WACK WACK GOLF & COUNTRY CLUB, INC.

,
plaintiff-appellant,
vs.
LEE E. WON alias RAMON LEE and BIENVENIDO A.
TAN, defendants-appellees.
G.R. No. L-23851 March 26, 1976
CASTRO, C.J.:
FACTS: This is an appeal from the order of the Court of
First Instance of Rizal, in civil case 7656, dismissing the
plaintiff-appellant's complaint of interpleader upon the
grounds of failure to state a cause of action and res
judicata.
Wack Wack Golf & Country Club, Inc., a nonstock, civic and athletic corporation, with principal office
in Mandaluyong, Rizal, alleged, for its first cause of
action, that the defendant Lee E. Won claims ownership
of its membership fee certificate 201, by virtue of the
decision rendered in a civil case of the CFI of Manila and
also by virtue of membership fee certificate issued by
the deputy clerk of court of the CFI of Manila, for and in
behalf of the president and the secretary of the
Corporation and of the People's Bank & Trust Company
as transfer agent of the said Corporation; that the
defendant Bienvenido A. Tan, on the other hand, claims
to be lawful owner of its aforesaid membership fee
certificate by virtue of membership fee certificate issued
to him pursuant to an assignment made in his favor by
"Swan, Culbertson and Fritz," the original owner and
holder of the membership fee certificate; that under its
articles of incorporation and by-laws the Corporation is
authorized to issue a maximum of 400 membership fee
certificates to persons duly elected or admitted to
proprietary membership, all of which have been issued
as early as December 1939; that it claims no interest
whatsoever in the said membership fee certificate; that it
has no means of determining who of the two defendants
is the lawful owner thereof; that it is without power to
issue two separate certificates for the same membership
fee certificate, or to issue another membership fee
certificate to the defendant Lee, without violating its
articles of incorporation and by-laws; and that the
membership fee certificate held by the defendant Tan
and the membership fee certificate issued to the
defendant Lee proceed from the same membership fee
certificate 201, originally issued in the name of "Swan,
Culbertson and Fritz".
For its second cause of action, it alleged that the
membership fee certificate issued by the deputy clerk of
court of court of the CFI of Manila in behalf of the
Corporation is null and void because issued in violation
of its by-laws, which require the surrender and
cancellation of the outstanding membership fee
certificate before issuance may be made to the
transferee of a new certificate duly signed by its
president and secretary, aside from the fact that the
decision of the CFI of Manila in the civil case is not
binding upon the defendant Tan, holder of membership
fee certificate; that Tan is made a party because of his
refusal to join it in this action or bring a separate action
to protect his rights despite the fact that he has a legal
and beneficial interest in the subject matter of this
litigation; and that he is made a part so that complete
relief may be accorded herein.
The Corporation prayed that (a) an order be issued
requiring Lee and Tan to interplead and litigate their
conflicting claims; and (b) judgment. be rendered, after
hearing, declaring who of the two is the lawful owner of
membership fee certificate 201, and ordering the

surrender and cancellation of membership fee certificate

201-serial no. 1478 issued in the name of Lee.
In separate motions the defendants moved to dismiss
the complaint upon the grounds of res judicata, failure of
the complaint to state a cause of action, and bar by
prescription. These motions were duly opposed by the
Corporation. Finding the grounds of bar by prior
judgment and failure to state a cause of action well
taken, the trial court dismissed the complaint, with costs
against the Corporation.
ISSUES:
(1) Whether or not the court a quo erred in
dismissing the action instead of compelling the
appellees to interplead and litigate between
themselves their respective claims.
(2) Has the Corporation in this case acted with
diligence, in view of all the circumstances, such
that it may properly invoke the remedy of
interpleader?
HELD:
(1) No. The action of interpleader is a remedy whereby a
person who has personal property in his possession, or
an obligation to render wholly or partially, without
claiming any right to either, comes to court and asks that
the persons who claim the said personal property or who
consider themselves entitled to demand compliance with
the obligation, be required to litigate among themselves
in order to determine finally who is entitled to tone or the
one thing. The remedy is afforded to protect a person
not against double liability but against double vexation in
respect of one liability. The procedure under the Rules of
Court is the same as that under the Code of Civil
Procedure, except that under the former the remedy of
interpleader is available regardless of the nature of the
subject-matter of the controversy, whereas under the
latter an interpleader suit is proper only if the subjectmatter of the controversy is personal property or relates
to the performance of an obligation.
The instant interpleader suit cannot prosper
because the Corporation had already been made
independently liable in civil case 26044 and, therefore,
its present application for interpleader would in effect be
a collateral attack upon the final judgment in the said
civil case; the appellee Lee had already established his
rights to membership fee certificate 201 in the aforesaid
civil case and, therefore, this interpleader suit would
compel him to establish his rights anew, and thereby
increase instead of diminish litigations, which is one of
the purposes of an interpleader suit, with the possiblity
that the benefits of the final judgment in the said civil
case might eventually be taken away from him; and
because the Corporation allowed itself to be sued to final
judgment in the said case, its action of interpleader was
filed inexcusably late, for which reason it is barred by
laches or unreasonable delay.
(2) No. A stakeholder should use reasonable diligence
to hale the contending claimants to court. He need not
await actual institution of independent suits against him
before filing a bill of interpleader. He should file an action
of interpleader within a reasonable time after a dispute
has arisen without waiting to be sued by either of the
contending claimants. Otherwise, he may be barred by
laches or undue delay. But where he acts with
reasonable diligence in view of the environmental
circumstances, the remedy is not barred.

