Persons 2017 Case Compilation

Persons 1st exam- Galas 2017
TANADA VS TUVERA 1985
Invoking the people's right to be informed on matters of public concern, a right recognized in Section 6, Article IV of the 1973 Philippine Constitution, 1 as well
as the principle that laws to be valid and enforceable must be published in the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of
mandamus to compel respondent public officials to publish, and/or cause the publication in the Official Gazette of various presidential decrees, letters of
instructions, general orders, proclamations, executive orders, letter of implementation and administrative orders.
Specifically, the publication of the following presidential issuances is sought:

XXX
The respondents, through the Solicitor General, would have this case dismissed outright on the ground that petitioners have no legal personality or standing
to bring the instant petition. The view is submitted that in the absence of any showing that petitioners are personally and directly affected or prejudiced by the
alleged non-publication of the presidential issuances in question 2 said petitioners are without the requisite legal personality to institute this mandamus
proceeding, they are not being "aggrieved parties" within the meaning of Section 3, Rule 65 of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.When any tribunal, corporation, board or person unlawfully neglects the performance of an act which the law specifically
enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use a rd enjoyment of a right or office to which such other
is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified petition in
the proper court alleging the facts with certainty and praying that judgment be rendered commanding the defendant, immediately or at some other specified
time, to do the act required to be done to Protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful
acts of the defendant.
Upon the other hand, petitioners maintain that since the subject of the petition concerns a public right and its object is to compel the performance of a public
duty, they need not show any specific interest for their petition to be given due course.
The issue posed is not one of first impression. As early as the 1910 case of Severino vs. Governor General, 3 this Court held that while the general rule is
that "a writ of mandamus would be granted to a private individual only in those cases where he has some private or particular interest to be subserved, or
some particular right to be protected, independent of that which he holds with the public at large," and "it is for the public officers exclusively to apply for the
writ when public rights are to be subserved [Mithchell vs. Boardmen, 79 M.e., 469]," nevertheless, "when the question is one of public right and the object of
the mandamus is to procure the enforcement of a public duty, the people are regarded as the real party in interest and the relator at whose instigation the
proceedings are instituted need not show that he has any legal or special interest in the result, it being sufficient to show that he is a citizen and as such
interested in the execution of the laws
Thus, in said case, this Court recognized the relator Lope Severino, a private individual, as a proper party to the mandamus proceedings brought to compel
the Governor General to call a special election for the position of municipal president in the town of Silay, Negros Occidental. Speaking for this Court, Mr.
Justice Grant T. Trent said:
1
We are therefore of the opinion that the weight of authority supports the proposition that the relator is a proper party to proceedings of this character when a
public right is sought to be enforced. If the general rule in America were otherwise, we think that it would not be applicable to the case at bar for the reason
'that it is always dangerous to apply a general rule to a particular case without keeping in mind the reason for the rule, because, if under the particular
circumstances the reason for the rule does not exist, the rule itself is not applicable and reliance upon the rule may well lead to error'
No reason exists in the case at bar for applying the general rule insisted upon by counsel for the respondent. The circumstances which surround this case
are different from those in the United States, inasmuch as if the relator is not a proper party to these proceedings no other person could be, as we have seen
that it is not the duty of the law officer of the Government to appear and represent the people in cases of this character.
The reasons given by the Court in recognizing a private citizen's legal personality in the aforementioned case apply squarely to the present petition. Clearly,
the right sought to be enforced by petitioners herein is a public right recognized by no less than the fundamental law of the land. If petitioners were not allowed
to institute this proceeding, it would indeed be difficult to conceive of any other person to initiate the same, considering that the Solicitor General, the
government officer generally empowered to represent the people, has entered his appearance for respondents in this case.
Respondents further contend that publication in the Official Gazette is not a sine qua non requirement for the effectivity of laws where the laws themselves
provide for their own effectivity dates. It is thus submitted that since the presidential issuances in question contain special provisions as to the date they are
to take effect, publication in the Official Gazette is not indispensable for their effectivity. The point stressed is anchored on Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise provided, ...
The interpretation given by respondent is in accord with this Court's construction of said article. In a long line of decisions, 4 this Court has ruled that publication
in the Official Gazette is necessary in those cases where the legislation itself does not provide for its effectivity date-for then the date of publication is material
for determining its date of effectivity, which is the fifteenth day following its publication-but not when the law itself provides for the date when it goes into effect.
Respondents' argument, however, is logically correct only insofar as it equates the effectivity of laws with the fact of publication. Considered in the light of
other statutes applicable to the issue at hand, the conclusion is easily reached that said Article 2 does not preclude the requirement of publication in the
Official Gazette, even if the law itself provides for the date of its effectivity. Thus, Section 1 of Commonwealth Act 638 provides as follows:
Section 1. There shall be published in the Official Gazette [1] all important legisiative acts and resolutions of a public nature of the, Congress of the
Philippines; [2] all executive and administrative orders and proclamations, except such as have no general applicability; [3] decisions or abstracts of decisions
of the Supreme Court and the Court of Appeals as may be deemed by said courts of sufficient importance to be so published; [4] such documents or classes
of documents as may be required so to be published by law; and [5] such documents or classes of documents as the President of the Philippines shall
determine from time to time to have general applicability and legal effect, or which he may authorize so to be published. ...
The clear object of the above-quoted provision is to give the general public adequate notice of the various laws which are to regulate their actions and conduct
as citizens. Without such notice and publication, there would be no basis for the application of the maxim "ignorantia legis non excusat." It would be the height
of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not even a constructive one.
2
Perhaps at no time since the establishment of the Philippine Republic has the publication of laws taken so vital significance that at this time when the people
have bestowed upon the President a power heretofore enjoyed solely by the legislature. While the people are kept abreast by the mass media of the debates
and deliberations in the Batasan Pambansaand for the diligent ones, ready access to the legislative recordsno such publicity accompanies the law-
making process of the President. Thus, without publication, the people have no means of knowing what presidential decrees have actually been promulgated,
much less a definite way of informing themselves of the specific contents and texts of such decrees. As the Supreme Court of Spain ruled: "Bajo la
denominacion generica de leyes, se comprenden tambien los reglamentos, Reales decretos, Instrucciones, Circulares y Reales ordines dictadas de
conformidad con las mismas por el Gobierno en uso de su potestad. 5
The very first clause of Section I of Commonwealth Act 638 reads: "There shall be published in the Official Gazette ... ." The word "shall" used therein imposes
upon respondent officials an imperative duty. That duty must be enforced if the Constitutional right of the people to be informed on matters of public concern
is to be given substance and reality. The law itself makes a list of what should be published in the Official Gazette. Such listing, to our mind, leaves respondents
with no discretion whatsoever as to what must be included or excluded from such publication.
The publication of all presidential issuances "of a public nature" or "of general applicability" is mandated by law. Obviously, presidential decrees that provide
for fines, forfeitures or penalties for their violation or otherwise impose a burden or. the people, such as tax and revenue measures, fall within this category.
Other presidential issuances which apply only to particular persons or class of persons such as administrative and executive orders need not be published
on the assumption that they have been circularized to all concerned. 6
It is needless to add that the publication of presidential issuances "of a public nature" or "of general applicability" is a requirement of due process. It is a rule
of law that before a person may be bound by law, he must first be officially and specifically informed of its contents. As Justice Claudio Teehankee said in
Peralta vs. COMELEC 7:
In a time of proliferating decrees, orders and letters of instructions which all form part of the law of the land, the requirement of due process and the Rule of
Law demand that the Official Gazette as the official government repository promulgate and publish the texts of all such decrees, orders and instructions so
that the people may know where to obtain their official and specific contents.
The Court therefore declares that presidential issuances of general application, which have not been published, shall have no force and effect. Some members
of the Court, quite apprehensive about the possible unsettling effect this decision might have on acts done in reliance of the validity of those presidential
decrees which were published only during the pendency of this petition, have put the question as to whether the Court's declaration of invalidity apply to P.D.s
which had been enforced or implemented prior to their publication. The answer is all too familiar. In similar situations in the past this Court had taken the
pragmatic and realistic course set forth in Chicot County Drainage District vs. Baxter Bank 8 to wit:
The courts below have proceeded on the theory that the Act of Congress, having been found to be unconstitutional, was not a law; that it was inoperative,
conferring no rights and imposing no duties, and hence affording no basis for the challenged decree. Norton v. Shelby County, 118 U.S. 425, 442; Chicago,
1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear, however, that such broad statements as to the effect of a determination of unconstitutionality
must be taken with qualifications. The actual existence of a statute, prior to such a determination, is an operative fact and may have consequences which
cannot justly be ignored. The past cannot always be erased by a new judicial declaration. The effect of the subsequent ruling as to invalidity may have to be
considered in various aspects-with respect to particular conduct, private and official. Questions of rights claimed to have become vested, of status, of prior
determinations deemed to have finality and acted upon accordingly, of public policy in the light of the nature both of the statute and of its previous application,
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demand examination. These questions are among the most difficult of those which have engaged the attention of courts, state and federal and it is manifest
from numerous decisions that an all-inclusive statement of a principle of absolute retroactive invalidity cannot be justified.
Consistently with the above principle, this Court in Rutter vs. Esteban 9 sustained the right of a party under the Moratorium Law, albeit said right had accrued
in his favor before said law was declared unconstitutional by this Court.
Similarly, the implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is "an operative fact which may have
consequences which cannot be justly ignored. The past cannot always be erased by a new judicial declaration ... that an all-inclusive statement of a principle
of absolute retroactive invalidity cannot be justified."
From the report submitted to the Court by the Clerk of Court, it appears that of the presidential decrees sought by petitioners to be published in the Official
Gazette, only Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and 1937 to 1939, inclusive, have not been so published. 10 Neither the subject
matters nor the texts of these PDs can be ascertained since no copies thereof are available. But whatever their subject matter may be, it is undisputed that
none of these unpublished PDs has ever been implemented or enforced by the government. In Pesigan vs. Angeles, 11 the Court, through Justice Ramon
Aquino, ruled that "publication is necessary to apprise the public of the contents of [penal] regulations and make the said penalties binding on the persons
affected thereby. " The cogency of this holding is apparently recognized by respondent officials considering the manifestation in their comment that "the
government, as a matter of policy, refrains from prosecuting violations of criminal laws until the same shall have been published in the Official Gazette or in
some other publication, even though some criminal laws provide that they shall take effect immediately.
WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished presidential issuances which are of general application,
and unless so published, they shall have no binding force and effect.
SO ORDERED.
DE ROY VS RAMOS 1988
This special civil action for certiorari seeks to declare null and void two (2) resolutions of the Special First Division of the Court of Appeals in the case of Luis
Bernal, Sr., et al. v. Felisa Perdosa De Roy, et al., CA-G.R. CV No. 07286. The first resolution promulgated on 30 September 1987 denied petitioners' motion
for extension of time to file a motion for reconsideration and directed entry of judgment since the decision in said case had become final; and the second
Resolution dated 27 October 1987 denied petitioners' motion for reconsideration for having been filed out of time.
At the outset, this Court could have denied the petition outright for not being verified as required by Rule 65 section 1 of the Rules of Court. However, even if
the instant petition did not suffer from this defect, this Court, on procedural and substantive grounds, would still resolve to deny it.
The facts of the case are undisputed. The firewall of a burned-out building owned by petitioners collapsed and destroyed the tailoring shop occupied by the
family of private respondents, resulting in injuries to private respondents and the death of Marissa Bernal, a daughter. Private respondents had been warned
by petitioners to vacate their shop in view of its proximity to the weakened wall but the former failed to do so. On the basis of the foregoing facts, the Regional
Trial Court. First Judicial Region, Branch XXXVIII, presided by the Hon. Antonio M. Belen, rendered judgment finding petitioners guilty of gross negligence
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and awarding damages to private respondents. On appeal, the decision of the trial court was affirmed in toto by the Court of Appeals in a decision promulgated
on August 17, 1987, a copy of which was received by petitioners on August 25, 1987. On September 9, 1987, the last day of the fifteen-day period to file an
appeal, petitioners filed a motion for extension of time to file a motion for reconsideration, which was eventually denied by the appellate court in the Resolution
of September 30, 1987. Petitioners filed their motion for reconsideration on September 24, 1987 but this was denied in the Resolution of October 27, 1987.
This Court finds that the Court of Appeals did not commit a grave abuse of discretion when it denied petitioners' motion for extension of time to file a motion
for reconsideration, directed entry of judgment and denied their motion for reconsideration. It correctly applied the rule laid down in Habaluyas Enterprises,
Inc. v. Japzon, [G.R. No. 70895, August 5, 1985,138 SCRA 461, that the fifteen-day period for appealing or for filing a motion for reconsideration cannot be
extended. In its Resolution denying the motion for reconsideration, promulgated on July 30, 1986 (142 SCRA 208), this Court en banc restated and clarified
the rule, to wit:
Beginning one month after the promulgation of this Resolution, the rule shall be strictly enforced that no motion for extension of time to file a motion for
reconsideration may be filed with the Metropolitan or Municipal Trial Courts, the Regional Trial Courts, and the Intermediate Appellate Court. Such a motion
may be filed only in cases pending with the Supreme Court as the court of last resort, which may in its sound discretion either grant or deny the extension
requested. (at p. 212)
Lacsamana v. Second Special Cases Division of the intermediate Appellate Court, [G.R. No. 73146-53, August 26, 1986, 143 SCRA 643], reiterated the rule
and went further to restate and clarify the modes and periods of appeal.
Bacaya v. Intermediate Appellate Court, [G.R. No. 74824, Sept. 15, 1986,144 SCRA 161],stressed the prospective application of said rule, and explained the
operation of the grace period, to wit:
In other words, there is a one-month grace period from the promulgation on May 30, 1986 of the Court's Resolution in the clarificatory Habaluyas case, or up
to June 30, 1986, within which the rule barring extensions of time to file motions for new trial or reconsideration is, as yet, not strictly enforceable.
Since petitioners herein filed their motion for extension on February 27, 1986, it is still within the grace period, which expired on June 30, 1986, and may still
be allowed.
This grace period was also applied in Mission v. Intermediate Appellate Court [G.R. No. 73669, October 28, 1986, 145 SCRA 306].]
In the instant case, however, petitioners' motion for extension of time was filed on September 9, 1987, more than a year after the expiration of the grace period
on June 30, 1986. Hence, it is no longer within the coverage of the grace period. Considering the length of time from the expiration of the grace period to the
promulgation of the decision of the Court of Appeals on August 25, 1987, petitioners cannot seek refuge in the ignorance of their counsel regarding said rule
for their failure to file a motion for reconsideration within the reglementary period.
Petitioners contend that the rule enunciated in the Habaluyas case should not be made to apply to the case at bar owing to the non-publication of the
Habaluyas decision in the Official Gazette as of the time the subject decision of the Court of Appeals was promulgated. Contrary to petitioners' view, there is
no law requiring the publication of Supreme Court decisions in the Official Gazette before they can be binding and as a condition to their becoming effective.
5
It is the bounden duty of counsel as lawyer in active law practice to keep abreast of decisions of the Supreme Court particularly where issues have been
clarified, consistently reiterated, and published in the advance reports of Supreme Court decisions (G. R. s) and in such publications as the Supreme Court
Reports Annotated (SCRA) and law journals.
This Court likewise finds that the Court of Appeals committed no grave abuse of discretion in affirming the trial court's decision holding petitioner liable under
Article 2190 of the Civil Code, which provides that "the proprietor of a building or structure is responsible for the damage resulting from its total or partial
collapse, if it should be due to the lack of necessary repairs.
Nor was there error in rejecting petitioners argument that private respondents had the "last clear chance" to avoid the accident if only they heeded the. warning
to vacate the tailoring shop and , therefore, petitioners prior negligence should be disregarded, since the doctrine of "last clear chance," which has been
applied to vehicular accidents, is inapplicable to this case.
WHEREFORE, in view of the foregoing, the Court Resolved to DENY the instant petition for lack of merit.
ATIENZA VS BRILLANTES JR.
This is a complaint by Lupo A. Atienza for Gross Immorality and Appearance of Impropriety against Judge Francisco Brillantes, Jr., Presiding Judge of the
Metropolitan Trial Court, Branch 20, Manila.
Complainant alleges that he has two children with Yolanda De Castro, who are living together at No. 34 Galaxy Street, Bel-Air Subdivision, Makati, Metro
Manila. He stays in said house, which he purchased in 1987, whenever he is in Manila.
In December 1991, upon opening the door to his bedroom, he saw respondent sleeping on his (complainant's) bed. Upon inquiry, he was told by the houseboy
that respondent had been cohabiting with De Castro. Complainant did not bother to wake up respondent and instead left the house after giving instructions to
his houseboy to take care of his children.
Thereafter, respondent prevented him from visiting his children and even alienated the affection of his children for him.
Complainant claims that respondent is married to one Zenaida Ongkiko with whom he has five children, as appearing in his 1986 and 1991 sworn statements
of assets and liabilities. Furthermore, he alleges that respondent caused his arrest on January 13, 1992, after he had a heated argument with De Castro inside
the latter's office.
For his part, respondent alleges that complainant was not married to De Castro and that the filing of the administrative action was related to complainant's
claim on the Bel-Air residence, which was disputed by De Castro.
Respondent denies that he caused complainant's arrest and claims that he was even a witness to the withdrawal of the complaint for Grave Slander filed by
De Castro against complainant. According to him, it was the sister of De Castro who called the police to arrest complainant.
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Respondent also denies having been married to Ongkiko, although he admits having five children with her. He alleges that while he and Ongkiko went through
a marriage ceremony before a Nueva Ecija town mayor on April 25, 1965, the same was not a valid marriage for lack of a marriage license. Upon the request
of the parents of Ongkiko, respondent went through another marriage ceremony with her in Manila on June 5, 1965. Again, neither party applied for a marriage
license. Ongkiko abandoned respondent 17 years ago, leaving their children to his care and custody as a single parent.
Respondent claims that when he married De Castro in civil rites in Los Angeles, California on December 4, 1991, he believed, in all good faith and for all legal
intents and purposes, that he was single because his first marriage was solemnized without a license.
Under the Family Code, there must be a judicial declaration of the nullity of a previous marriage before a party thereto can enter into a second marriage.
Article 40 of said Code provides:
The absolute nullity of a previous marriage may be invoked for the purposes of remarriage on the basis solely of a final judgment declaring such previous
marriage void.
Respondent argues that the provision of Article 40 of the Family Code does not apply to him considering that his first marriage took place in 1965 and was
governed by the Civil Code of the Philippines; while the second marriage took place in 1991 and governed by the Family Code.
Article 40 is applicable to remarriages entered into after the effectivity of the Family Code on August 3, 1988 regardless of the date of the first marriage.
Besides, under Article 256 of the Family Code, said Article is given "retroactive effect insofar as it does not prejudice or impair vested or acquired rights in
accordance with the Civil Code or other laws." This is particularly true with Article 40, which is a rule of procedure. Respondent has not shown any vested
right that was impaired by the application of Article 40 to his case.
The fact that procedural statutes may somehow affect the litigants' rights may not preclude their retroactive application to pending actions. The retroactive
application of procedural laws is not violative of any right of a person who may feel that he is adversely affected (Gregorio v. Court of Appeals, 26 SCRA 229
[1968]). The reason is that as a general rule no vested right may attach to, nor arise from, procedural laws (Billones v. Court of Industrial Relations, 14 SCRA
674 [1965]).
Respondent is the last person allowed to invoke good faith. He made a mockery of the institution of marriage and employed deceit to be able to cohabit with
a woman, who beget him five children.
Respondent passed the Bar examinations in 1962 and was admitted to the practice of law in 1963. At the time he went through the two marriage ceremonies
with Ongkiko, he was already a lawyer. Yet, he never secured any marriage license. Any law student would know that a marriage license is necessary before
one can get married. Respondent was given an opportunity to correct the flaw in his first marriage when he and Ongkiko were married for the second time.
His failure to secure a marriage license on these two occasions betrays his sinister motives and bad faith.
It is evident that respondent failed to meet the standard of moral fitness for membership in the legal profession.
7
While the deceit employed by respondent existed prior to his appointment as a Metropolitan Trial Judge, his immoral and illegal act of cohabiting with De
Castro began and continued when he was already in the judiciary.
The Code of Judicial Ethics mandates that the conduct of a judge must be free of a whiff of impropriety, not only with respect to his performance of his judicial
duties but also as to his behavior as a private individual. There is no duality of morality. A public figure is also judged by his private life. A judge, in order to
promote public confidence in the integrity and impartiality of the judiciary, must behave with propriety at all times, in the performance of his judicial duties and
in his everyday life. These are judicial guideposts too self-evident to be overlooked. No position exacts a greater demand on moral righteousness and
uprightness of an individual than a seat in the judiciary (Imbing v. Tiongzon, 229 SCRA 690 [1994]).
WHEREFORE, respondent is DISMISSED from the service with forfeiture of all leave and retirement benefits and with prejudice to reappointment in any
branch, instrumentality, or agency of the government, including government-owned and controlled corporations. This decision is immediately executory.
SO ORDERED.
CARLOS VS SANDOVAL 2008
ONLY a spouse can initiate an action to sever the marital bond for marriages solemnized during the effectivity of the Family Code, except cases commenced
prior to March 15, 2003. The nullity and annulment of a marriage cannot be declared in a judgment on the pleadings, summary judgment, or confession of
judgment.
We pronounce these principles as We review on certiorari the Decision[1] of the Court of Appeals (CA) which reversed and set aside the summary judgment[2]
of the Regional Trial Court (RTC) in an action for declaration of nullity of marriage, status of a child, recovery of property, reconveyance, sum of money, and
damages.
The Facts
The events that led to the institution of the instant suit are unveiled as follows:
Spouses Felix B. Carlos and Felipa Elemia died intestate. They left six parcels of land to their compulsory heirs, Teofilo Carlos and petitioner Juan De Dios
Carlos. The lots are particularly described as follows:
Parcel No. 1
Lot No. 162 of the MUNTINLUPA ESTATE SUBDIVISION, Case No. 6137 of the Court of Land Registration.
Exemption from the provisions of Article 567 of the Civil Code is specifically reserved.
Area: 1 hectare, 06 ares, 07 centares.
Parcel No. 2
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A parcel of land (Lot No. 159-B), being a portion of Lot 159, situated in the Bo. of Alabang, Municipality of Muntinlupa, Province of Rizal, x x x containing an
area of Thirteen Thousand Four Hundred Forty One (13,441) square meters.
Parcel No. 3
A parcel of land (Lot 159-B-2 of the subd. plan [LRC] Psd-325903, approved as a non-subd. project), being a portion of Lot 159-B [LRC] Psd- Alabang, Mun.
of Muntinlupa, Metro Manila, Island of Luzon. Bounded on the NE, points 2 to 4 by Lot 155, Muntinlupa Estate; on the SE, point 4 to 5 by Lot 159-B-5; on the
S, points 5 to 1 by Lot 159-B-3; on the W, points 1 to 2 by Lot 159-B-1 (Road widening) all of the subd. plan, containing an area of ONE HUNDRED THIRTY
(130) SQ. METERS, more or less.
PARCEL No. 4
A parcel of land (Lot 28-C of the subd. plan Psd-13-007090, being a portion of Lot 28, Muntinlupa Estate, L.R.C. Rec. No. 6137), situated in the Bo. of Alabang,
Mun. of Muntinlupa, Metro Manila. Bounded on the NE, along lines 1-2 by Lot 27, Muntinlupa Estate; on the East & SE, along lines 2 to 6 by Mangangata
River; and on the West., along line 6-1, by Lot 28-B of the subd. plan x x x containing an area of ONE THUSAND AND SEVENTY-SIX (1,076) SQUARE
METERS.
PARCEL No. 5
PARCELA DE TERRENO No. 50, Manzana No. 18, de la subd. de Solocan. Linda por el NW, con la parcela 49; por el NE, con la parcela 36; por el SE, con
la parcela 51; y por el SW, con la calle Dos Castillas. Partiendo de un punto marcado 1 en el plano, el cual se halla a S. gds. 01'W, 72.50 mts. Desde el punto
1 de esta manzana, que es un mojon de concreto de la Ciudad de Manila, situado on el esquina E. que forman las Calles Laong Laan y Dos. Castillas,
continiendo un extension superficial de CIENTO CINCUENTA (150) METROS CUADRADOS.
PARCEL No. 6
PARCELA DE TERRENO No. 51, Manzana No. 18, de la subd. De Solocon. Linda por el NW, con la parcela 50; por el NE, con la parcela 37; por el SE, con
la parcela 52; por el SW, con la Calle Dos Castillas. Partiendo de un punto Marcado 1 en el plano, el cual se halla at S. 43 gds. 01'E, 82.50 mts. Desde el
punto 1 de esta manzana, que es un mojon de concreto de la Ciudad de Manila, situado on el esquina E. que forman las Calles Laong Laan y Dos. Castillas,
continiendo una extension superficial de CIENTO CINCUENTA (150) METROS CUADRADOS.[3]
During the lifetime of Felix Carlos, he agreed to transfer his estate to Teofilo. The agreement was made in order to avoid the payment of inheritance taxes.
Teofilo, in turn, undertook to deliver and turn over the share of the other legal heir, petitioner Juan De Dios Carlos.
Eventually, the first three (3) parcels of land were transferred and registered in the name of Teofilo. These three (3) lots are now covered by Transfer Certificate
of Title (TCT) No. 234824 issued by the Registry of Deeds of Makati City; TCT No. 139061 issued by the Registry of Deeds of Makati City; and TCT No.
139058 issued by the Registry of Deeds of Makati City.
Parcel No. 4 was registered in the name of petitioner. The lot is now covered by TCT No. 160401 issued by the Registry of Deeds of Makati City.
On May 13, 1992, Teofilo died intestate. He was survived by respondents Felicidad and their son, Teofilo Carlos II (Teofilo II). Upon Teofilos death, Parcel
Nos. 5 & 6 were registered in the name of respondent Felicidad and co-respondent, Teofilo II. The said two (2) parcels of land are covered by TCT Nos.
219877 and 210878, respectively, issued by the Registry of Deeds of Manila.
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In 1994, petitioner instituted a suit against respondents before the RTC in Muntinlupa City, docketed as Civil Case No. 94-1964. In the said case, the parties
submitted and caused the approval of a partial compromise agreement. Under the compromise, the parties acknowledged their respective shares in the
proceeds from the sale of a portion of the first parcel of land. This includes the remaining 6,691-square-meter portion of said land.
On September 17, 1994, the parties executed a deed of extrajudicial partition, dividing the remaining land of the first parcel between them.
Meanwhile, in a separate case entitled Rillo v. Carlos,[4] 2,331 square meters of the second parcel of land were adjudicated in favor of plaintiffs Rillo. The
remaining 10,000-square meter portion was later divided between petitioner and respondents.
The division was incorporated in a supplemental compromise agreement executed on August 17, 1994, with respect to Civil Case No. 94-1964. The parties
submitted the supplemental compromise agreement, which was approved accordingly.
Petitioner and respondents entered into two more contracts in August 1994. Under the contracts, the parties equally divided between them the third and fourth
parcels of land.
In August 1995, petitioner commenced an action, docketed as Civil Case No. 95-135, against respondents before the court a quo with the following causes
of action: (a) declaration of nullity of marriage; (b) status of a child; (c) recovery of property; (d) reconveyance; and (e) sum of money and damages. The
complaint was raffled to Branch 256 of the RTC in Muntinlupa.
In his complaint, petitioner asserted that the marriage between his late brother Teofilo and respondent Felicidad was a nullity in view of the absence of the
required marriage license. He likewise maintained that his deceased brother was neither the natural nor the adoptive father of respondent Teofilo Carlos II.
Petitioner likewise sought the avoidance of the contracts he entered into with respondent Felicidad with respect to the subject real properties. He also prayed
for the cancellation of the certificates of title issued in the name of respondents. He argued that the properties covered by such certificates of title, including
the sums received by respondents as proceeds, should be reconveyed to him.
Finally, petitioner claimed indemnification as and by way of moral and exemplary damages, attorneys fees, litigation expenses, and costs of suit.
On October 16, 1995, respondents submitted their answer. They denied the material averments of petitioners complaint. Respondents contended that the
dearth of details regarding the requisite marriage license did not invalidate Felicidads marriage to Teofilo. Respondents declared that Teofilo II was the
illegitimate child of the deceased Teofilo Carlos with another woman.
On the grounds of lack of cause of action and lack of jurisdiction over the subject matter, respondents prayed for the dismissal of the case before the trial
court. They also asked that their counterclaims for moral and exemplary damages, as well as attorneys fees, be granted.
But before the parties could even proceed to pre-trial, respondents moved for summary judgment. Attached to the motion was the affidavit of the justice of
the peace who solemnized the marriage. Respondents also submitted the Certificate of Live Birth of respondent Teofilo II. In the certificate, the late Teofilo
Carlos and respondent Felicidad were designated as parents.
10
On January 5, 1996, petitioner opposed the motion for summary judgment on the ground of irregularity of the contract evidencing the marriage. In the same
breath, petitioner lodged his own motion for summary judgment. Petitioner presented a certification from the Local Civil Registrar of Calumpit, Bulacan,
certifying that there is no record of birth of respondent Teofilo II.
Petitioner also incorporated in the counter-motion for summary judgment the testimony of respondent Felicidad in another case. Said testimony was made in
Civil Case No. 89-2384, entitled Carlos v. Gorospe, before the RTC Branch 255, Las Pias. In her testimony, respondent Felicidad narrated that co-respondent
Teofilo II is her child with Teofilo.[5]
Subsequently, the Office of the City Prosecutor of Muntinlupa submitted to the trial court its report and manifestation, discounting the possibility of collusion
between the parties.
RTC and CA Dispositions
On April 8, 1996, the RTC rendered judgment, disposing as follows:
WHEREFORE, premises considered, defendants (respondents) Motion for Summary Judgment is hereby denied. Plaintiffs (petitioners) Counter-Motion for
Summary Judgment is hereby granted and summary judgment is hereby rendered in favor of plaintiff as follows:
1. Declaring the marriage between defendant Felicidad Sandoval and Teofilo Carlos solemnized at Silang, Cavite on May 14, 1962, evidenced by the Marriage
Certificate submitted in this case, null and void ab initio for lack of the requisite marriage license;
2. Declaring that the defendant minor, Teofilo S. Carlos II, is not the natural, illegitimate, or legally adopted child of the late Teofilo E. Carlos;
3. Ordering defendant Sandoval to pay and restitute to plaintiff the sum of P18,924,800.00 together with the interest thereon at the legal rate from date of
filing of the instant complaint until fully paid;
4. Declaring plaintiff as the sole and exclusive owner of the parcel of land, less the portion adjudicated to plaintiffs in Civil Case No. 11975, covered by TCT
No. 139061 of the Register of Deeds of Makati City, and ordering said Register of Deeds to cancel said title and to issue another title in the sole name of
plaintiff herein;
5. Declaring the Contract, Annex K of complaint, between plaintiff and defendant Sandoval null and void, and ordering the Register of Deeds of Makati City
to cancel TCT No. 139058 in the name of Teofilo Carlos, and to issue another title in the sole name of plaintiff herein;
6. Declaring the Contract, Annex M of the complaint, between plaintiff and defendant Sandoval null and void;
7. Ordering the cancellation of TCT No. 210877 in the names of defendant Sandoval and defendant minor Teofilo S. Carlos II and ordering the Register of
Deeds of Manila to issue another title in the exclusive name of plaintiff herein;
8. Ordering the cancellation of TCT No. 210878 in the name of defendant Sandoval and defendant Minor Teofilo S. Carlos II and ordering the Register of
Deeds of Manila to issue another title in the sole name of plaintiff herein.
Let this case be set for hearing for the reception of plaintiffs evidence on his claim for moral damages, exemplary damages, attorneys fees, appearance fees,
and litigation expenses on June 7, 1996 at 1:30 o'clock in the afternoon.
SO ORDERED.
11
Dissatisfied, respondents appealed to the CA. In the appeal, respondents argued, inter alia, that the trial court acted without or in excess of jurisdiction in
rendering summary judgment annulling the marriage of Teofilo, Sr. and Felicidad and in declaring Teofilo II as not an illegitimate child of Teofilo, Sr.
On October 15, 2002, the CA reversed and set aside the RTC ruling, disposing as follows:
WHEREFORE, the summary judgment appealed from is REVERSED and SET ASIDE and in lieu thereof, a new one is entered REMANDING the case to the
court of origin for further proceedings.
SO ORDERED.
The CA opined:
We find the rendition of the herein appealed summary judgment by the court a quo contrary to law and public policy as ensconced in the aforesaid safeguards.
The fact that it was appellants who first sought summary judgment from the trial court, did not justify the grant thereof in favor of appellee. Not being an action
to recover upon a claim or to obtain a declaratory relief, the rule on summary judgment apply (sic) to an action to annul a marriage. The mere fact that no
genuine issue was presented and the desire to expedite the disposition of the case cannot justify a misinterpretation of the rule. The first paragraph of Article
88 and 101 of the Civil Code expressly prohibit the rendition of decree of annulment of a marriage upon a stipulation of facts or a confession of judgment. Yet,
the affidavits annexed to the petition for summary judgment practically amount to these methods explicitly proscribed by the law.
We are not unmindful of appellees argument that the foregoing safeguards have traditionally been applied to prevent collusion of spouses in the matter of
dissolution of marriages and that the death of Teofilo Carlos on May 13, 1992 had effectively dissolved the marriage herein impugned. The fact, however, that
appellees own brother and appellant Felicidad Sandoval lived together as husband and wife for thirty years and that the annulment of their marriage is the
very means by which the latter is sought to be deprived of her participation in the estate left by the former call for a closer and more thorough inquiry into the
circumstances surrounding the case. Rather that the summary nature by which the court a quo resolved the issues in the case, the rule is to the effect that
the material facts alleged in the complaint for annulment of marriage should always be proved. Section 1, Rule 19 of the Revised Rules of Court provides:
Section 1. Judgment on the pleadings. Where an answer fails to tender an issue, or otherwise admits the material allegations of the adverse party's pleading,
the court may, on motion of that party, direct judgment on such pleading. But in actions for annulment of marriage or for legal separation, the material facts
alleged in the complaint shall always be proved. (Underscoring supplied)
Moreover, even if We were to sustain the applicability of the rules on summary judgment to the case at bench, Our perusal of the record shows that the finding
of the court a quo for appellee would still not be warranted. While it may be readily conceded that a valid marriage license is among the formal requisites of
marriage, the absence of which renders the marriage void ab initio pursuant to Article 80(3) in relation to Article 58 of the Civil Code the failure to reflect the
serial number of the marriage license on the marriage contract evidencing the marriage between Teofilo Carlos and appellant Felicidad Sandoval, although
irregular, is not as fatal as appellee represents it to be. Aside from the dearth of evidence to the contrary, appellant Felicidad Sandovals affirmation of the
existence of said marriage license is corroborated by the following statement in the affidavit executed by Godofredo Fojas, then Justice of the Peace who
officiated the impugned marriage, to wit:
12
That as far as I could remember, there was a marriage license issued at Silang, Cavite on May 14, 1962 as basis of the said marriage contract executed by
Teofilo Carlos and Felicidad Sandoval, but the number of said marriage license was inadvertently not placed in the marriage contract for the reason that it
was the Office Clerk who filled up the blanks in the Marriage Contract who in turn, may have overlooked the same.
Rather than the inferences merely drawn by the trial court, We are of the considered view that the veracity and credibility of the foregoing statement as well
as the motivations underlying the same should be properly threshed out in a trial of the case on the merits.
If the non-presentation of the marriage contract the primary evidence of marriage is not proof that a marriage did not take place, neither should appellants
non-presentation of the subject marriage license be taken as proof that the same was not procured. The burden of proof to show the nullity of the marriage, it
must be emphasized, rests upon the plaintiff and any doubt should be resolved in favor of the validity of the marriage.
Considering that the burden of proof also rests on the party who disputes the legitimacy of a particular party, the same may be said of the trial courts rejection
of the relationship between appellant Teofilo Carlos II and his putative father on the basis of the inconsistencies in appellant Felicidad Sandovals statements.
Although it had effectively disavowed appellants prior claims regarding the legitimacy of appellant Teofilo Carlos II, the averment in the answer that he is the
illegitimate son of appellees brother, to Our mind, did not altogether foreclose the possibility of the said appellants illegitimate filiation, his right to prove the
same or, for that matter, his entitlement to inheritance rights as such.
Without trial on the merits having been conducted in the case, We find appellees bare allegation that appellant Teofilo Carlos II was merely purchased from
an indigent couple by appellant Felicidad Sandoval, on the whole, insufficient to support what could well be a minors total forfeiture of the rights arising from
his putative filiation. Inconsistent though it may be to her previous statements, appellant Felicidad Sandovals declaration regarding the illegitimate filiation of
Teofilo Carlos II is more credible when considered in the light of the fact that, during the last eight years of his life, Teofilo Carlos allowed said appellant the
use of his name and the shelter of his household. The least that the trial court could have done in the premises was to conduct a trial on the merits in order to
be able to thoroughly resolve the issues pertaining to the filiation of appellant Teofilo Carlos II.
On November 22, 2006, petitioner moved for reconsideration and for the inhibition of the ponente, Justice Rebecca De Guia-Salvador. The CA denied the
twin motions.
Issues
In this petition under Rule 45, petitioner hoists the following issues:
1. That, in reversing and setting aside the Summary Judgment under the Decision, Annex A hereof, and in denying petitioners Motion for reconsideration
under the Resolution, Annex F hereof, with respect to the nullity of the impugned marriage, petitioner respectfully submits that the Court of Appeals committed
a grave reversible error in applying Articles 88 and 101 of the Civil Code, despite the fact that the circumstances of this case are different from that
contemplated and intended by law, or has otherwise decided a question of substance not theretofore decided by the Supreme Court, or has decided it in a
manner probably not in accord with law or with the applicable decisions of this Honorable Court;
13
2. That in setting aside and reversing the Summary Judgment and, in lieu thereof, entering another remanding the case to the court of origin for further
proceedings, petitioner most respectfully submits that the Court of Appeals committed a serious reversible error in applying Section 1, Rule 19 (now Section
1, Rule 34) of the Rules of Court providing for judgment on the pleadings, instead of Rule 35 governing Summary Judgments;
3. That in reversing and setting aside the Summary Judgment and, in lieu thereof, entering another remanding the case to the court of origin for further
proceedings, petitioner most respectfully submits that the Court of Appeals committed grave abuse of discretion, disregarded judicial admissions, made
findings on ground of speculations, surmises, and conjectures, or otherwise committed misapplications of the laws and misapprehension of the facts.[9]
(Underscoring supplied)
Essentially, the Court is tasked to resolve whether a marriage may be declared void ab initio through a judgment on the pleadings or a summary judgment
and without the benefit of a trial. But there are other procedural issues, including the capacity of one who is not a spouse in bringing the action for nullity of
marriage.
Our Ruling
I. The grounds for declaration of absolute nullity of marriage must be proved. Neither judgment on the pleadings nor summary judgment is allowed. So is
confession of judgment disallowed.
Petitioner faults the CA in applying Section 1, Rule 19[10] of the Revised Rules of Court, which provides:
SECTION 1. Judgment on the pleadings. Where an answer fails to tender an issue, or otherwise admits the material allegations of the adverse partys pleading,
the court may, on motion of that party, direct judgment on such pleading. But in actions for annulment of marriage or for legal separation, the material facts
alleged in the complaint shall always be proved.
He argues that the CA should have applied Rule 35 of the Rules of Court governing summary judgment, instead of the rule on judgment on the pleadings.
Petitioner is misguided. The CA did not limit its finding solely within the provisions of the Rule on judgment on the pleadings. In disagreeing with the trial court,
the CA likewise considered the provisions on summary judgments, to wit:
Moreover, even if We are to sustain the applicability of the rules on summary judgment to the case at bench, Our perusal of the record shows that the finding
of the court a quo for appellee would still not be warranted. x x x[11]
But whether it is based on judgment on the pleadings or summary judgment, the CA was correct in reversing the summary judgment rendered by the trial
court. Both the rules on judgment on the pleadings and summary judgments have no place in cases of declaration of absolute nullity of marriage and even in
annulment of marriage.
14
With the advent of A.M. No. 02-11-10-SC, known as Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages, the
question on the application of summary judgments or even judgment on the pleadings in cases of nullity or annulment of marriage has been stamped with
clarity. The significant principle laid down by the said Rule, which took effect on March 15, 2003[12] is found in Section 17, viz.:
SEC. 17. Trial. (1) The presiding judge shall personally conduct the trial of the case. No delegation of evidence to a commissioner shall be allowed except as
to matters involving property relations of the spouses.
(2) The grounds for declaration of absolute nullity or annulment of marriage must be proved. No judgment on the pleadings, summary judgment, or confession
of judgment shall be allowed. (Underscoring supplied)
Likewise instructive is the Courts pronouncement in Republic v. Sandiganbayan.[13] In that case, We excluded actions for nullity or annulment of marriage
from the application of summary judgments.
Prescinding from the foregoing discussion, save for annulment of marriage or declaration of its nullity or for legal separation, summary judgment is applicable
to all kinds of actions.[14] (Underscoring supplied)
By issuing said summary judgment, the trial court has divested the State of its lawful right and duty to intervene in the case. The participation of the State is
not terminated by the declaration of the public prosecutor that no collusion exists between the parties. The State should have been given the opportunity to
present controverting evidence before the judgment was rendered.[15]
Both the Civil Code and the Family Code ordain that the court should order the prosecuting attorney to appear and intervene for the State. It is at this stage
when the public prosecutor sees to it that there is no suppression of evidence. Concomitantly, even if there is no suppression of evidence, the public prosecutor
has to make sure that the evidence to be presented or laid down before the court is not fabricated.
To further bolster its role towards the preservation of marriage, the Rule on Declaration of Absolute Nullity of Void Marriages reiterates the duty of the public
prosecutor, viz.:
SEC. 13. Effect of failure to appear at the pre-trial. (a) x x x
(b) x x x If there is no collusion, the court shall require the public prosecutor to intervene for the State during the trial on the merits to prevent suppression or
fabrication of evidence. (Underscoring supplied)
Truly, only the active participation of the public prosecutor or the Solicitor General will ensure that the interest of the State is represented and protected in
proceedings for declaration of nullity of marriages by preventing the fabrication or suppression of evidence.[16]
II. A petition for declaration of absolute nullity of void marriage may be filed solely by the husband or wife. Exceptions: (1) Nullity of marriage cases commenced
before the effectivity of A.M. No. 02-11-10-SC; and (2) Marriages celebrated during the effectivity of the Civil Code.
15
Under the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages, the petition for declaration of absolute nullity of
marriage may not be filed by any party outside of the marriage. The Rule made it exclusively a right of the spouses by stating:
SEC. 2. Petition for declaration of absolute nullity of void marriages.
(a) Who may file. A petition for declaration of absolute nullity of void marriage may be filed solely by the husband or the wife. (Underscoring supplied)
Section 2(a) of the Rule makes it the sole right of the husband or the wife to file a petition for declaration of absolute nullity of void marriage. The rationale of
the Rule is enlightening, viz.:
Only an aggrieved or injured spouse may file a petition for annulment of voidable marriages or declaration of absolute nullity of void marriages. Such petition
cannot be filed by compulsory or intestate heirs of the spouses or by the State. The Committee is of the belief that they do not have a legal right to file the
petition. Compulsory or intestate heirs have only inchoate rights prior to the death of their predecessor, and, hence, can only question the validity of the
marriage of the spouses upon the death of a spouse in a proceeding for the settlement of the estate of the deceased spouse filed in the regular courts. On
the other hand, the concern of the State is to preserve marriage and not to seek its dissolution.[17] (Underscoring supplied)
The new Rule recognizes that the husband and the wife are the sole architects of a healthy, loving, peaceful marriage. They are the only ones who can decide
when and how to build the foundations of marriage. The spouses alone are the engineers of their marital life. They are simultaneously the directors and actors
of their matrimonial true-to-life play. Hence, they alone can and should decide when to take a cut, but only in accordance with the grounds allowed by law.
The innovation incorporated in A.M. No. 02-11-10-SC sets forth a demarcation line between marriages covered by the Family Code and those solemnized
under the Civil Code. The Rule extends only to marriages entered into during the effectivity of the Family Code which took effect on August 3, 1988.[18]
The advent of the Rule on Declaration of Absolute Nullity of Void Marriages marks the beginning of the end of the right of the heirs of the deceased spouse
to bring a nullity of marriage case against the surviving spouse. But the Rule never intended to deprive the compulsory or intestate heirs of their successional
rights.
While A.M. No. 02-11-10-SC declares that a petition for declaration of absolute nullity of marriage may be filed solely by the husband or the wife, it does not
mean that the compulsory or intestate heirs are without any recourse under the law. They can still protect their successional right, for, as stated in the Rationale
of the Rules on Annulment of Voidable Marriages and Declaration of Absolute Nullity of Void Marriages, compulsory or intestate heirs can still question the
validity of the marriage of the spouses, not in a proceeding for declaration of nullity but upon the death of a spouse in a proceeding for the settlement of the
estate of the deceased spouse filed in the regular courts.[19]
It is emphasized, however, that the Rule does not apply to cases already commenced before March 15, 2003 although the marriage involved is within the
coverage of the Family Code. This is so, as the new Rule which became effective on March 15, 2003[20] is prospective in its application. Thus, the Court held
in Enrico v. Heirs of Sps. Medinaceli,[21] viz.:
16
As has been emphasized, A.M. No. 02-11-10-SC covers marriages under the Family Code of the Philippines, and is prospective in its application.[22]
(Underscoring supplied)
Petitioner commenced the nullity of marriage case against respondent Felicidad in 1995. The marriage in controversy was celebrated on May 14, 1962. Which
law would govern depends upon when the marriage took place.[23]
The marriage having been solemnized prior to the effectivity of the Family Code, the applicable law is the Civil Code which was the law in effect at the time of
its celebration.[24] But the Civil Code is silent as to who may bring an action to declare the marriage void. Does this mean that any person can bring an action
for the declaration of nullity of marriage?
We respond in the negative. The absence of a provision in the Civil Code cannot be construed as a license for any person to institute a nullity of marriage
case. Such person must appear to be the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the
suit.[25] Elsewise stated, plaintiff must be the real party-in-interest. For it is basic in procedural law that every action must be prosecuted and defended in the
name of the real party-in-interest.
Interest within the meaning of the rule means material interest or an interest in issue to be affected by the decree or judgment of the case, as distinguished
from mere curiosity about the question involved or a mere incidental interest. One having no material interest to protect cannot invoke the jurisdiction of the
court as plaintiff in an action. When plaintiff is not the real party-in-interest, the case is dismissible on the ground of lack of cause of action.[27]
Illuminating on this point is Amor-Catalan v. Court of Appeals,[28] where the Court held:
True, under the New Civil Code which is the law in force at the time the respondents were married, or even in the Family Code, there is no specific provision
as to who can file a petition to declare the nullity of marriage; however, only a party who can demonstrate proper interest can file the same. A petition to
declare the nullity of marriage, like any other actions, must be prosecuted or defended in the name of the real party-in-interest and must be based on a cause
of action. Thus, in Nial v. Badayog, the Court held that the children have the personality to file the petition to declare the nullity of marriage of their deceased
father to their stepmother as it affects their successional rights.
xxxx
In fine, petitioners personality to file the petition to declare the nullity of marriage cannot be ascertained because of the absence of the divorce decree and
the foreign law allowing it. Hence, a remand of the case to the trial court for reception of additional evidence is necessary to determine whether respondent
Orlando was granted a divorce decree and whether the foreign law which granted the same allows or restricts remarriage. If it is proved that a valid divorce
decree was obtained and the same did not allow respondent Orlandos remarriage, then the trial court should declare respondents marriage as bigamous and
void ab initio but reduced the amount of moral damages from P300,000.00 to P50,000.00 and exemplary damages from P200,000.00 to P25,000.00. On the
contrary, if it is proved that a valid divorce decree was obtained which allowed Orlando to remarry, then the trial court must dismiss the instant petition to
declare nullity of marriage on the ground that petitioner Felicitas Amor-Catalan lacks legal personality to file the same.
III. The case must be remanded to determine whether or not petitioner is a real-party-in-interest to seek the declaration of nullity of the marriage in controversy.
17
In the case at bench, the records reveal that when Teofilo died intestate in 1992, his only surviving compulsory heirs are respondent Felicidad and their son,
Teofilo II. Under the law on succession, successional rights are transmitted from the moment of death of the decedent and the compulsory heirs are called to
succeed by operation of law.[30]
Upon Teofilos death in 1992, all his property, rights and obligations to the extent of the value of the inheritance are transmitted to his compulsory heirs. These
heirs were respondents Felicidad and Teofilo II, as the surviving spouse and child, respectively.
Article 887 of the Civil Code outlined who are compulsory heirs, to wit:
(1) Legitimate children and descendants, with respect to their legitimate parents and ascendants;
(2) In default of the foregoing, legitimate parents and ascendants, with respect to their legitimate children and descendants;
(3) The widow or widower;
(4) Acknowledged natural children, and natural children by legal fiction;
(5) Other illegitimate children referred to in Article 287 of the Civil Code.[31]
Clearly, a brother is not among those considered as compulsory heirs. But although a collateral relative, such as a brother, does not fall within the ambit of a
compulsory heir, he still has a right to succeed to the estate. Articles 1001 and 1003 of the New Civil Code provide:
ART. 1001. Should brothers and sisters or their children survive with the widow or widower, the latter shall be entitled to one-half of the inheritance and the
brothers and sisters or their children to the other half.
ART. 1003. If there are no descendants, ascendants, illegitimate children, or a surviving spouse, the collateral relatives shall succeed to the entire estate of
the deceased in accordance with the following articles. (Underscoring supplied)
Indeed, only the presence of descendants, ascendants or illegitimate children excludes collateral relatives from succeeding to the estate of the decedent. The
presence of legitimate, illegitimate, or adopted child or children of the deceased precludes succession by collateral relatives.[32] Conversely, if there are no
descendants, ascendants, illegitimate children, or a surviving spouse, the collateral relatives shall succeed to the entire estate of the decedent.[33]
If respondent Teofilo II is declared and finally proven not to be the legitimate, illegitimate, or adopted son of Teofilo, petitioner would then have a personality
to seek the nullity of marriage of his deceased brother with respondent Felicidad. This is so, considering that collateral relatives, like a brother and sister,
acquire successional right over the estate if the decedent dies without issue and without ascendants in the direct line.
The records reveal that Teofilo was predeceased by his parents. He had no other siblings but petitioner. Thus, if Teofilo II is finally found and proven to be
not a legitimate, illegitimate, or adopted son of Teofilo, petitioner succeeds to the other half of the estate of his brother, the first half being allotted to the widow
pursuant to Article 1001 of the New Civil Code. This makes petitioner a real-party-interest to seek the declaration of absolute nullity of marriage of his deceased
brother with respondent Felicidad. If the subject marriage is found to be void ab initio, petitioner succeeds to the entire estate.
18
It bears stressing, however, that the legal personality of petitioner to bring the nullity of marriage case is contingent upon the final declaration that Teofilo II is
not a legitimate, adopted, or illegitimate son of Teofilo.
If Teofilo II is proven to be a legitimate, illegitimate, or legally adopted son of Teofilo, then petitioner has no legal personality to ask for the nullity of marriage
of his deceased brother and respondent Felicidad. This is based on the ground that he has no successional right to be protected, hence, does not have proper
interest. For although the marriage in controversy may be found to be void from the beginning, still, petitioner would not inherit. This is because the presence
of descendant, illegitimate,[34] or even an adopted child[35] excludes the collateral relatives from inheriting from the decedent.
Thus, the Court finds that a remand of the case for trial on the merits to determine the validity or nullity of the subject marriage is called for. But the RTC is
strictly instructed to dismiss the nullity of marriage case for lack of cause of action if it is proven by evidence that Teofilo II is a legitimate, illegitimate, or legally
adopted son of Teofilo Carlos, the deceased brother of petitioner.
IV. Remand of the case regarding the question of filiation of respondent Teofilo II is proper and in order. There is a need to vacate the disposition of the trial
court as to the other causes of action before it.
Petitioner did not assign as error or interpose as issue the ruling of the CA on the remand of the case concerning the filiation of respondent Teofilo II. This
notwithstanding, We should not leave the matter hanging in limbo.
This Court has the authority to review matters not specifically raised or assigned as error by the parties, if their consideration is necessary in arriving at a just
resolution of the case.[36]
We agree with the CA that without trial on the merits having been conducted in the case, petitioners bare allegation that respondent Teofilo II was adopted
from an indigent couple is insufficient to support a total forfeiture of rights arising from his putative filiation. However, We are not inclined to support its
pronouncement that the declaration of respondent Felicidad as to the illegitimate filiation of respondent Teofilo II is more credible. For the guidance of the
appellate court, such declaration of respondent Felicidad should not be afforded credence. We remind the CA of the guaranty provided by Article 167 of the
Family Code to protect the status of legitimacy of a child, to wit:
ARTICLE 167. The child shall be considered legitimate although the mother may have declared against its legitimacy or may have been sentenced as an
adulteress. (Underscoring supplied)
It is stressed that Felicidads declaration against the legitimate status of Teofilo II is the very act that is proscribed by Article 167 of the Family Code. The
language of the law is unmistakable. An assertion by the mother against the legitimacy of her child cannot affect the legitimacy of a child born or conceived
within a valid marriage.[37]
Finally, the disposition of the trial court in favor of petitioner for causes of action concerning reconveyance, recovery of property, and sum of money must be
vacated. This has to be so, as said disposition was made on the basis of its finding that the marriage in controversy was null and void ab initio.
WHEREFORE, the appealed Decision is MODIFIED as follows:
19
1. The case is REMANDED to the Regional Trial Court in regard to the action on the status and filiation of respondent Teofilo Carlos II and the validity or
nullity of marriage between respondent Felicidad Sandoval and the late Teofilo Carlos;
2. If Teofilo Carlos II is proven to be the legitimate, or illegitimate, or legally adopted son of the late Teofilo Carlos, the RTC is strictly INSTRUCTED to
DISMISS the action for nullity of marriage for lack of cause of action;
3. The disposition of the RTC in Nos. 1 to 8 of the fallo of its decision is VACATED AND SET ASIDE.
The Regional Trial Court is ORDERED to conduct trial on the merits with dispatch and to give this case priority in its calendar.
No costs.
SO ORDERED.
CHENG VS SY 2009
This is a petition[1] for review on certiorari under Rule 45 of the Rules of Court of the Order dated January 2, 2006[2] of the Regional Trial Court (RTC), Branch
18, Manila in Civil Case No. 05-112452 entitled Anita Cheng v. Spouses William Sy and Tessie Sy.
The antecedents are as follows
Petitioner Anita Cheng filed two (2) estafa cases before the RTC, Branch 7, Manila against respondent spouses William and Tessie Sy (Criminal Case No.
98-969952 against Tessie Sy and Criminal Case No. 98-969953 against William Sy) for issuing to her Philippine Bank of Commerce (PBC) Check Nos.
171762 and 71860 for P300,000.00 each, in payment of their loan, both of which were dishonored upon presentment for having been drawn against a closed
account.
Meanwhile, based on the same facts, petitioner, on January 20, 1999, filed against respondents two (2) cases for violation of Batas Pambansa Bilang (BP
Blg.) 22 before the Metropolitan Trial Court (MeTC), Branch 25, Manila (Criminal Case Nos. 341458-59).
On March 16, 2004, the RTC, Branch 7, Manila dismissed the estafa cases for failure of the prosecution to prove the elements of the crime. The Order
dismissing Criminal Case No. 98-969952 contained no declaration as to the civil liability of Tessie Sy.[3] On the other hand, the Order in Criminal Case No.
98-969953 contained a statement, Hence, if there is any liability of the accused, the same is purely civil, not criminal in nature.[4]
Later, the MeTC, Branch 25, Manila, dismissed, on demurrer, the BP Blg. 22 cases in its Order[5] dated February 7, 2005 on account of the failure of petitioner
to identify the accused respondents in open court. The Order also did not make any pronouncement as to the civil liability of accused respondents.
On April 26, 2005, petitioner lodged against respondents before the RTC, Branch 18, Manila, a complaint[6] for collection of a sum of money with damages
(Civil Case No. 05-112452) based on the same loaned amount of P600,000.00 covered by the two PBC checks previously subject of the estafa and BP Blg.
22 cases.
20
In the assailed Order[7] dated January 2, 2006, the RTC, Branch 18, Manila, dismissed the complaint for lack of jurisdiction, ratiocinating that the civil action
to collect the amount of P600,000.00 with damages was already impliedly instituted in the BP Blg. 22 cases in light of Section 1, paragraph (b) of Rule 111 of
the Revised Rules of Court.
Petitioner filed a motion for reconsideration[8] which the court denied in its Order[9] dated June 5, 2006. Hence, this petition, raising the sole legal issue
Whether or not Section 1 of Rule 111 of the 2000 Rules of Criminal Procedure and Supreme Court Circular No. 57-97 on the Rules and Guidelines in the
filing and prosecution of criminal cases under BP Blg. 22 are applicable to the present case where the nature of the order dismissing the cases for bouncing
checks against the respondents was [based] on the failure of the prosecution to identify both the accused (respondents herein)?[10]
Essentially, petitioner argues that since the BP Blg. 22 cases were filed on January 20, 1999, the 2000 Revised Rules on Criminal Procedure promulgated
on December 1, 2000 should not apply, as it must be given only prospective application. She further contends that that her case falls within the following
exceptions to the rule that the civil action correspondent to the criminal action is deemed instituted with the latter
(1) additional evidence as to the identities of the accused is necessary for the resolution of the civil aspect of the case;
(2) a separate complaint would be just as efficacious as or even more expedient than a timely remand to the trial court where the criminal action was decided
for further hearings on the civil aspect of the case;
(3) the trial court failed to make any pronouncement as to the civil liability of the accused amounting to a reservation of the right to have the civil liability
litigated in a separate action;
(4) the trial court did not declare that the facts from which the civil liability might arise did not exist;
(5) the civil complaint is based on an obligation ex-contractu and not ex-delicto pursuant to Article 31[11] of the Civil Code; and
(6) the claim for civil liability for damages may be had under Article 29[12] of the Civil Code.
Petitioner also points out that she was not assisted by any private prosecutor in the BP Blg. 22 proceedings.
The rule is that upon the filing of the estafa and BP Blg. 22 cases against respondents, where the petitioner has not made any waiver, express reservation to
litigate separately, or has not instituted the corresponding civil action to collect the amount of P600,000.00 and damages prior to the criminal action, the civil
action is deemed instituted with the criminal cases.[13]
This rule applies especially with the advent of the 2000 Revised Rules on Criminal Procedure. Thus, during the pendency of both the estafa and the BP Blg.
22 cases, the action to recover the civil liability was impliedly instituted and remained pending before the respective trial courts. This is consonant with our
ruling in Rodriguez v. Ponferrada[14] that the possible single civil liability arising from the act of issuing a bouncing check can be the subject of both civil
actions deemed instituted with the estafa case and the prosecution for violation of BP Blg. 22, simultaneously available to the complaining party, without
traversing the prohibition against forum shopping.[15] Prior to the judgment in either the estafa case or the BP Blg. 22 case, petitioner, as the complainant,
cannot be deemed to have elected either of the civil actions both impliedly instituted in the said criminal proceedings to the exclusion of the other.[16]
The dismissal of the estafa cases for failure of the prosecution to prove the elements of the crime beyond reasonable doubtwhere in Criminal Case No. 98-
969952 there was no pronouncement as regards the civil liability of the accused and in Criminal Case No. 98-969953 where the trial court declared that the
liability of the accused was only civil in natureproduced the legal effect of a reservation by the petitioner of her right to litigate separately the civil action
impliedly instituted with the estafa cases, following Article 29 of the Civil Code.[17]
21
However, although this civil action could have been litigated separately on account of the dismissal of the estafa cases on reasonable doubt, the petitioner
was deemed to have also elected that such civil action be prosecuted together with the BP Blg. 22 cases in light of the Rodriguez v. Ponferrada ruling.
With the dismissal of the BP Blg. 22 cases for failure to establish the identity of the accused, the question that arises is whether such dismissal would have
the same legal effect as the dismissed estafa cases. Put differently, may petitioners action to recover respondents civil liability be also allowed to prosper
separately after the BP Blg. 22 cases were dismissed?
Section 1 (b), Rule 111 of the 2000 Revised Rules on Criminal Procedure states
Section 1. Institution of criminal and civil actions.
xxx
(b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil
action separately shall be allowed.
Upon filing of the joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be
considered as the actual damages claimed. Where the complaint or information also seeks to recover liquidated, moral, nominal, temperate or exemplary
damages, the offended party shall pay the filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages [is]
subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first lien on the judgment.
Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with
the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing
consolidation of the civil and criminal actions.
Petitioner is in error when she insists that the 2000 Rules on Criminal Procedure should not apply because she filed her BP Blg. 22 complaints in 1999. It is
now settled that rules of procedure apply even to cases already pending at the time of their promulgation. The fact that procedural statutes may somehow
affect the litigants rights does not preclude their retroactive application to pending actions. It is axiomatic that the retroactive application of procedural laws
does not violate any right of a person who may feel that he is adversely affected, nor is it constitutionally objectionable. The reason for this is that, as a general
rule, no vested right may attach to, nor arise from, procedural laws.[18]
Indeed, under the present revised Rules, the criminal action for violation of BP Blg. 22 includes the corresponding civil action to recover the amount of the
checks. It should be stressed, this policy is intended to discourage the separate filing of the civil action. In fact, the Rules even prohibits the reservation of a
separate civil action, i.e., one can no longer file a separate civil case after the criminal complaint is filed in court. The only instance when separate proceedings
are allowed is when the civil action is filed ahead of the criminal case. Even then, the Rules encourages the consolidation of the civil and criminal cases. Thus,
where petitioners rights may be fully adjudicated in the proceedings before the court trying the BP Blg. 22 cases, resort to a separate action to recover civil
22
liability is clearly unwarranted on account of res judicata, for failure of petitioner to appeal the civil aspect of the cases. In view of this special rule governing
actions for violation of BP Blg. 22, Article 31 of the Civil Code is not applicable.[19]
Be it remembered that rules governing procedure before the courts, while not cast in stone, are for the speedy, efficient, and orderly dispensation of justice
and should therefore be adhered to in order to attain this objective.[20]
However, in applying the procedure discussed above, it appears that petitioner would be left without a remedy to recover from respondents the P600,000.00
allegedly loaned from her. This could prejudice even the petitioners Notice of Claim involving the same amount filed in Special Proceedings No. 98-88390
(Petition for Voluntary Insolvency by Kolin Enterprises, William Sy and Tessie Sy), which case was reportedly archived for failure to prosecute the petition for
an unreasonable length of time.[21] Expectedly, respondents would raise the same defense that petitioner had already elected to litigate the civil action to
recover the amount of the checks along with the BP Blg. 22 cases.
It is in this light that we find petitioners contention that she was not assisted by a private prosecutor during the BP Blg. 22 proceedings critical. Petitioner
indirectly protests that the public prosecutor failed to protect and prosecute her cause when he failed to have her establish the identities of the accused during
the trial and when he failed to appeal the civil action deemed impliedly instituted with the BP Blg. 22 cases. On this ground, we agree with petitioner.
Faced with the dismissal of the BP Blg. 22 cases, petitioners recourse pursuant to the prevailing rules of procedure would have been to appeal the civil action
to recover the amount loaned to respondents corresponding to the bounced checks. Hence, the said civil action may proceed requiring only a preponderance
of evidence on the part of petitioner. Her failure to appeal within the reglementary period was tantamount to a waiver altogether of the remedy to recover the
civil liability of respondents. However, due to the gross mistake of the prosecutor in the BP Blg. 22 cases, we are constrained to digress from this rule.
It is true that clients are bound by the mistakes, negligence and omission of their counsel.[22] But this rule admits of exceptions (1) where the counsels mistake
is so great and serious that the client is prejudiced and denied his day in court, or (2) where the counsel is guilty of gross negligence resulting in the clients
deprivation of liberty or property without due process of law.[23] Tested against these guidelines, we hold that petitioners lot falls within the exceptions.
It is an oft-repeated exhortation to counsels to be well-informed of existing laws and rules and to keep abreast with legal developments, recent enactments
and jurisprudence. Unless they faithfully comply with such duty, they may not be able to discharge competently and diligently their obligations as members of
the Bar.[24] Further, lawyers in the government service are expected to be more conscientious in the performance of their duties as they are subject to public
scrutiny. They are not only members of the Bar but are also public servants who owe utmost fidelity to public service.[25] Apparently, the public prosecutor
neglected to equip himself with the knowledge of the proper procedure for BP Blg. 22 cases under the 2000 Rules on Criminal Procedure such that he failed
to appeal the civil action impliedly instituted with the BP Blg. 22 cases, the only remaining remedy available to petitioner to be able to recover the money she
loaned to respondents, upon the dismissal of the criminal cases on demurrer. By this failure, petitioner was denied her day in court to prosecute the
respondents for their obligation to pay their loan.
Moreover, we take into consideration the trial courts observation when it dismissed the estafa charge in Criminal Case No. 98-969953 that if there was any
liability on the part of respondents, it was civil in nature. Hence, if the loan be proven true, the inability of petitioner to recover the loaned amount would be
tantamount to unjust enrichment of respondents, as they may now conveniently evade payment of their obligation merely on account of a technicality applied
against petitioner.
23
There is unjust enrichment when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of or with damages to another. This doctrine
simply means that a person shall not be allowed to profit or enrich himself inequitably at anothers expense. One condition for invoking this principle of unjust
enrichment is that the aggrieved party has no other recourse based on contract, quasi-contract, crime, quasi-delict or any other provision of law.[26]
Court litigations are primarily designed to search for the truth, and a liberal interpretation and application of the rules which will give the parties the fullest
opportunity to adduce proof is the best way to ferret out the truth. The dispensation of justice and vindication of legitimate grievances should not be barred by
technicalities.[27] For reasons of substantial justice and equity, as the complement of the legal jurisdiction that seeks to dispense justice where courts of law,
through the inflexibility of their rules and want of power to adapt their judgments to the special circumstances of cases, are incompetent to do so,[28] we thus
rule, pro hac vice, in favor of petitioner.
WHEREFORE, the petition is GRANTED. Civil Case No. 05-112452 entitled Anita Cheng v. Spouses William Sy and Tessie Sy is hereby ordered
REINSTATED. No pronouncement as to costs.
SO ORDERED.
CAROLINO VS SENGA 2015
Before us is a petition for review under Rule 45 seeking to reverse and set aside the Decision1 dated May 25, 2009 of the Court of Appeals (CA) in CA-G.R.
SP No. 103502 and the Resolution2 dated September 10, 2009 denying reconsideration thereof.
The factual and legal antecedents are as follows:
On December 1, 1976, Jeremias A. Carolino, petitioner's husband, retired3 from the Armed Forces of the Philippines (AFP) with the rank of Colonel under
General Order No. 1208 dated November 29, 1976, pursuant to the provisions of Sections 1(A) and 10 of Republic Act (RA) No. 340,4 as amended. He
started receiving his monthly retirement pay in the amount of P18,315.00 in December 1976 until the same was withheld by respondents in March 2005. On
June 3, 2005, Jeremias wrote a letter5 addressed to the AFP Chief of Staff asking for the reasons of the withholding of his retirement pay. In a letter reply,6
Myrna F. Villaruz, LTC (FS) PA, Pension and Gratuity Officer of the AFP Finance Center, informed Jeremias that his loss of Filipino citizenship caused the
deletion of his name in the alpha list of the AFP Pensioners' Payroll effective March 5, 2005; and that he could avail of re-entitlement to his retirement benefits
and the restoration of his name in the AFP Pensioners' Masterlist Payroll by complying with the requirements prescribed under RA No. 9225, or the Dual
Citizenship Act.
It appeared that the termination of Jeremias' pension was done pursuant to Disposition Form7 dated October 29, 2004, which was approved by the Chief of
Staff and made effective in January 2005. In the said Disposition Form, the AFP Judge Advocate General opined that under the provisions of Sections 4, 5,
and 6 of RA No. 340, retired military personnel are disqualified from receiving pension benefits once incapable to render military service as a result of his
having sworn allegiance to a foreign country. It was also mentioned that termination of retirement benefits of pensioner of the AFP could be done pursuant to
the provisions of Presidential Decree (PD) No. 16388 which provides that the name of a retiree who loses his Filipino citizenship shall be removed from the
retired list and his retirement benefits terminated upon such loss. It being in consonance with the policy consideration that all retirement laws inconsistent with
the provisions of PD No. 1638 are repealed and modified accordingly.
24
On August 24, 2006, Jeremias filed with the Regional Trial Court (RTC) of Quezon City, a Petition for Mandamus9 against Gen. Generoso Senga, as Chief
of Staff of the AFP, Brig. Gen. Fernando Zabat, as Chief of the AFP Finance Center, Comm. Reynaldo Basilio, as Chief of the AFP-GHQ Management and
Fiscal Office, and Comm. Emilio Marayag, Pension and Gratuity Management Officer, Pension and Gratuity Management Center, AFP Finance Center,
seeking reinstatement of his name in the list of the AFP retired officers, resumption of payment of his retirement benefits under RA No. 340, and the
reimbursement of all his retirement pay and benefits which accrued from March 5, 2005 up to the time his name is reinstated and, thereafter, with claim for
damages and attorney's fees. The case was docketed as Civil Case No. Q-06-58686, and raffled off to Branch 220.
On February 26, 2007, the RTC rendered its Decision10 granting the petition for mandamus, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered ordering General Hermogenes Esperon, Jr., as Chief of Staff of the AFP, Brigadier General Fernando Zabat, as
the Commanding Officer of the AFP Finance Center, Commodore Reynaldo Basilio, as Chief of the AFP-GFIQ Management and Fiscal Office, and Captain
Theresa M. Nicdao, as Pension and Gratuity Officer of the Pension and Gratuity Management Center, or any of their respective successors and those taking
instructions from them as agents or subordinates, to:
immediately reinstate the name of petitioner in the list of retired AFP Officers, and to resume payment of his retirement benefits under RA 340; and
release to [petitioner] all retirement benefits due him under RA 340 which accrued to him from March 2005 continuously up to the time his name is reinstated
in the list of AFP retired officers.11
The RTC found that the issue for resolution is the applicability of RA No. 340 and PD No. 1638 upon Jeremias' retirement benefits. It found that he retired as
a commissioned officer of the AFP in 1976; thus, RANo. 340 is the law applicable in determining his entitlement to his retirement benefits and not PD No.
1638 which was issued only in 1979. Article 4 of the Civil Code provides that "laws shall have no retroactive effect unless the contrary is provided." PD No.
1638 does not provide for such retroactive application. Also, it could not have been the intendment of PD No. 1638 to deprive its loyal soldiers of a monthly
pension during their old age especially where, as here, the right had been vested to them through time. RA No. 340 does not provide that the loss of Filipino
citizenship would terminate one's retirement benefits; and that PD No. 1638 does not reduce whatever benefits that any person has already been receiving
under existing law.
Respondents sought reconsideration, but the RTC denied the same in an Order13 dated May 25, 2007, the decretal portion of which reads:
WHEREFORE, premises considered, the instant Motion for Reconsideration is hereby DENIED, considering that the questioned decision has not yet
attained.its finality. The Motion for Execution in the meantime is hereby DENIED.14cralawlawlibrary
Aggrieved, respondents elevated the case to the CA. After the submission of the parties' respective memoranda, the case was submitted for decision.
Jeremias died on September 30, 200715 and was substituted by his wife, herein petitioner.
On May 25, 2009, the CA granted respondents' appeal. The dispositive portion of the CA decision reads:
WHEREFORE, premises considered, the instant appeal is GRANTED. The appealed decision is REVOKED and SET ASIDE.16cralawlawlibrary
In so ruling, the CA found that while it is true that Jeremias retired in 1976 under the provisions of RA No. 340, as amended, which does not contain any
provision anent cessation or loss of retirement benefits upon acquiring another citizenship, PD No. 1638, which was signed in 1979, effectively repealed RA
No. 340, as amended. Section 27 of PD No. 1638, which provides that the name of a retiree who loses his Filipino citizenship shall be removed from the
25
retired list and his retirement benefits terminated upon such loss, was correctly made applicable to Jeremias' retirement benefits. Logic dictates that since
Jeremias had already renounced his allegiance to the Philippines, he cannot now be compelled by the State to render active service and to render compulsory
military service when the need arises. The CA found that for the writ of mandamus to lie, it is essential that Jeremias should have a clear legal right to the
thing demanded and it must be the imperative duty of respondents to perform the act required which petitioner failed to show; thus, mandamus will not lie.
Petitioner's motion for reconsideration was denied in a Resolution dated September 10, 2009.
Hence, this petition raising the following:
RESPONDENT COURT OF APPEALS COMMITTED GRAVE REVERSIBLE ERROR IN RENDERING THE ASSAILED DECISION AND RESOLUTION
WHICH SET ASIDE AND REVERSED THE 26 FEBRUARY 2007 DECISION OF THE QC RTC BECAUSE:
PD 1638 should not have been applied and cannot be used against petitioner as her husband's retirement and pension were granted to him by the AFP under
RA 340 which was not superseded by PD 1638, a later statute.
Petitioner correctly availed of the remedy of mandamus to compel the reinstatement of his pension and benefits from the AFP under RA 340 as PD 1638 was
not applicable to him.
Petitioner contends that her husband's retirement from the active service in 1976 was pursuant to the provisions of RA No. No. 340 as PD No. 1638 was not
yet in existence then, and there was nothing in RA No. 340 that disqualifies a retired military personnel from receiving retirement benefits after acquiring
foreign citizenship. The concept of retirement benefits is such that one is entitled to them for services already rendered and not for those to be made at a
future time. Retirement benefits due petitioner's husband under RA No. 340, is an acquired right which cannot be taken away by a subsequent law. PD No.
1638 does not expressly provide for its retroactive application. Respondents, being officers of the AFP tasked to implement the provisions of RA No. 340 have
neglected their function thereunder by delisting petitioner's husband as a retiree, thus, mandamus is proper.
In his Comment, the Solicitor General argues that PD No. 1638 applies to all military personnel in the service of the AFP whether active or retired; hence, it
applies retroactively to petitioner's husband. Even when a retiree is no longer in the active service, his being a Filipino still makes him a part of the Citizen
Armed Forces; that whether a military personnel retires under the provisions of RA No. 340 or under PD No. 1638, he is still in the service of the military
and/or the State only that he is retired, thus, they should not be treated differently upon the loss of Filipino citizenship. He argues when there is an irreconcilable
conflict between the two laws of different vintages, i.e., RA No. 340 and PD No. 1638, the latter enactment prevails.
The Solicitor General argues that mandamus will not issue to enforce a right to compel compliance with a duty which is questionable or over which a substantial
doubt exists. In this case, petitioner's husband does not have a well-defined, clear and certain legal right to continuously receive retirement benefits after
becoming an American citizen. Likewise, the AFP does not have a clear and imperative duty to grant the said benefits considering that Section 27 of PD No.
1638 provides that the name of a retiree who loses his Filipino citizenship shall be removed from the retired list and his retirement benefits terminated upon
such loss.
Petitioner filed her reply thereto. We find merit in the petition.

