' in this complaintA
5 5 5 5
/u'the' 'eliefs and 'emedies .ust and e;uitable in the
p'emises a'e also he'ein p'ayed fo'.
5 5 5 5"$
1t is t'ue that one of the causes of action of
'espondents pe'tains to the title, possession and
inte'est of each of the contending pa'ties ove' the
contested p'ope'ty, the assessed value of +hich falls
+ithin the .u'isdiction of the M-C. >o+eve', a
complete 'eading of the complaint +ould 'eadily sho+
that, based on the natu'e of the suit, the allegations
the'ein, and the 'eliefs p'ayed fo', the action is +ithin
the .u'isdiction of the R-C.
As stated above, it is clea' f'om the 'eco'ds that
'espondents3 complaint +as fo' :@ecla'ation of Nullity
of @ocuments, Recove'y of ,ha'es, Pa'tition,
@amages and Atto'ney3s /ees.: 1n filing thei'
Complaint +ith the R-C, 'espondents sought to
'ecove' o+ne'ship and possession of thei' sha'es in
the disputed pa'cel of land by ;uestioning the due
e5ecution and validity of the @eed of E5t'a.udicial
,ettlement +ith ,ale as +ell as the Memo'andum of
Ag'eement ente'ed into by and bet+een some of thei'
co-hei's and he'ein petitione's. Aside f'om p'aying
that the R-C 'ende' .udgment decla'ing as null and
void the said @eed of E5t'a.udicial ,ettlement +ith
,ale and Memo'andum of Ag'eement, 'espondents
li*e+ise sought the follo+ing9 6"7 nullification of the
-a5 @ecla'ations subse;uently issued in the name of
petitione' Cebu !aya Realty, 1nc.A 6(7 pa'tition of the
p'ope'ty in litigationA 647 'econveyance of thei'
'espective sha'esA and 647 payment of mo'al and
e5empla'y damages, as +ell as atto'ney3s fees, plus
appea'ance fees."O+phi"
Clea'ly, this is a case of .oinde' of causes of action
+hich comp'ehends mo'e than the issue of pa'tition
of o' 'ecove'y of sha'es o' inte'est ove' the 'eal
p'ope'ty in ;uestion but includes an action fo'
decla'ation of nullity of cont'acts and documents
+hich is incapable of pecunia'y estimation."<
As cited by the CA, this Cou't, in the case of ,ingson
v. 1sabela ,a+mill,") held that9
1n dete'mining +hethe' an action is one the sub.ect
matte' of +hich is not capable of pecunia'y
estimation, this Cou't has adopted the c'ite'ion of fi'st
asce'taining the natu'e of the p'incipal action o'
'emedy sought. 1f it is p'ima'ily fo' the 'ecove'y of a
sum of money, the claim is conside'ed capable of
pecunia'y estimation, and +hethe' .u'isdiction is in the
municipal cou'ts o' in the cou'ts of fi'st instance
+ould depend on the amount of the claim. >o+eve',
+he'e the basic issue is something othe' than the
'ight to 'ecove' a sum of money, +he'e the money
claim is pu'ely incidental to, o' a conse;uence of, the
p'incipal 'elief sought, this Cou't has conside'ed such
actions as cases +he'e the sub.ect of the litigation
may not be estimated in te'ms of money, and a'e
cogniHable by cou'ts of fi'st instance Cno+ Regional
-'ial Cou'tsD."=
-his 'ule +as 'eite'ated in Russell v. Lestil"% and
,ocial ,ecu'ity ,ystem v. Atlantic Fulf and Pacific
Company of Manila 1nc."#
Cont'a'y to petitione's contention, the p'incipal 'elief
sought by petitione's is the nullification of the sub.ect
E5t'a.udicial ,ettlement +ith ,ale ente'ed into by and
bet+een some of thei' co-hei's and 'espondents,
insofa' as thei' individual sha'es in the sub.ect
p'ope'ty a'e conce'ned. -hus, the 'ecove'y of thei'
undivided sha'es o' inte'est ove' the disputed lot,
+hich +e'e included in the sale, simply becomes a
necessa'y conse;uence if the above deed is nullified.
>ence, since the p'incipal action sought in
'espondents Complaint is something othe' than the
'ecove'y of a sum of money, the action is incapable of
pecunia'y estimation and, thus, cogniHable by the
R-C.(0 Bell ent'enched is the 'ule that .u'isdiction
ove' the sub.ect matte' of a case is confe''ed by la+
and is dete'mined by the allegations in the complaint
and the cha'acte' of the 'elief sought, i''espective of
+hethe' the pa'ty is entitled to all o' some of the
claims asse'ted.("
Mo'eove', it is p'ovided unde' ,ection < 6c7, Rule ( of
the Rules of Cou't that +he'e the causes of action a'e
bet+een the same pa'ties but pe'tain to diffe'ent
venues o' .u'isdictions, the .oinde' may be allo+ed in
the R-C p'ovided one of the causes of action falls
+ithin the .u'isdiction of said cou't and the venue lies
the'ein. -hus, as sho+n above, 'espondents
complaint clea'ly falls +ithin the .u'isdiction of the
R-C.
B>ERE/RE, the petition is @EN1E@. -he @ecision
and Resolution dated !uly "", (00= and !anua'y "0,
(00%, 'espectively, of the Cou't of Appeals in CA-F.R.
CEB-,P No. 0"0"= a'e A//1RME@.
, R@ERE@.
Supreme Court
Manila

SECOND DIVISION

PAGLAUM MANAGEMENT
& DEVELOPMENT CORP.
and HEALTH MARKETING
TECHNOLOGIES
INC.
Petitioners,

! "er#u# !

UNION $ANK O% THE
PHILIPPINES NOTAR&
PU$LIC 'OHN DOE and
REGISTER O% DEEDS o(
Ce)u C*t+ and Ce)u Pro"*n,e
Respondents.

'. KING & SONS CO. INC.
Intervenor.

G.R. No. -./0-1

Present:

CARPIO, J.,
Chairperson,
BRION,
PERE,
!ERENO, and
RE"E!, JJ.

Pro#ul$ated:

%une &', ()&(

* + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + +
+ + + + + + + + + + +*