The Corporation was aware of the conflicting

claims of the appellees with respect to the membership
fee certificate 201 long before it filed the present
interpleader suit. It had been recognizing Tan as the
lawful owner thereof. It was sued by Lee who also
claimed the same membership fee certificate. Yet it did
not interplead Tan. It preferred to proceed with the
litigation (civil case 26044) and to defend itself therein.
As a matter of fact, final judgment was rendered against
it and said judgment has already been executed. It is not
therefore too late for it to invoke the remedy of
interpleader.
It has been held that a stakeholder's action of
interpleader is too late when filed after judgment has
been rendered against him in favor of one of the
contending claimants, especially where he had notice of
the conflicting claims prior to the rendition of the
judgment and neglected the opportunity to implead the
adverse claimants in the suit where judgment was
entered. This must be so, because once judgment is
obtained against him by one claimant he becomes liable
to the latter.
The Corporation has not shown any justifiable
reason why it did not file an application for interpleader
in civil case 26044 to compel the appellees herein to
litigate between themselves their conflicting claims of
ownership. It was only after adverse final judgment was
rendered against it that the remedy of interpleader was
invoked by it. By then it was too late, because to be
entitled to this remedy the applicant must be able to
show that lie has not been made independently liable to
any of the claimants. And since the Corporation is
already liable to Lee under a final judgment, the present
interpleader suit is clearly improper and unavailing.
If a stakeholder defends a suit filed by one of the
adverse claimants and allows said suit to proceed to
final judgment against him, he cannot later on have that
part of the litigation repeated in an interpleader suit. In
the case at hand, the Corporation allowed civil case
26044 to proceed to final judgment. And it offered no
satisfactory explanation for its failure to implead Tan in
the same litigation. In this factual situation, it is clear that
this interpleader suit cannot prosper because it was filed
much too late.
ACCORDINGLY, the order of May 28, 1964, dismissing
the complaint, is affirmed.
_____________________________________________
RCBC v. Metro Container Corp.
GR No. 127913 Sept. 13, 2001
Kapunan, J.:
FACTS: Sept. 1990, Ley Construction Corporation
(LEYCON) contracted a loan from RCBC in the amount
of P30 million which was secured by a real estate
mortgage over a Valenzuela property. LEYCON failed to
settle its obligations prompting RCBC to institute
extrajudicial foreclosure proceedings against it and in
Dec. 1992, RCBC was the highest bidder.
LEYCON as a response, filed an action for Nullificatoin
of Extrajudicial Foreclosure Sale and Damages against
RCBC but eventually RCBC was able to consolidate its
ownership over the property due to LEYCONs failure to
redeem. Metro Container Corporation (METROCAN)
which was leasing the property from LEYCON was
demanded by RCBC to make rental payments. LEYCON
filed an action for Unlawful Detainer against
METROCAN.

METROCAN, meanwhile, filed a complaint for

Interpleader against LEYCON and RCBC to compel
them to interplead and litigate their several claims
among themselves and to determine which among them
shall rightfully receive the payment of monthly rentals. In
the Interpleader case, an amicable settlement was made
between METROCAN and LEYCON with respect to
back rentals. However, in the Unlawful Detainer case,
METROCAN was order to pay LEYCON whatever
rentals were due. METRPCAN claims interpleader case
is moot and academic because of amicable settlement.
RCBC alleges, however, that the decision of the lower
court in the ejectment case cannot render the
Interpleader action moot and academic.
ISSUE: W/N the Party who initiates the interpleader
action may be compelled to litigate if he is no longer
interested to pursue such cause of action?
RULING: It is undisputed that METROCAN filed the
interpleader action because LEYCON was claiming
payment of the rentals as lessor and RCBC was making
a demand by virtue of the consolidation of the title of the
property in its name. The Supreme Court said that the
unlawful detainer case involves issue of material
possession and not of ownership, therefore, the reason
for the interpleader ceased when the lower court
rendered judgment ordering METROCAN to pay
LEYCON. It should be remembered that an action for
interpleader is afforded to protect a person not against
double liability but against double vexation in respect of
one liability
_____________________________________________
Lim vs. Continental Development Corporation
(G.R. No. L-41818 February 18, 1976)
Continental Development Corp. vs. Tan and Lim
(G.R. No. L-41831 February 18, 1976)
Makasiar, J.:
FACTS: This is a consolidation of two petitions to review
the March 12, 1974 order of the Judge of Branch XXVI
of the Manila Court of First Instance, dismissing herein
petitioner Continental Development Corporation's (CDC)
complaint for interpleader. The Court resolved to treat
these petitions as special civil actions.
Records show that on November 26, 1973, CDC filed a
complaint for interpleader against defendants Benito
Gervasio Tan and Zoila Co Lim, alleging among others,
that Gervasio Tan is one of CDC's stockholders with an
outstanding total stockholding of 125 common shares of
the par value of P250.00 each. Tan has been demanding
the release to him the certificates of stock aforesaid, but
CDC has not done and is prevented from doing so
because of the adverse claim thereto by Lim. The latter
has laid claim in the very same shares of stock, alleging
that such really belonged to her deceased mother, So Bi,
alias Tawa. Both Tan and Lim threaten to take punitive
measures against the CDC should it take any steps
prejudicial to their respective interests. CDC alleged that
is not sufficiently informed of the claimants' respective
rights and therefore not in a position to determine justly
and correctly their conflicting claims. CDC is
nevertheless ready and willing to deliver the
corresponding certificates of ownership to whomsoever
as the Court may direct. Thus, CDC prays that
defendants Tan and Lim be directed to interplead and
litigate their respective claims over the subject shares of
stock and to determine their respective rights thereto.

and derived from the same source.

Tan on one hand moved to dismiss the complaint, on the
ground that paragraph 2 thereof states that the subject
shares of stock are recorded in CDC's books in Tan's
name. He should therefore be declared owner thereof
pursuant to Section 52 of the Corporation Law. Lim on
the other hand in her answer expressly admitted
paragraph 2 of the complaint, but alleged that said
shares of stock had previously been delivered in trust to
Tan for Lim's mother. As daughter and heir of the latter,
Lim alleged that she is now the owner of said shares of
stock. CDC in turn opposed Tan's motion to dismiss.
The trial judge dismissed the complaint for interpleader
for lack of cause of action, invoking Section 35 of the
Corporation Law. Both Lim and CDC filed their
respective motions for reconsideration, to which Tan filed
his rejoinder. Said motions were denied. Hence, the
present petitions by CDC and Lim.
ISSUE: Whether or not the complaint for interpleader
was properly dismissed.
RULING: NO. The Court noted that since there is an
active conflict of interests between Tan and Lim over the
disputed shares of stock, the trial court gravely abused
its discretion in dismissing the complaint for interpleader,
which practically decided ownership of the shares of
stock in favor of defendant Tan. The two defendants Lim
and Tan who are now respondents in G.R. No. L-41831,
should be given full opportunity to litigate their respective
claims.
Rule 63, Section 1 of the New Rules of Court provides
that a cause of action exists to support a complaint in
interpleader:
Whenever conflicting claims upon the same subject
matter are or may be made against a person, who
claims no interest whatever in the subject matter, or an
interest which in whole or in part is not disputed by the
complainants to compel them to interplead and litigate
their several claims among themselves.
This provision only requires as an indispensable
requisite: that conflicting claims upon the same subject
matter are or may be made against the plaintiff-ininterpleader who claims no interest whatever in the
subject matter or an interest which in whole or in part is
not disputed by the claimants (Beltran vs. People's
Homesite and Housing Corporation).
This ruling, penned by Mr. Justice Tee the principle in
Alvarez vs. Commonwealth, that: the action of
interpleader under section 120, is a remedy whereby a
person who has personal property in his possession, or
an obligation to render wholly or partially, without
claiming any right in both comes to court and asks that
the persons who claim the said personal property or who
consider themselves entitled to demand compliance with
the obligation, be required to litigate among themselves,
in order to determine finally who is entitled to one or the
other thing. The remedy is afforded not to protect a
person against a double liability but to protect him
against a double vexation in respect of one liability'
An interpleader merely demands as a sine qua non
element: that there be two or more claimants to the fund
or thing in dispute through separate and different
interests. The claims must be adverse before relief can
be granted and the parties sought to be interpleaded
must be in a position to make effective claims.
Additionally, the fund, thing, or duty over which the
parties assert adverse claims must be one and the same