Petitioner's husband retired in 1976 under RA No. 340. He was already receiving his monthly retirement benefit in the amount of P18,315.00 since December
1976 until it was terminated in March 2005. Section 5, RA No. 340 provides:
Sec. 5. Officers and enlisted men placed in the retired list shall be subject to the rules and articles of war and to trial by court-martial for any breach thereof.
At any time said officers and enlisted men may be called to active service by the President. Refusal on the part of any officer or enlisted man to perform such
26
services shall terminate his right to further participation in the benefits of this Act provided he resides in the Philippines and is physically fit for service. Such
fitness for service shall be determined by applicable regulations.
The afore-quoted provision clearly shows how a retiree's retirement benefits may be terminated, i.e., when the retiree refuses to perform active service when
called to do so provided that (1) the retiree resides in the Philippines and (2) is physically fit for service. There is no other requirement found in the law which
would be the reason for the termination of a retiree's retirement benefits. Petitioner's husband was never called to perform active service and refused to do
so, however, his retirement benefit was terminated. The reason for such termination was his loss of Filipino citizenship based on Section 27 of PD No. 1638,
to wit:
Section 27. Military personnel retired under Sections 4, 5, 10, 11 and 12 shall be carried in the retired list of the Armed Forces of the Philippines. The name
of a retiree who loses his Filipino citizenship shall be removed from the retired list and his retirement benefits terminated upon such loss.
We find that the CA erred in applying PD No. 1638 to the retirement benefits of petitioner's husband.
Firstly, PD No. 1638 was signed by then President Ferdinand Marcos on September 10, 1979. Under Article 4 of the Civil Code, it is provided that laws shall
have no retroactive effect, unless the contrary is provided. It is said that the law looks to the future only and has no retroactive effect unless the legislator may
have formally given that effect to some legal provisions;17 that all statutes are to be construed as having only prospective operation, unless the purpose and
intention of the legislature to give them a retrospective effect is expressly declared or is necessarily implied from the language used; and that every case of
doubt must be resolved against retrospective effect.18 These principles also apply to amendments of statutes.
PD No. 1638 does not contain any provision regarding its retroactive application, nor the same may be implied from its language. In fact, Section 36 of PD
No. 1638 clearly provides that the decree shall take effect upon its approval. As held in Parreno v. COA,19 there is no question that PD No. 1638, as amended,
applies prospectively. Since PD No. 1638, as amended, is about the new system of retirement and separation from service of military personnel, it should
apply to those who were in the service at the time of its approval.20 Conversely, PD No. 1638 is not applicable to those who retired before its effectivity in
1979. The rule is familiar that after an act is amended, the original act continues to be in force with regard to all rights that had accrued prior to such
amendment.21
Moreover, Section 27 of PD No. 1638 specifically provides for the retirees to whom the law shall be applied, to wit:
Section 27. Military personnel retired under Sections 4, 5, 10, 11 and 12 shall be carried in the retired list of the Armed Forces of the Philippines. The name
of a retiree who loses his Filipino citizenship shall be removed from the retired list and his retirement benefits terminated upon such loss, (emphasis supplied)
Notably, petitioner's husband did not retire under those above-enumerated Sections of PD No. 1638 as he retired under RA No. 340.
Secondly, it has been held that before a right to retirement benefits or pension vests in an employee, he must have met the stated conditions of eligibility with
respect to the nature of employment, age, and length of service.22 Undeniably, petitioner's husband had complied with the conditions of eligibility to retirement
benefits as he was then receiving his retirement benefits on a monthly basis until it was terminated. Where the employee retires and meets the eligibility
requirements, he acquires a vested right to the benefits that is protected by the due process clause.23 It is only upon retirement that military personnel acquire
a vested right to retirement benefits.24 Retirees enjoy a protected property interest whenever they acquire a right to immediate payment under pre-existing
law.25
In Ayog v. Cusi,26 we expounded the nature of a vested right, thus:
27
"A right is vested when the right to enjoyment has become the property of some particular person or persons as a present interest" (16 C.J.S. 1173). It is "the
privilege to enjoy property legally vested, to enforce contracts, and enjoy the rights of property conferred by the existing law" (12 C.J.S. 955, Note 46, No. 6)
or "some right or interest in property which has become fixed and established and is no longer open to doubt or controversy" (Downs vs. Blount 170 Fed. 15,
20, cited in Balboa vs. Farrales, 51 Phil. 498, 502).
The due process clause prohibits the annihilation of vested rights. "A state may not impair vested rights by legislative enactment, by the enactment or by the
subsequent repeal of a municipal ordinance, or by a change in the constitution of the State, except in a legitimate exercise of the police power" (16 C.J.S.
1177-78).
It has been observed that, generally, the term "vested right" expresses the concept of present fixed interest, which in right reason and natural justice should
be protected against arbitrary State action, or an innately just and imperative right which an enlightened free society, sensitive to inherent and irrefragable
individual rights, cannot deny (16 C.J.S. 1174, Note 71, No. 5, citing Pennsylvania Greyhound Lines, Inc. vs. Rosenthal, 192 Atl. 2nd 587).27cralawlawlibrary
Petitioner's husband acquired vested right to the payment of his retirement benefits which must be respected and cannot be affected by the subsequent
enactment of PD No. 1638 which provides that loss of Filipino citizenship terminates retirement benefits. Vested rights include not only legal or equitable title
to the enforcement of a demand, but also an exemption from new obligations after the right has vested.28
In fact, Sections 33 and 35 of PD No. 1638 recognize such vested right, to wit:
Section 33. Nothing in this Decree shall be construed in any manner to reduce whatever retirement and separation pay or gratuity or other monetary benefits
which any person is heretofore receiving or is entitled to receive under the provisions of existing law.
xxxx
Section. 35. Except those necessary to give effect to the provisions of this Decree and to preserve the rights granted to retired or separated military personnel,
all laws, rules and regulations inconsistent with the provisions of this Decree are hereby repealed or modified accordingly.
Section 33 of PD No. 1638 is clear that the law has no intention to reduce or to revoke whatever retirement benefits being enjoyed by a retiree at the time of
its passage. Hence, Section 35 provides for an exception to what the decree repealed or modified, i.e., except those necessary to preserve the rights granted
to retired or separated military personnel.
We also find that the CA erred in finding that mandamus will not lie.
Section 3, Rule 65 of the Rules of Court lay down under what circumstances petition for mandamus may be filed, to wit:
SEC. 3. Petition for mandamus. - When any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law
specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to which
such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified
petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent, immediately or at some other
time to be specified by the court, to do the act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner
by reason of the wrongful acts of the respondent.
A writ of mandamus can be issued only when petitioner's legal right to the performance of a particular act which is sought to be compelled is clear and
complete. A clear legal right is a right which is indubitably granted by law or is inferable as a matter of law.29 A doctrine well-embedded in our jurisprudence
28
is that mandamus will issue only when the petitioner has a clear legal right to the performance of the act sought to be compelled and the respondent has an
imperative duty to perform the same.30 The remedy of mandamus lies to compel the performance of a ministerial duty.31 A purely ministerial act or duty is
one that an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to or
the exercise of its own judgment upon the propriety or impropriety of the act done.32 If the law imposes a duty upon a public officer, and gives him the right
to decide how or when the duty shall be performed, such duty is discretionary and not ministerial.33
The petition for mandamus filed by petitioner's husband with the RTC was for the payment of his terminated retirement benefits, which has become vested,
and being a ministerial duty on the part of the respondents to pay such claim, mandamus is the proper remedy to compel such payment.
The doctrine of exhaustion of administrative remedies calls for resort first to the appropriate administrative authorities in the resolution of a controversy falling
under their jurisdiction before the same may be elevated to the courts of justice for review.34 However, the principle of exhaustion of administrative remedies
need not be adhered to when the question is purely legal.35 This is because issues of law cannot be resolved with finality by the administrative officer.36
Appeal to the administrative officer would only be an exercise in futility.37 Here, the question raised is purely legal, i.e., what law should be applied in the
payment of retirement benefits of petitioner's husband. Thus, there was no need to exhaust all administrative remedies before a judicial relief can be
sought.cralawred
WHEREFORE, the petition is GRANTED. The Decision dated May 25, 2009 and the Resolution dated September 10, 2009 of the Court of Appeals are hereby
REVERSED and SET ASIDE. The Decision dated February 26, 2007 of the Regional Trial Court of Quezon City, Branch 220, is AFFIRMED.
SO ORDERED.
FAMANILA VS CA 2006
Before us is a petition for review on certiorari assailing the Decision 1 of the Court of Appeals in CA-G.R. SP No. 50615 dated March 30, 2001 which affirmed
the Decision 2 of the National Labor Relations Commission (NLRC) dated March 31, 1998 dismissing petitioners complaint for payment of disability and other
benefits for lack of merit and the Resolution 3 dated October 5, 2001 of the Court of Appeals denying petitioners motion for reconsideration.
The antecedent facts are as follows:
In 1989, respondent NFD International Manning Agents, Inc. hired the services of petitioner Roberto G. Famanila as Messman 4 for Hansa Riga, a vessel
registered and owned by its principal and co-respondent, Barbership Management Limited.
On June 21, 1990, while Hansa Riga was docked at the port of Eureka, California, U.S.A. and while petitioner was assisting in the loading operations, the
latter complained of a headache. Petitioner experienced dizziness and he subsequently collapsed. Upon examination, it was determined that he had a sudden
attack of left cerebral hemorrhage from a ruptured cerebral aneurysm. 5 Petitioner underwent a brain operation and he was confined at the Emmanuel Hospital
in Portland, Oregon, U.S.A. On July 19, 1990, he underwent a second brain operation.
29
Owing to petitioners physical and mental condition, he was repatriated to the Philippines. On August 21, 1990, he was examined at the American Hospital in
Intramuros, Manila where the examining physician, Dr. Patricia Abesamis declared that he "cannot go back to sea duty and has been observed for 120 days,
he is being declared permanently, totally disabled." 6
Thereafter, authorized representatives of the respondents convinced him to settle his claim amicably by accepting the amount of US$13,200. 7 Petitioner
accepted the offer as evidenced by his signature in the Receipt and Release dated February 28, 1991. 8 His wife, Gloria Famanila and one Richard Famanila,
acted as witnesses in the signing of the release.
On June 11, 1997, petitioner filed a complaint 9 with the NLRC which was docketed as NLRC OCW Case No. 6-838-97-L praying for an award of disability
benefits, share in the insurance proceeds, moral damages and attorneys fees. On September 29, 1997, Acting Executive Labor Arbiter Voltaire A. Balitaan
dismissed the complaint on the ground of prescription. Petitioner appealed the decision with the NLRC. On March 31, 1998, the NLRC promulgated its decision
10 finding the appeal to be without merit and ordered its dismissal. When the motion for reconsideration 11 was denied by the NLRC in its resolution dated
June 29, 1998, 12 petitioner filed a petition for certiorari with this Court. On December 2, 1998, we resolved to refer the case to the Court of Appeals pursuant
to our ruling in St. Martin Funeral Home v. National Labor Relations Commission. 13
On March 30, 2001, the Court of Appeals promulgated the assailed decision which dismissed the petition for lack of merit. Petitioners motion for
reconsideration was denied, hence, the present petition for review raising the following issues:
I. THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN UPHOLDING
THE VALIDITY OF THE RECEIPT AND RELEASE SINCE PETITIONERS CONSENT THERETO WAS VITIATED THEREBY MAKING THE SAME VOID
AND UNENFORCEABLE.
II. THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN HOLDING
THAT THE PRESCRIPTION PERIOD APPLICABLE TO THE CLAIM OF THE PETITIONER IS THE 3-YEAR PERIOD PROVIDED FOR UNDER THE LABOR
CODE OF THE PHILIPPINES AND NOT THE 10-YEAR PERIOD PROVIDED FOR UNDER THE CIVIL CODE.
Petitioner claims that he did not sign the Receipt and Release voluntarily or freely because he was permanently disabled and in financial constraints. These
factors allegedly vitiated his consent which makes the Receipt and Release void and unenforceable.
The petition lacks merit.
It is fundamental that the scope of the Supreme Courts judicial review under Rule 45 of the Rules of Court is confined only to errors of law. It does not extend
to questions of fact. More so in labor cases where the doctrine applies with greater force. 14 The Labor Arbiter and the NLRC have already determined the
factual issues, and these were affirmed by the Court of Appeals. Thus, they are accorded not only great respect but also finality and are deemed binding upon
this Court so long as they are supported by substantial evidence. 15 We reviewed the records of the case and we find no reason to deviate from the findings
of the labor arbiter, NLRC and the Court of Appeals.
30
A vitiated consent does not make a contract void and unenforceable. A vitiated consent only gives rise to a voidable agreement. Under the Civil Code, the
vices of consent are mistake, violence, intimidation, undue influence or fraud. 16 If consent is given through any of the aforementioned vices of consent, the
contract is voidable. 17 A voidable contract is binding unless annulled by a proper action in court. 18
Petitioner contends that his permanent and total disability vitiated his consent to the Receipt and Release thereby rendering it void and unenforceable.
However, disability is not among the factors that may vitiate consent. Besides, save for petitioners self-serving allegations, there is no proof on record that
his consent was vitiated on account of his disability. In the absence of such proof of vitiated consent, the validity of the Receipt and Release must be upheld.
We agree with the findings of the Court of Appeals that:
In the case at bar, there is nothing in the records to show that petitioners consent was vitiated when he signed the agreement. Granting that petitioner has
not fully recovered his health at the time he signed the subject document, the same cannot still lead to the conclusion that he did not voluntar[il]y accept the
agreement, for his wife and another relative witnessed his signing.
Moreover, the document entitled receipt and release which was attached by petitioner in his appeal does not show on its face any violation of law or public
policy. In fact, petitioner did not present any proof to show that the consideration for the same is not reasonable and acceptable. Absent any evidence to
support the same, the Court cannot, on its own accord, decide against the unreasonableness of the consideration. 19
It is true that quitclaims and waivers are oftentimes frowned upon and are considered as ineffective in barring recovery for the full measure of the workers
right and that acceptance of the benefits therefrom does not amount to estoppel. 20 The reason is plain. Employer and employee, obviously do not stand on
the same footing. 21 However, not all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represents
a reasonable settlement, it is binding on the parties and may not later be disowned simply because of change of mind. It is only where there is clear proof that
the waiver was wangled from an unsuspecting or gullible person, or the terms of the settlement are unconscionable on its face, that the law will step in to
annul the questionable transaction. But where it is shown that the person making the waiver did so voluntarily, with full understanding of what he was doing,
and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding undertaking, 22 as in this case.
To be valid and effective, waivers must be couched in clear and unequivocal terms, leaving no doubt as to the intention of those giving up a right or a benefit
that legally pertains to them. 23 We have reviewed the terms and conditions contained in the Receipt and Release and we find the same to be clear and
unambiguous. The signing was even witnessed by petitioners wife, Gloria T. Famanila and one Richard T. Famanila. The Receipt and Release provides in
part:
That for and in consideration of the sum of THIRTEEN THOUSAND TWO HUNDRED DOLLARS (US$13,200.00) or its equivalent in Philippine currency
THREE HUNDRED SIXTY FIVE THOUSAND NINE HUNDRED FOUR PESOS (365,904.00), the receipt of which is hereby acknowledged to my full and
complete satisfaction x x x I, ROBERTO G. FAMANILA, x x x hereby remise, release and forever discharge said vessel "HANSA RIGA", her Owners, operators,
managers, charterers, agents, underwriters, P and I Club, master, officers, and crew and all parties at interest therein or thereon, whether named or not
named, including but not limited to BARBER SHIP MANAGEMENT LIMITED, NFD INTERNATIONAL MANNING AGENTS, INC. and
ASSURANCEFORENIGEN GARD from any and all claims, demands, debts, dues, liens, actions or causes of action, at law or in equity, in common law or in
admiralty, statutory or contractual, arising from and under the laws of the United States of America, Norway, Hongkong or the Republic of the Philippines
and/or any other foreign country now held, owned or possessed by me or by any person or persons, arising from or related to or concerning whether directly
31
or indirectly, proximately or remotely, without being limited to but including the said illness suffered by me on board the vessel "HANSA RIGA" on or about
21st June 1990 at Portland, Oregon and disability compensation in connection therewith.
This instrument is a GENERAL RELEASE intended to release all liabilities of any character and/or claims or damages and/or losses and/or any other liabilities
whatsoever, whether contractual or statutory, at common law or in equity, tortious or in admiralty, now or henceforth in any way related to or occurring as a
consequence of the illness suffered by me as Messman of the vessel "HANSA RIGA", including but not limited to all damages and/or losses consisting of loss
of support, loss of earning capacity, loss of all benefits of whatsoever nature and extent incurred, physical pain and suffering and/or all damages and/or
indemnities claimable in law, tort, contract, common law, equity and/or admiralty by me or by any person or persons pursuant to the laws of the United States
of America, Norway, Hongkong or the Republic of the Philippines and of all other countries whatsoever.
I hereby certify that I am of legal age and that I fully understand this instrument which was read to me in the local dialect and I agree that this is a FULL AND
FINAL RELEASE AND DISCHARGE of all parties and things referred to herein, and I further agree that this release may be pleaded as an absolute and final
bar to any suit or suits or legal proceedings that may hereafter be prosecuted by me or by any one claiming by, through, or under me, against any of the
persons or things referred to or related herein, for any matter or thing referred to or related herein. 24
It is elementary that a contract is perfected by mere consent and from that moment the parties are bound not only to the fulfillment of what has been expressly
stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law. 25 Further, dire necessity is
not an acceptable ground for annulling the Receipt and Release since it has not been shown that petitioner was forced to sign it. 26
Regarding prescription, the applicable prescriptive period for the money claims against the respondents is the three year period pursuant to Article 291 of the
Labor Code which provides that:
ART. 291. Money Claims. All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three
(3) years from the time the cause of action accrued; otherwise they shall be forever barred.
xxxx
Since petitioners demand for an award of disability benefits is a money claim arising from his employment, Article 291 of the Labor Code applies. From the
time petitioner was declared permanently and totally disabled on August 21, 1990 which gave rise to his entitlement to disability benefits up to the time that
he filed the complaint on June 11, 1997, more than three years have elapsed thereby effectively barring his claim.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated March 30, 2001 in CA-G.R. SP No. 50615 which affirmed the Decision of
the National Labor Relations Commission dismissing petitioners complaint for disability and other benefits for lack of merit, and
the Resolution dated October 5, 2001 denying the motion for reconsideration, are AFFIRMED.
SO ORDERED.
GUY VS CA 2006
32
This petition for review on certiorari assails the January 22, 2004 Decision1 of the Court of Appeals in CA-G.R. SP No. 79742, which affirmed the Orders
dated July 21, 20002 and July 17, 20033 of the Regional Trial Court of Makati City, Branch 138 in SP Proc. Case No. 4549 denying petitioner's motion to
dismiss; and its May 25, 2004 Resolution4 denying petitioner's motion for reconsideration.
The facts are as follows:
On June 13, 1997, private respondent-minors Karen Oanes Wei and Kamille Oanes Wei, represented by their mother Remedios Oanes (Remedios), filed a
petition for letters of administration5 before the Regional Trial Court of Makati City, Branch 138. The case was docketed as Sp. Proc. No. 4549 and entitled
Intestate Estate of Sima Wei (a.k.a. Rufino Guy Susim).
Private respondents alleged that they are the duly acknowledged illegitimate children of Sima Wei, who died intestate in Makati City on October 29, 1992,
leaving an estate valued at P10,000,000.00 consisting of real and personal properties. His known heirs are his surviving spouse Shirley Guy and children,
Emy, Jeanne, Cristina, George and Michael, all surnamed Guy. Private respondents prayed for the appointment of a regular administrator for the orderly
settlement of Sima Wei's estate. They likewise prayed that, in the meantime, petitioner Michael C. Guy, son of the decedent, be appointed as Special
Administrator of the estate. Attached to private respondents' petition was a Certification Against Forum Shopping6 signed by their counsel, Atty. Sedfrey A.
Ordoez.
In his Comment/Opposition,7 petitioner prayed for the dismissal of the petition. He asserted that his deceased father left no debts and that his estate can be
settled without securing letters of administration pursuant to Section 1, Rule 74 of the Rules of Court. He further argued that private respondents should have
established their status as illegitimate children during the lifetime of Sima Wei pursuant to Article 175 of the Family Code.
The other heirs of Sima Wei filed a Joint Motion to Dismiss8 on the ground that the certification against forum shopping should have been signed by private
respondents and not their counsel. They contended that Remedios should have executed the certification on behalf of her minor daughters as mandated by
Section 5, Rule 7 of the Rules of Court.
In a Manifestation/Motion as Supplement to the Joint Motion to Dismiss,9 petitioner and his co-heirs alleged that private respondents' claim had been paid,
waived, abandoned or otherwise extinguished by reason of Remedios' June 7, 1993 Release and Waiver of Claim stating that in exchange for the financial
and educational assistance received from petitioner, Remedios and her minor children discharge the estate of Sima Wei from any and all liabilities.
The Regional Trial Court denied the Joint Motion to Dismiss as well as the Supplemental Motion to Dismiss. It ruled that while the Release and Waiver of
Claim was signed by Remedios, it had not been established that she was the duly constituted guardian of her minor daughters. Thus, no renunciation of right
occurred. Applying a liberal application of the rules, the trial court also rejected petitioner's objections on the certification against forum shopping.
Petitioner moved for reconsideration but was denied. He filed a petition for certiorari before the Court of Appeals which affirmed the orders of the Regional
Trial Court in its assailed Decision dated January 22, 2004, the dispositive portion of which states:
WHEREFORE, premises considered, the present petition is hereby DENIED DUE COURSE and accordingly DISMISSED, for lack of merit. Consequently,
the assailed Orders dated July 21, 2000 and July 17, 2003 are hereby both AFFIRMED. Respondent Judge is hereby DIRECTED to resolve the controversy
33
over the illegitimate filiation of the private respondents (sic) minors [-] Karen Oanes Wei and Kamille Oanes Wei who are claiming successional rights in the
intestate estate of the deceased Sima Wei, a.k.a. Rufino Guy Susim.
SO ORDERED.10
The Court of Appeals denied petitioner's motion for reconsideration, hence, this petition.
Petitioner argues that the Court of Appeals disregarded existing rules on certification against forum shopping; that the Release and Waiver of Claim executed
by Remedios released and discharged the Guy family and the estate of Sima Wei from any claims or liabilities; and that private respondents do not have the
legal personality to institute the petition for letters of administration as they failed to prove their filiation during the lifetime of Sima Wei in accordance with
Article 175 of the Family Code.
Private respondents contend that their counsel's certification can be considered substantial compliance with the rules on certification of non-forum shopping,
and that the petition raises no new issues to warrant the reversal of the decisions of the Regional Trial Court and the Court of Appeals.
The issues for resolution are: 1) whether private respondents' petition should be dismissed for failure to comply with the rules on certification of non-forum
shopping; 2) whether the Release and Waiver of Claim precludes private respondents from claiming their successional rights; and 3) whether private
respondents are barred by prescription from proving their filiation.
Rule 7, Section 5 of the Rules of Court provides that the certification of non-forum shopping should be executed by the plaintiff or the principal party. Failure
to comply with the requirement shall be cause for dismissal of the case. However, a liberal application of the rules is proper where the higher interest of justice
would be served. In Sy Chin v. Court of Appeals,11 we ruled that while a petition may have been flawed where the certificate of non-forum shopping was
signed only by counsel and not by the party, this procedural lapse may be overlooked in the interest of substantial justice.12 So it is in the present controversy
where the merits13 of the case and the absence of an intention to violate the rules with impunity should be considered as compelling reasons to temper the
strict application of the rules.
As regards Remedios' Release and Waiver of Claim, the same does not bar private respondents from claiming successional rights. To be valid and effective,
a waiver must be couched in clear and unequivocal terms which leave no doubt as to the intention of a party to give up a right or benefit which legally pertains
to him. A waiver may not be attributed to a person when its terms do not explicitly and clearly evince an intent to abandon a right.14
In this case, we find that there was no waiver of hereditary rights. The Release and Waiver of Claim does not state with clarity the purpose of its execution. It
merely states that Remedios received P300,000.00 and an educational plan for her minor daughters "by way of financial assistance and in full settlement of
any and all claims of whatsoever nature and kind x x x against the estate of the late Rufino Guy Susim."15 Considering that the document did not specifically
mention private respondents' hereditary share in the estate of Sima Wei, it cannot be construed as a waiver of successional rights.
Moreover, even assuming that Remedios truly waived the hereditary rights of private respondents, such waiver will not bar the latter's claim. Article 1044 of
the Civil Code, provides:
34
ART. 1044. Any person having the free disposal of his property may accept or repudiate an inheritance.
Any inheritance left to minors or incapacitated persons may be accepted by their parents or guardians. Parents or guardians may repudiate the inheritance
left to their wards only by judicial authorization.
The right to accept an inheritance left to the poor shall belong to the persons designated by the testator to determine the beneficiaries and distribute the
property, or in their default, to those mentioned in Article 1030. (Emphasis supplied)
Parents and guardians may not therefore repudiate the inheritance of their wards without judicial approval. This is because repudiation amounts to an
alienation of property16 which must pass the court's scrutiny in order to protect the interest of the ward. Not having been judicially authorized, the Release
and Waiver of Claim in the instant case is void and will not bar private respondents from asserting their rights as heirs of the deceased.
Furthermore, it must be emphasized that waiver is the intentional relinquishment of a known right. Where one lacks knowledge of a right, there is no basis
upon which waiver of it can rest. Ignorance of a material fact negates waiver, and waiver cannot be established by a consent given under a mistake or
misapprehension of fact.17
In the present case, private respondents could not have possibly waived their successional rights because they are yet to prove their status as acknowledged
illegitimate children of the deceased. Petitioner himself has consistently denied that private respondents are his co-heirs. It would thus be inconsistent to rule
that they waived their hereditary rights when petitioner claims that they do not have such right. Hence, petitioner's invocation of waiver on the part of private
respondents must fail.
Anent the issue on private respondents' filiation, we agree with the Court of Appeals that a ruling on the same would be premature considering that private
respondents have yet to present evidence. Before the Family Code took effect, the governing law on actions for recognition of illegitimate children was Article
285 of the Civil Code, to wit:
ART. 285. The action for the recognition of natural children may be brought only during the lifetime of the presumed parents, except in the following cases:
(1) If the father or mother died during the minority of the child, in which case the latter may file the action before the expiration of four years from the attainment
of his majority;
(2) If after the death of the father or of the mother a document should appear of which nothing had been heard and in which either or both parents recognize
the child.
In this case, the action must be commenced within four years from the finding of the document. (Emphasis supplied)
We ruled in Bernabe v. Alejo18 that illegitimate children who were still minors at the time the Family Code took effect and whose putative parent died during
their minority are given the right to seek recognition for a period of up to four years from attaining majority age. This vested right was not impaired or taken
away by the passage of the Family Code.19
35
On the other hand, Articles 172, 173 and 175 of the Family Code, which superseded Article 285 of the Civil Code, provide:
ART. 172. The filiation of legitimate children is established by any of the following:
(1) The record of birth appearing in the civil register or a final judgment; or
(2) An admission of legitimate filiation in a public document or a private handwritten instrument and signed by the parent concerned.
In the absence of the foregoing evidence, the legitimate filiation shall be proved by:
(1) The open and continuous possession of the status of a legitimate child; or
(2) Any other means allowed by the Rules of Court and special laws.
ART. 173. The action to claim legitimacy may be brought by the child during his or her lifetime and shall be transmitted to the heirs should the child die during
minority or in a state of insanity. In these cases, the heirs shall have a period of five years within which to institute the action.
The action already commenced by the child shall survive notwithstanding the death of either or both of the parties.
ART. 175. Illegitimate children may establish their illegitimate filiation in the same way and on the same, evidence as legitimate children.
The action must be brought within the same period specified in Article 173, except when the action is based on the second paragraph of Article 172, in which
case the action may be brought during the lifetime of the alleged parent.
Under the Family Code, when filiation of an illegitimate child is established by a record of birth appearing in the civil register or a final judgment, or an admission
of filiation in a public document or a private handwritten instrument signed by the parent concerned, the action for recognition may be brought by the child
during his or her lifetime. However, if the action is based upon open and continuous possession of the status of an illegitimate child, or any other means
allowed by the rules or special laws, it may only be brought during the lifetime of the alleged parent.
It is clear therefore that the resolution of the issue of prescription depends on the type of evidence to be adduced by private respondents in proving their
filiation. However, it would be impossible to determine the same in this case as there has been no reception of evidence yet. This Court is not a trier of facts.
Such matters may be resolved only by the Regional Trial Court after a full-blown trial.
While the original action filed by private respondents was a petition for letters of administration, the trial court is not precluded from receiving evidence on
private respondents' filiation. Its jurisdiction extends to matters incidental and collateral to the exercise of its recognized powers in handling the settlement of
the estate, including the determination of the status of each heir.20 That the two causes of action, one to compel recognition and the other to claim inheritance,
may be joined in one complaint is not new in our jurisprudence.21 As held in Briz v. Briz:22
The question whether a person in the position of the present plaintiff can in any event maintain a complex action to compel recognition as a natural child and
at the same time to obtain ulterior relief in the character of heir, is one which in the opinion of this court must be answered in the affirmative, provided always
that the conditions justifying the joinder of the two distinct causes of action are present in the particular case. In other words, there is no absolute necessity
requiring that the action to compel acknowledgment should have been instituted and prosecuted to a successful conclusion prior to the action in which that
36
same plaintiff seeks additional relief in the character of heir. Certainly, there is nothing so peculiar to the action to compel acknowledgment as to require that
a rule should be here applied different from that generally applicable in other cases. x x x
The conclusion above stated, though not heretofore explicitly formulated by this court, is undoubtedly to some extent supported by our prior decisions. Thus,
we have held in numerous cases, and the doctrine must be considered well settled, that a natural child having a right to compel acknowledgment, but who
has not been in fact acknowledged, may maintain partition proceedings for the division of the inheritance against his coheirs (Siguiong vs. Siguiong, 8 Phil.,
5; Tiamson vs. Tiamson, 32 Phil., 62); and the same person may intervene in proceedings for the distribution of the estate of his deceased natural father, or
mother (Capistrano vs. Fabella, 8 Phil., 135; Conde vs. Abaya, 13 Phil., 249; Ramirez vs. Gmur, 42 Phil., 855). In neither of these situations has it been
thought necessary for the plaintiff to show a prior decree compelling acknowledgment. The obvious reason is that in partition suits and distribution proceedings
the other persons who might take by inheritance are before the court; and the declaration of heirship is appropriate to such proceedings.
WHEREFORE, the instant petition is DENIED. The Decision dated January 22, 2004 of the Court of Appeals in CA-G.R. SP No. 79742 affirming the denial of
petitioner's motion to dismiss; and its Resolution dated May 25, 2004 denying petitioner's motion for reconsideration, are AFFIRMED. Let the records be
REMANDED to the Regional Trial Court of Makati City, Branch 138 for further proceedings.
SO ORDERED.
SILVERIO VS REPUBLIC 2007
When God created man, He made him in the likeness of God; He created them male and female. (Genesis 5:1-2)
Amihan gazed upon the bamboo reed planted by Bathala and she heard voices coming from inside the bamboo. "Oh North Wind! North Wind! Please let us
out!," the voices said. She pecked the reed once, then twice. All of a sudden, the bamboo cracked and slit open. Out came two human beings; one was a
male and the other was a female. Amihan named the man "Malakas" (Strong) and the woman "Maganda" (Beautiful). (The Legend of Malakas and Maganda)
When is a man a man and when is a woman a woman? In particular, does the law recognize the changes made by a physician using scalpel, drugs and
counseling with regard to a persons sex? May a person successfully petition for a change of name and sex appearing in the birth certificate to reflect the
result of a sex reassignment surgery?
On November 26, 2002, petitioner Rommel Jacinto Dantes Silverio filed a petition for the change of his first name and sex in his birth certificate in the Regional
Trial Court of Manila, Branch 8. The petition, docketed as SP Case No. 02-105207, impleaded the civil registrar of Manila as respondent.
Petitioner alleged in his petition that he was born in the City of Manila to the spouses Melecio Petines Silverio and Anita Aquino Dantes on April 4, 1962. His
name was registered as "Rommel Jacinto Dantes Silverio" in his certificate of live birth (birth certificate). His sex was registered as "male."
He further alleged that he is a male transsexual, that is, "anatomically male but feels, thinks and acts as a female" and that he had always identified himself
with girls since childhood.1 Feeling trapped in a mans body, he consulted several doctors in the United States. He underwent psychological examination,
hormone treatment and breast augmentation. His attempts to transform himself to a "woman" culminated on January 27, 2001 when he underwent sex
37
reassignment surgery2 in Bangkok, Thailand. He was thereafter examined by Dr. Marcelino Reysio-Cruz, Jr., a plastic and reconstruction surgeon in the
Philippines, who issued a medical certificate attesting that he (petitioner) had in fact undergone the procedure.
From then on, petitioner lived as a female and was in fact engaged to be married. He then sought to have his name in his birth certificate changed from
"Rommel Jacinto" to "Mely," and his sex from "male" to "female."
An order setting the case for initial hearing was published in the Peoples Journal Tonight, a newspaper of general circulation in Metro Manila, for three
consecutive weeks.3 Copies of the order were sent to the Office of the Solicitor General (OSG) and the civil registrar of Manila.
On the scheduled initial hearing, jurisdictional requirements were established. No opposition to the petition was made.
During trial, petitioner testified for himself. He also presented Dr. Reysio-Cruz, Jr. and his American fianc, Richard P. Edel, as witnesses.
On June 4, 2003, the trial court rendered a decision4 in favor of petitioner. Its relevant portions read:
Petitioner filed the present petition not to evade any law or judgment or any infraction thereof or for any unlawful motive but solely for the purpose of making
his birth records compatible with his present sex.
The sole issue here is whether or not petitioner is entitled to the relief asked for.
The [c]ourt rules in the affirmative.
Firstly, the [c]ourt is of the opinion that granting the petition would be more in consonance with the principles of justice and equity. With his sexual [re-
assignment], petitioner, who has always felt, thought and acted like a woman, now possesses the physique of a female. Petitioners misfortune to be trapped
in a mans body is not his own doing and should not be in any way taken against him.
Likewise, the [c]ourt believes that no harm, injury [or] prejudice will be caused to anybody or the community in granting the petition. On the contrary, granting
the petition would bring the much-awaited happiness on the part of the petitioner and her [fianc] and the realization of their dreams.
Finally, no evidence was presented to show any cause or ground to deny the present petition despite due notice and publication thereof. Even the State,
through the [OSG] has not seen fit to interpose any [o]pposition.
WHEREFORE, judgment is hereby rendered GRANTING the petition and ordering the Civil Registrar of Manila to change the entries appearing in the
Certificate of Birth of [p]etitioner, specifically for petitioners first name from "Rommel Jacinto" to MELY and petitioners gender from "Male" to FEMALE. 5
On August 18, 2003, the Republic of the Philippines (Republic), thru the OSG, filed a petition for certiorari in the Court of Appeals.6 It alleged that there is no
law allowing the change of entries in the birth certificate by reason of sex alteration.
38
On February 23, 2006, the Court of Appeals7 rendered a decision8 in favor of the Republic. It ruled that the trial courts decision lacked legal basis. There is
no law allowing the change of either name or sex in the certificate of birth on the ground of sex reassignment through surgery. Thus, the Court of Appeals
granted the Republics petition, set aside the decision of the trial court and ordered the dismissal of SP Case No. 02-105207. Petitioner moved for
reconsideration but it was denied.9 Hence, this petition.
Petitioner essentially claims that the change of his name and sex in his birth certificate is allowed under Articles 407 to 413 of the Civil Code, Rules 103 and
108 of the Rules of Court and RA 9048.10
A Persons First Name Cannot Be Changed On the Ground of Sex Reassignment
Petitioner invoked his sex reassignment as the ground for his petition for change of name and sex. As found by the trial court:
Petitioner filed the present petition not to evade any law or judgment or any infraction thereof or for any unlawful motive but solely for the purpose of making
his birth records compatible with his present sex. (emphasis supplied)
Petitioner believes that after having acquired the physical features of a female, he became entitled to the civil registry changes sought. We disagree.
The State has an interest in the names borne by individuals and entities for purposes of identification.11 A change of name is a privilege, not a right.12
Petitions for change of name are controlled by statutes.13 In this connection, Article 376 of the Civil Code provides:
ART. 376. No person can change his name or surname without judicial authority.
This Civil Code provision was amended by RA 9048 (Clerical Error Law). In particular, Section 1 of RA 9048 provides:
SECTION 1. Authority to Correct Clerical or Typographical Error and Change of First Name or Nickname. No entry in a civil register shall be changed or
corrected without a judicial order, except for clerical or typographical errors and change of first name or nickname which can be corrected or changed by the
concerned city or municipal civil registrar or consul general in accordance with the provisions of this Act and its implementing rules and regulations.
RA 9048 now governs the change of first name.14 It vests the power and authority to entertain petitions for change of first name to the city or municipal civil
registrar or consul general concerned. Under the law, therefore, jurisdiction over applications for change of first name is now primarily lodged with the
aforementioned administrative officers. The intent and effect of the law is to exclude the change of first name from the coverage of Rules 103 (Change of
Name) and 108 (Cancellation or Correction of Entries in the Civil Registry) of the Rules of Court, until and unless an administrative petition for change of name
is first filed and subsequently denied.15 It likewise lays down the corresponding venue,16 form17 and procedure. In sum, the remedy and the proceedings
regulating change of first name are primarily administrative in nature, not judicial.
RA 9048 likewise provides the grounds for which change of first name may be allowed:
39
SECTION 4. Grounds for Change of First Name or Nickname. The petition for change of first name or nickname may be allowed in any of the following
cases:
(1) The petitioner finds the first name or nickname to be ridiculous, tainted with dishonor or extremely difficult to write or pronounce;
(2) The new first name or nickname has been habitually and continuously used by the petitioner and he has been publicly known by that first name or nickname
in the community; or
(3) The change will avoid confusion.
Petitioners basis in praying for the change of his first name was his sex reassignment. He intended to make his first name compatible with the sex he thought
he transformed himself into through surgery. However, a change of name does not alter ones legal capacity or civil status.18 RA 9048 does not sanction a
change of first name on the ground of sex reassignment. Rather than avoiding confusion, changing petitioners first name for his declared purpose may only
create grave complications in the civil registry and the public interest.
Before a person can legally change his given name, he must present proper or reasonable cause or any compelling reason justifying such change.19 In
addition, he must show that he will be prejudiced by the use of his true and official name.20 In this case, he failed to show, or even allege, any prejudice that
he might suffer as a result of using his true and official name.
In sum, the petition in the trial court in so far as it prayed for the change of petitioners first name was not within that courts primary jurisdiction as the petition
should have been filed with the local civil registrar concerned, assuming it could be legally done. It was an improper remedy because the proper remedy was
administrative, that is, that provided under RA 9048. It was also filed in the wrong venue as the proper venue was in the Office of the Civil Registrar of Manila
where his birth certificate is kept. More importantly, it had no merit since the use of his true and official name does not prejudice him at all. For all these
reasons, the Court of Appeals correctly dismissed petitioners petition in so far as the change of his first name was concerned.
No Law Allows The Change of Entry In The Birth Certificate As To Sex On the Ground of Sex Reassignment
The determination of a persons sex appearing in his birth certificate is a legal issue and the court must look to the statutes.21 In this connection, Article 412
of the Civil Code provides:
ART. 412. No entry in the civil register shall be changed or corrected without a judicial order.
Together with Article 376 of the Civil Code, this provision was amended by RA 9048 in so far as clerical or typographical errors are involved. The correction
or change of such matters can now be made through administrative proceedings and without the need for a judicial order. In effect, RA 9048 removed from
the ambit of Rule 108 of the Rules of Court the correction of such errors.22 Rule 108 now applies only to substantial changes and corrections in entries in the
civil register.23
Section 2(c) of RA 9048 defines what a "clerical or typographical error" is:
SECTION 2. Definition of Terms. As used in this Act, the following terms shall mean:
40
xxx xxx xxx

(3) "Clerical or typographical error" refers to a mistake committed in the performance of clerical work in writing, copying, transcribing or typing an entry in the
civil register that is harmless and innocuous, such as misspelled name or misspelled place of birth or the like, which is visible to the eyes or obvious to the
understanding, and can be corrected or changed only by reference to other existing record or records: Provided, however, That no correction must involve
the change of nationality, age, status or sex of the petitioner. (emphasis supplied)
Under RA 9048, a correction in the civil registry involving the change of sex is not a mere clerical or typographical error. It is a substantial change for which
the applicable procedure is Rule 108 of the Rules of Court.
The entries envisaged in Article 412 of the Civil Code and correctable under Rule 108 of the Rules of Court are those provided in Articles 407 and 408 of the
Civil Code:24
ART. 407. Acts, events and judicial decrees concerning the civil status of persons shall be recorded in the civil register.
ART. 408. The following shall be entered in the civil register:
(1) Births; (2) marriages; (3) deaths; (4) legal separations; (5) annulments of marriage; (6) judgments declaring marriages void from the beginning; (7)
legitimations; (8) adoptions; (9) acknowledgments of natural children; (10) naturalization; (11) loss, or (12) recovery of citizenship; (13) civil interdiction; (14)
judicial determination of filiation; (15) voluntary emancipation of a minor; and (16) changes of name.
The acts, events or factual errors contemplated under Article 407 of the Civil Code include even those that occur after birth.25 However, no reasonable
interpretation of the provision can justify the conclusion that it covers the correction on the ground of sex reassignment.
To correct simply means "to make or set aright; to remove the faults or error from" while to change means "to replace something with something else of the
same kind or with something that serves as a substitute."26 The birth certificate of petitioner contained no error. All entries therein, including those
corresponding to his first name and sex, were all correct. No correction is necessary.
Article 407 of the Civil Code authorizes the entry in the civil registry of certain acts (such as legitimations, acknowledgments of illegitimate children and
naturalization), events (such as births, marriages, naturalization and deaths) and judicial decrees (such as legal separations, annulments of marriage,
declarations of nullity of marriages, adoptions, naturalization, loss or recovery of citizenship, civil interdiction, judicial determination of filiation and changes of
name). These acts, events and judicial decrees produce legal consequences that touch upon the legal capacity, status and nationality of a person. Their
effects are expressly sanctioned by the laws. In contrast, sex reassignment is not among those acts or events mentioned in Article 407. Neither is it recognized
nor even mentioned by any law, expressly or impliedly.
"Status" refers to the circumstances affecting the legal situation (that is, the sum total of capacities and incapacities) of a person in view of his age, nationality
and his family membership.27
41
The status of a person in law includes all his personal qualities and relations, more or less permanent in nature, not ordinarily terminable at his own will, such
as his being legitimate or illegitimate, or his being married or not. The comprehensive term status include such matters as the beginning and end of legal
personality, capacity to have rights in general, family relations, and its various aspects, such as birth, legitimation, adoption, emancipation, marriage, divorce,
and sometimes even succession.28 (emphasis supplied)
A persons sex is an essential factor in marriage and family relations. It is a part of a persons legal capacity and civil status. In this connection, Article 413 of
the Civil Code provides:
ART. 413. All other matters pertaining to the registration of civil status shall be governed by special laws.
But there is no such special law in the Philippines governing sex reassignment and its effects. This is fatal to petitioners cause.
Moreover, Section 5 of Act 3753 (the Civil Register Law) provides:
SEC. 5. Registration and certification of births. The declaration of the physician or midwife in attendance at the birth or, in default thereof, the declaration of
either parent of the newborn child, shall be sufficient for the registration of a birth in the civil register. Such declaration shall be exempt from documentary
stamp tax and shall be sent to the local civil registrar not later than thirty days after the birth, by the physician or midwife in attendance at the birth or by either
parent of the newborn child.
In such declaration, the person above mentioned shall certify to the following facts: (a) date and hour of birth; (b) sex and nationality of infant; (c) names,
citizenship and religion of parents or, in case the father is not known, of the mother alone; (d) civil status of parents; (e) place where the infant was born; and
(f) such other data as may be required in the regulations to be issued.
xxx xxx xxx

Under the Civil Register Law, a birth certificate is a historical record of the facts as they existed at the time of birth.29 Thus, the sex of a person is determined
at birth, visually done by the birth attendant (the physician or midwife) by examining the genitals of the infant. Considering that there is no law legally
recognizing sex reassignment, the determination of a persons sex made at the time of his or her birth, if not attended by error,30 is immutable.31
When words are not defined in a statute they are to be given their common and ordinary meaning in the absence of a contrary legislative intent. The words
"sex," "male" and "female" as used in the Civil Register Law and laws concerning the civil registry (and even all other laws) should therefore be understood
in their common and ordinary usage, there being no legislative intent to the contrary. In this connection, sex is defined as "the sum of peculiarities of structure
and function that distinguish a male from a female"32 or "the distinction between male and female."33 Female is "the sex that produces ova or bears young"34
and male is "the sex that has organs to produce spermatozoa for fertilizing ova."35 Thus, the words "male" and "female" in everyday understanding do not
include persons who have undergone sex reassignment. Furthermore, "words that are employed in a statute which had at the time a well-known meaning are
presumed to have been used in that sense unless the context compels to the contrary."36 Since the statutory language of the Civil Register Law was enacted
in the early 1900s and remains unchanged, it cannot be argued that the term "sex" as used then is something alterable through surgery or something that
allows a post-operative male-to-female transsexual to be included in the category "female."
42
For these reasons, while petitioner may have succeeded in altering his body and appearance through the intervention of modern surgery, no law authorizes
the change of entry as to sex in the civil registry for that reason. Thus, there is no legal basis for his petition for the correction or change of the entries in his
birth certificate.
Neither May Entries in the Birth Certificate As to First Name or Sex Be Changed on the Ground of Equity
The trial court opined that its grant of the petition was in consonance with the principles of justice and equity. It believed that allowing the petition would cause
no harm, injury or prejudice to anyone. This is wrong.
The changes sought by petitioner will have serious and wide-ranging legal and public policy consequences. First, even the trial court itself found that the
petition was but petitioners first step towards his eventual marriage to his male fianc. However, marriage, one of the most sacred social institutions, is a
special contract of permanent union between a man and a woman.37 One of its essential requisites is the legal capacity of the contracting parties who must
be a male and a female.38 To grant the changes sought by petitioner will substantially reconfigure and greatly alter the laws on marriage and family relations.
It will allow the union of a man with another man who has undergone sex reassignment (a male-to-female post-operative transsexual). Second, there are
various laws which apply particularly to women such as the provisions of the Labor Code on employment of women,39 certain felonies under the Revised
Penal Code40 and the presumption of survivorship in case of calamities under Rule 131 of the Rules of Court,41 among others. These laws underscore the
public policy in relation to women which could be substantially affected if petitioners petition were to be granted.
It is true that Article 9 of the Civil Code mandates that "[n]o judge or court shall decline to render judgment by reason of the silence, obscurity or insufficiency
of the law." However, it is not a license for courts to engage in judicial legislation. The duty of the courts is to apply or interpret the law, not to make or amend
it.
In our system of government, it is for the legislature, should it choose to do so, to determine what guidelines should govern the recognition of the effects of
sex reassignment. The need for legislative guidelines becomes particularly important in this case where the claims asserted are statute-based.
To reiterate, the statutes define who may file petitions for change of first name and for correction or change of entries in the civil registry, where they may be
filed, what grounds may be invoked, what proof must be presented and what procedures shall be observed. If the legislature intends to confer on a person
who has undergone sex reassignment the privilege to change his name and sex to conform with his reassigned sex, it has to enact legislation laying down
the guidelines in turn governing the conferment of that privilege.
It might be theoretically possible for this Court to write a protocol on when a person may be recognized as having successfully changed his sex. However,
this Court has no authority to fashion a law on that matter, or on anything else. The Court cannot enact a law where no law exists. It can only apply or interpret
the written word of its co-equal branch of government, Congress.
Petitioner pleads that "[t]he unfortunates are also entitled to a life of happiness, contentment and [the] realization of their dreams." No argument about that.
The Court recognizes that there are people whose preferences and orientation do not fit neatly into the commonly recognized parameters of social convention
and that, at least for them, life is indeed an ordeal. However, the remedies petitioner seeks involve questions of public policy to be addressed solely by the
legislature, not by the courts.
43
WHEREFORE, the petition is hereby DENIED.
Costs against petitioner.
SO ORDERED.
DEL SOCORRO VS VAN WILSEM 2014
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Orders1 dated February 19,
2010 and September 1, 2010, respectively, of the Regional Trial Court of Cebu City (RTC-Cebu), which dismissed the criminal case entitled People of the
Philippines v. Ernst Johan Brinkman Van Wilsem, docketed as Criminal Case No. CBU-85503, for violation of Republic Act (R.A.) No. 9262, otherwise known
as the Anti-Violence Against Women and Their Children Act of 2004.
The following facts are culled from the records:
Petitioner Norma A. Del Socorro and respondent Ernst Johan Brinkman Van Wilsem contracted marriage in Holland on September 25, 1990.2 On January
19, 1994, they were blessed with a son named Roderigo Norjo Van Wilsem, who at the time of the filing of the instant petition was sixteen (16) years of age.3
Unfortunately, their marriage bond ended on July 19, 1995 by virtue of a Divorce Decree issued by the appropriate Court of Holland.4 At that time, their son
was only eighteen (18) months old.5 Thereafter, petitioner and her son came home to the Philippines.6
According to petitioner, respondent made a promise to provide monthly support to their son in the amount of Two Hundred Fifty (250) Guildene (which is
equivalent to Php17,500.00 more or less).7 However, since the arrival of petitioner and her son in the Philippines, respondent never gave support to the son,
Roderigo.8
Not long thereafter, respondent cameto the Philippines and remarried in Pinamungahan, Cebu, and since then, have been residing thereat.9 Respondent and
his new wife established a business known as Paree Catering, located at Barangay Tajao, Municipality of Pinamungahan, Cebu City.10 To date, all the
parties, including their son, Roderigo, are presently living in Cebu City.11
On August 28, 2009, petitioner, through her counsel, sent a letter demanding for support from respondent. However, respondent refused to receive the
letter.12
Because of the foregoing circumstances, petitioner filed a complaint affidavit with the Provincial Prosecutor of Cebu City against respondent for violation of
Section 5, paragraph E(2) of R.A. No. 9262 for the latters unjust refusal to support his minor child with petitioner.13 Respondent submitted his counter-affidavit
thereto, to which petitioner also submitted her reply-affidavit.14 Thereafter, the Provincial Prosecutor of Cebu City issued a Resolution recommending the
filing of an information for the crime charged against herein respondent.
The information, which was filed with the RTC-Cebu and raffled to Branch 20 thereof, states that:
44
That sometime in the year 1995 and up to the present, more or less, in the Municipality of Minglanilla, Province of Cebu, Philippines, and within the jurisdiction
of this Honorable Court, the above-named accused, did then and there wilfully, unlawfully and deliberately deprive, refuse and still continue to deprive his son
RODERIGO NORJO VAN WILSEM, a fourteen (14) year old minor, of financial support legally due him, resulting in economic abuse to the victim. CONTRARY
TO LAW.15
Upon motion and after notice and hearing, the RTC-Cebu issued a Hold Departure Order against respondent.16 Consequently, respondent was arrested and,
subsequently, posted bail.17 Petitioner also filed a Motion/Application of Permanent Protection Order to which respondent filed his Opposition.18 Pending the
resolution thereof, respondent was arraigned.19 Subsequently, without the RTC-Cebu having resolved the application of the protection order, respondent
filed a Motion to Dismiss on the ground of: (1) lack of jurisdiction over the offense charged; and (2) prescription of the crime charged.20
On February 19, 2010, the RTC-Cebu issued the herein assailed Order,21 dismissing the instant criminal case against respondent on the ground that the
facts charged in the information do not constitute an offense with respect to the respondent who is an alien, the dispositive part of which states:
WHEREFORE, the Court finds that the facts charged in the information do not constitute an offense with respect to the accused, he being an alien, and
accordingly, orders this case DISMISSED.
The bail bond posted by accused Ernst Johan Brinkman Van Wilsem for his provisional liberty is hereby cancelled (sic) and ordered released.
SO ORDERED.
Cebu City, Philippines, February 19, 2010.
Thereafter, petitioner filed her Motion for Reconsideration thereto reiterating respondents obligation to support their child under Article 19523 of the Family
Code, thus, failure to do so makes him liable under R.A. No. 9262 which "equally applies to all persons in the Philippines who are obliged to support their
minor children regardless of the obligors nationality."24
On September 1, 2010, the lower court issued an Order25 denying petitioners Motion for Reconsideration and reiterating its previous ruling. Thus:
x x x The arguments therein presented are basically a rehash of those advanced earlier in the memorandum of the prosecution. Thus, the court hereby
reiterates its ruling that since the accused is a foreign national he is not subject to our national law (The Family Code) in regard to a parents duty and obligation
to givesupport to his child. Consequently, he cannot be charged of violating R.A. 9262 for his alleged failure to support his child. Unless it is conclusively
established that R.A. 9262 applies to a foreigner who fails to give support tohis child, notwithstanding that he is not bound by our domestic law which mandates
a parent to give such support, it is the considered opinion of the court that no prima faciecase exists against the accused herein, hence, the case should be
dismissed.
WHEREFORE, the motion for reconsideration is hereby DENIED for lack of merit.
45
SO ORDERED.
Cebu City, Philippines, September 1, 2010.26
Hence, the present Petition for Review on Certiorari raising the following issues:
1. Whether or not a foreign national has an obligation to support his minor child under Philippine law; and
2. Whether or not a foreign national can be held criminally liable under R.A. No. 9262 for his unjustified failure to support his minor child.27
At the outset, let it be emphasized that We are taking cognizance of the instant petition despite the fact that the same was directly lodged with the Supreme
Court, consistent with the ruling in Republic v. Sunvar Realty Development Corporation,28 which lays down the instances when a ruling of the trial court may
be brought on appeal directly to the Supreme Court without violating the doctrine of hierarchy of courts, to wit:
x x x Nevertheless, the Rules do not prohibit any of the parties from filing a Rule 45 Petition with this Court, in case only questions of law are raised or involved.
This latter situation was one that petitioners found themselves in when they filed the instant Petition to raise only questions of law. In Republic v. Malabanan,
the Court clarified the three modes of appeal from decisions of the RTC, to wit: (1) by ordinary appeal or appeal by writ of error under Rule 41, whereby
judgment was rendered in a civil or criminal action by the RTC in the exercise of its original jurisdiction; (2) by a petition for review under Rule 42, whereby
judgment was rendered by the RTC in the exercise of its appellate jurisdiction; and (3) by a petition for review on certiorari before the Supreme Court under
Rule 45. "The first mode of appeal is taken to the [Court of Appeals] on questions of fact or mixed questions of fact and law. The second mode of appeal is
brought to the CA on questions of fact, of law, or mixed questions of fact and law. The third mode of appealis elevated to the Supreme Court only on questions
of law." (Emphasis supplied)
There is a question of law when the issue does not call for an examination of the probative value of the evidence presented or of the truth or falsehood of the
facts being admitted, and the doubt concerns the correct application of law and jurisprudence on the matter. The resolution of the issue must rest solely on
what the law provides on the given set of circumstances.29
Indeed, the issues submitted to us for resolution involve questions of law the response thereto concerns the correct application of law and jurisprudence on
a given set of facts, i.e.,whether or not a foreign national has an obligation to support his minor child under Philippine law; and whether or not he can be held
criminally liable under R.A. No. 9262 for his unjustified failure to do so.
It cannot be negated, moreover, that the instant petition highlights a novel question of law concerning the liability of a foreign national who allegedly commits
acts and omissions punishable under special criminal laws, specifically in relation to family rights and duties. The inimitability of the factual milieu of the present
case, therefore, deserves a definitive ruling by this Court, which will eventually serve as a guidepost for future cases. Furthermore, dismissing the instant
petition and remanding the same to the CA would only waste the time, effort and resources of the courts. Thus, in the present case, considerations of efficiency
and economy in the administration of justice should prevail over the observance of the hierarchy of courts.
Now, on the matter of the substantive issues, We find the petition meritorious. Nonetheless, we do not fully agree with petitioners contentions.
46
To determine whether or not a person is criminally liable under R.A. No. 9262, it is imperative that the legal obligation to support exists.
Petitioner invokes Article 19530 of the Family Code, which provides the parents obligation to support his child. Petitioner contends that notwithstanding the
existence of a divorce decree issued in relation to Article 26 of the Family Code,31 respondent is not excused from complying with his obligation to support
his minor child with petitioner.
On the other hand, respondent contends that there is no sufficient and clear basis presented by petitioner that she, as well as her minor son, are entitled to
financial support.32 Respondent also added that by reason of the Divorce Decree, he is not obligated topetitioner for any financial support.33
On this point, we agree with respondent that petitioner cannot rely on Article 19534 of the New Civil Code in demanding support from respondent, who is a
foreign citizen, since Article 1535 of the New Civil Code stresses the principle of nationality. In other words, insofar as Philippine laws are concerned,
specifically the provisions of the Family Code on support, the same only applies to Filipino citizens. By analogy, the same principle applies to foreigners such
that they are governed by their national law with respect to family rights and duties.36
The obligation to give support to a child is a matter that falls under family rights and duties. Since the respondent is a citizen of Holland or the Netherlands,
we agree with the RTC-Cebu that he is subject to the laws of his country, not to Philippinelaw, as to whether he is obliged to give support to his child, as well
as the consequences of his failure to do so.37
In the case of Vivo v. Cloribel,38 the Court held that
Furthermore, being still aliens, they are not in position to invoke the provisions of the Civil Code of the Philippines, for that Code cleaves to the principle that
family rights and duties are governed by their personal law, i.e.,the laws of the nation to which they belong even when staying in a foreign country (cf. Civil
Code, Article 15).39
It cannot be gainsaid, therefore, that the respondent is not obliged to support petitioners son under Article195 of the Family Code as a consequence of the
Divorce Covenant obtained in Holland. This does not, however, mean that respondent is not obliged to support petitioners son altogether.
In international law, the party who wants to have a foreign law applied to a dispute or case has the burden of proving the foreign law.40 In the present case,
respondent hastily concludes that being a national of the Netherlands, he is governed by such laws on the matter of provision of and capacity to support.41
While respondent pleaded the laws of the Netherlands in advancing his position that he is not obliged to support his son, he never proved the same.
It is incumbent upon respondent to plead and prove that the national law of the Netherlands does not impose upon the parents the obligation to support their
child (either before, during or after the issuance of a divorce decree), because Llorente v. Court of Appeals,42 has already enunciated that:
True, foreign laws do not prove themselves in our jurisdiction and our courts are not authorized to takejudicial notice of them. Like any other fact, they must
be alleged and proved.43
47
In view of respondents failure to prove the national law of the Netherlands in his favor, the doctrine of processual presumption shall govern. Under this
doctrine, if the foreign law involved is not properly pleaded and proved, our courts will presume that the foreign law is the same as our local or domestic or
internal law.44 Thus, since the law of the Netherlands as regards the obligation to support has not been properly pleaded and proved in the instant case, it is
presumed to be the same with Philippine law, which enforces the obligation of parents to support their children and penalizing the non-compliance therewith.
Moreover, while in Pilapil v. Ibay-Somera,45 the Court held that a divorce obtained in a foreign land as well as its legal effects may be recognized in the
Philippines in view of the nationality principle on the matter of status of persons, the Divorce Covenant presented by respondent does not completely show
that he is notliable to give support to his son after the divorce decree was issued. Emphasis is placed on petitioners allegation that under the second page of
the aforesaid covenant, respondents obligation to support his child is specifically stated,46 which was not disputed by respondent.
We likewise agree with petitioner that notwithstanding that the national law of respondent states that parents have no obligation to support their children or
that such obligation is not punishable by law, said law would still not find applicability,in light of the ruling in Bank of America, NT and SA v. American Realty
Corporation,47 to wit:
In the instant case, assuming arguendo that the English Law on the matter were properly pleaded and proved in accordance with Section 24, Rule 132 of the
Rules of Court and the jurisprudence laid down in Yao Kee, et al. vs. Sy-Gonzales, said foreign law would still not find applicability.
Thus, when the foreign law, judgment or contract is contrary to a sound and established public policy of the forum, the said foreign law, judgment or order
shall not be applied.
Additionally, prohibitive laws concerning persons, their acts or property, and those which have for their object public order, public policy and good customs
shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country.
The public policy sought to be protected in the instant case is the principle imbedded in our jurisdiction proscribing the splitting up of a single cause of action.
Section 4, Rule 2 of the 1997 Rules of Civil Procedure is pertinent
If two or more suits are instituted on the basis of the same cause of action, the filing of one or a judgment upon the merits in any one is available as a ground
for the dismissal of the others. Moreover, foreign law should not be applied when its application would work undeniable injustice to the citizens or residents of
the forum. To give justice is the most important function of law; hence, a law, or judgment or contract that is obviously unjust negates the fundamental principles
of Conflict of Laws.48
Applying the foregoing, even if the laws of the Netherlands neither enforce a parents obligation to support his child nor penalize the noncompliance therewith,
such obligation is still duly enforceable in the Philippines because it would be of great injustice to the child to be denied of financial support when the latter is
entitled thereto.
48
We emphasize, however, that as to petitioner herself, respondent is no longer liable to support his former wife, in consonance with the ruling in San Luis v.
San Luis,49 to wit:
As to the effect of the divorce on the Filipino wife, the Court ruled that she should no longerbe considered marriedto the alien spouse. Further, she should not
be required to perform her marital duties and obligations. It held:
To maintain, as private respondent does, that, under our laws, petitioner has to be considered still married to private respondent and still subject to a wife's
obligations under Article 109, et. seq. of the Civil Code cannot be just. Petitioner should not be obliged to live together with, observe respect and fidelity, and
render support to private respondent. The latter should not continue to be one of her heirs with possible rights to conjugal property. She should not be
discriminated against in her own country if the ends of justice are to be served. (Emphasis added)50
Based on the foregoing legal precepts, we find that respondent may be made liable under Section 5(e) and (i) of R.A. No. 9262 for unjustly refusing or failing
to give support topetitioners son, to wit:
SECTION 5. Acts of Violence Against Women and Their Children.- The crime of violence against women and their children is committed through any of the
following acts:
xxxx
(e) Attempting to compel or compelling the woman or her child to engage in conduct which the woman or her child has the right to desist from or desist from
conduct which the woman or her child has the right to engage in, or attempting to restrict or restricting the woman's or her child's freedom of movement or
conduct by force or threat of force, physical or other harm or threat of physical or other harm, or intimidation directed against the woman or child. This shall
include, butnot limited to, the following acts committed with the purpose or effect of controlling or restricting the woman's or her child's movement or conduct:
xxxx
(2) Depriving or threatening to deprive the woman or her children of financial support legally due her or her family, or deliberately providing the woman's
children insufficient financial support; x x x x
(i) Causing mental or emotional anguish, public ridicule or humiliation to the woman or her child, including, but not limited to, repeated verbal and emotional
abuse, and denial of financial support or custody of minor childrenof access to the woman's child/children.51
Under the aforesaid special law, the deprivation or denial of financial support to the child is considered anact of violence against women and children.
In addition, considering that respondent is currently living in the Philippines, we find strength in petitioners claim that the Territoriality Principle in criminal law,
in relation to Article 14 of the New Civil Code, applies to the instant case, which provides that: "[p]enal laws and those of public security and safety shall be
obligatory upon all who live and sojourn in Philippine territory, subject to the principle of public international law and to treaty stipulations." On this score, it is
indisputable that the alleged continuing acts of respondent in refusing to support his child with petitioner is committed here in the Philippines as all of the
parties herein are residents of the Province of Cebu City. As such, our courts have territorial jurisdiction over the offense charged against respondent. It is
likewise irrefutable that jurisdiction over the respondent was acquired upon his arrest.
49
Finally, we do not agree with respondents argument that granting, but not admitting, that there is a legal basis for charging violation of R.A. No. 9262 in the
instant case, the criminal liability has been extinguished on the ground of prescription of crime52 under Section 24 of R.A. No. 9262, which provides that:
SECTION 24. Prescriptive Period. Acts falling under Sections 5(a) to 5(f) shall prescribe in twenty (20) years. Acts falling under Sections 5(g) to 5(I) shall
prescribe in ten (10) years.
The act of denying support to a child under Section 5(e)(2) and (i) of R.A. No. 9262 is a continuing offense,53 which started in 1995 but is still ongoing at
present. Accordingly, the crime charged in the instant case has clearly not prescribed.
Given, however, that the issue on whether respondent has provided support to petitioners child calls for an examination of the probative value of the evidence
presented, and the truth and falsehood of facts being admitted, we hereby remand the determination of this issue to the RTC-Cebu which has jurisdiction over
the case.
WHEREFORE, the petition is GRANTED. The Orders dated February 19, 2010 and September 1, 2010, respectively, of the Regional Trial Court of the City
of Cebu are hereby REVERSED and SET ASIDE. The case is REMANDED to the same court to conduct further proceedings based on the merits of the case.
SO ORDERED.
PILAPIL VS IBAY SOMERA 1989
An ill-starred marriage of a Filipina and a foreigner which ended in a foreign absolute divorce, only to be followed by a criminal infidelity suit of the latter against
the former, provides Us the opportunity to lay down a decisional rule on what hitherto appears to be an unresolved jurisdictional question.
On September 7, 1979, petitioner Imelda Manalaysay Pilapil, a Filipino citizen, and private respondent Erich Ekkehard Geiling, a German national, were
married before the Registrar of Births, Marriages and Deaths at Friedensweiler in the Federal Republic of Germany. The marriage started auspiciously enough,
and the couple lived together for some time in Malate, Manila where their only child, Isabella Pilapil Geiling, was born on April 20, 1980. 1
Thereafter, marital discord set in, with mutual recriminations between the spouses, followed by a separation de facto between them.
After about three and a half years of marriage, such connubial disharmony eventuated in private respondent initiating a divorce proceeding against petitioner
in Germany before the Schoneberg Local Court in January, 1983. He claimed that there was failure of their marriage and that they had been living apart since
April, 1982. 2
Petitioner, on the other hand, filed an action for legal separation, support and separation of property before the Regional Trial Court of Manila, Branch XXXII,
on January 23, 1983 where the same is still pending as Civil Case No. 83-15866. 3
On January 15, 1986, Division 20 of the Schoneberg Local Court, Federal Republic of Germany, promulgated a decree of divorce on the ground of failure of
marriage of the spouses. The custody of the child was granted to petitioner. The records show that under German law said court was locally and internationally
50
competent for the divorce proceeding and that the dissolution of said marriage was legally founded on and authorized by the applicable law of that foreign
jurisdiction. 4
On June 27, 1986, or more than five months after the issuance of the divorce decree, private respondent filed two complaints for adultery before the City
Fiscal of Manila alleging that, while still married to said respondent, petitioner "had an affair with a certain William Chia as early as 1982 and with yet another
man named Jesus Chua sometime in 1983". Assistant Fiscal Jacinto A. de los Reyes, Jr., after the corresponding investigation, recommended the dismissal
of the cases on the ground of insufficiency of evidence. 5 However, upon review, the respondent city fiscal approved a resolution, dated January 8, 1986,
directing the filing of two complaints for adultery against the petitioner. 6 The complaints were accordingly filed and were eventually raffled to two branches of
the Regional Trial Court of Manila. The case entitled "People of the Philippines vs. Imelda Pilapil and William Chia", docketed as Criminal Case No. 87-52435,
was assigned to Branch XXVI presided by the respondent judge; while the other case, "People of the Philippines vs. Imelda Pilapil and James Chua", docketed
as Criminal Case No. 87-52434 went to the sala of Judge Leonardo Cruz, Branch XXV, of the same court. 7
On March 14, 1987, petitioner filed a petition with the Secretary of Justice asking that the aforesaid resolution of respondent fiscal be set aside and the cases
against her be dismissed. 8 A similar petition was filed by James Chua, her co-accused in Criminal Case No. 87-52434. The Secretary of Justice, through the
Chief State Prosecutor, gave due course to both petitions and directed the respondent city fiscal to inform the Department of Justice "if the accused have
already been arraigned and if not yet arraigned, to move to defer further proceedings" and to elevate the entire records of both cases to his office for review.
9
Petitioner thereafter filed a motion in both criminal cases to defer her arraignment and to suspend further proceedings thereon. 10 As a consequence, Judge
Leonardo Cruz suspended proceedings in Criminal Case No. 87-52434. On the other hand, respondent judge merely reset the date of the arraignment in
Criminal Case No. 87-52435 to April 6, 1987. Before such scheduled date, petitioner moved for the cancellation of the arraignment and for the suspension of
proceedings in said Criminal Case No. 87-52435 until after the resolution of the petition for review then pending before the Secretary of Justice. 11 A motion
to quash was also filed in the same case on the ground of lack of jurisdiction, 12 which motion was denied by the respondent judge in an order dated
September 8, 1987. The same order also directed the arraignment of both accused therein, that is, petitioner and William Chia. The latter entered a plea of
not guilty while the petitioner refused to be arraigned. Such refusal of the petitioner being considered by respondent judge as direct contempt, she and her
counsel were fined and the former was ordered detained until she submitted herself for arraignment. 13 Later, private respondent entered a plea of not guilty.
14
On October 27, 1987, petitioner filed this special civil action for certiorari and prohibition, with a prayer for a temporary restraining order, seeking the annulment
of the order of the lower court denying her motion to quash. The petition is anchored on the main ground that the court is without jurisdiction "to try and decide
the charge of adultery, which is a private offense that cannot be prosecuted de officio (sic), since the purported complainant, a foreigner, does not qualify as
an offended spouse having obtained a final divorce decree under his national law prior to his filing the criminal complaint." 15
On October 21, 1987, this Court issued a temporary restraining order enjoining the respondents from implementing the aforesaid order of September 8, 1987
and from further proceeding with Criminal Case No. 87-52435. Subsequently, on March 23, 1988 Secretary of Justice Sedfrey A. Ordoez acted on the
aforesaid petitions for review and, upholding petitioner's ratiocinations, issued a resolution directing the respondent city fiscal to move for the dismissal of the
complaints against the petitioner. 16
51
We find this petition meritorious. The writs prayed for shall accordingly issue.
Under Article 344 of the Revised Penal Code, 17 the crime of adultery, as well as four other crimes against chastity, cannot be prosecuted except upon a
sworn written complaint filed by the offended spouse. It has long since been established, with unwavering consistency, that compliance with this rule is a
jurisdictional, and not merely a formal, requirement. 18 While in point of strict law the jurisdiction of the court over the offense is vested in it by the Judiciary
Law, the requirement for a sworn written complaint is just as jurisdictional a mandate since it is that complaint which starts the prosecutory proceeding 19 and
without which the court cannot exercise its jurisdiction to try the case.
Now, the law specifically provides that in prosecutions for adultery and concubinage the person who can legally file the complaint should be the offended
spouse, and nobody else. Unlike the offenses of seduction, abduction, rape and acts of lasciviousness, no provision is made for the prosecution of the crimes
of adultery and concubinage by the parents, grandparents or guardian of the offended party. The so-called exclusive and successive rule in the prosecution
of the first four offenses above mentioned do not apply to adultery and concubinage. It is significant that while the State, as parens patriae, was added and
vested by the 1985 Rules of Criminal Procedure with the power to initiate the criminal action for a deceased or incapacitated victim in the aforesaid offenses
of seduction, abduction, rape and acts of lasciviousness, in default of her parents, grandparents or guardian, such amendment did not include the crimes of
adultery and concubinage. In other words, only the offended spouse, and no other, is authorized by law to initiate the action therefor.
Corollary to such exclusive grant of power to the offended spouse to institute the action, it necessarily follows that such initiator must have the status, capacity
or legal representation to do so at the time of the filing of the criminal action. This is a familiar and express rule in civil actions; in fact, lack of legal capacity to
sue, as a ground for a motion to dismiss in civil cases, is determined as of the filing of the complaint or petition.
The absence of an equivalent explicit rule in the prosecution of criminal cases does not mean that the same requirement and rationale would not apply.
Understandably, it may not have been found necessary since criminal actions are generally and fundamentally commenced by the State, through the People
of the Philippines, the offended party being merely the complaining witness therein. However, in the so-called "private crimes" or those which cannot be
prosecuted de oficio, and the present prosecution for adultery is of such genre, the offended spouse assumes a more predominant role since the right to
commence the action, or to refrain therefrom, is a matter exclusively within his power and option.
This policy was adopted out of consideration for the aggrieved party who might prefer to suffer the outrage in silence rather than go through the scandal of a
public trial. 20 Hence, as cogently argued by petitioner, Article 344 of the Revised Penal Code thus presupposes that the marital relationship is still subsisting
at the time of the institution of the criminal action for, adultery. This is a logical consequence since the raison d'etre of said provision of law would be absent
where the supposed offended party had ceased to be the spouse of the alleged offender at the time of the filing of the criminal case. 21
In these cases, therefore, it is indispensable that the status and capacity of the complainant to commence the action be definitely established and, as already
demonstrated, such status or capacity must indubitably exist as of the time he initiates the action. It would be absurd if his capacity to bring the action would
be determined by his status before or subsequent to the commencement thereof, where such capacity or status existed prior to but ceased before, or was
acquired subsequent to but did not exist at the time of, the institution of the case. We would thereby have the anomalous spectacle of a party bringing suit at
the very time when he is without the legal capacity to do so.
52
To repeat, there does not appear to be any local precedential jurisprudence on the specific issue as to when precisely the status of a complainant as an
offended spouse must exist where a criminal prosecution can be commenced only by one who in law can be categorized as possessed of such status. Stated
differently and with reference to the present case, the inquiry ;would be whether it is necessary in the commencement of a criminal action for adultery that the
marital bonds between the complainant and the accused be unsevered and existing at the time of the institution of the action by the former against the latter.
American jurisprudence, on cases involving statutes in that jurisdiction which are in pari materia with ours, yields the rule that after a divorce has been decreed,
the innocent spouse no longer has the right to institute proceedings against the offenders where the statute provides that the innocent spouse shall have the
exclusive right to institute a prosecution for adultery. Where, however, proceedings have been properly commenced, a divorce subsequently granted can
have no legal effect on the prosecution of the criminal proceedings to a conclusion. 22
In the cited Loftus case, the Supreme Court of Iowa held that
'No prosecution for adultery can be commenced except on the complaint of the husband or wife.' Section 4932, Code. Though Loftus was husband of
defendant when the offense is said to have been committed, he had ceased to be such when the prosecution was begun; and appellant insists that his status
was not such as to entitle him to make the complaint. We have repeatedly said that the offense is against the unoffending spouse, as well as the state, in
explaining the reason for this provision in the statute; and we are of the opinion that the unoffending spouse must be such when the prosecution is commenced.
(Emphasis supplied.)
We see no reason why the same doctrinal rule should not apply in this case and in our jurisdiction, considering our statutory law and jural policy on the matter.
We are convinced that in cases of such nature, the status of the complainant vis-a-vis the accused must be determined as of the time the complaint was filed.
Thus, the person who initiates the adultery case must be an offended spouse, and by this is meant that he is still married to the accused spouse, at the time
of the filing of the complaint.
In the present case, the fact that private respondent obtained a valid divorce in his country, the Federal Republic of Germany, is admitted. Said divorce and
its legal effects may be recognized in the Philippines insofar as private respondent is concerned 23 in view of the nationality principle in our civil law on the
matter of status of persons.
Thus, in the recent case of Van Dorn vs. Romillo, Jr., et al., 24 after a divorce was granted by a United States court between Alice Van Dornja Filipina, and
her American husband, the latter filed a civil case in a trial court here alleging that her business concern was conjugal property and praying that she be ordered
to render an accounting and that the plaintiff be granted the right to manage the business. Rejecting his pretensions, this Court perspicuously demonstrated
the error of such stance, thus:
There can be no question as to the validity of that Nevada divorce in any of the States of the United States. The decree is binding on private respondent as
an American citizen. For instance, private respondent cannot sue petitioner, as her husband, in any State of the Union. ...
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, only Philippine nationals are covered by the policy against absolute
divorces the same being considered contrary to our concept of public policy and morality. However, aliens may obtain divorces abroad, which may be
recognized in the Philippines, provided they are valid according to their national law. ...
53
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would have no standing to sue in the case below as petitioner's
husband entitled to exercise control over conjugal assets. ... 25
Under the same considerations and rationale, private respondent, being no longer the husband of petitioner, had no legal standing to commence the adultery
case under the imposture that he was the offended spouse at the time he filed suit.
The allegation of private respondent that he could not have brought this case before the decree of divorce for lack of knowledge, even if true, is of no legal
significance or consequence in this case. When said respondent initiated the divorce proceeding, he obviously knew that there would no longer be a family
nor marriage vows to protect once a dissolution of the marriage is decreed. Neither would there be a danger of introducing spurious heirs into the family,
which is said to be one of the reasons for the particular formulation of our law on adultery, 26 since there would thenceforth be no spousal relationship to
speak of. The severance of the marital bond had the effect of dissociating the former spouses from each other, hence the actuations of one would not affect
or cast obloquy on the other.
The aforecited case of United States vs. Mata cannot be successfully relied upon by private respondent. In applying Article 433 of the old Penal Code,
substantially the same as Article 333 of the Revised Penal Code, which punished adultery "although the marriage be afterwards declared void", the Court
merely stated that "the lawmakers intended to declare adulterous the infidelity of a married woman to her marital vows, even though it should be made to
appear that she is entitled to have her marriage contract declared null and void, until and unless she actually secures a formal judicial declaration to that
effect". Definitely, it cannot be logically inferred therefrom that the complaint can still be filed after the declaration of nullity because such declaration that the
marriage is void ab initio is equivalent to stating that it never existed. There being no marriage from the beginning, any complaint for adultery filed after said
declaration of nullity would no longer have a leg to stand on. Moreover, what was consequently contemplated and within the purview of the decision in said
case is the situation where the criminal action for adultery was filed before the termination of the marriage by a judicial declaration of its nullity ab initio. The
same rule and requisite would necessarily apply where the termination of the marriage was effected, as in this case, by a valid foreign divorce.
Private respondent's invocation of Donio-Teves, et al. vs. Vamenta, hereinbefore cited, 27 must suffer the same fate of inapplicability. A cursory reading of
said case reveals that the offended spouse therein had duly and seasonably filed a complaint for adultery, although an issue was raised as to its sufficiency
but which was resolved in favor of the complainant. Said case did not involve a factual situation akin to the one at bar or any issue determinative of the
controversy herein.
WHEREFORE, the questioned order denying petitioner's motion to quash is SET ASIDE and another one entered DISMISSING the complaint in Criminal
Case No. 87-52435 for lack of jurisdiction. The temporary restraining order issued in this case on October 21, 1987 is hereby made permanent.
SO ORDERED.
RECIO VS RECIO 2001
A divorce obtained abroad by an alien may be recognized in our jurisdiction, provided such decree is valid according to the national law of the foreigner.
However, the divorce decree and the governing personal law of the alien spouse who obtained the divorce must be proven. Our courts do not take judicial
54
notice of foreign laws and judgments; hence, like any other facts, both the divorce decree and the national law of the alien must be alleged and proven
according to our law on evidence.
The Case
Before us is a Petition for Review under Rule 45 of the Rules of Court, seeking to nullify the January 7, 1999 Decision[1] and the March 24, 1999 Order[2] of
the Regional Trial Court of Cabanatuan City, Branch 28, in Civil Case No. 3026AF. The assailed Decision disposed as follows:
WHEREFORE, this Court declares the marriage between Grace J. Garcia and Rederick A. Recio solemnized on January 12, 1994 at Cabanatuan City as
dissolved and both parties can now remarry under existing and applicable laws to any and/or both parties.[3]
The assailed Order denied reconsideration of the above-quoted Decision.
The Facts
Rederick A. Recio, a Filipino, was married to Editha Samson, an Australian citizen, in Malabon, Rizal, on March 1, 1987.[4] They lived together as husband
and wife in Australia. On May 18, 1989, [5] a decree of divorce, purportedly dissolving the marriage, was issued by an Australian family court.
On June 26, 1992, respondent became an Australian citizen, as shown by a Certificate of Australian Citizenship issued by the Australian government.[6]
Petitioner -- a Filipina -- and respondent were married on January 12, 1994 in Our Lady of Perpetual Help Church in Cabanatuan City.[7] In their application
for a marriage license, respondent was declared as single and Filipino.[8]
Starting October 22, 1995, petitioner and respondent lived separately without prior judicial dissolution of their marriage. While the two were still in Australia,
their conjugal assets were divided on May 16, 1996, in accordance with their Statutory Declarations secured in Australia.[9]
On March 3, 1998, petitioner filed a Complaint for Declaration of Nullity of Marriage[10] in the court a quo, on the ground of bigamy -- respondent allegedly
had a prior subsisting marriage at the time he married her on January 12, 1994. She claimed that she learned of respondents marriage to Editha Samson
only in November, 1997.
In his Answer, respondent averred that, as far back as 1993, he had revealed to petitioner his prior marriage and its subsequent dissolution.[11] He contended
that his first marriage to an Australian citizen had been validly dissolved by a divorce decree obtained in Australia in 1989;[12] thus, he was legally capacitated
to marry petitioner in 1994.
On July 7, 1998 -- or about five years after the couples wedding and while the suit for the declaration of nullity was pending -- respondent was able to secure
a divorce decree from a family court in Sydney, Australia because the marriage ha[d] irretrievably broken down.[13]
55
Respondent prayed in his Answer that the Complaint be dismissed on the ground that it stated no cause of action.[14] The Office of the Solicitor General
agreed with respondent.[15] The court marked and admitted the documentary evidence of both parties.[16] After they submitted their respective memoranda,
the case was submitted for resolution.[17]
Thereafter, the trial court rendered the assailed Decision and Order.
Ruling of the Trial Court
The trial court declared the marriage dissolved on the ground that the divorce issued in Australia was valid and recognized in the Philippines. It deemed the
marriage ended, but not on the basis of any defect in an essential element of the marriage; that is, respondents alleged lack of legal capacity to remarry.
Rather, it based its Decision on the divorce decree obtained by respondent. The Australian divorce had ended the marriage; thus, there was no more marital
union to nullify or annul.
Hence, this Petition.[18]
Issues
Petitioner submits the following issues for our consideration:
The trial court gravely erred in finding that the divorce decree obtained in Australia by the respondent ipso facto terminated his first marriage to Editha Samson
thereby capacitating him to contract a second marriage with the petitioner.
The failure of the respondent, who is now a naturalized Australian, to present a certificate of legal capacity to marry constitutes absence of a substantial
requisite voiding the petitioners marriage to the respondent
The trial court seriously erred in the application of Art. 26 of the Family Code in this case.
The trial court patently and grievously erred in disregarding Arts. 11, 13, 21, 35, 40, 52 and 53 of the Family Code as the applicable provisions in this case.
56
The trial court gravely erred in pronouncing that the divorce decree obtained by the respondent in Australia ipso facto capacitated the parties to remarry,
without first securing a recognition of the judgment granting the divorce decree before our courts.[19]
The Petition raises five issues, but for purposes of this Decision, we shall concentrate on two pivotal ones: (1) whether the divorce between respondent and
Editha Samson was proven, and (2) whether respondent was proven to be legally capacitated to marry petitioner. Because of our ruling on these two, there
is no more necessity to take up the rest.
The Courts Ruling
The Petition is partly meritorious.
First Issue:
Proving the Divorce Between Respondent and Editha Samson
Petitioner assails the trial courts recognition of the divorce between respondent and Editha Samson. Citing Adong v. Cheong Seng Gee,[20] petitioner argues
that the divorce decree, like any other foreign judgment, may be given recognition in this jurisdiction only upon proof of the existence of (1) the foreign law
allowing absolute divorce and (2) the alleged divorce decree itself. She adds that respondent miserably failed to establish these elements.
Petitioner adds that, based on the first paragraph of Article 26 of the Family Code, marriages solemnized abroad are governed by the law of the place where
they were celebrated (the lex loci celebrationis). In effect, the Code requires the presentation of the foreign law to show the conformity of the marriage in
question to the legal requirements of the place where the marriage was performed.
At the outset, we lay the following basic legal principles as the take-off points for our discussion. Philippine law does not provide for absolute divorce; hence,
our courts cannot grant it.[21] A marriage between two Filipinos cannot be dissolved even by a divorce obtained abroad, because of Articles 15[22] and 17[23]
of the Civil Code.[24] In mixed marriages involving a Filipino and a foreigner, Article 26[25] of the Family Code allows the former to contract a subsequent
marriage in case the divorce is validly obtained abroad by the alien spouse capacitating him or her to remarry.[26] A divorce obtained abroad by a couple,
who are both aliens, may be recognized in the Philippines, provided it is consistent with their respective national laws.[27]
A comparison between marriage and divorce, as far as pleading and proof are concerned, can be made. Van Dorn v. Romillo Jr. decrees that aliens may
obtain divorces abroad, which may be recognized in the Philippines, provided they are valid according to their national law.[28] Therefore, before a foreign
divorce decree can be recognized by our courts, the party pleading it must prove the divorce as a fact and demonstrate its conformity to the foreign law
allowing it.[29] Presentation solely of the divorce decree is insufficient.
Divorce as a Question of Fact