D E C I S I O N

SERENO J.2
Before this Court is a Petition for Revie, on
Certiorari under Rule -. of the Rules of Court, assailin$ the
/ecision dated 0& Ma1 ())2
3&4
and Resolution dated (-
%ul1 ())2
3(4
issued b1 the Court of Appeals 5CA6.
Petitioner Pa$lau# Mana$e#ent and
/evelop#ent Corporation 5PA78A9M6 is the re$istered
o,ner of three parcels of land located in the Province of
Cebu
304
and covered b1 :ransfer Certificate of :itle 5:C:6
Nos. &&(-'',
3-4
&&(-';,
3.4
and :+<'.&<.
3<4
:hese lots are co+
o,ned b1 Ben=a#in B. /1, the president of petitioner
>ealth Mar?etin$ :echnolo$ies, Inc. 5>ealth:ech6, and his
#other and siblin$s.
324
On 0 @ebruar1 &;;-, respondent 9nion Ban? of
the Philippines 59nion Ban?6 e*tended >ealth:ech a credit
line in the a#ount of &),))),))).
3'4
:o secure this
obli$ation, PA78A9M e*ecuted three Real Estate
Mort$a$es on behalf of >ealth:ech and in favor of 9nion
Ban?.
3;4
It #ust be noted that the Real Estate Mort$a$e, on
the provision re$ardin$ the venue of all suits and actions
arisin$ out of or in connection
there,ith, or*3*na44+ stipulates:
!ection ;. Aenue. B :he
venue of all suits and actions arisin$
out of or in connection ,ith this
Mort$a$e shall be in Ma5at*, Metro
Manila or in the place ,here an1 of the
Mort$a$ed Properties is located, at the
absolute option of the Mort$a$ee, t6e
part*e# 6ereto 7a*"*n3 an+ ot6er
"enue.
3&)4
5E#phasis supplied.6
>o,ever, under the t,o Rea4 E#tate Mort3a3e#
dated -- %e)ruar+ -//8, the follo,in$ "er#*on appears:
Mort$a$e shall be in Ce)u C*t+ Metro
Manila or in the place ,here an1 of the
Mort$a$ed Properties is located, at the
absolute option of the Mort$a$ee,
the 9999999999999 an1 other venue.
3&&4
Mean,hile, the sa#e provision in the Rea4
E#tate Mort3a3e dated :: Apr*4 -//1 contains the
follo,in$:
Mort$a$e shall be in CCCCCCCCC or in
the place ,here an1 of the Mort$a$ed
Properties is located, at the absolute
option of the Mort$a$ee, the parties
hereto ,aivin$ an1 other venue.
3&(4
>ealth:ech and 9nion Ban? a$reed to
subseDuent rene,als and increases in the credit line,
3&04
,ith
the total a#ount of debt reachin$ 0<,.)),))).
3&-4
9nfortunatel1, accordin$ to >ealth:ech, the &;;2 Asian
financial crisis adversel1 affected its business and caused it
difficult1 in #eetin$ its obli$ations ,ith 9nion Ban?.
3&.4
:hus, on && /ece#ber &;;', both parties entered into a
Restructurin$ A$ree#ent,
3&<4
,hich states that an1 action or
proceedin$ arisin$ out of or in connection there,ith shall
be co##enced in Ma5at* C*t+, ,ith both parties 7a*"*n3
an+ ot6er "enue.
3&24
/espite the Restructurin$ A$ree#ent, >ealth:ech
failed to pa1 its obli$ation, pro#ptin$ 9nion Ban? to send
a de#and letter dated ; October ())), statin$ that the latter
,ould be constrained to institute foreclosure proceedin$s,
unless >ealth:ech settled its account in full.
3&'4
!ince >ealth:ech defaulted on its pa1#ent,
9nion Ban? e*tra+=udiciall1 foreclosed the #ort$a$ed
properties.
3&;4
:he ban?, as the sole bidder in the auction
sale, ,as then issued a Certificate of !ale dated (- Ma1
())&.
3()4
:hereafter, it filed a Petition for Consolidation of
:itle.
3(&4
ConseDuentl1, >ealth:ech filed a Co#plaint for
Annul#ent of !ale and :itles ,ith /a#a$es and
Application for :e#porar1 Restrainin$ Order and Erit of
In=unction dated (0 October ())&, pra1in$ for: 5a6 the
issuance of a te#porar1 restrainin$ order, and later a ,rit
of preli#inar1 in=unction, directin$ 9nion Ban? to refrain
fro# e*ercisin$ acts of o,nership over the foreclosed
propertiesF 5b6 the annul#ent of the e*tra+=udicial
foreclosure of real propertiesF 5c6 the cancellation of the
re$istration of the Certificates of !ale and the resultin$
titles issuedF 5d6 the reinstate#ent of PA78A9MGs
o,nership over the sub=ect propertiesF and 5e6 the pa1#ent
of da#a$es.
3((4
:he case ,as doc?eted as Civil Case No.
)&+&.<2 and raffled to the Re$ional :rial Court, National
Capital %udicial Re$ion, Ma?ati Cit1, Branch &0- 5R:C Br.
&0-6, ,hich issued in favor of PA78A9M and >ealth:ech
a Erit of Preli#inar1 In=unction restrainin$ 9nion Ban?
fro# proceedin$ ,ith the auction sale of the three
#ort$a$ed properties.
3(04
On (0 Nove#ber ())&, 9nion Ban? filed a
Motion to /is#iss on the follo,in$ $rounds: 5a6 lac? of
=urisdiction over the issuance of the in=unctive reliefF 5b6
i#proper venueF and 5c6 lac? of authorit1 of the person ,ho
si$ned the Co#plaint.
3(-4
R:C Br. &0- $ranted this Motion
in its Order dated && March ())0, resultin$ in the dis#issal
of the case, as ,ell as the dissolution of the Erit of
Preli#inar1 In=unction.
3(.4
It li?e,ise denied the subseDuent
Motion for Reconsideration filed b1 PA78A9M and
>ealth:ech.
3(<4
PA78A9M and >ealth:ech elevated the case to
the CA, ,hich affir#ed the Order dated && March
())0
3(24
and denied the Motion for Reconsideration.
3('4
In the instant Petition, PA78A9M and
>ealth:ech ar$ue that: 5a6 the Restructurin$ A$ree#ent
$overns the choice of venue bet,een the parties, and 5b6
the a$ree#ent on the choice of venue #ust be interpreted
,ith the convenience of the parties in #ind and the vie,
that an1 obscurit1 therein ,as caused b1 9nion Ban?.
3(;4
On the other hand, 9nion Ban? contends that: 5a6
the Restructurin$ A$ree#ent is applicable onl1 to the
contract of loan, and not to the Real Estate Mort$a$e, and
5b6 the #ort$a$e contracts e*plicitl1 state that the choice of
venue e*clusivel1 belon$s to it.
30)4
Mean,hile, intervenor %. Hin$ I !ons Co#pan1,
Inc. adopts the position of 9nion Ban? and reiterates the
position that Cebu Cit1 is the proper venue.
30&4
:he sole issue to be resolved is ,hether Ma?ati
Cit1 is the proper venue to assail the foreclosure of the
sub=ect real estate #ort$a$e. :his Court rules in the
affir#ative.
Civil Case No. )&+&.<2, bein$ an action for
Annul#ent of !ale and :itles resultin$ fro# the
e*tra=udicial foreclosure b1 9nion Ban? of the #ort$a$ed
real properties, is classified as a real action. In Fortune
Motors v. Court of Appeals,
30(4
this Court held that a case
see?in$ to annul a foreclosure of a real estate #ort$a$e is a
real action, viz:
An action to annul a real
estate #ort$a$e foreclosure sale is no
different fro# an action to annul a
private sale of real propert1. (Muoz v.
Llamas, '2 Phil. 202, &;.)6.
Ehile it is true that petitioner
does not directl1 see? the recover1 of
title or possession of the propert1 in
Duestion, his action for annul#ent of
sale and his clai# for da#a$es are
closel1 intert,ined ,ith the issue of
o,nership of the buildin$ ,hich, under
the la,, is considered i##ovable
propert1, the recover1 of ,hich is
petitionerGs pri#ar1 ob=ective. :he
prevalent doctrine is that an action for
the annul#ent or rescission of a sale of
real propert1 does not operate to efface
the funda#ental and pri#e ob=ective
and nature of the case, ,hich is to
recover said real propert1. It is a real
action.
3004
Bein$ a real action, the filin$ and trial of the Civil
Case No. )&+&.<2 should be $overned b1 the follo,in$
relevant provisions of the Rules of Court 5the Rules6:
Rule -
AEN9E O@ AC:ION!
!ection &. Aenue of real
actions. B Actions affectin$ title to or
possession of real propert1, or interest
therein, shall be co##enced and
tried *n t6e proper ,ourt 76*,6 6a#
;ur*#d*,t*on o"er t6e area 76ere*n
t6e rea4 propert+ *n"o4"ed or a
port*on t6ereo( *# #*tuated.
@orcible entr1 and detainer
actions shall be co##enced and tried
in the #unicipal trial court of the
#unicipalit1 or cit1 ,herein the real
propert1 involved, or a portion thereof,
is situated.
!ec. 0. Ehen Rule not
applicable. B :his Rule shall not appl1
B
5a6 In those cases
,here a specific rule or la, provides
other,iseF or
5b6 <6ere t6e
part*e# 6a"e "a4*d4+ a3reed *n 7r*t*n3
)e(ore t6e (*4*n3 o( t6e a,t*on on t6e
e9,4u#*"e "enue t6ereo(. 5E#phasis
supplied.6
In Sps. Lantin v. Lantion,
30-4
this Court e*plained
that a venue stipulation #ust contain ,ords that sho,
e*clusivit1 or restrictiveness, as follo,s:
At the outset, ,e #ust #a?e
clear that under !ection - 5b6 of Rule -
of the &;;2 Rules of Civil Procedure,
the $eneral rules on venue of actions
shall not appl1 ,here the parties,
before the filin$ of the action, have
validl1 a$reed in ,ritin$ on an
e*clusive venue. :he #ere stipulation
on the venue of an action, ho,ever, is
not enou$h to preclude parties fro#
brin$in$ a case in other venues. T6e
part*e# mu#t )e a)4e to #6o7 t6at
#u,6 #t*pu4at*on *# e9,4u#*"e. In t6e
a)#en,e o( =ua4*(+*n3 or re#tr*,t*"e
7ord# t6e #t*pu4at*on #6ou4d )e
deemed a# mere4+ an a3reement on
an add*t*ona4 (orum not a# 4*m*t*n3
"enue to t6e #pe,*(*ed p4a,e.

* * * * *
* * * *

Clearl1, t6e 7ord#
>e9,4u#*"e4+? and >7a*"*n3 (or t6*#
purpo#e an+ ot6er "enue? are
re#tr*,t*"e and u#ed ad"*#ed4+ to
meet t6e re=u*rement#.
30.4
5E#phasis
supplied.6
Accordin$ to the Rules, real actions shall be
co##enced and tried in the court that has =urisdiction over
the area ,here the propert1 is situated. In this case, all the
#ort$a$ed properties are located in the Province of Cebu.
:hus, follo,in$ the $eneral rule, PA78A9M and
>ealth:ech should have filed their case in Cebu, and not in
Ma?ati.
>o,ever, the Rules provide an e*ception, in that
real actions can be co##enced and tried in a court other
than ,here the propert1 is situated in instances 76ere t6e
part*e# 6a"e pre"*ou#4+ and "a4*d4+ a3reed *n 7r*t*n3 on
t6e e9,4u#*"e "enue t6ereo(. In the case at bar, the parties
clai# that such an a$ree#ent e*ists. :he onl1 dispute is
,hether the venue that should be follo,ed is that contained
in the Real Estate Mort$a$es, as contended b1 9nion Ban?,
or that in the Restructurin$ A$ree#ent, as posited b1
PA78A9M and >ealth:ech. :his Court rules that t6e
"enue #t*pu4at*on *n t6e Re#tru,tur*n3 A3reement
#6ou4d )e ,ontro44*n3.
:he Real Estate Mort$a$es ,ere e*ecuted b1
PA78A9M in favor of 9nion Ban? to secure the credit
line e*tended b1 the latter to >ealth:ech. All three
#ort$a$e contracts contain a dra$net clause, ,hich secures
succeedin$ obli$ations, includin$ rene,als, e*tensions,
a#end#ents or novations thereof, incurred b1 >ealth:ech
fro# 9nion Ban?, to ,it:
!ection &. !ecured
Obli$ations. B :he obli$ations secured
b1 this Mort$a$e 5the J!ecured
Obli$ationsK6 are the follo,in$:

a6 All the
obli$ations of the Borro,er andLor the
Mort$a$or under: 5i6 the Notes, the
A$ree#ent, and this Mort$a$eF 5ii6 an1
and all instru#ents or docu#ents
issued upon the rene,al, e*tension,
a#end#ent or novation of the Notes,
the A$ree#ent and this Mort$a$e,
irrespective of ,hether such obli$ations
as rene,ed, e*tended, a#ended or
novated are in the nature of ne,,
separate or additional obli$ationsF and
5iii6 an1 and all instru#ents or
docu#ents issued pursuant to the
Notes, the A$ree#ent and this
Mort$a$eF

b6 All other
obli$ations of the Borro,er andLor the
Mort$a$or in favor of the Mort$a$ee,
,hether presentl1 o,in$ or hereinafter
incurred and ,hether or not arisin$
fro# or connected ,ith the A$ree#ent,
the Notes andLor this Mort$a$eF and

c6 An1 and all
e*penses ,hich #a1 be incurred in
collectin$ an1 and all of the above and
in enforcin$ an1 and all ri$hts, po,ers
and re#edies of the Mort$a$ee under
this Mort$a$e.
30<4
On the other hand, the Restructurin$ A$ree#ent
,as entered into b1 >ealth:ech and 9nion Ban? to #odif1
the entire loan obli$ation. !ection 2 thereof provides:
!ecurit1. B :he principal,
interests, penalties and other char$es
for ,hich the BORROEER #a1 be
bound to the BANH under the ter#s of
this Restructurin$ A$ree#ent,
includin$ the rene,al, e*tension,
a#end#ent or novation of this
Restructurin$ A$ree#ent, irrespective
of ,hether the obli$ations arisin$ out
of or in connection ,ith this
Restructurin$ A$ree#ent, as rene,ed,
e*tended, a#ended or novated, are in
the nature of ne,, separate or
additional obli$ations, and all other
instru#ents or docu#ents coverin$ the
Indebtedness or other,ise #ade
pursuant to this Restructurin$
A$ree#ent 5the J!ecured
Obli$ationsK6, shall continue to be
secured b1 the follo,in$ securit1
arran$e#ents 5t6e >Co44atera4#?6:

a. Rea4 E#tate
Mort3a3e dated %e)ruar+ --
-//8 e*ecuted b1 Pa$lau#
Mana$e#ent and /evelop#ent
Corporation over a -2- sDuare #eter
propert1 covered b1 TCT No. --:81/F

b. Rea4 E#tate
Mort3a3e dated %e)ruar+ --
Corporation over a (,2;< sDuare #eter
propert1 covered b1 TCT No. T!
@1A-@F

c. Rea4 E#tate
Mort3a3e dated Apr*4 ::
Corporation over a 0,2&& sDuare #eter
propert1 covered b1 TCT No. --:811F

d. Continuin$
!uret1 A$ree#ent of Ben=a#in B. /1F

Eithout need of an1 further
act and deed, the e*istin$ Collaterals,
shall re#ain in full force and effect and
continue to secure the pa1#ent and
perfor#ance of the obli$ations of the
BORROEER arisin$ fro# the Notes
and this Restructurin$ A$ree#ent.
3024
Mean,hile, !ection () of the Restructurin$
A$ree#ent as re$ards the venue of actions state:
(). Aenue B Aenue of an1
action or proceedin$ arisin$ out of or
connected ,ith this Re#tru,tur*n3
A3reement t6e Note t6e Co44atera4
and an+ and a44 re4ated
do,ument# shall be in Ma5at* C*t+,
3>ealth:ech4 and 39nion Ban?4
hereb1 7a*"*n3 an+ ot6er "enue.
30'4
:hese Duoted provisions of the Real Estate
Mort$a$es and the later Restructurin$ A$ree#ent clearl1
reveal the intention of the parties to i#ple#ent a restrictive
venue stipulation, ,hich applies not onl1 to the principal
obli$ation, but also to the #ort$a$es. :he phrase J7a*"*n3
an+ ot6er "enueK plainl1 sho,s that the choice of Ma?ati
Cit1 as the venue for actions arisin$ out of or in connection
,ith the Restructurin$ A$ree#ent and the Collateral, ,ith
the Real Estate Mort$a$es bein$ e*plicitl1 defined as such,
is e*clusive.
Even if this Court ,ere to consider the venue
stipulations under the Real Estate Mort$a$es, it #ust be
underscored that those provisions did not contain ,ords
sho,in$ e*clusivit1 or restrictiveness. In fact, in the Real
Estate Mort$a$es dated && @ebruar1 &;;-, the phrase
Jparties hereto ,aivin$K B fro# the entire phrase Jthe
parties hereto ,aivin$ an1 other venueK B ,as stric?en
fro# the final e*ecuted contract. @ollo,in$ the rulin$
in Sps. Lantin as earlier Duoted, in the absence of Dualif1in$
or restrictive ,ords, the venue stipulation should onl1 be
dee#ed as an a$ree#ent on an additional foru#, and not as
a restriction on a specified place.
Considerin$ that Ma?ati Cit1 ,as a$reed upon b1
the parties to be the venue for all actions arisin$ out of or in
connection ,ith the loan obli$ation incurred b1
>ealth:ech, as ,ell as the Real Estate Mort$a$es e*ecuted
b1 PA78A9M, the CA co##itted reversible error in
affir#in$ the dis#issal of Civil Case No. )&+&.<2 b1 R:C
Br. &0- on the $round of i#proper venue.
<HERE%ORE, the Petition for Revie,
is GRANTED. :he /ecision dated 0& Ma1 ())2 and
Resolution dated (- %ul1 ())2 in CA+7.R. CA No. '().0
of the Court of Appeals, as ,ell as the Orders dated &&
March ())0 and &; !epte#ber ())0 issued b1 the Re$ional
:rial Court, Ma?ati Cit1, Branch &0-,
are REVERSEDand SET ASIDE. :he Co#plaint in Civil
Case No. )&+&.<2 is hereb1 REINSTATED.
SO ORDERED.
THIRD DIVISION

LITTIE SARAH A. AGDEPPA
L&NN SARAH A. AGDEPPA
LOUELLA 'EANNE A. AGDEPPA
and LALAINE LILI$ETH A.
AGDEPPA
Petitioners,

+ versus +

HEIRS O% IGNACIO $ONETE
repre#ented )+ DOROTEA $ONETE
HIPOLITO $ONETE MILAGROS
$ONETE MAURICIO $ONETE
%ERNANDO $ONETE and OPHELIA
$ONETE
Respondents.

G.R. No.
-@88B@

Present:

CORONA, J.,
Chairperson,
AE8A!CO,
%R.,
NAC>9RA,
PERA8:A, and
MEN/OA, JJ
.

Pro#ul$ated:

%anuar1 &.,
()&)

5---------------------------------------------------------------------------
---------5

DECISION

NACHURA J.2

Before this Court is a Petition for Revie,
on Certiorari,
3&4
see?in$ the reversal of the Court of
Appeals 5CA6 /ecision,
3(4
dated /ece#ber (2, ())(,
,hich reversed and set aside the Order,
304
dated Ma1 (&,
&;;), issued b1 the Re$ional :rial Court 5R:C6, Branch
&', of Midsa1ap, Cotabato.

:he factual and procedural antecedents of the
case are as follo,s:

In &;2;, respondent /orotea Bonete 5/orotea6,
,ido, of the late I$nacio Bonete and #other of
respondents >ipolito Bonete, Mila$ros Bonete, Mauricio
Bonete, @ernando Bonete, and Ophelia Bonete
5respondents6, obtained a loan in the a#ount of P..,))).))
fro# /evelop#ent Ban? of the Philippines 5/BP6,
Cotabato Cit1 Branch, in order to bu1 far# i#ple#ents. A
parcel of a$ricultural land, ?no,n as 8ot No. 5&&--6 >+
()2'<. ,ith an area of &'.)) hectares, covered b1 :ransfer
Certificate of :itle 5:C:6 No. :+.<;(0,
3-4
issued in the
na#e of /orotea and situated in /e#apaco, 8ibun$an,
Cotabato 5sub=ect propert16, ,as used as collateral to
secure the said loan.

In &;'(, respondents, throu$h /orotea, received
a notice of collection fro# /BP. Respondents alle$ed that
herein petitioner and counsel, Att1. 8ittie !arah A.
A$deppa 58ittie !arah6, e*pressed deep concern and
s1#path1 for the#. ConseDuentl1, 8ittie !arah
acco#panied /orotea to /BP and obli$ated herself to pa1
the loan. :hereafter, /orotea ,as alle$edl1 #ade to si$n a
docu#ent as 8ittie !arahGs securit1 for the a#ount ,hich
the latter paid to /BP in connection ,ith the said
loan. @urther, respondents alle$ed that, since &;'(, 8ittie
!arah and her representatives had been $raduall1 easin$
the# out of the sub=ect propert1 and that the1 ,ere ordered
to stop the cultivation of their respective ricefields.
Eventuall1, respondents ,ere forcibl1 e=ected fro# the
sub=ect propert1.

@urther, 8ittie !arah planted corn and put up duc?+raisin$
pro=ects on the sub=ect propert1.

On this account, respondents inDuired fro# the
Re$ister of /eeds and found that the title to the sub=ect
propert1, ,hich ,as in the na#e of respondentsM
predecessor+in+interest, the late I$nacio Bonete, had
alread1 been canceled and transferred to 8ittie !arah under
:C: No. :+2.-.- b1 virtue of a purported deed of
sale. Accordin$ to /orotea, 8ittie !arah too? advanta$e of
her b1 lettin$ her si$n a contract, ostensibl1 as securit1 for
the loan fro# /BP, ,hich later turned out to be a deed of
sale. :hus, respondents filed a Co#plaint
3.4
for Recover1
of O,nership and Possession andLor Annul#ent of /eed of
!ale of the !ub=ect Propert1 ,ith /a#a$es, doc?eted as
Civil Case No. -'- before the R:C.

8ittie !arah filed a Motion to /is#iss
3<4
the
Co#plaint based on the follo,in$ $rounds: &6 that
respondents had no le$al capacit1 to sueF (6 that
respondents ,ere not the real parties in interestF 06 that
the Co#plaint stated no cause of actionF and -6 that the
clai# or de#and set forth in the Co#plaint had alread1
been ,aived and e*tin$uished.

8ater, the Co#plaint ,as a#ended, i#pleadin$
herein petitioners 81nn !arah A$deppa, 8ouella %eanne
A$deppa, and 8alaine 8ilibeth A$deppa, to$ether ,ith
8ittie !arah, as defendants 5petitioners6.
324
Respondents
also filed an Opposition to the Motion to /is#iss.
3'4

On Ma1 (&, &;;), the R:C issued an Order
dis#issin$ the A#ended Co#plaint ,ith costs a$ainst
respondents. It held that the A#ended Co#plaint did not
sho, the character and representation that respondents
clai#ed to have. :C: No. :+.<;(0, coverin$ the sub=ect
propert1, ,as not in the na#e of the late I$nacio Bonete
but in /oroteaMs na#e. :hus, the R:C held that
respondents ,ere not real parties in interest. Respondents
filed a Motion for Reconsideration
3;4
,hich the R:C
denied in its Order
3&)4
dated %anuar1 &(, &;;&. :herein, the
R:C held that respondents lac?ed the personalit1 to sueF
thus, a valid basis to $rant the #otion to dis#iss on the
$round that the co#plaint did not state a cause of action.

A$$rieved, respondents ,ent to the CA.
3&&4
On
/ece#ber (2, ())(, the CA reversed and set aside the
R:C Order, and re#anded the case to the R:C for further
proceedin$s because /orotea, bein$ the for#er o,ner of
the sub=ect propert1, ,as a real part1 in interest.