In this case, CDC is placed in the same situation as a

lessee who does not know the person to whom he will
pay the rentals due to the conflicting claims over the
property leased, or a sheriff who finds himself puzzled by
conflicting claims to a property seized by him. In these
examples, the lessee and the sheriff were each allowed
to file a complaint in interpleader to determine the
respective rights of the claimants.
The petition is granted, and the order assailed is set
aside.
_____________________________________________

EUFEMIA ALMEDA and ROMEL ALMEDA vs

BATHALA MARKETING INDUSTRIES, INC.
G.R. No. 150806, January 28, 2008
FACTS: Sometime in May 1997, respondent Bathala
Marketing Industries, Inc., as lessee, represented by its
president Ramon H. Garcia, renewed its Contract of
Lease with Ponciano L. Almeda (Ponciano), as lessor,
husband of petitioner Eufemia and father of petitioner
Romel Almeda. Under the said contract, Ponciano
agreed to lease a portion of the Almeda Compound for a
monthly rental of P1,107,348.69, for a term of four (4)
years from May 1, 1997 unless sooner terminated as
provided in the contract. During the effectivity of the
contract, Ponciano died. Thereafter, respondent dealt
with petitioners. In a letter petitioner advised respondent
that the former shall assess and collect Value Added Tax
(VAT) on its monthly rentals. In response, respondent
contended that VAT may not be imposed as the rentals
fixed in the contract of lease were supposed to include
the VAT therein, considering that their contract was
executed on May 1, 1997 when the VAT law had long
been in effect. Also, respondent received another letter
from petitioners informing the former that its monthly
rental should be increased by 73% pursuant to condition
No. 7 of the contract and Article 1250 of the Civil Code.
Respondent opposed petitioners' demand and insisted
that there was no extraordinary inflation to warrant the
application of Article 1250 in light of the pronouncement
of this Court in various cases. Respondent refused to
pay the VAT and adjusted rentals as demanded by
petitioners but continued to pay the stipulated amount
set forth in their contract.
Thereafter, respondent instituted an action for
declaratory relief for purposes of determining the correct
interpretation of condition Nos. 6 and 7 of the lease
contract to prevent damage and prejudice. Petitioners in
turn filed an action for ejectment, rescission and
damages against respondent for failure of the latter to
vacate the premises after the demand made by the
former. Before respondent could file an answer,
petitioners filed a Notice of Dismissal. They
subsequently refiled the complaint before the
Metropolitan Trial Court of Makati. Petitioners later
moved for the dismissal of the declaratory relief case for
being an improper remedy considering that respondent
was already in breach of the obligation and that the case
would not end the litigation and settle the rights of the
parties. The trial court, however, was not persuaded, and
consequently, denied the motion. The RTC ruled in favor
of respondent. CA affirmed the decision of the RTC.
ISSUE: 1) whether the action for declaratory relief is
proper; 2) whether respondent is liable to pay 10% VAT
pursuant to Republic Act (RA) 7716; and 3) whether the

amount of rentals due the petitioners should be adjusted

by reason of extraordinary inflation or devaluation.
HELD: (1) Yes. Declaratory relief is defined as an action
by any person interested in a deed, will, contract or other
written instrument, executive order or resolution, to
determine any question of construction or validity arising
from the instrument, executive order or regulation, or
statute, and for a declaration of his rights and duties
thereunder. The only issue that may be raised in such a
petition is the question of construction or validity of
provisions in an instrument or statute. Corollary is the
general rule that such an action must be justified, as no
other adequate relief or remedy is available under the
circumstances.
Decisional law enumerates the requisites of an action for
declaratory relief, as follows: 1) the subject matter of the
controversy must be a deed, will, contract or other
written instrument, statute, executive order or regulation,
or ordinance; 2) the terms of said documents and the
validity thereof are doubtful and require judicial
construction; 3) there must have been no breach of the
documents in question; 4) there must be an actual
justiciable controversy or the "ripening seeds" of one
between persons whose interests are adverse; 5) the
issue must be ripe for judicial determination; and 6)
adequate relief is not available through other means or
other forms of action or proceeding.
It is beyond cavil that the foregoing requisites are
present in the instant case, except that petitioners insist
that respondent was already in breach of the contract
when the petition was filed. We do not agree.
After petitioners demanded payment of adjusted rentals
and in the months that followed, respondent complied
with the terms and conditions set forth in their contract of
lease by paying the rentals stipulated therein.
Respondent religiously fulfilled its obligations to
petitioners even during the pendency of the present suit.
There is no showing that respondent committed an act
constituting a breach of the subject contract of lease.
Thus, respondent is not barred from instituting before
the trial court the petition for declaratory relief.
Petitioners claim that the instant petition is not proper
because a separate action for rescission, ejectment and
damages had been commenced before another court;
thus, the construction of the subject contractual
provisions should be ventilated in the same forum. We
are not convinced. Given all these attendant
circumstances, the Court is disposed to entertain the
instant declaratory relief action instead of dismissing it,
notwithstanding the pendency of the
ejectment/rescission case before the trial court. The
resolution of the present petition would write finis to the
parties' dispute, as it would settle once and for all the
question of the proper interpretation of the two
contractual stipulations subject of this controversy.
(2) and (3): ( I think this is not part of SPECPRO):
Clearly, the person primarily liable for the payment of
VAT is the lessor who may choose to pass it on to the
lessee or absorb the same however, petitioners are
estopped from shifting to respondent the burden of
paying the VAT.
Petitioners' reliance on the sixth condition of the contract
is, likewise, unavailing. This provision clearly states that
respondent can only be held liable for new
taxes imposed after the effectivity of the contract of
lease, that is, after May 1997, and only if they pertain to