Petitioner insists that before a divorce decree can be admitted in evidence, it must first comply with the registration requirements under Articles 11, 13 and 52
of the Family Code. These articles read as follows:
57
ART. 11. Where a marriage license is required, each of the contracting parties shall file separately a sworn application for such license with the proper local
civil registrar which shall specify the following:
xxxxxxxxx
(5) If previously married, how, when and where the previous marriage was dissolved or annulled;
xxxxxxxxx
ART. 13. In case either of the contracting parties has been previously married, the applicant shall be required to
ART. 13. In case either of the contracting parties has been previously married, the applicant shall be required to furnish, instead of the birth or baptismal
certificate required in the last preceding article, the death certificate of the deceased spouse or the judicial decree of the absolute divorce, or the judicial
decree of annulment or declaration of nullity of his or her previous marriage. x x x.
ART. 52. The judgment of annulment or of absolute nullity of the marriage, the partition and distribution of the properties of the spouses, and the delivery of
the childrens presumptive legitimes shall be recorded in the appropriate civil registry and registries of property; otherwise, the same shall not affect their
persons.
Respondent, on the other hand, argues that the Australian divorce decree is a public document -- a written official act of an Australian family court. Therefore,
it requires no further proof of its authenticity and due execution.
Respondent is getting ahead of himself. Before a foreign judgment is given presumptive evidentiary value, the document must first be presented and admitted
in evidence.[30] A divorce obtained abroad is proven by the divorce decree itself. Indeed the best evidence of a judgment is the judgment itself.[31] The
decree purports to be a written act or record of an act of an official body or tribunal of a foreign country.[32]
Under Sections 24 and 25 of Rule 132, on the other hand, a writing or document may be proven as a public or official record of a foreign country by either (1)
an official publication or (2) a copy thereof attested[33] by the officer having legal custody of the document. If the record is not kept in the Philippines, such
copy must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign
country in which the record is kept and (b) authenticated by the seal of his office. [34]
The divorce decree between respondent and Editha Samson appears to be an authentic one issued by an Australian family court.[35] However, appearance
is not sufficient; compliance with the aforementioned rules on evidence must be demonstrated.
Fortunately for respondents cause, when the divorce decree of May 18, 1989 was submitted in evidence, counsel for petitioner objected, not to its admissibility,
but only to the fact that it had not been registered in the Local Civil Registry of Cabanatuan City.[36] The trial court ruled that it was admissible, subject to
petitioners qualification.[37] Hence, it was admitted in evidence and accorded weight by the judge. Indeed, petitioners failure to object properly rendered the
divorce decree admissible as a written act of the Family Court of Sydney, Australia.[38]
58
Compliance with the quoted articles (11, 13 and 52) of the Family Code is not necessary; respondent was no longer bound by Philippine personal laws after
he acquired Australian citizenship in 1992.[39] Naturalization is the legal act of adopting an alien and clothing him with the political and civil rights belonging
to a citizen.[40] Naturalized citizens, freed from the protective cloak of their former states, don the attires of their adoptive countries. By becoming an Australian,
respondent severed his allegiance to the Philippines and the vinculum juris that had tied him to Philippine personal laws.
Burden of Proving Australian Law

Respondent contends that the burden to prove Australian divorce law falls upon petitioner, because she is the party challenging the validity of a foreign
judgment. He contends that petitioner was satisfied with the original of the divorce decree and was cognizant of the marital laws of Australia, because she
had lived and worked in that country for quite a long time. Besides, the Australian divorce law is allegedly known by Philippine courts; thus, judges may take
judicial notice of foreign laws in the exercise of sound discretion.
We are not persuaded. The burden of proof lies with the party who alleges the existence of a fact or thing necessary in the prosecution or defense of an
action.[41] In civil cases, plaintiffs have the burden of proving the material allegations of the complaint when those are denied by the answer; and defendants
have the burden of proving the material allegations in their answer when they introduce new matters.[42] Since the divorce was a defense raised by
respondent, the burden of proving the pertinent Australian law validating it falls squarely upon him.
It is well-settled in our jurisdiction that our courts cannot take judicial notice of foreign laws.[43] Like any other facts, they must be alleged and proved.
Australian marital laws are not among those matters that judges are supposed to know by reason of their judicial function.[44] The power of judicial notice
must be exercised with caution, and every reasonable doubt upon the subject should be resolved in the negative.
Second Issue: Respondents Legal Capacity to Remarry
Petitioner contends that, in view of the insufficient proof of the divorce, respondent was legally incapacitated to marry her in 1994. Hence, she concludes that
their marriage was void ab initio.
Respondent replies that the Australian divorce decree, which was validly admitted in evidence, adequately established his legal capacity to marry under
Australian law.
Respondents contention is untenable. In its strict legal sense, divorce means the legal dissolution of a lawful union for a cause arising after marriage. But
divorces are of different types. The two basic ones are (1) absolute divorce or a vinculo matrimonii and (2) limited divorce or a mensa et thoro. The first kind
terminates the marriage, while the second suspends it and leaves the bond in full force.[45] There is no showing in the case at bar which type of divorce was
procured by respondent.
Respondent presented a decree nisi or an interlocutory decree -- a conditional or provisional judgment of divorce. It is in effect the same as a separation from
bed and board, although an absolute divorce may follow after the lapse of the prescribed period during which no reconciliation is effected.[46]
59
Even after the divorce becomes absolute, the court may under some foreign statutes and practices, still restrict remarriage. Under some other jurisdictions,
remarriage may be limited by statute; thus, the guilty party in a divorce which was granted on the ground of adultery may be prohibited from marrying again.
The court may allow a remarriage only after proof of good behavior.[47]
On its face, the herein Australian divorce decree contains a restriction that reads:
1. A party to a marriage who marries again before this decree becomes absolute (unless the other party has died) commits the offence of bigamy.[48]
This quotation bolsters our contention that the divorce obtained by respondent may have been restricted. It did not absolutely establish his legal capacity to
remarry according to his national law. Hence, we find no basis for the ruling of the trial court, which erroneously assumed that the Australian divorce ipso facto
restored respondents capacity to remarry despite the paucity of evidence on this matter.
We also reject the claim of respondent that the divorce decree raises a disputable presumption or presumptive evidence as to his civil status based on Section
48, Rule 39[49] of the Rules of Court, for the simple reason that no proof has been presented on the legal effects of the divorce decree obtained under
Australian laws.
Significance of the Certificate of Legal Capacity

Petitioner argues that the certificate of legal capacity required by Article 21 of the Family Code was not submitted together with the application for a marriage
license. According to her, its absence is proof that respondent did not have legal capacity to remarry.
We clarify. To repeat, the legal capacity to contract marriage is determined by the national law of the party concerned. The certificate mentioned in Article 21
of the Family Code would have been sufficient to establish the legal capacity of respondent, had he duly presented it in court. A duly authenticated and
admitted certificate is prima facie evidence of legal capacity to marry on the part of the alien applicant for a marriage license.[50]
As it is, however, there is absolutely no evidence that proves respondents legal capacity to marry petitioner. A review of the records before this Court shows
that only the following exhibits were presented before the lower court: (1) for petitioner: (a) Exhibit A Complaint;[51] (b) Exhibit B Certificate of Marriage
Between Rederick A. Recio (Filipino-Australian) and Grace J. Garcia (Filipino) on January 12, 1994 in Cabanatuan City, Nueva Ecija;[52] (c) Exhibit C
Certificate of Marriage Between Rederick A. Recio (Filipino) and Editha D. Samson (Australian) on March 1, 1987 in Malabon, Metro Manila;[53] (d) Exhibit
D Office of the City Registrar of Cabanatuan City Certification that no information of annulment between Rederick A. Recio and Editha D. Samson was in its
records;[54] and (e) Exhibit E Certificate of Australian Citizenship of Rederick A. Recio;[55] (2) for respondent: (a) Exhibit 1 -- Amended Answer;[56] (b) Exhibit
2 Family Law Act 1975 Decree Nisi of Dissolution of Marriage in the Family Court of Australia;[57] (c) Exhibit 3 Certificate of Australian Citizenship of Rederick
A. Recio;[58] (d) Exhibit 4 Decree Nisi of Dissolution of Marriage in the Family Court of Australia Certificate;[59] and Exhibit 5 -- Statutory Declaration of the
Legal Separation Between Rederick A. Recio and Grace J. Garcia Recio since October 22, 1995.[60]
Based on the above records, we cannot conclude that respondent, who was then a naturalized Australian citizen, was legally capacitated to marry petitioner
on January 12, 1994. We agree with petitioners contention that the court a quo erred in finding that the divorce decree ipso facto clothed respondent with the
legal capacity to remarry without requiring him to adduce sufficient evidence to show the Australian personal law governing his status; or at the very least, to
prove his legal capacity to contract the second marriage.
60
Neither can we grant petitioners prayer to declare her marriage to respondent null and void on the ground of bigamy. After all, it may turn out that under
Australian law, he was really capacitated to marry petitioner as a direct result of the divorce decree. Hence, we believe that the most judicious course is to
remand this case to the trial court to receive evidence, if any, which show petitioners legal capacity to marry petitioner. Failing in that, then the court a quo
may declare a nullity of the parties marriage on the ground of bigamy, there being already in evidence two existing marriage certificates, which were both
obtained in the Philippines, one in Malabon, Metro Manila dated March 1, 1987 and the other, in Cabanatuan City dated January 12, 1994.
WHEREFORE, in the interest of orderly procedure and substantial justice, we REMAND the case to the court a quo for the purpose of receiving evidence
which conclusively show respondents legal capacity to marry petitioner; and failing in that, of declaring the parties marriage void on the ground of bigamy, as
above discussed. No costs.
SO ORDERED.
QUITA VS CA 1998
FE D. QUITA and Arturo T. Padlan, both Filipinos, were married in the Philippines on 18 May 1941. They were not however blessed with children. Somewhere
along the way their relationship soured. Eventually Fe sued Arturo for divorce in San Francisco, California, U.S.A. She submitted in the divorce proceedings
a private writing dated 19 July 1950 evidencing their agreement to live separately from each other and a settlement of their conjugal properties. On 23 July
1954 she obtained a final judgment of divorce. Three (3) weeks thereafter she married a certain Felix Tupaz in the same locality but their relationship also
ended in a divorce. Still in the U.S.A., she married for the third time, to a certain Wernimont.
On 16 April 1972 Arturo died. He left no will. On 31 August 1972 Lino Javier Inciong filed a petition with the Regional Trial Court of Quezon City for issuance
of letters of administration concerning the estate of Arturo in favor of the Philippine Trust Company. Respondent Blandina Dandan (also referred to as Blandina
Padlan), claiming to be the surviving spouse of Arturo Padlan, and Claro, Alexis, Ricardo, Emmanuel, Zenaida and Yolanda, all surnamed Padlan, named in
the petition as surviving children of Arturo Padlan, opposed the petition and prayed for the appointment instead of Atty. Leonardo Cabasal, which was resolved
in favor of the latter. Upon motion of the oppositors themselves, Atty. Cabasal was later replaced by Higino Castillon. On 30 April 1973 the oppositors (Blandina
and the Padlan children) submitted certified photocopies of the 19 July 1950 private writing and the final judgment of divorce between petitioner and Arturo.
Later Ruperto T. Padlan, claiming to be the sole surviving brother of the deceased Arturo, intervened.
On 7 October 1987 petitioner moved for the immediate declaration of heirs of the decedent and the distribution of his estate. At the scheduled hearing on 23
October 1987, private respondent as well as the six (6) Padlan children and Ruperto failed to appear despite due notice. On the same day, the trial court
required the submission of the records of birth of the Padlan children within ten (10) days from receipt thereof, after which, with or without the documents, the
issue on the declaration of heirs would be considered submitted for resolution. The prescribed period lapsed without the required documents being submitted.
The trial court invoking Tenchavez v. Escao[1] which held that "a foreign divorce between Filipino citizens sought and decreed after the effectivity of the
present Civil Code (Rep. Act 386) was not entitled to recognition as valid in this jurisdiction,"[2] disregarded the divorce between petitioner and Arturo.
Consequently, it expressed the view that their marriage subsisted until the death of Arturo in 1972. Neither did it consider valid their extrajudicial settlement
of conjugal properties due to lack of judicial approval.[3] On the other hand, it opined that there was no showing that marriage existed between private
61
respondent and Arturo, much less was it shown that the alleged Padlan children had been acknowledged by the deceased as his children with her. As regards
Ruperto, it found that he was a brother of Arturo. On 27 November 1987[4] only petitioner and Ruperto were declared the intestate heirs of Arturo. Accordingly,
equal adjudication of the net hereditary estate was ordered in favor of the two intestate heirs.[5]
On motion for reconsideration, Blandina and the Padlan children were allowed to present proofs that the recognition of the children by the deceased as his
legitimate children, except Alexis who was recognized as his illegitimate child, had been made in their respective records of birth. Thus on 15 February 1988[6]
partial reconsideration was granted declaring the Padlan children, with the exception of Alexis, entitled to one-half of the estate to the exclusion of Ruperto
Padlan, and petitioner to the other half.[7] Private respondent was not declared an heir. Although it was stated in the aforementioned records of birth that she
and Arturo were married on 22 April 1947, their marriage was clearly void since it was celebrated during the existence of his previous marriage to petitioner.
In their appeal to the Court of Appeals, Blandina and her children assigned as one of the errors allegedly committed by the trial court the circumstance that
the case was decided without a hearing, in violation of Sec. 1, Rule 90, of the Rules of Court, which provides that if there is a controversy before the court as
to who are the lawful heirs of the deceased person or as to the distributive shares to which each person is entitled under the law, the controversy shall be
heard and decided as in ordinary cases.
Respondent appellate court found this ground alone sufficient to sustain the appeal; hence, on 11 September 1995 it declared null and void the 27 November
1987 decision and 15 February 1988 order of the trial court, and directed the remand of the case to the trial court for further proceedings.[8] On 18 April 1996
it denied reconsideration.[9]
Should this case be remanded to the lower court for further proceedings? Petitioner insists that there is no need because, first, no legal or factual issue obtains
for resolution either as to the heirship of the Padlan children or as to their respective shares in the intestate estate of the decedent; and, second, the issue as
to who between petitioner and private respondent is the proper heir of the decedent is one of law which can be resolved in the present petition based on
established facts and admissions of the parties.
We cannot sustain petitioner. The provision relied upon by respondent court is clear: If there is a controversy before the court as to who are the lawful heirs
of the deceased person or as to the distributive shares to which each person is entitled under the law, the controversy shall be heard and decided as in
ordinary cases.
We agree with petitioner that no dispute exists either as to the right of the six (6) Padlan children to inherit from the decedent because there are proofs that
they have been duly acknowledged by him and petitioner herself even recognizes them as heirs of Arturo Padlan;[10] nor as to their respective hereditary
shares. But controversy remains as to who is the legitimate surviving spouse of Arturo. The trial court, after the parties other than petitioner failed to appear
during the scheduled hearing on 23 October 1987 of the motion for immediate declaration of heirs and distribution of estate, simply issued an order requiring
the submission of the records of birth of the Padlan children within ten (10) days from receipt thereof, after which, with or without the documents, the issue on
declaration of heirs would be deemed submitted for resolution.
We note that in her comment to petitioner's motion private respondent raised, among others, the issue as to whether petitioner was still entitled to inherit from
the decedent considering that she had secured a divorce in the U.S.A. and in fact had twice remarried. She also invoked the above quoted procedural rule.[11]
To this, petitioner replied that Arturo was a Filipino and as such remained legally married to her in spite of the divorce they obtained.[12] Reading between
62
the lines, the implication is that petitioner was no longer a Filipino citizen at the time of her divorce from Arturo. This should have prompted the trial court to
conduct a hearing to establish her citizenship. The purpose of a hearing is to ascertain the truth of the matters in issue with the aid of documentary and
testimonial evidence as well as the arguments of the parties either supporting or opposing the evidence. Instead, the lower court perfunctorily settled her claim
in her favor by merely applying the ruling in Tenchavez v. Escao.
Then in private respondent's motion to set aside and/or reconsider the lower court's decision she stressed that the citizenship of petitioner was relevant in the
light of the ruling in Van Dorn v. Romillo Jr.[13] that aliens may obtain divorces abroad, which may be recognized in the Philippines, provided they are valid
according to their national law. She prayed therefore that the case be set for hearing.[14] Petitioner opposed the motion but failed to squarely address the
issue on her citizenship.[15] The trial court did not grant private respondent's prayer for a hearing but proceeded to resolve her motion with the finding that
both petitioner and Arturo were "Filipino citizens and were married in the Philippines."[16] It maintained that their divorce obtained in 1954 in San Francisco,
California, U.S.A., was not valid in Philippine jurisdiction. We deduce that the finding on their citizenship pertained solely to the time of their marriage as the
trial court was not supplied with a basis to determine petitioner's citizenship at the time of their divorce. The doubt persisted as to whether she was still a
Filipino citizen when their divorce was decreed. The trial court must have overlooked the materiality of this aspect. Once proved that she was no longer a
Filipino citizen at the time of their divorce, Van Dorn would become applicable and petitioner could very well lose her right to inherit from Arturo.
Respondent again raised in her appeal the issue on petitioner's citizenship;[17] it did not merit enlightenment however from petitioner.[18] In the present
proceeding, petitioner's citizenship is brought anew to the fore by private respondent. She even furnishes the Court with the transcript of stenographic notes
taken on 5 May 1995 during the hearing for the reconstitution of the original of a certain transfer certificate title as well as the issuance of new owner's duplicate
copy thereof before another trial court. When asked whether she was an American citizen petitioner answered that she was since 1954.[19] Significantly, the
decree of divorce of petitioner and Arturo was obtained in the same year. Petitioner however did not bother to file a reply memorandum to erase the uncertainty
about her citizenship at the time of their divorce, a factual issue requiring hearings to be conducted by the trial court. Consequently, respondent appellate
court did not err in ordering the case returned to the trial court for further proceedings.
We emphasize however that the question to be determined by the trial court should be limited only to the right of petitioner to inherit from Arturo as his surviving
spouse. Private respondent's claim to heirship was already resolved by the trial court. She and Arturo were married on 22 April 1947 while the prior marriage
of petitioner and Arturo was subsisting thereby resulting in a bigamous marriage considered void from the beginning under Arts. 80 and 83 of the Civil Code.
Consequently, she is not a surviving spouse that can inherit from him as this status presupposes a legitimate relationship.[20]
As regards the motion of private respondent for petitioner and her counsel to be declared in contempt of court and that the present petition be dismissed for
forum shopping,[21] the same lacks merit. For forum shopping to exist the actions must involve the same transactions and same essential facts and
circumstances. There must also be identical causes of action, subject matter and issue.[22] The present petition deals with declaration of heirship while the
subsequent petitions filed before the three (3) trial courts concern the issuance of new owner's duplicate copies of titles of certain properties belonging to the
estate of Arturo. Obviously, there is no reason to declare the existence of forum shopping.
WHEREFORE, the petition is DENIED. The decision of respondent Court of Appeals ordering the remand of the case to the court of origin for further
proceedings and declaring null and void its decision holding petitioner Fe D. Quita and Ruperto T. Padlan as intestate heirs is AFFIRMED. The order of the
appellate court modifying its previous decision by granting one-half (1/2) of the net hereditary estate to the Padlan children, namely, Claro, Ricardo, Emmanuel,
Zenaida and Yolanda, with the exception of Alexis, all surnamed Padlan, instead of Arturo's brother Ruperto Padlan, is likewise AFFIRMED. The Court
63
however emphasizes that the reception of evidence by the trial court should be limited to the hereditary rights of petitioner as the surviving spouse of Arturo
Padlan.
The motion to declare petitioner and her counsel in contempt of court and to dismiss the present petition for forum shopping is DENIED.
SO ORDERED
ELMAR PEREZ VS CA 2006
This petition for certiorari and prohibition under Rule 65 of the Rules of Court assails the July 25, 2003 Decision1 of the Court of Appeals in CA-G.R. SP No.
74456 which set aside and declared as null and void the September 30, 2002 Order2 of the Regional Trial Court of Quezon City, Branch 84, granting
petitioners motion for leave to file intervention and admitting the Complaint-in-Intervention3 in Civil Case No. Q-01-44847; and its January 23, 2004
Resolution4 denying the motion for reconsideration.
Private respondent Tristan A. Catindig married Lily Gomez Catindig5 twice on May 16, 1968. The first marriage ceremony was celebrated at the Central
Methodist Church at T.M. Kalaw Street, Ermita, Manila while the second took place at the Lourdes Catholic Church in La Loma, Quezon City. The marriage
produced four children.
Several years later, the couple encountered marital problems that they decided to separate from each other. Upon advice of a mutual friend, they decided to
obtain a divorce from the Dominican Republic. Thus, on April 27, 1984, Tristan and Lily executed a Special Power of Attorney addressed to the Judge of the
First Civil Court of San Cristobal, Dominican Republic, appointing an attorney-in-fact to institute a divorce action under its laws.6
Thereafter, on April 30, 1984, the private respondents filed a joint petition for dissolution of conjugal partnership with the Regional Trial Court of Makati. On
June 12, 1984, the civil court in the Dominican Republic ratified the divorce by mutual consent of Tristan and Lily. Subsequently, on June 23, 1984, the
Regional Trial Court of Makati City, Branch 133, ordered the complete separation of properties between Tristan and Lily.
On July 14, 1984, Tristan married petitioner Elmar O. Perez in the State of Virginia in the United States7 and both lived as husband and wife until October
2001. Their union produced one offspring.8
During their cohabitation, petitioner learned that the divorce decree issued by the court in the Dominican Republic which "dissolved" the marriage between
Tristan and Lily was not recognized in the Philippines and that her marriage to Tristan was deemed void under Philippine law. When she confronted Tristan
about this, the latter assured her that he would legalize their union after he obtains an annulment of his marriage with Lily. Tristan further promised the
petitioner that he would adopt their son so that he would be entitled to an equal share in his estate as that of each of his children with Lily.9
On August 13, 2001, Tristan filed a petition for the declaration of nullity of his marriage to Lily with the Regional Trial Court of Quezon City, docketed as Case
No. Q-01-44847.
64
Subsequently, petitioner filed a Motion for Leave to File Intervention10 claiming that she has a legal interest in the matter in litigation because she knows
certain information which might aid the trial court at a truthful, fair and just adjudication of the annulment case, which the trial court granted on September 30,
2002. Petitioners complaint-in-intervention was also ordered admitted.
Tristan filed a petition for certiorari and prohibition with the Court of Appeals seeking to annul the order dated September 30, 2002 of the trial court. The Court
of Appeals granted the petition and declared as null and void the September 30, 2002 Order of the trial court granting the motion for leave to file intervention
and admitting the complaint-in-intervention.
Petitioners motion for reconsideration was denied, hence this petition for certiorari and prohibition filed under Rule 65 of the Rules of Court. Petitioner contends
that the Court of Appeals gravely abused its discretion in disregarding her legal interest in the annulment case between Tristan and Lily.
Ordinarily, the proper recourse of an aggrieved party from a decision of the Court of Appeals is a petition for review on certiorari under Rule 45 of the Rules
of Court. However, if the error subject of the recourse is one of jurisdiction, or the act complained of was granted by a court with grave abuse of discretion
amounting to lack or excess of jurisdiction, as alleged in this case, the proper remedy is a petition for certiorari under Rule 65 of the said Rules.11 This is
based on the premise that in issuing the assailed decision and resolution, the Court of Appeals acted with grave abuse of discretion, amounting to excess of
lack of jurisdiction and there is no plain, speedy and adequate remedy in the ordinary course of law. A remedy is considered plain, speedy, and adequate if it
will promptly relieve the petitioner from the injurious effect of the judgment and the acts of the lower court.12
It is therefore incumbent upon the petitioner to establish that the Court of Appeals acted with grave abuse of discretion amounting to excess or lack of
jurisdiction when it promulgated the assailed decision and resolution.
We have previously ruled that grave abuse of discretion may arise when a lower court or tribunal violates or contravenes the Constitution, the law or existing
jurisprudence. By grave abuse of discretion is meant, such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. The abuse
of discretion must be grave as where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility and must be so
patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act at all in contemplation of law.13
The word "capricious," usually used in tandem with the term "arbitrary," conveys the notion of willful and unreasoning action. Thus, when seeking the corrective
hand of certiorari, a clear showing of caprice and arbitrariness in the exercise of discretion is imperative.14
The Rules of Court laid down the parameters before a person, not a party to a case can intervene, thus:
Who may intervene. A person who has a legal interest in the matter in litigation, or in the success of either of the parties, or an interest against both, or is
so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof may, with leave of
court, be allowed to intervene in the action. The court shall consider whether or not the intervention will unduly delay or prejudice the adjudication of the rights
of the original parties, and whether or not the intervenors rights may be fully protected in a separate proceeding.15
65
The requirements for intervention are: [a] legal interest in the matter in litigation; and [b] consideration must be given as to whether the adjudication of the
original parties may be delayed or prejudiced, or whether the intervenors rights may be protected in a separate proceeding or not.16
Legal interest, which entitles a person to intervene, must be in the matter in litigation and of such direct and immediate character that the intervenor will either
gain or lose by direct legal operation and effect of the judgment.17 Such interest must be actual, direct and material, and not simply contingent and
expectant.18
Petitioner claims that her status as the wife and companion of Tristan for 17 years vests her with the requisite legal interest required of a would-be intervenor
under the Rules of Court.
Petitioners claim lacks merit. Under the law, petitioner was never the legal wife of Tristan, hence her claim of legal interest has no basis.
When petitioner and Tristan married on July 14, 1984, Tristan was still lawfully married to Lily. The divorce decree that Tristan and Lily obtained from the
Dominican Republic never dissolved the marriage bond between them. It is basic that laws relating to family rights and duties, or to the status, condition and
legal capacity of persons are binding upon citizens of the Philippines, even though living abroad.19 Regardless of where a citizen of the Philippines might be,
he or she will be governed by Philippine laws with respect to his or her family rights and duties, or to his or her status, condition and legal capacity. Hence, if
a Filipino regardless of whether he or she was married here or abroad, initiates a petition abroad to obtain an absolute divorce from spouse and eventually
becomes successful in getting an absolute divorce decree, the Philippines will not recognize such absolute divorce.20
When Tristan and Lily married on May 18, 1968, their marriage was governed by the provisions of the Civil Code21 which took effect on August 30, 1950. In
the case of Tenchavez v. Escano22 we held:
(1) That a foreign divorce between Filipino citizens, sought and decreed after the effectivity of the present Civil Code (Rep. Act No. 386), is not entitled to
recognition as valid in this jurisdiction; and neither is the marriage contracted with another party by the divorced consort, subsequently to the foreign decree
of divorce, entitled to validity in the country. (Emphasis added)
Thus, petitioners claim that she is the wife of Tristan even if their marriage was celebrated abroad lacks merit. Thus, petitioner never acquired the legal
interest as a wife upon which her motion for intervention is based.
Since petitioners motion for leave to file intervention was bereft of the indispensable requirement of legal interest, the issuance by the trial court of the order
granting the same and admitting the complaint-in-intervention was attended with grave abuse of discretion. Consequently, the Court of Appeals correctly set
aside and declared as null and void the said order.
WHEREFORE, the petition is DISMISSED. The assailed Decision dated July 25, 2003 and Resolution dated January 23, 2004 of the Court of Appeals in CA-
G.R. SP No. 74456 are AFFIRMED.
No pronouncement as to costs.
66
SO ORDERED.
SAN LUIS VS SAN LUIS 2007
Before us are consolidated petitions for review assailing the February 4, 1998 Decision 1 of the Court of Appeals in CA-G.R. CV No. 52647, which reversed
and set aside the September 12, 1995 2 and January 31, 1996 3 Resolutions of the Regional Trial Court of Makati City, Branch 134 in SP. Proc. No. M-3708;
and its May 15, 1998 Resolution 4 denying petitioners motion for reconsideration.
The instant case involves the settlement of the estate of Felicisimo T. San Luis (Felicisimo), who was the former governor of the Province of Laguna. During
his lifetime, Felicisimo contracted three marriages. His first marriage was with Virginia Sulit on March 17, 1942 out of which were born six children, namely:
Rodolfo, Mila, Edgar, Linda, Emilita and Manuel. On August 11, 1963, Virginia predeceased Felicisimo.
Five years later, on May 1, 1968, Felicisimo married Merry Lee Corwin, with whom he had a son, Tobias. However, on October 15, 1971, Merry Lee, an
American citizen, filed a Complaint for Divorce 5 before the Family Court of the First Circuit, State of Hawaii, United States of America (U.S.A.), which issued
a Decree Granting Absolute Divorce and Awarding Child Custody on December 14, 1973. 6
On June 20, 1974, Felicisimo married respondent Felicidad San Luis, then surnamed Sagalongos, before Rev. Fr. William Meyer, Minister of the United
Presbyterian at Wilshire Boulevard, Los Angeles, California, U.S.A. 7 He had no children with respondent but lived with her for 18 years from the time of their
marriage up to his death on December 18, 1992.
Thereafter, respondent sought the dissolution of their conjugal partnership assets and the settlement of Felicisimos estate. On December 17, 1993, she filed
a petition for letters of administration 8 before the Regional Trial Court of Makati City, docketed as SP. Proc. No. M-3708 which was raffled to Branch 146
thereof.
Respondent alleged that she is the widow of Felicisimo; that, at the time of his death, the decedent was residing at 100 San Juanico Street, New Alabang
Village, Alabang, Metro Manila; that the decedents surviving heirs are respondent as legal spouse, his six children by his first marriage, and son by his second
marriage; that the decedent left real properties, both conjugal and exclusive, valued at P30,304,178.00 more or less; that the decedent does not have any
unpaid debts. Respondent prayed that the conjugal partnership assets be liquidated and that letters of administration be issued to her.
On February 4, 1994, petitioner Rodolfo San Luis, one of the children of Felicisimo by his first marriage, filed a motion to dismiss 9 on the grounds of improper
venue and failure to state a cause of action. Rodolfo claimed that the petition for letters of administration should have been filed in the Province of Laguna
because this was Felicisimos place of residence prior to his death. He further claimed that respondent has no legal personality to file the petition because
she was only a mistress of Felicisimo since the latter, at the time of his death, was still legally married to Merry Lee.
On February 15, 1994, Linda invoked the same grounds and joined her brother Rodolfo in seeking the dismissal 10 of the petition. On February 28, 1994, the
trial court issued an Order 11 denying the two motions to dismiss.
67
Unaware of the denial of the motions to dismiss, respondent filed on March 5, 1994 her opposition 12 thereto. She submitted documentary evidence showing
that while Felicisimo exercised the powers of his public office in Laguna, he regularly went home to their house in New Alabang Village, Alabang, Metro Manila
which they bought sometime in 1982. Further, she presented the decree of absolute divorce issued by the Family Court of the First Circuit, State of Hawaii to
prove that the marriage of Felicisimo to Merry Lee had already been dissolved. Thus, she claimed that Felicisimo had the legal capacity to marry her by virtue
of paragraph 2, 13 Article 26 of the Family Code and the doctrine laid down in Van Dorn v. Romillo, Jr. 14
Thereafter, Linda, Rodolfo and herein petitioner Edgar San Luis, separately filed motions for reconsideration from the Order denying their motions to dismiss.
15 They asserted that paragraph 2, Article 26 of the Family Code cannot be given retroactive effect to validate respondents bigamous marriage with Felicisimo
because this would impair vested rights in derogation of Article 256 16 of the Family Code.
On April 21, 1994, Mila, another daughter of Felicisimo from his first marriage, filed a motion to disqualify Acting Presiding Judge Anthony E. Santos from
hearing the case.
On October 24, 1994, the trial court issued an Order 17 denying the motions for reconsideration. It ruled that respondent, as widow of the decedent, possessed
the legal standing to file the petition and that venue was properly laid. Meanwhile, the motion for disqualification was deemed moot and academic 18 because
then Acting Presiding Judge Santos was substituted by Judge Salvador S. Tensuan pending the resolution of said motion.
Mila filed a motion for inhibition 19 against Judge Tensuan on November 16, 1994. On even date, Edgar also filed a motion for reconsideration 20 from the
Order denying their motion for reconsideration arguing that it does not state the facts and law on which it was based.
On November 25, 1994, Judge Tensuan issued an Order 21 granting the motion for inhibition. The case was re-raffled to Branch 134 presided by Judge Paul
T. Arcangel.
On April 24, 1995, 22 the trial court required the parties to submit their respective position papers on the twin issues of venue and legal capacity of respondent
to file the petition. On May 5, 1995, Edgar manifested 23 that he is adopting the arguments and evidence set forth in his previous motion for reconsideration
as his position paper. Respondent and Rodolfo filed their position papers on June 14, 24 and June 20, 25 1995, respectively.
On September 12, 1995, the trial court dismissed the petition for letters of administration. It held that, at the time of his death, Felicisimo was the duly elected
governor and a resident of the Province of Laguna. Hence, the petition should have been filed in Sta. Cruz, Laguna and not in Makati City. It also ruled that
respondent was without legal capacity to file the petition for letters of administration because her marriage with Felicisimo was bigamous, thus, void ab initio.
It found that the decree of absolute divorce dissolving Felicisimos marriage to Merry Lee was not valid in the Philippines and did not bind Felicisimo who was
a Filipino citizen. It also ruled that paragraph 2, Article 26 of the Family Code cannot be retroactively applied because it would impair the vested rights of
Felicisimos legitimate children.
Respondent moved for reconsideration 26 and for the disqualification 27 of Judge Arcangel but said motions were denied. 28
Respondent appealed to the Court of Appeals which reversed and set aside the orders of the trial court in its assailed Decision dated February 4, 1998, the
dispositive portion of which states:
68
WHEREFORE, the Orders dated September 12, 1995 and January 31, 1996 are hereby REVERSED and SET ASIDE; the Orders dated February 28 and
October 24, 1994 are REINSTATED; and the records of the case is REMANDED to the trial court for further proceedings. 29
The appellante court ruled that under Section 1, Rule 73 of the Rules of Court, the term "place of residence" of the decedent, for purposes of fixing the venue
of the settlement of his estate, refers to the personal, actual or physical habitation, or actual residence or place of abode of a person as distinguished from
legal residence or domicile. It noted that although Felicisimo discharged his functions as governor in Laguna, he actually resided in Alabang, Muntinlupa.
Thus, the petition for letters of administration was properly filed in Makati City.
The Court of Appeals also held that Felicisimo had legal capacity to marry respondent by virtue of paragraph 2, Article 26 of the Family Code and the rulings
in Van Dorn v. Romillo, Jr. 30 and Pilapil v. Ibay-Somera. 31 It found that the marriage between Felicisimo and Merry Lee was validly dissolved by virtue of
the decree of absolute divorce issued by the Family Court of the First Circuit, State of Hawaii. As a result, under paragraph 2, Article 26, Felicisimo was
capacitated to contract a subsequent marriage with respondent. Thus
With the well-known rule express mandate of paragraph 2, Article 26, of the Family Code of the Philippines, the doctrines in Van Dorn, Pilapil, and the
reason and philosophy behind the enactment of E.O. No. 227, there is no justiciable reason to sustain the individual view sweeping statement of
Judge Arc[h]angel, that "Article 26, par. 2 of the Family Code, contravenes the basic policy of our state against divorce in any form whatsoever." Indeed,
courts cannot deny what the law grants. All that the courts should do is to give force and effect to the express mandate of the law. The foreign divorce having
been obtained by the Foreigner on December 14, 1992, 32 the Filipino divorcee, "shall x x x have capacity to remarry under Philippine laws". For this reason,
the marriage between the deceased and petitioner should not be denominated as "a bigamous marriage.
Therefore, under Article 130 of the Family Code, the petitioner as the surviving spouse can institute the judicial proceeding for the settlement of the estate of
the deceased. x x x 33
Edgar, Linda, and Rodolfo filed separate motions for reconsideration 34 which were denied by the Court of Appeals.
On July 2, 1998, Edgar appealed to this Court via the instant petition for review on certiorari. 35 Rodolfo later filed a manifestation and motion to adopt the
said petition which was granted. 36
In the instant consolidated petitions, Edgar and Rodolfo insist that the venue of the subject petition for letters of administration was improperly laid because
at the time of his death, Felicisimo was a resident of Sta. Cruz, Laguna. They contend that pursuant to our rulings in Nuval v. Guray 37 and Romualdez v.
RTC, Br. 7, Tacloban City, 38 "residence" is synonymous with "domicile" which denotes a fixed permanent residence to which when absent, one intends to
return. They claim that a person can only have one domicile at any given time. Since Felicisimo never changed his domicile, the petition for letters of
administration should have been filed in Sta. Cruz, Laguna.
Petitioners also contend that respondents marriage to Felicisimo was void and bigamous because it was performed during the subsistence of the latters
marriage to Merry Lee. They argue that paragraph 2, Article 26 cannot be retroactively applied because it would impair vested rights and ratify the void
69
bigamous marriage. As such, respondent cannot be considered the surviving wife of Felicisimo; hence, she has no legal capacity to file the petition for letters
of administration.
The issues for resolution: (1) whether venue was properly laid, and (2) whether respondent has legal capacity to file the subject petition for letters of
administration.
Under Section 1, 39 Rule 73 of the Rules of Court, the petition for letters of administration of the estate of Felicisimo should be filed in the Regional Trial Court
of the province "in which he resides at the time of his death." In the case of Garcia Fule v. Court of Appeals, 40 we laid down the doctrinal rule for determining
the residence as contradistinguished from domicile of the decedent for purposes of fixing the venue of the settlement of his estate:
[T]he term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or domicile." This term "resides," like the terms "residing"
and "residence," is elastic and should be interpreted in the light of the object or purpose of the statute or rule in which it is employed. In the application of
venue statutes and rules Section 1, Rule 73 of the Revised Rules of Court is of such nature residence rather than domicile is the significant factor. Even
where the statute uses the word "domicile" still it is construed as meaning residence and not domicile in the technical sense. Some cases make a distinction
between the terms "residence" and "domicile" but as generally used in statutes fixing venue, the terms are synonymous, and convey the same meaning as
the term "inhabitant." In other words, "resides" should be viewed or understood in its popular sense, meaning, the personal, actual or physical habitation of a
person, actual residence or place of abode. It signifies physical presence in a place and actual stay thereat. In this popular sense, the term means merely
residence, that is, personal residence, not legal residence or domicile. Residence simply requires bodily presence as an inhabitant in a given place, while
domicile requires bodily presence in that place and also an intention to make it ones domicile. No particular length of time of residence is required though;
however, the residence must be more than temporary. 41 (Emphasis supplied)
It is incorrect for petitioners to argue that "residence," for purposes of fixing the venue of the settlement of the estate of Felicisimo, is synonymous with
"domicile." The rulings in Nuval and Romualdez are inapplicable to the instant case because they involve election cases. Needless to say, there is a distinction
between "residence" for purposes of election laws and "residence" for purposes of fixing the venue of actions. In election cases, "residence" and "domicile"
are treated as synonymous terms, that is, the fixed permanent residence to which when absent, one has the intention of returning. 42 However, for purposes
of fixing venue under the Rules of Court, the "residence" of a person is his personal, actual or physical habitation, or actual residence or place of abode, which
may not necessarily be his legal residence or domicile provided he resides therein with continuity and consistency. 43 Hence, it is possible that a person may
have his residence in one place and domicile in another.
In the instant case, while petitioners established that Felicisimo was domiciled in Sta. Cruz, Laguna, respondent proved that he also maintained a residence
in Alabang, Muntinlupa from 1982 up to the time of his death. Respondent submitted in evidence the Deed of Absolute Sale 44 dated January 5, 1983 showing
that the deceased purchased the aforesaid property. She also presented billing statements 45 from the Philippine Heart Center and Chinese General Hospital
for the period August to December 1992 indicating the address of Felicisimo at "100 San Juanico, Ayala Alabang, Muntinlupa." Respondent also presented
proof of membership of the deceased in the Ayala Alabang Village Association 46 and Ayala Country Club, Inc., 47 letter-envelopes 48 from 1988 to 1990
sent by the deceaseds children to him at his Alabang address, and the deceaseds calling cards 49 stating that his home/city address is at "100 San Juanico,
Ayala Alabang Village, Muntinlupa" while his office/provincial address is in "Provincial Capitol, Sta. Cruz, Laguna."
70
From the foregoing, we find that Felicisimo was a resident of Alabang, Muntinlupa for purposes of fixing the venue of the settlement of his estate. Consequently,
the subject petition for letters of administration was validly filed in the Regional Trial Court 50 which has territorial jurisdiction over Alabang, Muntinlupa. The
subject petition was filed on December 17, 1993. At that time, Muntinlupa was still a municipality and the branches of the Regional Trial Court of the National
Capital Judicial Region which had territorial jurisdiction over Muntinlupa were then seated in Makati City as per Supreme Court Administrative Order No. 3.
51 Thus, the subject petition was validly filed before the Regional Trial Court of Makati City.
Anent the issue of respondent Felicidads legal personality to file the petition for letters of administration, we must first resolve the issue of whether a Filipino
who is divorced by his alien spouse abroad may validly remarry under the Civil Code, considering that Felicidads marriage to Felicisimo was solemnized on
June 20, 1974, or before the Family Code took effect on August 3, 1988. In resolving this issue, we need not retroactively apply the provisions of the Family
Code, particularly Art. 26, par. (2) considering that there is sufficient jurisprudential basis allowing us to rule in the affirmative.
The case of Van Dorn v. Romillo, Jr. 52 involved a marriage between a foreigner and his Filipino wife, which marriage was subsequently dissolved through a
divorce obtained abroad by the latter. Claiming that the divorce was not valid under Philippine law, the alien spouse alleged that his interest in the properties
from their conjugal partnership should be protected. The Court, however, recognized the validity of the divorce and held that the alien spouse had no interest
in the properties acquired by the Filipino wife after the divorce. Thus:
In this case, the divorce in Nevada released private respondent from the marriage from the standards of American law, under which divorce dissolves the
marriage. As stated by the Federal Supreme Court of the United States in Atherton vs. Atherton, 45 L. Ed. 794, 799:
"The purpose and effect of a decree of divorce from the bond of matrimony by a competent jurisdiction are to change the existing status or domestic relation
of husband and wife, and to free them both from the bond. The marriage tie, when thus severed as to one party, ceases to bind either. A husband without a
wife, or a wife without a husband, is unknown to the law. When the law provides, in the nature of a penalty, that the guilty party shall not marry again, that
party, as well as the other, is still absolutely freed from the bond of the former marriage."
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would have no standing to sue in the case below as petitioners
husband entitled to exercise control over conjugal assets. As he is bound by the Decision of his own countrys Court, which validly exercised jurisdiction over
him, and whose decision he does not repudiate, he is estopped by his own representation before said Court from asserting his right over the alleged conjugal
property. 53
As to the effect of the divorce on the Filipino wife, the Court ruled that she should no longer be considered married to the alien spouse. Further, she should
not be required to perform her marital duties and obligations. It held:
To maintain, as private respondent does, that, under our laws, petitioner has to be considered still married to private respondent and still subject to a wife's
obligations under Article 109, et. seq. of the Civil Code cannot be just. Petitioner should not be obliged to live together with, observe respect and fidelity, and
render support to private respondent. The latter should not continue to be one of her heirs with possible rights to conjugal property. She should not be
discriminated against in her own country if the ends of justice are to be served. 54 (Emphasis added)
71
This principle was thereafter applied in Pilapil v. Ibay-Somera 55 where the Court recognized the validity of a divorce obtained abroad. In the said case, it was
held that the alien spouse is not a proper party in filing the adultery suit against his Filipino wife. The Court stated that "the severance of the marital bond had
the effect of dissociating the former spouses from each other, hence the actuations of one would not affect or cast obloquy on the other." 56
Likewise, in Quita v. Court of Appeals, 57 the Court stated that where a Filipino is divorced by his naturalized foreign spouse, the ruling in Van Dorn applies.
58 Although decided on December 22, 1998, the divorce in the said case was obtained in 1954 when the Civil Code provisions were still in effect.
The significance of the Van Dorn case to the development of limited recognition of divorce in the Philippines cannot be denied. The ruling has long been
interpreted as severing marital ties between parties in a mixed marriage and capacitating the Filipino spouse to remarry as a necessary consequence of
upholding the validity of a divorce obtained abroad by the alien spouse. In his treatise, Dr. Arturo M. Tolentino cited Van Dorn stating that "if the foreigner
obtains a valid foreign divorce, the Filipino spouse shall have capacity to remarry under Philippine law." 59 In Garcia v. Recio, 60 the Court likewise cited the
aforementioned case in relation to Article 26. 61
In the recent case of Republic v. Orbecido III, 62 the historical background and legislative intent behind paragraph 2, Article 26 of the Family Code were
discussed, to wit:
Brief Historical Background
On July 6, 1987, then President Corazon Aquino signed into law Executive Order No. 209, otherwise known as the "Family Code," which took effect on August
3, 1988. Article 26 thereof states:
All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized, and valid there as such,
shall also be valid in this country, except those prohibited under Articles 35, 37, and 38.
On July 17, 1987, shortly after the signing of the original Family Code, Executive Order No. 227 was likewise signed into law, amending Articles 26, 36, and
39 of the Family Code. A second paragraph was added to Article 26. As so amended, it now provides:
ART. 26. All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized, and valid there as
such, shall also be valid in this country, except those prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse
capacitating him or her to remarry, the Filipino spouse shall have capacity to remarry under Philippine law. (Emphasis supplied)
xxxx
Legislative Intent
72
Records of the proceedings of the Family Code deliberations showed that the intent of Paragraph 2 of Article 26, according to Judge Alicia Sempio-Diy, a
member of the Civil Code Revision Committee, is to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who, after
obtaining a divorce, is no longer married to the Filipino spouse.
Interestingly, Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn v. Romillo, Jr. The Van Dorn case involved a marriage between a Filipino
citizen and a foreigner. The Court held therein that a divorce decree validly obtained by the alien spouse is valid in the Philippines, and consequently, the
Filipino spouse is capacitated to remarry under Philippine law. 63 (Emphasis added)
As such, the Van Dorn case is sufficient basis in resolving a situation where a divorce is validly obtained abroad by the alien spouse. With the enactment of
the Family Code and paragraph 2, Article 26 thereof, our lawmakers codified the law already established through judicial precedent.1awphi1.net
Indeed, when the object of a marriage is defeated by rendering its continuance intolerable to one of the parties and productive of no possible good to the
community, relief in some way should be obtainable. 64 Marriage, being a mutual and shared commitment between two parties, cannot possibly be productive
of any good to the society where one is considered released from the marital bond while the other remains bound to it. Such is the state of affairs where the
alien spouse obtains a valid divorce abroad against the Filipino spouse, as in this case.
Petitioners cite Articles 15 65 and 17 66 of the Civil Code in stating that the divorce is void under Philippine law insofar as Filipinos are concerned. However,
in light of this Courts rulings in the cases discussed above, the Filipino spouse should not be discriminated against in his own country if the ends of justice
are to be served. 67 In Alonzo v. Intermediate Appellate Court, 68 the Court stated:
But as has also been aptly observed, we test a law by its results; and likewise, we may add, by its purposes. It is a cardinal rule that, in seeking the meaning
of the law, the first concern of the judge should be to discover in its provisions the intent of the lawmaker. Unquestionably, the law should never be interpreted
in such a way as to cause injustice as this is never within the legislative intent. An indispensable part of that intent, in fact, for we presume the good motives
of the legislature, is to render justice.
Thus, we interpret and apply the law not independently of but in consonance with justice. Law and justice are inseparable, and we must keep them so. To be
sure, there are some laws that, while generally valid, may seem arbitrary when applied in a particular case because of its peculiar circumstances. In such a
situation, we are not bound, because only of our nature and functions, to apply them just the same, in slavish obedience to their language. What we do instead
is find a balance between the word and the will, that justice may be done even as the law is obeyed.
As judges, we are not automatons. We do not and must not unfeelingly apply the law as it is worded, yielding like robots to the literal command without regard
to its cause and consequence. "Courts are apt to err by sticking too closely to the words of a law," so we are warned, by Justice Holmes again, "where these
words import a policy that goes beyond them."
xxxx
More than twenty centuries ago, Justinian defined justice "as the constant and perpetual wish to render every one his due." That wish continues to motivate
this Court when it assesses the facts and the law in every case brought to it for decision. Justice is always an essential ingredient of its decisions. Thus when
73
the facts warrants, we interpret the law in a way that will render justice, presuming that it was the intention of the lawmaker, to begin with, that the law be
dispensed with justice. 69
Applying the above doctrine in the instant case, the divorce decree allegedly obtained by Merry Lee which absolutely allowed Felicisimo to remarry, would
have vested Felicidad with the legal personality to file the present petition as Felicisimos surviving spouse. However, the records show that there is insufficient
evidence to prove the validity of the divorce obtained by Merry Lee as well as the marriage of respondent and Felicisimo under the laws of the U.S.A. In Garcia
v. Recio, 70 the Court laid down the specific guidelines for pleading and proving foreign law and divorce judgments. It held that presentation solely of the
divorce decree is insufficient and that proof of its authenticity and due execution must be presented. Under Sections 24 and 25 of Rule 132, a writing or
document may be proven as a public or official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by the officer having
legal custody of the document. If the record is not kept in the Philippines, such copy must be (a) accompanied by a certificate issued by the proper diplomatic
or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office.
71
With regard to respondents marriage to Felicisimo allegedly solemnized in California, U.S.A., she submitted photocopies of the Marriage Certificate and the
annotated text 72 of the Family Law Act of California which purportedly show that their marriage was done in accordance with the said law. As stated in
Garcia, however, the Court cannot take judicial notice of foreign laws as they must be alleged and proved. 73
Therefore, this case should be remanded to the trial court for further reception of evidence on the divorce decree obtained by Merry Lee and the marriage of
respondent and Felicisimo.
Even assuming that Felicisimo was not capacitated to marry respondent in 1974, nevertheless, we find that the latter has the legal personality to file the
subject petition for letters of administration, as she may be considered the co-owner of Felicisimo as regards the properties that were acquired through their
joint efforts during their cohabitation.
Section 6, 74 Rule 78 of the Rules of Court states that letters of administration may be granted to the surviving spouse of the decedent. However, Section 2,
Rule 79 thereof also provides in part:
SEC. 2. Contents of petition for letters of administration. A petition for letters of administration must be filed by an interested person and must show, as far
as known to the petitioner: x x x.
An "interested person" has been defined as one who would be benefited by the estate, such as an heir, or one who has a claim against the estate, such as a
creditor. The interest must be material and direct, and not merely indirect or contingent. 75
In the instant case, respondent would qualify as an interested person who has a direct interest in the estate of Felicisimo by virtue of their cohabitation, the
existence of which was not denied by petitioners. If she proves the validity of the divorce and Felicisimos capacity to remarry, but fails to prove that her
marriage with him was validly performed under the laws of the U.S.A., then she may be considered as a co-owner under Article 144 76 of the Civil Code. This
provision governs the property relations between parties who live together as husband and wife without the benefit of marriage, or their marriage is void from
the beginning. It provides that the property acquired by either or both of them through their work or industry or their wages and salaries shall be governed by
74
the rules on co-ownership. In a co-ownership, it is not necessary that the property be acquired through their joint labor, efforts and industry. Any property
acquired during the union is prima facie presumed to have been obtained through their joint efforts. Hence, the portions belonging to the co-owners shall be
presumed equal, unless the contrary is proven. 77
Meanwhile, if respondent fails to prove the validity of both the divorce and the marriage, the applicable provision would be Article 148 of the Family Code
which has filled the hiatus in Article 144 of the Civil Code by expressly regulating the property relations of couples living together as husband and wife but are
incapacitated to marry. 78 In Saguid v. Court of Appeals, 79 we held that even if the cohabitation or the acquisition of property occurred before the Family
Code took effect, Article 148 governs. 80 The Court described the property regime under this provision as follows:
The regime of limited co-ownership of property governing the union of parties who are not legally capacitated to marry each other, but who nonetheless live
together as husband and wife, applies to properties acquired during said cohabitation in proportion to their respective contributions. Co-ownership will only
be up to the extent of the proven actual contribution of money, property or industry. Absent proof of the extent thereof, their contributions and corresponding
shares shall be presumed to be equal.
xxxx
In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue of co-ownership of properties acquired by the parties to a bigamous
marriage and an adulterous relationship, respectively, we ruled that proof of actual contribution in the acquisition of the property is essential. x x x
As in other civil cases, the burden of proof rests upon the party who, as determined by the pleadings or the nature of the case, asserts an affirmative issue.
Contentions must be proved by competent evidence and reliance must be had on the strength of the partys own evidence and not upon the weakness of the
opponents defense. x x x 81
In view of the foregoing, we find that respondents legal capacity to file the subject petition for letters of administration may arise from her status as the
surviving wife of Felicisimo or as his co-owner under Article 144 of the Civil Code or Article 148 of the Family Code.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals reinstating and affirming the February 28, 1994 Order of the Regional Trial Court
which denied petitioners motion to dismiss and its October 24, 1994 Order which dismissed petitioners motion for reconsideration is AFFIRMED. Let this
case be REMANDED to the trial court for further proceedings.
SO ORDERED.
LAVADIA VS HEIRS OF LUNA 2014
Divorce between Filipinos is void and ineffectual under the nationality rule adopted by Philippine law. Hence, any settlement of property between the parties
of the first marriage involving Filipinos submitted as an incident of a divorce obtained in a foreign country lacks competent judicial approval, and cannot be
enforceable against the assets of the husband who contracts a subsequent marriage.
75
The Case
The petitioner, the second wife of the late Atty. Juan Luces Luna, appeals the adverse decision promulgated on November 11, 2005,1 whereby the Court of
Appeals (CA) affirmed with modification the decision rendered on August 27, 2001 by the Regional Trial Court (RTC), Branch 138, in Makati City.2 The CA
thereby denied her right in the 25/100 pro indiviso share of the husband in a condominium unit, and in the law books of the husband acquired during the
second marriage.
Antecedents
The antecedent facts were summarized by the CA as follows:
ATTY. LUNA, a practicing lawyer, was at first a name partner in the prestigious law firm Sycip, Salazar, Luna, Manalo, Hernandez & Feliciano Law Offices at
that time when he was living with his first wife, herein intervenor-appellant Eugenia Zaballero-Luna (EUGENIA), whom he initially married ina civil ceremony
conducted by the Justice of the Peace of Paraaque, Rizal on September 10, 1947 and later solemnized in a church ceremony at the Pro-Cathedral in San
Miguel, Bulacan on September 12, 1948. In ATTY. LUNAs marriage to EUGENIA, they begot seven (7) children, namely: Regina Maria L. Nadal, Juan Luis
Luna, Araceli Victoria L. Arellano, Ana Maria L. Tabunda, Gregorio Macario Luna, Carolina Linda L. Tapia, and Cesar Antonio Luna. After almost two (2)
decades of marriage, ATTY. LUNA and EUGENIA eventually agreed to live apart from each other in February 1966 and agreed to separation of property, to
which end, they entered into a written agreement entitled "AGREEMENT FOR SEPARATION AND PROPERTY SETTLEMENT" dated November 12, 1975,
whereby they agreed to live separately and to dissolve and liquidate their conjugal partnership of property.
On January 12, 1976, ATTY. LUNA obtained a divorce decree of his marriage with EUGENIA from the Civil and Commercial Chamber of the First
Circumscription of the Court of First Instance of Sto. Domingo, Dominican Republic. Also in Sto.Domingo, Dominican Republic, on the same date, ATTY.
LUNA contracted another marriage, this time with SOLEDAD. Thereafter, ATTY. LUNA and SOLEDAD returned to the Philippines and lived together as
husband and wife until 1987.
Sometime in 1977, ATTY. LUNA organized a new law firm named: Luna, Puruganan, Sison and Ongkiko (LUPSICON) where ATTY. LUNA was the managing
partner.
On February 14, 1978, LUPSICON through ATTY. LUNA purchased from Tandang Sora Development Corporation the 6th Floor of Kalaw-Ledesma
Condominium Project(condominium unit) at Gamboa St., Makati City, consisting of 517.52 square meters, for P1,449,056.00, to be paid on installment basis
for 36months starting on April 15, 1978. Said condominium unit was to be usedas law office of LUPSICON. After full payment, the Deed of Absolute Sale over
the condominium unit was executed on July 15, 1983, and CCT No. 4779 was issued on August 10, 1983, which was registered bearing the following names:
"JUAN LUCES LUNA, married to Soledad L. Luna (46/100); MARIO E. ONGKIKO, married to Sonia P.G. Ongkiko (25/100); GREGORIO R. PURUGANAN,
married to Paz A. Puruganan (17/100); and TERESITA CRUZ SISON, married to Antonio J.M. Sison (12/100) x x x" Subsequently, 8/100 share of ATTY.
LUNA and 17/100 share of Atty. Gregorio R. Puruganan in the condominium unit was sold to Atty. Mario E. Ongkiko, for which a new CCT No. 21761 was
issued on February 7, 1992 in the following names:
76
"JUAN LUCES LUNA, married to Soledad L. Luna (38/100); MARIO E. ONGKIKO, married to Sonia P.G. Ongkiko (50/100); TERESITA CRUZ SISON, married
to Antonio J.M. Sison (12/100) x x x"
Sometime in 1992, LUPSICON was dissolved and the condominium unit was partitioned by the partners but the same was still registered in common under
CCT No. 21716. The parties stipulated that the interest of ATTY. LUNA over the condominium unit would be 25/100 share. ATTY. LUNA thereafter established
and headed another law firm with Atty. Renato G. Dela Cruzand used a portion of the office condominium unit as their office. The said law firm lasted until the
death of ATTY. JUAN on July 12, 1997.
After the death of ATTY. JUAN, his share in the condominium unit including the lawbooks, office furniture and equipment found therein were taken over by
Gregorio Z. Luna, ATTY. LUNAs son of the first marriage. Gregorio Z. Luna thenleased out the 25/100 portion of the condominium unit belonging to his father
to Atty. Renato G. De la Cruz who established his own law firm named Renato G. De la Cruz & Associates.
The 25/100 pro-indiviso share of ATTY. Luna in the condominium unit as well as the law books, office furniture and equipment became the subject of the
complaint filed by SOLEDAD against the heirs of ATTY. JUAN with the RTC of Makati City, Branch 138, on September 10, 1999, docketed as Civil Case No.
99-1644. The complaint alleged that the subject properties were acquired during the existence of the marriage between ATTY. LUNA and SOLEDAD through
their joint efforts that since they had no children, SOLEDAD became co-owner of the said properties upon the death of ATTY. LUNA to the extent of pro-
indiviso share consisting of her share in the said properties plus her share in the net estate of ATTY. LUNA which was bequeathed to her in the latters
last will and testament; and thatthe heirs of ATTY. LUNA through Gregorio Z. Luna excluded SOLEDAD from her share in the subject properties. The complaint
prayed that SOLEDAD be declared the owner of the portion of the subject properties;that the same be partitioned; that an accounting of the rentals on the
condominium unit pertaining to the share of SOLEDAD be conducted; that a receiver be appointed to preserve ad administer the subject properties;and that
the heirs of ATTY. LUNA be ordered to pay attorneys feesand costs of the suit to SOLEDAD.3
Ruling of the RTC
On August 27, 2001, the RTC rendered its decision after trial upon the aforementioned facts,4 disposing thusly:
WHEREFORE, judgment is rendered as follows:
(a) The 24/100 pro-indiviso share in the condominium unit located at the SIXTH FLOOR of the KALAW LEDESMA CONDOMINIUM PROJECT covered by
Condominium Certificate of Title No. 21761 consisting of FIVE HUNDRED SEVENTEEN (517/100) SQUARE METERS is adjudged to have been acquired
by Juan Lucas Luna through his sole industry;
(b) Plaintiff has no right as owner or under any other concept over the condominium unit, hence the entry in Condominium Certificate of Title No. 21761 of the
Registry of Deeds of Makati with respect to the civil status of Juan Luces Luna should be changed from "JUAN LUCES LUNA married to Soledad L. Luna" to
"JUAN LUCES LUNA married to Eugenia Zaballero Luna";
77
(c) Plaintiff is declared to be the owner of the books Corpus Juris, Fletcher on Corporation, American Jurisprudence and Federal Supreme Court Reports
found in the condominium unit and defendants are ordered to deliver them to the plaintiff as soon as appropriate arrangements have been madefor transport
and storage.
SO ORDERED.5
Decision of the CA
Both parties appealed to the CA.6
On her part, the petitioner assigned the following errors to the RTC, namely:
I. THE LOWER COURT ERRED IN RULING THAT THE CONDOMINIUM UNIT WAS ACQUIRED THRU THE SOLE INDUSTRY OF ATTY. JUAN LUCES
LUNA;
II. THE LOWER COURT ERRED IN RULING THAT PLAINTIFFAPPELLANT DID NOT CONTRIBUTE MONEY FOR THE ACQUISITION OF THE
CONDOMINIUM UNIT;
III. THE LOWER COURT ERRED IN GIVING CREDENCE TO PORTIONS OF THE TESTIMONY OF GREGORIO LUNA, WHO HAS NO ACTUAL
KNOWLEDGE OF THE ACQUISITION OF THE UNIT, BUT IGNORED OTHER PORTIONS OF HIS TESTIMONY FAVORABLE TO THE PLAINTIFF-
APPELLANT;
IV. THE LOWER COURT ERRED IN NOT GIVING SIGNIFICANCE TO THE FACT THAT THE CONJUGAL PARTNERSHIP BETWEEN LUNA AND
INTERVENOR-APPELLANT WAS ALREADY DISSOLVED AND LIQUIDATED PRIOR TO THE UNION OF PLAINTIFF-APPELLANT AND LUNA;
V. THE LOWER COURT ERRED IN GIVING UNDUE SIGNIFICANCE TO THE ABSENCE OF THE DISPOSITION OF THE CONDOMINIUM UNIT IN THE
HOLOGRAPHIC WILL OF THE PLAINTIFF-APPELLANT;
VI. THE LOWER COURT ERRED IN GIVING UNDUE SIGNIFICANCE TO THE FACTTHAT THE NAME OF PLAINTIFF-APPELLANT DID NOT APPEAR IN
THE DEED OF ABSOLUTE SALE EXECUTED BY TANDANG SORA DEVELOPMENT CORPORATION OVER THE CONDOMINIUM UNIT;
VII. THE LOWER COURT ERRED IN RULING THAT NEITHER ARTICLE 148 OF THE FAMILYCODE NOR ARTICLE 144 OF THE CIVIL CODE OF THE
PHILIPPINES ARE APPLICABLE;
VIII. THE LOWER COURT ERRED IN NOT RULING THAT THE CAUSE OF ACTION OF THE INTERVENOR-APPELLANT HAS BEEN BARRED BY
PESCRIPTION AND LACHES; and
78
IX. THE LOWER COURT ERRED IN NOT EXPUNGING/DISMISSING THE INTERVENTION FOR FAILURE OF INTERVENOR-APPELLANT TO PAY
FILING FEE.7
In contrast, the respondents attributedthe following errors to the trial court, to wit:
I. THE LOWER COURT ERRED IN HOLDING THAT CERTAIN FOREIGN LAW BOOKS IN THE LAW OFFICE OF ATTY. LUNA WERE BOUGHT WITH THE
USE OF PLAINTIFFS MONEY;
II. THE LOWER COURT ERRED IN HOLDING THAT PLAINTIFF PROVED BY PREPONDERANCE OF EVIDENCE (HER CLAIM OVER) THE SPECIFIED
FOREIGN LAW BOOKS FOUND IN ATTY. LUNAS LAW OFFICE; and
III. THE LOWER COURT ERRED IN NOT HOLDING THAT, ASSUMING PLAINTIFF PAID FOR THE SAID FOREIGN LAW BOOKS, THE RIGHT TO
RECOVER THEM HAD PRESCRIBED AND BARRED BY LACHES AND ESTOPPEL.8
On November 11, 2005, the CA promulgated its assailed modified decision,9 holding and ruling:
EUGENIA, the first wife, was the legitimate wife of ATTY. LUNA until the latters death on July 12, 1997. The absolute divorce decree obtained by ATTY.
LUNA inthe Dominican Republic did not terminate his prior marriage with EUGENIA because foreign divorce between Filipino citizens is not recognized in our
jurisdiction. x x x10
xxxx
WHEREFORE, premises considered, the assailed August 27, 2001 Decision of the RTC of MakatiCity, Branch 138, is hereby MODIFIEDas follows:
(a) The 25/100 pro-indiviso share in the condominium unit at the SIXTH FLOOR of the KALAW LEDESMA CONDOMINIUM PROJECT covered by
Condominium Certificate of Title No. 21761 consisting of FIVE HUNDRED SEVENTEEN (517/100) (sic) SQUARE METERS is hereby adjudged to defendants-
appellants, the heirs of Juan Luces Luna and Eugenia Zaballero-Luna (first marriage), having been acquired from the sole funds and sole industry of Juan
Luces Luna while marriage of Juan Luces Luna and Eugenia Zaballero-Luna (first marriage) was still subsisting and valid;
(b) Plaintiff-appellant Soledad Lavadia has no right as owner or under any other concept over the condominium unit, hence the entry in Condominium
Certificate of Title No. 21761 of the Registry of Deeds ofMakati with respect to the civil status of Juan Luces Luna should be changed from "JUAN LUCES
LUNA married to Soledad L. Luna" to "JUAN LUCES LUNA married to Eugenia Zaballero Luna";
(c) Defendants-appellants, the heirs of Juan Luces Luna and Eugenia Zaballero-Luna(first marriage) are hereby declared to be the owner of the books Corpus
Juris, Fletcher on Corporation, American Jurisprudence and Federal Supreme Court Reports found in the condominium unit.
79
SO ORDERED.11
On March 13, 2006,12 the CA denied the petitioners motion for reconsideration.13
Issues
In this appeal, the petitioner avers in her petition for review on certiorarithat:
A. The Honorable Court of Appeals erred in ruling that the Agreement for Separation and Property Settlement executed by Luna and Respondent Eugenia
was unenforceable; hence, their conjugal partnership was not dissolved and liquidated;
B. The Honorable Court of Appeals erred in not recognizing the Dominican Republic courts approval of the Agreement;
C. The Honorable Court of Appeals erred in ruling that Petitioner failed to adduce sufficient proof of actual contribution to the acquisition of purchase of the
subjectcondominium unit; and
D. The Honorable Court of Appeals erred in ruling that Petitioner was not entitled to the subject law books.14
The decisive question to be resolved is who among the contending parties should be entitled to the 25/100 pro indivisoshare in the condominium unit; and to
the law books (i.e., Corpus Juris, Fletcher on Corporation, American Jurisprudence and Federal Supreme Court Reports).
The resolution of the decisive question requires the Court to ascertain the law that should determine, firstly, whether the divorce between Atty. Luna and
Eugenia Zaballero-Luna (Eugenia) had validly dissolved the first marriage; and, secondly, whether the second marriage entered into by the late Atty. Luna
and the petitioner entitled the latter to any rights in property. Ruling of the Court
We affirm the modified decision of the CA.
1. Atty. Lunas first marriage with Eugenia