Petitioners filed their Motion for Reconsideration,
3&(4
,hich the CA denied in its Resolution
3&04
dated April (',
())-.

>ence, this Petition assi$nin$ the follo,in$ errors:

:>E >ONORAB8E CO9R:
O@ APPEA8! IN REAER!IN7 :>E
OR/ER O@ /I!MI!!A8 I!!9E/
B" :>E RE7IONA8 :RIA8
CO9R:, AC:E/ CON:RAR" :O
8AE AN/ %9RI!PR9/ENCEF
/EPAR:E/ @ROM :>E
ACCEP:E/ AN/ 9!9A8 CO9R!E
O@ %9/ICIA8 PROCEE/IN7!F
7RAAE8" ERRE/ AN/
7RAAE8" AB9!E/ I:!
/I!CRE:ION :AN:AMO9N: :O
8ACH O@ %9RI!/IC:IONF AN/
8AI/ /OEN A AER" BA/
PRECE/EN:, A! @O88OE!:

A. B"
AIO8A:IN7
!PECI@ICA88"
:>E
PROAI!ION! O@
:>E R98E! O@
CO9R:,
PAR:IC98AR8"
!EC!. ( AN/ 0
O@ R98E 0 O@
:>E R98E! O@
CO9R:, ON
PAR:IE!+
P8AIN:I@@! :O
CIAI8 AC:ION!
AN/ REA8
PAR:IE! IN
IN:ERE!:F

B. B"
9P>O8/IN7
:>E 8E7A8
CAPACI:" O@
:>E P8AIN:I@@!
>EIR! O@
I7NACIO
BONE:E :O !9E
AN/ :O @I8E
:>I! CA!E
E>EN :>E
>ONORAB8E
CO9R: O@
APPEA8! I:!E8@
EAEN
RI7>:@988"
@O9N/ :>A:
:C: NO. :+.<;(0
EA! A8REA/"
RE7I!:ERE/ IN
:>E NAME O@
/ORO:EA
BONE:E, E>EN
I: EA! !O8/ :O
>EREIN
/E@EN/AN:!,
!9C> :>A:
I7NACIO
BONE:E OR :>E
>EIR! O@
I7NACIO
BONE:E 3>A/4
NO:>IN7 :O /O
EI:> :>E !AI/
PROPER:"+
:>9!3,4 NO:
:>E REA8
PAR:" IN
IN:ERE!: AN/
3>A/4 NO
8E7A8
PER!ONA8I:"
:O !9E AN/
8IHEEI!E 3>A/4
NO CA9!E O@
AC:ION
A7AIN!:
/E@EN/AN:!
5PE:I:IONER!
>EREIN6F

C. :>A:
:>E /ECI!ION
O@ :>I!
>ONORAB8E
CO9R: O@
APPEA8! EA!
I!!9E/
CON:RAR" :O
8AE AN/
%9RI!PR9/ENCE
AN/ CON:RAR"
:O :>E :R9E,
AC:9A8 AN/
ENI!:IN7 @AC:!
O@ :>I! CA!E
AN/ EAEN :O
:>E AER"
@IN/IN7! O@
:>E >ONORAB
8E CO9R: O@
APPEA8!
I:!E8@,
BECA9!E
E>I8E
:>E >ONORAB
8E CO9R: O@
APPEA8! R98E/
:>A: /ORO:EA
BONE:E A!
RE7I!:ERE/
OENER I! A
PAR:" IN
IN:ERE!:, :>I!
CA!E I! NO:
PRO!EC9:E/ IN
:>E NAME O@
/ORO:EA
BONE:E, B9: IN
:>E NAME O@
:>E >EIR! O@
I7NACIO
BONE:E, AN/ I@
EAER :>E NAME
O@ /ORO:EA
BONE:E I!
MEN:IONE/ I:
EA! MERE8"
3AN/4
A88E7E/8" IN
REPRE!EN:A:I
ON O@ :>E
>EIR! O@
I7NACIO
BONE:E AN/
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3&-4

:he instant Petition is bereft of #erit.

Ehile it is true that respondents co##itted a
procedural infraction before the R:C, such infraction does
not =ustif1 the dis#issal of the case.

Mis=oinder of parties does not ,arrant the dis#issal
of the action.
3&.4
Rule 0, !ection && of the Rules of Court
clearl1 provides:

!ec. &&. Misjoinder and
nonjoinder of parties. O Neither
#is=oinder nor non+=oinder of parties is
$round for dis#issal of an action.
Parties #a1 be dropped or added b1
order of the court on #otion of an1
part1 or on its o,n initiative at an1
sta$e of the action and on such ter#s
as are =ust. An1 clai# a$ainst a
#is=oined part1 #a1 be severed and
proceeded ,ith separatel1.

It bears stressin$ that :C: No. :+.<;(0, coverin$ the
sub=ect propert1, ,as issued in the na#e of /orotea. :his is
established b1 the record, and petitioners the#selves ad#it
this fact. >o,ever, because :C: No. :+2.-.-, alle$edl1
issued in favor of 8ittie !arah, and the purported deed of
sale, alle$edl1 e*ecuted b1 /orotea in favor of 8ittie !arah,
are not on record. Considerin$ the alle$ations in the
pleadin$s, it is best that a trial on the #erits be conducted.

Ee full1 a$ree ,ith the apt and =udicious rulin$ of the
CA, ,hen it said:

As the for#er o,ner of the
sub=ect propert1, the sa#e havin$
been titled in her na#e under :C: No.
:+.<;(0, /orotea Caria$a Bonete,
bein$ the real part1 3in4 interest, has
the le$al capacit1 to file the instant
case for reconve1ance and annul#ent
of deed of sale. :he co#plaint ,as
filed b1 the 3respondents4 precisel1 to
Duestion the issuance of :C: No. :+
2.-.- in the na#e of 8ittie !arah
A$deppa as the transaction alle$edl1
conte#plated ,as onl1 to secure
/oroteaGs loan.

Eh1 the propert1 beca#e the
sub=ect of the deed of sale ,hich is
bein$ disputed b1 /orotea should be
threshed out in a full+blo,n trial on
the #erits in order to afford the
contendin$ parties their respective
da1s in
court. As held in !el "ros. #otel
Corporation vs. Court of Appeals, $%&
SCRA '', the co#plaint is not
supposed to contain evidentiar1
#atters as this ,ill have to be done at
the trial on the #erits of the case.

A final note.

A liberal construction of the Rules is apt in situations
involvin$ e*cusable for#al errors in a pleadin$, as lon$ as
the sa#e do not subvert the essence of the proceedin$, and
the1 connote at least a reasonable atte#pt at co#pliance
,ith the Rules.
3&<4
:he Court is not precluded fro#
rectif1in$ errors of =ud$#ent, if blind and stubborn
adherence to procedure ,ould result in the sacrifice of
substantial =ustice for technicalit1. :o deprive respondents,
particularl1 /orotea, of their clai#s over the sub=ect
propert1 on the stren$th of sheer technicalit1 ,ould be a
travest1 of =ustice and eDuit1.

<HERE%ORE, the instant Petition is DENIED and
the assailed Court of Appeals /ecision is A%%IRMED.
:he Re$ional :rial Court, Branch &' of Midsa1ap,
Cotabato, is hereb1 directed to resolve this case on the
#erits ,ith deliberate dispatch. Costs a$ainst petitioners.
THIRD DIVISION

ATT&. ROGELIO E. SARSA$A
Petitioner

! versus !

%E VDA. DE TE repre#ented )+ 6er Attorne+!*n!%a,t %AUSTINO CASTACEDA
Respondents.

G.R. No. -.A/-0

Pre#ent2

YNARES-SANTIAGO, J.,
Chairperson,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA, and
PERALTA, JJ.

Promulgated:
July 30, 2009
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

D E C I S I O N

PERALTA, J.:

Before u ! a "e#!#!on for re$!e%
on certiorari
&'(
%!#) "ra*er for "re+!,!nar* !n-un.#!on
aa!+!n/ #)e Order
&0(
da#ed 1ar.) 00, 0223 of #)e
Re/!ona+ Tr!a+ Cour# 4RTC5, Bran.) '6, 7!/o C!#*,
7a$ao de+ Sur, !n C!$!+ Cae No. 89::.

T)e fa.#, a .u++ed fro, #)e re.ord, fo++o%.

On ;e<ruar* '9, '66=, a 7e.!!on %a
rendered !n NLRC Cae No. RAB-''-2>-2232:-68
en#!#+ed, Patricio Sereno v. Teodoro Gasing/Truck
Operator, f!nd!n/ Sereno #o )a$e <een !++e/a++*
d!,!ed and order!n/ Ga!n/ #o "a* )!, )!
,one#ar* .+a!, !n #)e a,oun# of P98,323.9>. Af#er
#)e ?r!# of E@e.u#!on %a re#urned una#!f!ed, La<or
Ar<!#er Ne%#on R. San.)o !ued an A+!a ?r!# of
E@e.u#!on
&8(
on June '2, '663, d!re.#!n/ ;u+/en.!o R.
La$areA, S)er!ff II of #)e Na#!ona+ La<or Re+a#!on
Co,,!!on 4NLRC5, #o a#!f* #)e -ud/,en#
a%ard. On Ju+* 08, '663, La$areA, a..o,"an!ed <*
Sereno and )! .oune+, "e#!#!oner A##*. Ro/e+!o E.
Sara<a, +e$!ed a ;uo Tru.B <ear!n/ L!.ene P+a#e
No. LBR-='9, %)!.) a# #)a# #!,e %a !n #)e
"oe!on of Ga!n/. On Ju+* 82, '663, #)e #ru.B
%a o+d a# "u<+!. au.#!on, %!#) Sereno a""ear!n/ a
#)e )!/)e# <!dder.
&9(

1ean%)!+e, re"onden# ;e Vda. de Te,
re"reen#ed <* )er a##orne*-!n-fa.#, ;au#!no
Ca#aCeda, f!+ed %!#) #)e RTC, Bran.) ':, 7!/o,
7a$ao de+ Sur, a Co,"+a!n#
&=(
for re.o$er* of ,o#or
$e)!.+e, da,a/e %!#) "ra*er for #)e de+!$er* of #)e
#ru.B pendente lite a/a!n# "e#!#!oner, Sereno, La$areA
and #)e NLRC of 7a$ao C!#*, do.Be#ed a C!$!+ Cae
No. 89::.