the lot and the building where the leased premises are
located. Considering that RA 7716 took effect in 1994,
the VAT cannot be considered as a "new tax" in May
1997, as to fall within the coverage of the sixth
stipulation. Neither can petitioners legitimately demand
rental adjustment because of extraordinary inflation or
devaluation..
The factual circumstances obtaining in the present case
do not make out a case of extraordinary inflation or
devaluation as would justify the application of Article
1250 of the Civil Code. We would like to stress that the
erosion of the value of the Philippine peso in the past
three or four decades, starting in the mid-sixties, is
characteristic of most currencies. And while the Court
may take judicial notice of the decline in the purchasing
power of the Philippine currency in that span of time,
such downward trend of the peso cannot be considered
as the extraordinary phenomenon contemplated by
Article 1250 of the Civil Code. Furthermore, absent an
official pronouncement or declaration by competent
authorities of the existence of extraordinary inflation
during a given period, the effects of extraordinary
inflation are not to be applied.
_____________________________________________
Brother MARIANO "MIKE" Z. VELARDE vs. SOCIAL
JUSTICE SOCIETY
G.R. No. 159357
April 28, 2004
PANGANIBAN, J.:
FACTS:
SJS filed a Petition for Declaratory Relief ("SJS Petition")
before the RTC-Manila against Velarde and his corespondents: His Eminence, Jaime Cardinal Sin,
Executive Minister Erao Manalo, Brother Eddie
Villanueva and Brother Eliseo F. Soriano.
SJS, a registered political party, sought the interpretation
of several constitutional provisions, specifically on the
separation of church and state; and a declaratory
judgment on the constitutionality of the acts of religious
leaders endorsing a candidate for an elective office, or
urging or requiring the members of their flock to vote for
a specified candidate.
All sought the dismissal of the Petition on the common
grounds that it does not state a cause of action and that
there is no justiciable controversy.
The trial court said that it had jurisdiction over the
Petition, because "in praying for a determination as to
whether the actions imputed to the respondents are
violative of Article II, Section 6 of the Fundamental Law,
[the Petition] has raised only a question of law." It then
proceeded to a lengthy discussion of the issue raised in
the Petition the separation of church and state even
tracing, to some extent, the historical background of the
principle. Through its discourse, the court a quo opined
at some point that the "[e]ndorsement of specific
candidates in an election to any public office is a clear
violation of the separation clause.
After its essay on the legal issue, however, the trial
court failed to include a dispositive portion in its
assailed Decision. Thus, Velarde and Soriano filed
separate Motions for Reconsideration which, as
mentioned earlier, were denied by the lower court.
Hence, this Petition for Review.
ISSUES:

PROCEDURAL ISSUES
1) Did the Petition for Declaratory Relief raise a
justiciable controversy?
2) Did the Petition for DR state a cause of action?
3) Did respondent have any legal standing to file the
Petition for DR?
SUBSTANTIVE ISSUES:
4) Did the RTC Decision conform to the form and
substance required by the Constitution, the law and the
Rules of Court?
5) Whether or not the act of a religious leader like any of
herein respondents, in endorsing the candidacy of a
candidate for elective office or in urging or requiring the
members of his flock to vote for a specified candidate, is
violative of the letter or spirit of the constitutional
provisions?
HELD:
DECLARATORY RELIEF (Brief discussion)
WHO SHOULD FILE?
A person interested under a deed, a will,
a contract or other written instrument, and
whose rights are affected by a statute, an
executive order, a regulation or an
ordinance.
PURPOSE?
To interpret or to determine the validity
of the written instrument and to seek a judicial
declaration of the parties rights or duties
thereunder.
ESSENTIAL REQUISITES:
1) there is a justiciable controversy;
2) the controversy is between persons
whose interests are adverse;
3) the party seeking the relief has a
legal interest in the controversy; and
4) the issue is ripe for judicial
determination.
PROCEDURAL ISSUES:
1) NO. A justiciable controversy refers to an existing
case or controversy that is appropriate or ripe for judicial
determination, not one that is conjectural or merely
anticipatory. The SJS Petition for Declaratory Relief fell
short of this test. It miserably failed to allege an existing
controversy or dispute between the petitioner and the
named respondents therein. Further, the Petition did not
sufficiently state what specific legal right of the petitioner
was violated by the respondents therein; and what
particular act or acts of the latter were in breach of its
rights, the law or the Constitution.
2) NO. A cause of action is an act or an omission of one
party in violation of the legal right or rights of another,
causing injury to the latter. The failure of a complaint to
state a cause of action is a ground for its outright
dismissal. However, in special civil actions for
declaratory relief, the concept of a cause of action under
ordinary civil actions does not strictly apply. The reason
for this exception is that an action for declaratory relief
presupposes that there has been no actual breach of the
instruments involved or of rights arising thereunder.
Nevertheless, a breach or violation should be
impending, imminent or at least threatened.
A perusal of the Petition filed by SJS before the RTC
discloses no explicit allegation that the former had any
legal right in its favor that it sought to protect.
3) NO. Legal standing or locus standi has been
defined as a personal and substantial interest in the
case, such that the party has sustained or will sustain

direct injury as a result of the challenged act. Interest

means a material interest in issue that is affected by the
questioned act or instrument, as distinguished from a
mere incidental interest in the question involved.
First, in the present case, there is no allegation, whether
express or implied, that taxpayers money is being
illegally disbursed.
Second, there was no showing in the Petition for
Declaratory Relief that SJS as a political party or its
members as registered voters would be adversely
affected by the alleged acts of the respondents below, if
the question at issue was not resolved.
Third, the allegedly keen interest of its "thousands of
members who are citizens-taxpayers-registered voters"
is too general and beyond the contemplation of the
standards set by our jurisprudence. Not only is the
presumed interest impersonal in character; it is likewise
too vague, highly speculative and uncertain to satisfy the
requirement of standing.
SUBSTANTIVE ISSUES:
4) NO.
Firstly, the initiatory pleading contained no statement
of ultimate facts upon which the petitioner relied for its
claim. Furthermore, it did not specify the relief it sought
from the court, but merely asked it to answer a
hypothetical question. The Petition evidently lacked
substantive requirements and, we repeat, should have
been dismissed at the outset.
Secondly, contrary to the requirement of Section 2 of
Rule 16 of the Rules of Court, the Motions were not
heard. Worse, the Order purportedly resolving the
Motions to Dismiss did not state any reason at all for
their denial, in contravention of Section 3 of the said
Rule 16. There was not even any statement of the
grounds relied upon by the Motions; much less, of the
legal findings and conclusions of the trial court.
All in all, during the loosely abbreviated proceedings of
the case, the trial court indeed acted with inexplicable
haste, with total ignorance of the law -- or, worse, in
cavalier disregard of the rules of procedure -- and with
grave abuse of discretion.
Thirdly, in the present case, it is starkly obvious that the
assailed Decision contains no statement of facts -much less an assessment or analysis thereof -- or of the
courts findings as to the probable facts. The Decision
proceeds to a full-length opinion on the nature and the
extent of the separation of church and state. Without
expressly stating the final conclusion she has reached or
specifying the relief granted or denied, the trial judge
ends her "Decision" with the clause "SO ORDERED."
5) This issue deserves serious consideration. As stated
earlier, the Court deems this constitutional issue to be of
paramount interest to the Filipino citizenry, for it
concerns the governance of our country and its people.
Thus,
despite
the
obvious
procedural
transgressions by both SJS and the trial court, this
Court still called for Oral Argument, so as not to
leave any doubt that there might be room to
entertain and dispose of the SJS Petition on the
merits.
Counsel for SJS has utterly failed, however, to
convince the Court that there are enough factual and
legal bases to resolve the paramount issue.
_____________________________________________