subsisted up to the time of his death
The first marriage between Atty. Luna and Eugenia, both Filipinos, was solemnized in the Philippines on September 10, 1947. The law in force at the time of
the solemnization was the Spanish Civil Code, which adopted the nationality rule. The Civil Codecontinued to follow the nationality rule, to the effect that
Philippine laws relating to family rights and duties, or to the status, condition and legal capacity of persons were binding upon citizens of the Philippines,
although living abroad.15 Pursuant to the nationality rule, Philippine laws governed thiscase by virtue of bothAtty. Luna and Eugenio having remained Filipinos
until the death of Atty. Luna on July 12, 1997 terminated their marriage.
80
From the time of the celebration ofthe first marriage on September 10, 1947 until the present, absolute divorce between Filipino spouses has not been
recognized in the Philippines. The non-recognition of absolute divorce between Filipinos has remained even under the Family Code,16 even if either or both
of the spouses are residing abroad.17 Indeed, the only two types of defective marital unions under our laws have beenthe void and the voidable marriages.
As such, the remedies against such defective marriages have been limited to the declaration of nullity ofthe marriage and the annulment of the marriage.
It is true that on January 12, 1976, the Court of First Instance (CFI) of Sto. Domingo in the Dominican Republic issued the Divorce Decree dissolving the first
marriage of Atty. Luna and Eugenia.18 Conformably with the nationality rule, however, the divorce, even if voluntarily obtained abroad, did not dissolve the
marriage between Atty. Luna and Eugenia, which subsisted up to the time of his death on July 12, 1997. This finding conforms to the Constitution, which
characterizes marriage as an inviolable social institution,19 and regards it as a special contract of permanent union between a man and a woman for the
establishment of a conjugal and family life.20 The non-recognition of absolute divorce in the Philippines is a manifestation of the respect for the sanctity of the
marital union especially among Filipino citizens. It affirms that the extinguishment of a valid marriage must be grounded only upon the death of either spouse,
or upon a ground expressly provided bylaw. For as long as this public policy on marriage between Filipinos exists, no divorce decree dissolving the marriage
between them can ever be given legal or judicial recognition and enforcement in this jurisdiction.
2. The Agreement for Separation and Property Settlement

was void for lack of court approval
The petitioner insists that the Agreement for Separation and Property Settlement (Agreement) that the late Atty. Luna and Eugenia had entered into and
executed in connection with the divorce proceedings before the CFI of Sto. Domingo in the Dominican Republic to dissolve and liquidate their conjugal
partnership was enforceable against Eugenia. Hence, the CA committed reversible error in decreeing otherwise.
The insistence of the petitioner was unwarranted.
Considering that Atty. Luna and Eugenia had not entered into any marriage settlement prior to their marriage on September 10, 1947, the system of relative
community or conjugal partnership of gains governed their property relations. This is because the Spanish Civil Code, the law then in force at the time of their
marriage, did not specify the property regime of the spouses in the event that they had not entered into any marriage settlement before or at the time of the
marriage. Article 119 of the Civil Codeclearly so provides, to wit:
Article 119. The future spouses may in the marriage settlements agree upon absolute or relative community of property, or upon complete separation of
property, or upon any other regime. In the absence of marriage settlements, or when the same are void, the system of relative community or conjugal
partnership of gains as established in this Code, shall govern the property relations between husband and wife.
Article 142 of the Civil Codehas defined a conjugal partnership of gains thusly:
Article 142. By means of the conjugal partnership of gains the husband and wife place in a common fund the fruits of their separate property and the income
from their work or industry, and divide equally, upon the dissolution of the marriage or of the partnership, the net gains or benefits obtained indiscriminately
by either spouse during the marriage.
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The conjugal partnership of gains subsists until terminated for any of various causes of termination enumerated in Article 175 of the Civil Code, viz:
Article 175. The conjugal partnership of gains terminates:
(1) Upon the death of either spouse;
(2) When there is a decree of legal separation;
(3) When the marriage is annulled;
(4) In case of judicial separation of property under Article 191.
The mere execution of the Agreement by Atty. Luna and Eugenia did not per sedissolve and liquidate their conjugal partnership of gains. The approval of the
Agreement by a competent court was still required under Article 190 and Article 191 of the Civil Code, as follows:
Article 190. In the absence of an express declaration in the marriage settlements, the separation of property between spouses during the marriage shall not
take place save in virtue of a judicial order. (1432a)
Article 191. The husband or the wife may ask for the separation of property, and it shall be decreed when the spouse of the petitioner has been sentenced to
a penalty which carries with it civil interdiction, or has been declared absent, or when legal separation has been granted.
xxxx
The husband and the wife may agree upon the dissolution of the conjugal partnership during the marriage, subject to judicial approval. All the creditors of the
husband and of the wife, as well as of the conjugal partnership shall be notified of any petition for judicialapproval or the voluntary dissolution of the conjugal
partnership, so that any such creditors may appear atthe hearing to safeguard his interests. Upon approval of the petition for dissolution of the conjugal
partnership, the court shall take such measures as may protect the creditors and other third persons.
After dissolution of the conjugal partnership, the provisions of articles 214 and 215 shall apply. The provisions of this Code concerning the effect of partition
stated in articles 498 to 501 shall be applicable. (1433a)
But was not the approval of the Agreement by the CFI of Sto. Domingo in the Dominican Republic sufficient in dissolving and liquidating the conjugal
partnership of gains between the late Atty. Luna and Eugenia?
The query is answered in the negative. There is no question that the approval took place only as an incident ofthe action for divorce instituted by Atty. Luna
and Eugenia, for, indeed, the justifications for their execution of the Agreement were identical to the grounds raised in the action for divorce.21 With the
divorce not being itself valid and enforceable under Philippine law for being contrary to Philippine public policy and public law, the approval of the Agreement
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was not also legally valid and enforceable under Philippine law. Consequently, the conjugal partnership of gains of Atty. Luna and Eugenia subsisted in the
lifetime of their marriage.
3. Atty. Lunas marriage with Soledad, being bigamous,

was void; properties acquired during their marriage
were governed by the rules on co-ownership
What law governed the property relations of the second marriage between Atty. Luna and Soledad?
The CA expressly declared that Atty. Lunas subsequent marriage to Soledad on January 12, 1976 was void for being bigamous,22 on the ground that the
marriage between Atty. Luna and Eugenia had not been dissolved by the Divorce Decree rendered by the CFI of Sto. Domingo in the Dominican Republic
but had subsisted until the death of Atty. Luna on July 12, 1997.
The Court concurs with the CA.
In the Philippines, marriages that are bigamous, polygamous, or incestuous are void. Article 71 of the Civil Codeclearly states:
Article 71. All marriages performed outside the Philippines in accordance with the laws in force in the country where they were performed, and valid there as
such, shall also be valid in this country, except bigamous, polygamous, or incestuous marriages as determined by Philippine law.
Bigamy is an illegal marriage committed by contracting a second or subsequent marriage before the first marriage has been legally dissolved, or before the
absent spouse has been declared presumptively dead by means of a judgment rendered in the proper proceedings.23 A bigamous marriage is considered
void ab initio.24
Due to the second marriage between Atty. Luna and the petitioner being void ab initioby virtue of its being bigamous, the properties acquired during the
bigamous marriage were governed by the rules on co-ownership, conformably with Article 144 of the Civil Code, viz:
Article 144. When a man and a woman live together as husband and wife, but they are not married, ortheir marriage is void from the beginning, the property
acquired by eitheror both of them through their work or industry or their wages and salaries shall be governed by the rules on co-ownership.(n)
In such a situation, whoever alleges co-ownership carried the burden of proof to confirm such fact.1wphi1 To establish co-ownership, therefore, it became
imperative for the petitioner to offer proof of her actual contributions in the acquisition of property. Her mere allegation of co-ownership, without sufficient and
competent evidence, would warrant no relief in her favor. As the Court explained in Saguid v. Court of Appeals:25
In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue of co-ownership ofproperties acquired by the parties to a bigamous
marriage and an adulterous relationship, respectively, we ruled that proof of actual contribution in the acquisition of the property is essential. The claim of co-
ownership of the petitioners therein who were parties to the bigamous and adulterousunion is without basis because they failed to substantiate their allegation
that they contributed money in the purchase of the disputed properties. Also in Adriano v. Court of Appeals, we ruled that the fact that the controverted property
83
was titled in the name of the parties to an adulterous relationship is not sufficient proof of coownership absent evidence of actual contribution in the acquisition
of the property.
As in other civil cases, the burden of proof rests upon the party who, as determined by the pleadings or the nature of the case, asserts an affirmative issue.
Contentions must be proved by competent evidence and reliance must be had on the strength of the partys own evidence and not upon the weakness of the
opponents defense. This applies with more vigor where, as in the instant case, the plaintiff was allowed to present evidence ex parte.1wphi1 The plaintiff is
not automatically entitled to the relief prayed for. The law gives the defendantsome measure of protection as the plaintiff must still prove the allegations in the
complaint. Favorable relief can be granted only after the court isconvinced that the facts proven by the plaintiff warrant such relief. Indeed, the party alleging
a fact has the burden of proving it and a mereallegation is not evidence.26
The petitioner asserts herein that she sufficiently proved her actual contributions in the purchase of the condominium unit in the aggregate amount of at least
P306,572.00, consisting in direct contributions of P159,072.00, and in repaying the loans Atty. Luna had obtained from Premex Financing and Banco Filipino
totaling P146,825.30;27 and that such aggregate contributions of P306,572.00 corresponded to almost the entire share of Atty. Luna in the purchase of the
condominium unit amounting to P362,264.00 of the units purchase price of P1,449,056.00.28 The petitioner further asserts that the lawbooks were paid for
solely out of her personal funds, proof of which Atty. Luna had even sent her a "thank you" note;29 that she had the financial capacity to make the contributions
and purchases; and that Atty. Luna could not acquire the properties on his own due to the meagerness of the income derived from his law practice.
Did the petitioner discharge her burden of proof on the co-ownership?
In resolving the question, the CA entirely debunked the petitioners assertions on her actual contributions through the following findings and conclusions,
namely:
SOLEDAD was not able to prove by preponderance of evidence that her own independent funds were used to buy the law office condominium and the law
books subject matter in contentionin this case proof that was required for Article 144 of the New Civil Code and Article 148 of the Family Code to apply as
to cases where properties were acquired by a man and a woman living together as husband and wife but not married, or under a marriage which was void ab
initio. Under Article 144 of the New Civil Code, the rules on co-ownership would govern. But this was not readily applicable to many situations and thus it
created a void at first because it applied only if the parties were not in any way incapacitated or were without impediment to marry each other (for it would be
absurd to create a co-ownership where there still exists a prior conjugal partnership or absolute community between the man and his lawful wife). This void
was filled upon adoption of the Family Code. Article 148 provided that: only the property acquired by both of the parties through their actual joint contribution
of money, property or industry shall be owned in common and in proportion to their respective contributions. Such contributions and corresponding shares
were prima faciepresumed to be equal. However, for this presumption to arise, proof of actual contribution was required. The same rule and presumption was
to apply to joint deposits of money and evidence of credit. If one of the parties was validly married to another, his or her share in the co-ownership accrued to
the absolute community or conjugal partnership existing in such valid marriage. If the party who acted in bad faith was not validly married to another, his or
her share shall be forfeited in the manner provided in the last paragraph of the Article 147. The rules on forfeiture applied even if both parties were in bad
faith. Co-ownership was the exception while conjugal partnership of gains was the strict rule whereby marriage was an inviolable social institution and divorce
decrees are not recognized in the Philippines, as was held by the Supreme Court in the case of Tenchavez vs. Escao, G.R. No. L-19671, November 29,
1965, 15 SCRA 355, thus:
84
xxxx
As to the 25/100pro-indivisoshare of ATTY. LUNA in the condominium unit, SOLEDAD failed to prove that she made an actual contribution to purchase the
said property. She failed to establish that the four (4) checks that she presented were indeed used for the acquisition of the share of ATTY. LUNA in the
condominium unit. This was aptly explained in the Decision of the trial court, viz.:
"x x x The first check, Exhibit "M" for P55,000.00 payable to Atty. Teresita Cruz Sison was issued on January 27, 1977, which was thirteen (13) months before
the Memorandum of Agreement, Exhibit "7" was signed. Another check issued on April 29, 1978 in the amount of P97,588.89, Exhibit "P" was payable to
Banco Filipino. According to the plaintiff, thiswas in payment of the loan of Atty. Luna. The third check which was for P49,236.00 payable to PREMEX was
dated May 19, 1979, also for payment of the loan of Atty. Luna. The fourth check, Exhibit "M", for P4,072.00 was dated December 17, 1980. None of the
foregoing prove that the amounts delivered by plaintiff to the payees were for the acquisition of the subject condominium unit. The connection was simply not
established. x x x"
SOLEDADs claim that she made a cash contribution of P100,000.00 is unsubstantiated. Clearly, there is no basis for SOLEDADs claim of co-ownership over
the 25/100 portion of the condominium unit and the trial court correctly found that the same was acquired through the sole industry of ATTY. LUNA, thus:
"The Deed of Absolute Sale, Exhibit "9", covering the condominium unit was in the name of Atty. Luna, together with his partners in the law firm. The name of
the plaintiff does not appear as vendee or as the spouse of Atty. Luna. The same was acquired for the use of the Law firm of Atty. Luna. The loans from Allied
Banking Corporation and Far East Bank and Trust Company were loans of Atty. Luna and his partners and plaintiff does not have evidence to show that she
paid for them fully or partially. x x x"
The fact that CCT No. 4779 and subsequently, CCT No. 21761 were in the name of "JUAN LUCES LUNA, married to Soledad L. Luna" was no proof that
SOLEDAD was a co-owner of the condominium unit. Acquisition of title and registration thereof are two different acts. It is well settled that registration does
not confer title but merely confirms one already existing. The phrase "married to" preceding "Soledad L. Luna" is merely descriptive of the civil status of ATTY.
LUNA.
SOLEDAD, the second wife, was not even a lawyer. So it is but logical that SOLEDAD had no participation in the law firm or in the purchase of books for the
law firm. SOLEDAD failed to prove that she had anything to contribute and that she actually purchased or paid for the law office amortization and for the law
books. It is more logical to presume that it was ATTY. LUNA who bought the law office space and the law books from his earnings from his practice of law
rather than embarrassingly beg or ask from SOLEDAD money for use of the law firm that he headed.30
The Court upholds the foregoing findings and conclusions by the CA both because they were substantiated by the records and because we have not been
shown any reason to revisit and undo them. Indeed, the petitioner, as the party claiming the co-ownership, did not discharge her burden of proof. Her mere
allegations on her contributions, not being evidence,31 did not serve the purpose. In contrast, given the subsistence of the first marriage between Atty. Luna
and Eugenia, the presumption that Atty. Luna acquired the properties out of his own personal funds and effort remained. It should then be justly concluded
that the properties in litislegally pertained to their conjugal partnership of gains as of the time of his death. Consequently, the sole ownership of the 25/100
pro indivisoshare of Atty. Luna in the condominium unit, and of the lawbooks pertained to the respondents as the lawful heirs of Atty. Luna.
85
WHEREFORE, the Court AFFIRMS the decision promulgated on November 11, 2005; and ORDERS the petitioner to pay the costs of suit.
SO ORDERED.
NOVERAS VS NOVERAS 2014
Before the Court is a petition for review assailing the 9 May 2008 Decision1 of the Court of Appeals in CA-G.R .. CV No. 88686, which affirmed in part the 8
December 2006 Decision2 of the Regional Trial Court (RTC) of Baler, Aurora, Branch 96.
The factual antecedents are as follow:
David A. Noveras (David) and Leticia T. Noveras (Leticia) were married on 3 December 1988 in Quezon City, Philippines. They resided in California, United
States of America (USA) where they eventually acquired American citizenship. They then begot two children, namely: Jerome T.
Noveras, who was born on 4 November 1990 and JenaT. Noveras, born on 2 May 1993. David was engaged in courier service business while Leticia worked
as a nurse in San Francisco, California.
During the marriage, they acquired the following properties in the Philippines and in the USA:
PHILIPPINES
PROPERTY FAIR MARKET VALUE
House and Lot with an area of 150 sq. m. located at 1085 Norma Street, Sampaloc, Manila (Sampaloc property)
P1,693,125.00
Agricultural land with an area of 20,742 sq. m. located at Laboy, Dipaculao, Aurora
P400,000.00
A parcel of land with an area of 2.5 hectares located at Maria Aurora, Aurora
P490,000.00
A parcel of land with an area of 175 sq.m. located at Sabang Baler, Aurora
P175,000.00 3
3-has. coconut plantation in San Joaquin Maria Aurora, Aurora
P750,000.00
USA
PROPERTY FAIR MARKET VALUE
86
House and Lot at 1155 Hanover Street, Daly City, California
$550,000.00
(unpaid debt of $285,000.00)
Furniture and furnishings
$3,000
Jewelries (ring and watch)
$9,000
2000 Nissan Frontier 4x4 pickup truck
$13,770.00
Bank of America Checking Account
$8,000
Bank of America Cash Deposit
Life Insurance (Cash Value)
$100,000.00
Retirement, pension, profit-sharing, annuities
$56,228.00 4
The Sampaloc property used to beowned by Davids parents. The parties herein secured a loan from a bank and mortgaged the property. When said property
was about to be foreclosed, the couple paid a total of P1.5 Million for the redemption of the same.
Due to business reverses, David left the USA and returned to the Philippines in 2001. In December 2002,Leticia executed a Special Power of Attorney (SPA)
authorizing David to sell the Sampaloc property for P2.2 Million. According to Leticia, sometime in September 2003, David abandoned his family and lived
with Estrellita Martinez in Aurora province. Leticia claimed that David agreed toand executed a Joint Affidavit with Leticia in the presence of Davids father,
Atty. Isaias Noveras, on 3 December 2003 stating that: 1) the P1.1Million proceeds from the sale of the Sampaloc property shall be paid to and collected by
Leticia; 2) that David shall return and pay to Leticia P750,000.00, which is equivalent to half of the amount of the redemption price of the Sampaloc property;
and 3) that David shall renounce and forfeit all his rights and interest in the conjugal and real properties situated in the Philippines.5 David was able to collect
P1,790,000.00 from the sale of the Sampaloc property, leaving an unpaid balance of P410,000.00.
Upon learning that David had an extra-marital affair, Leticia filed a petition for divorce with the Superior Court of California, County of San Mateo, USA. The
California court granted the divorce on 24 June 2005 and judgment was duly entered on 29 June 2005.6 The California court granted to Leticia the custody
of her two children, as well as all the couples properties in the USA.7
87
On 8 August 2005, Leticia filed a petition for Judicial Separation of Conjugal Property before the RTC of Baler, Aurora. She relied on the 3 December 2003
Joint Affidavit and Davids failure to comply with his obligation under the same. She prayed for: 1) the power to administer all conjugal properties in the
Philippines; 2) David and his partner to cease and desist from selling the subject conjugal properties; 3) the declaration that all conjugal properties be forfeited
in favor of her children; 4) David to remit half of the purchase price as share of Leticia from the sale of the Sampaloc property; and 5) the payment ofP50,000.00
and P100,000.00 litigation expenses.8
In his Answer, David stated that a judgment for the dissolution of their marriage was entered on 29 June 2005 by the Superior Court of California, County of
San Mateo. He demanded that the conjugal partnership properties, which also include the USA properties, be liquidated and that all expenses of liquidation,
including attorneys fees of both parties be charged against the conjugal partnership.9
The RTC of Baler, Aurora simplified the issues as follow:
1. Whether or not respondent David A. Noveras committed acts of abandonment and marital infidelity which can result intothe forfeiture of the parties
properties in favor of the petitioner and their two (2) children.
2. Whether or not the Court has jurisdiction over the properties in California, U.S.A. and the same can be included in the judicial separation prayed for.
3. Whether or not the "Joint Affidavit" x x x executed by petitioner Leticia T. Noveras and respondent David A. Noveras will amount to a waiver or forfeiture of
the latters property rights over their conjugal properties.
4. Whether or not Leticia T. Noveras isentitled to reimbursement of onehalf of the P2.2 [M]illion sales proceeds of their property in Sampaloc, Manila and one-
half of the P1.5 [M]illion used to redeem the property of Atty. Isaias Noveras, including interests and charges.
5. How the absolute community properties should be distributed.
6. Whether or not the attorneys feesand litigation expenses of the parties were chargeable against their conjugal properties.
Corollary to the aboveis the issue of:
Whether or not the two common children of the parties are entitled to support and presumptive legitimes.10
On 8 December 2006, the RTC rendered judgment as follows:
1. The absolute community of property of the parties is hereby declared DISSOLVED;
2. The net assets of the absolute community of property ofthe parties in the Philippines are hereby ordered to be awarded to respondent David A. Noveras
only, with the properties in the United States of America remaining in the sole ownership of petitioner Leticia Noveras a.k.a. Leticia Tacbiana pursuant to the
88
divorce decree issuedby the Superior Court of California, County of San Mateo, United States of America, dissolving the marriage of the parties as of June
24, 2005. The titles presently covering said properties shall be cancelled and new titles be issued in the name of the party to whom said properties are
awarded;
3. One-half of the properties awarded to respondent David A. Noveras in the preceding paragraph are hereby given to Jerome and Jena, his two minor
children with petitioner LeticiaNoveras a.k.a. Leticia Tacbiana as their presumptive legitimes and said legitimes must be annotated on the titles covering the
said properties.Their share in the income from these properties shall be remitted to them annually by the respondent within the first half of January of each
year, starting January 2008;
4. One-half of the properties in the United States of America awarded to petitioner Leticia Noveras a.k.a. Leticia Tacbiana in paragraph 2 are hereby given to
Jerome and Jena, her two minor children with respondent David A. Noveras as their presumptive legitimes and said legitimes must be annotated on the
titles/documents covering the said properties. Their share in the income from these properties, if any, shall be remitted to them annually by the petitioner
within the first half of January of each year, starting January 2008;
5. For the support of their two (2) minor children, Jerome and Jena, respondent David A. Noveras shall give them US$100.00 as monthly allowance in addition
to their income from their presumptive legitimes, while petitioner Leticia Tacbiana shall take care of their food, clothing, education and other needs while they
are in her custody in the USA. The monthly allowance due from the respondent shall be increased in the future as the needs of the children require and his
financial capacity can afford;
6. Of the unpaid amount of P410,000.00 on the purchase price of the Sampaloc property, the Paringit Spouses are hereby ordered to pay P5,000.00 to
respondent David A. Noveras and P405,000.00 to the two children. The share of the respondent may be paid to him directly but the share of the two children
shall be deposited with a local bank in Baler, Aurora, in a joint account tobe taken out in their names, withdrawal from which shall only be made by them or
by their representative duly authorized with a Special Power of Attorney. Such payment/deposit shall be made withinthe period of thirty (30) days after receipt
of a copy of this Decision, with the passbook of the joint account to be submitted to the custody of the Clerk of Court of this Court within the same period. Said
passbook can be withdrawn from the Clerk of Court only by the children or their attorney-in-fact; and
7. The litigation expenses and attorneys fees incurred by the parties shall be shouldered by them individually.11
The trial court recognized that since the parties are US citizens, the laws that cover their legal and personalstatus are those of the USA. With respect to their
marriage, the parties are divorced by virtue of the decree of dissolution of their marriage issued by the Superior Court of California, County of San Mateo on
24June 2005. Under their law, the parties marriage had already been dissolved. Thus, the trial court considered the petition filed by Leticia as one for
liquidation of the absolute community of property regime with the determination of the legitimes, support and custody of the children, instead of an action for
judicial separation of conjugal property.
With respect to their property relations, the trial court first classified their property regime as absolute community of property because they did not execute
any marriage settlement before the solemnization of their marriage pursuant to Article 75 of the Family Code. Then, the trial court ruled that in accordance
with the doctrine of processual presumption, Philippine law should apply because the court cannot take judicial notice of the US law since the parties did not
submit any proof of their national law. The trial court held that as the instant petition does not fall under the provisions of the law for the grant of judicial
89
separation of properties, the absolute community properties cannot beforfeited in favor of Leticia and her children. Moreover, the trial court observed that
Leticia failed to prove abandonment and infidelity with preponderant evidence.
The trial court however ruled that Leticia is not entitled to the reimbursements she is praying for considering that she already acquired all of the properties in
the USA. Relying still on the principle of equity, the Court also adjudicated the Philippine properties to David, subject to the payment of the childrens
presumptive legitimes. The trial court held that under Article 89 of the Family Code, the waiver or renunciation made by David of his property rights in the Joint
Affidavit is void.
On appeal, the Court of Appeals modified the trial courts Decision by directing the equal division of the Philippine properties between the spouses. Moreover
with respect to the common childrens presumptive legitime, the appellate court ordered both spouses to each pay their children the amount of P520,000.00,
thus:
WHEREFORE, the instant appeal is PARTLY GRANTED. Numbers 2, 4 and 6 of the assailedDecision dated December 8, 2006 of Branch 96, RTC of Baler,
Aurora Province, in Civil Case No. 828 are hereby MODIFIED to read as follows:
2. The net assets of the absolute community of property of the parties in the Philippines are hereby divided equally between petitioner Leticia Noveras a.k.a.
Leticia Tacbiana (sic) and respondent David A. Noveras;
xxx
4. One-half of the properties awarded to petitioner Leticia Tacbiana (sic) in paragraph 2 shall pertain to her minor children, Jerome and Jena, as their
presumptive legitimes which shall be annotated on the titles/documents covering the said properties. Their share in the income therefrom, if any, shall be
remitted to them by petitioner annually within the first half of January, starting 2008;
xxx
6. Respondent David A. Noveras and petitioner Leticia Tacbiana (sic) are each ordered to pay the amount ofP520,000.00 to their two children, Jerome and
Jena, as their presumptive legitimes from the sale of the Sampaloc property inclusive of the receivables therefrom, which shall be deposited to a local bank
of Baler, Aurora, under a joint account in the latters names. The payment/deposit shall be made within a period of thirty (30) days from receipt ofa copy of
this Decision and the corresponding passbook entrusted to the custody ofthe Clerk of Court a quowithin the same period, withdrawable only by the children
or their attorney-in-fact.
A number 8 is hereby added, which shall read as follows:
8. Respondent David A. Noveras is hereby ordered to pay petitioner Leticia Tacbiana (sic) the amount of P1,040,000.00 representing her share in the proceeds
from the sale of the Sampaloc property.
The last paragraph shall read as follows:
90
Send a copy of this Decision to the local civil registry of Baler, Aurora; the local civil registry of Quezon City; the Civil RegistrarGeneral, National Statistics
Office, Vibal Building, Times Street corner EDSA, Quezon City; the Office of the Registry of Deeds for the Province of Aurora; and to the children, Jerome
Noveras and Jena Noveras.
The rest of the Decision is AFFIRMED.12
In the present petition, David insists that the Court of Appeals should have recognized the California Judgment which awarded the Philippine properties to
him because said judgment was part of the pleading presented and offered in evidence before the trial court. David argues that allowing Leticia to share in
the Philippine properties is tantamount to unjust enrichment in favor of Leticia considering that the latter was already granted all US properties by the California
court.
In summary and review, the basic facts are: David and Leticia are US citizens who own properties in the USA and in the Philippines. Leticia obtained a decree
of divorce from the Superior Court of California in June 2005 wherein the court awarded all the properties in the USA to Leticia. With respect to their properties
in the Philippines, Leticiafiled a petition for judicial separation ofconjugal properties.
At the outset, the trial court erred in recognizing the divorce decree which severed the bond of marriage between the parties. In Corpuz v. Sto. Tomas,13 we
stated that:
The starting point in any recognition of a foreign divorce judgment is the acknowledgment that our courts do not take judicial notice of foreign judgments and
laws. Justice Herrera explained that, as a rule, "no sovereign is bound to give effect within its dominion to a judgment rendered by a tribunal of another
country." This means that the foreign judgment and its authenticity must beproven as facts under our rules on evidence, together with the aliens applicable
national law to show the effect of the judgment on the alien himself or herself. The recognition may be made in an action instituted specifically for the purpose
or in another action where a party invokes the foreign decree as an integral aspect of his claim or defense.14
The requirements of presenting the foreign divorce decree and the national law of the foreigner must comply with our Rules of Evidence. Specifically, for
Philippine courts to recognize a foreign judgment relating to the status of a marriage, a copy of the foreign judgment may be admitted in evidence and proven
as a fact under Rule 132, Sections 24 and 25, in relation to Rule 39, Section 48(b) of the Rules of Court.15
Under Section 24 of Rule 132, the record of public documents of a sovereign authority or tribunal may be proved by: (1) an official publication thereof or (2) a
copy attested by the officer having the legal custody thereof. Such official publication or copy must beaccompanied, if the record is not kept in the Philippines,
with a certificate that the attesting officer has the legal custody thereof. The certificate may be issued by any of the authorized Philippine embassy or consular
officials stationed in the foreign country in which the record is kept, and authenticated by the seal of his office. The attestation must state, in substance, that
the copy is a correct copy of the original, or a specific part thereof, asthe case may be, and must be under the official seal of the attesting officer.
Section 25 of the same Rule states that whenever a copy of a document or record is attested for the purpose of evidence, the attestation must state, in
substance, that the copy is a correct copy of the original, or a specific part thereof, as the case may be. The attestation must be under the official seal of the
attesting officer, if there be any, or if hebe the clerk of a court having a seal, under the seal of such court.
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Based on the records, only the divorce decree was presented in evidence. The required certificates to prove its authenticity, as well as the pertinent California
law on divorce were not presented.
It may be noted that in Bayot v. Court of Appeals,16 we relaxed the requirement on certification where we held that "[petitioner therein] was clearly an American
citizenwhen she secured the divorce and that divorce is recognized and allowed in any of the States of the Union, the presentation of a copy of foreign divorce
decree duly authenticatedby the foreign court issuing said decree is, as here, sufficient." In this case however, it appears that there is no seal from the office
where the divorce decree was obtained.
Even if we apply the doctrine of processual presumption17 as the lower courts did with respect to the property regime of the parties, the recognition of divorce
is entirely a different matter because, to begin with, divorce is not recognized between Filipino citizens in the Philippines. Absent a valid recognition of the
divorce decree, it follows that the parties are still legally married in the Philippines. The trial court thus erred in proceeding directly to liquidation.
As a general rule, any modification in the marriage settlements must be made before the celebration of marriage. An exception to this rule is allowed provided
that the modification isjudicially approved and refers only to the instances provided in Articles 66,67, 128, 135 and 136 of the Family Code.18
Leticia anchored the filing of the instant petition for judicial separation of property on paragraphs 4 and 6 of Article 135 of the Family Code, to wit:
Art. 135. Any of the following shall be considered sufficient cause for judicial separation of property:
(1) That the spouse of the petitioner has been sentenced to a penalty which carries with it civil interdiction;
(2) That the spouse of the petitioner has been judicially declared an absentee;
(3) That loss of parental authority ofthe spouse of petitioner has been decreed by the court;
(4) That the spouse of the petitioner has abandoned the latter or failed to comply with his or her obligations to the family as provided for in Article 101;
(5) That the spouse granted the power of administration in the marriage settlements has abused that power; and
(6) That at the time of the petition, the spouses have been separated in fact for at least one year and reconciliation is highly improbable.
In the cases provided for in Numbers (1), (2), and (3), the presentation of the final judgment against the guiltyor absent spouse shall be enough basis for the
grant of the decree ofjudicial separation of property. (Emphasis supplied).
The trial court had categorically ruled that there was no abandonment in this case to necessitate judicial separation of properties under paragraph 4 of Article
135 of the Family Code. The trial court ratiocinated:
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Moreover, abandonment, under Article 101 of the Family Code quoted above, must be for a valid cause and the spouse is deemed to have abandoned the
other when he/she has left the conjugal dwelling without intention of returning. The intention of not returning is prima facie presumed if the allegedly [sic]
abandoning spouse failed to give any information as to his or her whereabouts within the period of three months from such abandonment.
In the instant case, the petitioner knows that the respondent has returned to and stayed at his hometown in Maria Aurora, Philippines, as she even went
several times to visit him there after the alleged abandonment. Also, the respondent has been going back to the USA to visit her and their children until the
relations between them worsened. The last visit of said respondent was in October 2004 when he and the petitioner discussed the filing by the latter of a
petition for dissolution of marriage with the California court. Such turn for the worse of their relationship and the filing of the saidpetition can also be considered
as valid causes for the respondent to stay in the Philippines.19
Separation in fact for one year as a ground to grant a judicial separation of property was not tackled in the trial courts decision because, the trial court
erroneously treated the petition as liquidation of the absolute community of properties.
The records of this case are replete with evidence that Leticia and David had indeed separated for more than a year and that reconciliation is highly improbable.
First, while actual abandonment had not been proven, it is undisputed that the spouses had been living separately since 2003 when David decided to go back
to the Philippines to set up his own business. Second, Leticia heard from her friends that David has been cohabiting with Estrellita Martinez, who represented
herself as Estrellita Noveras. Editha Apolonio, who worked in the hospital where David was once confined, testified that she saw the name of Estrellita listed
as the wife of David in the Consent for Operation form.20 Third and more significantly, they had filed for divorce and it was granted by the California court in
June 2005.
Having established that Leticia and David had actually separated for at least one year, the petition for judicial separation of absolute community of property
should be granted.
The grant of the judicial separation of the absolute community property automatically dissolves the absolute community regime, as stated in the 4th paragraph
of Article 99 ofthe Family Code, thus:
Art. 99. The absolute community terminates:
(1) Upon the death of either spouse;
(2) When there is a decree of legal separation;
(3) When the marriage is annulled or declared void; or
(4) In case of judicial separation of property during the marriage under Articles 134 to 138. (Emphasis supplied).
Under Article 102 of the same Code, liquidation follows the dissolution of the absolute community regime and the following procedure should apply:
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Art. 102. Upon dissolution of the absolute community regime, the following procedure shall apply:
(1) An inventory shall be prepared, listing separately all the properties of the absolute community and the exclusive properties of each spouse.
(2) The debts and obligations of the absolute community shall be paid out of its assets. In case of insufficiency of said assets, the spouses shall be solidarily
liable for the unpaid balance with their separate properties in accordance with the provisions of the second paragraph of Article 94.
(3) Whatever remains of the exclusive properties of the spouses shall thereafter be delivered to each of them.
(4) The net remainder of the properties of the absolute community shall constitute its net assets, which shall be divided equally between husband and wife,
unless a different proportion or division was agreed upon in the marriage settlements, or unless there has been a voluntary waiver of such share provided in
this Code. For purposes of computing the net profits subject to forfeiture in accordance with Articles 43, No. (2) and 63, No. (2),the said profits shall be the
increase in value between the market value of the community property at the time of the celebration of the marriage and the market value at the time of its
dissolution.
(5) The presumptive legitimes of the common children shall be delivered upon partition, in accordance with Article 51.
(6) Unless otherwise agreed upon by the parties, in the partition of the properties, the conjugal dwelling and the lot on which it is situated shall be adjudicated
tothe spouse with whom the majority of the common children choose to remain. Children below the age of seven years are deemed to have chosen the
mother, unless the court has decided otherwise. In case there is no such majority, the court shall decide, taking into consideration the best interests of said
children. At the risk of being repetitious, we will not remand the case to the trial court. Instead, we shall adopt the modifications made by the Court of Appeals
on the trial courts Decision with respect to liquidation.
We agree with the appellate court that the Philippine courts did not acquire jurisdiction over the California properties of David and Leticia. Indeed, Article 16
of the Civil Code clearly states that real property as well as personal property is subject to the law of the country where it is situated. Thus, liquidation shall
only be limited to the Philippine properties.
We affirm the modification madeby the Court of Appeals with respect to the share of the spouses in the absolutecommunity properties in the Philippines, as
well as the payment of their childrens presumptive legitimes, which the appellate court explained in this wise:
Leticia and David shall likewise have an equal share in the proceeds of the Sampaloc property.1wphi1 While both claimed to have contributed to the
redemption of the Noveras property, absent a clear showing where their contributions came from, the same is presumed to have come from the community
property. Thus, Leticia is not entitled to reimbursement of half of the redemption money.
David's allegation that he used part of the proceeds from the sale of the Sampaloc property for the benefit of the absolute community cannot be given full
credence. Only the amount of P120,000.00 incurred in going to and from the U.S.A. may be charged thereto. Election expenses in the amount of P300,000.00
when he ran as municipal councilor cannot be allowed in the absence of receipts or at least the Statement of Contributions and Expenditures required under
Section 14 of Republic Act No. 7166 duly received by the Commission on Elections. Likewise, expenses incurred to settle the criminal case of his personal
94
driver is not deductible as the same had not benefited the family. In sum, Leticia and David shall share equally in the proceeds of the sale net of the amount
of P120,000.00 or in the respective amounts of P1,040,000.00.
xxxx
Under the first paragraph of Article 888 of the Civil Code, "(t)he legitime of legitimate children and descendants consists of one-half or the hereditary estate
of the father and of the mother." The children arc therefore entitled to half of the share of each spouse in the net assets of the absolute community, which
shall be annotated on the titles/documents covering the same, as well as to their respective shares in the net proceeds from the sale of the Sampaloc property
including the receivables from Sps. Paringit in the amount of P410,000.00. Consequently, David and Leticia should each pay them the amount of P520,000.00
as their presumptive legitimes therefrom.21
WHEREFORE, the petition is DENIED. The assailed Decision of the Court of Appeals in CA G.R. CV No. 88686 is AFFIRMED.
SO ORDERED.
ORION SAVINGS BANK VS SUZUKI 2014
Before us is the Petition for Review on Certiorari1 filed by petitioner Orion Savings Bank (Orion) under Rule 45 of the Rules of Court, assailing the decision2
dated August 23, 2012 and the resolution3 dated January 25, 2013 of the Court of Appeals (CA) in CA-G.R. CV No. 94104.
The Factual Antecedents
In the first week of August 2003, respondent Shigekane Suzuki (Suzuki), a Japanese national, met with Ms. Helen Soneja (Soneja) to inquire about a
condominium unit and a parking slot at Cityland Pioneer, Mandaluyong City, allegedly owned by Yung Sam Kang (Kang), a Korean national and a Special
Resident Retiree's Visa (SRRV) holder.
At the meeting, Soneja informed Suzuki that Unit No. 536 [covered by Condominium Certificate of Title (CCT) No. 18186]4 and Parking Slot No. 42 [covered
by CCT No. 9118]5 were for sale for P3,000,000.00. Soneja likewise assured Suzuki that the titles to the unit and the parking slot were clean. After a brief
negotiation, the parties agreed to reduce the price to P2,800,000.00. On August 5, 2003, Suzuki issued Kang a Bank of the Philippine Island (BPI) Check No.
833496 for One Hundred Thousand Pesos (P100,000.00) as reservation fee.7 On August 21, 2003, Suzuki issued Kang another check, BPI Check No.
83350,8 this time for P2,700,000.00 representing the remaining balance of the purchase price. Suzuki and Kang then executed a Deed of Absolute Sale dated
August 26, 20039 covering Unit No. 536 and Parking Slot No. 42. Soon after, Suzuki took possession of the condominium unit and parking lot, and commenced
the renovation of the interior of the condominium unit.
Kang thereafter made several representations with Suzuki to deliver the titles to the properties, which were then allegedly in possession of Alexander Perez
(Perez, Orions Loans Officer) for safekeeping. Despite several verbal demands, Kang failed to deliver the documents. Suzuki later on learned that Kang had
left the country, prompting Suzuki to verify the status of the properties with the Mandaluyong City Registry of Deeds.
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Before long, Suzuki learned that CCT No. 9118 representing the title to the Parking Slot No. 42 contained no annotations although it remained under the
name of Cityland Pioneer. This notwithstanding, Cityland Pioneer, through Assistant Vice President Rosario D. Perez, certified that Kang had fully paid the
purchase price of Unit. No. 53610 and Parking Slot No. 42.11 CCT No. 18186 representing the title to the condominium unit had no existing encumbrance,
except for anannotation under Entry No. 73321/C-10186 which provided that any conveyance or encumbrance of CCT No. 18186 shall be subject to approval
by the Philippine Retirement Authority (PRA). Although CCT No. 18186 contained Entry No. 66432/C-10186 dated February 2, 1999 representing a mortgage
in favor of Orion for a P1,000,000.00 loan, that annotation was subsequently cancelled on June 16, 2000 by Entry No. 73232/T. No. 10186. Despite the
cancellation of the mortgage to Orion, the titles to the properties remained in possession of Perez.
To protect his interests, Suzuki thenexecuted an Affidavit of Adverse Claim12 dated September 8, 2003, withthe Registry of Deeds of Mandaluyong City,
annotated as Entry No. 3292/C-No. 18186 in CCT No. 18186. Suzuki then demanded the delivery of the titles.13 Orion, (through Perez), however, refused to
surrender the titles, and cited the need to consult Orions legal counsel as its reason.
On October 14, 2003, Suzuki received a letter from Orions counsel dated October 9, 2003, stating that Kang obtained another loan in the amount of
P1,800,000.00. When Kang failed to pay, he executed a Dacion en Pagodated February 2, 2003, in favorof Orion covering Unit No. 536. Orion, however, did
not register the Dacion en Pago, until October 15, 2003.
On October 28, 2003, Suzuki executed an Affidavit of Adverse Claim over Parking Slot No. 42 (covered by CCT No. 9118) and this was annotated as Entry
No. 4712/C-No. 9118 in the parking lots title.
On January 27, 2004, Suzuki filed a complaint for specific performance and damages against Kang and Orion. At the pre-trial, the parties made the following
admissions and stipulations:
1. That as of August 26, 2003, Kang was the registered owner of Unit No. 536 and Parking Slot No. 42;
2. That the mortgage in favor ofOrion supposedly executed by Kang, with Entry No. 66432/C-10186 dated February 2, 1999, was subsequently cancelled by
Entry No. 73232/T No. 10186 dated June 16, 2000;
3. That the alleged Dacion en Pagowas never annotated in CCT Nos. 18186 and 9118;
4. That Orion only paid the appropriate capital gains tax and the documentary stamp tax for the alleged Dacion en Pago on October 15, 2003;
5. That Parking Slot No. 42, covered by CCT No. 9118, was never mortgaged to Orion; and
6. That when Suzuki bought the properties, he went to Orion to obtain possession of the titles.
The RTC Ruling
In its decision14 dated June 29, 2009, the Regional Trial Court (RTC), Branch 213, Mandaluyong City ruled infavor of Suzuki and ordered Orion to deliver the
CCT Nos. 18186 and 9118 to Suzuki.
The court found that Suzuki was an innocent purchaser for value whose rights over the properties prevailed over Orions. The RTC further noted that Suzuki
exerted efforts to verify the status of the properties but he did not find any existing encumbrance inthe titles. Although Orion claims to have purchased the
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property by way of a Dacion en Pago, Suzuki only learned about it two (2) months after he bought the properties because Orion never bothered to register or
annotate the Dacion en Pagoin CCT Nos. 18186 and 9116.
The RTC further ordered Orion and Kang to jointly and severally pay Suzuki moral damages, exemplary damages, attorneys fees, appearance fees, expenses
for litigation and cost ofsuit. Orion timely appealed the RTC decision with the CA.
The CA Ruling
On August 23, 2012, the CA partially granted Orions appeal and sustained the RTC insofar as it upheld Suzukis right over the properties. The CA further
noted that Entry No. 73321/C-10186 pertaining to the withdrawal of investment of an SRRV only serves as a warning to an SRRV holder about the implications
of a conveyance of a property investment. It deviated from the RTC ruling, however, by deleting the award for moral damages, exemplary damages, attorneys
fees, expenses for litigation and cost of suit.
Orion sought a reconsideration of the CA decision but the CA denied the motion in its January 25, 2013 resolution. Orion then filed a petition for review on
certiorariunder Rule 45 with this Court.
The Petition and Comment
Orions petition is based on the following grounds/arguments:15
1. The Deed of Sale executed by Kang in favor of Suzuki is null and void. Under Korean law, any conveyance of a conjugal property should be made with the
consent of both spouses;
2. Suzuki is not a buyer in good faith for he failed to check the owners duplicate copies of the CCTs;
3. Knowledge of the PRA restriction under Entry No. 73321/C-10186, which prohibits any conveyance or encumbrance of the property investment, defeats
the alleged claim of good faith by Suzuki; and
4. Orion should not be faulted for exercising due diligence.
In his Comment,16 Suzuki asserts that the issue on spousal consent was belatedly raised on appeal. Moreover, proof of acquisition during the marital coverture
is a condition sine qua nonfor the operation of the presumption of conjugal ownership.17 Suzuki additionally maintains that he is a purchaser in good faith,
and is thus entitled to the protection of the law.
The Courts Ruling
We deny the petition for lack of merit.
The Court may inquire into conclusions of fact when the inference made is manifestly mistaken
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In a Rule 45 petition, the latitude of judicial review generally excludes a factual and evidentiary re-evaluation, and the Court ordinarily abides by the uniform
factual conclusions of the trial court and the appellate court.18 In the present case, while the courts below both arrived at the same conclusion, there appears
tobe an incongruence in their factual findings and the legal principle they applied to the attendant factual circumstances. Thus, we are compelled to examine
certain factual issues in the exercise of our sound discretion to correct any mistaken inference that may have been made.19
Philippine Law governs the transfer of real property
Orion believes that the CA erred in not ruling on the issue of spousal consent. We cannot uphold this position, however, because the issue of spousal consent
was only raised on appeal to the CA. It is a well-settled principle that points of law, theories, issues, and arguments not brought to the attention of the trial
court cannot be raised for the first time on appeal and considered by a reviewing court.20 To consider these belated arguments would violate basic principles
of fairplay, justice, and due process.
Having said these, we shall nonetheless discuss the issues Orion belatedly raised, if only to put an end to lingering doubts on the correctness of the denial of
the present petition.
It is a universal principle thatreal or immovable property is exclusively subject to the laws of the country or state where it is located.21 The reason is found in
the very nature of immovable property its immobility. Immovables are part of the country and so closely connected to it that all rights over them have their
natural center of gravity there.22
Thus, all matters concerning the titleand disposition ofreal property are determined by what is known as the lex loci rei sitae, which can alone prescribe the
mode by which a title canpass from one person to another, or by which an interest therein can be gained or lost.23 This general principle includes all rules
governing the descent, alienation and transfer of immovable property and the validity, effect and construction of wills and other conveyances.24
This principle even governs the capacity of the person making a deed relating to immovable property, no matter what its nature may be. Thus, an instrument
will be ineffective to transfer title to land if the person making it is incapacitated by the lex loci rei sitae, even though under the law of his domicile and by the
law of the place where the instrument is actually made, his capacity is undoubted.25
On the other hand, property relations between spouses are governed principally by the national law of the spouses.26 However, the party invoking the
application of a foreign law has the burden of proving the foreign law. The foreign law is a question of fact to be properly pleaded and proved as the judge
cannot take judicial notice of a foreign law.27 He is presumed to know only domestic or the law of the forum.28
To prove a foreign law, the party invoking it must present a copy thereof and comply with Sections 24 and 25 of Rule 132 of the Revised Rules of Court which
reads:
SEC. 24. Proof of official record. The record of public documents referred to in paragraph (a) of Section 19, when admissible for any purpose, may be
evidenced by an official publication thereof or by a copy attested by the officer having the legal custody of the record, or by his deputy, and accompanied, if
the record is not kept in the Philippines, with a certificate that such officer has the custody. If the office in which the record is kept is in a foreign country, the
98
certificate may be made by a secretary of the embassy or legation, consul general, consul, vice consul, or consular agent or by any officer in the foreign
service of the Philippines stationed in the foreign country inwhich the record is kept, and authenticated by the seal of his office. (Emphasis supplied)
SEC. 25. What attestation ofcopy must state. Whenever a copy of a document or record is attested for the purpose of the evidence, the attestation must
state, in substance, that the copy is a correct copy of the original, or a specific part thereof, as the case may be. The attestation must be under the official seal
of the attesting officer, if there be any, or if he be the clerk of a court having a seal, under the seal of such court.
Accordingly, matters concerning the title and disposition of real property shall be governed by Philippine law while issues pertaining to the conjugal natureof
the property shall be governed by South Korean law, provided it is proven as a fact.
In the present case, Orion, unfortunately failed to prove the South Korean law on the conjugal ownership ofproperty. It merely attached a "Certification from
the Embassy of the Republic of Korea"29 to prove the existence of Korean Law. This certification, does not qualify as sufficient proof of the conjugal nature
of the property for there is no showing that it was properly authenticated bythe seal of his office, as required under Section 24 of Rule 132.30
Accordingly, the International Law doctrine of presumed-identity approachor processual presumption comes into play, i.e., where a foreign law is not pleaded
or, evenif pleaded, is not proven, the presumption is that foreign law is the same as Philippine Law.31
Under Philippine Law, the phrase "Yung Sam Kang married to' Hyun Sook Jung" is merely descriptive of the civil status of Kang.32 In other words, the import
from the certificates of title is that Kang is the owner of the properties as they are registered in his name alone, and that he is married to Hyun Sook Jung.
We are not unmindful that in numerous cases we have held that registration of the property in the name of only one spouse does not negate the possibility of
it being conjugal or community property.33 In those cases, however, there was proof that the properties, though registered in the name of only one spouse,
were indeed either conjugal or community properties.34 Accordingly, we see no reason to declare as invalid Kangs conveyance in favor of Suzuki for the
supposed lack of spousal consent.
The petitioner failed to adduce sufficient evidence to prove the due execution of the Dacion en Pago
Article 1544 of the New Civil Codeof the Philippines provides that:
ART. 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession
thereof in good faith, if it should be movable property.
Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property.
Should there be no inscription, the ownership shall pertain to the person who in good faith was first in the possession; and, in the absence thereof, to the
person who presents the oldest title, provided there is good faith.
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The application of Article 1544 of the New Civil Code presupposes the existence of two or more duly executed contracts of sale. In the present case, the Deed
of Sale dated August 26, 200335 between Suzuki and Kang was admitted by Orion36 and was properly identified by Suzukis witness Ms. Mary Jane Samin
(Samin).37
It is not disputed, too, that the Deed of Sale dated August 26, 2003 was consummated. In a contract of sale, the seller obligates himself to transfer the
ownership of the determinate thing sold, and to deliver the same to the buyer, who obligates himself to pay a price certain to the seller.38 The execution of
the notarized deed of saleand the actual transfer of possession amounted to delivery that produced the legal effect of transferring ownership to Suzuki.39
On the other hand, although Orion claims priority in right under the principle of prius tempore, potior jure (i.e.,first in time, stronger in right), it failedto prove
the existence and due execution of the Dacion en Pagoin its favor.
At the outset, Orion offered the Dacion en Pagoas Exhibit "5"with submarkings "5-a" to "5-c" to prove the existence of the February 6, 2003 transaction in its
Formal Offer dated July 20, 2008. Orion likewise offered in evidence the supposed promissory note dated September 4, 2002 as Exhibit "12"to prove the
existence of the additional P800,000.00 loan. The RTC, however, denied the admission of Exhibits "5" and "12,"among others, in its order dated August 19,
2008 "since the same [were] not identified in court by any witness."40
Despite the exclusion of its most critical documentary evidence, Orion failed to make a tender ofexcluded evidence, as provided under Section 40, Rule 132
of the Rules of Court. For this reason alone, we are prevented from seriously considering Exhibit "5" and its submarkings and Exhibit "12" in the present
petition.
Moreover, even if we consider Exhibit "5" and its submarkings and Exhibit "12" in the present petition, the copious inconsistencies and contradictions in the
testimonial and documentary evidence of Orion, militate against the conclusion that the Dacion en Pagowas duly executed. First, there appears to be no due
and demandable obligation when the Dacion en Pago was executed, contrary to the allegations of Orion. Orions witness Perez tried to impress upon the
RTC that Kang was in default in his P1,800,000.00 loan. During his direct examination, he stated:
ATTY. CRUZAT:
Q: Okay, so this loan of P1.8 million, what happened to this loan, Mr. Witness?
A: Well it became past due, there has been delayed interest payment by Mr. Kangand...
Q: So what did you do after there were defaults[?]
A: We have to secure the money or the investment of the bank through loans and we have executed a dacion en pagobecause Mr. Kang said he has no
money. So we just execute[d] the dacion en pago rather than going through the Foreclosure proceedings.
xxxx
Q: Can you tell the court when was this executed?
A: February 6, 2003, your Honor.41
A reading of the supposed promissory note, however, shows that there was nodefault to speak of when the supposed Dacion en Pagowas executed.
Based on the promissory note, Kangs loan obligation wouldmature only on August 27, 2003. Neither can Orion claim that Kang had been in default in his
installment payments because the wordings of the promissory note provide that "[t]he principal of this loanand its interest and other charges shall be paid by
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me/us in accordance hereunder: SINGLE PAYMENT LOANS.42 "There was thus no due and demandable loan obligation when the alleged Dacion en Pago
was executed.
Second, Perez, the supposed person who prepared the Dacion en Pago,appears to only have a vague idea of the transaction he supposedly prepared. During
his cross-examination, he testified:
ATTY. DE CASTRO:
Q: And were you the one who prepared this [dacion en pago] Mr. witness?
A: Yes, sir. I personally prepared this.
xxxx
Q: So this 1.8 million pesos is already inclusive of all the penalties, interest and surcharge due from Mr. Yung Sam Kang?
A: Its just the principal, sir.
Q: So you did not state the interest [and] penalties?