Re"onden# a++e/ed #)a#D 4'5 )e ! #)e %!fe of
#)e +a#e Pedro Te, #)e re/!#ered o%ner of #)e #ru.B,
a e$!den.ed <* #)e Off!.!a+ Re.e!"#
&3(
and Cer#!f!.a#e
of Re/!#ra#!onE
&>(
405 Ga!n/ ,ere+* ren#ed #)e #ru.B
fro, )erE 485 La$areA erroneou+* au,ed #)a#
Ga!n/ o%ned #)e #ru.B <e.aue )e %a, a# #)e #!,e
of #)e F#aB!n/,G
&:(
!n "oe!on of #)e a,eE and 495
!n.e ne!#)er )e nor )er )u<and %ere "ar#!e #o #)e
+a<or .ae <e#%een Sereno and Ga!n/, )e )ou+d
no# <e ,ade #o an%er for #)e -ud/,en# a%ard, ,u.)
+e <e de"r!$ed of #)e #ru.B a a .oneHuen.e of #)e
+e$* !n e@e.u#!on.

Pe#!#!oner f!+ed a 1o#!on #o 7!,!
&6(
on #)e
fo++o%!n/ /roundD 4'5 re"onden# )a no +e/a+
"erona+!#* #o ue, )a$!n/ no rea+ !n#ere# o$er #)e
"ro"er#* u<-e.# of #)e !n#an# .o,"+a!n#E 405 #)e
a++e/a#!on !n #)e .o,"+a!n# do no# uff!.!en#+* #a#e
#)a# #)e re"onden# )a .aue of a.#!onE 485 #)e
a++e/a#!on !n #)e .o,"+a!n# do no# .on#a!n uff!.!en#
.aue of a.#!on a a/a!n# )!,E and 495 #)e .o,"+a!n#
! no# a..o,"an!ed <* an Aff!da$!# of 1er!# and Bond
#)a# %ou+d en#!#+e #)e re"onden# #o #)e de+!$er* of #)e
#u.B pendente lite.

T)e NLRC a+o f!+ed a 1o#!on #o 7!,!
&'2(
on
#)e /round of +a.B of -ur!d!.#!on and +a.B of .aue of
a.#!on.

1ean%)!+e, La$areA f!+ed an An%er %!#)
Co,"u+or* Coun#er.+a!, and T)!rd-Par#* Co,"+a!n#.
&''(
B* %a* of "e.!a+ and aff!r,a#!$e defene, )e
aer#ed #)a# #)e RTC doe no# )a$e -ur!d!.#!on o$er
#)e u<-e.# ,a##er and #)a# #)e .o,"+a!n# doe no#
#a#e a .aue of a.#!on.

On Januar* 0', 0222, #)e RTC !ued an
Order
&'0(
den*!n/ "e#!#!onerI 1o#!on #o 7!,! for
+a.B of ,er!#.

In )! An%er,
&'8(
"e#!#!oner den!ed #)e ,a#er!a+
a++e/a#!on !n #)e .o,"+a!n#. S"e.!f!.a++*, )e .!#ed a
aff!r,a#!$e defene #)a#D re"onden# )ad no +e/a+
"erona+!#* #o ue, a )e )ad no !n#ere# o$er #)e
,o#or $e)!.+eE #)a# #)ere %a no )o%!n/ #)a# #)e
)e!r )a$e f!+ed an !n#e#a#e e#a#e "ro.eed!n/ of #)e
e#a#e of Pedro Te, or #)a# re"onden# %a du+*
au#)or!Aed <* )er .o-)e!r #o f!+e #)e .aeE and #)a#
#)e #ru.B %a a+read* o+d #o Ga!n/ on 1ar.) '',
'6:3 <* one Jeu 1a#!a, %)o <ou/)# #)e a,e
fro, #)e S"oue Te. Coro++ar!+*, Ga!n/ %a
a+read* #)e +a%fu+ o%ner of #)e #ru.B %)en !# %a
+e$!ed on e@e.u#!on and, +a#er on, o+d a# "u<+!.
au.#!on.

In.!den#a++*, La$areA f!+ed a 1o#!on for
In)!<!#!on,
&'9(
%)!.) %a o""oed
&'=(
<* re"onden#.

On O.#o<er '8, 0222, RTC Bran.) ': !ued
an Order
&'3(
of !n)!<!#!on and d!re.#ed #)e #ranfer of
#)e re.ord #o Bran.) '6. RTC Bran.) '6, )o%e$er,
re#urned #)e re.ord <a.B #o Bran.) ': !n $!e% of #)e
a""o!n#,en# of a ne% -ud/e !n "+a.e of Jud/e-
de!/na#e Rodo+fo A. E.o$!++a. Ye#, Bran.) '6
!ued ano#)er Order
&'>(
da#ed No$e,<er 00,
0222 re#a!n!n/ #)e .ae !n a!d <ran.).

E$en#ua++*, #)e RTC !ued an
Order
&':(
da#ed 1a* '6, 0228 den*!n/ #)e e"ara#e
,o#!on #o d!,! f!+ed <* #)e NLRC and La$areA,
and e##!n/ #)e Pre-Tr!a+ Conferen.e on Ju+* 0=,
0228.

On O.#o<er '>, 022=, "e#!#!oner f!+ed an
O,n!<u 1o#!on #o 7!,! #)e Cae on #)e fo++o%!n/
/roundD
&'6(
4'5 +a.B of -ur!d!.#!on o$er one of #)e
"r!n.!"a+ defendan#E and 405 #o d!.)ar/e
re"onden#I a##orne*-!n-fa.# for +a.B of +e/a+
"erona+!#* #o ue.

I# a""eared #)a# #)e re"onden#, ;e Vda. de Te,
d!ed on A"r!+ '0, 022=.
&02(

Re"onden#, #)rou/) )er +a%*er, A##*. ?!++!a,
G. Car"en#ero, f!+ed an O""o!#!on,
&0'(
.on#end!n/ #)a#
#)e fa!+ure #o er$e u,,on u"on Sereno ! no# a
/round for d!,!!n/ #)e .o,"+a!n#, <e.aue #)e
o#)er defendan# )a$e a+read* u<,!##ed #)e!r
re"e.#!$e re"on!$e "+ead!n/. He a+o .on#ended
#)a# #)e defendan#, !n.+ud!n/ )ere!n "e#!#!oner, )ad
"re$!ou+* f!+ed e"ara#e ,o#!on #o d!,! #)e
.o,"+a!n#, %)!.) #)e RTC den!ed for +a.B of
,er!#. 1oreo$er, re"onden#I dea#) d!d no#
render functus officio )er r!/)# #o ue !n.e )er
a##orne*-!n-fa.#, ;au#!no Ca#aCeda, )ad +on/
#e#!f!ed on #)e .o,"+a!n# on 1ar.) '8, '66: for and
on )er <e)a+f and, a..ord!n/+*, u<,!##ed
do.u,en#ar* e@)!<!# !n u""or# of #)e .o,"+a!n#.

On 1ar.) 00, 0223, #)e RTC !ued #)e
aa!+ed Order
&00(
den*!n/ "e#!#!onerI aforea!d
,o#!on.

Pe#!#!oner #)en f!+ed a 1o#!on for
Re.on!dera#!on %!#) 1o#!on for In)!<!#!on,
&08(
!n %)!.)
)e .+a!,ed #)a# #)e -ud/e %)o !ued #)e Order %a
<!aed and "ar#!a+. He %en# on #o #a#e #)a# #)e
-ud/eI )u<and %a #)e defendan# !n a "e#!#!on for
-ud!.!a+ re.o/n!#!on of %)!.) )e %a #)e .oune+,
do.Be#ed a C!$!+ Cae No. C-JJI-'22, <efore #)e
RTC, Bran.) 0', Bana+an, 7a$ao de+ Sur. T)u,
"ro"r!e#* d!.#a#e #)a# #)e -ud/e )ou+d !n)!<!# )ere+f
fro, #)e .ae.

A.#!n/ on #)e ,o#!on for !n)!<!#!on, Jud/e
Car,e+!#a Sarno-7a$!n /ran#ed #)e a,e
&09(
and
ordered #)a# #)e .ae <e re-raff+ed #o Bran.)
':. E$en#ua++*, #)e a!d RTC !ued an
Order
&0=(
on O.#o<er '3, 0223 den*!n/ "e#!#!onerI
,o#!on for re.on!dera#!on for +a.B of ,er!#.

Hen.e, "e#!#!oner d!re.#+* ou/)# re.oure fro,
#)e Cour# $!a #)e "reen# "e#!#!on !n$o+$!n/ "ure
Hue#!on of +a%, %)!.) )e .+a!,ed %ere reo+$ed <*
#)e RTC .on#rar* #o +a%, ru+e and e@!#!n/
-ur!"ruden.e.
&03(

T)ere ! a Fquesto! o" la#G %)en #)e dou<# or
d!fferen.e ar!e a #o %)a# #)e +a% ! on .er#a!n #a#e
of fa.#, and %)!.) doe no# .a++ for an e@a,!na#!on of
#)e "ro<a#!$e $a+ue of #)e e$!den.e "reen#ed <* #)e
"ar#!e-+!#!/an#. On #)e o#)er )and, #)ere ! a
Fquesto! o" "a$tG %)en #)e dou<# or .on#ro$er*
ar!e a #o #)e #ru#) or fa+!#* of #)e a++e/ed
fa.#. S!,"+* "u#, %)en #)ere ! no d!"u#e a #o fa.#,
#)e Hue#!on of %)e#)er or no# #)e .on.+u!on dra%n
#)erefro, ! .orre.#, ! a Hue#!on of +a%.
&0>(

Ver!+*, #)e !ue ra!ed <* )ere!n "e#!#!oner
are FHue#!on of +a%,G a #)e!r reo+u#!on re# o+e+*
on %)a# #)e +a% "ro$!de /!$en #)e e# of
.!r.u,#an.e a$a!+!n/. T)e f!r# !ue !n$o+$e #)e
-ur!d!.#!on of #)e .our# o$er #)e "eron of one of #)e
defendan#, %)o %a no# er$ed %!#) u,,on on
a..oun# of )! dea#). T)e e.ond !ue, on #)e o#)er
)and, "er#a!n #o #)e +e/a+ effe.# of dea#) of #)e
"+a!n#!ff dur!n/ #)e "enden.* of #)e .ae.