PHILIPPINE DEPOSIT INSURANCE CORPORATION

vs. THE HONORABLE COURT OF APPEALS
G.R. No. 126911. April 30, 2003
CARPIO-MORALES, J.:
FACTS: Prior to May 22, 1997, private respondents had,
individually or jointly with each other, 71 certificates of
time deposits denominated as Golden Time Deposits
(GTD) with an aggregate face value of P1,115,889.96.
On May 22, 1987, the Monetary Board (MB) of the
Central Bank of the Philippines, now Bangko Sentral ng
Pilipinas, issued Resolution 505 prohibiting MBC to do
business in the Philippines, and placing its assets and
affairs under receivership. The Resolution, however, was
not served on MBC until Tuesday the following week, or
on May 26, 1987, when the designated Receiver took
over. On May 25, 1987, the next banking day following
the issuance of the MB Resolution, respondent Jose
Abad was at the MBC at 9:00 a.m. for the purpose of
pre-terminating the 71 aforementioned GTDs and redepositing the fund represented thereby into 28 new
GTDs in denominations of P40,000.00 or less under the
names of herein respondents individually or jointly with
each other. Of the 28 new GTDs, Jose Abad preterminated 8 and withdrew the value thereof in the total
amount of P320,000.00. Respondents thereafter filed
their claims with the PDIC for the payment of the
remaining 20 insured GTDs. PDIC paid respondents the
value of 3 claims in the total amount of P120,000.00.
PDIC, however, withheld payment of the 17 remaining
claims after Washington Solidum, Deputy Receiver of
MBC-Iloilo, submitted a report to the PDIC[7] that there
was massive conversion and substitution of trust and
deposit accounts on May 25, 1987 at MBC-Iloilo.
Because of the report, PDIC entertained serious
reservation in recognizing respondents GTDs as deposit
liabilities of MBC-Iloilo. It filed a petition for declaratory
relief against respondents with the Regional Trial Court
(RTC) of Iloilo City, for a judicial declaration
determination of the insurability of respondents GTDs at
MBC-Iloilo. In their Answer and Amended Answer
respondents set up a counterclaim against PDIC
whereby they asked for payment of their insured
deposits. Both the RTC, and on appeal to the CA, ruled
in favor of herein private respondents. Hence this
petition.
ISSUE: Court of Appeals erred in affirming the holding of
the trial court ordering petitioner to pay respondents
claims for payment of insured deposits for the reason
that an action for declaratory relief does not essentially
entail an executory process as the only relief that should
have been granted by the trial court is a declaration of
the rights and duties of petitioner.
HELD: Petition is devoid of merit. Without doubt, a
petition for declaratory relief does not essentially entail
an executory process. There is nothing in its nature,
however, that prohibits a counterclaim from being
set-up in the same action.
Now, there is nothing in thee nature of a special civil
action for declaratory relief that proscribes the filing of a
counterclaim based on the same transaction, deed or
contract subject of the complaint. A special civil action is
after all not essentially different from an ordinary civil
action, which is generally governed by Rules 1 to 56 of
the Rules of Court, except that the former deals with a
special subject matter which makes necessary some
special regulation. But the identity between their
fundamental nature is such that the same rules
governing ordinary civil suits may and do apply to
special civil actions if not inconsistent with or if they
may serve to supplement the provisions of the

peculiar rules governing special civil actions.

Wherefore the decision of the CA is affirmed.
_____________________________________________
DBM V. Manilas Finest Retirees Association
May 9, 2007
Presidential Decree (P.D.) No. 765 was
issued constituting the Integrated National Police (INP)
to be composed of the Philippine Constabulary (PC) as
the nucleus and the integrated police forces as
components thereof.
Republic Act (R.A.) No. 6975, referred to as
PNP Law, was enacted. Under Section 23 of said law,
the Philippine National Police (PNP) would initially
consist of the members of the INP as well as the officers
and enlisted personnel of the PC.
A little less than eight (8) years later, R.A.
No. 6975 was amended. The amendatory law
reengineered the retirement scheme in the police
organization. Relevantly, PNP personnel, under the new
law, stood to collect more retirement benefits than what
INP members of equivalent rank, who had retired under
the INP Law, received.
Hence, on June 3, 2002, in the RTC of
Manila, all INP retirees, spearheaded by the Manilas
Finest Retirees Association, Inc., or the MFRAI , filed a
petition for declaratory relief, impleading, as
respondents, the Department of Budget and
Management (DBM), the PNP, the National Police
Commission
(NAPOLCOM),
the
Civil
Service
Commission (CSC) and the Government Service
Insurance System (GSIS). Accordingly, in their petition,
the petitioning INP retirees pray that a
DECLARATORY
JUDGMENT be rendered in their
favor, DECLARING with certainty
that they, as INP-retirees, are truly
absorbed and equally considered
as PNP-retirees and thus, entitled
to enjoy the SAME or IDENTICAL
retirement benefits being bestowed
to PNP-retirees by virtue of said
PNP Law or Republic Act No.
6975, as amended by Republic Act
8551, with the corollary mandate
for the respondents-government
agencies to effect the immediate
adjustment on their previously
received
disparate
retirement
benefits,
retroactive
to
its
effectivity, and with due payment
thereof.
The RTC came out with its decision holding
that R.A. No. 6975, as amended, did not abolish the INP
but merely provided for the absorption of its police
functions by the PNP, and accordingly rendered
judgment for the INP retirees, to wit:
WHEREFORE,
this
Court hereby renders JUDGMENT
DECLARING the INP Retirees
entitled to the same or identical
retirement benefits and such other
benefits being granted, accorded
and bestowed upon the PNP
Retirees under the PNP Law (RA
No. 6975, as amended).

operational control over the transferred,

merged and/or absorbed AFP and INP
units. The incumbent Director General of
the PC-INP shall continue to act as
Director General of the PNP until
replaced .

The
respondents
Government Departments and
Agencies shall IMMEDIATELY
EFFECT and IMPLEMENT the
proper adjustments on the INP
Retirees retirement and such
other benefits, RETROACTIVE to
its date of effectivity, and
RELEASE and PAY to the INP
Retirees the due payments of the
amounts.
SO ORDERED.
DBM, PNP, NAPOLCOM
interposed an appeal to the CA

and

CSC,

The CA affirmed that of the trial court

upholding the entitlement of the INP retirees to the same
or identical retirement benefits accorded upon PNP
retirees. Their motion for reconsideration having been
denied by the CA in` its equally assailed resolution of
August 24, 2005, hence this petition.