A: In the [dacion en pago], we do not include interest, sir. We may actually includethat but....
Q: Can you read the Second Whereas Clause, Mr. Witness?
A: Whereas the first party failed to pay the said loan to the second party and as of February 10, 2003, the outstanding obligation which is due and demandable
principal and interest and other charges included amounts to P1,800,000.00 pesos, sir.
xxxx
Q: You are now changing your answer[.] [I]t now includes interest and other charges, based on this document?
A: Yes, based on that document, sir.43
Third, the Dacion en Pago,mentioned that the P1,800,000.00 loan was secured by a real estate mortgage. However, no document was ever presented to
prove this real estate mortgage aside from it being mentioned in the Dacion en Pago itself.
ATTY. DE CASTRO:
Q: Would you know if there is any other document like a supplement to that Credit Line Agreement referring to this 1.8 million peso loan by Mr. Yung Sam
Kang which says that there was a subsequent collateralization or security given by Mr. Yung [Sam]
Kang for the loan?
xxxx
A: The [dacion en pago], sir.44
Fourth,the Dacion en Pago was first mentioned only two (2) months after Suzuki and Samin demanded the delivery of the titles sometime in August 2003,and
after Suzuki caused the annotation of his affidavit of adverse claim. Records show that it was only on October 9, 2003, when Orion, through its counsel,
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Cristobal Balbin Mapile & Associates first spoke of the Dacion en Pago.45 Not even Perez mentioned any Dacion en Pago on October 1, 2003, when he
personally received a letter demanding the delivery of the titles.Instead, Perez refused to accept the letter and opted to first consult with his lawyer.46
Notably, even the October 9, 2003 letter contained material inconsistencies in its recital of facts surrounding the execution of the Dacion en Pago. In particular,
it mentioned that "on [September 4, 2002], after paying the original loan, [Kang] applied and was granted a new Credit Line Facility by [Orion] x x x for ONE
MILLION EIGHT HUNDRED THOUSAND PESOS (P1,800,000.00)." Perez, however, testified that there was "no cash movement" in the original
P1,000,000.00 loan. In his testimony, he said:
COURT:
xxxx
Q: Would you remember what was the subject matter of that real estate mortgage for that first P1,000,000.00 loan?
A: Its a condominium Unit in Cityland, sir.
xxxx
Q: Would you recall if there was any payment by Mr. Yung Sam Kang of this P1,000,000.00 loan?
A: None sir.
Q: No payments?
A: None sir.
Q: And from 1999 to 2002, there was no payment, either by way of payment to the principal, by way ofpayment of interest, there was no payment by Mr. Yung
Sam Kang of this loan?
A: Literally, there was no actual cash movement, sir.
Q: There was no actual cash?
A: Yes, sir.
Q: And yet despite no payment, the bank Orion Savings Bank still extended an P800,000.00 additional right?
A: Yes, sir.47
Fifth, it is undisputed that notwithstanding the supposed execution of theDacion en Pago on February 2, 2003, Kang remained in possession of the
condominium unit. In fact, nothing in the records shows that Orion even bothered to take possession of the property even six (6) months after the supposed
date of execution of the Dacion en Pago. Kang was even able to transfer possession of the condominium unit to Suzuki, who then made immediate
improvements thereon. If Orion really purchased the condominium unit on February 2, 2003 and claimed to be its true owner, why did it not assert its ownership
immediately after the alleged sale took place? Why did it have to assert its ownership only after Suzuki demanded the delivery of the titles? These gaps have
remained unanswered and unfilled.
In Suntay v. CA,48 we held that the most prominent index of simulation is the complete absence of anattempt on the part of the vendee to assert his rights of
ownership over the property in question. After the sale, the vendee should have entered the land and occupied the premises. The absence of any attempt on
the part of Orion to assert its right of dominion over the property allegedly soldto it is a clear badge of fraud. That notwithstanding the execution of the Dacion
en Pago, Kang remained in possession of the disputed condominium unit from the time of the execution of the Dacion en Pagountil the propertys subsequent
transfer to Suzuki unmistakably strengthens the fictitious nature of the Dacion en Pago.
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These circumstances, aside from the glaring inconsistencies in the documents and testimony of Orions witness, indubitably prove the spurious nature of the
Dacion en Pago.
The fact that the Dacion en Pago

is a notarized document does not
support the conclusion that the
sale it embodies is a true
conveyance
Public instruments are evidence of the facts that gave rise to their execution and are to be considered as containing all the terms of the agreement.49 While
a notarized document enjoys this presumption, "the fact that a deed is notarized is not a guarantee of the validity of its contents."50 The presumption of
regularity of notarized documents is not absolute and may be rebutted by clear and convincing evidence to the contrary.51
In the present case, the presumption cannot apply because the regularity in the execution of the Dacion en Pago and the loan documents was challenged in
the proceedings below where their prima facievalidity was overthrown by the highly questionable circumstances surrounding their execution.52
Effect of the PRA restriction on

the validity of Suzukis title to the
property
Orion argues that the PRA restriction in CCT No. 18186 affects the conveyance to Suzuki. In particular, Orion assails the status of Suzuki as a purchaser in
good faith in view of the express PRA restriction contained in CCT No. 18186.53
We reject this suggested approachoutright because, to our mind, the PRA restriction cannot affect the conveyance in favor of Suzuki. On this particular point,
we concur withthe following findings of the CA:
x x x the annotation merely servesas a warning to the owner who holds a Special Resident Retirees Visa(SRRV) that he shall lose his visa if he disposes his
property which serves as his investment in order to qualify for such status. Section 14 of the Implementing Investment Guidelines under Rule VIII-A of the
Rules and Regulations Implementing Executive Order No. 1037, Creating the Philippine Retirement Park System Providing Funds Therefor and For Other
Purpose ( otherwise known as the Philippine Retirement Authority) states:
Section 14. Should the retiree-investor withdraw his investment from the Philippines, or transfer the same to another domestic enterprise, orsell, convey or
transfer his condominium unit or units to another person, natural or juridical without the prior approval of the Authority, the Special Resident Retirees Visa
issued to him, and/or unmarried minor child or children[,] may be cancelled or revoked by the Philippine Government, through the appropriate government
department or agency, upon recommendation of the Authority.54
103
Moreover, Orion should not be allowed to successfully assail the good faith of Suzuki on the basis of the PRA restriction. Orion knew of the PRA restriction
when it transacted with Kang. Incidentally, Orion admitted accommodating Kangs request to cancel the mortgage annotation despite the lack of payment to
circumvent the PRA restriction. Orion, thus, is estopped from impugning the validity of the conveyance in favor of Suzuki on the basis of the PRA restriction
that Orion itself ignored and "attempted" to circumvent.
With the conclusion that Orion failed to prove the authenticity of the Dacion en Pago, we see no reason for the application of the rules on double sale under
Article 1544 of the New Civil Code. Suzuki, moreover, successfully adduced sufficient evidence to establish the validity of conveyance in his favor.
WHEREFORE, premises considered, we DENY the petition for lack of merit. Costs against petitioner Orion Savings Bank.
SO ORDERED.
FAR EAST BANK VS PACILAN 2005
Before the Court is the petition for review on certiorari filed by Far East Bank and Trust Company (now Bank of the Philippines Islands) seeking the reversal
of the Decision[1] dated August 30, 2002 of the Court of Appeals (CA) in CA-G.R. CV No. 36627 which ordered it, together with its branch accountant, Roger
Villadelgado, to pay respondent Themistocles Pacilan, Jr.[2] the total sum of P100,000.00 as moral and exemplary damages. The assailed decision affirmed
with modification that of the Regional Trial Court (RTC) of Negros Occidental, Bacolod City, Branch 54, in Civil Case No. 4908. Likewise sought to be reversed
and set aside is the Resolution dated January 17, 2003 of the appellate court, denying petitioner banks motion for reconsideration.
The case stemmed from the following undisputed facts:
Respondent Pacilan opened a current account with petitioner banks Bacolod Branch on May 23, 1980. His account was denominated as Current Account No.
53208 (0052-00407-4). The respondent had since then issued several postdated checks to different payees drawn against the said account. Sometime in
March 1988, the respondent issued Check No. 2434886 in the amount of P680.00 and the same was presented for payment to petitioner bank on April 4,
1988.
Upon its presentment on the said date, Check No. 2434886 was dishonored by petitioner bank. The next day, or on April 5, 1988, the respondent deposited
to his current account the amount of P800.00. The said amount was accepted by petitioner bank; hence, increasing the balance of the respondents deposit
to P1,051.43.
Subsequently, when the respondent verified with petitioner bank about the dishonor of Check No. 2434866, he discovered that his current account was closed
on the ground that it was improperly handled. The records of petitioner bank disclosed that between the period of March 30,
1988 and April 5, 1988, the respondent issued four checks, to wit: Check No. 2480416 for P6,000.00; Check No. 2480419 for P50.00; Check No. 2434880
for P680.00 and; Check No. 2434886 for P680.00, or a total amount of P7,410.00. At the time, however, the respondents current account with petitioner bank
only had a deposit of P6,981.43. Thus, the total amount of the checks presented for payment on April 4, 1988 exceeded the balance of the respondents
deposit in his account. For this reason, petitioner bank, through its branch accountant, Villadelgado, closed the respondents current account effective the
evening of April 4, 1988 as it then had an overdraft of P428.57. As a consequence of the overdraft, Check No. 2434886 was dishonored.
104
On April 18, 1988, the respondent wrote to petitioner bank complaining that the closure of his account was unjustified. When he did not receive a reply from
petitioner bank, the respondent filed with the RTC of Negros Occidental, Bacolod City, Branch 54, a complaint for damages against petitioner bank and
Villadelgado. The case was docketed as Civil Case No. 4908. The respondent, as complainant therein, alleged that the closure of his current account by
petitioner bank was unjustified because on the first banking hour of April 5, 1988, he already deposited an amount sufficient to fund his checks. The respondent
pointed out that Check No. 2434886, in particular, was delivered to petitioner bank at the close of banking hours on April 4, 1988 and, following normal banking
procedure, it
(petitioner bank) had until the last clearing hour of the following day, or on April 5, 1988, to honor the check or return it, if not funded. In disregard of this
banking procedure and practice, however, petitioner bank hastily closed the respondents current account and dishonored his Check No. 2434886.
The respondent further alleged that prior to the closure of his current account, he had issued several other postdated checks. The petitioner banks act of
closing his current account allegedly preempted the deposits that he intended to make to fund those checks. Further, the petitioner banks act exposed him to
criminal prosecution for violation of Batas Pambansa Blg. 22.
According to the respondent, the indecent haste that attended the closure of his account was patently malicious and intended to embarrass him. He claimed
that he is a Cashier of Prudential Bank and Trust Company, whose branch office is located just across that of petitioner bank, and a prominent and respected
leader both in the civic and banking communities. The alleged malicious acts of petitioner bank besmirched the respondents reputation and caused him social
humiliation, wounded feelings, insurmountable worries and sleepless nights entitling him to an award of damages.
In their answer, petitioner bank and Villadelgado maintained that the respondents current account was subject to petitioner banks Rules and Regulations
Governing the Establishment and Operation of Regular Demand
Deposits which provide that the Bank reserves the right to close an account if the depositor frequently draws checks against insufficient funds and/or
uncollected deposits and that the Bank reserves the right at any time to return checks of the depositor which are drawn against insufficient funds or for any
reason.[3]
They showed that the respondent had improperly and irregularly handled his current account. For example, in 1986, the respondents account was overdrawn
156 times, in 1987, 117 times and in 1988, 26 times. In all these instances, the account was overdrawn due to the issuance of checks against insufficient
funds. The respondent had also signed several checks with a different signature from the specimen on file for dubious reasons.
When the respondent made the deposit on April 5, 1988, it was obviously to cover for issuances made the previous day against an insufficiently funded
account. When his Check No. 2434886 was presented for payment on April 4, 1988, he had already incurred an overdraft; hence, petitioner bank rightfully
dishonored the same for insufficiency of funds.
After due proceedings, the court a quo rendered judgment in favor of the respondent as it ordered the petitioner bank and Villadelgado, jointly and severally,
to pay the respondent the amounts of P100,000.00 as moral damages and P50,000.00 as exemplary damages and costs of suit. In so ruling, the court a quo
also cited petitioner banks rules and regulations which state that a charge of P10.00 shall be levied against the depositor for any check that is taken up as a
returned item due to insufficiency of funds on the date of receipt from the clearing office even if said check is honored and/or covered by sufficient deposit the
following banking day. The same rules and regulations also provide that a check returned for insufficiency of funds for any reason of similar import may be
subsequently recleared for one more time only, subject to the same charges.
105
According to the court a quo, following these rules and regulations, the respondent, as depositor, had the right to put up sufficient funds for a check that was
taken as a returned item for insufficient funds the day following the receipt of said check from the clearing office. In fact, the said check could still be recleared
for one more time. In previous instances, petitioner bank notified the respondent when he incurred an overdraft and he would then deposit sufficient funds the
following day to cover the overdraft. Petitioner bank thus acted unjustifiably when it immediately closed the respondents account on April 4, 1988 and deprived
him of the opportunity to reclear his check or deposit sufficient funds therefor the following day.
As a result of the closure of his current account, several of the respondents checks were subsequently dishonored and because of this, the respondent was
humiliated, embarrassed and lost his credit standing in the business community. The court a quo further ratiocinated that even granting arguendo that petitioner
bank had the right to close the respondents account, the manner which attended the closure constituted an abuse of the
said right. Citing Article 19 of the Civil Code of the Philippines which states that [e]very person must, in the exercise of his rights and in the performance of
his duties, act with justice, give everyone his due, and observe honesty and good faith and Article 20 thereof which states that [e]very person who, contrary
to law, wilfully or negligently causes damage to another, shall indemnify the latter for the same, the court a quo adjudged petitioner bank of acting in bad faith.
It held that, under the foregoing circumstances, the respondent is entitled to an award of moral and exemplary damages.
The decretal portion of the court a quos decision reads:
WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered:

1. Ordering the defendants [petitioner bank and Villadelgado], jointly and severally, to pay plaintiff [the respondent] the sum of P100,000.00 as moral
damages;
2. Ordering the defendants, jointly and severally, to pay plaintiff the sum of P50,000.00 as exemplary damages plus costs and expenses of the suit; and
3. Dismissing [the] defendants counterclaim for lack of merit.
SO ORDERED.[4]
On appeal, the CA rendered the Decision dated August 30, 2002, affirming with modification the decision of the court a quo.
The appellate court substantially affirmed the factual findings of the court a quo as it held that petitioner bank unjustifiably closed the respondents account
notwithstanding that its own rules and regulations
allow that a check returned for insufficiency of funds or any reason of similar import, may be subsequently recleared for one more time, subject to standard
charges. Like the court a quo, the appellate court observed that in several instances in previous years, petitioner bank would inform the respondent when he
incurred an overdraft and allowed him to make a timely deposit to fund the checks that were initially dishonored for insufficiency of funds. However, on April
4, 1988, petitioner bank immediately closed the respondents account without even notifying him that he had incurred an overdraft. Even when they had already
closed his account on April 4, 1988, petitioner bank still accepted the deposit that the respondent made on April 5, 1988, supposedly to cover his checks.
Echoing the reasoning of the court a quo, the CA declared that even as it may be conceded that petitioner bank had reserved the right to close an account
for repeated overdrafts by the respondent, the exercise of that right must never be despotic or arbitrary. That petitioner bank chose to close the account
106
outright and return the check, even after accepting a deposit sufficient to cover the said check, is contrary to its duty to handle the respondents account with
utmost fidelity. The exercise of the right is not absolute and good faith, at least, is required. The manner by which petitioner bank closed the account of the
respondent runs afoul of Article 19 of the Civil Code which enjoins every person, in the exercise of his rights, to give every one his due, and observe honesty
and good faith.
The CA concluded that petitioner banks precipitate and imprudent closure of the respondents account had caused him, a respected officer of several civic
and banking associations, serious anxiety and humiliation. It had, likewise, tainted his credit standing. Consequently, the award of damages is warranted. The
CA, however, reduced the amount of damages awarded by the court a quo as it found the same to be excessive:
We, however, find excessive the amount of damages awarded by the RTC. In our view the reduced amount of P75,000.00 as moral damages and P25,000.00
as exemplary damages are in order. Awards for damages are not meant to enrich the plaintiff-appellee [the respondent] at the expense of defendants-
appellants [the petitioners], but to obviate the moral suffering he has undergone. The award is aimed at the restoration, within limits possible, of the status
quo ante, and should be proportionate to the suffering inflicted.[5]
The dispositive portion of the assailed CA decision reads:
WHEREFORE, the decision appealed from is hereby AFFIRMED, subject to the MODIFICATION that the award of moral damages is reduced to P75,000.00
and the award of exemplary damages reduced to P25,000.00.
SO ORDERED.[6]
Petitioner bank sought the reconsideration of the said decision but in the assailed Resolution dated January 17, 2003, the appellate court denied its motion.
Hence, the recourse to this Court.
Petitioner bank maintains that, in closing the account of the respondent in the evening of April 4, 1988, it acted in good faith and in accordance with the rules
and regulations governing the operation of a
regular demand deposit which reserves to the bank the right to close an account if the depositor frequently draws checks against insufficient funds and/or
uncollected deposits. The same rules and regulations also provide that the depositor is not entitled, as a matter of right, to overdraw on this deposit and the
bank reserves the right at any time to return checks of the depositor which are drawn against insufficient funds or for any reason.
It cites the numerous instances that the respondent had overdrawn his account and those instances where he deliberately signed checks using a signature
different from the specimen on file. Based on these facts, petitioner bank was constrained to close the respondents account for improper and irregular handling
and returned his Check No. 2434886 which was presented to the bank for payment on April 4, 1988.
Petitioner bank further posits that there is no law or rule which gives the respondent a legal right to make good his check or to deposit the corresponding
amount to cover said check within 24 hours after the same is dishonored or returned by the bank for having been drawn against insufficient funds. It vigorously
denies having violated Article 19 of the Civil Code as it insists that it acted in good faith and in accordance with the pertinent banking rules and regulations.
107
The petition is impressed with merit.
A perusal of the respective decisions of the court a quo and the appellate court show that the award of damages in the respondents favor was anchored
mainly on Article 19 of the Civil Code which, quoted anew below, reads:
Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and
good faith.
The elements of abuse of rights are the following: (a) the existence of a legal right or duty; (b) which is exercised in bad faith; and (c) for the sole intent of
prejudicing or injuring another.[7] Malice or bad faith is at the core of the said provision.[8] The law always presumes good faith and any person who seeks to
be awarded damages due to acts of another has the burden of proving that the latter acted in bad faith or with ill-motive.[9] Good faith refers to the state of
the mind which is manifested by the acts of the individual concerned. It consists of the intention to abstain from taking an unconscionable and unscrupulous
advantage of another.[10] Bad faith does not simply connote bad judgment or simple negligence, dishonest purpose or some moral obliquity and conscious
doing of a wrong, a breach of known duty due to some motives or interest or ill-will that partakes of the nature of fraud.[11] Malice connotes ill-will or spite and
speaks not in response to duty. It implies an intention to do ulterior and unjustifiable harm. Malice is bad faith or bad motive.[12]
Undoubtedly, petitioner bank has the right to close the account of the respondent based on the following provisions of its Rules and Regulations Governing
the Establishment and Operation of Regular Demand Deposits:
10) The Bank reserves the right to close an account if the depositor frequently draws checks against insufficient funds and/or uncollected deposits.
12) However, it is clearly understood that the depositor is not entitled, as a matter of right, to overdraw on this deposit and the bank reserves the right at
any time to return checks of the depositor which are drawn against insufficient funds or for any other reason.
The facts, as found by the court a quo and the appellate court, do not establish that, in the exercise of this right, petitioner bank committed an abuse thereof.
Specifically, the second and third elements for abuse of rights are not attendant in the present case. The evidence presented by petitioner bank negates the
existence of bad faith or malice on its part in closing the respondents account on April 4, 1988 because on the said date the same was already overdrawn.
The respondent issued four checks, all due on April 4, 1988, amounting to P7,410.00 when the balance of his current account deposit was only P6,981.43.
Thus, he incurred an overdraft of P428.57 which resulted in the dishonor of his Check No. 2434886. Further, petitioner bank showed that in 1986, the current
account of the respondent was overdrawn 156 times due to his issuance of checks against insufficient funds.[13] In 1987, the said account was overdrawn
117 times for the same
reason.[14] Again, in 1988, 26 times.[15] There were also several instances when the respondent issued checks deliberately using a signature different from
his specimen signature on file with petitioner bank.[16] All these circumstances taken together justified the petitioner banks closure of the respondents account
on April 4, 1988 for improper handling.
It is observed that nowhere under its rules and regulations is petitioner bank required to notify the respondent, or any depositor for that matter, of the closure
of the account for frequently drawing checks against insufficient funds. No malice or bad faith could be imputed on petitioner bank for so acting since the
records bear out that the respondent had indeed been improperly and irregularly handling his account not just a few times but hundreds of times. Under the
circumstances, petitioner bank could not be faulted for exercising its right in accordance with the express rules and regulations governing the current accounts
of its depositors. Upon the opening of his account, the respondent had agreed to be bound by these terms and conditions.
108
Neither the fact that petitioner bank accepted the deposit made by the respondent the day following the closure of his account constitutes bad faith or malice
on the part of petitioner bank. The same could be characterized as simple negligence by its personnel. Said act, by itself, is not constitutive of bad faith.
The respondent had thus failed to discharge his burden of proving bad faith on the part of petitioner bank or that it was motivated by ill-will or spite in closing
his account on April 4, 1988 and in inadvertently accepting his deposit on April 5, 1988.
Further, it has not been shown that these acts were done by petitioner bank with the sole intention of prejudicing and injuring the respondent. It is conceded
that the respondent may have suffered damages as a result of the closure of his current account. However, there is a material distinction between damages
and injury. The Court had the occasion to explain the distinction between damages and injury in this wise:
Injury is the illegal invasion of a legal right; damage is the loss, hurt or harm which results from the injury; and damages are the recompense or compensation
awarded for the damage suffered. Thus, there can be damage without injury in those instances in which the loss or harm was not the result of a violation of a
legal duty. In such cases, the consequences must be borne by the injured person alone, the law affords no remedy for damages resulting from an act which
does not amount to a legal injury or wrong. These situations are often called damnum absque injuria.
In other words, in order that a plaintiff may maintain an action for the injuries of which he complains, he must establish that such injuries resulted from a
breach of duty which the defendant owed to the plaintiff a concurrence of injury to the plaintiff and legal responsibility by the person causing it. The underlying
basis for the award of tort damages is the premise that the individual was injured in contemplation of law. Thus, there must first be a breach of some duty and
the imposition of liability for that breach before damages may be awarded; and the breach of such duty should be the proximate cause of the injury.[17]
Whatever damages the respondent may have suffered as a consequence, e.g., dishonor of his other insufficiently funded checks, would have to be borne by
him alone. It was the respondents repeated improper
and irregular handling of his account which constrained petitioner bank to close the same in accordance with the rules and regulations governing its depositors
current accounts. The respondents case is clearly one of damnum absque injuria.
WHEREFORE, the petition is GRANTED. The Decision dated August 30, 2002 and Resolution dated January 17, 2003 of the Court of Appeals in CA-G.R.
CV No. 36627 are REVERSED AND SET ASIDE.
SO ORDERED.
UYPITCHING VS QUIAMCO 2006
Honeste vivere, non alterum laedere et jus suum cuique tribuere. To live virtuously, not to injure others and to give everyone his due. These supreme norms
of justice are the underlying principles of law and order in society. We reaffirm them in this petition for review on certiorari assailing the July 26, 2000 decision1
and October 18, 2000 resolution of the Court of Appeals (CA) in CA-G.R. CV No. 47571.
109
In 1982, respondent Ernesto C. Quiamco was approached by Juan Davalan,2 Josefino Gabutero and Raul Generoso to amicably settle the civil aspect of a
criminal case for robbery3 filed by Quiamco against them. They surrendered to him a red Honda XL-100 motorcycle and a photocopy of its certificate of
registration. Respondent asked for the original certificate of registration but the three accused never came to see him again. Meanwhile, the motorcycle was
parked in an open space inside respondents business establishment, Avesco-AVNE Enterprises, where it was visible and accessible to the public.
It turned out that, in October 1981, the motorcycle had been sold on installment basis to Gabutero by petitioner Ramas Uypitching Sons, Inc., a family-owned
corporation managed by petitioner Atty. Ernesto Ramas Uypitching. To secure its payment, the motorcycle was mortgaged to petitioner corporation.4
When Gabutero could no longer pay the installments, Davalan assumed the obligation and continued the payments. In September 1982, however, Davalan
stopped paying the remaining installments and told petitioner corporations collector, Wilfredo Verao, that the motorcycle had allegedly been "taken by
respondents men."
Nine years later, on January 26, 1991, petitioner Uypitching, accompanied by policemen,5 went to Avesco-AVNE Enterprises to recover the motorcycle. The
leader of the police team, P/Lt. Arturo Vendiola, talked to the clerk in charge and asked for respondent. While P/Lt. Vendiola and the clerk were talking,
petitioner Uypitching paced back and forth inside the establishment uttering "Quiamco is a thief of a motorcycle."
On learning that respondent was not in Avesco-AVNE Enterprises, the policemen left to look for respondent in his residence while petitioner Uypitching stayed
in the establishment to take photographs of the motorcycle. Unable to find respondent, the policemen went back to Avesco-AVNE Enterprises and, on
petitioner Uypitchings instruction and over the clerks objection, took the motorcycle.
On February 18, 1991, petitioner Uypitching filed a criminal complaint for qualified theft and/or violation of the Anti-Fencing Law6 against respondent in the
Office of the City Prosecutor of Dumaguete City.7 Respondent moved for dismissal because the complaint did not charge an offense as he had neither stolen
nor bought the motorcycle. The Office of the City Prosecutor dismissed the complaint8 and denied petitioner Uypitchings subsequent motion for
reconsideration.
Respondent filed an action for damages against petitioners in the RTC of Dumaguete City, Negros Oriental, Branch 37.9 He sought to hold the petitioners
liable for the following: (1) unlawful taking of the motorcycle; (2) utterance of a defamatory remark (that respondent was a thief) and (3) precipitate filing of a
baseless and malicious complaint. These acts humiliated and embarrassed the respondent and injured his reputation and integrity.
On July 30, 1994, the trial court rendered a decision10 finding that petitioner Uypitching was motivated with malice and ill will when he called respondent a
thief, took the motorcycle in an abusive manner and filed a baseless complaint for qualified theft and/or violation of the Anti-Fencing Law. Petitioners acts
were found to be contrary to Articles 1911 and 2012 of the Civil Code. Hence, the trial court held petitioners liable to respondent for P500,000 moral damages,
P200,000 exemplary damages and P50,000 attorneys fees plus costs.
Petitioners appealed the RTC decision but the CA affirmed the trial courts decision with modification, reducing the award of moral and exemplary damages
to P300,000 and P100,000, respectively.13 Petitioners sought reconsideration but it was denied. Thus, this petition.
110
In their petition and memorandum, petitioners submit that the sole (allegedly) issue to be resolved here is whether the filing of a complaint for qualified theft
and/or violation of the Anti-Fencing Law in the Office of the City Prosecutor warranted the award of moral damages, exemplary damages, attorneys fees and
costs in favor of respondent.
Petitioners suggestion is misleading. They were held liable for damages not only for instituting a groundless complaint against respondent but also for making
a slanderous remark and for taking the motorcycle from respondents establishment in an abusive manner.
Correctness of the Findings of the RTC and CA
As they never questioned the findings of the RTC and CA that malice and ill will attended not only the public imputation of a crime to respondent14 but also
the taking of the motorcycle, petitioners were deemed to have accepted the correctness of such findings. This alone was sufficient to hold petitioners liable
for damages to respondent.
Nevertheless, to address petitioners concern, we also find that the trial and appellate courts correctly ruled that the filing of the complaint was tainted with
malice and bad faith. Petitioners themselves in fact described their action as a "precipitate act."15 Petitioners were bent on portraying respondent as a thief.
In this connection, we quote with approval the following findings of the RTC, as adopted by the CA:
x x x There was malice or ill-will [in filing the complaint before the City Prosecutors Office] because Atty. Ernesto Ramas Uypitching knew or ought to have
known as he is a lawyer, that there was no probable cause at all for filing a criminal complaint for qualified theft and fencing activity against [respondent]. Atty.
Uypitching had no personal knowledge that [respondent] stole the motorcycle in question. He was merely told by his bill collector ([i.e.] the bill collector of
Ramas Uypitching Sons, Inc.)[,] Wilfredo Verao[,] that Juan Dabalan will [no longer] pay the remaining installment(s) for the motorcycle because the
motorcycle was taken by the men of [respondent]. It must be noted that the term used by Wilfredo Verao in informing Atty. Ernesto Ramas Uypitching of the
refusal of Juan Dabalan to pay for the remaining installment was []taken[], not []unlawfully taken[] or stolen. Yet, despite the double hearsay, Atty. Ernesto
Ramas Uypitching not only executed the [complaint-affidavit] wherein he named [respondent] as the suspect of the stolen motorcycle but also charged
[respondent] of qualified theft and fencing activity before the City [Prosecutors] Office of Dumaguete. The absence of probable cause necessarily signifies
the presence of malice. What is deplorable in all these is that Juan Dabalan, the owner of the motorcycle, did not accuse [respondent] or the latters men of
stealing the motorcycle[,] much less bother[ed] to file a case for qualified theft before the authorities. That Atty. Uypitchings act in charging [respondent] with
qualified theft and fencing activity is tainted with malice is also shown by his answer to the question of Cupid Gonzaga16 [during one of their conversations] -
"why should you still file a complaint? You have already recovered the motorcycle"[:] "Aron motagam ang kawatan ug motor." ("To teach a lesson to the
thief of motorcycle.")17
Moreover, the existence of malice, ill will or bad faith is a factual matter. As a rule, findings of fact of the trial court, when affirmed by the appellate court, are
conclusive on this Court. We see no compelling reason to reverse the findings of the RTC and the CA.
Petitioners Abused Their Right of Recovery as Mortgagee(s)
Petitioners claim that they should not be held liable for petitioner corporations exercise of its right as seller-mortgagee to recover the mortgaged vehicle
preliminary to the enforcement of its right to foreclose on the mortgage in case of default. They are clearly mistaken.
111
True, a mortgagee may take steps to recover the mortgaged property to enable it to enforce or protect its foreclosure right thereon. There is, however, a well-
defined procedure for the recovery of possession of mortgaged property: if a mortgagee is unable to obtain possession of a mortgaged property for its sale
on foreclosure, he must bring a civil action either to recover such possession as a preliminary step to the sale, or to obtain judicial foreclosure.18
Petitioner corporation failed to bring the proper civil action necessary to acquire legal possession of the motorcycle. Instead, petitioner Uypitching descended
on respondents establishment with his policemen and ordered the seizure of the motorcycle without a search warrant or court order. Worse, in the course of
the illegal seizure of the motorcycle, petitioner Uypitching even mouthed a slanderous statement.
No doubt, petitioner corporation, acting through its co-petitioner Uypitching, blatantly disregarded the lawful procedure for the enforcement of its right, to the
prejudice of respondent. Petitioners acts violated the law as well as public morals, and transgressed the proper norms of human relations.
The basic principle of human relations, embodied in Article 19 of the Civil Code, provides:
Art. 19. Every person must in the exercise of his rights and in the performance of his duties, act with justice, give every one his due, and observe honesty and
good faith.
Article 19, also known as the "principle of abuse of right," prescribes that a person should not use his right unjustly or contrary to honesty and good faith,
otherwise he opens himself to liability.19 It seeks to preclude the use of, or the tendency to use, a legal right (or duty) as a means to unjust ends.
There is an abuse of right when it is exercised solely to prejudice or injure another.20 The exercise of a right must be in accordance with the purpose for
which it was established and must not be excessive or unduly harsh; there must be no intention to harm another.21 Otherwise, liability for damages to the
injured party will attach.
In this case, the manner by which the motorcycle was taken at petitioners instance was not only attended by bad faith but also contrary to the procedure laid
down by law. Considered in conjunction with the defamatory statement, petitioners exercise of the right to recover the mortgaged vehicle was utterly prejudicial
and injurious to respondent. On the other hand, the precipitate act of filing an unfounded complaint could not in any way be considered to be in accordance
with the purpose for which the right to prosecute a crime was established. Thus, the totality of petitioners actions showed a calculated design to embarrass,
humiliate and publicly ridicule respondent. Petitioners acted in an excessively harsh fashion to the prejudice of respondent. Contrary to law, petitioners willfully
caused damage to respondent. Hence, they should indemnify him.22
WHEREFORE, the petition is hereby DENIED. The July 26, 2000 decision and October 18, 2000 resolution of the Court of Appeals in CA-G.R. CV No. 47571
are AFFIRMED.
Triple costs against petitioners, considering that petitioner Ernesto Ramas Uypitching is a lawyer and an officer of the court, for his improper behavior.
SO ORDERED.
112
CEBU COUNTRY CLUB VS ELIZAGAQUE 2008
For our resolution is the instant Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the Decision1
dated January 31, 2003 and Resolution dated October 2, 2003 of the Court of Appeals in CA-G.R. CV No. 71506.
The facts are:
Cebu Country Club, Inc. (CCCI), petitioner, is a domestic corporation operating as a non-profit and non-stock private membership club, having its principal
place of business in Banilad, Cebu City. Petitioners herein are members of its Board of Directors.
Sometime in 1987, San Miguel Corporation, a special company proprietary member of CCCI, designated respondent Ricardo F. Elizagaque, its Senior Vice
President and Operations Manager for the Visayas and Mindanao, as a special non-proprietary member. The designation was thereafter approved by the
CCCIs Board of Directors.
In 1996, respondent filed with CCCI an application for proprietary membership. The application was indorsed by CCCIs two (2) proprietary members, namely:
Edmundo T. Misa and Silvano Ludo.
As the price of a proprietary share was around the P5 million range, Benito Unchuan, then president of CCCI, offered to sell respondent a share for only P3.5
million. Respondent, however, purchased the share of a certain Dr. Butalid for only P3 million. Consequently, on September 6, 1996, CCCI issued Proprietary
Ownership Certificate No. 1446 to respondent.
During the meetings dated April 4, 1997 and May 30, 1997 of the CCCI Board of Directors, action on respondents application for proprietary membership
was deferred. In another Board meeting held on July 30, 1997, respondents application was voted upon. Subsequently, or on August 1, 1997, respondent
received a letter from Julius Z. Neri, CCCIs corporate secretary, informing him that the Board disapproved his application for proprietary membership.
On August 6, 1997, Edmundo T. Misa, on behalf of respondent, wrote CCCI a letter of reconsideration. As CCCI did not answer, respondent, on October 7,
1997, wrote another letter of reconsideration. Still, CCCI kept silent. On November 5, 1997, respondent again sent CCCI a letter inquiring whether any member
of the Board objected to his application. Again, CCCI did not reply.
Consequently, on December 23, 1998, respondent filed with the Regional Trial Court (RTC), Branch 71, Pasig City a complaint for damages against petitioners,
docketed as Civil Case No. 67190.
After trial, the RTC rendered its Decision dated February 14, 2001 in favor of respondent, thus:
WHEREFORE, judgment is hereby rendered in favor of plaintiff:
1. Ordering defendants to pay, jointly and severally, plaintiff the amount of P2,340,000.00 as actual or compensatory damages.
2. Ordering defendants to pay, jointly and severally, plaintiff the amount of P5,000,000.00 as moral damages.
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3. Ordering defendants to pay, jointly and severally, plaintiff the amount of P1,000,000.00 as exemplary damages.
4. Ordering defendants to pay, jointly and severally, plaintiff the amount of P1,000,000.00 as and by way of attorneys fees and P80,000.00 as litigation
expenses.
5. Costs of suit.
Counterclaims are hereby DISMISSED for lack of merit.
SO ORDERED.2
On appeal by petitioners, the Court of Appeals, in its Decision dated January 31, 2003, affirmed the trial courts Decision with modification, thus:
WHEREFORE, premises considered, the assailed Decision dated February 14, 2001 of the Regional Trial Court, Branch 71, Pasig City in Civil Case No.
67190 is hereby AFFIRMED with MODIFICATION as follows:
1. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the amount of P2,000,000.00 as moral damages;
2. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the amount of P1,000,000.00 as exemplary damages;
3. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the mount of P500,000.00 as attorneys fees and P50,000.00 as litigation
expenses; and
4. Costs of the suit.
The counterclaims are DISMISSED for lack of merit.
SO ORDERED.3
On March 3, 2003, petitioners filed a motion for reconsideration and motion for leave to set the motion for oral arguments. In its Resolution4 dated October 2,
2003, the appellate court denied the motions for lack of merit.
Hence, the present petition.
The issue for our resolution is whether in disapproving respondents application for proprietary membership with CCCI, petitioners are liable to respondent for
damages, and if so, whether their liability is joint and several.
Petitioners contend, inter alia, that the Court of Appeals erred in awarding exorbitant damages to respondent despite the lack of evidence that they acted in
bad faith in disapproving the latters application; and in disregarding their defense of damnum absque injuria.
For his part, respondent maintains that the petition lacks merit, hence, should be denied.
CCCIs Articles of Incorporation provide in part:
SEVENTH: That this is a non-stock corporation and membership therein as well as the right of participation in its assets shall be limited to qualified persons
who are duly accredited owners of Proprietary Ownership Certificates issued by the corporation in accordance with its By-Laws.
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Corollary, Section 3, Article 1 of CCCIs Amended By-Laws provides:
SECTION 3. HOW MEMBERS ARE ELECTED The procedure for the admission of new members of the Club shall be as follows:
(a) Any proprietary member, seconded by another voting proprietary member, shall submit to the Secretary a written proposal for the admission of a candidate
to the "Eligible-for-Membership List";
(b) Such proposal shall be posted by the Secretary for a period of thirty (30) days on the Club bulletin board during which time any member may interpose
objections to the admission of the applicant by communicating the same to the Board of Directors;
(c) After the expiration of the aforesaid thirty (30) days, if no objections have been filed or if there are, the Board considers the objections unmeritorious, the
candidate shall be qualified for inclusion in the "Eligible-for-Membership List";
(d) Once included in the "Eligible-for-Membership List" and after the candidate shall have acquired in his name a valid POC duly recorded in the books of the
corporation as his own, he shall become a Proprietary Member, upon a non-refundable admission fee of P1,000.00, provided that admission fees will only be
collected once from any person.
On March 1, 1978, Section 3(c) was amended to read as follows:
(c) After the expiration of the aforesaid thirty (30) days, the Board may, by unanimous vote of all directors present at a regular or special meeting, approve
the inclusion of the candidate in the "Eligible-for-Membership List".
As shown by the records, the Board adopted a secret balloting known as the "black ball system" of voting wherein each member will drop a ball in the ballot
box. A white ball represents conformity to the admission of an applicant, while a black ball means disapproval. Pursuant to Section 3(c), as amended, cited
above, a unanimous vote of the directors is required. When respondents application for proprietary membership was voted upon during the Board meeting
on July 30, 1997, the ballot box contained one (1) black ball. Thus, for lack of unanimity, his application was disapproved.
Obviously, the CCCI Board of Directors, under its Articles of Incorporation, has the right to approve or disapprove an application for proprietary membership.
But such right should not be exercised arbitrarily. Articles 19 and 21 of the Civil Code on the Chapter on Human Relations provide restrictions, thus:
Article 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty
and good faith.
Article 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate
the latter for the damage.
In GF Equity, Inc. v. Valenzona,5 we expounded Article 19 and correlated it with Article 21, thus:
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This article, known to contain what is commonly referred to as the principle of abuse of rights, sets certain standards which must be observed not only in the
exercise of one's rights but also in the performance of one's duties. These standards are the following: to act with justice; to give everyone his due; and to
observe honesty and good faith. The law, therefore, recognizes a primordial limitation on all rights; that in their exercise, the norms of human conduct set forth
in Article 19 must be observed. A right, though by itself legal because recognized or granted by law as such, may nevertheless become the source of some
illegality. When a right is exercised in a manner which does not conform with the norms enshrined in Article 19 and results in damage to another, a legal
wrong is thereby committed for which the wrongdoer must be held responsible. But while Article 19 lays down a rule of conduct for the government of human
relations and for the maintenance of social order, it does not provide a remedy for its violation. Generally, an action for damages under either Article 20 or
Article 21 would be proper. (Emphasis in the original)
In rejecting respondents application for proprietary membership, we find that petitioners violated the rules governing human relations, the basic principles to
be observed for the rightful relationship between human beings and for the stability of social order. The trial court and the Court of Appeals aptly held that
petitioners committed fraud and evident bad faith in disapproving respondents applications. This is contrary to morals, good custom or public policy. Hence,
petitioners are liable for damages pursuant to Article 19 in relation to Article 21 of the same Code.
It bears stressing that the amendment to Section 3(c) of CCCIs Amended By-Laws requiring the unanimous vote of the directors present at a special or
regular meeting was not printed on the application form respondent filled and submitted to CCCI. What was printed thereon was the original provision of
Section 3(c) which was silent on the required number of votes needed for admission of an applicant as a proprietary member.
Petitioners explained that the amendment was not printed on the application form due to economic reasons. We find this excuse flimsy and unconvincing.
Such amendment, aside from being extremely significant, was introduced way back in 1978 or almost twenty (20) years before respondent filed his application.
We cannot fathom why such a prestigious and exclusive golf country club, like the CCCI, whose members are all affluent, did not have enough money to
cause the printing of an updated application form.
It is thus clear that respondent was left groping in the dark wondering why his application was disapproved. He was not even informed that a unanimous vote
of the Board members was required. When he sent a letter for reconsideration and an inquiry whether there was an objection to his application, petitioners
apparently ignored him. Certainly, respondent did not deserve this kind of treatment. Having been designated by San Miguel Corporation as a special non-
proprietary member of CCCI, he should have been treated by petitioners with courtesy and civility. At the very least, they should have informed him why his
application was disapproved.
The exercise of a right, though legal by itself, must nonetheless be in accordance with the proper norm. When the right is exercised arbitrarily, unjustly or
excessively and results in damage to another, a legal wrong is committed for which the wrongdoer must be held responsible.6 It bears reiterating that the trial
court and the Court of Appeals held that petitioners disapproval of respondents application is characterized by bad faith.
As to petitioners reliance on the principle of damnum absque injuria or damage without injury, suffice it to state that the same is misplaced. In Amonoy v.
Gutierrez,7 we held that this principle does not apply when there is an abuse of a persons right, as in this case.
As to the appellate courts award to respondent of moral damages, we find the same in order. Under Article 2219 of the New Civil Code, moral damages may
be recovered, among others, in acts and actions referred to in Article 21. We believe respondents testimony that he suffered mental anguish, social humiliation
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and wounded feelings as a result of the arbitrary denial of his application. However, the amount of P2,000,000.00 is excessive. While there is no hard-and-
fast rule in determining what would be a fair and reasonable amount of moral damages, the same should not be palpably and scandalously excessive. Moral
damages are not intended to impose a penalty to the wrongdoer, neither to enrich the claimant at the expense of the defendant.8 Taking into consideration
the attending circumstances here, we hold that an award to respondent of P50,000.00, instead of P2,000,000.00, as moral damages is reasonable.
Anent the award of exemplary damages, Article 2229 allows it by way of example or correction for the public good. Nonetheless, since exemplary damages
are imposed not to enrich one party or impoverish another but to serve as a deterrent against or as a negative incentive to curb socially deleterious actions,9
we reduce the amount from P1,000,000.00 to P25,000.00 only.
On the matter of attorneys fees and litigation expenses, Article 2208 of the same Code provides, among others, that attorneys fees and expenses of litigation
may be recovered in cases when exemplary damages are awarded and where the court deems it just and equitable that attorneys fees and expenses of
litigation should be recovered, as in this case. In any event, however, such award must be reasonable, just and equitable. Thus, we reduce the amount of
attorneys fees (P500,000.00) and litigation expenses (P50,000.00) to P50,000.00 and P25,000.00, respectively.
Lastly, petitioners argument that they could not be held jointly and severally liable for damages because only one (1) voted for the disapproval of respondents
application lacks merit.
Section 31 of the Corporation Code provides:
SEC. 31. Liability of directors, trustees or officers. Directors or trustees who willfully and knowingly vote for or assent to patently unlawful acts of the
corporation or who are guilty of gross negligence or bad faith in directing the affairs of the corporation or acquire any personal or pecuniary interest in conflict
with their duty as such directors, or trustees shall be liable jointly and severally for all damages resulting therefrom suffered by the corporation, its stockholders
or members and other persons. (Emphasis ours)
WHEREFORE, we DENY the petition. The challenged Decision and Resolution of the Court of Appeals in CA-G.R. CV No. 71506 are AFFIRMED with
modification in the sense that (a) the award of moral damages is reduced from P2,000,000.00 to P50,000.00; (b) the award of exemplary damages is reduced
from P1,000,000.00 to P25,000.00; and (c) the award of attorneys fees and litigation expenses is reduced from P500,000.00 and P50,000.00 to P50,000.00
and P25,000.00, respectively.
Costs against petitioners.
SO ORDERED.
CALATAGAN GOLF CLUB VS CLEMENTE JR. 2009
Seeking the reversal of the Decision[1] dated 1 June 2004 of the Court of Appeals in CA-G.R. SP No. 62331 and the reinstatement of the Decision dated 15
November 2000 of the Securities and Exchange Commission (SEC) in SEC Case No. 04-98-5954, petitioner Calatagan Golf Club, Inc. (Calatagan) filed this
Rule 45 petition against respondent Sixto Clemente, Jr. (Clemente).
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The key facts are undisputed.
Clemente applied to purchase one share of stock of Calatagan, indicating in his application for membership his mailing address at Phimco Industries, Inc.
P.O. Box 240, MCC, complete residential address, office and residence telephone numbers, as well as the company (Phimco) with which he was connected,
Calatagan issued to him Certificate of Stock No. A-01295 on 2 May 1990 after paying P120,000.00 for the share.[2]
Calatagan charges monthly dues on its members to meet expenses for general operations, as well as costs for upkeep and improvement of the grounds and
facilities. The provision on monthly dues is incorporated in Calatagans Articles of Incorporation and By-Laws. It is also reproduced at the back of each
certificate of stock.[3] As reproduced in the dorsal side of Certificate of Stock No. A-01295, the provision reads:
5. The owners of shares of stock shall be subject to the payment of monthly dues in an amount as may be prescribed in the by-laws or by the Board of
Directors which shall in no case be less that [sic] P50.00 to meet the expenses for the general operations of the club, and the maintenance and improvement
of its premises and facilities, in addition to such fees as may be charged for the actual use of the facilities x x x
When Clemente became a member the monthly charge stood at P400.00. He paid P3,000.00 for his monthly dues on 21 March 1991 and another P5,400.00
on 9 December 1991. Then he ceased paying the dues. At that point, his balance amounted to P400.00.[4]
Ten (10) months later, Calatagan made the initial step to collect Clementes back accounts by sending a demand letter dated 21 September 1992. It was
followed by a second letter dated 22 October 1992. Both letters were sent to Clementes mailing address as indicated in his membership application but were
sent back to sender with the postal note that the address had been closed.[5]
Calatagan declared Clemente delinquent for having failed to pay his monthly dues for more than sixty (60) days, specifically P5,600.00 as of 31 October 1992.
Calatagan also included Clementes name in the list of delinquent members posted on the clubs bulletin board. On 1 December 1992, Calatagans board of
directors adopted a resolution authorizing the foreclosure of shares of delinquent members, including Clementes; and the public auction of these shares.
On 7 December 1992, Calatagan sent a third and final letter to Clemente, this time signed by its Corporate Secretary, Atty. Benjamin Tanedo, Jr. The letter
contains a warning that unless Clemente settles his outstanding dues, his share would be included among the delinquent shares to be sold at public auction
on 15 January 1993. Again, this letter was sent to Clementes mailing address that had already been closed.[6]
On 5 January 1993, a notice of auction sale was posted on the Clubs bulletin board, as well as on the clubs premises. The auction sale took place as
scheduled on 15 January 1993, and Clementes share sold for P64,000.[7] According to the Certificate of Sale issued by Calatagan after the sale, Clementes
share was purchased by a Nestor A. Virata.[8] At the time of the sale, Clementes accrued monthly dues amounted to P5,200.00.[9] A notice of foreclosure of
Clementes share was published in the 26 May 1993 issue of the Business World.[10]
Clemente learned of the sale of his share only in November of 1997.[11] He filed a claim with the Securities and Exchange Commission (SEC) seeking the
restoration of his shareholding in Calatagan with damages.
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On 15 November 2000, the SEC rendered a decision dismissing Clementes complaint. Citing Section 69 of the Corporation Code which provides that the sale
of shares at an auction sale can only be questioned within six (6) months from the date of sale, the SEC concluded that Clementes claim, filed four (4) years
after the sale, had already prescribed. The SEC further held that Calatagan had complied with all the requirements for a valid sale of the subject share,
Clemente having failed to inform Calatagan that the address he had earlier supplied was no longer his address. Clemente, the SEC ruled, had acted in bad
faith in assuming as he claimed that his non-payment of monthly dues would merely render his share inactive.
Clemente filed a petition for review with the Court of Appeals. On 1 June 2004, the Court of Appeals promulgated a decision reversing the SEC. The appellate
court restored Clementes one share with a directive to Calatagan to issue in his a new share, and awarded to Clemente a total of P400,000.00 in damages,
less the unpaid monthly dues of P5,200.00.
In rejecting the SECs finding that the action had prescribed, the Court of Appeals cited the SECs own ruling in SEC Case No. 4160, Caram v. Valley Golf
Country Club, Inc., that Section 69 of the Corporation Code specifically refers to unpaid subscriptions to capital stock, and not to any other debt of stockholders.
With the insinuation that Section 69 does not apply to unpaid membership dues in non-stock corporations, the appellate court employed Article 1140 of the
Civil Code as the proper rule of prescription. The provision sets the prescription period of actions to recover movables at eight (8) years.
The Court of Appeals also pointed out that since that Calatagans first two demand letters had been returned to it as sender with the notation about the closure
of the mailing address, it very well knew that its third and final demand letter also sent to the same mailing address would not be received by Clemente. It
noted the by-law requirement that within ten (10) days after the Board has ordered the sale at auction of a members share of stock for indebtedness, the
Corporate Secretary shall notify the owner thereof and advise the Membership Committee of such fact. Finally, the Court of Appeals ratiocinated that a person
who is in danger of the imminent loss of his property has the right to be notified and be given the chance to prevent the loss.[12]
Hence, the present appeal.
Calatagan maintains that the action of Clemente had prescribed pursuant to Section 69 of the Corporation Code, and that the requisite notices under both the
law and the by-laws had been rendered to Clemente.
Section 69 of the Code provides that an action to recover delinquent stock sold must be commenced by the filing of a complaint within six (6) months from
the date of sale. As correctly pointed out by the Court of Appeals, Section 69 is part of Title VIII of the Code entitled Stocks and Stockholders and refers
specifically to unpaid subscriptions to capital stock, the sale of which is governed by the immediately preceding Section 68.
The Court of Appeals debunked both Calatagans and the SECs reliance on Section 69 by citing another SEC ruling in the case of Caram v. Valley Golf. In
connection with Section 69, Calatagan raises a peripheral point made in the SECs Caram ruling. In Caram, the SEC, using as take-off Section 6 of the
Corporation Code which refers to such rights, privileges or restrictions as may be stated in the articles of incorporation, pointed out that the Articles of
Incorporation of Valley Golf does not impose any lien, liability or restriction on the Golf Share [of Caram], but only its (Valley Golfs) By-Laws does. Here,
Calatagan stresses that its own Articles of Incorporation does provide that the monthly dues assessed on owners of shares of the corporation, along with all
other obligations of the shareholders to the club, shall constitute a first lien on the shares and in the event of delinquency such shares may be ordered sold
by the Board of Directors in the manner provided in the By-Laws to satisfy said dues or other obligations of the shareholders.[13] With its illative but
119
incomprehensible logic, Calatagan concludes that the prescriptive period under Section 69 should also apply to the sale of Clementes share as the lien that
Calatagan perceives to be a restriction is stated in the articles of incorporation and not only in the by-laws.
We remain unconvinced.
There are fundamental differences that defy equivalence or even analogy between the sale of delinquent stock under Section 68 and the sale that occurred
in this case. At the root of the sale of delinquent stock is the non-payment of the subscription price for the share of stock itself. The stockholder or subscriber
has yet to fully pay for the value of the share or shares subscribed. In this case, Clemente had already fully paid for the share in Calatagan and no longer had
any outstanding obligation to deprive him of full title to his share. Perhaps the analogy could have been made if Clemente had not yet fully paid for his share
and the non-stock corporation, pursuant to an article or by-law provision designed to address that situation, decided to sell such share as a consequence. But
that is not the case here, and there is no purpose for us to apply Section 69 to the case at bar.
Calatagan argues in the alternative that Clementes suit is barred by Article 1146 of the Civil Code which establishes four (4) years as the prescriptive period
for actions based upon injury to the rights of the plaintiff on the hypothesis that the suit is purely for damages. As a second alternative still, Calatagan posits
that Clementes action is governed by Article 1149 of the Civil Code which sets five (5) years as the period of prescription for all other actions whose prescriptive
periods are not fixed in the Civil Code or in any other law. Neither article is applicable but Article 1140 of the Civil Code which provides that an action to
recover movables shall prescribe in eight (8) years. Calatagans action is for the recovery of a share of stock, plus damages.
Calatagans advertence to the fact that the constitution of a lien on the members share by virtue of the explicit provisions in its Articles of Incorporation and
By-Laws is relevant but ultimately of no help to its cause. Calatagans Articles of Incorporation states that the dues, together with all other obligations of
members to the club, shall constitute a first lien on the shares, second only to any lien in favor of the national or local government, and in the event of
delinquency such shares may be ordered sold by the Board of Directors in the manner provided in the By-Laws to satisfy said dues or other obligations of the
stockholders.[14] In turn, there are several provisions in the By-laws that govern the payment of dues, the lapse into delinquency of the member, and the
constitution and execution on the lien. We quote these provisions:
ARTICLE XII MEMBERS ACCOUNT
SEC. 31. (a) Billing Members, Posting of Delinquent Members The Treasurer shall bill al members monthly. As soon as possible after the end of every month,
a statement showing the account of bill of a member for said month will be prepared and sent to him. If the bill of any member remains unpaid by the 20th of
the month following that in which the bill was incurred, the Treasurer shall notify him that if his bill is not paid in full by the end of the succeeding month his
name will be posted as delinquent the following day at the Clubhouse bulletin board. While posted, a member, the immediate members of his family, and his
guests, may not avail of the facilities of the Club.
(b) Members on the delinquent list for more than 60 days shall be reported to the Board and their shares or the shares of the juridical entities they represent
shall thereafter be ordered sold by the Board at auction to satisfy the claims of the Club as provided for in Section 32 hereon. A member may pay his overdue
account at any time before the auction sale.
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Sec. 32. Lien on Shares; Sale of Share at Auction- The club shall have a first lien on every share of stock to secure debts of the members to the Club. This
lien shall be annotated on the certificates of stock and may be enforced by the Club in the following manner:
(a) Within ten (10) days after the Board has ordered the sale at auction of a members share of stock for indebtedness under Section 31(b) hereof, the
Secretary shall notify the owner thereof, and shall advise the Membership Committee of such fact.
(b) The Membership Committee shall then notify all applicants on the Waiting List and all registered stockholders of the availability of a share of stock for sale
at auction at a specified date, time and place, and shall post a notice to that effect in the Club bulletin board for at least ten (10) days prior to the auction sale.
(c) On the date and hour fixed, the Membership Committee shall proceed with the auction by viva voce bidding and award the sale of the share of stock to
the highest bidder.
(d) The purchase price shall be paid by the winning bidder to the Club within twenty-four (24) hours after the bidding. The winning bidder or the representative
in the case of a juridical entity shall become a Regular Member upon payment of the purchase price and issuance of a new stock certificate in his name or in
the name of the juridical entity he represents. The proceeds of the sale shall be paid by the Club to the selling stockholder after deducting his obligations to
the Club.
(e) If no bids be received or if the winning bidder fails to pay the amount of this bid within twenty-four (24) hours after the bidding, the auction procedures
may be repeated from time to time at the discretion of the Membership Committee until the share of stock be sold.
(f) If the proceeds from the sale of the share of stock are not sufficient to pay in full the indebtedness of the member, the member shall continue to be
obligated to the Club for the unpaid balance. If the member whose share of stock is sold fails or refuse to surrender the stock certificate for cancellation,
cancellation shall be effected in the books of the Club based on a record of the proceedings. Such cancellation shall render the unsurrendered stock certificate
null and void and notice to this effect shall be duly published.
It is plain that Calatagan had endeavored to install a clear and comprehensive procedure to govern the payment of monthly dues, the declaration of a member
as delinquent, and the constitution of a lien on the shares and its eventual public sale to answer for the members debts. Under Section 91 of the Corporation
Code, membership in a non-stock corporation shall be terminated in the manner and for the causes provided in the articles of incorporation or the by-laws.
The By-law provisions are elaborate in explaining the manner and the causes for the termination of membership in Calatagan, through the execution on the
lien of the share. The Court is satisfied that the By-Laws, as written, affords due protection to the member by assuring that the member should be notified by
the Secretary of the looming execution sale that would terminate membership in the club. In addition, the By-Laws guarantees that after the execution sale,
the proceeds of the sale would be returned to the former member after deducting the outstanding obligations. If followed to the letter, the termination of
membership under this procedure outlined in the By-Laws would accord with substantial justice.
Yet, did Calatagan actually comply with the by-law provisions when it sold Clementes share? The appellate courts finding on this point warrants our approving
citation, thus:
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In accordance with this provision, Calatagan sent the third and final demand letter to Clemente on December 7, 1992. The letter states that if the amount of
delinquency is not paid, the share will be included among the delinquent shares to be sold at public auction. This letter was signed by Atty. Benjamin Tanedo,
Jr., Calatagan Golfs Corporate Secretary. It was again sent to Clementes mailing address Phimco Industries Inc., P.O. Box 240, MCC Makati. As expected,
it was returned because the post office box had been closed.
Under the By-Laws, the Corporate Secretary is tasked to give or cause to be given, all notices required by law or by these By-Laws. .. and keep a record of
the addresses of all stockholders. As quoted above, Sec. 32 (a) of the By-Laws further provides that within ten (10) days after the Board has ordered the sale
at auction of a members share of stock for indebtedness under Section 31 (b) hereof, the Secretary shall notify the owner thereof and shall advise the
Membership Committee of such fact., The records do not disclose what report the Corporate Secretary transmitted to the Membership Committee to comply
with Section 32(a). Obviously, the reason for this mandatory requirement is to give the Membership Committee the opportunity to find out, before the share is
sold, if proper notice has been made to the shareholder member.
We presume that the Corporate Secretary, as a lawyer is knowledgeable on the law and on the standards of good faith and fairness that the law requires. As
custodian of corporate records, he should also have known that the first two letters sent to Clemente were returned because the P.O. Box had been closed.
Thus, we are surprised given his knowledge of the law and of corporate records that he would send the third and final letter Clementes last chance before his
share is sold and his membership lost to the same P.O. Box that had been closed.
Calatagan argues that it exercised due diligence before the foreclosure sale and sent several notices to Clementes specified mailing address. We do not
agree; we cannot label as due diligence Calatagans act of sending the December 7, 1992 letter to Clementes mailing address knowing fully well that the P.O.
Box had been closed. Due diligence or good faith imposes upon the Corporate Secretary the chief repository of all corporate records the obligation to check
Clementes other address which, under the By-Laws, have to be kept on file and are in fact on file. One obvious purpose of giving the Corporate Secretary the
duty to keep the addresses of members on file is specifically for matters of this kind, when the member cannot be reached through his or her mailing address.
Significantly, the Corporate Secretary does not have to do the actual verification of other addressees on record; a mere clerk can do the very simple task of
checking the files as in fact clerks actually undertake these tasks. In fact, one telephone call to Clementes phone numbers on file would have alerted him of
his impending loss.
Ultimately, the petition must fail because Calatagan had failed to duly observe both the spirit and letter of its own by-laws. The by-law provisions was clearly
conceived to afford due notice to the delinquent member of the impending sale, and not just to provide an intricate faade that would facilitate Calatagans sale
of the share. But then, the bad faith on Calatagans part is palpable. As found by the Court of Appeals, Calatagan very well knew that Clementes postal box
to which it sent its previous letters had already been closed, yet it persisted in sending that final letter to the same postal box. What for? Just for the exercise,
it appears, as it had known very well that the letter would never actually reach Clemente.
It is noteworthy that Clemente in his membership application had provided his residential address along with his residence and office telephone numbers.
Nothing in Section 32 of Calatagans By-Laws requires that the final notice prior to the sale be made solely through the members mailing address. Clemente
cites our aphorism-like pronouncement in Rizal Commercial Banking Corporation v. Court of Appeals[15] that [a] simple telephone call and an ounce of good
faith x x x could have prevented this present controversy. That memorable observation is quite apt in this case.
Calatagans bad faith and failure to observe its own By-Laws had resulted not merely in the loss of Clementes privilege to play golf at its golf course and avail
of its amenities, but also in significant pecuniary damage to him. For that loss, the only blame that could be thrown Clementes way was his failure to notify
122
Calatagan of the closure of the P.O. Box. That lapse, if we uphold Calatagan would cost Clemente a lot. But, in the first place, does he deserve answerability
for failing to notify the club of the closure of the postal box? Indeed, knowing as he did that Calatagan was in possession of his home address as well as
residence and office telephone numbers, he had every reason to assume that the club would not be at a loss should it need to contact him. In addition,
according to Clemente, he was not even aware of the closure of the postal box, the maintenance of which was not his responsibility but his employer Phimcos.
The utter bad faith exhibited by Calatagan brings into operation Articles 19, 20 and 21 of the Civil Code,[16] under the Chapter on Human Relations. These
provisions, which the Court of Appeals did apply, enunciate a general obligation under law for every person to act fairly and in good faith towards one another.
A non-stock corporation like Calatagan is not exempt from that obligation in its treatment of its members. The obligation of a corporation to treat every person
honestly and in good faith extends even to its shareholders or members, even if the latter find themselves contractually bound to perform certain obligations
to the corporation. A certificate of stock cannot be a charter of dehumanization.
We turn to the matter of damages. The award of actual damages is of course warranted since Clemente has sustained pecuniary injury by reason of
Calatagans wrongful violation of its own By-Laws. It would not be feasible to deliver Clementes original Certificate of Stock because it had already been
cancelled and a new one issued in its place in the name of the purchases at the auction who was not impleaded in this case. However, the Court of Appeals
instead directed that Calatagan to issue to Clemente a new certificate of stock. That sufficiently redresses the actual damages sustained by Clemente. After
all, the certificate of stock is simply the evidence of the share.
The Court of Appeals also awarded Clemente P200,000.00 as moral damages, P100,000.00 as exemplary damages, and P100,000.00 as attorneys fees.
We agree that the award of such damages is warranted.
The Court of Appeals cited Calatagan for violation of Article 32 of the Civil Code, which allows recovery of damages from any private individual who directly
or indirectly obstructs, defeats, violates or in any manner impedes or impairs the right against deprivation of property without due process of laws. The plain
letter of the provision squarely entitles Clemente to damages from Calatagan. Even without Article 32 itself, Calatagan will still be bound to pay moral and
exemplary damages to Clemente. The latter was able to duly prove that he had sustained mental anguish, serious anxiety and wounded feelings by reason
of Calatagans acts, thereby entitling him to moral damages under Article 2217 of the Civil Code. Moreover, it is evident that Calatagans bad faith as exhibited
in the
course of its corporate actions warrants correction for the public good, thereby justifying exemplary damages under Article 2229 of the Civil Code.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals is AFFIRMED. Costs against petitioner.
SO ORDERED.
ARDIENTE VS JAVIER 2013
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Decision1 and Resolution2 of
the Court of Appeals (CA), dated August 28, 2003 and December 17, 2003, respectively, in CA-G.R. CV No. 73000. The CA Decision affirmed with modification
123
the August 15, 2001 Decision3 of the Regional Trial Court (RTC) of Cagayan de Oro City, Branch 24, while the CA Resolution denied petitioner's Motion for
Reconsideration.
The facts, as summarized by the CA, are as follows:cralavvonlinelawlibrary
[Herein petitioner] Joyce V. Ardiente and her husband Dr. Roberto S. Ardiente are owners of a housing unit at Emily Homes, Balulang, Cagayan de Oro City
with a lot area of one hundred fifty-three (153) square meters and covered by Transfer Certificate of Title No. 69905.
On June 2, 1994, Joyce Ardiente entered into a Memorandum of Agreement (Exh. B, pp. 470-473, Records) selling, transferring and conveying in favor of
[respondent] Ma. Theresa Pastorfide all their rights and interests in the housing unit at Emily Homes in consideration of P70,000.00. The Memorandum of
Agreement carries a stipulation:cralavvonlinelawlibrary
4. That the water and power bill of the subject property shall be for the account of the Second Party (Ma. Theresa Pastorfide) effective June 1, 1994.
(Records, p. 47)
vis-a-vis Ma. Theresa Pastorfide's assumption of the payment of the mortgage loan secured by Joyce Ardiente from the National Home Mortgage (Records,
Exh. A, pp. 468-469)
For four (4) years, Ma. Theresa's use of the water connection in the name of Joyce Ardiente was never questioned nor perturbed (T.S.N., October 31, 2000,
pp. 7-8) until on March 12, 1999, without notice, the water connection of Ma. Theresa was cut off. Proceeding to the office of the Cagayan de Oro Water
District (COWD) to complain, a certain Mrs. Madjos told Ma. Theresa that she was delinquent for three (3) months corresponding to the months of December
1998, January 1999, and February 1999. Ma. Theresa argued that the due date of her payment was March 18, 1999 yet (T.S.N., October 31, 2000, pp. 11-
12). Mrs. Madjos later told her that it was at the instance of Joyce Ardiente that the water line was cut off (T.S.N., February 5, 2001, p. 31).
On March 15, 1999, Ma. Theresa paid the delinquent bills (T.S.N., October 31, 2000, p. 12). On the same date, through her lawyer, Ma. Theresa wrote a
letter to the COWD to explain who authorized the cutting of the water line (Records, p. 160).
On March 18, 1999, COWD, through the general manager, [respondent] Gaspar Gonzalez, Jr., answered the letter dated March 15, 1999 and reiterated that
it was at the instance of Joyce Ardiente that the water line was cut off (Records, p. 161).
Aggrieved, on April 14, 1999, Ma. Theresa Pastorfide [and her husband] filed [a] complaint for damages [against petitioner, COWD and its manager Gaspar
Gonzalez] (Records, pp. 2-6).
In the meantime, Ma. Theresa Pastorfide's water line was only restored and reconnected when the [trial] court issued a writ of preliminary mandatory injunction
on December 14, 1999 (Records, p. 237).4
After trial, the RTC rendered judgment holding as follows:cralavvonlinelawlibrary
124
xxxx
In the exercise of their rights and performance of their duties, defendants did not act with justice, gave plaintiffs their due and observe honesty and good faith.
Before disconnecting the water supply, defendants COWD and Engr. Gaspar Gonzales did not even send a disconnection notice to plaintiffs as testified to by
Engr. Bienvenido Batar, in-charge of the Commercial Department of defendant COWD. There was one though, but only three (3) days after the actual
disconnection on March 12, 1999. The due date for payment was yet on March 15. Clearly, they did not act with justice. Neither did they observe honesty.
They should not have been swayed by the prodding of Joyce V. Ardiente. They should have investigated first as to the present ownership of the house. For
doing the act because Ardiente told them, they were negligent. Defendant Joyce Ardiente should have requested before the cutting off of the water supply,
plaintiffs to pay. While she attempted to tell plaintiffs but she did not have the patience of seeing them. She knew that it was plaintiffs who had been using the
water four (4) years ago and not hers. She should have been very careful. x x x5
The dispositive portion of the trial court's Decision reads, thus:cralavvonlinelawlibrary
WHEREFORE, premises considered, judgment is hereby rendered ordering defendants [Ardiente, COWD and Gonzalez] to pay jointly and severally plaintiffs,
the following sums:cralavvonlinelawlibrary
(a) P200,000.00 for moral damages;chanroblesvirtualawlibrary

(b) 200,000.00 for exemplary damages; and
(c) 50,000.00 for attorney's fee.
The cross-claim of Cagayan de Oro Water District and Engr. Gaspar Gonzales is hereby dismissed. The Court is not swayed that the cutting off of the water
supply of plaintiffs was because they were influenced by defendant Joyce Ardiente. They were negligent too for which they should be liable.
SO ORDERED.6
Petitioner, COWD and Gonzalez filed an appeal with the CA.
On August 28, 2003, the CA promulgated its assailed Decision disposing as follows:cralavvonlinelawlibrary
IN VIEW OF ALL THE FOREGOING, the appealed decision is AFFIRMED, with the modification that the awarded damages is reduced to P100,000.00 each
for moral and exemplary damages, while attorney's fees is lowered to P25,000.00. Costs against appellants.
SO ORDERED.7
The CA ruled, with respect to petitioner, that she has a legal duty to honor the possession and use of water line by Ma. Theresa Pastorfide pursuant to their
Memorandum of Agreement and that when [petitioner] applied for its disconnection, she acted in bad faith causing prejudice and [injury to] Ma. Theresa
Pastorfide.8
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As to COWD and Gonzalez, the CA held that they failed to give a notice of disconnection and derelicted in reconnecting the water line despite payment of
the unpaid bills by the [respondent spouses Pastorfide].9
Petitioner, COWD and Gonzalez filed their respective Motions for Reconsideration, but these were denied by the CA in its Resolution dated December 17,
2003.
COWD and Gonzalez filed a petition for review on certiorari with this Court, which was docketed as G.R. No. 161802. However, based on technical grounds
and on the finding that the CA did not commit any reversible error in its assailed Decision, the petition was denied via a Resolution10 issued by this Court on
March 24, 2004. COWD and Gonzalez filed a motion for reconsideration, but the same was denied with finality through this Court's Resolution11 dated June
28, 2004.
Petitioner, on the other hand, timely filed the instant petition with the following Assignment of Errors:cralavvonlinelawlibrary
7.1 HONORABLE COURT OF APPEALS (ALTHOUGH IT HAS REDUCED THE LIABILITY INTO HALF) HAS STILL COMMITTED GRAVE AND SERIOUS
ERROR WHEN IT UPHELD THE JOINT AND SOLIDARY LIABILITY OF PETITIONER JOYCE V. ARDIENTE WITH CAGAYAN DE ORO WATER DISTRICT
(COWD) AND ENGR. GASPAR D. GONZALES FOR THE LATTER'S FAILURE TO SERVE NOTICE UPON RESPONDENTS SPOUSES PASTORFIDE
PRIOR TO THE ACTUAL DISCONNECTION DESPITE EVIDENCE ADDUCED DURING TRIAL THAT EVEN WITHOUT PETITIONER'S REQUEST, COWD
WAS ALREADY SET TO EFFECT DISCONNECTION OF RESPONDENTS' WATER SUPPLY DUE TO NON-PAYMENT OF ACCOUNT FOR THREE (3)
MONTHS.
7.2 THE HONORABLE COURT OF APPEALS COMMITTED GRAVE AND SERIOUS ERROR WHEN IT RULED TOTALLY AGAINST PETITIONER AND
FAILED TO FIND THAT RESPONDENTS ARE GUILTY OF CONTRIBUTORY NEGLIGENCE WHEN THEY FAILED TO PAY THEIR WATER BILLS FOR
THREE MONTHS AND TO MOVE FOR THE TRANSFER OF THE COWD ACCOUNT IN THEIR NAME, WHICH WAS A VIOLATION OF THEIR
MEMORANDUM OF AGREEMENT WITH PETITIONER JOYCE V. ARDIENTE. RESPONDENTS LIKEWISE DELIBERATELY FAILED TO EXERCISE
DILIGENCE OF A GOOD FATHER OF THE FAMILY TO MINIMIZE THE DAMAGE UNDER ART. 2203 OF THE NEW CIVIL CODE.
7.3 THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED WHEN IT DISREGARDED THE FACT THAT RESPONDENT SPOUSES PASTORFIDE
ARE LIKEWISE BOUND TO OBSERVE ARTICLE 19 OF THE NEW CIVIL CODE, i.e., IN THE EXERCISE OF THEIR RIGHTS AND IN THE PERFORMANCE
OF THEIR DUTIES TO ACT WITH JUSTICE, GIVE EVERYONE HIS DUE AND OBSERVE HONESTY AND GOOD FAITH.
7.4 THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT GRANTED AN AWARD OF MORAL AND EXEMPLARY DAMAGES AND
ATTORNEY'S FEES AS AGAINST PETITIONER ARDIENTE.12
At the outset, the Court noticed that COWD and Gonzalez, who were petitioner's co-defendants before the RTC and her co-appellants in the CA, were
impleaded as respondents in the instant petition. This cannot be done. Being her co-parties before the RTC and the CA, petitioner cannot, in the instant
petition for review on certiorari, make COWD and Gonzalez, adversary parties. It is a grave mistake on the part of petitioner's counsel to treat COWD and
Gonzalez as respondents. There is no basis to do so, considering that, in the first place, there is no showing that petitioner filed a cross-claim against COWD
126
and Gonzalez. Under Section 2, Rule 9 of the Rules of Court, a cross-claim which is not set up shall be barred. Thus, for failing to set up a cross-claim against
COWD and Gonzalez before the RTC, petitioner is already barred from doing so in the present petition.
More importantly, as shown above, COWD and Gonzalez's petition for review on certiorari filed with this Court was already denied with finality on June 28,
2004, making the presently assailed CA Decision final and executory insofar as COWD and Gonzalez are concerned. Thus, COWD and Gonzalez are already
precluded from participating in the present petition. They cannot resurrect their lost cause by filing pleadings this time as respondents but, nonetheless,
reiterating the same prayer in their previous pleadings filed with the RTC and the CA.
As to the merits of the instant petition, the Court likewise noticed that the main issues raised by petitioner are factual and it is settled that the resolution of
factual issues is the function of lower courts, whose findings on these matters are received with respect and considered binding by the Supreme Court subject
only to certain exceptions, none of which is present in this instant petition.13 This is especially true when the findings of the RTC have been affirmed by the
CA as in this case.14
In any case, a perusal of the records at hand would readily show that the instant petition lacks merit.
Petitioner insists that she should not be held liable for the disconnection of respondent spouses' water supply, because she had no participation in the actual
disconnection. However, she admitted in the present petition that it was she who requested COWD to disconnect the Spouses Pastorfide's water supply. This
was confirmed by COWD and Gonzalez in their cross-claim against petitioner. While it was COWD which actually discontinued respondent spouses' water
supply, it cannot be denied that it was through the instance of petitioner that the Spouses Pastorfide's water supply was disconnected in the first place.
It is true that it is within petitioner's right to ask and even require the Spouses Pastorfide to cause the transfer of the former's account with COWD to the latter's
name pursuant to their Memorandum of Agreement. However, the remedy to enforce such right is not to cause the disconnection of the respondent spouses'
water supply. The exercise of a right must be in accordance with the purpose for which it was established and must not be excessive or unduly harsh; there
must be no intention to harm another.15 Otherwise, liability for damages to the injured party will attach.16 In the present case, intention to harm was evident
on the part of petitioner when she requested for the disconnection of respondent spouses water supply without warning or informing the latter of such request.
Petitioner claims that her request for disconnection was based on the advise of COWD personnel and that her intention was just to compel the Spouses
Pastorfide to comply with their agreement that petitioner's account with COWD be transferred in respondent spouses' name. If such was petitioner's only
intention, then she should have advised respondent spouses before or immediately after submitting her request for disconnection, telling them that her request
was simply to force them to comply with their obligation under their Memorandum of Agreement. But she did not. What made matters worse is the fact that
COWD undertook the disconnection also without prior notice and even failed to reconnect the Spouses Pastorfides water supply despite payment of their
arrears. There was clearly an abuse of right on the part of petitioner, COWD and Gonzalez. They are guilty of bad faith.
The principle of abuse of rights as enshrined in Article 19 of the Civil Code provides that every person must, in the exercise of his rights and in the performance
of his duties, act with justice, give everyone his due, and observe honesty and good faith.
In this regard, the Court's ruling in Yuchengco v. The Manila Chronicle Publishing Corporation17 is instructive, to wit:cralavvonlinelawlibrary
xxxx
127
This provision of law sets standards which must be observed in the exercise of ones rights as well as in the performance of its duties, to wit: to act with justice;
give everyone his due; and observe honesty and good faith.
In Globe Mackay Cable and Radio Corporation v. Court of Appeals, it was elucidated that while Article 19 lays down a rule of conduct for the government of
human relations and for the maintenance of social order, it does not provide a remedy for its violation. Generally, an action for damages under either Article
20 or Article 21 would be proper. The Court said:cralavvonlinelawlibrary
One of the more notable innovations of the New Civil Code is the codification of "some basic principles that are to be observed for the rightful relationship
between human beings and for the stability of the social order." [REPORT ON THE CODE COMMISSION ON THE PROPOSED CIVIL CODE OF THE
PHILIPPINES, p. 39]. The framers of the Code, seeking to remedy the defect of the old Code which merely stated the effects of the law, but failed to draw out
its spirit, incorporated certain fundamental precepts which were "designed to indicate certain norms that spring from the fountain of good conscience" and
which were also meant to serve as "guides for human conduct [that] should run as golden threads through society, to the end that law may approach its
supreme ideal, which is the sway and dominance of justice." (Id.) Foremost among these principles is that pronounced in Article 19 x x x
xxxx
This article, known to contain what is commonly referred to as the principle of abuse of rights, sets certain standards which must be observed not only in the
exercise of one's rights, but also in the performance of one's duties. These standards are the following: to act with justice; to give everyone his due; and to
observe honesty and good faith. The law, therefore, recognizes a primordial limitation on all rights; that in their exercise, the norms of human conduct set forth
in Article 19 must be observed. A right, though by itself legal because recognized or granted by law as such, may nevertheless become the source of some
illegality. When a right is exercised in a manner which does not conform with the norms enshrined in Article 19 and results in damage to another, a legal
wrong is thereby committed for which the wrongdoer must be held responsible. But while Article 19 lays down a rule of conduct for the government of human
relations and for the maintenance of social order, it does not provide a remedy for its violation. Generally, an action for damages under either Article 20 or
Article 21 would be proper.
Corollarilly, Article 20 provides that every person who, contrary to law, willfully or negligently causes damage to another shall indemnify the latter for the
same. It speaks of the general sanctions of all other provisions of law which do not especially provide for its own sanction. When a right is exercised in a
manner which does not conform to the standards set forth in the said provision and results in damage to another, a legal wrong is thereby committed for which
the wrongdoer must be responsible. Thus, if the provision does not provide a remedy for its violation, an action for damages under either Article 20 or Article
21 of the Civil Code would be proper.
The question of whether or not the principle of abuse of rights has been violated resulting in damages under Article 20 or other applicable provision of law,
depends on the circumstances of each case. x x x18
To recapitulate, petitioner's acts which violated the abovementioned provisions of law is her unjustifiable act of having the respondent spouses' water supply
disconnected, coupled with her failure to warn or at least notify respondent spouses of such intention. On the part of COWD and Gonzalez, it is their failure
to give prior notice of the impending disconnection and their subsequent neglect to reconnect respondent spouses' water supply despite the latter's settlement
of their delinquent account.
On the basis of the foregoing, the Court finds no cogent reason to depart from the ruling of both the RTC and the CA that petitioner, COWD and Gonzalez
are solidarily liable.
128
The Spouses Pastorfide are entitled to moral damages based on the provisions of Article 2219,19 in connection with Articles 2020 and 2121 of the Civil Code.
As for exemplary damages, Article 2229 provides that exemplary damages may be imposed by way of example or correction for the public good. Nonetheless,
exemplary damages are imposed not to enrich one party or impoverish another, but to serve as a deterrent against or as a negative incentive to curb socially
deleterious actions.22 In the instant case, the Court agrees with the CA in sustaining the award of exemplary damages, although it reduced the amount
granted, considering that respondent spouses were deprived of their water supply for more than nine (9) months, and such deprivation would have continued
were it not for the relief granted by the RTC.
With respect to the award of attorney's fees, Article 2208 of the Civil Code provides, among others, that such fees may be recovered when exemplary damages
are awarded, when the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest, and
where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiffs plainly valid, just and demandable claim.
WHEREFORE, instant petition for review on certiorari is DENIED. The Decision and Resolution of the Court of Appeals, dated August 28, 2003 and December
17, 2003, respectively, in CA-G.R. CV No. 73000 are AFFIRMED.
SO ORDERED.
SESBRENO VS CA 1993
On 9 February 1981, petitioner Raul Sesbreo made a money market placement in the amount of P300,000.00 with the Philippine Underwriters Finance
Corporation ("Philfinance"), Cebu Branch; the placement, with a term of thirty-two (32) days, would mature on 13 March 1981, Philfinance, also on 9 February
1981, issued the following documents to petitioner:
(a) the Certificate of Confirmation of Sale, "without recourse," No. 20496 of one (1) Delta Motors Corporation Promissory Note ("DMC PN") No. 2731 for a
term of 32 days at 17.0% per annum;
(b) the Certificate of securities Delivery Receipt No. 16587 indicating the sale of DMC PN No. 2731 to petitioner, with the notation that the said security
was in custodianship of Pilipinas Bank, as per Denominated Custodian Receipt ("DCR") No. 10805 dated 9 February 1981; and
(c) post-dated checks payable on 13 March 1981 (i.e., the maturity date of petitioner's investment), with petitioner as payee, Philfinance as drawer, and
Insular Bank of Asia and America as drawee, in the total amount of P304,533.33.
On 13 March 1981, petitioner sought to encash the postdated checks issued by Philfinance. However, the checks were dishonored for having been drawn
against insufficient funds.
On 26 March 1981, Philfinance delivered to petitioner the DCR No. 10805 issued by private respondent Pilipinas Bank ("Pilipinas"). It reads as follows:
PILIPINAS BANK
Makati Stock Exchange Bldg.,
129
Ayala Avenue, Makati,