A# f!r# <ru), !# ,a* a""ear #)a# !n.e "ure
Hue#!on of +a% %ere ra!ed, "e#!#!onerI reor# #o #)!
Cour# %a -u#!f!ed and #)e reo+u#!on of #)e
afore,en#!oned !ue %!++ ne.ear!+*
fo++o%. Ho%e$er, a "erua+ of #)e "e#!#!on reHu!re
#)a# .er#a!n "ro.edura+ !ue ,u# !n!#!a++* <e
reo+$ed <efore ?e de+$e !n#o #)e ,er!# of #)e .ae.

No#a<+*, #)e "e#!#!on %a f!+ed d!re.#+* fro,
#)e RTC %)!.) !ued #)e Order !n #)e e@er.!e of !#
or!/!na+ -ur!d!.#!on. T)e Hue#!on <efore U #)en !D
%)e#)er or no# "e#!#!oner .orre.#+* a$a!+ed of #)e ,ode
of a""ea+ under Ru+e 9= of #)e Ru+e of Cour#.

S!/n!f!.an#+*, #)e ru+e on a""ea+ ! ou#+!ned
<e+o%, #o %!#D
&0:(

4'5 In a++ $ases de$ded %& t'e RTC ! t'e
exer$se o" ts org!al (ursd$to!,
a""ea+ ,a* <e ,ade #o #)e Cour# of
A""ea+ <* ,ere no#!.e of a""ea+
%)ere #)e a""e++an# ra!e Hue#!on
of fa.# or ,!@ed Hue#!on of fa.# and
+a%E

405 In a++ $ases de$ded %& t'e RTC ! t'e
exer$se o" ts org!al
(ursd$to! #'ere t'e a))ella!t
rases o!l& questo!s o" la#, #)e
a""ea+ ,u# <e #aBen #o #)e Su"re,e
Cour# on a "e#!#!on for re$!e%
on certiorari under Ru+e 9=.

485 A++ a""ea+ fro, -ud/,en# rendered <*
#)e RTC !n #)e e@er.!e of !#
a""e++a#e -ur!d!.#!on, re/ard+e of
%)e#)er #)e a""e++an# ra!e
Hue#!on of fa.#, Hue#!on of +a%, or
,!@ed Hue#!on of fa.# and +a%, )a++
<e <rou/)# #o #)e Cour# of A""ea+ <*
f!+!n/ a "e#!#!on for re$!e% under Ru+e
90.

A..ord!n/+*, an a""ea+ ,a* <e #aBen fro,
#)e RTC %)!.) e@er.!ed !# or!/!na+ -ur!d!.#!on,
<efore #)e Cour# of A""ea+ or d!re.#+* <efore #)!
Cour#, "ro$!ded #)a# #)e u<-e.# of #)e a,e !
a (udgme!t or "!al order #)a# .o,"+e#e+* d!"oe
of #)e .ae, or of a "ar#!.u+ar ,a##er #)ere!n %)en
de.+ared <* #)e Ru+e #o <e a""ea+a<+e.
&06(
T)e f!r#
,ode of a""ea+, #o <e f!+ed <efore #)e Cour# of
A""ea+, "er#a!n #o a %r!# of error under Se.#!on 04a5,
Ru+e 9' of #)e Ru+e of Cour#, !f Hue#!on of fa.# or
Hue#!on of fa.# and +a% are ra!ed or !n$o+$ed. On
#)e o#)er )and, #)e e.ond ,ode ! <* %a* of an
a""ea+ <* certiorari <efore #)e Su"re,e Cour# under
Se.#!on 04.5, Ru+e 9', !n re+a#!on #o Ru+e 9=, %)ere
on+* Hue#!on of +a% are ra!ed or !n$o+$ed.
&82(

An order or -ud/,en# of #)e RTC !
dee,ed "!al %)en !# f!na++* d!"oe of a "end!n/
a.#!on, o #)a# no#)!n/ ,ore .an <e done %!#) !# !n #)e
#r!a+ .our#. In o#)er %ord, #)e order or -ud/,en#
end #)e +!#!/a#!on !n #)e +o%er .our#.
&8'(
On #)e o#)er
)and, an order %)!.) doe no# d!"oe of #)e .ae
.o,"+e#e+* and !nd!.a#e #)a# o#)er #)!n/ re,a!n #o
<e done <* #)e .our# a re/ard #)e ,er!#,
! !terlo$utor&. Interlocutory refer #o o,e#)!n/
<e#%een #)e .o,,en.e,en# and #)e end of #)e u!#
%)!.) de.!de o,e "o!n# or ,a##er, <u# ! no# a f!na+
de.!!on on #)e %)o+e .on#ro$er*.
&80(

T)e u<-e.# of #)e "reen# "e#!#!on ! an
Order of #)e RTC, %)!.) den!ed "e#!#!onerI O,n!<u
1o#!on #o 7!,!, for +a.B of ,er!#.

?e )a$e a!d #!,e and a/a!n #)a# an order
den*!n/ a ,o#!on #o d!,! ! !n#er+o.u#or*.
&88(
Under
Se.#!on '4.5, Ru+e 9' of #)e Ru+e of Cour#, an
!n#er+o.u#or* order ! no# a""ea+a<+e. A a re,ed*
for #)e den!a+, a "ar#* )a #o f!+e an an%er and
!n#er"oe a a defene #)e o<-e.#!on ra!ed !n #)e
,o#!on, and #)en #o "ro.eed #o #r!a+E or, a "ar#* ,a*
!,,ed!a#e+* a$a!+ of #)e re,ed* a$a!+a<+e #o #)e
a//r!e$ed "ar#* <* f!+!n/ an a""ro"r!a#e "e.!a+ .!$!+
a.#!on for certiorari under Ru+e 3= of #)e Re$!ed
Ru+e of Cour#. Le# !# <e #reed #)ou/) #)a# a
"e#!#!on for certiorari ! a""ro"r!a#e on+* %)en an order
)a <een !ued %!#)ou# or !n e@.e of -ur!d!.#!on, or
%!#) /ra$e a<ue of d!.re#!on a,oun#!n/ #o +a.B or
e@.e of -ur!d!.#!on.

Baed on #)e fore/o!n/, #)e Order of #)e RTC
den*!n/ "e#!#!onerI O,n!<u 1o#!on #o 7!,! ! no#
a""ea+a<+e e$en on "ure Hue#!on of +a%. I# ! %or#)
,en#!on!n/ #)a# #)e "ro"er "ro.edure !n #)! .ae, a
enun.!a#ed <* #)! Cour#, ! #o .!#e u.) !n#er+o.u#or*
order a an error !n #)e a""ea+ of #)e .ae -- !n #)e
e$en# #)a# #)e RTC ru+e !n fa$or of re"onden# -- and
no# #o a""ea+ u.) !n#er+o.u#or* order. On #)e o#)er
)and, !f #)e "e#!#!on ! #o <e #rea#ed a a "e#!#!on for
re$!e% under Ru+e 9=, !# %ou+d +!Be%!e fa!+ <e.aue
#)e "ro"er u<-e.# %ou+d on+* <e -ud/,en# or f!na+
order #)a# .o,"+e#e+* d!"oe of #)e .ae.
&89(

No# <e!n/ a "ro"er u<-e.# of an a""ea+, #)e
Order of #)e RTC ! .on!dered
!n#er+o.u#or*. Pe#!#!oner )ou+d
)a$e "ro.eeded %!#) #)e #r!a+ of #)e .ae and, )ou+d
#)e RTC e$en#ua++* render an unfa$ora<+e $erd!.#,
"e#!#!oner )ou+d aa!+ #)e a!d Order a "ar# of an
a""ea+ #)a# ,a* <e #aBen fro, #)e f!na+ -ud/,en# #o
<e rendered !n #)! .ae. Su.) ru+e ! founded on
.on!dera#!on of order+*
"ro.edure, #o fore#a++ ue+e a""ea+ and a$o!d
undue !n.on$en!en.e #o #)e a""ea+!n/ "ar#* <*
)a$!n/ #o aa!+ order a #)e* are "ro,u+/a#ed <*
#)e .our#, %)en a++ u.) order ,a* <e .on#e#ed !n a
!n/+e a""ea+.

In one .ae,
&8=(
#)e Cour# ad$er#ed #o #)e
)aAard of !n#er+o.u#or* a""ea+D

It is a*io#atic that an interlocutor1
order cannot be challen$ed b1 an
appeal. :hus, it has been held that Jthe
proper re#ed1 in such cases is an
ordinar1 appeal fro# an adverse
=ud$#ent on the merits, incorporatin$
in said appeal the $rounds for assailin$
the interlocutor1 order. Allo,in$
appeals fro# interlocutor1 orders
,ould result in the Psorr1 spectacleG of
a case bein$ sub=ect of a
counterproductive pin(pon( to and
fro# the appellate court as often as a
trial court is perceived to have #ade an
error in an1 of its interlocutor1
rulin$s. * * *.