Issue:
WON the trial court erred when it ordered for the
immediate adjustments of the respondents
retirement benefits.
Held:
We DENY.
Pursuant to Section 23 of R.A. No. 6975, the
PNP initially consisted of the members of the police
forces who were integrated into the INP by virtue of P.D.
No. 765, while Section 86 of the same law provides for
the assumption by the PNP of the police functions of the
INP and its absorption by the former, including its
appropriations, funds, records, equipment, etc., as well
as its personnel.
The PC officers and
enlisted personnel who have not
opted to join the PNP shall be
reassigned to the Army, Navy or
Air Force, or shall be allowed to
retire under existing AFP rules and
regulations. Any PC-INP officer
or enlisted personnel may,
within the twelve-month period
from the effectivity of this Act,
retire and be paid retirement
benefits corresponding to a
position two (2) ranks higher
than his present grade, subject
to the conditions that at the time
he applies for retirement, he has
rendered at least twenty (20)
years of service and still has, at
most, twenty-four (24) months of
service remaining before the
compulsory retirement age as
provided by existing law for his
office.
Upon the effectivity of this Act,
the [DILG] Secretary shall exercise
administrative supervision as well as

From the foregoing, it appears clear that the

INP was never, as posited by the petitioners, abolished
or terminated out of existence by R.A. No. 6975.
Instead, what the law provides is for the absorption,
transfer, and/or merger of the INP, as well as the
other offices comprising the PC-INP, with the PNP. To
abolish is to do away with, to annul, abrogate or
destroy completely; to absorb is to assimilate,
incorporate or to take in. Merge means to cause to
combine or unite to become legally absorbed or
extinguished by merger while transfer denotes
movement from one position to another. Clearly,
abolition cannot be equated with absorption.
True it is that Section 90 of R.A. No. 6975
speaks of the INP [ceasing] to exist upon the effectivity
of the law. It ought to be stressed, however, that such
cessation is but the logical consequence of the INP
being absorbed by the PNP.
The INP, at the most, was merely transformed to
become the PNP, minus of course its military character
and complexion.
Under the amendatory law (R.A. No. 8551), the
application of rationalized retirement benefits to PNP
members who have meanwhile retired before its (R.A.
No. 8551) enactment was not prohibited. In fact, its
Section 38 explicitly states that the rationalized
retirement benefits schedule and program shall have
retroactive effect in favor of PNP members and officers
retired or separated from the time specified in the law.
To us, the aforesaid provision should be made
applicable to INP members who had retired prior to the
effectivity of R.A. No. 6975. For, as afore-held, the INP
was, in effect, merely absorbed by the PNP and not
abolished.
In a further bid to scuttle respondents
entitlement to the desired retirement benefits, the
petitioners fault the trial court for ordering the immediate
adjustments of the respondents retirement benefits
when the basic petition filed before it was one for
declaratory relief. To the petitioners, such petition does
not essentially entail an executory process, the only
relief proper under that setting being a declaration of the
parties rights and duties.
Petitioners above posture is valid to a point.
However, the execution of judgments in a petition for
declaratory relief is not necessarily indefensible.
The Court sees no reason for treating this
case differently from PDIC and Matalin. This disposition
becomes all the more appropriate considering that the
respondents, as petitioners in the RTC, pleaded for
the immediate adjustment of their retirement benefits
which, significantly, the herein petitioners, as
respondents in the same court, did not object to. Being
aware of said prayer, the petitioners then already knew
the logical consequence if, as it turned out, a declaratory
judgment is rendered in the respondents favor.
At bottom then, the trial courts judgment
forestalled multiplicity of suits which, needless to stress,
would only entail a long and arduous process.
Considering their obvious advanced years, the
respondents can hardly afford another protracted

proceedings. It is thus for this Court to already write finis

to this case.
WHEREFORE, the instant petition is DENIED
and the assailed decision and resolution of the CA,
respectively dated July 7, 2005 and August 24, 2005,
are AFFIRMED.
____________________________________________
Araneta, et al. vs. Hon. M. Gatmaitan, et al.
Nos. L-8895 and L-9191
April 30, 1957
FACTS: Because of the destruction of marine life and the
depletion of marine resources in San Miguel Bay in the
Bicol Region due to trawl operators, President
Magsaysay issued on April 5, 1954 Executive Order No.
22 prohibiting the use of trawls in San Miguel Bay. A
group of Otter trawl operators took the matter to the
court by filing a complaint for injunction and/or
declaratory relief with preliminary injunction with the
Court of First Instance of Manila praying that a writ of
preliminary injunction be issued to restrain the Secretary
of Agriculture and natural Resources and the Director of
Fisheries from enforcing said executive order; to declare
the same null and void, and for such other relief as may
be just and equitable in the premises.
ISSUE: WON the constitutionality of an executive order
can be ventilated in a declaratory relief
HELD: Yes. The Solicitor General avers that the
constitutionality of an executive order cannot be
ventilated in a declaratory relief proceeding. We find this
untenable, for this Court taking cognizance of an appeal
from the decision of the lower court in the case of Hilado
vs. De la Costa et al. which involves the constitutionality
of another executive order presented in an action for
declaratory relief, in effect accepted the propriety of such
action.
_____________________________________________
VICTORINO C. FRANCISCO, petitioner,
vs.
WINAI PERMSKUL and THE HON. COURT OF
APPEALS, respondents.
G.R. No. 81006 May 12, 1989
CRUZ, J.:
Facts: On May 21, 1984, the petitioner leased his
apartment in Makati to the private respondent for a
period of one year for the stipulated rental of P3,000 a
month. Pursuant to the lease contract, the private
respondent deposited with the petitioner the amount of
P9,000.00 to answer for unpaid rentals or any damage
to the leased premises except when caused by
reasonable wear and tear. On May 31, 1985, the private
respondent vacated the property. He thereafter
requested the refund of his deposit minus the sum of
P1,000.00, representing the rental for the additional ten
days of his occupancy after the expiration of the lease.
The petitioner rejected this request. He said the lessee
still owed him for other charges, including the electricity
and water bills and the sum of P2,500.00 for repainting
of the leased premises to restore them to their original
condition. The private respondent sued in the
Metropolitan Trial Court of Makati. After the submission
of position papers by the parties, a summary judgment
was rendered on October 11, 1985, sustaining the
complainant and holding that the repainting was not
chargeable to him. The defendant was ordered to pay
the plaintiff the amount of P7,750.00, representing the
balance of the deposit after deducting the water and
electricity charges. The plaintiff was also awarded the
sum of P1,250.00 as attorney's fees, plus the Costs.