Metro Manila
February 9, 1981
VALUE DATE
TO Raul Sesbreo
April 6, 1981
MATURITY DATE
NO. 10805
DENOMINATED CUSTODIAN RECEIPT
This confirms that as a duly Custodian Bank, and upon instruction of PHILIPPINE UNDERWRITES FINANCE CORPORATION, we have in our custody the
following securities to you [sic] the extent herein indicated.
SERIAL MAT. FACE ISSUED REGISTERED AMOUNT
NUMBER DATE VALUE BY HOLDER PAYEE
2731 4-6-81 2,300,833.34 DMC PHIL. 307,933.33
UNDERWRITERS
FINANCE CORP.
We further certify that these securities may be inspected by you or your duly authorized representative at any time during regular banking hours.
Upon your written instructions we shall undertake physical delivery of the above securities fully assigned to you should this Denominated Custodianship
Receipt remain outstanding in your favor thirty (30) days after its maturity.
PILIPINAS BANK
(By Elizabeth De Villa
Illegible Signature) 1
On 2 April 1981, petitioner approached Ms. Elizabeth de Villa of private respondent Pilipinas, Makati Branch, and handed her a demand letter informing the
bank that his placement with Philfinance in the amount reflected in the DCR No. 10805 had remained unpaid and outstanding, and that he in effect was asking
for the physical delivery of the underlying promissory note. Petitioner then examined the original of the DMC PN No. 2731 and found: that the security had
been issued on 10 April 1980; that it would mature on 6 April 1981; that it had a face value of P2,300,833.33, with the Philfinance as "payee" and private
respondent Delta Motors Corporation ("Delta") as "maker;" and that on face of the promissory note was stamped "NON NEGOTIABLE." Pilipinas did not
deliver the Note, nor any certificate of participation in respect thereof, to petitioner.
Petitioner later made similar demand letters, dated 3 July 1981 and 3 August 1981, 2 again asking private respondent Pilipinas for physical delivery of the
original of DMC PN No. 2731. Pilipinas allegedly referred all of petitioner's demand letters to Philfinance for written instructions, as has been supposedly
agreed upon in "Securities Custodianship Agreement" between Pilipinas and Philfinance. Philfinance did not provide the appropriate instructions; Pilipinas
never released DMC PN No. 2731, nor any other instrument in respect thereof, to petitioner.
Petitioner also made a written demand on 14 July 1981 3 upon private respondent Delta for the partial satisfaction of DMC PN No. 2731, explaining that
Philfinance, as payee thereof, had assigned to him said Note to the extent of P307,933.33. Delta, however, denied any liability to petitioner on the promissory
130
note, and explained in turn that it had previously agreed with Philfinance to offset its DMC PN No. 2731 (along with DMC PN No. 2730) against Philfinance
PN No. 143-A issued in favor of Delta.
In the meantime, Philfinance, on 18 June 1981, was placed under the joint management of the Securities and exchange commission ("SEC") and the Central
Bank. Pilipinas delivered to the SEC DMC PN No. 2731, which to date apparently remains in the custody of the SEC. 4
As petitioner had failed to collect his investment and interest thereon, he filed on 28 September 1982 an action for damages with the Regional Trial Court
("RTC") of Cebu City, Branch 21, against private respondents Delta and Pilipinas. 5 The trial court, in a decision dated 5 August 1987, dismissed the complaint
and counterclaims for lack of merit and for lack of cause of action, with costs against petitioner.
Petitioner appealed to respondent Court of Appeals in C.A.-G.R. CV No. 15195. In a Decision dated 21 March 1989, the Court of Appeals denied the appeal
and held: 6
Be that as it may, from the evidence on record, if there is anyone that appears liable for the travails of plaintiff-appellant, it is Philfinance. As correctly observed
by the trial court:
This act of Philfinance in accepting the investment of plaintiff and charging it against DMC PN No. 2731 when its entire face value was already obligated or
earmarked for set-off or compensation is difficult to comprehend and may have been motivated with bad faith. Philfinance, therefore, is solely and legally
obligated to return the investment of plaintiff, together with its earnings, and to answer all the damages plaintiff has suffered incident thereto. Unfortunately
for plaintiff, Philfinance was not impleaded as one of the defendants in this case at bar; hence, this Court is without jurisdiction to pronounce judgement
against it. (p. 11, Decision)
WHEREFORE, finding no reversible error in the decision appealed from, the same is hereby affirmed in toto. Cost against plaintiff-appellant.
Petitioner moved for reconsideration of the above Decision, without success.
Hence, this Petition for Review on Certiorari.
After consideration of the allegations contained and issues raised in the pleadings, the Court resolved to give due course to the petition and required the
parties to file their respective memoranda. 7
Petitioner reiterates the assignment of errors he directed at the trial court decision, and contends that respondent court of Appeals gravely erred: (i) in
concluding that he cannot recover from private respondent Delta his assigned portion of DMC PN No. 2731; (ii) in failing to hold private respondent Pilipinas
solidarily liable on the DMC PN No. 2731 in view of the provisions stipulated in DCR No. 10805 issued in favor r of petitioner, and (iii) in refusing to pierce the
veil of corporate entity between Philfinance, and private respondents Delta and Pilipinas, considering that the three (3) entities belong to the "Silverio Group
of Companies" under the leadership of Mr. Ricardo Silverio, Sr. 8
131
There are at least two (2) sets of relationships which we need to address: firstly, the relationship of petitioner vis-a-vis Delta; secondly, the relationship of
petitioner in respect of Pilipinas. Actually, of course, there is a third relationship that is of critical importance: the relationship of petitioner and Philfinance.
However, since Philfinance has not been impleaded in this case, neither the trial court nor the Court of Appeals acquired jurisdiction over the person of
Philfinance. It is, consequently, not necessary for present purposes to deal with this third relationship, except to the extent it necessarily impinges upon or
intersects the first and second relationships.
I.
We consider first the relationship between petitioner and Delta.
The Court of appeals in effect held that petitioner acquired no rights vis-a-vis Delta in respect of the Delta promissory note (DMC PN No. 2731) which
Philfinance sold "without recourse" to petitioner, to the extent of P304,533.33. The Court of Appeals said on this point:
Nor could plaintiff-appellant have acquired any right over DMC PN No. 2731 as the same is "non-negotiable" as stamped on its face (Exhibit "6"), negotiation
being defined as the transfer of an instrument from one person to another so as to constitute the transferee the holder of the instrument (Sec. 30, Negotiable
Instruments Law). A person not a holder cannot sue on the instrument in his own name and cannot demand or receive payment (Section 51, id.) 9
Petitioner admits that DMC PN No. 2731 was non-negotiable but contends that the Note had been validly transferred, in part to him by assignment and that
as a result of such transfer, Delta as debtor-maker of the Note, was obligated to pay petitioner the portion of that Note assigned to him by the payee Philfinance.
Delta, however, disputes petitioner's contention and argues:
(1) that DMC PN No. 2731 was not intended to be negotiated or otherwise transferred by Philfinance as manifested by the word "non-negotiable" stamp
across the face of the Note 10 and because maker Delta and payee Philfinance intended that this Note would be offset against the outstanding obligation of
Philfinance represented by Philfinance PN No. 143-A issued to Delta as payee;
(2) that the assignment of DMC PN No. 2731 by Philfinance was without Delta's consent, if not against its instructions; and
(3) assuming (arguendo only) that the partial assignment in favor of petitioner was valid, petitioner took the Note subject to the defenses available to Delta,
in particular, the offsetting of DMC PN No. 2731 against Philfinance PN No. 143-A. 11
We consider Delta's arguments seriatim.
Firstly, it is important to bear in mind that the negotiation of a negotiable instrument must be distinguished from the assignment or transfer of an instrument
whether that be negotiable or non-negotiable. Only an instrument qualifying as a negotiable instrument under the relevant statute may be negotiated either
by indorsement thereof coupled with delivery, or by delivery alone where the negotiable instrument is in bearer form. A negotiable instrument may, however,
instead of being negotiated, also be assigned or transferred. The legal consequences of negotiation as distinguished from assignment of a negotiable
instrument are, of course, different. A non-negotiable instrument may, obviously, not be negotiated; but it may be assigned or transferred, absent an express
prohibition against assignment or transfer written in the face of the instrument:
132
The words "not negotiable," stamped on the face of the bill of lading, did not destroy its assignability, but the sole effect was to exempt the bill from the
statutory provisions relative thereto, and a bill, though not negotiable, may be transferred by assignment; the assignee taking subject to the equities between
the original parties. 12 (Emphasis added)
DMC PN No. 2731, while marked "non-negotiable," was not at the same time stamped "non-transferable" or "non-assignable." It contained no stipulation
which prohibited Philfinance from assigning or transferring, in whole or in part, that Note.
Delta adduced the "Letter of Agreement" which it had entered into with Philfinance and which should be quoted in full:
April 10, 1980

Philippine Underwriters Finance Corp.
Benavidez St., Makati,
Metro Manila.
Attention: Mr. Alfredo O. Banaria
SVP-Treasurer
GENTLEMEN:
This refers to our outstanding placement of P4,601,666.67 as evidenced by your Promissory Note No. 143-A, dated April 10, 1980, to mature on April 6, 1981.
As agreed upon, we enclose our non-negotiable Promissory Note No. 2730 and 2731 for P2,000,000.00 each, dated April 10, 1980, to be offsetted [sic]
against your PN No. 143-A upon co-terminal maturity.
Please deliver the proceeds of our PNs to our representative, Mr. Eric Castillo.
Very Truly Yours,
(Sgd.)
Florencio B. Biagan
Senior Vice President 13
We find nothing in his "Letter of Agreement" which can be reasonably construed as a prohibition upon Philfinance assigning or transferring all or part of DMC
PN No. 2731, before the maturity thereof. It is scarcely necessary to add that, even had this "Letter of Agreement" set forth an explicit prohibition of transfer
upon Philfinance, such a prohibition cannot be invoked against an assignee or transferee of the Note who parted with valuable consideration in good faith and
without notice of such prohibition. It is not disputed that petitioner was such an assignee or transferee. Our conclusion on this point is reinforced by the fact
that what Philfinance and Delta were doing by their exchange of their promissory notes was this: Delta invested, by making a money market placement with
Philfinance, approximately P4,600,000.00 on 10 April 1980; but promptly, on the same day, borrowed back the bulk of that placement, i.e., P4,000,000.00, by
issuing its two (2) promissory notes: DMC PN No. 2730 and DMC PN No. 2731, both also dated 10 April 1980. Thus, Philfinance was left with not
P4,600,000.00 but only P600,000.00 in cash and the two (2) Delta promissory notes.
Apropos Delta's complaint that the partial assignment by Philfinance of DMC PN No. 2731 had been effected without the consent of Delta, we note that such
consent was not necessary for the validity and enforceability of the assignment in favor of petitioner. 14 Delta's argument that Philfinance's sale or assignment
of part of its rights to DMC PN No. 2731 constituted conventional subrogation, which required its (Delta's) consent, is quite mistaken. Conventional subrogation,
133
which in the first place is never lightly inferred, 15 must be clearly established by the unequivocal terms of the substituting obligation or by the evident
incompatibility of the new and old obligations on every point. 16 Nothing of the sort is present in the instant case.
It is in fact difficult to be impressed with Delta's complaint, since it released its DMC PN No. 2731 to Philfinance, an entity engaged in the business of buying
and selling debt instruments and other securities, and more generally, in money market transactions. In Perez v. Court of Appeals, 17 the Court, speaking
through Mme. Justice Herrera, made the following important statement:
There is another aspect to this case. What is involved here is a money market transaction. As defined by Lawrence Smith "the money market is a market
dealing in standardized short-term credit instruments (involving large amounts) where lenders and borrowers do not deal directly with each other but through
a middle manor a dealer in the open market." It involves "commercial papers" which are instruments "evidencing indebtness of any person or entity. . ., which
are issued, endorsed, sold or transferred or in any manner conveyed to another person or entity, with or without recourse". The fundamental function of the
money market device in its operation is to match and bring together in a most impersonal manner both the "fund users" and the "fund suppliers." The money
market is an "impersonal market", free from personal considerations. "The market mechanism is intended to provide quick mobility of money and securities."
The impersonal character of the money market device overlooks the individuals or entities concerned. The issuer of a commercial paper in the money market
necessarily knows in advance that it would be expenditiously transacted and transferred to any investor/lender without need of notice to said issuer. In practice,
no notification is given to the borrower or issuer of commercial paper of the sale or transfer to the investor.
xxx xxx xxx

There is need to individuate a money market transaction, a relatively novel institution in the Philippine commercial scene. It has been intended to facilitate the
flow and acquisition of capital on an impersonal basis. And as specifically required by Presidential Decree No. 678, the investing public must be given adequate
and effective protection in availing of the credit of a borrower in the commercial paper market. 18 (Citations omitted; emphasis supplied)
We turn to Delta's arguments concerning alleged compensation or offsetting between DMC PN No. 2731 and Philfinance PN No. 143-A. It is important to note
that at the time Philfinance sold part of its rights under DMC PN No. 2731 to petitioner on 9 February 1981, no compensation had as yet taken place and
indeed none could have taken place. The essential requirements of compensation are listed in the Civil Code as follows:
Art. 1279. In order that compensation may be proper, it is necessary:
(1) That each one of the obligors be bound principally, and that he be at the same time a principal creditor of the other;
(2) That both debts consists in a sum of money, or if the things due are consumable, they be of the same kind, and also of the same quality if the latter
has been stated;
(3) That the two debts are due;
(4) That they be liquidated and demandable;
(5) That over neither of them there be any retention or controversy, commenced by third persons and communicated in due time to the debtor.
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On 9 February 1981, neither DMC PN No. 2731 nor Philfinance PN No. 143-A was due. This was explicitly recognized by Delta in its 10 April 1980 "Letter of
Agreement" with Philfinance, where Delta acknowledged that the relevant promissory notes were "to be offsetted (sic) against [Philfinance] PN No. 143-A
upon co-terminal maturity
As noted, the assignment to petitioner was made on 9 February 1981 or from forty-nine (49) days befoe the "co-terminal maturity" date, that is to say, before
any compensation had taken place. Further, the assignment to petitioner would have prevented compensation had taken place between Philfinance and
Delta, to the extent of P304,533.33, because upon execution of the assignment in favor of petitioner, Philfinance and Delta would have ceased to be creditors
and debtors of each other in their own right to the extent of the amount assigned by Philfinance to petitioner. Thus, we conclude that the assignment effected
by Philfinance in favor of petitioner was a valid one and that petitioner accordingly became owner of DMC PN No. 2731 to the extent of the portion thereof
assigned to him.
The record shows, however, that petitioner notified Delta of the fact of the assignment to him only on 14 July 1981, 19 that is, after the maturity not only of the
money market placement made by petitioner but also of both DMC PN No. 2731 and Philfinance PN No. 143-A. In other words, petitioner notified Delta of his
rights as assignee after compensation had taken place by operation of law because the offsetting instruments had both reached maturity. It is a firmly settled
doctrine that the rights of an assignee are not any greater that the rights of the assignor, since the assignee is merely substituted in the place of the assignor
20 and that the assignee acquires his rights subject to the equities i.e., the defenses which the debtor could have set up against the original assignor
before notice of the assignment was given to the debtor. Article 1285 of the Civil Code provides that:
Art. 1285. The debtor who has consented to the assignment of rights made by a creditor in favor of a third person, cannot set up against the assignee the
compensation which would pertain to him against the assignor, unless the assignor was notified by the debtor at the time he gave his consent, that he reserved
his right to the compensation.
If the creditor communicated the cession to him but the debtor did not consent thereto, the latter may set up the compensation of debts previous to the cession,
but not of subsequent ones.
If the assignment is made without the knowledge of the debtor, he may set up the compensation of all credits prior to the same and also later ones until he
had knowledge of the assignment. (Emphasis supplied)
Article 1626 of the same code states that: "the debtor who, before having knowledge of the assignment, pays his creditor shall be released from the obligation."
In Sison v. Yap-Tico, 21 the Court explained that:
[n]o man is bound to remain a debtor; he may pay to him with whom he contacted to pay; and if he pay before notice that his debt has been assigned, the law
holds him exonerated, for the reason that it is the duty of the person who has acquired a title by transfer to demand payment of the debt, to give his debt or
notice. 22
At the time that Delta was first put to notice of the assignment in petitioner's favor on 14 July 1981, DMC PN No. 2731 had already been discharged by
compensation. Since the assignor Philfinance could not have then compelled payment anew by Delta of DMC PN No. 2731, petitioner, as assignee of
Philfinance, is similarly disabled from collecting from Delta the portion of the Note assigned to him.
135
It bears some emphasis that petitioner could have notified Delta of the assignment or sale was effected on 9 February 1981. He could have notified Delta as
soon as his money market placement matured on 13 March 1981 without payment thereof being made by Philfinance; at that time, compensation had yet to
set in and discharge DMC PN No. 2731. Again petitioner could have notified Delta on 26 March 1981 when petitioner received from Philfinance the
Denominated Custodianship Receipt ("DCR") No. 10805 issued by private respondent Pilipinas in favor of petitioner. Petitioner could, in fine, have notified
Delta at any time before the maturity date of DMC PN No. 2731. Because petitioner failed to do so, and because the record is bare of any indication that
Philfinance had itself notified Delta of the assignment to petitioner, the Court is compelled to uphold the defense of compensation raised by private respondent
Delta. Of course, Philfinance remains liable to petitioner under the terms of the assignment made by Philfinance to petitioner.
II.
We turn now to the relationship between petitioner and private respondent Pilipinas. Petitioner contends that Pilipinas became solidarily liable with Philfinance
and Delta when Pilipinas issued DCR No. 10805 with the following words:
Upon your written instruction, we [Pilipinas] shall undertake physical delivery of the above securities fully assigned to you . 23
The Court is not persuaded. We find nothing in the DCR that establishes an obligation on the part of Pilipinas to pay petitioner the amount of P307,933.33
nor any assumption of liability in solidum with Philfinance and Delta under DMC PN No. 2731. We read the DCR as a confirmation on the part of Pilipinas
that:
(1) it has in its custody, as duly constituted custodian bank, DMC PN No. 2731 of a certain face value, to mature on 6 April 1981 and payable to the order
of Philfinance;
(2) Pilipinas was, from and after said date of the assignment by Philfinance to petitioner (9 February 1981), holding that Note on behalf and for the benefit
of petitioner, at least to the extent it had been assigned to petitioner by payee Philfinance; 24
(3) petitioner may inspect the Note either "personally or by authorized representative", at any time during regular bank hours; and
(4) upon written instructions of petitioner, Pilipinas would physically deliver the DMC PN No. 2731 (or a participation therein to the extent of P307,933.33)
"should this Denominated Custodianship receipt remain outstanding in [petitioner's] favor thirty (30) days after its maturity."
Thus, we find nothing written in printers ink on the DCR which could reasonably be read as converting Pilipinas into an obligor under the terms of DMC PN
No. 2731 assigned to petitioner, either upon maturity thereof or any other time. We note that both in his complaint and in his testimony before the trial court,
petitioner referred merely to the obligation of private respondent Pilipinas to effect the physical delivery to him of DMC PN No. 2731. 25 Accordingly, petitioner's
theory that Pilipinas had assumed a solidary obligation to pay the amount represented by a portion of the Note assigned to him by Philfinance, appears to be
a new theory constructed only after the trial court had ruled against him. The solidary liability that petitioner seeks to impute Pilipinas cannot, however, be
lightly inferred. Under article 1207 of the Civil Code, "there is a solidary liability only when the law or the nature of the obligation requires solidarity," The record
here exhibits no express assumption of solidary liability vis-a-vis petitioner, on the part of Pilipinas. Petitioner has not pointed to us to any law which imposed
such liability upon Pilipinas nor has petitioner argued that the very nature of the custodianship assumed by private respondent Pilipinas necessarily implies
solidary liability under the securities, custody of which was taken by Pilipinas. Accordingly, we are unable to hold Pilipinas solidarily liable with Philfinance and
private respondent Delta under DMC PN No. 2731.
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We do not, however, mean to suggest that Pilipinas has no responsibility and liability in respect of petitioner under the terms of the DCR. To the contrary, we
find, after prolonged analysis and deliberation, that private respondent Pilipinas had breached its undertaking under the DCR to petitioner Sesbreo.
We believe and so hold that a contract of deposit was constituted by the act of Philfinance in designating Pilipinas as custodian or depositary bank. The
depositor was initially Philfinance; the obligation of the depository was owed, however, to petitioner Sesbreo as beneficiary of the custodianship or depository
agreement. We do not consider that this is a simple case of a stipulation pour autri. The custodianship or depositary agreement was established as an integral
part of the money market transaction entered into by petitioner with Philfinance. Petitioner bought a portion of DMC PN No. 2731; Philfinance as assignor-
vendor deposited that Note with Pilipinas in order that the thing sold would be placed outside the control of the vendor. Indeed, the constituting of the depositary
or custodianship agreement was equivalent to constructive delivery of the Note (to the extent it had been sold or assigned to petitioner) to petitioner. It will be
seen that custodianship agreements are designed to facilitate transactions in the money market by providing a basis for confidence on the part of the investors
or placers that the instruments bought by them are effectively taken out of the pocket, as it were, of the vendors and placed safely beyond their reach, that
those instruments will be there available to the placers of funds should they have need of them. The depositary in a contract of deposit is obliged to return the
security or the thing deposited upon demand of the depositor (or, in the presented case, of the beneficiary) of the contract, even though a term for such return
may have been established in the said contract. 26 Accordingly, any stipulation in the contract of deposit or custodianship that runs counter to the fundamental
purpose of that agreement or which was not brought to the notice of and accepted by the placer-beneficiary, cannot be enforced as against such beneficiary-
placer.
We believe that the position taken above is supported by considerations of public policy. If there is any party that needs the equalizing protection of the law
in money market transactions, it is the members of the general public whom place their savings in such market for the purpose of generating interest revenues.
27 The custodian bank, if it is not related either in terms of equity ownership or management control to the borrower of the funds, or the commercial paper
dealer, is normally a preferred or traditional banker of such borrower or dealer (here, Philfinance). The custodian bank would have every incentive to protect
the interest of its client the borrower or dealer as against the placer of funds. The providers of such funds must be safeguarded from the impact of stipulations
privately made between the borrowers or dealers and the custodian banks, and disclosed to fund-providers only after trouble has erupted.
In the case at bar, the custodian-depositary bank Pilipinas refused to deliver the security deposited with it when petitioner first demanded physical delivery
thereof on 2 April 1981. We must again note, in this connection, that on 2 April 1981, DMC PN No. 2731 had not yet matured and therefore, compensation or
offsetting against Philfinance PN No. 143-A had not yet taken place. Instead of complying with the demand of the petitioner, Pilipinas purported to require and
await the instructions of Philfinance, in obvious contravention of its undertaking under the DCR to effect physical delivery of the Note upon receipt of "written
instructions" from petitioner Sesbreo. The ostensible term written into the DCR (i.e., "should this [DCR] remain outstanding in your favor thirty [30] days after
its maturity") was not a defense against petitioner's demand for physical surrender of the Note on at least three grounds: firstly, such term was never brought
to the attention of petitioner Sesbreo at the time the money market placement with Philfinance was made; secondly, such term runs counter to the very
purpose of the custodianship or depositary agreement as an integral part of a money market transaction; and thirdly, it is inconsistent with the provisions of
Article 1988 of the Civil Code noted above. Indeed, in principle, petitioner became entitled to demand physical delivery of the Note held by Pilipinas as soon
as petitioner's money market placement matured on 13 March 1981 without payment from Philfinance.
We conclude, therefore, that private respondent Pilipinas must respond to petitioner for damages sustained by arising out of its breach of duty. By failing to
deliver the Note to the petitioner as depositor-beneficiary of the thing deposited, Pilipinas effectively and unlawfully deprived petitioner of the Note deposited
137
with it. Whether or not Pilipinas itself benefitted from such conversion or unlawful deprivation inflicted upon petitioner, is of no moment for present purposes.
Prima facie, the damages suffered by petitioner consisted of P304,533.33, the portion of the DMC PN No. 2731 assigned to petitioner but lost by him by
reason of discharge of the Note by compensation, plus legal interest of six percent (6%) per annum containing from 14 March 1981.
The conclusion we have reached is, of course, without prejudice to such right of reimbursement as Pilipinas may have vis-a-vis Philfinance.
III.
The third principal contention of petitioner that Philfinance and private respondents Delta and Pilipinas should be treated as one corporate entity need
not detain us for long.
In the first place, as already noted, jurisdiction over the person of Philfinance was never acquired either by the trial court nor by the respondent Court of
Appeals. Petitioner similarly did not seek to implead Philfinance in the Petition before us.
Secondly, it is not disputed that Philfinance and private respondents Delta and Pilipinas have been organized as separate corporate entities. Petitioner asks
us to pierce their separate corporate entities, but has been able only to cite the presence of a common Director Mr. Ricardo Silverio, Sr., sitting on the
Board of Directors of all three (3) companies. Petitioner has neither alleged nor proved that one or another of the three (3) concededly related companies
used the other two (2) as mere alter egos or that the corporate affairs of the other two (2) were administered and managed for the benefit of one. There is
simply not enough evidence of record to justify disregarding the separate corporate personalities of delta and Pilipinas and to hold them liable for any assumed
or undetermined liability of Philfinance to petitioner. 28
WHEREFORE, for all the foregoing, the Decision and Resolution of the Court of Appeals in C.A.-G.R. CV No. 15195 dated 21 march 1989 and 17 July 1989,
respectively, are hereby MODIFIED and SET ASIDE, to the extent that such Decision and Resolution had dismissed petitioner's complaint against Pilipinas
Bank. Private respondent Pilipinas bank is hereby ORDERED to indemnify petitioner for damages in the amount of P304,533.33, plus legal interest thereon
at the rate of six percent (6%) per annum counted from 2 April 1981. As so modified, the Decision and Resolution of the Court of Appeals are hereby
AFFIRMED. No pronouncement as to costs.
SO ORDERED.
SALADAGA VS ASTORGA 2014
Membership in the legal profession is a high personal privilege burdened with conditions,1 including continuing fidelity to the law and constant possession of
moral fitness. Lawyers, as guardians of the law, play a vital role in the preservation of society, and a consequent obligation of lawyers is to maintain the
highest standards of ethical conduct.2 Failure to live by the standards of the legal profession and to discharge the burden of the privilege conferred on one as
a member of the bar warrant the suspension or revocation of that privilege.
The Factual Antecedents
138
Complainant Florencio A. Saladaga and respondent Atty. Arturo B. Astorga entered into a "Deed of Sale with Right to Repurchase" on December 2, 1981
where respondent sold (with rightof repurchase) to complainant a parcel of coconut land located at Barangay Bunga, Baybay, Leyte covered by Transfer
Certificate of Title (TCT) No. T-662 for P15,000.00. Under the said deed, respondent represented that he has "the perfect right to dispose as owner in fee
simple" the subject property and that the said property is "free from all liens and encumbrances."3 The deed also provided that respondent, as vendor a retro,
had two years within which to repurchase the property, and if not repurchased within the said period, "the parties shall renew [the] instrument/agreement."4
Respondent failed to exercise his right of repurchase within the period provided in the deed, and no renewal of the contract was made even after complainant
sent respondent a final demand dated May 10, 1984 for the latter to repurchase the property. Complainant remained in peaceful possession of the property
until December 1989 when he received letters from the Rural Bank of Albuera (Leyte), Inc. (RBAI) informing him that the property was mortgaged by
respondent to RBAI, that the bank had subsequently foreclosed on the property, and that complainant should therefore vacate the property.5
Complainant was alarmed and made aninvestigation. He learned the following:
(1) TCT No. T-662 was already cancelled by TCT No. T-3211 in the name of Philippine National Bank (PNB) as early as November 17, 1972 after foreclosure
proceedings;
(2) TCT No. T-3211 was cancelled by TCT No. T-7235 in the names of respondent and his wife on January 4, 1982 pursuant to a deed of sale dated March
27,1979 between PNB and respondent;
(3) Respondent mortgaged the subject property to RBAI on March 14, 1984, RBAI foreclosed on the property, and subsequently obtained TCT No. TP-10635
on March 27, 1991.6 Complainant was subsequently dispossessed of the property by RBAI.7
Aggrieved, complainant instituted a criminal complaint for estafa against respondent with the Office of the Provincial Prosecutor of Leyte, docketed as I.S. No.
95-144. The Provincial Prosecutor of Leyte approved the Resolution8 dated April 21, 1995 in I.S. No. 95-144 finding that "[t]he facts of [the] case are sufficient
to engender a well-founded belief that Estafa x x x has been committed and that respondent herein is probably guilty thereof."9 Accordingly, an Information10
dated January 8,1996 was filed before the Municipal Trial Court (MTC) of Baybay, Leyte, formally charging respondent with the crime of estafa under Article
316, paragraphs 1 and 2 of the Revised Penal Code,11 committed as follows:
On March 14, 1984, accused representing himself as the owner of a parcel of land known as Lot No. 7661 of the Baybay Cadastre, mortgaged the same to
the Rural Bank of Albuera, Albuera, Leyte, within the jurisdiction of this Honorable Court, knowing fully well that the possessor and owner at that time was
private complainant Florencio Saladaga by virtue of a Pacto de Retro Sale which accused executed in favor of private complainant on 2nd December, 1981,
without first redeeming/repurchasing the same. [P]rivate complainant knowing of accused[s] unlawful act only on or about the last week of February, 1991
when the rural bank dispossessed him of the property, the mortgage having been foreclosed, private complainant thereby suffered damages and was
prejudiced by accused[s] unlawful transaction and misrepresentation.
The aforementioned estafa case against respondent was docketed as Criminal Case No. 3112-A.
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Complainant likewise instituted the instant administrative cases against respondent by filing before this Court an Affidavit-Complaint12 dated January 28,
1997 and Supplemental Complaint13 dated February 27, 1997, which were docketed as A.C. No. 4697 and A.C. No. 4728, respectively. In both complaints,
complainant sought the disbarment of respondent.
The administrative cases were referred to the Integrated Bar of the Philippines (IBP) for investigation, report and recommendation.14
In his Consolidated Answer15 dated August 16, 2003 filed before the IBP, respondent denied that his agreement with complainant was a pacto de retrosale.
He claimed that it was an equitable mortgage and that, if only complainant rendered an accounting of his benefits from the produce of the land, the total
amount would have exceeded P15,000.00.
Report and Recommendation of the Investigating Commissioner and Resolution of the IBP Board of Governors
In a Report and Recommendation16 dated April 29, 2005, the Investigating Commissioner of the IBPs Commission on Bar Discipline found that respondent
was in bad faith when he dealt with complainant and executed the "Deed of Sale with Right to Repurchase" but later on claimed that the agreement was one
of equitable mortgage. Respondent was also guilty of deceit or fraud when he represented in the "Deed of Sale with Right to Repurchase" dated December
2, 1981 that the property was covered by TCT No. T-662, even giving complainant the owners copy of the said certificate of title, when the said TCT had
already been cancelled on November 17, 1972 by TCT No. T-3211 in the name of Philippine National Bank (PNB). Respondent made matters even worse,
when he had TCT No. T-3211 cancelled with the issuance of TCT No. T-7235 under his and his wifes name on January 4,1982 without informing complainant.
This was compounded by respondents subsequent mortgage of the property to RBAI, which led to the acquisition of the property by RBAI and the
dispossession thereof of complainant. Thus, the Investigating Commissioner recommended that respondent be (1) suspended from the practice of law for
one year, with warning that a similar misdeed in the future shall be dealt with more severity, and (2) ordered to return the sum of P15,000.00, the amount he
received as consideration for the pacto de retrosale, with interest at the legal rate.
Considering respondents "commission of unlawful acts, especially crimes involving moral turpitude, actsof dishonesty, grossly immoral conduct and deceit,"
the IBP Board of Governors adopted and approved the Investigating Commissioners Report and Recommendation with modification as follows: respondent
is(1) suspended from the practice of law for two years, with warning that a similar misdeed in the future shall be dealt with more severity, and (2) ordered to
return the sum of P15,000.00 received in consideration of the pacto de retrosale, with legal interest.17
The Courts Ruling
The Court agrees with the recommendation of the IBP Board of Governors to suspend respondent from the practice of law for two years, but it refrains from
ordering respondent to return the P15,000.00 consideration, plus interest.
Respondent does not deny executing the "Deed of Sale with Right to Repurchase" dated December 2, 1981 in favor of complainant. However, respondent
insists that the deed is not one of sale with pacto de retro, but one of equitable mortgage. Thus, respondent argues that he still had the legal right to mortgage
the subject property to other persons. Respondent additionally asserts that complainant should render an accounting of the produce the latter had collected
from the said property, which would already exceed the P15,000.00 consideration stated in the deed.
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There is no merit in respondents defense.
Regardless of whether the written contract between respondent and complainant is actually one of sale with pacto de retroor of equitable mortgage,
respondents actuations in his transaction with complainant, as well as in the present administrative cases, clearly show a disregard for the highest standards
of legal proficiency, morality, honesty, integrity, and fair dealing required from lawyers, for which respondent should be held administratively liable.
When respondent was admitted to the legal profession, he took an oath where he undertook to "obey the laws," "do no falsehood," and "conduct [him]self as
a lawyer according to the best of [his] knowledge and discretion."18 He gravely violated his oath.
The Investigating Commissioner correctly found, and the IBP Board of Governors rightly agreed, that respondent caused the ambiguity or vagueness in the
"Deed of Sale with Right to Repurchase" as he was the one who prepared or drafted the said instrument. Respondent could have simply denominated the
instrument as a deed of mortgage and referred to himself and complainant as "mortgagor" and "mortgagee," respectively, rather than as "vendor a retro" and
"vendee a retro." If only respondent had been more circumspect and careful in the drafting and preparation of the deed, then the controversy between him
and complainant could havebeen avoided or, at the very least, easily resolved. His imprecise and misleading wording of the said deed on its face betrayed
lack oflegal competence on his part. He thereby fell short of his oath to "conduct [him]self as a lawyer according to the best of [his] knowledge and discretion."
More significantly, respondent transgressed the laws and the fundamental tenet of human relations asembodied in Article 19 of the Civil Code:
Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and
good faith.
Respondent, as owner of the property, had the right to mortgage it to complainant but, as a lawyer, he should have seen to it that his agreement with
complainant is embodied in an instrument that clearly expresses the intent of the contracting parties. A lawyer who drafts a contract must see to it that the
agreement faithfully and clearly reflects the intention of the contracting parties. Otherwise, the respective rights and obligations of the contracting parties will
be uncertain, which opens the door to legal disputes between the said parties. Indeed, the uncertainty caused by respondents poor formulation of the "Deed
of Sale with Right to Repurchase" was a significant factor in the legal controversy between respondent and complainant. Such poor formulation reflects at the
very least negatively on the legal competence of respondent.
Under Section 63 of the Land Registration Act,19 the law in effect at the time the PNB acquired the subject property and obtained TCT No. T-3211 in its name
in 1972, where a decree in favor of a purchaser who acquires mortgaged property in foreclosure proceedings becomes final, such purchaser becomes entitled
to the issuance of a new certificate of title in his name and a memorandum thereof shall be "indorsed upon the mortgagors original certificate."20 TCT No. T-
662, which respondent gave complainant when they entered into the "Deed of Sale with Right to Repurchase" dated December 2, 1981, does not bearsuch
memorandum but only a memorandum on the mortgage of the property to PNB in 1963 and the subsequent amendment of the mortgage.
Respondent dealt with complainant with bad faith, falsehood, and deceit when he entered into the "Deed of Sale with Right to Repurchase" dated December
2, 1981 with the latter. He made it appear that the property was covered by TCT No. T-662 under his name, even giving complainant the owners copy of the
said certificate oftitle, when the truth is that the said TCT had already been cancelled some nine years earlier by TCT No. T-3211 in the name of PNB. He did
141
not evencare to correct the wrong statement in the deed when he was subsequently issued a new copy of TCT No. T-7235 on January 4, 1982,21 or barely
a month after the execution of the said deed. All told, respondent clearly committed an act of gross dishonesty and deceit against complainant.
Canon 1 and Rule 1.01 of the Codeof Professional Responsibility provide:
CANON 1 A lawyer shall uphold the constitution, obey the laws of the land and promote respect for law and legal processes.
Rule 1.01 A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct. Under Canon 1, a lawyer is not only mandated to personally obey
the laws and the legal processes, he is moreover expected to inspire respect and obedience thereto. On the other hand, Rule 1.01 states the norm of conduct
that is expected of all lawyers.22
Any act or omission that is contrary to, prohibited or unauthorized by, in defiance of, disobedient to, or disregards the law is "unlawful." "Unlawful" conduct
does not necessarily imply the element of criminality although the concept is broad enough to include such element.23
To be "dishonest" means the disposition to lie, cheat, deceive, defraud or betray; be untrustworthy; lacking inintegrity, honesty, probity, integrity in principle,
fairness and straightforwardness. On the other hand, conduct that is "deceitful" means as follows:
[Having] the proclivity for fraudulent and deceptive misrepresentation, artifice or device that is used upon another who is ignorant of the true facts, to the
prejudice and damage of the party imposed upon. In order to be deceitful, the person must either have knowledge of the falsity or acted in reckless and
conscious ignorance thereof, especially if the parties are not on equal terms, and was done with the intent that the aggrieved party act thereon, and the latter
indeed acted in reliance of the false statement or deed in the manner contemplated to his injury.24 The actions of respondent in connection with the execution
of the "Deed of Sale with Right to Repurchase" clearly fall within the concept of unlawful, dishonest, and deceitful conduct. They violate Article 19 of the Civil
Code. They show a disregard for Section 63 of the Land Registration Act. They also reflect bad faith, dishonesty, and deceit on respondents part. Thus,
respondent deserves to be sanctioned.
Respondents breach of his oath, violation of the laws, lack of good faith, and dishonesty are compounded by his gross disregard of this Courts directives, as
well as the orders of the IBPs Investigating Commissioner (who was acting as an agent of this Court pursuant to the Courts referral of these cases to the IBP
for investigation, report and recommendation), which caused delay in the resolution of these administrative cases.
In particular, the Court required respondent to comment on complainants Affidavit-Complaint in A.C. No. 4697 and Supplemental Complaint in A.C. No. 4728
on March 12, 1997 and June 25, 1997, respectively.25 While he requested for several extensions of time within which to submit his comment, no such
comment was submitted prompting the Court to require him in a Resolution dated February 4,1998 to (1) show cause why he should not be disciplinarily dealt
with or held in contempt for such failure, and (2) submit the consolidated comment.26 Respondent neither showed cause why he should not be disciplinarily
dealt with or held in contempt for such failure, nor submitted the consolidated comment.
When these cases were referred to the IBP and during the proceedings before the IBPs Investigating Commissioner, respondent was again required several
times to submit his consolidated answer. He only complied on August 28, 2003, or more than six years after this Court originally required him to do so. The
142
Investigating Commissioner also directed the parties to submit their respective position papers. Despite having been given several opportunities to submit the
same, respondent did not file any position paper.27
Respondents disregard of the directives of this Court and of the Investigating Commissioner, which caused undue delay in these administrative cases,
contravenes the following provisions of the Code of Professional Responsibility:
CANON 11 A lawyer shall observe and maintain the respect due to the courts and to judicial officers and should insist on similar conduct by others.
xxx
CANON 12 A lawyer shall exert every effort and consider it his duty to assist in the speedy and efficient administration of justice.
xxxx
Rule 12.03 A lawyer shall not, after obtaining extensions of time to file pleadings, memoranda or briefs, let the period lapse without submitting the same or
offering an explanation for his failure to do so.
Rule 12.04 A lawyer shall not unduly delay a case, impede the execution of a judgment or misuse court processes.
Respondents infractions are aggravated by the fact that he has already been imposed a disciplinary sanction before.1wphi1 In Nuez v. Atty. Astorga,28
respondent was held liable for conduct unbecoming an attorney for which he was fined P2,000.00.
Given the foregoing, the suspension of respondent from the practice of law for two years, as recommended by the IBP Board of Governors, is proper.
The Court, however, will not adopt the recommendation of the IBP to order respondent to return the sum of P15,000.00 he received from complainant under
the "Deed of Sale with Right to Repurchase." This is a civil liability best determined and awarded in a civil case rather than the present administrative cases.
In Roa v. Moreno,29 the Court pronounced that "[i]n disciplinary proceedings against lawyers, the only issue is whether the officer of the court is still fit to be
allowed to continue as a member of the Bar. Our only concern is the determination of respondents administrative liability. Our findings have no material
bearing on other judicial action which the parties may choose to file against each other."While the respondent lawyers wrongful actuations may give rise at
the same time to criminal, civil, and administrative liabilities, each must be determined in the appropriate case; and every case must be resolved in accordance
with the facts and the law applicable and the quantum of proof required in each. Section 5,30 in relation to Sections 131 and 2,32 Rule 133 of the Rules of
Court states that in administrative cases, such as the ones atbar, only substantial evidence is required, not proof beyond reasonable doubt as in criminal
cases, or preponderance of evidence asin civil cases. Substantial evidence is that amount of relevant evidence which a reasonable mind might accept as
adequate to justify a conclusion.33
The Court notes that based on the same factual antecedents as the present administrative cases, complainant instituted a criminal case for estafa against
respondent, docketed as Criminal Case No. 3112-A, before the MTC. When a criminal action is instituted, the civil action for the recovery of civil liability arising
from the offense charged shall be deemed instituted with the criminal action unless the offended party waives the civil action, reserves the right to institute it
separately or institutes the civil action prior to the criminal action.34 Unless the complainant waived the civil action, reserved the right to institute it separately,
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or instituted the civil action prior to the criminal action, then his civil action for the recovery of civil liability arising from the estafa committed by respondent is
deemed instituted with Criminal Case No. 3112-A. The civil liability that complainant may recover in Criminal Case No. 3112-A includes restitution; reparation
of the damage caused him; and/or indemnification for consequential damages,35 which may already cover the P15,000.00 consideration complainant had
paid for the subject property.
WHEREFORE, respondent is hereby found GUILTY of the following: breach of the Lawyers Oath; unlawful, dishonest, and deceitful conduct; and disrespect
for the Court and causing undue delay of these cases, for which he is SUSPENDED from the practice of law for a period of two (2) years, reckoned from
receipt of this Decision, with WARNING that a similar misconduct in the future shall be dealt with more severely.
Let a copy of this Decision be furnished the Office of the Bar Confidant and the Integrated Bar of the Philippines for their information and guidance. The Court
Administrator is directed to circulate this Decision to all courts in the country.
SO ORDERED.
BUENAVENTURA VS CA 2005
These cases involve a petition for the declaration of nullity of marriage, which was filed by petitioner Noel Buenaventura on July 12, 1992, on the ground of
the alleged psychological incapacity of his wife, Isabel Singh Buenaventura, herein respondent. After respondent filed her answer, petitioner, with leave of
court, amended his petition by stating that both he and his wife were psychologically incapacitated to comply with the essential obligations of marriage. In
response, respondent filed an amended answer denying the allegation that she was psychologically incapacitated.[1]
On July 31, 1995, the Regional Trial Court promulgated a Decision, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered as follows:
1) Declaring and decreeing the marriage entered into between plaintiff Noel A. Buenaventura and defendant Isabel Lucia Singh Buenaventura on July 4,
1979, null and void ab initio;
2) Ordering the plaintiff to pay defendant moral damages in the amount of 2.5 million pesos and exemplary damages of 1 million pesos with 6% interest from
the date of this decision plus attorneys fees of P100,000.00;
3) Ordering the plaintiff to pay the defendant expenses of litigation of P50,000.00, plus costs;
4) Ordering the liquidation of the assets of the conjugal partnership property[,] particularly the plaintiffs separation/retirement benefits received from the Far
East Bank [and] Trust Company[,] by ceding, giving and paying to her fifty percent (50%) of the net amount of P3,675,335.79 or P1,837,667.89 together with
12% interest per annum from the date of this decision and one-half (1/2) of his outstanding shares of stock with Manila Memorial Park and Provident Group
of Companies;
5) Ordering him to give a regular support in favor of his son Javy Singh Buenaventura in the amount of P15,000.00 monthly, subject to modification as the
necessity arises;
6) Awarding the care and custody of the minor Javy Singh Buenaventura to his mother, the herein defendant; and
7) Hereby authorizing the defendant to revert back to the use of her maiden family name Singh.
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Let copies of this decision be furnished the appropriate civil registry and registries of properties.
SO ORDERED.[2]
Petitioner appealed the above decision to the Court of Appeals. While the case was pending in the appellate court, respondent filed a motion to increase the
P15,000 monthly support pendente lite of their son Javy Singh Buenaventura. Petitioner filed an opposition thereto, praying that it be denied or that such
incident be set for oral argument.[3]
On September 2, 1996, the Court of Appeals issued a Resolution increasing the support pendente lite to P20,000.[4] Petitioner filed a motion for
reconsideration questioning the said Resolution.[5]
On October 8, 1996, the appellate court promulgated a Decision dismissing petitioners appeal for lack of merit and affirming in toto the trial courts decision.[6]
Petitioner filed a motion for reconsideration which was denied. From the abovementioned Decision, petitioner filed the instant Petition for Review on Certiorari.
On November 13, 1996, through another Resolution, the Court of Appeals denied petitioners motion for reconsideration of the September 2, 1996 Resolution,
which increased the monthly support for the son.[7] Petitioner filed a Petition for Certiorari to question these two Resolutions.
On July 9, 1997, the Petition for Review on Certiorari[8] and the Petition for Certiorari[9] were ordered consolidated by this Court.[10]
In the Petition for Review on Certiorari petitioner claims that the Court of Appeals decided the case not in accord with law and jurisprudence, thus:
1. WHEN IT AWARDED DEFENDANT-APPELLEE MORAL DAMAGE IN THE AMOUNT OF P2.5 MILLION AND EXEMPLARY DAMAGES OF P1 MILLION,
WITH 6% INTEREST FROM THE DATE OF ITS DECISION, WITHOUT ANY LEGAL AND MORAL BASIS;
2. WHEN IT AWARDED P100,000.00 ATTORNEYS FEES AND P50,000.00 EXPENSES OF LITIGATION, PLUS COSTS, TO DEFENDANT-APPELLEE,
WITHOUT FACTUAL AND LEGAL BASIS;
3. WHEN IT ORDERED PLAINTIFF-APPELLANT NOEL TO PAY DEFENDANT-APPELLEE ONE-HALF OR P1,837,667.89 OUT OF HIS RETIREMENT
BENEFITS RECEIVED FROM THE FAR EAST BANK AND TRUST CO., WITH 12% INTEREST THEREON FROM THE DATE OF ITS DECISION,
NOTWITHSTANDING THAT SAID RETIREMENT BENEFITS ARE GRATUITOUS AND EXCLUSIVE PROPERTY OF NOEL, AND ALSO TO DELIVER TO
DEFENDANT-APPELLEE ONE-HALF OF HIS SHARES OF STOCK WITH THE MANILA MEMORIAL PARK AND THE PROVIDENT GROUP OF
COMPANIES, ALTHOUGH SAID SHARES OF STOCK WERE ACQUIRED BY NOEL BEFORE HIS MARRIAGE TO RESPONDENT ISABEL AND ARE,
THEREFORE, AGAIN HIS EXCLUSIVE PROPERTIES; AND
4. WHEN IT AWARDED EXCLUSIVE CARE AND CUSTODY OVER THE PARTIES MINOR CHILD TO DEFENDANT-APPELLEE WITHOUT ASKING THE
CHILD (WHO WAS ALREADY 13 YEARS OLD AT THAT TIME) HIS CHOICE AS TO WHOM, BETWEEN HIS TWO PARENTS, HE WOULD LIKE TO HAVE
CUSTODY OVER HIS PERSON.[11]
In the Petition for Certiorari, petitioner advances the following contentions:
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THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION WHEN IT REFUSED TO SET RESPONDENTS MOTION FOR INCREASED SUPPORT
FOR THE PARTIES SON FOR HEARING.[12]
THERE WAS NO NEED FOR THE COURT OF APPEALS TO INCREASE JAVYS MONTHLY SUPPORT OF P15,000.00 BEING GIVEN BY PETITIONER
EVEN AT PRESENT PRICES.[13]
IN RESOLVING RESPONDENTS MOTION FOR THE INCREASE OF JAVYS SUPPORT, THE COURT OF APPEALS SHOULD HAVE EXAMINED THE
LIST OF EXPENSES SUBMITTED BY RESPONDENT IN THE LIGHT OF PETITIONERS OBJECTIONS THERETO, INSTEAD OF MERELY ASSUMING
THAT JAVY IS ENTITLED TO A P5,000 INCREASE IN SUPPORT AS SAID AMOUNT IS TOO MINIMAL.[14]
LIKEWISE, THE COURT OF APPEALS SHOULD HAVE GIVEN PETITIONER AN OPPORTUNITY TO PROVE HIS PRESENT INCOME TO SHOW THAT
HE CANNOT AFFORD TO INCREASE JAVYS SUPPORT.[15]
With regard to the first issue in the main case, the Court of Appeals articulated:
On Assignment of Error C, the trial court, after findings of fact ascertained from the testimonies not only of the parties particularly the defendant-appellee but
likewise, those of the two psychologists, awarded damages on the basis of Articles 21, 2217 and 2229 of the Civil Code of the Philippines.
Thus, the lower court found that plaintiff-appellant deceived the defendant-appellee into marrying him by professing true love instead of revealing to her that
he was under heavy parental pressure to marry and that because of pride he married defendant-appellee; that he was not ready to enter into marriage as in
fact his career was and always would be his first priority; that he was unable to relate not only to defendant-appellee as a husband but also to his son, Javy,
as a father; that he had no inclination to make the marriage work such that in times of trouble, he chose the easiest way out, that of leaving defendantappellee
and their son; that he had no desire to keep defendant-appellee and their son as proved by his reluctance and later, refusal to reconcile after their separation;
that the aforementioned caused defendant-appellee to suffer mental anguish, anxiety, besmirched reputation, sleepless nights not only in those years the
parties were together but also after and throughout their separation.
Plaintiff-appellant assails the trial courts decision on the ground that unlike those arising from a breach in ordinary contracts, damages arising as a
consequence of marriage may not be awarded. While it is correct that there is, as yet, no decided case by the Supreme Court where damages by reason of
the performance or non-performance of marital obligations were awarded, it does not follow that no such award for damages may be made.
Defendant-appellee, in her amended answer, specifically prayed for moral and exemplary damages in the total amount of 7 million pesos. The lower court, in
the exercise of its discretion, found full justification of awarding at least half of what was originally prayed for. We find no reason to disturb the ruling of the
trial court.[16]
The award by the trial court of moral damages is based on Articles 2217 and 21 of the Civil Code, which read as follows:
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ART. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation, and similar injury. Though incapable of pecuniary computation, moral damages may be recovered if they are the proximate result of the defendants
wrongful act or omission.
ART. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the
latter for the damage.
The trial court referred to Article 21 because Article 2219[17] of the Civil Code enumerates the cases in which moral damages may be recovered and it
mentions Article 21 as one of the instances. It must be noted that Article 21 states that the individual must willfully cause loss or injury to another. There is a
need that the act is willful and hence done in complete freedom. In granting moral damages, therefore, the trial court and the Court of Appeals could not but
have assumed that the acts on which the moral damages were based were done willfully and freely, otherwise the grant of moral damages would have no leg
to stand on.
On the other hand, the trial court declared the marriage of the parties null and void based on Article 36 of the Family Code, due to psychological incapacity of
the petitioner, Noel Buenaventura. Article 36 of the Family Code states:
A marriage contracted by any party who, at the time of the celebration, was psychologically incapacitated to comply with the essential marital obligations of
marriage, shall likewise be void even if such incapacity becomes manifest only after its solemnization.
Psychological incapacity has been defined, thus:
. . . no less than a mental (not physical) incapacity that causes a party to be truly incognitive of the basic marital covenants that concomitantly must be
assumed and discharged by the parties to the marriage which, as so expressed by Article 68 of the Family Code, include their mutual obligations to live
together, observe love, respect and fidelity and render help and support. There is hardly any doubt that the intendment of the law has been to confine the
meaning of "psychological incapacity" to the most serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give
meaning and significance to the marriage. . . .[18]
The Court of Appeals and the trial court considered the acts of the petitioner after the marriage as proof of his psychological incapacity, and therefore a
product of his incapacity or inability to comply with the essential obligations of marriage. Nevertheless, said courts considered these acts as willful and hence
as grounds for granting moral damages. It is contradictory to characterize acts as a product of psychological incapacity, and hence beyond the control of the
party because of an innate inability, while at the same time considering the same set of acts as willful. By declaring the petitioner as psychologically
incapacitated, the possibility of awarding moral damages on the same set of facts was negated. The award of moral damages should be predicated, not on
the mere act of entering into the marriage, but on specific evidence that it was done deliberately and with malice by a party who had knowledge of his or her
disability and yet willfully concealed the same. No such evidence appears to have been adduced in this case.
For the same reason, since psychological incapacity means that one is truly incognitive of the basic marital covenants that one must assume and discharge
as a consequence of marriage, it removes the basis for the contention that the petitioner purposely deceived the private respondent. If the private respondent
was deceived, it was not due to a willful act on the part of the petitioner. Therefore, the award of moral damages was without basis in law and in fact.
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Since the grant of moral damages was not proper, it follows that the grant of exemplary damages cannot stand since the Civil Code provides that exemplary
damages are imposed in addition to moral, temperate, liquidated or compensatory damages.[19]
With respect to the grant of attorneys fees and expenses of litigation the trial court explained, thus:
Regarding Attorneys fees, Art. 2208 of the Civil Code authorizes an award of attorneys fees and expenses of litigation, other than judicial costs, when as in
this case the plaintiffs act or omission has compelled the defendant to litigate and to incur expenses of litigation to protect her interest (par. 2), and where the
Court deems it just and equitable that attorneys fees and expenses of litigation should be recovered. (par. 11)[20]
The Court of Appeals reasoned as follows:
On Assignment of Error D, as the award of moral and exemplary damages is fully justified, the award of attorneys fees and costs of litigation by the trial court
is likewise fully justified.[21]
The acts or omissions of petitioner which led the lower court to deduce his psychological incapacity, and his act in filing the complaint for the annulment of his
marriage cannot be considered as unduly compelling the private respondent to litigate, since both are grounded on petitioners psychological incapacity, which
as explained above is a mental incapacity causing an utter inability to comply with the obligations of marriage. Hence, neither can be a ground for attorneys
fees and litigation expenses. Furthermore, since the award of moral and exemplary damages is no longer justified, the award of attorneys fees and expenses
of litigation is left without basis.
Anent the retirement benefits received from the Far East Bank and Trust Co. and the shares of stock in the Manila Memorial Park and the Provident Group of
Companies, the trial court said:
The third issue that must be resolved by the Court is what to do with the assets of the conjugal partnership in the event of declaration of annulment of the
marriage. The Honorable Supreme Court has held that the declaration of nullity of marriage carries ipso facto a judgment for the liquidation of property
(Domingo v. Court of Appeals, et al., G.R. No. 104818, Sept. 17, 1993, 226 SCRA, pp. 572 573, 586). Thus, speaking through Justice Flerida Ruth P. Romero,
it was ruled in this case:
When a marriage is declared void ab initio, the law states that the final judgment therein shall provide for the liquidation, partition and distribution of the
properties of the spouses, the custody and support of the common children and the delivery of their presumptive legitimes, unless such matters had been
adjudicated in the previous proceedings.
The parties here were legally married on July 4, 1979, and therefore, all property acquired during the marriage, whether the acquisition appears to have been
made, contracted or registered in the name of one or both spouses, is presumed to be conjugal unless the contrary is proved (Art. 116, New Family Code;
Art. 160, Civil Code). Art. 117 of the Family Code enumerates what are conjugal partnership properties. Among others they are the following:
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1) Those acquired by onerous title during the marriage at the expense of the common fund, whether the acquisition be for the partnership, or for only one of
the spouses;
2) Those obtained from the labor, industry, work or profession of either or both of the spouses;
3) The fruits, natural, industrial, or civil, due or received during the marriage from the common property, as well as the net fruits from the exclusive property
of each spouse.
Applying the foregoing legal provisions, and without prejudice to requiring an inventory of what are the parties conjugal properties and what are the exclusive
properties of each spouse, it was disclosed during the proceedings in this case that the plaintiff who worked first as Branch Manager and later as Vice-
President of Far East Bank & Trust Co. received separation/retirement package from the said bank in the amount of P3,701,500.00 which after certain
deductions amounting to P26,164.21 gave him a net amount of P3,675,335.79 and actually paid to him on January 9, 1995 (Exhs. 6, 7, 8, 9, 10, 11). Not
having shown debts or obligations other than those deducted from the said retirement/separation pay, under Art. 129 of the Family Code The net remainder
of the conjugal partnership properties shall constitute the profits, which shall be divided equally between husband and wife, unless a different proportion or
division was agreed upon in the marriage settlement or unless there has been a voluntary waiver or forfeiture of such share as provided in this Code. In this
particular case, however, there had been no marriage settlement between the parties, nor had there been any voluntary waiver or valid forfeiture of the
defendant wifes share in the conjugal partnership properties. The previous cession and transfer by the plaintiff of his one-half (1/2) share in their residential
house and lot covered by T.C.T. No. S-35680 of the Registry of Deeds of Paraaque, Metro Manila, in favor of the defendant as stipulated in their Compromise
Agreement dated July 12, 1993, and approved by the Court in its Partial Decision dated August 6, 1993, was actually intended to be in full settlement of any
and all demands for past support. In reality, the defendant wife had allowed some concession in favor of the plaintiff husband, for were the law strictly to be
followed, in the process of liquidation of the conjugal assets, the conjugal dwelling and the lot on which it is situated shall, unless otherwise agreed upon by
the parties, be adjudicated to the spouse with whom their only child has chosen to remain (Art. 129, par. 9). Here, what was done was one-half (1/2) portion
of the house was ceded to defendant so that she will not claim anymore for past unpaid support, while the other half was transferred to their only child as his
presumptive legitime.
Consequently, nothing yet has been given to the defendant wife by way of her share in the conjugal properties, and it is but just, lawful and fair, that she be
given one-half (1/2) share of the separation/retirement benefits received by the plaintiff the same being part of their conjugal partnership properties having
been obtained or derived from the labor, industry, work or profession of said defendant husband in accordance with Art. 117, par. 2 of the Family Code. For
the same reason, she is entitled to one-half (1/2) of the outstanding shares of stock of the plaintiff husband with the Manila Memorial Park and the Provident
Group of Companies.[22]
The Court of Appeals articulated on this matter as follows:
On Assignment of Error E, plaintiff-appellant assails the order of the trial court for him to give one-half of his separation/retirement benefits from Far East Bank
& Trust Company and half of his outstanding shares in Manila Memorial Park and Provident Group of Companies to the defendant-appellee as the latters
share in the conjugal partnership.
On August 6, 1993, the trial court rendered a Partial Decision approving the Compromise Agreement entered into by the parties. In the same Compromise
Agreement, the parties had agreed that henceforth, their conjugal partnership is dissolved. Thereafter, no steps were taken for the liquidation of the conjugal
partnership.
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Finding that defendant-appellee is entitled to at least half of the separation/retirement benefits which plaintiff-appellant received from Far East Bank & Trust
Company upon his retirement as Vice-President of said company for the reason that the benefits accrued from plaintiffappellants service for the bank for a
number of years, most of which while he was married to defendant-appellee, the trial court adjudicated the same. The same is true with the outstanding shares
of plaintiff-appellant in Manila Memorial Park and Provident Group of Companies. As these were acquired by the plaintiff-appellant at the time he was married
to defendant-appellee, the latter is entitled to one-half thereof as her share in the conjugal partnership. We find no reason to disturb the ruling of the trial
court.[23]
Since the present case does not involve the annulment of a bigamous marriage, the provisions of Article 50 in relation to Articles 41, 42 and 43 of the Family
Code, providing for the dissolution of the absolute community or conjugal partnership of gains, as the case may be, do not apply. Rather, the general rule
applies, which is that in case a marriage is declared void ab initio, the property regime applicable and to be liquidated, partitioned and distributed is that of
equal co-ownership.
In Valdes v. Regional Trial Court, Branch 102, Quezon City,[24] this Court expounded on the consequences of a void marriage on the property relations of
the spouses and specified the applicable provisions of law:
The trial court correctly applied the law. In a void marriage, regardless of the cause thereof, the property relations of the parties during the period of cohabitation
is governed by the provisions of Article 147 or Article 148, such as the case may be, of the Family Code. Article 147 is a remake of Article 144 of the Civil
Code as interpreted and so applied in previous cases; it provides:
ART. 147. When a man and a woman who are capacitated to marry each other, live exclusively with each other as husband and wife without the benefit of
marriage or under a void marriage, their wages and salaries shall be owned by them in equal shares and the property acquired by both of them through their
work or industry shall be governed by the rules on co-ownership.
In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to have been obtained by their joint efforts, work or
industry, and shall be owned by them in equal shares. For purposes of this Article, a party who did not participate in the acquisition by the other party of any
property shall be deemed to have contributed jointly in the acquisition thereof if the former's efforts consisted in the care and maintenance of the family and
of the household.
Neither party can encumber or dispose by acts inter vivos of his or her share in the property acquired during cohabitation and owned in common, without the
consent of the other, until after the termination of their cohabitation.
When only one of the parties to a void marriage is in good faith, the share of the party in bad faith in the co-ownership shall be forfeited in favor of their
common children. In case of default of or waiver by any or all of the common children or their descendants, each vacant share shall belong to the respective
surviving descendants. In the absence of descendants, such share shall belong to the innocent party. In all cases, the forfeiture shall take place upon
termination of the cohabitation.
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This peculiar kind of co-ownership applies when a man and a woman, suffering no legal impediment to marry each other, so exclusively live together as
husband and wife under a void marriage or without the benefit of marriage. The term "capacitated" in the provision (in the first paragraph of the law) refers to
the legal capacity of a party to contract marriage, i.e., any "male or female of the age of eighteen years or upwards not under any of the impediments mentioned
in Articles 37 and 38" of the Code.
Under this property regime, property acquired by both spouses through their work and industry shall be governed by the rules on equal co-ownership. Any
property acquired during the union is prima facie presumed to have been obtained through their joint efforts. A party who did not participate in the acquisition
of the property shall still be considered as having contributed thereto jointly if said party's "efforts consisted in the care and maintenance of the family
household." Unlike the conjugal partnership of gains, the fruits of the couple's separate property are not included in the co-ownership.
Article 147 of the Family Code, in substance and to the above extent, has clarified Article 144 of the Civil Code; in addition, the law now expressly provides
that
(a) Neither party can dispose or encumber by act[s] inter vivos [of] his or her share in co-ownership property, without the consent of the other, during the
period of cohabitation; and
(b) In the case of a void marriage, any party in bad faith shall forfeit his or her share in the co-ownership in favor of their common children; in default thereof
or waiver by any or all of the common children, each vacant share shall belong to the respective surviving descendants, or still in default thereof, to the
innocent party. The forfeiture shall take place upon the termination of the cohabitation or declaration of nullity of the marriage.
In deciding to take further cognizance of the issue on the settlement of the parties' common property, the trial court acted neither imprudently nor precipitately;
a court which had jurisdiction to declare the marriage a nullity must be deemed likewise clothed with authority to resolve incidental and consequential matters.
Nor did it commit a reversible error in ruling that petitioner and private respondent own the "family home" and all their common property in equal shares, as
well as in concluding that, in the liquidation and partition of the property owned in common by them, the provisions on co-ownership under the Civil Code, not
Articles 50, 51 and 52, in relation to Articles 102 and 129, of the Family Code, should aptly prevail. The rules set up to govern the liquidation of either the
absolute community or the conjugal partnership of gains, the property regimes recognized for valid and voidable marriages (in the latter case until the contract
is annulled), are irrelevant to the liquidation of the co-ownership that exists between common-law spouses. The first paragraph of Article 50 of the Family
Code, applying paragraphs (2), (3), (4) and (5) of Article 43, relates only, by its explicit terms, to voidable marriages and, exceptionally, to void marriages
under Article 40 of the Code, i.e., the declaration of nullity of a subsequent marriage contracted by a spouse of a prior void marriage before the latter is
judicially declared void. The latter is a special rule that somehow recognizes the philosophy and an old doctrine that void marriages are inexistent from the
very beginning and no judicial decree is necessary to establish their nullity. In now requiring for purposes of remarriage, the declaration of nullity by final
judgment of the previously contracted void marriage, the present law aims to do away with any continuing uncertainty on the status of the second marriage.
It is not then illogical for the provisions of Article 43, in relation to Articles 41 and 42, of the Family Code, on the effects of the termination of a subsequent
marriage contracted during the subsistence of a previous marriage to be made applicable pro hac vice. In all other cases, it is not to be assumed that the law
has also meant to have coincident property relations, on the one hand, between spouses in valid and voidable marriages (before annulment) and, on the
other, between common-law spouses or spouses of void marriages, leaving to ordain, in the latter case, the ordinary rules on co-ownership subject to the
provision of Article 147 and Article 148 of the Family Code. It must be stressed, nevertheless, even as it may merely state the obvious, that the provisions of
151
the Family Code on the "family home," i.e., the provisions found in Title V, Chapter 2, of the Family Code, remain in force and effect regardless of the property
regime of the spouses.[25]
Since the properties ordered to be distributed by the court a quo were found, both by the trial court and the Court of Appeals, to have been acquired during
the union of the parties, the same would be covered by the co-ownership. No fruits of a separate property of one of the parties appear to have been included
or involved in said distribution. The liquidation, partition and distribution of the properties owned in common by the parties herein as ordered by the court a
quo should, therefore, be sustained, but on the basis of co-ownership and not of the regime of conjugal partnership of gains.
As to the issue on custody of the parties over their only child, Javy Singh Buenaventura, it is now moot since he is about to turn twenty-five years of age on
May 27, 2005[26] and has, therefore, attained the age of majority.
With regard to the issues on support raised in the Petition for Certiorari, these would also now be moot, owing to the fact that the son, Javy Singh Buenaventura,
as previously stated, has attained the age of majority.
WHEREFORE, the Decision of the Court of Appeals dated October 8, 1996 and its Resolution dated December 10, 1996 which are contested in the Petition
for Review (G.R. No. 127449), are hereby MODIFIED, in that the award of moral and exemplary damages, attorneys fees, expenses of litigation and costs
are deleted. The order giving respondent one-half of the retirement benefits of petitioner from Far East Bank and Trust Co. and one-half of petitioners shares
of stock in Manila Memorial Park and in the Provident Group of Companies is sustained but on the basis of the liquidation, partition and distribution of the co-
ownership and not of the regime of conjugal partnership of gains. The rest of said Decision and Resolution are AFFIRMED.
The Petition for Review on Certiorari (G.R. No. 127358) contesting the Court of Appeals Resolutions of September 2, 1996 and November 13, 1996 which
increased the support pendente lite in favor of the parties son, Javy Singh Buenaventura, is now MOOT and ACADEMIC and is, accordingly, DISMISSED.
No costs.
SO ORDERED.
FILINVEST VS NGILAY 2012
For this Court's consideration is the Petition for Review on Certiorari under Rule 45, dated November 9, 2006, of petitioner Filinvest Land, Inc., which seeks
to set aside the Decision1 dated March 30, 2006 and Resolution2 dated September 18, 2006 of the Court of Appeals (CA) partially reversing the Decision3
dated October 1, 2003 of the Regional Trial Court, Las Pias, Branch 253 (RTC).
The factual antecedents, as found in the records follow.
Respondents were grantees of agricultural public lands located in Tambler, General Santos City through Homestead and Fee patents sometime in 1986 and
1991 which are covered by and specifically described in the following Original Certificates of Title issued by the Register of Deeds of General Santos City:
152
OCT No. Area (sq. m.) Grantee Date Granted