Ano#)er re.o/n!Aed reaon of #)e +a% !n
"er,!##!n/ a""ea+ on+* fro, a f!na+ order or -ud/,en#,
and no# fro, an !n#er+o.u#or* or !n.!den#a+ one, ! #o
a$o!d ,u+#!"+!.!#* of a""ea+ !n a !n/+e a.#!on, %)!.)
,u# ne.ear!+* u"end #)e )ear!n/ and de.!!on
on #)e ,er!# of #)e .ae dur!n/ #)e "enden.* of #)e
a""ea+. If u.) a""ea+ %ere a++o%ed, #r!a+ on #)e
,er!# of #)e .ae %ou+d ne.ear!+* <e de+a*ed for a
.on!dera<+e +en/#) of #!,e and .o,"e+ #)e ad$ere
"ar#* #o !n.ur unne.ear* e@"ene, for one of #)e
"ar#!e ,a* !n#er"oe a ,an* a""ea+ a !n.!den#a+
Hue#!on ,a* <e ra!ed <* )!,, and !n#er+o.u#or*
order rendered or !ued <* #)e +o%er .our#.
&83(

And, e$en !f ?e #rea# #)e "e#!#!on #o )a$e
<een f!+ed under Ru+e 3=, #)e a,e ! #!++ d!,!!<+e
for $!o+a#!n/ #)e "r!n.!"+e on )!erar.)* of
.our#. Genera++*, a d!re.# reor# #o u !n a "e#!#!on
for certiorari ! )!/)+* !,"ro"er, for !# $!o+a#e #)e
e#a<+!)ed "o+!.* of #r!.# o<er$an.e of #)e -ud!.!a+
)!erar.)* of .our#.
&8>(
T)! "r!n.!"+e, a a ru+e,
reHu!re #)a# re.oure ,u# f!r# <e ,ade #o #)e
+o%er-ranBed .our# e@er.!!n/ .on.urren# -ur!d!.#!on
%!#) a )!/)er .our#. Ho%e$er, #)e -ud!.!a+ )!erar.)*
of .our# ! no# an !ron-.+ad ru+e. A #r!.# a""+!.a#!on
of #)e ru+e ! no# ne.ear* %)en .ae <rou/)#
<efore #)e a""e++a#e .our# do no# !n$o+$e fa.#ua+
<u# +e/a+ Hue#!on.
&8:(

In #)e "reen# .ae, "e#!#!oner u<,!# "ure
Hue#!on of +a% !n$o+$!n/ #)e effe.# of non-er$!.e of
u,,on fo++o%!n/ #)e dea#) of #)e "eron #o %)o, !#
)ou+d <e er$ed, and #)e effe.# of #)e dea#) of #)e
.o,"+a!nan# dur!n/ #)e "enden.* of #)e .ae. ?e
dee, !# <e# #o ru+e on #)ee !ue, no# on+* for #)e
<enef!# of #)e <en.) and <ar, <u# !n order #o "re$en#
fur#)er de+a* !n #)e #r!a+ of #)e .ae. Reu+#an#+*, our
re+a@a#!on of #)e "o+!.* of #r!.# o<er$an.e of #)e
-ud!.!a+ )!erar.)* of .our# ! %arran#ed.

Anen# #)e f!r# !ue, "e#!#!oner ar/ue #)a#,
!n.e Sereno d!ed <efore u,,on %a er$ed on
)!,, #)e RTC )ou+d )a$e d!,!ed #)e .o,"+a!n#
a/a!n# a++ #)e defendan# and #)a# #)e a,e )ou+d
<e f!+ed a/a!n# )! e#a#e.

T)e S)er!ffI Re#urn of Ser$!.e
&86(
da#ed 1a*
'6, '66> #a#e #)a# Sereno .ou+d no# <e er$ed %!#)
.o"* of #)e u,,on, #o/e#)er %!#) a .o"* of #)e
.o,"+a!n#, <e.aue )e %a a+read* dead.

In $!e% of SerenoI dea#), "e#!#!oner aB
#)a# #)e .o,"+a!n# )ou+d <e d!,!ed, no#
on+* a/a!n# Sereno, <u# a #o a++ #)e
defendan#, .on!der!n/ #)a# #)e RTC d!d no# a.Hu!re
-ur!d!.#!on o$er #)e "eron of Sereno.

%urisdiction over a part1 is acDuired b1 service of
su##ons b1 the sheriff, his deput1 or other proper court
officer, either personall1 b1 handin$
a cop1 thereof to the defendant or b1 substituted servic
e.
3-)4
On the other
hand, su##ons is a ,rit b1 ,hich the defendant is notified
of the action brou$ht a$ainst hi#. !ervice of such ,rit is
the #eans b1 ,hich the court #a1 acDuire =urisdiction over
his person.
3-&4

Records sho, that petitioner had filed a Motion to
/is#iss on the $rounds of lac? of le$al personalit1 of
respondentF the alle$ations in the co#plaint did not
sufficientl1 state that respondent has a cause of action or a
cause of action a$ainst the defendantsF and, the co#plaint
,as not acco#panied b1 an affidavit of #erit and
bond. :he R:C denied the #otion and held therein that,
on the basis of the alle$ations of fact in the co#plaint, it
can render a valid =ud$#ent. Petitioner, subseDuentl1,
filed his ans,er b1 den1in$ all the #aterial alle$ations of
the co#plaint. And b1 ,a1 of special and affir#ative
defenses, he reiterated that respondent had no le$al
personalit1 to sue as she had no real interest over the
propert1 and that ,hile the truc? ,as still re$istered in
Pedro :eMs na#e, the sa#e ,as alread1 sold to 7asin$.

!i$nificantl1, a #otion to dis#iss #a1 be filed ,ithin
the ti#e for but before the filin$ of an ans,er to the
co#plaint or pleadin$ assertin$ a clai#.
3-(4
A#on$ the
$rounds #entioned is the courtMs lac? of =urisdiction over
the person of the defendin$ part1.

As a rule, all defenses and ob=ections not pleaded,
either in a #otion to dis#iss or in an ans,er, are dee#ed
,aived.
3-04
:he e*ceptions to this rule are: 5&6 ,hen the
court has no =urisdiction over the sub=ect #atter, 5(6 ,hen
there is another action pendin$ bet,een the parties for
the sa#e cause, or 506 ,hen the action is barred b1 prior
=ud$#ent or b1 statute of li#itations, in ,hich cases, the
court #a1 dis#iss the clai#.

In the case before 9s, petitioner raises the issue of
lac? of =urisdiction over the person of !ereno, not in his
Motion to /is#iss or in his Ans,er but onl1 in his
O#nibus Motion to /is#iss. >avin$ failed to invo?e this
$round at the proper ti#e, that is, in a #otion to dis#iss,
petitioner cannot raise it no, for the first ti#e on appeal.

In fine, Ee cannot countenance petitionerMs ar$u#ent
that the co#plaint a$ainst the other defendants should have
been dis#issed, considerin$ that the R:C never acDuired
=urisdiction over the person of !ereno. :he courtMs failure
to acDuire =urisdiction over oneMs person is a defense ,hich
is personal to the person clai#in$ it. Obviousl1, it is no,
i#possible for !ereno to invo?e the sa#e in vie, of his
death. Neither can petitioner invo?e such $round, on
behalf of !ereno, so as to reap the benefit of havin$ the
case dis#issed a$ainst all of the defendants. @ailure to
serve su##ons on !erenoMs person ,ill not be a cause for
the dis#issal of the co#plaint a$ainst the other defendants,
considerin$ that the1 have been served ,ith copies of the
su##ons and co#plaints and have lon$ sub#itted their
respective responsive pleadin$s. In fact, the other
defendants in the co#plaint ,ere $iven the chance to raise
all possible defenses and ob=ections personal to the# in
their respective #otions to dis#iss and their subseDuent
ans,ers.

Ee a$ree ,ith the R:C in its Order ,hen it resolved
the issue in this ,ise:
A .orre.#+* "o!n#ed <*
defendan#, #)e Honora<+e Cour#
)a no# a.Hu!red -ur!d!.#!on o$er
#)e "eron of Pa#r!.!o Sereno !n.e
#)ere %a !ndeed no $a+!d er$!.e of
u,,on !nofar a Pa#r!.!o
Sereno ! .on.erned. Pa#r!.!o
Sereno d!ed <efore #)e u,,on,
#o/e#)er %!#) a .o"* of #)e
.o,"+a!n# and !# anne@e, .ou+d <e
er$ed u"on )!,.

Ho%e$er, #)e fa!+ure #o
effe.# er$!.e of u,,on un#o
Pa#r!.!o Sereno, one of #)e
defendan# )ere!n doe no# render
#)e a.#!on 7IS1ISSIBLE,
.on!der!n/ #)a# #)e #)ree 485 o#)er
defendan#, na,e+*, A##*. Ro/e+!o
E. Sara<a, ;u+/en.!o La$are and
#)e NLRC, %ere $a+!d+* er$ed %!#)
u,,on and #)e .ae %!#)
re"e.# #o #)e an%er!n/
defendan# ,a* #!++ "ro.eed
!nde"enden#+*. Be !# re.a++ed #)a#
#)e #)ree 485 an%er!n/ defendan#
)a$e "re$!ou+* f!+ed a 1o#!on #o
7!,! #)e Co,"+a!n# %)!.) %a
den!ed <* #)e Cour#.

Hen.e, on+* #)e .ae
a/a!n# Pa#r!.!o Sereno %!++ <e
7IS1ISSE7 and #)e a,e ,a* <e
f!+ed a a .+a!, a/a!n# #)e e#a#e of
Pa#r!.!o Sereno, <u# #)e .ae %!#)
re"e.# #o #)e #)ree 485 o#)er
a..ued %!++ "ro.eed.

Anent the second issue, petitioner #oves that
respondentMs attorne1+in+fact, @austino CastaQeda, be
dischar$ed as he has no #ore le$al personalit1 to sue on
behalf of @e Ada. de :e, ,ho passed a,a1 on April &(,
())., durin$ the pendenc1 of the case before the R:C.

Ehen a part1 to a pendin$ action dies and the clai#
is not e*tin$uished, the Rules of Court reDuire a
substitution of the deceased.
3--4
!ection &, Rule '2 of the
Rules of Court enu#erates the actions that survived and
#a1 be filed a$ainst the decedentMs representatives as
follo,s: 5&6 actions to recover real or personal propert1 or
an interest thereon, 5(6 actions to enforce liens thereon, and
506 actions to recover da#a$es for an in=ur1 to a person or a
propert1. In such cases, a counsel is obli$ed to infor# the
court of the death of his client and $ive the na#e and
address of the latterMs le$al representative.
3-.4

:he rule on substitution of parties is $overned b1
!ection &<,
3-<4
Rule 0 of the &;;2 Rules of Civil Procedure,
as a#ended.