This decision was appealed to the Regional Trial Court

of Makati and was affirmed by Judge de la Rama
through a memorandum decision. When the defendant
went to the Court of Appeals, his petition for review was
denied as so too was his motion for reconsideration, on
December 1, 1987. Hence, this instant petition to fault
the respondent court, principally for sustaining the
memorandum decision of the regional trial court. His
contention is that it violates Article VIII, Section 14 of the
Constitution. He asks that the case be remanded to the
regional trial court for a full blown hearing on the merits,
to be followed by a decision stating therein clearly and
distinctly the facts and the law on which it is based. For
his part, the private respondent demurs. He justifies the
memorandum decision as authorized by B.P. Blg. 129.
Issue: Whether or not the memorandum decision
authorized under Section 40 of B.P. Blg. 129 in the light
of Article VIII, Section 14 of the Constitution is valid
Held: Yes. The law does not define the memorandum
decision and simply suggests that the court may adopt
by reference the findings of fact and the conclusions of
law stated in the decision, order or resolution on appeal
before it. No particular form is prescribed; the conditions
for its use are not indicated. In fact, B.P. Blg. 129 does
not even employ the term "memorandum decision" in
Section 40 or elsewhere in the rest of the statute. This
phrase appears to have been introduced in this
jurisdiction not by that law but by Section 24 of the
Interim Rules and Guidelines, reading as follows:
Sec. 24. Memorandum decisions. -The judgment or
final resolution of a court in appealed cases may adopt
by reference the findings of fact and conclusions of law
contained in the decision or final order appealed from.
It is clear that where the decision of the appellate court
actually reproduces the findings of fact or the
conclusions of law of the court below, it is not a
memorandum decision as envisioned in the above
provision. The distinctive features of the memorandum
decision are, first, it is rendered by an appellate court,
and second, it incorporates by reference the findings of
fact or the conclusions of law contained in the decision,
order or ruling under review. Most likely, the purpose is
to affirm the decision, although it is not impossible that
the approval of the findings of fact by the lower court
may lead to a different conclusion of law by the higher
court. At any rate, the reason for allowing the
incorporation by reference is evidently to avoid the
cumbersome reproduction of the decision of the lower
court, or portions thereof, in the decision of the higher
court. The Idea is to avoid having to repeat in the body
of the latter decision the findings or conclusions of the
lower court since they are being approved or adopted
anyway. In the case at bar, the decision of the Court of
Appeals extensively quoted from the decision of the
metropolitan trial court. Although only incorporated by
reference in the memorandum decision of the regional
trial court, Judge Balita's decision was nevertheless
available to the Court of Appeals. It is this circumstance,
or even happenstance, if you will, that has validated the
memorandum decision challenged in this case and
spared it from constitutional infirmity. There was
substantial. compliance with Section 40 because of the
direct availability and actual review of the decision of
Judge Balita incorporated by reference in the
memorandum decision of Judge de la Rama. The
memorandum decision as then understood under the
Romero decision was a valid act at the time it was
rendered by Judge de la Rama and produced binding
legal effect.
Doctrine as to proper application of Section 40 of B.P.
129: The memorandum decision, to be valid, cannot
incorporate the findings of fact and the conclusions of

law of the lower court only by remote reference, which is

to say that the challenged decision is not easily and
immediately available to the person reading the
memorandum decision. For the incorporation by
reference to be allowed, it must provide for direct access
to the facts and the law being adopted, which must be
contained in a statement attached to the said decision.
In other words, the memorandum decision authorized
under Section 40 of B.P. Blg. 129 should actually
embody the findings of fact and conclusions of law of the
lower court in an annex attached to and made an
indispensable part of the decision.
_____________________________________________
New Frontier Sugar Corporation vs. Regional Trial
Court, Branch 39, Iloilo City
G.R. No. 165001, January 31, 2007
Austria-Martinez, J.
FACTS: Petitioner New Frontier Sugar Corporation is a
domestic corporation engaged in the business of raw
sugar milling. Foreseeing that it cannot meet its
obligations with its creditors as they fell due, petitioner
filed a Petition for the Declaration of State of Suspension
of Payments with Approval of Proposed Rehabilitation
Plan under the Interim Rules of Procedure on Corporate
Rehabilitation (2000). Finding the petition to be
sufficient in form and substance, the RTC issued a Stay
Order appointing Manuel B. Clemente as rehabilitation
receiver, ordering the latter to put up a bond, and setting
the initial hearing on the petition.

Certiorari is a remedy for the correction of errors

of jurisdiction, not errors of judgment. It is an original
and independent action that was not part of the trial that
had resulted in the rendition of the judgment or order
complained of. More importantly, since the issue is
jurisdiction, an original action for certiorari may be
directed against an interlocutory order of the lower
court prior to an appeal from the judgment; or where
there is no appeal or any plain, speedy or adequate
remedy. A petition for certiorari should be filed not later
than sixty days from the notice of judgment, order, or
resolution, and a motion for reconsideration is generally
required prior to the filing of a petition for certiorari, in
order to afford the tribunal an opportunity to correct the
alleged errors.
The Omnibus Order issued by the RTC is a final
order since it terminated the proceedings and dismissed
the case before the trial court; it leaves nothing more to
be done. As such, petitioners recourse is to file an
appeal from the Omnibus Order.
In this regard, A.M. No. 00-8-10-SC promulgated
by the Court on September 4, 2001 provides that a
petition for rehabilitation is considered a special
proceeding given that it seeks to establish the status of a
party or a particular fact. Accordingly, the period of
appeal provided in paragraph 19 (b) of the Interim Rules
Relative to the Implementation of Batas Pambansa Blg.
129 for special proceedings shall apply. Under said
paragraph 19 (b), the period of appeal shall be thirty (30)
days, a record of appeal being required.

One of petitioners creditors, the Equitable PCI

Bank (respondent bank), filed a Comment/Opposition
with Motion to Exclude Property, alleging that petitioner
is not qualified for corporate rehabilitation, as it can no
longer operate because it has no assets left.
Respondent bank also alleged that the financial
statements, schedule of debts and liabilities, inventory of
assets, affidavit of general financial condition, and
rehabilitation plan submitted by petitioner are misleading
and inaccurate since its properties have already been
foreclosed and transferred to respondent bank before
the petition for rehabilitation was filed, and petitioner, in
fact, still owes respondent bank deficiency liability.