P-5204 38,328 Abdul Backy Ngilay November 11, 1986
P-5205 49,996 Hadji Gulam Ngilay November 11, 1986
P-5206 49,875 Edris A. Ngilay November 11, 1986
P-5207 44,797 Robayca A. Ngilay November 11, 1986
P-5209 20,000 Omar Ngilay November 11, 1986
P-5211 29,990 Tayba Ngilay November 11, 1986
P-5212 48,055 Kiram Ngilay November 11, 1986
P-5578 20,408 Nadjer Esquevel November 24, 1991
P-5579 35,093 Unos Bantangan November 24, 1991
P-5580 39,507 Moner Ngilay November 24, 1991
P-5582 44,809 Baiya Ngilay November 24, 1991
P-5583 10,050 Jamela Ngilay November 24, 1991
P-5584 49,993 Ramir Ngilay November 24, 1991
P-5586 40,703 Satar Ngilay November 24, 1991
P-5590 20,000 Abehara Ngilay November 24, 1991
P-5592 41,645 Lucaya Ngilay November 24, 1991
P-5595 13,168 Edmer Andong November 24, 1991
Negotiations were made by petitioner, represented by Lina de Guzman-Ferrer with the patriarch of the Ngilays, Hadji Gulam Ngilay sometime in 1995.
Eventually, a Deed of Conditional Sale of the above- enumerated properties in favor of petitioner Filinvest Land, Inc. was executed. Upon its execution,
respondents were asked to deliver to petitioner the original owner's duplicate copy of the certificates of title of their respective properties. Respondents
received the downpayment for the properties on October 28, 1995.
A few days after the execution of the aforestated deeds and the delivery of the corresponding documents to petitioner, respondents came to know that the
sale of their properties was null and void, because it was done within the period that they were not allowed to do so and that the sale did not have the approval
of the Secretary of the Department of Environment and Natural Resources (DENR) prompting them to file a case for the declaration of nullity of the deeds of
conditional and absolute sale of the questioned properties and the grant of right of way with the RTC, Las Pias, Branch 253.
On the other hand, petitioner claims that sometime in 1995, the representative of Hadji Ngilay approached petitioner to propose the sale of a portion of his
properties. Thereafter, representatives of petitioner flew to General Santos City from Manila to conduct an ocular inspection of the subject properties. Petitioner
was willing to purchase the properties but seeing that some of the properties were registered as land grants through homestead patents, representatives of
petitioner informed Ngilay that they would return to General Santos City in a few months to finalize the sale as ten (10) certificates of title were issued on
November 24, 1991.
According to petitioner, Ngilay and his children prevailed upon the representatives of petitioner to make an advance payment. To accommodate the Ngilays,
petitioner acceded to making an advance with the understanding that petitioner could demand anytime the return of the advance payment should Ngilay not
be able to comply with the conditions of the sale. The Ngilays likewise undertook to secure the necessary approvals of the DENR before the consummation
of the sale.
153
The RTC ruled in favor of Filinvest Land, Inc. and upheld the sale of all the properties in litigation. It found that the sale of those properties whose original
certificates of title were issued by virtue of the 1986 Patents was valid, considering that the prohibitory period ended in 1991, or way before the transaction
took place. As to those patents awarded in 1991, the same court opined that since those properties were the subject of a deed of conditional sale, compliance
with those conditions is necessary for there to be a perfected contract between the parties. The RTC also upheld the grant of right of way as it adjudged that
the right of way agreement showed that the right of way was granted to provide access from the highway to the properties to be purchased. The dispositive
portion of the Decision dated October 1, 2003 reads:
WHEREFORE, premises considered, the Court upholds the sale of all the properties in litigation. It likewise upholds the grant of right of way in favor of the
respondent. Consequently, the petition is DISMISSED.
No pronouncement as to damages for failure to prove the same.
Costs against the petitioners.
SO ORDERED.4
Respondents elevated the case to the CA in which the latter modified the judgment of the RTC.1wphi1 While the CA upheld the validity of the sale of the
properties the patents of which were awarded in 1986, including the corresponding grant of right of way for the same lots, it nullified the disposition of those
properties granted through patents in 1991 and the right of way on the same properties. As to the "1991 Patents," the CA ruled that the contract of sale
between the parties was a perfected contract, hence, the parties entered into a prohibited conveyance of a homestead within the prohibitive period of five
years from the issuance of the patent. The CA Decision dated March 30, 2006 disposed the case as follows:
WHEREFORE, the assailed Decision dated October 1, 2003 is MODIFIED:
a) The Deed of Conditional Sale and Deed of Absolute Sale for the properties covered by the "1991 Patents", as well as the Right of Way Agreement thereto,
are declared null and void. The Register of Deeds of General Santos City is consequently directed to cancel the certificates of title covered by the "1991
Patents" issued in favor of appellee Filinvest and to issue new titles in favor of herein appellants.
b) The sale of the properties covered by the "1986 Patents", including the corresponding grant of way for said lots, are declared valid.
SO ORDERED.5
Petitioners filed a Motion for Partial Reconsideration, but it was denied by the CA.
Hence, the present petition.
The grounds relied upon are:
154
1. A CONDITIONAL SALE INVOLVING THE 1991 PATENTS DID NOT VIOLATE THE PROHIBITION AGAINST ALIENATION OF HOMESTEADS UNDER
THE PUBLIC LAND ACT SINCE NO ACTUAL TRANSFER OR DISPOSITION WAS PERFECTED UNTIL ALL THE CONDITIONS OF THE DEED ARE
FULFILLED.
2. REGISTRATION IS THE OPERATIVE ACT THAT CONVEYS OR DISPOSES RIGHTS IN REAL PROPERTY. BEING UNREGISTERED, THE DEED OF
CONDITIONAL SALE DID NOT CONVEY OR DISPOSE OF THE 1991 HOMESTEADS OR ANY RIGHTS THEREIN IN VIOLATION OF THE PUBLIC LAND
ACT.
3. ASSUMING THE NULLITY OF THE SALE OF THE 1991 PATENTS, THE HONORABLE COURT OF APPEALS SHOULD HAVE ORDERED
RESPONDENTS AS A MATTER OF LAW TO RETURN TO PETITIONERS WHAT THEY HAVE RECEIVED.6
In their Comment7 dated March 5, 2007, respondents stated the following counter-arguments:
(1) The Honorable Court of Appeals did not err in holding that the Deed of Conditional Sale and Deed of Absolute Sale for the properties covered by the 1991
Patents, as well as the Right of Way Agreement thereto is null and void for the simplest reason that the said transactions were volatile of the Public Land Act.
(2) The questions raised by the Petitioner, Filinvest Land Inc. (FLI) are unsubstantial to require consideration.8
In its Reply9 dated July 30, 2007, petitioner insists that the prohibition against alienation and disposition of land covered by Homestead Patents is a prohibition
against the actual loss of the homestead within the five-year prohibitory period, not against all contracts including those that do not result in such an actual
loss of ownership or possession. It also points out that respondents themselves admit that the transfer certificates of title covering the ten parcels of land are
all dated 1998, which confirms its declaration that the lands covered by 1991 Homestead Patents were not conveyed to Filinvest until after the five-year
prohibitory period.
The petition is unmeritorious.
The five-year prohibitory period following the issuance of the homestead patent is provided under Section 118 of Commonwealth Act No. 141, as amended
by Commonwealth Act No. 456, otherwise known as the Public Land Act.10 It bears stressing that the law was enacted to give the homesteader or patentee
every chance to preserve for himself and his family the land that the State had gratuitously given to him as a reward for his labour in cleaning and cultivating
it.11 Its basic objective, as the Court had occasion to stress, is to promote public policy that is to provide home and decent living for destitute, aimed at
providing a class of independent small landholders which is the bulwark of peace and order.12 Hence, any act which would have the effect of removing the
property subject of the patent from the hands of a grantee will be struck down for being violative of the law.13
In the present case, the negotiations for the purchase of the properties covered by the patents issued in 1991 were made in 1995 and, eventually, an undated
Deed of Conditional Sale was executed. On October 28, 1995, respondents received the downpayment of P14,000.000.00 for the properties covered by the
patents issued in 1991. Applying the five-year prohibition, the properties covered by the patent issued on November 24, 1991 could only be alienated after
November 24, 1996. Therefore, the sale, having been consummated on October 28, 1995, or within the five-year prohibition, is as ruled by the CA, void.
155
Petitioner argues that the correct formulation of the issue is not whether there was a perfected contract between the parties during the period of prohibition,
but whether by such deed of conditional sale there was "alienation or encumbrance" within the contemplation of the law. This is wrong. The prohibition does
not distinguish between consummated and executory sale. The conditional sale entered into by the parties is still a conveyance of the homestead patent. As
correctly ruled by the CA, citing Ortega v. Tan:14
And, even assuming that the disputed sale was not yet perfected or consummated, still, the transaction cannot be validated. The prohibition of the law on the
sale or encumbrance of the homestead within five years after the grant is MANDATORY. The purpose of the law is to promote a definite policy, i.e., "to
preserve and keep in the family of the homesteader that portion of the public land which the State has gratuitously given to him." Thus, the law does not
distinguish between executory and consummated sales. Where the sale of a homestead was perfected within the prohibitory period of five years, the fact that
the formal deed of sale was executed after the expiration of the staid period DID NOT and COULD NOT legalize a contract that was void from its inception.
To hold valid such arrangement would be to throw the door open to all possible fraudulent subterfuges and schemes which persons interested in the land
given to a homesteader may devise in circumventing and defeating the legal provisions prohibiting their alienation within five years from the issuance of the
patent.15
To repeat, the conveyance of a homestead before the expirtion of the five-year prohibitory period following the issuance of the homestead patent is null and
void and cannot be enforced, for it is not within the competence of any citizen to barter away what public policy by law seeks to preserve.16
Nevertheless, petitioner does not err in seeking the return of the down payment as a consequence of the sale having been declared void. The rule is settled
that the declaration of nullity of a contract which is void ab initio operates to restore things to the state and condition in which they were found before the
execution thereof.17 Petitioner is correct in its argument that allowing respondents to keep the amount received from petitioner is tantamount to judicial
acquiescence to unjust enrichment. Unjust enrichment exists "when a person unjustly retains a benefit to the loss of another, or when a person retains money
or property of another against the fundamental principles of justice, equity and good conscience."18 There is unjust enrichment under Article 22 of the Civil
Code when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of or with damages to another.19 Thus, the sale which created
the obligation of petitioner to pay the agreed amount having been declared void, respondents have the duty to return the down payment as they no longer
have the right to keep it. The principle of unjust enrichment essentially contemplates payment when there is no duty to pay, and the person who receives the
payment has no right to receive it.20 As found by the CA and undisputed by the parties, the amount or the down payment made is P14,000,000.00 which
shall also be the amount to be returned by respondents.
WHEREFORE, the Petition for Review on Certiorari dated November 9, 2006 or petitioner Filinvest Land, Inc. is hereby DENIED. Consequently, the Decision
dated March 30, 2006 and Resolution dated September 18, 2006 or the Court of Appeals are hereby AFFIRMED with the MODIFICATION that respondents
return the amount of P14,000,000.00 given by petitioner as down payment for the sale which is ruled to be void ab initio.
SO ORDERED.
GONZALO VS TARNATE 2014
The doctrine of in pari delicto which stipulates that the guilty parties to an illegal contract are not entitled to any relief, cannot prevent a recovery if doing so
violates the public policy against unjust enrichment.
156
Antecedents
After the Department of Public Works and Highways (DPWH) had awarded on July 22, 1997 the contract for the improvement of the Sadsadan-Maba-ay
Section of the Mountain Province-Benguet Road in the total amount of 7 014 963 33 to his company, Gonzalo Construction,1 petitioner Domingo Gonzalo
(Gonzalo) subcontracted to respondent John Tarnate, Jr. (Tarnate) on October 15, 1997, the supply of materials and labor for the project under the latter s
business known as JNT Aggregates. Their agreement stipulated, among others, that Tarnate would pay to Gonzalo eight percent and four percent of the
contract price, respectively, upon Tarnate s first and second billing in the project.2
In furtherance of their agreement, Gonzalo executed on April 6, 1999 a deed of assignment whereby he, as the contractor, was assigning to Tarnate an
amount equivalent to 10% of the total collection from the DPWH for the project. This 10% retention fee (equivalent to P233,526.13) was the rent for Tarnates
equipment that had been utilized in the project. In the deed of assignment, Gonzalo further authorized Tarnate to use the official receipt of Gonzalo
Construction in the processing of the documents relative to the collection of the 10% retention fee and in encashing the check to be issued by the DPWH for
that purpose.3 The deed of assignment was submitted to the DPWH on April 15, 1999. During the processing of the documents for the retention fee, however,
Tarnate learned that Gonzalo had unilaterally rescinded the deed of assignment by means of an affidavit of cancellation of deed of assignment dated April
19, 1999 filed in the DPWH on April 22, 1999;4 and that the disbursement voucher for the 10% retention fee had then been issued in the name of Gonzalo,
and the retention fee released to him.5
Tarnate demanded the payment of the retention fee from Gonzalo, but to no avail. Thus, he brought this suit against Gonzalo on September 13, 1999 in the
Regional Trial Court (RTC) in Mountain Province to recover the retention fee of P233,526.13, moral and exemplary damages for breach of contract, and
attorneys fees.6
In his answer, Gonzalo admitted the deed of assignment and the authority given therein to Tarnate, but averred that the project had not been fully implemented
because of its cancellation by the DPWH, and that he had then revoked the deed of assignment. He insisted that the assignment could not stand independently
due to its being a mere product of the subcontract that had been based on his contract with the DPWH; and that Tarnate, having been fully aware of the
illegality and ineffectuality of the deed of assignment from the time of its execution, could not go to court with unclean hands to invoke any right based on the
invalid deed of assignment or on the product of such deed of assignment.7
Ruling of the RTC
On January 26, 2001, the RTC, opining that the deed of assignment was a valid and binding contract, and that Gonzalo must comply with his obligations
under the deed of assignment, rendered judgment in favor of Tarnate as follows:
WHEREFORE, premises considered and as prayed for by the plaintiff, John Tarnate, Jr. in his Complaint for Sum of Money, Breach of Contract With Damages
is hereby RENDERED in his favor and against the above-named defendant Domingo Gonzalo, the Court now hereby orders as follows:
1. Defendant Domingo Gonzalo to pay the Plaintiff, John Tarnate, Jr., the amount of TWO HUNDRED THIRTY THREE THOUSAND FIVE HUNDRED
TWENTY SIX and 13/100 PESOS (P233,526.13) representing the rental of equipment;
157
2. Defendant to pay Plaintiff the sum of THIRTY THOUSAND (P30,000.00) PESOS by way of reasonable Attorneys Fees for having forced/compelled the
plaintiff to litigate and engage the services of a lawyer in order to protect his interest and to enforce his right. The claim of the plaintiff for attorneys fees in the
amount of FIFTY THOUSAND PESOS (P50,000.00) plus THREE THOUSAND PESOS (P3,000.00) clearly appears to be unconscionable and therefore
reduced to Thirty Thousand Pesos (P30,000.00) as aforestated making the same to be reasonable;
3. Defendant to pay Plaintiff the sum of FIFTEEN THOUSAND PESOS (P15,000.00) by way of litigation expenses;
4. Defendant to pay Plaintiff the sum of TWENTY THOUSAND PESOS (P20,000.00) for moral damages and for the breach of contract; and
5. To pay the cost of this suit.
Award of exemplary damages in the instant case is not warranted for there is no showing that the defendant acted in a wanton, fraudulent, reckless, oppressive
or malevolent manner analogous to the case of Xentrex Automotive, Inc. vs. Court of Appeals, 291 SCRA 66.8
Gonzalo appealed to the Court of Appeals (CA).
Decision of the CA
On February 18, 2003, the CA affirmed the RTC.9
Although holding that the subcontract was an illegal agreement due to its object being specifically prohibited by Section 6 of Presidential Decree No. 1594;
that Gonzalo and Tarnate were guilty of entering into the illegal contract in violation of Section 6 of Presidential Decree No. 1594; and that the deed of
assignment, being a product of and dependent on the subcontract, was also illegal and unenforceable, the CA did not apply the doctrine of in pari delicto,
explaining that the doctrine applied only if the fault of one party was more or less equivalent to the fault of the other party. It found Gonzalo to be more guilty
than Tarnate, whose guilt had been limited to the execution of the two illegal contracts while Gonzalo had gone to the extent of violating the deed of assignment.
It declared that the crediting of the 10% retention fee equivalent to P233,256.13 to his account had unjustly enriched Gonzalo; and ruled, accordingly, that
Gonzalo should reimburse Tarnate in that amount because the latters equipment had been utilized in the project.
Upon denial of his motion for reconsideration,10 Gonzalo has now come to the Court to seek the review and reversal of the decision of the CA.
Issues
Gonzalo contends that the CA erred in affirming the RTC because: (1) both parties were in pari delicto; (2) the deed of assignment was void; and (3) there
was no compliance with the arbitration clause in the subcontract.
Gonzalo submits in support of his contentions that the subcontract and the deed of assignment, being specifically prohibited by law, had no force and effect;
that upon finding both him and Tarnate guilty of violating the law for executing the subcontract, the RTC and the CA should have applied the rule of in pari
delicto, to the effect that the law should not aid either party to enforce the illegal contract but should leave them where it found them; and that it was erroneous
to accord to the parties relief from their predicament.11
Ruling
158
We deny the petition for review, but we delete the grant of moral damages, attorneys fees and litigation expenses.
There is no question that every contractor is prohibited from subcontracting with or assigning to another person any contract or project that he has with the
DPWH unless the DPWH Secretary has approved the subcontracting or assignment. This is pursuant to Section 6 of Presidential Decree No. 1594, which
provides:
Section 6. Assignment and Subcontract. The contractor shall not assign, transfer, pledge, subcontract or make any other disposition of the contract or any
part or interest therein except with the approval of the Minister of Public Works, Transportation and Communications, the Minister of Public Highways, or the
Minister of Energy, as the case may be. Approval of the subcontract shall not relieve the main contractor from any liability or obligation under his contract with
the Government nor shall it create any contractual relation between the subcontractor and the Government.
Gonzalo, who was the sole contractor of the project in question, subcontracted the implementation of the project to Tarnate in violation of the statutory
prohibition. Their subcontract was illegal, therefore, because it did not bear the approval of the DPWH Secretary. Necessarily, the deed of assignment was
also illegal, because it sprung from the subcontract. As aptly observed by the CA:
x x x. The intention of the parties in executing the Deed of Assignment was merely to cover up the illegality of the sub-contract agreement. They knew for a
fact that the DPWH will not allow plaintiff-appellee to claim in his own name under the Sub-Contract Agreement.
Obviously, without the Sub-Contract Agreement there will be no Deed of Assignment to speak of. The illegality of the Sub-Contract Agreement necessarily
affects the Deed of Assignment because the rule is that an illegal agreement cannot give birth to a valid contract. To rule otherwise is to sanction the act of
entering into transaction the object of which is expressly prohibited by law and thereafter execute an apparently valid contract to subterfuge the illegality. The
legal proscription in such an instance will be easily rendered nugatory and meaningless to the prejudice of the general public.12
Under Article 1409 (1) of the Civil Code, a contract whose cause, object or purpose is contrary to law is a void or inexistent contract. As such, a void contract
cannot produce a valid one.13 To the same effect is Article 1422 of the Civil Code, which declares that "a contract, which is the direct result of a previous
illegal contract, is also void and inexistent."
We do not concur with the CAs finding that the guilt of Tarnate for violation of Section 6 of Presidential Decree No. 1594 was lesser than that of Gonzalo, for,
as the CA itself observed, Tarnate had voluntarily entered into the agreements with Gonzalo.14 Tarnate also admitted that he did not participate in the bidding
for the project because he knew that he was not authorized to contract with the DPWH.15 Given that Tarnate was a businessman who had represented
himself in the subcontract as "being financially and organizationally sound and established, with the necessary personnel and equipment for the performance
of the project,"16 he justifiably presumed to be aware of the illegality of his agreements with Gonzalo. For these reasons, Tarnate was not less guilty than
Gonzalo.
According to Article 1412 (1) of the Civil Code, the guilty parties to an illegal contract cannot recover from one another and are not entitled to an affirmative
relief because they are in pari delicto or in equal fault. The doctrine of in pari delicto is a universal doctrine that holds that no action arises, in equity or at law,
159
from an illegal contract; no suit can be maintained for its specific performance, or to recover the property agreed to be sold or delivered, or the money agreed
to be paid, or damages for its violation; and where the parties are in pari delicto, no affirmative relief of any kind will be given to one against the other.17
Nonetheless, the application of the doctrine of in pari delicto is not always rigid.1wphi1 An accepted exception arises when its application contravenes well-
established public policy.18 In this jurisdiction, public policy has been defined as "that principle of the law which holds that no subject or citizen can lawfully
do that which has a tendency to be injurious to the public or against the public good."19
Unjust enrichment exists, according to Hulst v. PR Builders, Inc.,20 "when a person unjustly retains a benefit at the loss of another, or when a person retains
money or property of another against the fundamental principles of justice, equity and good conscience." The prevention of unjust enrichment is a recognized
public policy of the State, for Article 22 of the Civil Code explicitly provides that "[e]very person who through an act of performance by another, or any other
means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him." It is well to
note that Article 22 "is part of the chapter of the Civil Code on Human Relations, the provisions of which were formulated as basic principles to be observed
for the rightful relationship between human beings and for the stability of the social order; designed to indicate certain norms that spring from the fountain of
good conscience; guides for human conduct that should run as golden threads through society to the end that law may approach its supreme ideal which is
the sway and dominance of justice."21
There is no question that Tarnate provided the equipment, labor and materials for the project in compliance with his obligations under the subcontract and the
deed of assignment; and that it was Gonzalo as the contractor who received the payment for his contract with the DPWH as well as the 10% retention fee
that should have been paid to Tarnate pursuant to the deed of assignment.22 Considering that Gonzalo refused despite demands to deliver to Tarnate the
stipulated 10% retention fee that would have compensated the latter for the use of his equipment in the project, Gonzalo would be unjustly enriched at the
expense of Tarnate if the latter was to be barred from recovering because of the rigid application of the doctrine of in pari delicto. The prevention of unjust
enrichment called for the exception to apply in Tarnates favor. Consequently, the RTC and the CA properly adjudged Gonzalo liable to pay Tarnate the
equivalent amount of the 10% retention fee (i.e., P233,526.13).
Gonzalo sought to justify his refusal to turn over the P233,526.13 to Tarnate by insisting that he (Gonzalo) had a debt of P200,000.00 to Congressman Victor
Dominguez; that his payment of the 10% retention fee to Tarnate was conditioned on Tarnate paying that debt to Congressman Dominguez; and that he
refused to give the 10% retention fee to Tarnate because Tarnate did not pay to Congressman Dominguez.23 His justification was unpersuasive, however,
because, firstly, Gonzalo presented no proof of the debt to Congressman Dominguez; secondly, he did not competently establish the agreement on the
condition that supposedly bound Tarnate to pay to Congressman Dominguez;24 and, thirdly, burdening Tarnate with Gonzalos personal debt to Congressman
Dominguez to be paid first by Tarnate would constitute another case of unjust enrichment.
The Court regards the grant of moral damages, attorneys fees and litigation expenses to Tarnate to be inappropriate. We have ruled that no damages may
be recovered under a void contract, which, being nonexistent, produces no juridical tie between the parties involved.25 It is notable, too, that the RTC and the
CA did not spell out the sufficient factual and legal justifications for such damages to be granted.
Lastly, the letter and spirit of Article 22 of the Civil Code command Gonzalo to make a full reparation or compensation to Tarnate. The illegality of their contract
should not be allowed to deprive Tarnate from being fully compensated through the imposition of legal interest. Towards that end, interest of 6% per annum
160
reckoned from September 13, 1999, the time of the judicial demand by Tarnate, is imposed on the amount of P233,526.13. Not to afford this relief will make
a travesty of the justice to which Tarnate was entitled for having suffered too long from Gonzalos unjust enrichment.
WHEREFORE, we AFFIRM the decision promulgated on February 18, 2003, but DELETE the awards of moral damages, attorneys fees and litigation
expenses; IMPOSE legal interest of 6% per annum on the principal oLP233,526.13 reckoned from September 13, 1999; and DIRECT the petitioner to pay
the costs of suit.
SO ORDERED.
BLISS DEVELOPMENT VS DIAZ 2015
The Case
This is a Petition for Review on Certiorari assailing the Decision1 of the Court of Appeals (CA), promulgated on January 21, 2014, and its subsequent
Resolution dated June 27, 2014, both in CA-G.R. CV No. 99179. The assailed Decision reversed and set aside the Decision of the Regional Trial Court (RTC),
Makati City, Branch 59, dated November 21, 2011, in Civil Case No. 96-1372. The assailed Resolution, meanwhile, denied petitioners Motion for
Reconsideration.
The Facts
Petitioner Bliss Development Corporation (BDC) (subsequently reorganized as Home Guaranty Corporation) is the registered owner of Lot No. 27, Block 30,
New Capitol Estates I, Brgy. Matandang Balara, Diliman, Quezon City, and covered by Transfer Certificate of Title (TCT) No. 331582. On October 19, 1984,
it entered into and executed a Deed of Sale over the said property in favor of Spouses Emiliano and Leonila Melgazo (Sps. Melgazo), both of whom are now
deceased.2redarclaw
On May 7, 1991, a certain Rodolfo Nacua (Nacua) sent a letter to BDC, saying that Sps. Melgazo transferred to him their rights over the property. He further
expressed willingness to pay the outstanding obligations of Sps. Melgazo to BDC. Before the property was fully paid, however, Nacua sold his rights to Olivia
Garcia (Garcia), through a Deed of Transfer of Rights. Later, Garcia transferred her rights to Elizabeth Reyes (Reyes). Reyes then transferred her rights to
Domingo Tapay (Tapay), who then later sold his rights to herein respondent Montano Diaz (Diaz) for Six Hundred Thousand Pesos (P600,000.00). Diaz then
paid BDC the amortizations due on the property, amounting to P406,915.15, and BDC issued a permit to occupy the property in favor of Diaz. Diaz then
introduced improvements on the property, amounting to P700,000.00.
On April 14, 1992, BDC executed a Contract to Sell in favor of Diaz.3 On April 15, 1994, however, BDC informed Diaz that respondent Edgar Arreza (Arreza)
was claiming that the heirs of Sps. Melgazo sold to him the rights over the property.4 BDC then placed Diazs account in inactive status. To resolve the
conflicting claims of Arreza and Diaz, BDC filed a complaint for Interpleader against them, before the RTC, Makati City, Branch 146. On March 27, 1996, the
Makati City RTC Branch 146 ruled that the signatures of Sps. Melgazo transferring their rights to Nacua were mere forgeries. Thus, it ruled that Arreza had a
better right over the property. This decision became final and executory.5redarclaw
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On August 27, 1996, Diaz filed the present complaint for sum of money against BDC before the RTC, Makati City, Branch 59.6 This was later amended to
include Arreza and Tapay as defendants. Diaz argued that BDC and Tapays representations led him to believe that he had a good title over the property, but
due to the courts ruling in the interpleader case, he was constrained to transfer the property to Arreza. Thus, he prayed for the following:LawlibraryofCRAlaw
(1) For BDC and Arreza to pay him P1,106,915.58, plus interest, representing the amount he paid for the assumption of Tapays rights;
(2) For Tapay to pay him P600,000.00, plus interests, representing the amount he paid Tapay;
(3) For BDC and Tapay to pay him P500,000.00 as moral damages;
(4) For BDC to pay him P500,000 as exemplary damages; and
(5) For BDC, Tapay, and Arreza to pay him P100,000 as attorneys fees and costs of suit.7
Both BDC and Tapay argued that their respective acts were lawful and done in good faith.Arreza filed a Motion to Dismiss, citing res judicata, arguing that the
claim of Diaz is a compulsory counterclaim that should have been pleaded in the Interpleader case. The RTC denied the Motion to Dismiss, which the CA, on
certiorari, affirmed. When the issue reached this Court in G.R. No. 133113,8 this Court ruled that the claim as against Arreza is barred by res judicata. The
Court upheld the argument that the claim is in the nature of a compulsory counterclaim. Thus, the case against Arreza was dismissed.
The Decision of the RTC
After trial, the RTC rendered its Decision on November 21, 2011, finding that Diaz failed to prove that he is an assignee in good faith, and thus dismissed the
complaint for lack of merit in this wise:LawlibraryofCRAlaw
Plaintiff must show that he inquired not only into the title of the assignor but also into the assignors capacity to convey. The failure of plaintiff to diligently
inquire as such, indicated that he is not an assignee in good faith. Plaintiff Diaz downplays the need to extend his examination to intervening transferor farther
than Domingo Tapay from whom he acquired the subject property. Such attitude, however, is not in accord with what a reasonably prudent person would do
under the circumstances.
xxxx
WHEREFORE, premises considered, plaintiffs Complaint is hereby DISMISSED for lack of merit. Defendant Domingo Tapays [counterclaim] is likewise
dismissed. No costs.9
Aggrieved, Diaz appealed to the CA.
The Decision of the CA
In its presently assailed Decision promulgated on January 21, 2014, the CA reversed the ruling of the RTC and, instead,ruled that Diaz is entitled to be paid
reimbursement and damages. The CA anchored its ruling on its finding that Diaz is both a buyer in good faith and a builder in good faith,
thus:LawlibraryofCRAlaw
162
A careful examination of the records convinces Us that Diaz is both a buyer and builder in good faith. We note that while Bliss executed a Deed of Sale with
Mortgage in favor of the spouses Emiliano and Leonila Melgazo, title over the property was in Bliss name. The title remained in Bliss name when Tapay
offered to transfer his rights over the property to Diaz. Considering that the property involved is registered land, Diaz need not go beyond the title to be
considered a buyer in good faith. Indeed, after Diaz accepted Tapays offer, he dealt directly with Bliss which received the monthly amortizations due on the
property. For almost three years, from 1991 to 1994, Bliss accepted Diazs payment without informing Diaz of Arrezas conflicting claim over the property.
Bliss even issued Diaz a permit to occupy the property in 1992; thus, allowing Diaz to introduce improvements on the property. In other words, at the time
when Diaz purchased the property from Tapay and when he introduced the improvements, he had no notice that some other person has a right over the
property. He also had a well-founded belief that the property he was building on was his. Accordingly, Diaz is a buyer and builder in good faith.10
In ruling that Diaz is a buyer in good faith, the CA noted that Diaz need not go beyond the title to be considered a buyer in good faith, because what is involved
is a registered land.
With regard to the liability of BDC, the CA ruled that the provision in the Contract to Sell excusing it from reimbursing the monthly amortizations to Diaz cannot
exempt it from liability, because it acted in bad faith. The CA said:LawlibraryofCRAlaw
Next, Bliss argument that the Additional Provision in the Contract to Sell excuses it from reimbursing the monthly amortizations paid by Diaz cannot be given
credence. Any stipulation exempting the vendor from the obligation to answer for eviction shall be void, if he acted in bad faith. The vendors bad faith consists
in his knowledge beforehand at the time of the sale, of the presence of the fact giving rise to eviction, and its possible consequence. It is undisputed that Bliss
knew about Arrezas claim in 1991. It even received amortization payments from Arreza. Yet, Bliss is aware that should Arreza pursue his claim in court, Diaz
may be evicted from the property. Yet, Bliss only informed Diaz about Arrezas claim in 1994 when Arreza followed up his claim. Indubitably, Bliss acted in
bad faith in dealing with Diaz and should not be absolved from liability by the Additional Provision in the Contract to Sell.11
Thus, the CA dispositively held:LawlibraryofCRAlaw
FOR THESE REASONS, the November 21, 2011 Decision of the Regional Trial Court of Makati City, Branch 59, is SET ASIDE. The Court hereby DIRECTS:
(1) Defendant-appellee Bliss Development Corporation/Home Guaranty Corporation to PAY plaintiff-apellant Montano Diaz P1,106,915.58 for the
amortizations paid and amount spent on improvements on the property, P100,000.00 as moral damages, P50,000.00 as exemplary damages, and P25,000.00
as attorneys fee; and (2) defendant-appellee Domingo Tapay to PAY plaintiff-appellant Montano M. Diaz P600,000.00, the amount he paid for the transfer of
rights.
Petitioner BDC moved for reconsideration, insisting that Diaz cannot be declared a buyer in good faith, in light of the March 27, 1996 Decision of the Makati
City RTC, Branch 146 in the Interpleader case, which had long been final and executory. Tapay also moved for reconsideration, arguing that he was not
aware of the defect in the title sold to Diaz, and, hence, he should not be made liable for the P600,000.00 that Diaz paid to him. In the CAs assailed Resolution
dated June 27, 2014,12 the CA denied both motions for reconsideration.
Hence, the present Petition for Review on Certiorari filed by BDC, raising the following issues:LawlibraryofCRAlaw
163
I. WHETHER THE CA ERREDIN NOT DISMISSING THE APPEAL, IN VIEW OF THE APPLICATION OF THE DOCTRINE OF IMMUTABILITY OF
JUDGMENT IN THE DECISION OF THE COURT IN G.R. NO. 133113
II. WHETHER THE CA ERRED IN DECLARING BDC IN BAD FAITH
III. WHETHER THE CA ERRED IN DECLARING THAT THERE WAS UNJUST ENRICHMENT ON THE PART OF BDC
IV. WHETHER DIAZ CAN STILL CLAIM REIMBURSEMENT EVEN IF UNDER THE CONTRACT, HIS POSSESSION IS IN THE NATURE OF A LESSOR
V. WHETHER BDC IS LIABLE TO REIMBURSE DIAZ OF THE AMOUNT OF P1,106,915.58
In fine, petitioner argues that it is not liable to respondent Diaz, both for the amortizations that Diaz paid to it, and the value of the improvements that Diaz
introduced to the property.
Meanwhile, Tapay failed to elevate before this Court the CAs ruling against him.
The Courts Ruling
The petition is partially granted. The CA committed reversible error in ruling that Diaz was a buyer in good faith and for value. Nevertheless, BDC is liable to
Diaz because it acted in bad faith, as discussed below.
The claim is not barred by the

doctrine of immutability of judgment
First, We dispose of the issue of the applicability of the doctrine of immutability of judgment, in view of the ruling of this Court in G.R. No. 133113. We find that
the present claim is not barred by the courts ruling in G.R. No. 133113to the effect that Diaz can no longer claim reimbursement from Arrezabecause of
res judicatafor his failure to allege the claim in the interpleader case between them.
In G.R. No. 133113, We ruled that the claim against Arreza is barred by res judicata, because of a prior Interpleader case between Arreza and Diaz. We ruled
that the claim for reimbursement should have been alleged and proved in the prior case, and failure to do so bars any future action on such claims. We
reiterated the rule on res judicata, thus:LawlibraryofCRAlaw
In cases involving res adjudicata, the parties and the causes of action are identical or substantially the same in the prior as well as the subsequent action.
The judgment in the first action is conclusive as to every matter offered and received therein and as to any other matter admissible therein and which might
have been offered for that purpose, hence said judgment is an absolute bar to a subsequent action for the same cause.The bar extends to questions
necessarily involved in an issue, and necessarily adjudicated, or necessarily implied in the final judgment, although no specific finding may have been made
in reference thereto, and although such matters were directly referred to in the pleadings and were not actually or formally presented. Said prior judgment is
164
conclusive in a subsequent suit between the same parties on the same subject matter, and on the same cause of action, not only as to matters which were
decided in the first action, but also as to every other matter which the parties could have properly set up in the prior suit.13 (emphasis added)
In the case at bar, We find that the essential elements of res judicata are not present. First, the interpleader case was between Arreza and Diaz. While it was
BDC that initiated the interpleader case, the opposing parties in that prior case is, in fact, Arreza and Diaz. Second, the issues resolved in the interpleader
case revolved around the conflicting claims of Arreza and Diaz, and not whatever claim either of them may have against BDC. Thus, there is no identity of
parties, nor identity of subject matter, between the interpleader case and the one at bar.
Petitioner BDC acted in bad faith

in dealing with respondent Diaz
On the second issue, We find that the CA committed no reversible error in finding that BDC acted in bad faith, when it allowed Diaz to take over the payment
of the amortizations over the subject property. As the CA correctly noted, It is undisputed that Bliss knew about Arrezas claim in 1991. It even received
amortization payments from Arreza. Yet, Bliss acknowledged the transfer to Diaz and received the monthly amortizations paid by Diaz. Also, Bliss is aware
that should Arreza pursue his claim in court, Diaz may be evicted from the property.14redarclaw
BDC anchors its claim of good faith on the fact that it did not act as seller to Diaz. Rather, BDC claims, it was Diaz who came forward and presnted himself
to BDC as the lawful successor-in-interest of Emiliano and Leonila Melgazo, by virtue of the several deeds of transfer of rights, all of which he presented to
BDC. It was on the basis of this claim that BDC allowed Diaz to occupy the property and pay amortizations accruing over the property.15redarclaw
Nevertheless, BDC does not dispute that as early as 1991, even before respondent came forward presenting the deeds of transfer to BDC, BDC was already
aware of the claim of Arreza. In fact, it even received amortizations from Arreza. Despite this, BDC also later acknowledged the transfer to Diaz, and also
accepted amortizations from him.16 This uncontroverted sequence of events led the CA to correctly rule that BDC, indeed, acted in bad faith.
When Diaz came forward and presented the deeds of transfer, including the deed of transfer executed by Tapay in his favor, BDC was already well aware of
a conflicting claim by Arreza. Instead of waiting for the resolution on the matter, BDC immediately accepted the deed of transfer presented by Diaz, as well
as the amortizations he paid over the property. It was only in 1994 that BDC filed the Interpleader case to resolve the conflicting case. This is nothing short of
evident bad faith.
Respondent Diaz is not a purchaser

for value and in good faith
We,however, fail to find sufficient basis for the CAs ruling that Diaz is a purchaser for value and in good faith. In a long line of cases, this Court had ruled that
a purchaser in good faith and for value is one who buys property of another without notice that some other person has a right to, or interest in, such property
and pays full and fair price for the same at the time of such purchase or before he or she has notice of the claim or interest of some other person in the
property.17For one to be considered a purchaser in good faith, the following requisites must concur: (1) that the purchaser buys the property of another
without notice that some other person has a right to or interest in such property; and (2) that the purchaser pays a full and fair price for the property at the
time of such purchase or before he or she has notice of the claim of another.18 We find that in the case at bar, the first element is lacking.
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The CA, in disposing the issue of Diazs good faith, merely said that considering that the property involved is registered land, Diaz need not go beyond the
title to be considered a buyer in good faith.19We find this to be a serious and reversible error on the part of the CA. In the first place, while it is true that the
subject lot is registered lot, the doctrine of not going beyond the face of the title does not apply in the case here, because what was subjected to a series of
sales was not the lot itself but the right to purchase the lot from BDC. The CA itself observed: while [BDC] executed a Deed of Sale with Mortgage in favor of
the spouses Emiliano and Leonila Melgazo, title over the property was in [BDCs] name. The title remained in [BDCs] name when Tapay offered to transfer
his rights over the property to Diaz.20Notably, the several transfers themselves did not purport to be Deeds of Absolute Sale, but merely deeds of assignment
of rights. The subject of those deeds of assignment was never the real right over the subject property, but merely the personal right to purchase it. Therefore,
the mirror doctrine finds no application in the case at bar.
A careful review of the records of this case reveals that Diaz, in fact, failed to diligently inquire into the title of his predecessor before entering into the contract
of sale. As such, he cannot be considered a buyer in good faith. There is no issue that despite the several transfers of rights from Nacua to Garcia to Reyes
to Tapay to Diaz, title over the property remained in BDCs name.When Diaz transacted with Tapay, it was also clear that what was being transferred was
merely rights to purchase the property, and not title over the lot itself; if it were, the sale would have been void because Tapay never had ownership over the
subject property. As the buyer in such a transaction, it was incumbent upon Diaz not only to inquire as to the right of Tapay to transfer his rights, but also to
trace the source of that right to purchase the property. Had he discharged this duty diligently, he would have found out that Nacuas right was without basis,
because it was founded on a forged deed. For his failure to inquire diligently and trace the source of the right to purchase the property, Diaz cannot claim to
be a purchaser in good faith and for value.
Petitioner BDC is liable to return the

amortizations paid by respondent Diaz,
under the doctrine of unjust enrichment
Notwithstanding the fact that Diaz is not an innocent purchaser in good faith and for value, BDC is nevertheless liable to return to him the amortizations which
he already paid on the property, applying the rule on unjust enrichment.
Unjust enrichment exists when a person unjustly retains a benefit to the loss of another, or when a person retains money or property of another against the
fundamental principles of justice, equity and good conscience. Under Article 22 of the Civil Code,21 there is unjust enrichment when (1) a person is unjustly
benefited and (2) such benefit is derived at the expense of or with damages to another.22redarclaw
Allowing BDC to keep the amortizations paid by Diaz is tantamount to unjust enrichment. It would result in BDC receiving amortizations twice the amount it
should have received, that is, the amortizations paid by Diaz and Arreza. While BDC claims that it did not receive amortizations from both Diaz and Arreza
covering the same period, such a claim is self-serving, and is not amply supported by any documentary evidence.
Even if BDC can prove that there was no overlap between the payments made by Diaz and those made by Arreza, allowing it to keep the amortizations paid
by Diaz still amounts to unjust enrichment. As a direct result of the final and executory ruling that Arreza is the rightful buyer of the subject property, the buyer-
seller relationship between Diaz and BDC is rendered null and void. Consequently, there remains no valid consideration whatsoever for the payments made
by Diaz to BDC. There being no indication of intent to donate, because such payments were made under the impression that Diaz is the rightful buyer of the
property, it is only but just that Diaz be allowed to claim back what he has paid. This is only a natural consequence of the final and executory ruling that Diaz
166
is not the rightful buyer of the subject property. Allowing BDC to keep such payments, at the expense of and to the damage of Diaz, still amounts to unjust
enrichment.
Both parties being in bad faith,

BDC is liable to Diaz for the value
of the improvements he introduced
on the subject property
Next, We resolve the issue of whether BDC is liable to Diaz for the value of the improvements that Diaz introduced to the property. Arts. 448, 453, 546, and
548 of the Civil Code are material in resolving the issue:LawlibraryofCRAlaw
Art. 448. The owner of the land on which anything has been built, sown or planted in good faith, shall have the right to appropriate as his own the works,
sowing or planting, after payment of the indemnity provided for in Articles 546 and 548, or to oblige the one who built or planted to pay the price of the land,
and the one who sowed, the proper rent. However, the builder or planter cannot be obliged to buy the land if its value is considerably more than that of the
building or trees. In such case, he shall pay reasonable rent, if the owner of the land does not choose to appropriate the building or trees after proper indemnity.
The parties shall agree upon the terms of the lease and in case of disagreement, the court shall fix the terms thereof.
Art. 453. If there was bad faith, not only on the part of the person who built, planted or sowed on the land of another, but also on the part of the owner of such
land, the rights of one and the other shall be the same as though both had acted in good faith.
It is understood that there is bad faith on the part of the landowner whenever the act was done with his knowledge and without opposition on his part.
Art. 546. Necessary expenses shall be refunded to every possessor; but only the possessor in good faith may retain the thing until he has been reimbursed
therefor.
Useful expenses shall be refunded only to the possessor in good faith with the same right of retention, the person who has defeated him in the possession
having the option of refunding the amount of the expenses or of paying the increase in value which the thing may have acquired by reason thereof.
Art. 548. Expenses for pure luxury or mere pleasure shall not be refunded to the possessor in good faith; but he may remove the ornaments with which he
has embellished the principal thing if it suffers no injury thereby, and if his successor in the possession does not prefer to refund the amount expended.
The CA may have made the erroneous conclusion that Diaz acted in good faith, but because BDC equally acted in bad faith, Art. 453 of the Civil Code
commands that the rights of one and the other shall be the same as though both had acted in good faith. The CA made the correct observation then, when it
said:LawlibraryofCRAlaw
Under Article 448, the landowner is given the option, either to appropriate the improvement as his own upon payment of the proper amount of indemnity or to
sell the land to the possessor in good faith. Relatedly Article 546 provides that a builder in good faith is entitled to full reimbursement for all the necessary and
167
useful expenses incurred. In this case, however, the option of selling the land to the builder in good faith is no longer viable in light of the ruling in the
interpleader case. Hence, there is only one thing left for [BDC] to do: indemnify Diaz for the improvements introduced on the property.23
Nevertheless, because the law treats both parties as if they acted in good faith, the CA committed reversible error in awarding moral and exemplary damages,
there being no basis therefor. We find it proper to delete the award of P100,000.00 as moral damages, P50,000.00 as exemplary damages, and P25,000.00
as attorneys fees.
In sum, the CA correctly reversed the ruling of the RTC, and ordered BDC to pay Diaz the amount he paid as amortizations, as well as the value of the
improvements that he introduced on the subject property. However, because both parties acted in bad faith, there is no basis for the award of moral and
exemplary damages, as well as attorneys fees.
WHEREFORE, in view of the foregoing, the January 21, 2014 Decision of the Court of Appeals in CA-G.R. CV No. 99179 is hereby MODIFIED to read as
follows: (1) petitioner Bliss Development Corporation/Home Guaranty Corporation is ordered topay respondent Montano M. Diaz the amount of P1,106,915.58
for the amortizations paid and the amount spent on improvements on the property; and (2) Domingo Tapay is ordered to pay respondent Montano M. Diaz
the amount of P600,000.00, the amount he paid for the transfer of rights.
SO ORDERED.
CASTRO VS PEOPLE 2008
This petition for review on certiorari[1] emanated from the complaint for grave oral defamation[2] filed by Albert P. Tan against petitioner Jerome Castro.
The facts follow.
On November 11, 2002, Reedley International School (RIS) dismissed Tans son, Justin Albert (then a Grade 12 student), for violating the terms of his
disciplinary probation.[3] Upon Tans request, RIS reconsidered its decision but imposed non-appealable conditions such as excluding Justin Albert from
participating in the graduation ceremonies.
Aggrieved, Tan filed a complaint in the Department of Education (Dep-Ed) for violation of the Manual of Regulation of Private Schools, Education Act of 1982
and Article 19 of the Civil Code[4] against RIS. He alleged that the dismissal of his son was undertaken with malice, bad faith and evident premeditation. After
investigation, the Dep-Ed found that RIS code violation point system allowed the summary imposition of unreasonable sanctions (which had no basis in fact
and in law). The system therefore violated due process. Hence, the Dep-Ed nullified it. [5]
Meanwhile, on November 20, 2002, the Dep-Ed ordered RIS to readmit Justin Albert without any condition.[6] Thus, he was able to graduate from RIS and
participate in the commencement ceremonies held on March 30, 2003.
After the graduation ceremonies, Tan met Bernice C. Ching, a fellow parent at RIS. In the course of their conversation, Tan intimated that he was contemplating
a suit against the officers of RIS in their personal capacities, including petitioner who was the assistant headmaster.
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Ching telephoned petitioner sometime the first week of April and told him that Tan was planning to sue the officers of RIS in their personal capacities. Before
they hung up, petitioner told Ching:
Okay, you too, take care and be careful talking to [Tan], thats dangerous.
Ching then called Tan and informed him that petitioner said talking to him was dangerous.
Insulted, Tan filed a complaint for grave oral defamation in the Office of the City Prosecutor of Mandaluyong City against petitioner on August 21, 2003.
On November 3, 2003, petitioner was charged with grave oral defamation in the Metropolitan Trial Court (MeTC) of Mandaluyong City, Branch 60[7] under
the following Information:
That on or about the 13th day of March, 2003 in the City of Mandaluyong, Philippines, a place within the jurisdiction of this Honorable Court, the above-named
[petitioner], with deliberate intent of bringing ATTY. ALBERT P. TAN, into discredit, dishonor, disrepute and contempt, did then and there, willfully, unlawfully
and feloniously speak and utter the following words to Ms. Bernice C. Ching:
OK, YOU TOO, YOU TAKE CARE AND BE CAREFUL TALKING TO [TAN], THATS DANGEROUS.
and other words of similar import of a serious and insulting nature.
CONTRARY TO LAW.
Petitioner pleaded not guilty during arraignment.
The prosecution essentially tried to establish that petitioner depicted Tan as a dangerous person. Ching testified that petitioner warned her that talking to Tan
was dangerous. Tan, on the other hand, testified that petitioners statement shocked him as it portrayed him as someone capable of committing undesirable
acts. He added that petitioner probably took offense because of the complaint he filed against RIS in the Dep-Ed.
For his defense, petitioner denied harboring ill-feelings against Tan despite the latters complaint against RIS in the Dep-Ed. Although he admitted conversing
with Ching (whom he considered as a close acquaintance) on the telephone a few days after RIS 2003 commencement exercises, petitioner asserted that he
never said or insinuated that Tan or talking to Tan was dangerous. On cross-examination, however, he did not categorically deny the veracity of Chings
statement.
The MeTC found that Chings statements in her affidavit and in open court were consistent and that she did not have any motive to fabricate a false statement.
Petitioner, on the other hand, harbored personal resentment, aversion and ill-will against Tan since the Dep-Ed compelled RIS to readmit his son. Thus, the
MeTC was convinced that petitioner told Ching talking to Tan was dangerous and that he uttered the statement with the intention to insult Tan and tarnish his
social and professional reputation.
In a decision dated December 27, 2005, the MeTC found petitioner guilty beyond reasonable doubt of grave oral defamation:[8]
169
WHEREFORE, judgment is hereby rendered finding accused, Jerome Castro GUILTY beyond reasonable doubt of the crime of Grave Oral Defamation,
sentencing him therefore, in accordance to Article 358(1) of the Revised Penal Code and applying the Indeterminate Sentence Law to suffer the penalty of
imprisonment of 1 month and 1 day of arresto mayor as minimum to 4 months and 1 day of arresto mayor as maximum.
On appeal, the Regional Trial Court (RTC) affirmed the factual findings of the MeTC. However, in view of the animosity between the parties, it found petitioner
guilty only of slight oral defamation. But because Tan filed his complaint in the Office of the City Prosecutor of Mandaluyong City only on August 21, 2003 (or
almost five months from discovery), the RTC ruled that prescription had already set in; it therefore acquitted petitioner on that ground. [9]
On April 19, 2007, the Office of the Solicitor General (OSG) filed a petition for certiorari in the Court of Appeals (CA) assailing the decision of the RTC.[10] It
contended that the RTC acted with grave abuse of discretion when it downgraded petitioners offense to slight oral defamation. The RTC allegedly
misappreciated the antecedents which provoked petitioner to utter the allegedly defamatory statement against Tan.
The CA found that the RTC committed grave abuse of discretion when it misapprehended the totality of the circumstances and found petitioner guilty only of
slight oral defamation. Thus, the CA reinstated the MeTC decision.[11]
Petitioner moved for reconsideration but it was denied.[12] Hence, this recourse.
Petitioner basically contends that the CA erred in taking cognizance of the petition for certiorari inasmuch as the OSG raised errors of judgment (i.e., that the
RTC misappreciated the evidence presented by the parties) but failed to prove that the RTC committed grave abuse of discretion. Thus, double jeopardy
attached when the RTC acquitted him.
We grant the petition.
No person shall be twice put in jeopardy of punishment for the same offense.[13] This constitutional mandate is echoed in Section 7 of Rule 117 of the Rules
of Court which provides:
Section 7. Former conviction or acquittal; double jeopardy. When an accused has been convicted or acquitted or the case against him dismissed or otherwise
terminated without his express consent by a court of competent jurisdiction, upon a valid complaint or in information or other formal charge sufficient in form
and substance to sustain a conviction and after the accused had pleaded to the charge, the conviction or acquittal of the accused or the dismissal of the case
shall be a bar to another prosecution for the offense charged or for any attempt to commit the same or frustration thereof, or for any offense which necessarily
includes or is necessarily included in the offense charged in the former complaint or information.
xxxxxxxxx
Under this provision, double jeopardy occurs upon (1) a valid indictment (2) before a competent court (3) after arraignment (4) when a valid plea has been
entered and (5) when the accused was acquitted or convicted or the case was dismissed or otherwise terminated without the express consent of the
accused.[14] Thus, an acquittal, whether ordered by the trial or appellate court, is final and unappealable on the ground of double jeopardy.[15]
170
The only exception is when the trial court acted with grave abuse of discretion or, as we held in Galman v. Sandiganbayan,[16] when there was mistrial. In
such instances, the OSG can assail the said judgment in a petition for certiorari establishing that the State was deprived of a fair opportunity to prosecute and
prove its case.[17]
The rationale behind this exception is that a judgment rendered by the trial court with grave abuse of discretion was issued without jurisdiction. It is, for this
reason, void. Consequently, there is no double jeopardy.
In this case, the OSG merely assailed the RTCs finding on the nature of petitioners statement, that is, whether it constituted grave or slight oral defamation.
The OSG premised its allegation of grave abuse of discretion on the RTCs erroneous evaluation and assessment of the evidence presented by the parties.
What the OSG therefore questioned were errors of judgment (or those involving misappreciation of evidence or errors of law). However, a court, in a petition
for certiorari, cannot review the public respondents evaluation of the evidence and factual findings.[18] Errors of judgment cannot be raised in a Rule 65
petition as a writ of certiorari can only correct errors of jurisdiction (or those involving the commission of grave abuse of discretion).[19]
Because the OSG did not raise errors of jurisdiction, the CA erred in taking cognizance of its petition and, worse, in reviewing the factual findings of the
RTC.[20] We therefore reinstate the RTC decision so as not to offend the constitutional prohibition against double jeopardy.
At most, petitioner could have been liable for damages under Article 26 of the Civil Code[21]:
Article 26. Every person shall respect the dignity, personality, privacy and peace of mind of his neighbors and other persons. The following and similar acts,
though they may not constitute a criminal offense, shall produce a cause of action for damages, prevention and other relief:
xxxxxxxxx
(3) Intriguing to cause another to be alienated from his friends;
xxxxxxxxx
Petitioner is reminded that, as an educator, he is supposed to be a role model for the youth. As such, he should always act with justice, give everyone his due
and observe honesty and good faith.[22]
WHEREFORE, the petition is hereby GRANTED. The August 29, 2007 decision and December 5, 2007 resolution of the Court of Appeals in CA-G.R. SP No.
98649 are REVERSED and SET ASIDE. The November 20, 2006 decision of the Regional Trial Court of Mandaluyong City, Branch 212 is REINSTATED.
Petitioner Jerome Castro is ACQUITTED of slight oral defamation as defined and penalized in Article 358 of the Revised Penal Code.
SO ORDERED.
LEDESMA VS CA AND DELMO 1988
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This petition seeks to reverse the decision of the respondent Court of Appeals which afirmed the decision of the Court of First Instance of Iloilo, adjudging the
petitioner, who was then the President of the West Visayas College liable for damages under Article 27 of the Civil Code of the Philippines for failure to
graduate a student with honors.
The facts are not disputed.
An organization named Student Leadership Club was formed by some students of the West Visayas College. They elected the late Violets Delmo as the
treasurer. In that capacity, Delmo extended loans from the funds of the club to some of the students of the school. "the petitioner claims that the said act of
extending loans was against school rules and regulations. Thus, the petitioner, as President of the School, sent a letter to Delmo informing her that she was
being dropped from the membership of the club and that she would not be a candidate for any award or citation from the school.
Delmo asked for a reconsideration of the decision but the petitioner denied it. Delmo, thus, appealed to the Office of the Director of the Bureau of Public
Schools.
The Director after due investigation, rendered a decison on April 13, 1966 which provided:
Records of the preliminary investigation conducted by one of the legal officers of this Office disclosed the following: That Violeta Delmo was the treasurer of
the Student Leadership Club, an exclusive student organization; that pursuant to Article IX of the of the Constitution and By-Laws of the club, it passed
Resolution No. 2, authorizing the treasurer to disburse funds of the Club to student for financial aid and other humanitarian purposes; that in compliance with
said resolution and as treasurer of the Club, Violeta Delmo extended loans to some officers and members of the Club upon proper application duly approved
by the majority of the members of the Executive Board; and that upon receiving the report from Mr. Jesse Dagoon, adviser of the funds of the Club, that Office
conducted an investigation on the matter and having been convinced of the guilt of Violets Delmo and the other officers and members of the Club, that Office
rendered the order or decision in question. In justifying that Office's order or decision, it is contended that approval by that Office of the Constitution and By-
Laws of the Club is necessary for its effectivity and validity and since it was never submitted to that Office, the Club had no valid constitution and By-Laws
and that as a consequence, Resolution No. 2 which was passed based on the Constitution and By-Laws- is without any force and effect and the treasurer,
Violeta Delmo, who extended loans to some officers and members of the Club pursuant thereto are illegal (sic), hence, she and the other students involved
are deemed guilty of misappropriating the funds of the Club. On the other hand, Raclito Castaneda, Nestor Golez and Violeta Delmo, President, Secretary
and Treasurer of the Club, respectively, testified that the Club had adopted its Constitution and By-Laws in a meeting held last October 3, 1965, and that
pursuant to Article I of said Constitution and By-Laws, the majority of the members of the Executive Board passed Resolution No. 2, which resolution became
the basis for the extension on of loans to some officers and members of the Club, that the Club honestly believed that its Constitution and By-Laws has been
approved by the superintendent because the adviser of the Club, Mr. Jesse Dagoon, assured the President of the Club that he will cause the approval of the
Constitution and By-Laws by the Superintendent; the officers of the Club have been inducted to office on October 9,1965 by the Superintendent and that the
Club had been likewise allowed to cosponsor the Education Week Celebration.
After a careful study of the records, this Office sustains the action taken by the Superintendent in penalizing the adviser of the Club as well as the officers and
members thereof by dropping them from membership therein. However, this Office is convinced that Violets M. Delmo had acted in good faith, in her capacity
as Club Treasurer, in extending loans to the officers and members of the Student partnership Club. Resolution No. 2 authorizing the Club treasurer to discharge
finds to students in need of financial assistance and other humanitarian purposes had been approved by the Club adviser, Mr. Jesse Dagoon, with the notation
172
that approval was given in his capacity as adviser of the Club and extension of the Superintendent's personality. Aside from misleading the officers and
members of the Club, Mr. Dagoon, had unsatisfactorily explained why he failed to give the Constitution and By-Laws of the Club to the Superintendent for
approval despite his assurance to the Club president that he would do so. With this finding of negligence on the part of the Club adviser, not to mention laxity
in the performance of his duties as such, this Office considers as too severe and unwarranted that portion of the questioned order stating that Violeta Delmo
"shall not be a candidate for any award or citation from this school or any organization in this school." Violeta Delmo, it is noted, has been a consistent full
scholar of the school and she alone has maintained her scholarship. The decision in question would, therefore, set at naught all her sacrifice and frustrate her
dreams of graduating with honors in this year's commencement exercises.
In view of all the foregoing, this Office believes and so holds and hereby directs that appellant Violeta. M. Delmo, and for that matter all other Club members
or officers involved in this case, be not deprived of any award, citation or honor from the school, if they are otherwise entitled thereto. (Rollo, pp. 28-30)
On April 27, 1966, the petitioner received by mail the decision of the Director and all the records of the case. On the same day, petitioner received a telegram
stating the following:
"AIRMAIL RECORDS DELMO CASE MISSENT THAT OFFICE"
The Director asked for the return only of the records but the petitioner allegedly mistook the telegram as ordering him to also send the decision back. On the
same day, he returned by mail all the records plus the decision of the Director to the Bureau of Public Schools.
The next day, the petitioner received another telegram from the Director order him to furnish Delmo with a copy of the decision. The petitioner, in turn, sent a
night letter to the Director informing the latter that he had sent the decision back and that he had not retained a copy thereof..
On May 3, 1966, the day of the graduation, the petitioner received another telegram from the Director ordering him not to deprive Delmo of any honors due
her. As it was impossible by this time to include Delmo's name in the program as one of the honor students, the petitioner let her graduate as a plain student
instead of being awarded the Latin honor of Magna Cum Laude.
To delay the matter further, the petitioner on May 5, 1966, wrote the Director for a reconsideration of the latters" decision because he believed that Delmo
should not be allowed to graduate with honors. The Director denied the petitioner's request.
On July 12, 1966, the petitioner finally instructed the Registrar of the school to enter into the scholastic records of Delmo the honor, "Magna Cum Laude."
On July 30, 1966, Delmo, then a minor, was joined by her parents in flag action for damages against the petitioner. During the pendency of the action,
however, Delmo passed away, and thus, an Amended and Supplemental Complaint was filed by her parents as her sole and only heirs.
The trial court after hearing rendered judgment against the petitioner and in favor of the spouses Delmo. The court said:
Let us go to specific badges of the defendants (now petitioners) bad faith. Per investigation of Violeta Delmo's appeal to Director Vitaliano Bernardino of the
Bureau of Public Schools (Exhibit L it was the defendant who inducted the officers of the Student Leadership Club on October 9, 1965. In fact the Club was
173
allowed to cosponsor the Education Week Celebration. (Exh. "L"). If the defendant he not approve of the constitution and by-laws of the Club, why did he
induct the officers into office and allow the Club to sponsor the Education Week Celebration"? It was through his own act that the students were misled to do
as they did. Coupled with the defendants tacit recognition of the Club was the assurance of Mr. Jemm Dagoon, Club Adviser, who made the students believe
that he was acting as an extension of Mr. Ledesma's personality. (Exhibit "L").
Another badge of the defendan'ts want of good faith is the fact that, although, he kaew as early as April 27,1966 that per on of r Bernardino, Exhibit "L," he
was directed to give honors to Miss Delmo, he kept Id information to . He told the Court that he knew that the letter of Director Bernardino directed him not to
deprive Miss Delmo the honors due her, but she (sic) says that he has not finished reading the letter-decision, Exhibit "L," of Director Bernardino 0, him to
give honors to Miss Delmo. (Tsn, Feb. 5, 1974, testimony of Mr. Ledesma, pp. .33-35). It could not be true that he has not finished reading the letter-decision,
Exh. "L," because said letter consisted of only three pages, and the portion which directed that Miss Delmo "be not deprived of any award, citation or honor
from the school, if otherwise entitled thereto is found at the last paragraph of the same. How did he know the last paragraph if he did not read the letter.
Defendants actuations regarding Miss Delmo's cam had been one of bias and prejudice. When his action would favor him, he was deliberate and aspect to
the utter prejudice and detriment of Miss Delmo. Thus, although, as early as April 27, 1966, he knew of the exoneration of Miss Delino by Director Bernardino,
he withheld the information from Miss Delmo. This is eloquently dramatized by Exh. "11" and Exh. "13" On April 29,1966, Director Bernardino cabled him to
furnish Violeta Delmo copy of the Decision, Exh. "L," but instead of informing Miss Delmo about the decision, since he said he mailed back the decision on
April 28,1966, he sent a night letter on April 29,1966, to Director Bernardino, informing the latter that he had returned the decision (Exh. "l3"), together with
the record. Why a night letter when the matter was of utmost urgency to the parties in the case, because graduation day was only four days ahead? An
examination of the telegrams sent by the defendant shows that he had been sending ordinary telegram and not night letters. (Exh. "5", Exhibit "7"). At least,
if the defendant could not furnish a copy of the decision, (Exh. "L"), to Miss Delmo, he should have told her about it or that Miss Delmo's honors and citation
in the commencement be announced or indicated. But Mr. Ledesma is one who cannot admit a mistake. Very ungentlemanly this is home out by his own
testimony despite his knowledge that his decision to deprive Miss Delmo of honors due to her was overturned by Director Bernardino, he on his wrong belief.
To quote the defendant,1 believed that she did not deserve those honors(Tsn Feb. 5, 1974, p. 43,Empasized supplied). Despite the telegram of Director
Bernardino which the defendant received hours before the commencement executory on May 3-4,1966, he did not obey Director Bernardino because he said
in his testimony that he would be embarrassment . Tan Feb 5,1974, P. 46). Evidently, he knew only his embarrassment and not that of r Bernardino whose
order was being flagrantly and wantonly disregarded by bim And certainly, not the least of Miss Delmo's embarrassment. His acts speak eloquently of ho bad
faith and unjust of mindwarped by his delicate sensitivity for having been challenged by Miss Delmo, a mere student.
xxx xxx xxx

Finally the defendant's behaviour relative to Miss s case smacks of contemptuous arrogance, oppression and abuse of power. Come to think of it. He refused
to obey the directive of Be o and instead, chose to feign ignorance of it." (Reward on Appeal, p. 72-76).
The trial court awarded P20,000.00 to the estate of Violeta Delmo and P10,000.00 to her parents for moral damages; P5,000.00 for nominal damages to
Violeta's estate; exemplary damages of P10,000.00 and P2,000.00 attorney's fees.
On appeal, the Court of Appeals affirmed the decision. Hence, this petition.
174
The issues raised in this petition can be reduced to the sole question of whether or not the respondent Court of Appeals erred in affirming the trial court's
finding that petitioner is liable for damages under Article 27 of the New Civil Code.
We find no reason why the findings of the trial and appellate courts should be reversed. It cannot be disputed that Violeta Delmo went through a painful ordeal
which was brought about by the petitioner's neglect of duty and callousness. Thus, moral damages are but proper. As we have affirmed in the case of
(Prudenciado v. Alliance Transport System, Inc., 148 SCRA 440, 448):
There is no argument that moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral
shock, social humiliation, and similar injury. Though incapable of pecuniary computation, moral damages may be recovered if they are the proximate result of
defendant's wrongly act or omission." (People v. Baylon, 129 SCRA 62 (1984).
The Solicitor-General tries to cover-up the petitioner's deliberate omission to inform Miss Delmo by stating that it was not the duty of the petitioner to furnish
her a copy of the Director's decision. Granting this to be true, it was nevertheless the petitioner's duty to enforce the said decision. He could have done so
considering that he received the decision on April 27, 1966 and even though he sent it back with the records of the case, he undoubtedly read the whole of it
which consisted of only three pages. Moreover, the petitioner should have had the decency to meet with Mr. Delmo, the girl's father, and inform the latter, at
the very least of the decision. This, the petitioner likewise failed to do, and not without the attendant bad faith which the appellate court correctly pointed out
in its decision, to wit:
Third, assuming that defendant could not furnish Miss Delmo of a copy of the decision, he could have used his discretion and plain common sense by informing
her about it or he could have directed the inclusion of Miss Delmo's honor in the printed commencement program or announced it during the commencement
exercises.
Fourth, defendant despite receipt of the telegram of Director Benardino hours before the commencement exercises on May 3-4, 1966, disobeyed his superior
by refusing to give the honors due Miss Delmo with a lame excuse that he would be embarrassed if he did so, to the prejudice of and in complete disregard
of Miss Delmo's rights.
Fifth, defendant did not even extend the courtesy of meeting Mr. Pacifico Delmo, father of Miss Delmo, who tried several times to see defendant in his office
thus Mr. Delmo suffered extreme disappointment and humiliation.
xxx xxx xxx

Defendant, being a public officer should have acted with circumspection and due regard to the rights of Miss Delmo. Inasmuch as he exceeded the scope of
his authority by defiantly disobeying the lawful directive of his superior, Director Bernardino, defendant is liable for damages in his personal capacity. . . .
(Rollo, pp- 57-58)
Based on the undisputed facts, exemplary damages are also in order. In the same case of Prudenciado v. Alliance Transport System, Inc., supra., at p. 450,
we ruled:
175
The rationale behind exemplary or corrective damages is, as the name implies, to provide an example or correction for the public good (Lopez, et al. v. Pan
American World Airways, 16 SCRA 431).
However, we do not deem it appropriate to award the spouses Delmo damages in the amount of P10,000.00 in their individual capacity, separately from and
in addition to what they are already entitled to as sole heirs of the deceased Violeta Delmo. Thus, the decision is modified insofar as moral damages are
awarded to the spouses in their own behalf.
WHEREFORE, the petition is DISMISSED for lack of merit. The decision of the Court of Appeals is AFFIRMED with the slight modification as stated in the
preceding paragraph. This decision is immediately executory.
SO ORDERED.
CAMPUGAN VS TOLENTINO 2015
In this consolidated administrative case, complainants Jessie T. Campugan and Robert C. Torres seek the disbarment of respondents Atty. Federico S.
Tolentino, Jr., Atty. Daniel F. Victorio, Jr., Atty. Renato G. Cunanan, Atty. Elbert T. Quilala and Atty. Constante P. Caluya, Jr. for allegedly falsifying a court
order that became the basis for the cancellation of their annotation of the notice of adverse claim and the notice of lis pendens in the Registry of Deeds in
Quezon City.
Antecedents
Atty. Victorio, Jr. had replaced Atty. Edgardo Abad as counsel of the complainants in a civil action they brought to seek the annulment of Transfer Certificate
of Title (TCT) No. N-290546 of the Registry of Deeds of Quezon City in the first week of January 2007 in the Regional Trial Court (RTC) in Quezon City (Civil
Case No. Q-07-59598). They impleaded as defendants Ramon and Josefina Ricafort, Juliet Vargas and the Register of Deeds of Quezon City. They caused
to be annotated on TCT No. N-290546 their affidavit of adverse claim, as well as the notice of lis pendens.1 Atty. Tolentino, Jr. was the counsel of defendant
Ramon and Josefina Ricafort.
In their sworn complaint for disbarment dated April 23, 2009 (later docketed as A.C. No. 8261),2 the complainants narrated that as the surviving children of
the late Spouses Antonio and Nemesia Torres, they inherited upon the deaths of their parents a residential lot located at No. 251 Boni Serrano Street, Murphy,
Cubao, Quezon City registered under Transfer Certificate of Title (TCT) No. RT-64333(35652) of the Register of Deeds of Quezon City;3 that on August 24,
2006, they discovered that TCT No. RT-64333(35652) had been unlawfully cancelled and replaced by TCT No. N-290546 of the Register of Deeds of Quezon
City under the names of Ramon and Josefina Ricafort;4 and that, accordingly, they immediately caused the annotation of their affidavit of adverse claim on
TCT No. N-290546.
It appears that the parties entered into an amicable settlement during the pendency of Civil Case No. Q-07-59598 in order to end their dispute,5 whereby the
complainants agreed to sell the property and the proceeds thereof would be equally divided between the parties, and the complaint and counterclaim would
be withdrawn respectively by the complainants (as the plaintiffs) and the defendants. Pursuant to the terms of the amicable settlement, Atty. Victorio, Jr. filed
176
a Motion to Withdraw Complaint dated February 26, 2008,6 which the RTC granted in its order dated May 16, 2008 upon noting the defendants' lack of
objection thereto and the defendants' willingness to similarly withdraw their counterclaim.7
The complainants alleged that from the time of the issuance by the RTC of the order dated May 16, 2008, they could no longer locate or contact Atty. Victorio,
Jr. despite making several phone calls and visits to his office; that they found out upon verification at the Register of Deeds of Quezon City that new annotations
were made on TCT No. N-290546, specifically: (1) the annotation of the letter-request appearing to be filed by Atty. Tolentino, Jr.8 seeking the cancellation
of the affidavit of adverse claim and the notice of lis pendens annotated on TCT No. N-290546; and (2) the arinotation of the decision dated May 16, 2008
rendered in Civil Case No. Q-07-59598 by the RTC, Branch 95, in Quezon City, granting the complainants' Motion to Withdraw Complaint;9 and that a copy
of the letter-request dated June 30, 2008 addressed to Atty. Quilala, Registrar of Deeds of Quezon City, disclosed that it was defendant Ramon Ricafort who
had signed the letter.
Feeling aggrieved by their discovery, the complainants filed an appeal en consulta with the Land Registration Authority (LRA), docketed as Consulta No.
4707, assailing the unlawful cancellation of their notice of adverse claim and their notice of lis pendens under primary entries PE-2742 and PE-3828-9,
respectively. The LRA set Consulta No. 4707 for hearing on March 30, 2009, and directed the parties to submit their respective memoranda and/or supporting
documents on or before such scheduled hearing.10 However, the records do not disclose whether Consulta No. 4707 was already resolved, or remained
pending at the LRA.
Unable to receive any response or assistance from Atty. Victorio, Jr. despite their having paid him for his professional services, the complainants felt that said
counsel had abandoned their case. They submitted that the cancellation of their notice of adverse claim and their notice of lis pendens without a court order
specifically allowing such cancellation resulted from the connivance and conspiracy between Atty. Victorio, Jr. and Atty. Tolentino, Jr., and from the taking
advantage of their positions as officials in the Registry of Deeds by respondents Atty. Quilala, the Chief Registrar, and Atty. Cunanan, the acting Registrar
and signatory of the new annotations. Thus, they claimed to be thereby prejudiced.
On July 6, 2009, the Court required the respondents to comment on the verified complaint.11
Atty. Victorio, Jr. asserted in his Comment dated August 17, 200912 that complainant Robert Torres had been actively involved in the proceedings in Civil
Case No. Q-07-59598, which included the mediation process; that the complainants, after having aggressively participated in the drafting of the amicable
settlement, could not now claim that they had been deceived into entering the agreement in the same way that they could not feign ignorance of the conditions
contained therein; that he did not commit any abandonment as alleged, but had performed in good faith his duties as the counsel for the complainants in Civil
Case No. Q-07-59598; that he should not be held responsible for their representation in other proceedings, such as that before the LRA, which required a
separate engagement; and that the only payment he had received from the complainants were those for his appearance fees of P1,000.00 for every hearing
in the RTC.
In his Comment dated August 24, 2009,13 Atty. Tolentino, Jr. refuted the charge of conspiracy, stressing that he was not acquainted with the other
respondents, except Atty. Victorio, Jr. whom he had met during the hearings in Civil Case No. Q-07-59598; that although he had notarized the letter-request
dated June 30, 2008 of Ramon Ricafort to the Register of Deeds, he had no knowledge about how said letter-request had been disposed of by the Register
of Deeds; and that the present complaint was the second disbarment case filed by the complainants against him with no other motive except to harass and
intimidate him.
177
Atty. Quilala stated in his Comment dated September 1, 200914 that it was Atty. Caluya, Jr., another Deputy Register of Deeds, who was the actual signing
authority of the annotations that resulted in the cancellation of the affidavit of adverse claim and the notice of lis pendens on TCT No. N-290546; that the
cancellation of the annotations was undertaken in the regular course of official duty and in the exercise of the ministerial duty of the Register of Deeds; that
no irregularity occurred or was performed in the cancellation of the annotations; and that the Register of Deeds was impleaded in Civil Case No. Q-07-59598
only as a nominal party, thereby discounting any involvement in the proceedings in the case.
Atty. Cunanan did not file any comment.15
As the result of Atty. Quilala's allegation in his Comment in A.C. No. 8261 that it had been Atty. Caluya, Jr.'s signature that appeared below the cancelled
entries, the complainants filed another sworn disbarment complaint dated August 26, 2010 alleging that Atty. Caluya, Jr. had forged the signature of Atty.
Cunanan.16 This disbarment complaint was docketed as A.C. No. 8725, and was later on consolidated with A.C. No. 826117 because the complaints involved
the same parties and rested on similar allegations against the respondents.
Atty. Quilala filed his Comment in A.C. No. 8725 to belie the allegation of forgery and to reiterate the arguments he had made in A.C. No. 8261.18 On his part,
Atty. Caluya, Jr. manifested that he adopted Atty. Quilala's Comment.19
Ruling
We dismiss the complaints for disbarment for being bereft of merit.
Well entrenched in this jurisdiction is the rule that a lawyer may be disciplined for misconduct committed either in his professional or private capacity. The test
is whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or whether his conduct renders him unworthy to
continue as an officer of the Court.20 Verily, Canon 7 of the Code of Professional Responsibility mandates all lawyers to uphold at all times the dignity and
integrity of the Legal Profession. Lawyers are similarly required under Rule 1.01, Canon 1 of the same Code not to engage in any unlawful, dishonest and
immoral or deceitful conduct. Failure to observe these tenets of the Code of Professional Responsibility exposes the lawyer to disciplinary sanctions as
provided in Section 27, Rule 138 of the Rules of Court, as amended, viz.:
Section 27. Disbarment or suspension of attorneys by Supreme Court, grounds therefor. A member of the bar may be disbarred or suspended from his
office as attorney by the Supreme Court for any deceit, malpractice, or other gross misconduct in such office, grossly immoral conduct, or by reason of his
conviction of a crime involving moral turpitude, or for any violation of the oath which he is required to take before the admission to practice, or for a wilful
disobedience appearing as an attorney for a party to a case without authority so to do. The practice of soliciting cases at law for the purpose of gain, either
personally or through paid agents or brokers, constitutes malpractice.
The complainants' allegations of the respondents' acts and omissions are insufficient to establish any censurable conduct against them.
Section 10 of Presidential Decree No. 1529 (Property Registration Decree) enumerates the general duties of the Register of Deeds, as follows:
Section 10. General functions of Registers of Deeds. - x x x
178
It shall be the duty of the Register of Deeds to immediately register an instrument presented for registration dealing with real or personal property which
complies with all the requisites for registration. He shall see to it that said instrument bears the proper documentary science stamps and that the same are
properly canceled. If the instrument is not registrable, he shall forthwith deny registration thereof and inform the presenter of such denial in writing, stating the
ground or reason therefor, and advising him of his right to appeal by consulta in accordance with Section 117 of this Decree. (Emphasis supplied)
The aforementioned duty of the Register of Deeds is ministerial in nature.21 A purely ministerial act or duty is one that an officer or tribunal performs in a
given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to or the exercise of his own judgment upon the
propriety or impropriety of the act done. If the law imposes a duty upon a public officer and gives him the right to decide how or when the duty shall be
performed, such duty is discretionary, not ministerial. The duty is ministerial only when its discharge requires neither the exercise of official discretion nor the
exercise of judgment.22
In Gabriel v. Register of Deeds of Rizal,23 the Court underscores that registration is a merely ministerial act of the Register of Deeds, explaining:
xxx [W]hether the document is invalid, frivolous or intended to harass, is not the duty of a Register of Deeds to decide, but a court of competent jurisdiction,
and that it is his concern to see whether the documents sought to be registered conform with the formal and legal requirements for such documents.
In view of the foregoing, we find no abuse of authority or irregularity committed by Atty. Quilala, Atty. Cunanan, and Atty. Caluya, Jr. with respect to the
cancellation of the notice of adverse claim and the notice of lis pendens annotated on TCT No. N-290546. Whether or not the RTC order dated May 16, 2008
or the letter-request dated June 30, 2008 had been falsified, fraudulent or invalid was not for them to determine inasmuch as their duty to examine documents
presented for registration was limited only to what appears on the face of the documents. If, upon their evaluation of the letter-request and the RTC order,
they found the same to be sufficient in law and t]o be in conformity with existing requirements, it became obligatory for them to perform their ministerial duty
without unnecessary delay.24
Should they be aggrieved by said respondents' performance of duty, complainants were not bereft of any remedy because they could challenge the
performance of duty by bringing the matter by way of consulta with the LRA, as provided by Section 11725 of Presidential Decree No. 1529. But, as enunciated
in Gabriel v. Register of Deeds of Rizal,26 it was ultimately within the province of a court of competent jurisdiction to resolve issues concerning the validity or
invalidity of a document registered by the Register of Deeds.
The complainants charge Atty. Victorio, Jr. and Atty. Tolentino, Jr. with having conspired with each other to guarantee that the parties in Civil Case No. Q-
59598 would enter into the amicable settlement, and then to cause the cancellation of the affidavit of adverse claim and notice of lis pendens annotated on
TCT No. N-290546. The complainants further fault Atty. Victorio, Jr. with having abandoned their cause since the issuance of the RTC of its order dated May
16, 2008.
The complainants' charges are devoid of substance.
Although it is not necessary to prove a formal agreement in order to establish conspiracy because conspiracy may be inferred from the circumstances attending
the commission of an act, it is nonetheless essential that conspiracy be established by clear and convincing evidence.27 The complainants failed in this
regard. Outside of their bare assertions that Atty. Victorio, Jr. and Atty. Tolentino, Jr. had conspired with each other in order to cause the dismissal of the
complaint and then discharge of the annotations, they presented no evidence to support their allegation of conspiracy. On the contrary, the records indicated
their own active pjarticipation in arriving at the amicable settlement with the defendants in Civil Case No. Q-07-59598. Hence, they could not now turn their
backs on the amicable settlement that they had themselves entered into.
179
Even assuming that Atty. Victorio, Jr. and Atty. Tolentino, Jr. initiated ahd participated in the settlement of the case, there was nothing wrong in their doing
so. It was actually their obligation as lawyers to do so, pursuant to Rule 1.04, Canon 1 of the Code of Professional Responsibility, viz.:
RULE 1.04 - A lawyer shall encourage his clients to avoid, end or settle a controversy if it will admit of a fair settlement.
In fine, the presumption of the validity of the amicable settlement of the complainants and the defendants in Civil Case No. Q-07-59598 subsisted.28
Anent the complainants' charge of abandonment against Atty. Victorio, Jr., Rule 18.03 and Rule 18.04, Canon 18 of the Code of Professional Responsibility
are applicable, to wit:
CANON 18 - A lawyer shall serve his client with competence and diligence.
Rule 18.03 - A lawyer shall not neglect a legal matter entrusted to him, and his negligence in connection therewith shall render him liable.
Rule 18.04 - A lawyer shall keep the client informed of the status of his case and shall respond within a reasonable time to the client's request for information.
There is no issue that the complainants engaged the services of Atty. Victorio, Jr. as their counsel in Civil Case No. Q-07-59598. Atty. Victorio, Jr. served as
such counsel. With Atty. Victorio, Jr. assistance, the complainants obtained a fair settlement consisting in receiving half of the proceeds of the sale of the
property in litis, without any portion of the proceeds accruing to counsel as his legal fees. The complainants did not competently and persuasively show any
unfaithfulness on the part of Atty. Victorio, Jr. as far as their interest in the litigation was concerned. Hence, Atty. Victorio, Jr. was not liable for abandonment.
Atty. Victorio, Jr. could not be faulted for the perceived inattention to any other matters subsequent to the termination of Civil Case No. Q-07-59598. Unless
otherwise expressly stipulated between them at any time during the engagement, the complainants had no right to assume that Atty. Victorio, Jr.'s legal
representation was indefinite as to extend to his representation of them in the LRA. The Law Profession did not burden its members with the responsibility of
indefinite service to the clients; hence, the rendition of professional services depends on the agreement between the attorney and the client. Atty. Victorio,
Jr.'s alleged failure to respond to the complainants' calls or visits, or to provide them with his whereabouts to enable them to have access to him despite the
termination of his engagement in Civil Case No. Q-07-59598 did not equate to abandonment without the credible showing that he continued to come under
the professional obligation towards them after the termination of Civil Case No. Q-07-59598.cralawred
WHEREFORE, the Court DISMISSES the baseless disbarment complaints against Atty. Federico S. Tolentino, Jr., Atty. Renato G. Cunanan, Atty. Daniel F.
Victorio, Jr., Atty. Elbert T. Quilala and Atty. Constante P. Caluya, Jr.
SO ORDERED
PEOPLE VS BAYOTAS 1994
In Criminal Case No. C-3217 filed before Branch 16, RTC Roxas City, Rogelio Bayotas y Cordova was charged with Rape and eventually convicted thereof
on June 19, 1991 in a decision penned by Judge Manuel E. Autajay. Pending appeal of his conviction, Bayotas died on February 4, 1992 at
the National Bilibid Hospital due to cardio respiratory arrest secondary to hepatic encephalopathy secondary to hipato carcinoma gastric malingering.
Consequently, the Supreme Court in its Resolution of May 20, 1992 dismissed the criminal aspect of the appeal. However, it required the Solicitor General to
file its comment with regard to Bayotas' civil liability arising from his commission of the offense charged.
180
In his comment, the Solicitor General expressed his view that the death of accused-appellant did not extinguish his civil liability as a result of his commission
of the offense charged. The Solicitor General, relying on the case of People v. Sendaydiego 1 insists that the appeal should still be resolved for the purpose
of reviewing his conviction by the lower court on which the civil liability is based.
Counsel for the accused-appellant, on the other hand, opposed the view of the Solicitor General arguing that the death of the accused while judgment of
conviction is pending appeal extinguishes both his criminal and civil penalties. In support of his position, said counsel invoked the ruling of the Court of Appeals
in People v. Castillo and Ocfemia 2 which held that the civil obligation in a criminal case takes root in the criminal liability and, therefore, civil liability is
extinguished if accused should die before final judgment is rendered.
We are thus confronted with a single issue: Does death of the accused pending appeal of his conviction extinguish his civil liability?
In the aforementioned case of People v. Castillo, this issue was settled in the affirmative. This same issue posed therein was phrased thus: Does the death
of Alfredo Castillo affect both his criminal responsibility and his civil liability as a consequence of the alleged crime?
It resolved this issue thru the following disquisition:
Article 89 of the Revised Penal Code is the controlling statute. It reads, in part:
Art. 89. How criminal liability is totally extinguished. Criminal liability is totally extinguished:
1. By the death of the convict, as to the personal penalties; and as to the pecuniary penalties liability therefor is extinguished only when the death of the
offender occurs before final judgment;
With reference to Castillo's criminal liability, there is no question. The law is plain. Statutory construction is unnecessary. Said liability is extinguished.
The civil liability, however, poses a problem. Such liability is extinguished only when the death of the offender occurs before final judgment. Saddled upon us
is the task of ascertaining the legal import of the term "final judgment." Is it final judgment as contradistinguished from an interlocutory order? Or, is it a
judgment which is final and executory?
We go to the genesis of the law. The legal precept contained in Article 89 of the Revised Penal Code heretofore transcribed is lifted from Article 132 of the
Spanish El Codigo Penal de 1870 which, in part, recites:
La responsabilidad penal se extingue.