!trictl1 spea?in$, the rule on substitution b1 heirs is
not a #atter of =urisdiction, but a reDuire#ent of due
process. :he rule on substitution ,as crafted to protect
ever1 part1Ms ri$ht to due process. It ,as desi$ned to
ensure that the deceased part1 ,ould continue to be
properl1 represented in the suit throu$h his heirs or the dul1
appointed le$al representative of his estate. Moreover,
non+co#pliance ,ith the Rules results in the denial of the
ri$ht to due process for the heirs ,ho, thou$h not dul1
notified of the proceedin$s, ,ould be substantiall1 affected
b1 the decision rendered therein. :hus, it is onl1 ,hen
there is a denial of due process, as ,hen the deceased is not
represented b1 an1 le$al representative or heir, that the
court nullifies the trial proceedin$s and the resultin$
=ud$#ent therein.
3-24

In the case before 9s, it appears that respondentMs
counsel did not #a?e an1 #anifestation before the R:C as
to her death. In fact, he had activel1 participated in the
proceedin$s. Neither had he sho,n an1 proof that he had
been retained b1 respondentMs le$al representative or an1
one ,ho succeeded her.

>o,ever, such failure of counsel ,ould not lead 9s
to invalidate the proceedin$s that have lon$ ta?en place
before the R:C. :he Court has repeatedl1 declared that
failure of the counsel to co#pl1 ,ith his dut1 to infor# the
court of the death of his client, such that no substitution is
effected, ,ill not invalidate the proceedin$s and the
=ud$#ent rendered thereon if the action survives the death
of such part1. :he trial courtMs =urisdiction over the case
subsists despite the death of the part1.
3-'4

:he purpose behind this rule is the protection of the
ri$ht to due process of ever1 part1 to the liti$ation ,ho
#a1 be affected b1 the intervenin$ death. :he deceased
liti$ants are the#selves protected as the1 continue to be
properl1 represented in the suit throu$h the dul1 appointed
le$al representative of their estate.
3-;4

Anent the clai# of petitioner that the special po,er of
attorne1
3.)4
dated March -, &;;2 e*ecuted b1 respondent in
favor of @austino has beco#e fun)tus offi)ioand that the
a$enc1 constituted bet,een the# has been e*tin$uished
upon the death of respondent, corollaril1, he had no #ore
personalit1 to appear and prosecute the case on her behalf.

A$enc1 is e*tin$uished b1 the death of the principal.
3.&4
:he onl1 e*ception ,here the a$enc1 shall re#ain in
full force and effect even after the death of the principal is
,hen if it has been constituted in the co##on interest of
the latter and of the a$ent, or in the interest of a third
person ,ho has accepted the stipulation in his favor.
3.(4

A perusal of the special po,er of attorne1 leads us to
conclude that it ,as constituted for the benefit solel1 of the
principal or for respondent @e Ada. de :e. No,here can ,e
infer fro# the stipulations therein that it ,as created for the
co##on interest of respondent and her attorne1+in+
fact. Neither ,as there an1 #ention that it ,as to benefit a
third person ,ho has accepted the stipulation in his favor.

On this $round, Ee a$ree ,ith petitioner. >o,ever,
Ee do not believe that such $round ,ould cause the
dis#issal of the co#plaint. @or as Ee have said, Civil
Case No. 0-'', ,hich is an action for the recover1 of a
personal propert1, a #otor vehicle, is an action that
survives pursuant to !ection &, Rule '2 of the Rules of
Court. As such, it is not e*tin$uished b1 the death of a
part1.
In *onzalez v. +hilippine Amusement and *amin(
Corporation,
3.04
Ee have laid do,n the criteria for
deter#inin$ ,hether an action survives the death of a
plaintiff or petitioner, to ,it:

* * * :he Duestion as to ,hether an
action survives or not depends on the
nature of the action and the da#a$e
sued for. If the causes of action ,hich
survive the ,ron$ co#plained 3of4
affects pri#aril1 and principall1
propert1 and propert1 ri$hts, the
in=uries to the person bein$ #erel1
incidental, ,hile in the causes of action
,hich do not survive the in=ur1
co#plained of is to the person the
propert1 and ri$hts of propert1 affected
bein$ incidental. * * *

:hus, the R:C aptl1 resolved the second issue ,ith
the follo,in$ ratiocination:

Ehile it #a1 be true as
alle$ed b1 defendants that ,ith the
death of Plaintiff, @e Ada. de :e, the
!pecial Po,er of Attorne1 she
e*ecuted e#po,erin$ the Attorne1+in+
fact, @austino CastaQeda to sue in her
behalf has been rendered fun)tus
offi)io, ho,ever, this Court believes
that the Attorne1+in+fact had not lost
his personalit1 to prosecute this case.

I# <ear #re!n/ #)a# %)en
#)! .ae %a !n!#!a#edKf!+ed <* #)e
A##orne*-!n-fa.#, #)e "+a!n#!ff %a
#!++ $er* ,u.) a+!$e.
Re.ord re$ea+ #)a# #)e
A##orne*-!n-fa.# )a #e#!f!ed +on/
<efore !n <e)a+f of #)e a!d "+a!n#!ff
and ,ore "ar#!.u+ar+* dur!n/ #)e
#a#e %)en #)e "+a!n#!ff %a
$e)e,en#+* o""o!n/ #)e d!,!a+
of #)e .o,"+a!nan#. Su<eHuen#+*
#)ere#o, )e e$en offered
do.u,en#ar* e$!den.e !n u""or# of
#)e .o,"+a!n#, and #)! .our#
ad,!##ed #)e a,e. ?)en #)!
.ae %a !n!#!a#ed, -ur!d!.#!on %a
$e#ed u"on #)! Cour# #o #r* and
)ear #)e a,e #o #)e end. ?e++-
e##+ed ! #)e ru+e #o #)e "o!n# of
<e!n/ e+e,en#ar* #)a# on.e
-ur!d!.#!on ! a.Hu!red <* #)!
Cour#, !# a##a.)e un#!+ #)e .ae !
de.!ded.
T)u, #)e "ro"er re,ed*
)ere ! #)e Su<#!#u#!on of He!r and
no# #)e d!,!a+ of #)! .ae %)!.)
%ou+d %orB !n-u#!.e #o #)e "+a!n#!ff.

SEC* +,, R-LE . "ro$!de
for #)e u<#!#u#!on of #)e "+a!n#!ff
%)o d!e "end!n/ )ear!n/ of #)e
.ae <* )!K)er +e/a+ )e!r. A #o
%)e#)er or no# #)e )e!r %!++ #!++
.on#!nue #o en/a/e #)e er$!.e of
#)e A##orne*-!n-fa.# ! ano#)er
,a##er, %)!.) +!e %!#)!n #)e o+e
d!.re#!on of #)e )e!r.

In f!ne, ?e )o+d #)a# #)e "e#!#!on )ou+d <e
den!ed a #)e RTC Order ! !n#er+o.u#or*E )en.e, no# a
"ro"er u<-e.# of an a""ea+ <efore #)e Cour#. In #)e
a,e <rea#), ?e a+o )o+d #)a#, !f #)e "e#!#!on ! #o <e
#rea#ed a a "e#!#!on for certiorari a a re+a@a#!on of #)e
-ud!.!a+ )!erar.)* of .our#, #)e a,e ! a+o
d!,!!<+e for <e!n/ u<#an#!a++* !nuff!.!en# #o
%arran# #)e Cour# #)e nu++!f!.a#!on of #)e Order of #)e
RTC.

Le# #)! <e an o..a!on for U #o re!#era#e #)a#
#)e ru+e are #)ere #o a!d +!#!/an# !n "roe.u#!n/ or
defend!n/ #)e!r .ae <efore #)e .our#. Ho%e$er,
#)ee $er* ru+e )ou+d no# <e a<ued o a #o
ad$an.e oneI "erona+ "ur"oe, #o #)e de#r!,en# of
order+* ad,!n!#ra#!on of -u#!.e. ?e .an ur,!e
fro, #)e "reen# .ae )ere!n "e#!#!onerI ,an!"u+a#!on
!n order #o .!r.u,$en# #)e ru+e on ,ode of a""ea+
and #)e )!erar.)* of .our# o #)a# #)e !ue
"reen#ed )ere!n .ou+d <e e##+ed %!#)ou# /o!n/
#)rou/) #)e e#a<+!)ed "ro.edure. In ergara, Sr.
v. Suelto,
&=9(
?e #reed #)a# #)! )ou+d <e #)e
.on#an# "o+!.* #)a# ,u# <e o<er$ed #r!.#+* <* #)e
.our# and +a%*er, #)uD @ @ @. T'e Su)reme Court
s a $ourt o" last resort, a!d must so rema! " t s
to sats"a$torl& )er"orm t'e "u!$to!s assg!ed to
t %& t'e "u!dame!tal $'arter a!d mmemoral
tradto!* I# .anno# and )ou+d no# <e <urdened %!#)
#)e #aB of dea+!n/ %!#) .aue !n #)e f!r#
!n#an.e. Its org!al (ursd$to! to ssue t'e so-
$alled extraord!ar& #rts s'ould %e exer$sed
o!l& #'ere a%solutel& !e$essar& or #'ere serous
a!d m)orta!t reaso!s exst t'ere"or* Hen.e, #)a#
-ur!d!.#!on )ou+d /enera++* <e e@er.!ed re+a#!$e #o
a.#!on or "ro.eed!n/ <efore #)e Cour# of A""ea+,
or <efore .on#!#u#!ona+ or o#)er #r!<una+, <od!e or
a/en.!e %)oe a.# for o,e reaon or ano#)er are
no# .on#ro++a<+e <* #)e Cour# of A""ea+. /'ere t'e
ssua!$e o" a! extraord!ar& #rt s also #t'!
t'e $om)ete!$e o" t'e Court o" A))eals or a
Rego!al Tral Court, t s ! et'er o" t'ese $ourts
t'at t'e s)e$"$ a$to! "or t'e #rt0s )ro$ureme!t
must %e )rese!ted* T's s a!d s'ould $o!t!ue
to %e t'e )ol$& ! t's regard, a )ol$& t'at $ourts
a!d la#&ers must str$tl& o%ser1e*
&==(

/HERE2ORE, "re,!e .on!dered, #)e
Pe#!#!on ! DENIED. T)e Order da#ed 1ar.) 00,
0223 of #)e Re/!ona+ Tr!a+ Cour#, Bran.) '6, 7!/o,
7a$ao de+ Sur !n C!$!+ Cae No. 89::, !
)ere<* A22IR3ED. Co# a/a!n# #)e "e#!#!oner.

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