However, it should be noted that the Court

issued A.M. No. 04-9-07-SC on September 14, 2004,
clarifying the proper mode of appeal in cases involving
corporate rehabilitation and intra-corporate
controversies. It is provided therein that all decisions
and final orders in cases falling under the Interim Rules
of Corporate Rehabilitation and the Interim Rules of
Procedure Governing Intra-Corporate Controversies
under Republic Act No. 8799 shall be appealed to the
CA through a petition for review under Rule 43 of the
Rules of Court to be filed within fifteen (15) days from
notice of the decision or final order of the RTC.

The RTC issued an Omnibus Order terminating

the proceedings and dismissing the case. Petitioner filed
an Omnibus Motion but this was denied by the RTC.

In any event, as previously stated, since what

petitioner filed was a petition for certiorari under Rule 65
of the Rules, the CA rightly dismissed the petition and
affirmed the assailed Orders.

Petitioner then filed with the CA a special civil

action for certiorari, which was denied by the CA.

WHEREFORE, the petition is DENIED for lack

of merit.

In dismissing the petition, the CA sustained the

findings of the RTC that since petitioner no longer has
sufficient assets and properties to continue with its
operations and answer its corresponding liabilities, it is
no longer eligible for rehabilitation. The CA also ruled
that even if the RTC erred in dismissing the petition, the
same could not be corrected anymore because what
petitioner filed before the CA was a special civil action
for certiorari under Rule 65 of the Rules of Court instead
of an ordinary appeal.

_____________________________________________
MICROSOFT CORPORATION, petitioner, vs. BEST
DEAL COMPUTER CENTER CORPORATION,
PERFECT DEAL CORPORATION, MARCOS C. YUEN
doing business as PERFECT BYTE COMPUTER
CENTER and HON. FLORENTINO M. ALUMBRES, in
his capacity as Presiding Judge, RTC-Br. 255, Las
Pias City, respondents.
G.R. No. 148029. September 24, 2002
BELLOSILLO , J.:

ISSUE: Whether or not the Petition for Certiorari filed

before the Court of Appeals is improper, appeal being an
available remedy.

Facts: Petitioner is a US-based corporation. It is not

doing business in the Philippines but has sued in the
court below solely to protect its intellectual property
rights.
On 4 December 2000 petitioner filed a complaint for
Injunction and Damages with Ex Parte Application for
Temporary Restraining Order and the Provisional
Measure of Preservation of Evidence against Best Deal
Computer Center Corporation, Perfect Deal Corporation

HELD: Yes. The CA correctly ruled that petitioner

availed of the wrong remedy when it filed a special civil
action for certiorari with the CA under Rule 65 of the
Rules of Court.

and Marcos C. Yuen doing business as Perfect Byte

Computer Center. It alleged that defendants without
authority or license copied, reproduced, distributed,
installed and/or loaded software programs owned by
Microsoft into computer units sold by them to their
customers in violation of its intellectual property rights. It
prayed for the issuance of a writ of preliminary injunction
to restrain and enjoin defendants from illegally
reproducing, selling and distributing unlicensed software
programs. It also applied for the issuance of an ex parte
order for the seizure and impounding of relevant
evidence that can be or may be found at defendants'
business premises. On 26 December 2000 the Las
Pias trial court set petitioner's prayer for a temporary
restraining order for hearing but at the same time denied
its application for an ex parte order ratiocinating that the
Intellectual Property Code does not expressly allow its
issuance and that, in any case, the TRIPS (TradeRelated Aspects of Intellectual Property Rights)
AGREEMENT cannot prevail over it. The court a quo
also opined that petitioner's application partook of a
search and seizure order available only in criminal
cases. Petitioner moved for reconsideration but the
same was denied. In the instant petition for certiorari
under Rule 65 of the Revised Rules of Court petitioner
submits that the court a quo gravely abused its
discretion amounting to lack or excess of jurisdiction
when it ruled that the law does not allow an ex parte
provisional remedy of seizure and impounding of
infringing evidence. Petitioner allegedly resorted to the
instant recourse because it had no appeal or any plain,
speedy and adequate remedy in the ordinary course of
law. It automatically invoked the jurisdiction of this Court
supposedly because of the importance of the issue
involved. It bypassed the Court of Appeals on the
premise that it would be useless to first seek recourse
thereat as the party aggrieved by the appellate court's
ruling would nonetheless elevate the matter to this
Court. By then, petitioner surmised, the level of
intellectual piracy would have worsened. Likewise,
petitioner presumes that direct resort to this Court is
justified as the petition involves a pure question of law
Issue: Whether or not the extraordinary writ of certiorari
will prosper.
Held: No.
1. For certiorari to lie, it must be shown that the tribunal,
board or officer exercising judicial functions acted
without or in excess of jurisdiction or with grave abuse of
discretion amounting to lack or excess of jurisdiction,
and that there is no appeal nor any plain, speedy and
adequate remedy in the ordinary course of law for the
purpose of amending or nullifying the proceeding. It
should be noted that the court below acted within its
jurisdiction when it took cognizance of the complaint for
injunction and damages filed by petitioner.
2. A special civil action for certiorari will prosper only if
grave abuse of discretion is manifested. For an abuse to
be grave the power must be exercised in an arbitrary or
despotic manner by reason of passion or personal
hostility. The abuse of discretion must be so patent and
gross as to amount to an evasion of a positive duty, or a
virtual refusal to perform the duty enjoined or act in
contemplation of law. There is grave abuse of discretion
when respondent acts in a capricious or whimsical
manner in the exercise of its judgment as to be
equivalent to lack of jurisdiction. In the instant case,
petitioner failed to point out specific instances where
grave abuse of discretion was allegedly committed. It
was never shown how respondent tribunal supposedly
exercised its power in a despotic, capricious or
whimsical manner. There being no hint of grave abuse of
discretion that can be attributed to the lower court,

hence, it could be safely held that the assailed orders

were rendered in the proper exercise of its jurisdiction.
As long as the respondent acted with jurisdiction, any
error committed by him or it in the exercise thereof will
amount to nothing more than an error of judgment which
may be reviewed or corrected only by appeal.
Petitioner's rights can be more appropriately addressed
in the appeal.

3. Petitioner's direct resort to this Court in the

guise of speedy justice was in utter disregard of the
hierarchy of courts. There is no exceptional or
compelling reason not to observe the hierarchy of
courts. Supreme Court's original jurisdiction to issue
writs of certiorari is not exclusive. It is shared by this
Court with Regional Trial Courts and with the Court of
Appeals. This concurrence of jurisdiction is not, however,
to be taken as according to parties seeking any of the
writs an absolute, unrestrained freedom of choice of the
court to which application therefor will be directed. There
is after all a hierarchy of courts. A direct invocation of the
Supreme Courts original jurisdiction to issue these writs
should be allowed only when there are special and
important reasons therefor, clearly and specifically set
out in the petition.