1. Por la muerte del reo en cuanto a las penas personales siempre, y respecto a las pecuniarias, solo cuando a su fallecimiento no hubiere recaido
sentencia firme.
xxx xxx xxx
The code of 1870 . . . it will be observed employs the term "sentencia firme." What is "sentencia firme" under the old statute?
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XXVIII Enciclopedia Juridica Espaola, p. 473, furnishes the ready answer: It says:
SENTENCIA FIRME. La sentencia que adquiere la fuerza de las definitivas por no haberse utilizado por las partes litigantes recurso alguno contra ella dentro
de los terminos y plazos legales concedidos al efecto.
"Sentencia firme" really should be understood as one which is definite. Because, it is only when judgment is such that, as Medina y Maranon puts it, the crime
is confirmed "en condena determinada;" or, in the words of Groizard, the guilt of the accused becomes "una verdad legal." Prior thereto, should the
accused die, according to Viada, "no hay legalmente, en tal caso, ni reo, ni delito, ni responsabilidad criminal de ninguna clase." And, as Judge Kapunan well
explained, when a defendant dies before judgment becomes executory, "there cannot be any determination by final judgment whether or not the felony upon
which the civil action might arise exists," for the simple reason that "there is no party defendant." (I Kapunan, Revised Penal Code, Annotated, p. 421. Senator
Francisco holds the same view. Francisco, Revised Penal Code, Book One, 2nd ed., pp. 859-860)
The legal import of the term "final judgment" is similarly reflected in the Revised Penal Code. Articles 72 and 78 of that legal body mention the term "final
judgment" in the sense that it is already enforceable. This also brings to mind Section 7, Rule 116 of the Rules of Court which states that a judgment in a
criminal case becomes final "after the lapse of the period for perfecting an appeal or when the sentence has been partially or totally satisfied or served, or the
defendant has expressly waived in writing his right to appeal."
By fair intendment, the legal precepts and opinions here collected funnel down to one positive conclusion: The term final judgment employed in the Revised
Penal Code means judgment beyond recall. Really, as long as a judgment has not become executory, it cannot be truthfully said that defendant is definitely
guilty of the felony charged against him.
Not that the meaning thus given to final judgment is without reason. For where, as in this case, the right to institute a separate civil action is not reserved, the
decision to be rendered must, of necessity, cover "both the criminal and the civil aspects of the case." People vs. Yusico (November 9, 1942), 2 O.G., No.
100, p. 964. See also: People vs. Moll, 68 Phil., 626, 634; Francisco, Criminal Procedure, 1958 ed., Vol. I, pp. 234, 236. Correctly, Judge Kapunan observed
that as "the civil action is based solely on the felony committed and of which the offender might be found guilty, the death of the offender extinguishes the civil
liability." I Kapunan, Revised Penal Code, Annotated, supra.
Here is the situation obtaining in the present case: Castillo's criminal liability is out. His civil liability is sought to be enforced by reason of that criminal liability.
But then, if we dismiss, as we must, the criminal action and let the civil aspect remain, we will be faced with the anomalous situation whereby we will be called
upon to clamp civil liability in a case where the source thereof criminal liability does not exist. And, as was well stated in Bautista, et al. vs. Estrella, et
al., CA-G.R.
No. 19226-R, September 1, 1958, "no party can be found and held criminally liable in a civil suit," which solely would remain if we are to divorce it from the
criminal proceeding."
This ruling of the Court of Appeals in the Castillo case 3 was adopted by the Supreme Court in the cases of People of the Philippines v. Bonifacio Alison, et
al., 4 People of the Philippines v. Jaime Jose, et al. 5 and People of the Philippines v. Satorre 6 by dismissing the appeal in view of the death of the accused
pending appeal of said cases.
As held by then Supreme Court Justice Fernando in the Alison case:
182
The death of accused-appellant Bonifacio Alison having been established, and considering that there is as yet no final judgment in view of the pendency of
the appeal, the criminal and civil liability of the said accused-appellant Alison was extinguished by his death (Art. 89, Revised Penal Code; Reyes' Criminal
Law, 1971 Rev. Ed., p. 717, citing People v. Castillo and Ofemia C.A., 56 O.G. 4045); consequently, the case against him should be dismissed.
On the other hand, this Court in the subsequent cases of Buenaventura Belamala v. Marcelino Polinar 7 and Lamberto Torrijos v. The Honorable Court of
Appeals 8 ruled differently. In the former, the issue decided by this court was: Whether the civil liability of one accused of physical injuries who died before
final judgment is extinguished by his demise to the extent of barring any claim therefore against his estate. It was the contention of the administrator-appellant
therein that the death of the accused prior to final judgment extinguished all criminal and civil liabilities resulting from the offense, in view of Article 89,
paragraph 1 of the Revised Penal Code. However, this court ruled therein:
We see no merit in the plea that the civil liability has been extinguished, in view of the provisions of the Civil Code of the Philippines of 1950 (Rep. Act No.
386) that became operative eighteen years after the revised Penal Code. As pointed out by the Court below, Article 33 of the Civil Code establishes a civil
action for damages on account of physical injuries, entirely separate and distinct from the criminal action.
Art. 33. In cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may be
brought by the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence.
Assuming that for lack of express reservation, Belamala's civil action for damages was to be considered instituted together with the criminal action still, since
both proceedings were terminated without final adjudication, the civil action of the offended party under Article 33 may yet be enforced separately.
In Torrijos, the Supreme Court held that:

xxx xxx xxx
It should be stressed that the extinction of civil liability follows the extinction of the criminal liability under Article 89, only when the civil liability arises from the
criminal act as its only basis. Stated differently, where the civil liability does not exist independently of the criminal responsibility, the extinction of the latter by
death, ipso facto extinguishes the former, provided, of course, that death supervenes before final judgment. The said principle does not apply in instant case
wherein the civil liability springs neither solely nor originally from the crime itself but from a civil contract of purchase and sale. (Emphasis ours)
xxx xxx xxx

In the above case, the court was convinced that the civil liability of the accused who was charged with estafa could likewise trace its genesis to Articles 19,
20 and 21 of the Civil Code since said accused had swindled the first and second vendees of the property subject matter of the contract of sale. It therefore
concluded: "Consequently, while the death of the accused herein extinguished his criminal liability including fine, his civil liability based on the laws of human
relations remains."
Thus it allowed the appeal to proceed with respect to the civil liability of the accused, notwithstanding the extinction of his criminal liability due to his death
pending appeal of his conviction.
183
To further justify its decision to allow the civil liability to survive, the court relied on the following ratiocination: Since Section 21, Rule 3 of the Rules of Court
9 requires the dismissal of all money claims against the defendant whose death occurred prior to the final judgment of the Court of First Instance (CFI), then
it can be inferred that actions for recovery of money may continue to be heard on appeal, when the death of the defendant supervenes after the CFI had
rendered its judgment. In such case, explained this tribunal, "the name of the offended party shall be included in the title of the case as plaintiff-appellee and
the legal representative or the heirs of the deceased-accused should be substituted as defendants-appellants."
It is, thus, evident that as jurisprudence evolved from Castillo to Torrijos, the rule established was that the survival of the civil liability depends on whether the
same can be predicated on sources of obligations other than delict. Stated differently, the claim for civil liability is also extinguished together with the criminal
action if it were solely based thereon, i.e., civil liability ex delicto.
However, the Supreme Court in People v. Sendaydiego, et al. 10 departed from this long-established principle of law. In this case, accused Sendaydiego was
charged with and convicted by the lower court of malversation thru falsification of public documents. Sendaydiego's death supervened during the pendency
of the appeal of his conviction.
This court in an unprecedented move resolved to dismiss Sendaydiego's appeal but only to the extent of his criminal liability. His civil liability was allowed to
survive although it was clear that such claim thereon was exclusively dependent on the criminal action already extinguished. The legal import of such decision
was for the court to continue exercising appellate jurisdiction over the entire appeal, passing upon the correctness of Sendaydiego's conviction despite
dismissal of the criminal action, for the purpose of determining if he is civilly liable. In doing so, this Court issued a Resolution of July 8, 1977 stating thus:
The claim of complainant Province of Pangasinan for the civil liability survived Sendaydiego because his death occurred after final judgment was rendered by
the Court of First Instance of Pangasinan, which convicted him of three complex crimes of malversation through falsification and ordered him to indemnify the
Province in the total sum of P61,048.23 (should be P57,048.23).
The civil action for the civil liability is deemed impliedly instituted with the criminal action in the absence of express waiver or its reservation in a separate
action (Sec. 1, Rule 111 of the Rules of Court). The civil action for the civil liability is separate and distinct from the criminal action (People and Manuel vs.
Coloma, 105 Phil. 1287; Roa vs. De la Cruz, 107 Phil. 8).
When the action is for the recovery of money and the defendant dies before final judgment in the Court of First Instance, it shall be dismissed to be prosecuted
in the manner especially provided in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the Rules of Court).
The implication is that, if the defendant dies after a money judgment had been rendered against him by the Court of First Instance, the action survives him. It
may be continued on appeal (Torrijos vs. Court of Appeals, L-40336, October 24, 1975; 67 SCRA 394).
The accountable public officer may still be civilly liable for the funds improperly disbursed although he has no criminal liability (U.S. vs. Elvina, 24 Phil. 230;
Philippine National Bank vs. Tugab, 66 Phil. 583).
In view of the foregoing, notwithstanding the dismissal of the appeal of the deceased Sendaydiego insofar as his criminal liability is concerned, the Court
Resolved to continue exercising appellate jurisdiction over his possible civil liability for the money claims of the Province of Pangasinan arising from the
184
alleged criminal acts complained of, as if no criminal case had been instituted against him, thus making applicable, in determining his civil liability, Article 30
of the Civil Code . . . and, for that purpose, his counsel is directed to inform this Court within ten (10) days of the names and addresses of the decedent's heirs
or whether or not his estate is under administration and has a duly appointed judicial administrator. Said heirs or administrator will be substituted for the
deceased insofar as the civil action for the civil liability is concerned (Secs. 16 and 17, Rule 3, Rules of Court).
Succeeding cases 11 raising the identical issue have maintained adherence to our ruling in Sendaydiego; in other words, they were a reaffirmance of our
abandonment of the settled rule that a civil liability solely anchored on the criminal (civil liability ex delicto) is extinguished upon dismissal of the entire appeal
due to the demise of the accused.
But was it judicious to have abandoned this old ruling? A re-examination of our decision in Sendaydiego impels us to revert to the old ruling.
To restate our resolution of July 8, 1977 in Sendaydiego: The resolution of the civil action impliedly instituted in the criminal action can proceed irrespective
of the latter's extinction due to death of the accused pending appeal of his conviction, pursuant to Article 30 of the Civil Code and Section 21, Rule 3 of the
Revised Rules of Court.
Article 30 of the Civil Code provides:
When a separate civil action is brought to demand civil liability arising from a criminal offense, and no criminal proceedings are instituted during the pendency
of the civil case, a preponderance of evidence shall likewise be sufficient to prove the act complained of.
Clearly, the text of Article 30 could not possibly lend support to the ruling in Sendaydiego. Nowhere in its text is there a grant of authority to continue exercising
appellate jurisdiction over the accused's civil liability ex delicto when his death supervenes during appeal. What Article 30 recognizes is an alternative and
separate civil action which may be brought to demand civil liability arising from a criminal offense independently of any criminal action. In the event that no
criminal proceedings are instituted during the pendency of said civil case, the quantum of evidence needed to prove the criminal act will have to be that which
is compatible with civil liability and that is, preponderance of evidence and not proof of guilt beyond reasonable doubt. Citing or invoking Article 30 to justify
the survival of the civil action despite extinction of the criminal would in effect merely beg the question of whether civil liability ex delicto survives upon extinction
of the criminal action due to death of the accused during appeal of his conviction. This is because whether asserted in
the criminal action or in a separate civil action, civil liability ex delicto is extinguished by the death of the accused while his conviction is on appeal. Article 89
of the Revised Penal Code is clear on this matter:
Art. 89. How criminal liability is totally extinguished. Criminal liability is totally extinguished:
1. By the death of the convict, as to the personal penalties; and as to pecuniary penalties, liability therefor is extinguished only when the death of the
xxx xxx xxx

However, the ruling in Sendaydiego deviated from the expressed intent of Article 89. It allowed claims for civil liability ex delicto to survive by ipso facto treating
the civil action impliedly instituted with the criminal, as one filed under Article 30, as though no criminal proceedings had been filed but merely a separate civil
action. This had the effect of converting such claims from one which is dependent on the outcome of the criminal action to an entirely new and separate one,
the prosecution of which does not even necessitate the filing of criminal proceedings. 12 One would be hard put to pinpoint the statutory authority for such a
185
transformation. It is to be borne in mind that in recovering civil liability ex delicto, the same has perforce to be determined in the criminal action, rooted as it is
in the court's pronouncement of the guilt or innocence of the accused. This is but to render fealty to the intendment of Article 100 of the Revised Penal Code
which provides that "every person criminally liable for a felony is also civilly liable." In such cases, extinction of the criminal action due to death of the accused
pending appeal inevitably signifies the concomitant extinction of the civil liability. Mors Omnia Solvi. Death dissolves all things.
In sum, in pursuing recovery of civil liability arising from crime, the final determination of the criminal liability is a condition precedent to the prosecution of the
civil action, such that when the criminal action is extinguished by the demise of accused-appellant pending appeal thereof, said civil action cannot survive.
The claim for civil liability springs out of and is dependent upon facts which, if true, would constitute a crime. Such civil liability is an inevitable consequence
of the criminal liability and is to be declared and enforced in the criminal proceeding. This is to be distinguished from that which is contemplated under Article
30 of the Civil Code which refers to the institution of a separate civil action that does not draw its life from a criminal proceeding. The Sendaydiego resolution
of July 8, 1977, however, failed to take note of this fundamental distinction when it allowed the survival of the civil action for the recovery of civil liability ex
delicto by treating the same as a separate civil action referred to under Article 30. Surely, it will take more than just a summary judicial pronouncement to
authorize the conversion of said civil action to an independent one such as that contemplated under Article 30.
Ironically however, the main decision in Sendaydiego did not apply Article 30, the resolution of July 8, 1977 notwithstanding. Thus, it was held in the main
decision:
Sendaydiego's appeal will be resolved only for the purpose of showing his criminal liability which is the basis of the civil liability for which his estate would be
liable. 13
In other words, the Court, in resolving the issue of his civil liability, concomitantly made a determination on whether Sendaydiego, on the basis of evidenced
adduced, was indeed guilty beyond reasonable doubt of committing the offense charged. Thus, it upheld Sendaydiego's conviction and pronounced the same
as the source of his civil liability. Consequently, although Article 30 was not applied in the final determination of Sendaydiego's civil liability, there was a
reopening of the criminal action already extinguished which served as basis for Sendaydiego's civil liability. We reiterate: Upon death of the accused pending
appeal of his conviction, the criminal action is extinguished inasmuch as there is no longer a defendant to stand as the accused; the civil action instituted
therein for recovery of civil liability ex delicto is ipso facto extinguished, grounded as it is on the criminal.
Section 21, Rule 3 of the Rules of Court was also invoked to serve as another basis for the Sendaydiego resolution of July 8, 1977. In citing Sec. 21, Rule 3
of the Rules of Court, the Court made the inference that civil actions of the type involved in Sendaydiego consist of money claims, the recovery of which may
be continued on appeal if defendant dies pending appeal of his conviction by holding his estate liable therefor. Hence, the Court's conclusion:
"When the action is for the recovery of money" "and the defendant dies before final judgment in the court of First Instance, it shall be dismissed to be
prosecuted in the manner especially provided" in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the Rules of Court).
The implication is that, if the defendant dies after a money judgment had been rendered against him by the Court of First Instance, the action survives him. It
may be continued on appeal.
186
Sadly, reliance on this provision of law is misplaced. From the standpoint of procedural law, this course taken in Sendaydiego cannot be sanctioned. As
correctly observed by Justice Regalado:
xxx xxx xxx

I do not, however, agree with the justification advanced in both Torrijos and Sendaydiego which, relying on the provisions of Section 21, Rule 3 of the Rules
of Court, drew the strained implication therefrom that where the civil liability instituted together with the criminal liabilities had already passed beyond the
judgment of the then Court of First Instance (now the Regional Trial Court), the Court of Appeals can continue to exercise appellate jurisdiction thereover
despite the extinguishment of the component criminal liability of the deceased. This pronouncement, which has been followed in the Court's judgments
subsequent and consonant to Torrijos and Sendaydiego, should be set aside and abandoned as being clearly erroneous and unjustifiable.
Said Section 21 of Rule 3 is a rule of civil procedure in ordinary civil actions. There is neither authority nor justification for its application in criminal procedure
to civil actions instituted together with and as part of criminal actions. Nor is there any authority in law for the summary conversion from the latter category of
an ordinary civil action upon the death of the offender. . . .
Moreover, the civil action impliedly instituted in a criminal proceeding for recovery of civil liability ex delicto can hardly be categorized as an ordinary money
claim such as that referred to in Sec. 21, Rule 3 enforceable before the estate of the deceased accused.
Ordinary money claims referred to in Section 21, Rule 3 must be viewed in light of the provisions of Section 5, Rule 86 involving claims against the estate,
which in Sendaydiego was held liable for Sendaydiego's civil liability. "What are contemplated in Section 21 of Rule 3, in relation to Section 5 of Rule 86, 14
are contractual money claims while the claims involved in civil liability ex delicto may include even the restitution of personal or real property." 15 Section 5,
Rule 86 provides an exclusive enumeration of what claims may be filed against the estate. These are: funeral expenses, expenses for the last illness,
judgments for money and claim arising from contracts, expressed or implied. It is clear that money claims arising from delict do not form part of this exclusive
enumeration. Hence, there could be no legal basis in (1) treating a civil action ex delicto as an ordinary contractual money claim referred to in Section 21,
Rule 3 of the Rules of Court and (2) allowing it to survive by filing a claim therefor before the estate of the deceased accused. Rather, it should be extinguished
upon extinction of the criminal action engendered by the death of the accused pending finality of his conviction.
Accordingly, we rule: if the private offended party, upon extinction of the civil liability ex delicto desires to recover damages from the same act or omission
complained of, he must subject to Section 1, Rule 111 16 (1985 Rules on Criminal Procedure as amended) file a separate civil action, this time predicated
not on the felony previously charged but on other sources of obligation. The source of obligation upon which the separate civil action is premised determines
against whom the same shall be enforced.
If the same act or omission complained of also arises from quasi-delict or may, by provision of law, result in an injury to person or property (real or personal),
the separate civil action must be filed against the executor or administrator 17 of the estate of the accused pursuant to Sec. 1, Rule 87 of the Rules of Court:
Sec. 1. Actions which may and which may not be brought against executor or administrator. No action upon a claim for the recovery of money or
debt or interest thereon shall be commenced against the executor or administrator; but actions to recover real or personal property, or an interest therein,
from the estate, or to enforce a lien thereon, and actions to recover damages for an injury to person or property, real or personal, may be commenced against
him.
187
This is in consonance with our ruling in Belamala 18 where we held that, in recovering damages for injury to persons thru an independent civil action based
on Article 33 of the Civil Code, the same must be filed against the executor or administrator of the estate of deceased accused and not against the estate
under Sec. 5, Rule 86 because this rule explicitly limits the claim to those for funeral expenses, expenses for the last sickness of the decedent, judgment for
money and claims arising from contract, express or implied. Contractual money claims, we stressed, refers only to purely personal obligations other than
those which have their source in delict or tort.
Conversely, if the same act or omission complained of also arises from contract, the separate civil action must be filed against the estate of the accused,
pursuant to Sec. 5, Rule 86 of the Rules of Court.
From this lengthy disquisition, we summarize our ruling herein:
1. Death of the accused pending appeal of his conviction extinguishes his criminal liability as well as the civil liability based solely thereon. As opined by
Justice Regalado, in this regard, "the death of the accused prior to final judgment terminates his criminal liability and only the civil liability directly arising from
and based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore."
2. Corollarily, the claim for civil liability survives notwithstanding the death of accused, if the same may also be predicated on a source of obligation other
than delict. 19 Article 1157 of the Civil Code enumerates these other sources of obligation from which the civil liability may arise as a result of the same act
or omission:
a) Law 20
b) Contracts
c) Quasi-contracts
d) ...
e) Quasi-delicts
3. Where the civil liability survives, as explained in Number 2 above, an action for recovery therefor may be pursued but only by way of filing a separate
civil action and subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended. This separate civil action may be enforced either against
the executor/administrator or the estate of the accused, depending on the source of obligation upon which the same is based as explained above.
4. Finally, the private offended party need not fear a forfeiture of his right to file this separate civil action by prescription, in cases where during the
prosecution of the criminal action and prior to its extinction, the private-offended party instituted together therewith the civil action. In such case, the statute of
limitations on the civil liability is deemed interrupted during the pendency of the criminal case, conformably with provisions of Article 1155 21 of the Civil Code,
that should thereby avoid any apprehension on a possible privation of right by prescription. 22
Applying this set of rules to the case at bench, we hold that the death of appellant Bayotas extinguished his criminal liability and the civil liability based solely
on the act complained of, i.e., rape. Consequently, the appeal is hereby dismissed without qualification.
WHEREFORE, the appeal of the late Rogelio Bayotas is DISMISSED with costs de oficio.
188
SO ORDERED.
FRIAS VS SAN DIEGO- SISON 2007
Before us is a Petition for Review on Certiorari filed by Bobie Rose V. Frias represented by her Attorney-in-fact, Marie Regine F. Fujita (petitioner) seeking to
annul the Decision[1] dated June 18, 2002 and the Resolution[2] dated September 11, 2002 of the Court of Appeals (CA) in CA-G.R. CV No. 52839.
Petitioner is the owner of a house and lot located at No. 589 Batangas East, Ayala Alabang, Muntinlupa, Metro Manila, which she acquired from Island Masters
Realty and Development Corporation (IMRDC) by virtue of a Deed of Sale dated Nov. 16, 1990.[3] The property is covered by TCT No. 168173 of the Register
of Deeds of Makati in the name of IMRDC.[4]
On December 7, 1990, petitioner, as the FIRST PARTY, and Dra. Flora San Diego-Sison (respondent), as the SECOND PARTY, entered into a Memorandum
of Agreement[5] over the property with the following terms:
NOW, THEREFORE, for and in consideration of the sum of THREE MILLION PESOS (P3,000,000.00) receipt of which is hereby acknowledged by the FIRST
PARTY from the SECOND PARTY, the parties have agreed as follows:
1. That the SECOND PARTY has a period of Six (6) months from the date of the execution of this contract within which to notify the FIRST PARTY of her
intention to purchase the aforementioned parcel of land together within (sic) the improvements thereon at the price of SIX MILLION FOUR HUNDRED
THOUSAND PESOS (P6,400,000.00). Upon notice to the FIRST PARTY of the SECOND PARTYs intention to purchase the same, the latter has a period of
another six months within which to pay the remaining balance of P3.4 million.
2. That prior to the six months period given to the SECOND PARTY within which to decide whether or not to purchase the above-mentioned property, the
FIRST PARTY may still offer the said property to other persons who may be interested to buy the same provided that the amount of P3,000,000.00 given to
the FIRST PARTY BY THE SECOND PARTY shall be paid to the latter including interest based on prevailing compounded bank interest plus the amount of
the sale in excess of P7,000,000.00 should the property be sold at a price more than P7 million.
3. That in case the FIRST PARTY has no other buyer within the first six months from the execution of this contract, no interest shall be charged by the
SECOND PARTY on the P3 million however, in the event that on the sixth month the SECOND PARTY would decide not to purchase the aforementioned
property, the FIRST PARTY has a period of another six months within which to pay the sum of P3 million pesos provided that the said amount shall earn
compounded bank interest for the last six months only. Under this circumstance, the amount of P3 million given by the SECOND PARTY shall be treated as
[a] loan and the property shall be considered as the security for the mortgage which can be enforced in accordance with law.
Petitioner received from respondent two million pesos in cash and one million pesos in a post-dated check dated February 28, 1990, instead of 1991, which
rendered said check stale.[7] Petitioner then gave respondent TCT No. 168173 in the name of IMRDC and the Deed of Absolute Sale over the property
between petitioner and IMRDC.
189
Respondent decided not to purchase the property and notified petitioner through a letter[8] dated March 20, 1991, which petitioner received only on June 11,
1991,[9] reminding petitioner of their agreement that the amount of two million pesos which petitioner received from respondent should be considered as a
loan payable within six months. Petitioner subsequently failed to pay respondent the amount of two million pesos.
On April 1, 1993, respondent filed with the Regional Trial Court (RTC) of Manila, a complaint[10] for sum of money with preliminary attachment against
petitioner. The case was docketed as Civil Case No. 93-65367 and raffled to Branch 30. Respondent alleged the foregoing facts and in addition thereto
averred that petitioner tried to deprive her of the security for the loan by making a false report[11] of the loss of her owners copy of TCT No. 168173 to the
Tagig Police Station on June 3, 1991, executing an affidavit of loss and by filing a petition[12] for the issuance of a new owners duplicate copy of said title
with the RTC of Makati, Branch 142; that the petition was granted in an Order[13] dated August 31, 1991; that said Order was subsequently set aside in an
Order dated April 10, 1992[14] where the RTC Makati granted respondents petition for relief from judgment due to the fact that respondent is in possession
of the owners duplicate copy of TCT No. 168173, and ordered the provincial public prosecutor to conduct an investigation of petitioner for perjury and false
testimony. Respondent prayed for the ex-parte issuance of a writ of preliminary attachment and payment of two million pesos with interest at 36% per annum
from December 7, 1991, P100,000.00 moral, corrective and exemplary damages and P200,000.00 for attorneys fees.
In an Order dated April 6, 1993, the Executive Judge of the RTC of Manila issued a writ of preliminary attachment upon the filing of a bond in the amount of
two million pesos.[15]
Petitioner filed an Amended Answer[16] alleging that the Memorandum of Agreement was conceived and arranged by her lawyer, Atty. Carmelita Lozada,
who is also respondents lawyer; that she was asked to sign the agreement without being given the chance to read the same; that the title to the property and
the Deed of Sale between her and the IMRDC were entrusted to Atty. Lozada for safekeeping and were never turned over to respondent as there was no
consummated sale yet; that out of the two million pesos cash paid, Atty. Lozada took the one million pesos which has not been returned, thus petitioner had
filed a civil case against her; that she was never informed of respondents decision not to purchase the property within the six month period fixed in the
agreement; that when she demanded the return of TCT No. 168173 and the Deed of Sale between her and the IMRDC from Atty. Lozada, the latter gave her
these documents in a brown envelope on May 5, 1991 which her secretary placed in her attache case; that the envelope together with her other personal
things were lost when her car was forcibly opened the following day; that she sought the help of Atty. Lozada who advised her to secure a police report, to
execute an affidavit of loss and to get the services of another lawyer to file a petition for the issuance of an owners duplicate copy; that the petition for the
issuance of a new owners duplicate copy was filed on her behalf without her knowledge and neither did she sign the petition nor testify in court as falsely
claimed for she was abroad; that she was a victim of the manipulations of Atty. Lozada and respondent as shown by the filing of criminal charges for perjury
and false testimony against her; that no interest could be due as there was no valid mortgage over the property as the principal obligation is vitiated with fraud
and deception. She prayed for the dismissal of the complaint, counter-claim for damages and attorneys fees.
Trial on the merits ensued. On January 31, 1996, the RTC issued a decision,[17] the dispositive portion of which reads:
WHEREFORE, judgment is hereby RENDERED:
1) Ordering defendant to pay plaintiff the sum of P2 Million plus interest thereon at the rate of thirty two (32%) per cent per annum beginning December 7,
1991 until fully paid.
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2) Ordering defendant to pay plaintiff the sum of P70,000.00 representing premiums paid by plaintiff on the attachment bond with legal interest thereon
counted from the date of this decision until fully paid.
3) Ordering defendant to pay plaintiff the sum of P100,000.00 by way of moral, corrective and exemplary damages.
4) Ordering defendant to pay plaintiff attorneys fees of P100,000.00 plus cost of litigation.
The RTC found that petitioner was under obligation to pay respondent the amount of two million pesos with compounded interest pursuant to their
Memorandum of Agreement; that the fraudulent scheme employed by petitioner to deprive respondent of her only security to her loaned money when petitioner
executed an affidavit of loss and instituted a petition for the issuance of an owners duplicate title knowing the same was in respondents possession, entitled
respondent to moral damages; and that petitioners bare denial cannot be accorded credence because her testimony and that of her witness did not appear
to be credible.
The RTC further found that petitioner admitted that she received from respondent the two million pesos in cash but the fact that petitioner gave the one million
pesos to Atty. Lozada was without respondents knowledge thus it is not binding on respondent; that respondent had also proven that in 1993, she initially
paid the sum of P30,000.00 as premium for the issuance of the attachment bond, P20,000.00 for its renewal in 1994, and P20,000.00 for the renewal in 1995,
thus plaintiff should be reimbursed considering that she was compelled to go to court and ask for a writ of preliminary attachment to protect her rights under
the agreement.
Petitioner filed her appeal with the CA. In a Decision dated June 18, 2002, the CA affirmed the RTC decision with modification, the dispositive portion of which
reads:
WHEREFORE, premises considered, the decision appealed from is MODIFIED in the sense that the rate of interest is reduced from 32% to 25% per annum,
effective June 7, 1991 until fully paid.[19]
The CA found that: petitioner gave the one million pesos to Atty. Lozada partly as her commission and partly as a loan; respondent did not replace the
mistakenly dated check of one million pesos because she had decided not to buy the property and petitioner knew of her decision as early as April 1991; the
award of moral damages was warranted since even granting petitioner had no hand in the filing of the petition for the issuance of an owners copy, she
executed an affidavit of loss of TCT No. 168173 when she knew all along that said title was in respondents possession; petitioners claim that she thought the
title was lost when the brown envelope given to her by Atty. Lozada was stolen from her car was hollow; that such deceitful conduct caused respondent
serious anxiety and emotional distress.
The CA concluded that there was no basis for petitioner to say that the interest should be charged for six months only and no more; that a loan always bears
interest otherwise it is not a loan; that interest should commence on June 7, 1991[20] with compounded bank interest prevailing at the time the two million
was considered as a loan which was in June 1991; that the bank interest rate for loans secured by a real estate mortgage in 1991 ranged from 25% to 32%
per annum as certified to by Prudential Bank,[21] that in fairness to petitioner, the rate to be charged should be 25% only.
Petitioners motion for reconsideration was denied by the CA in a Resolution dated September 11, 2002.
Hence the instant Petition for Review on Certiorari filed by petitioner raising the following issues:
191
(A) WHETHER OR NOT THE COMPOUNDED BANK INTEREST SHOULD BE LIMITED TO SIX (6) MONTHS AS CONTAINED IN THE MEMORANDUM
OF AGREEMENT.
(B) WHETHER OR NOT THE RESPONDENT IS ENTITLED TO MORAL DAMAGES.
(C) WHETHER OR NOT THE GRANT OF CORRECTIVE AND EXEMPLARY DAMAGES AND ATTORNEYS FEES IS PROPER EVEN IF NOT
MENTIONED IN THE TEXT OF THE DECISION.
Petitioner contends that the interest, whether at 32% per annum awarded by the trial court or at 25% per annum as modified by the CA which should run from
June 7, 1991 until fully paid, is contrary to the parties Memorandum of Agreement; that the agreement provides that if respondent would decide not to purchase
the property, petitioner has the period of another six months to pay the loan with compounded bank interest for the last six months only; that the CAs ruling
that a loan always bears interest otherwise it is not a loan is contrary to Art. 1956 of the New Civil Code which provides that no interest shall be due unless it
has been expressly stipulated in writing.
We are not persuaded.
While the CAs conclusion, that a loan always bears interest otherwise it is not a loan, is flawed since a simple loan may be gratuitous or with a stipulation to
pay interest,[23] we find no error committed by the CA in awarding a 25% interest per annum on the two-million peso loan even beyond the second six months
stipulated period.
The Memorandum of Agreement executed between the petitioner and respondent on December 7, 1990 is the law between the parties. In resolving an issue
based upon a contract, we must first examine the contract itself, especially the provisions thereof which are relevant to the controversy.[24] The general rule
is that if the terms of an agreement are clear and leave no doubt as to the intention of the contracting parties, the literal meaning of its stipulations shall
prevail.[25] It is further required that the various stipulations of a contract shall be interpreted together, attributing to the doubtful ones that sense which may
result from all of them taken jointly.[26]
In this case, the phrase for the last six months only should be taken in the context of the entire agreement. We agree with and adopt the CAs interpretation of
the phrase in this wise:
Their agreement speaks of two (2) periods of six months each. The first six-month period was given to plaintiff-appellee (respondent) to make up her mind
whether or not to purchase defendant-appellants (petitioner's) property. The second six-month period was given to defendant-appellant to pay the P2 million
loan in the event that plaintiff-appellee decided not to buy the subject property in which case interest will be charged for the last six months only, referring to
the second six-month period. This means that no interest will be charged for the first six-month period while appellee was making up her mind whether to buy
the property, but only for the second period of six months after appellee had decided not to buy the property. This is the meaning of the phrase for the last six
months only. Certainly, there is nothing in their agreement that suggests that interest will be charged for six months only even if it takes defendant-appellant
an eternity to pay the loan.[27]
The agreement that the amount given shall bear compounded bank interest for the last six months only, i.e., referring to the second six-month period, does
not mean that interest will no longer be charged after the second six-month period since such stipulation was made on the logical and reasonable expectation
192
that such amount would be paid within the date stipulated. Considering that petitioner failed to pay the amount given which under the Memorandum of
Agreement shall be considered as a loan, the monetary interest for the last six months continued to accrue until actual payment of the loaned amount.
The payment of regular interest constitutes the price or cost of the use of money and thus, until the principal sum due is returned to the creditor, regular
interest continues to accrue since the debtor continues to use such principal amount.[28] It has been held that for a debtor to continue in possession of the
principal of the loan and to continue to use the same after maturity of the loan without payment of the monetary interest, would constitute unjust enrichment
on the part of the debtor at the expense of the creditor.[29]
Petitioner and respondent stipulated that the loaned amount shall earn compounded bank interests, and per the certification issued by Prudential Bank, the
interest rate for loans in 1991 ranged from 25% to 32% per annum. The CA reduced the interest rate to 25% instead of the 32% awarded by the trial court
which petitioner no longer assailed.
In Bautista v. Pilar Development Corp.,[30] we upheld the validity of a 21% per annum interest on a P142,326.43 loan. In Garcia v. Court of Appeals,[31] we
sustained the agreement of the parties to a 24% per annum interest on an P8,649,250.00 loan. Thus, the interest rate of 25% per annum awarded by the CA
to a P2 million loan is fair and reasonable.
Petitioner next claims that moral damages were awarded on the erroneous finding that she used a fraudulent scheme to deprive respondent of her security
for the loan; that such finding is baseless since petitioner was acquitted in the case for perjury and false testimony filed by respondent against her.
Article 31 of the Civil Code provides that when the civil action is based on an obligation not arising from the act or omission complained of as a felony, such
civil action may proceed independently of the criminal proceedings and regardless of the result of the latter.[32]
While petitioner was acquitted in the false testimony and perjury cases filed by respondent against her, those actions are entirely distinct from the collection
of sum of money with damages filed by respondent against petitioner.
We agree with the findings of the trial court and the CA that petitioners act of trying to deprive respondent of the security of her loan by executing an affidavit
of loss of the title and instituting a petition for the issuance of a new owners duplicate copy of TCT No. 168173 entitles respondent to moral damages. Moral
damages may be awarded in culpa contractual or breach of contract cases when the defendant acted fraudulently or in bad faith. Bad faith does not simply
connote bad judgment or negligence; it imports a dishonest purpose or some moral obliquity and conscious doing of wrong. It partakes of the nature of
fraud.[33]
The Memorandum of Agreement provides that in the event that respondent opts not to buy the property, the money given by respondent to petitioner shall be
treated as a loan and the property shall be considered as the security for the mortgage. It was testified to by respondent that after they executed the agreement
on December 7, 1990, petitioner gave her the owners copy of the title to the property, the Deed of Sale between petitioner and IMRDC, the certificate of
occupancy, and the certificate of the Secretary of the IMRDC who signed the Deed of Sale.[34] However, notwithstanding that all those documents were in
respondents possession, petitioner executed an affidavit of loss that the owners copy of the title and the Deed of Sale were lost.
193
Although petitioner testified that her execution of the affidavit of loss was due to the fact that she was of the belief that since she had demanded from Atty.
Lozada the return of the title, she thought that the brown envelope with markings which Atty. Lozada gave her on May 5, 1991 already contained the title and
the Deed of Sale as those documents were in the same brown envelope which she gave to Atty. Lozada prior to the transaction with respondent.[35] Such
statement remained a bare statement. It was not proven at all since Atty. Lozada had not taken the stand to corroborate her claim. In fact, even petitioners
own witness, Benilda Ynfante (Ynfante), was not able to establish petitioner's claim that the title was returned by Atty. Lozada in view of Ynfante's testimony
that after the brown envelope was given to petitioner, the latter passed it on to her and she placed it in petitioners attach case[36] and did not bother to look
at the envelope.[37]
It is clear therefrom that petitioners execution of the affidavit of loss became the basis of the filing of the petition with the RTC for the issuance of new owners
duplicate copy of TCT No. 168173. Petitioners actuation would have deprived respondent of the security for her loan were it not for respondents timely filing
of a petition for relief whereby the RTC set aside its previous order granting the issuance of new title. Thus, the award of moral damages is in order.
The entitlement to moral damages having been established, the award of exemplary damages is proper.[38] Exemplary damages may be imposed upon
petitioner by way of example or correction for the public good.[39] The RTC awarded the amount of P100,000.00 as moral and exemplary damages. While
the award of moral and exemplary damages in an aggregate amount may not be the usual way of awarding said damages,[40] no error has been committed
by CA. There is no question that respondent is entitled to moral and exemplary damages.
Petitioner argues that the CA erred in awarding attorneys fees because the trial courts decision did not explain the findings of facts and law to justify the award
of attorneys fees as the same was mentioned only in the dispositive portion of the RTC decision.
We agree.
Article 2208[41] of the New Civil Code enumerates the instances where such may be awarded and, in all cases, it must be reasonable, just and equitable if
the same were to be granted.[42] Attorney's fees as part of damages are not meant to enrich the winning party at the expense of the losing litigant. They are
not awarded every time a party prevails in a suit because of the policy that no premium should be placed on the right to litigate.[43] The award of attorney's
fees is the exception rather than the general rule. As such, it is necessary for the trial court to make findings of facts and law that would bring the case within
the exception and justify the grant of such award. The matter of attorney's fees cannot be mentioned only in the dispositive portion of the decision.[44] They
must be clearly explained and justified by the trial court in the body of its decision. On appeal, the CA is precluded from supplementing the bases for awarding
attorneys fees when the trial court failed to discuss in its Decision the reasons for awarding the same. Consequently, the award of attorney's fees should be
deleted.
WHEREFORE, in view of all the foregoing, the Decision dated June 18, 2002 and the Resolution dated September 11, 2002 of the Court of Appeals in CA-
G.R. CV No. 52839 are AFFIRMED with MODIFICATION that the award of attorneys fees is DELETED.
SO ORDERED.
DALURAYA VS OLIVA 2014
194
Assailed in this petition for review on certiorari1 are the Decision2 dated June 28, 2013 and the Resolution3 dated November 22, 2013 rendered by the Court
of Appeals (CA) in CA-G.R. SP No. 125113 finding petitioner Antonio L. Daluraya (Daluraya) civilly liable for the death of Marina Arabit Oliva (Marina Oliva)
despite having been acquitted for Reckless Imprudence Resulting in Homicide on the ground of insufficiency of evidence.
The Facts
On January 4, 2006, Daluraya was charged in an Information4 for Reckless Imprudence Resulting in Homicide in connection with the death5 of Marina Oliva.
Records reveal that sometime in the afternoon of January 3, 2006, Marina Oliva was crossing the street when a Nissan Vanette, bearing plate number UPN-
172 and traversing EDSA near the Quezon Avenue flyover in Quezon City, ran her over.6 While Marina Oliva was rushed to the hospital to receive medical
attention,she eventually died, prompting her daughter, herein respondent Marla Oliva (Marla), to file a criminal case for Reckless Imprudence Resulting in
Homicide against Daluraya, the purported driver of the vehicle.7
During the proceedings, the prosecution presented as witness Shem Serrano (Serrano), an eye-witness to the incident, who testified that on said date, he
saw a woman crossing EDSA heading towards the island near the flyover and that the latter was bumped by a Nissan Vanette bearing plate number UPN-
172. The prosecution also offered the testimonies of (a) Marla, who testified as to the civil damages sustained by her family as a result of her mothers death;
(b) Dr. Paul Ortiz (Dr. Ortiz), who presented his findings on the autopsy conducted upon the body of Marina Oliva; and (c) Police Senior Inspector Lauro
Gomez (PSI Gomez), who conducted the investigation following the incident and claimed that Marina Oliva was hit by the vehicle being driven by Daluraya,
albeit he did not witness the incident.
After the prosecution rested its case, Daluraya filed an Urgent Motion to Dismiss (demurrer)9 asserting, inter alia, that he was not positively identified by any
of the prosecution witnesses as the driver of the vehicle that hit the victim, and that there was no clear and competent evidence of how the incident transpired.10
The MeTC Ruling
In an Order11 dated May 24, 2010, the Metropolitan Trial Court of Quezon City, Branch 38 (MeTC) granted Dalurayas demurrer and dismissed the case for
insufficiency of evidence. It found that the testimonies of the prosecution witnesses were wanting in material details and that they failed to sufficiently establish
that Daluraya committed the crime imputed upon him.12 Deconstructing the testimonies of the prosecution witnesses individually, the MeTC found that: (a)
Marla merely testified on the damages sustained by her family but she failed to identify Daluraya as the driver of the vehicle that hit her mother; (b) Serrano
also did not identify
Daluraya as the driver of the said vehicle; (c) Dr. Ortiz merely testified on the autopsy results; and (d) PSI Gomez, while he did investigate the incident,
likewise declared thathe did not witness the same.13
Marla moved for reconsideration,14 which the MeTC denied in an Order15 dated November 4, 2010, clarifying that the grant of Dalurayas demurrer had the
effect of an acquittal and that reconsideration of its Order granting Dalurayas demurrer would violate the latters right against double jeopardy.16 With respect
to the civil aspect of the case, the MeTC likewise denied the same, holding that no civil liability can be awarded absent any evidence proving that Daluraya
was the person responsible for Marina Olivas demise.17
195
Aggrieved, Marla appealed18 to the Regional Trial Court of Quezon City, Branch 76 (RTC), insisting that the MeTC failed to make any finding as to the civil
liability of Daluraya,19 which finding was not precluded by the dismissal of the criminal aspect of the case.
The RTC Ruling
In a Decision20 dated September 8, 2011, the RTC dismissed the appeal and affirmed the MeTCs ruling,declaring that "the act from which the criminal
responsibility may spring did not at all exist."21
Marla filed a motion for reconsideration22 which, although filed beyond the reglementary period, was nonetheless accepted. However, the RTC found the
same without merit and thus, sustained the factual findings and rulings of the MeTC in its Order23 dated May 10, 2012. Dissatisfied, Marla elevated the case
to the CA via petition for review, maintaining that Daluraya must be held civilly liable.
The CA Ruling
In a Decision24 dated June 28, 2013, the CA granted the petition and reversed the RTC Decision, ordering Daluraya to pay Marla the amounts of P152,547.00
as actual damages, P50,000.00 as civil indemnity, and P50,000.00 as moral damages.25 In so ruling, the CA held that the MeTCs Order showed that
Dalurayas acquittal was based on the fact that the prosecution failed to prove his guilt beyond reasonable doubt. As such, Daluraya was not exonerated from
civil liability.26
Moreover, the CA considered the following pieces of evidence to support its finding that Daluraya must be held civilly liable: (a) the inadmissible sworn
statement executed by Daluraya where he admitted that he drove the subject vehicle which hit Marina Oliva; (b) the conclusion derived from Serranos
testimony that the woman he saw crossing the street who was hit by a Nissan Vanette with plate number UPN-172, and the victim who eventually died, are
one and the same; (c) the Philippine National Police Referral Letter of one Police Chief Inspector Virgilio Pereda identifying Daluraya as the suspectin the
case of Reckless Imprudence Resulting in Homicide involving the death of Marina Oliva, and stating that he brought the victim to the Quezon City General
Hospital for treatment but was declared dead on arrival; and (d) the subject vehicle was registered in the name of Dalurayas aunt, Gloria Zilmar,27 who
authorized him to claim the vehicle from the MeTC.28
Daluraya filed a motion for reconsideration,29 which the CA denied in a Resolution30 dated November 22, 2013,hence, this petition.
The Issue Before the Court
The sole issue advanced for the Courts resolution is whether or not the CA was correct in finding Daluraya civilly liable for Marina Olivas death despite his
acquittal in the criminal case for Reckless Imprudence Resulting in Homicide on the ground of insufficiency of evidence.
The Courts Ruling
The petition is meritorious.
196
Every person criminally liable for a felony is also civilly liable. The acquittal of an accused of the crime charged, however, does not necessarily extinguish his
civil liability.31 In Manantan v. CA,32 the Court expounded on the two kinds of acquittal recognized by our law and their concomitant effects on the civil liability
of the accused, as follows:
Our law recognizes two kinds of acquittal, with different effects on the civil liability of the accused. First is an acquittal on the ground that the accused is not
the author of the actor omission complained of. This instance closes the door to civil liability, for a person who has been found to be not the perpetrator of any
act or omission cannot and can never be held liable for such act or omission. There being no delict, civil liability ex delictois out of the question, and the civil
action, if any, which may be instituted must be based on grounds other than the delict complained of. This is the situation contemplated inRule 111 of the
Rules of Court. The second instance is an acquittal based on reasonable doubt on the guilt of the accused. In this case, even if the guilt of the accused has
not been satisfactorily established, he is not exempt from civil liability which may be proved by preponderance of evidence only.33
In Dayap v. Sendiong,34 the Court explained further:
The acquittal of the accused does not automatically preclude a judgment against him on the civil aspect of the case.1wphi1 The extinction of the penal action
does not carry with it the extinction of the civil liability where: (a) the acquittal is based on reasonable doubt as only preponderance of evidence is required;
(b) the court declares that the liability of the accused is only civil; and (c) the civil liability of the accused does not arise from or is not based upon the crime of
which the accused is acquitted. However, the civil action based on delictmay be deemed extinguished if there is a finding on the final judgment in the criminal
action that the act or omission from which the civil liability may arise did not exist or where the accused did not commit the acts or omission imputed to him.
Thus, if demurrer is granted and the accused is acquitted by the court, the accused has the right to adduce evidence on the civil aspect of the case unless
the court also declares that the act or omission from which the civil liability may arise did not exist. This is because when the accused files a demurrer to
evidence, he has not yet adduced evidence both on the criminal and civil aspects of the case. The only evidence on record is the evidence for the prosecution.
What the trial court should do is issue an order or partial judgment granting the demurrer to evidence and acquitting the accused, and set the case for
continuation of trial for the accused to adduce evidence on the civil aspect of the case and for the private complainant to adduce evidence by way of rebuttal.
Thereafter, the court shall render judgment on the civil aspect of the case.
In case of an acquittal, the Rules of Court requires that the judgment state "whether the evidence of the prosecution absolutely failed to prove the guilt of the
accused or merely failed to prove his guilt beyond reasonable doubt. In either case, the judgment shall determine if the act or omission from which the civil
liability might arise did not exist."36
A punctilious examination of the MeTCs Order, which the RTC sustained, will show that Dalurayas acquittal was based on the conclusion that the act or
omission from which the civil liability may arise did not exist, given that the prosecution was not able to establish that he was the author of the crime imputed
against him. Such conclusion is clear and categorical when the MeTC declared that "the testimonies of the prosecution witnesses are wanting in material
details and they did not sufficiently establish that the accused precisely committed the crime charged against him."37 Furthermore, when Marla sought
reconsideration of the MeTCs Order acquitting Daluraya, said court reiterated and firmly clarified that "the prosecution was not able to establish that the
accused was the driver of the Nissan Vanette which bumped Marina Oliva"38 and that "there is no competent evidence on hand which proves that the accused
was the person responsible for the death of Marina Oliva."39
197
Clearly, therefore, the CA erred in construing the findings of the MeTC, as affirmed by the RTC, that Dalurayas acquittal was anchored on reasonable doubt,
which would necessarily call for a remand of the case to the court a quo for the reception of Dalurayas evidence on the civil aspect.1wphi1 Records disclose
that Dalurayas acquittal was based on the fact that "the act or omission from which the civil liability may arise did not exist" in view of the failure of the
prosecution to sufficiently establish that he was the author of the crime ascribed against him. Consequently, his civil liability should be deemed as non-existent
by the nature of such acquittal.
WHEREFORE, the petition is GRANTED. The Decision dated June 28, 2013 and the Resolution dated November 22, 2013 of the Court of Appeals in CA-
G.R. SP No. 125113 are hereby REVERSED and SET ASIDE. The Decision dated September 8,2011 and the Order dated May 10, 2012 of the Regional
Trial Court of Quezon City, Branch 76 are REINSTATED.
SO ORDERED.
PEOPLE VS DIONALDO 2014
Before the Court is an appeal assailing the Decision1 dated February 15, 2013 of the Court of Appeals (CA) in CA-G.R. CR-H.C. No. 02888 finding accused-
appellants Armando Dionaldo y Ebron (Armando), Renato Dionaldo y Ebron (Renato), Mariano Gariguez, Jr. y Ramos (Mariano), and Rodolfo Larido y Ebron
(Rodolfo) guilty beyond reasonable doubt of the crime of Kidnapping and Serious Illegal Detention.
The Facts
At around 8 o'clock in the morning of May 16, 2003, Roderick Navarro (Roderick) dropped his brother Edwin Navarro (Edwin) off at the Health Is Wealth Gym
in Caloocan City. Thirty minutes later, he received a text message from another brother who told him that Edwin had been kidnapped.2 Records show that
three (3) men, later identified as Armando, Renato, and Mariano, forcibly dragged a bloodied Edwin down the stairway of the gym and pushed him inside a
dark green Toyota car with plate number UKF 194.3 Upon receiving the message, Roderick immediately reported the incident to the police. At around 10
oclock in the morning of the same day, he received a phone call from Edwins kidnappers who threatened to kill Edwin if he should report the matter to the
police.4
The following day, Roderick received another call from the kidnappers, who demanded the payment of ransom money in the amount of P15,000,000.00.
Roderick told them he had no such money, as he only had P50,000.00. On May 19, 2003, after negotiations over the telephone, the kidnappers agreed to
release Edwin in exchange for the amount of P110,000.00. Roderick was then instructed to bring the money to Batangas and wait for their next call.5
At around 7:30 in the evening of the same day, as Roderick was on his way to Batangas to deliver the ransom money, the kidnappers called and instructed
him to open all the windows of the car he was driving and to turn on the hazard light when he reaches the designated place. After a while, Roderick received
another call directing him to exit in Bicutan instead and proceed to C-5 until he arrives at the Centennial Village. He was told to park beside the Libingan ng
mga Bayani. After several hours, an orange Mitsubishi car with plate number DEH 498 pulled up in front of his vehicle where four (4) men alighted. Roderick
saw one of the men take a mobile phone and upon uttering the word "alat," the men returned to their car and drove away.6
198
Meanwhile, a team had been organized to investigate the kidnapping of Edwin, headed by SPO3 Romeo Caballero (SPO3 Caballero) and PO3 Nestor
Acebuche (PO3 Acebuche) of the Camp Crame Police Anti-Crime Emergency Response (PACER). During the course of the investigation, Rodolfo, an
employee at the Health Is Wealth Gym, confessed to PO3 Acebuche that he was part of the plan to kidnap Edwin, as in fact he was the one who tipped off
Mariano, Renato, Armando and a certain Virgilio7 Varona8 (Virgilio) on the condition that he will be given a share in the ransom money. Rodolfo gave
information on the whereabouts of his cohorts, leading to their arrest on June 12, 2003. In the early morning of the following day or on June 13, 2003, the
PACER team found the dead body of Edwin at Sitio Pugpugan Laurel, Batangas, which Roderick identified.9
Thus, accused-appellants as well as Virgilio were charged in an Information10 which reads:
That on or about the 16th day of May, 2003 in Caloocan City, Metro Manila and within the jurisdiction of this Honorable Court, the above-named accused,
conspiring together and mutually helping one another, being then private persons, did then and there by force and intimidation willfully, unlawfully and
feloniously with the use of motor vehicle and superior strength take, carry and deprive EDWIN NAVARRO Y ONA, of his liberty against his will, for the purpose
of extorting ransom as in fact a demand of P15,000,000.00 was made as a condition of the victims release and on the occasion thereof, the death of the
victim resulted.
Contrary to law.
During arraignment, accused-appellants pleaded not guilty11 and interposed the defenses of denial and alibi. Except for Rodolfo, they individually claimed
that on said date and time, they were in their respective houses when they were taken by men in police uniforms, then subsequently brought to Camp Crame,
and there allegedly tortured and detained. On the other hand, Rodolfo, for himself, averred that at around 8 oclock in the evening of June 12, 2003, while
walking on his way home, he noticed that a van had been following him. Suddenly, four (4) persons alighted from the vehicle, boarded him inside, blindfolded
him, and eventually tortured him. He likewise claimed that he was made to sign an extrajudicial confession, purporting too that while a certain Atty.
Nepomuceno had been summoned to assist him, the latter failed to do so.12
During trial, the death of the victim, Edwin, was established through a Certificate of Death13 with Registry No. 2003-050 (subject certificate of death) showing
that he died on May 19, 2003 from a gunshot wound on the head.
The RTC Ruling
In a Decision14 dated June 13, 2007, the Regional Trial Court of Caloocan City, Branch 129 (RTC), in Crim. Case No. C-68329, convicted accused-appellants
of the crime of Kidnapping and Serious Illegal Detention, sentencing each of them to suffer the penalty of reclusion perpetua.
It gave credence to the positive and straightforward testimonies of the prosecution witnesses which clearly established that it was the accusedappellants who
forcibly dragged a bloodied Edwin into a car and, consequently, deprived him of his liberty.15 In light thereof, it rejected accused-appellants respective alibis
and claims of torture, which were not substantiated. It also held that the crime of Kidnapping had been committed for the purpose of extorting ransom, which
is punishable by death. However, in view of the suspended imposition of the death penalty pursuant to Republic Act No. (RA) 9346,16 only the penalty of
reclusion perpetua was imposed.17 Further, the RTC found that conspiracy attended the commission of the crime, as the accused-appellants individual
participation was geared toward a joint purpose and criminal design.18
199
Notably, while the RTC found that the testimonies of the prosecution witnesses prove that the victim Edwin was abducted, deprived of liberty, and eventually
killed,19 a fact which is supported by the subject certificate of death, it did not consider said death in its judgment. The CA Ruling
In a Decision20 dated February 15, 2013, the CA affirmed in toto the RTCs conviction of accused-appellants, finding that the prosecution was able to clearly
establish all the elements of the crime of Kidnapping and Serious Illegal Detention, namely: (a) the offender is a private individual; (b) he kidnaps or detains
another, or in any manner deprives the latter of his liberty; (c) the act of detention or kidnapping must be illegal; and (d) in the commission of the offense, any
of the following circumstances is present: (1) the kidnapping or detention lasts for more than three days; (2) it is committed simulating public authority; (3) any
serious physical injuries are inflicted upon the person kidnapped or detained or threats to kill him are made; or (4) the person kidnapped or detained is a
minor, except when the accused is any of the parents, female or a public officer.21 It likewise sustained the finding that the kidnapping was committed for the
purpose of extorting ransom, as sufficiently proven by the testimony of the brother of the victim.22 Moreover, the CA affirmed that conspiracy attended the
commission of the crime, as the acts of accused-appellants emanated from the same purpose or common design, and they were united in its execution.23
Separately, the CA found that accused-appellants claims of torture were never supported, and that Rodolfo voluntarily signed the extrajudicial confession
and was afforded competent and independent counsel in its execution.24
Aggrieved by their conviction, accused-appellants filed the instant appeal.
The Issue Before the Court
The sole issue to be resolved by the Court is whether or not accusedappellants are guilty of the crime of Kidnapping and Serious Illegal Detention.
The Courts Ruling
The appeal is devoid of merit.
Well-settled is the rule that the question of credibility of witnesses is primarily for the trial court to determine. Its assessment of the credibility of a witness is
entitled to great weight, and it is conclusive and binding unless shown to be tainted with arbitrariness or unless, through oversight, some fact or circumstance
of weight and influence has not been considered. Absent any showing that the trial judge overlooked, misunderstood, or misapplied some facts or
circumstances of weight which would affect the result of the case, or that the judge acted arbitrarily, his assessment of the credibility of witnesses deserves
high respect by the appellate court.25
In this case, the RTC, as affirmed by the CA, gave weight and credence to the testimonies of the prosecution witnesses, which they found to be straightforward
and consistent. Through these testimonies, it was clearly established that accused-appellants, who were all private individuals, took the victim Edwin and
deprived him of his liberty, which acts were illegal, and for the purpose of extorting ransom.26 Thus, seeing no semblance of arbitrariness or misapprehension
on the part of the court a quo, the Court finds no compelling reason to disturb its factual findings on this score.1wphi1
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Anent the finding that conspiracy attended the commission of the crime, the Court likewise finds the conclusion of the RTC in this regard, as affirmed by the
CA, to be well-taken. Conspiracy exists when two or more persons come to an agreement concerning the commission of a felony and decide to commit it,
and when conspiracy is established, the responsibility of the conspirators is collective, not individual, rendering all of them equally liable regardless of the
extent of their respective participations.27 In this relation, direct proof is not essential to establish conspiracy, as it can be presumed from and proven by the
acts of the accused pointing to a joint purpose, design, concerted action, and community of interests.28 Hence, as the factual circumstances in this case
clearly show that accused-appellants acted in concert at the time of the commission of the crime and that their acts emanated from the same purpose or
common design, showing unity in its execution,29 the CA, affirming the trial court, correctly ruled that there was conspiracy among them.
The foregoing notwithstanding, the Court is, however, constrained to modify the ruling of the RTC and the CA, as the crime the accusedappellants have
committed does not, as the records obviously bear, merely constitute Kidnapping and Serious Illegal Detention, but that of the special complex crime of
Kidnapping for Ransom with Homicide. This is in view of the victims (i.e., Edwins) death, which was (a) specifically charged in the Information,30 and (b)
clearly established during the trial of this case. Notably, while this matter was not among the issues raised before the Court, the same should nonetheless be
considered in accordance with the settled rule that in a criminal case, an appeal, as in this case, throws open the entire case wide open for review, and the
appellate court can correct errors, though unassigned, that may be found in the appealed judgment.31
After the amendment of the Revised Penal Code on December 31, 1993 by RA 7659, Article 267 of the same Code now provides:
Art. 267. Kidnapping and serious illegal detention. Any private individual who shall kidnap or detain another, or in any other manner deprive him of his liberty,
shall suffer the penalty of reclusion perpetua to death:
1. If the kidnapping or detention shall have lasted more than three days.
2. If it shall have been committed simulating public authority.
3. If any serious physical injuries shall have been inflicted upon the person kidnapped or detained; or if threats to kill him shall have been made.
4. If the person kidnapped or detained shall be a minor, except when the accused is any of the parents, female or a public officer;
The penalty shall be death where the kidnapping or detention was committed for the purpose of extorting ransom from the victim or any other person, even if
none of the circumstances above-mentioned were present in the commission of the offense.
When the victim is killed or dies as a consequence of the detention or is raped, or is subjected to torture or dehumanizing acts, the maximum penalty shall be
imposed. (Emphases supplied)
The Court further elucidated in People v. Mercado:32
In People v. Ramos, the accused was found guilty of two separate heinous crimes of kidnapping for ransom and murder committed on July 13, 1994 and
sentenced to death. On appeal, this Court modified the ruling and found the accused guilty of the "special complex crime" of kidnapping for ransom with
murder under the last paragraph of Article 267, as amended by Republic Act No. 7659. This Court said:
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x x x This amendment introduced in our criminal statutes the concept of special complex crime of kidnapping with murder or homicide. It effectively eliminated
the distinction drawn by the courts between those cases where the killing of the kidnapped victim was purposely sought by the accused, and those where the
killing of the victim was not deliberately resorted to but was merely an afterthought. Consequently, the rule now is: Where the person kidnapped is killed in
the course of the detention, regardless of whether the killing was purposely sought or was merely an afterthought, the kidnapping and murder or homicide
can no longer be complexed under Art. 48, nor be treated as separate crimes, but shall be punished as a special complex crime under the last paragraph of
Art. 267, as amended by RA No. 7659.33 (Emphases supplied; citations omitted)
Thus, further taking into account the fact that the kidnapping was committed for the purpose of extorting ransom, accused-appellants conviction must be
modified from Kidnapping and Serious Illegal Detention to the special complex crime of Kidnapping for Ransom with Homicide, which carries the penalty of
death. As earlier intimated, the enactment of RA 9346 had suspended the imposition of the death penalty. This means that the accused-appellants could, as
the CA and trial court properly ruled, only be sentenced to the penalty of reclusion perpetua. To this, the Court adds that the accused-appellants are not
eligible for parole.34
On a final note, the Court observes that the RTC and the CA failed to award civil indemnity as well as damages to the family of the kidnap victim. In People
v. Quiachon,35 the Court explained that even if the death penalty was not to be imposed on accused-appellants in view of the prohibition in RA 9346, the
award of civil indemnity was nonetheless proper, not being dependent on the actual imposition of the death penalty but on the fact that qualifying circumstances
warranting the imposition of the death penalty attended the commission of the crime.36 In the present case, considering that both the qualifying circumstances
of ransom and the death of the victim during captivity were duly alleged in the information and proven during trial, civil indemnity in the amount of P100,000.00
must therefore be awarded to the family of the victim, to conform with prevailing jurisprudence.37
Similarly, the Court finds that the award of moral damages is warranted in this case. Under Article 2217 of the Civil Code, moral damages include physical
suffering, mental anguish, fright, serious anxiety, wounded feelings, moral shock and similar injury, while Article 2219 of the same Code provides that moral
damages may be recovered in cases of illegal detention. It cannot be denied, in this case, that the kidnap victims family suffered mental anguish, fright, and
serious anxiety over the detention and eventually, the death of Edwin. As such, and in accordance with prevailing jurisprudence,38 moral damages in the
amount of P100,000.00 must perforce be awarded to the family of the victim.
Finally, exemplary damages must be awarded in this case, in view of the confluence of the aforesaid qualifying circumstances and in order to deter others
from committing the same atrocious acts. In accordance with prevailing jurisprudence,39 therefore, the Court awards exemplary damages in the amount of
P100,000.00 to the family of the kidnap victim.
In addition, interest at the rate of six percent (6%) per annum shall be imposed on all damages awarded from the date of finality of judgment until fully paid,
pursuant to prevailing jurisprudence.40
WHEREFORE, the appeal is DISMISSED. The Decision dated February 15, 2013 of the Court of Appeals in CA-G.R. CR-H.C. No. 02888 is hereby AFFIRMED
with the MODIFICATION that all the accusedappellants herein are equally found GUILTY of the special complex crime of Kidnapping for Ransom with
Homicide, and are sentenced to each suffer the penalty of reclusion perpetua, without eligibility for parole, and to pay, jointly and severally, the family of the
kidnap victim Edwin Navarro the following amounts: (1) P100,000.00 as civil indemnity; (2) P100,000.00 as moral damages; and (3) P100,000.00 as exemplary
damages, all with interest at the rate of six percent (6%) per annum from the date of finality of judgment until fully paid.
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SO ORDERED.
TUANDA VS SANDIGANBAYAN 1995
Petitioners institute this special civil action for certiorari and prohibition under Rule 65 of the Revised Rules of Court to set aside the resolution of the
Sandiganbayan dated 17 February 1992 and its orders dated 19 August 1992 and 13 May 1993 in Criminal Case No. 16936 entitled "People of the Philippines
versus Reynaldo Tuanda, et al." denying petitioners' motion for suspension of their arraignment.
The present controversy arose from the following antecedents:
On 9 February 1989, private respondents Delia Estrellanes and Bartolome Binaohan were designated as industrial labor sectoral representative and
agricultural labor sectoral representative respectively, for the Sangguniang Bayan of Jimalalud, Province of Negros Oriental by then Secretary Luis T. Santos
of the Department of Local Government. Private respondents Binaohan and Estrellanes took their oath of office on 16 February 1989 and 17 February 1989,
respectively.
Subsequently, petitioners filed an undated petition with the Office of the President for review and recall of said designations. The latter, however, in a letter
dated 20 March 1989, denied the petition and enjoined Mayor Reynaldo Tuanda to recognize private respondents as sectoral representatives.
On 4 May 1990, private respondents filed a petition for mandamus with the Regional Trial Court of Negros Oriental, Branch 35, docketed as Special Civil
Action No. 9661, for recognition as members of the Sangguniang Bayan. It was dismissed on 23 July 1991.
Thereafter, on 20 June 1991, petitioners filed an action with the Regional Trial Court of Dumaguete City to declare null and void the designations of private
respondents as sectoral representatives, docketed as Civil Case No. 9955 entitled "Reynaldo Tuanda, et al. versus Secretary of the Department of Local
Government, et al."
On 21 July 1991, an information was filed before the Sandiganbayan, docketed as Criminal Case No. 16936 entitled "People of the Philippines versus
Reynaldo Tuanda, et al." charging petitioners thus:
INFORMATION
The undersigned Special Prosecution Officer of the Special Prosecutor, hereby accuses REYNALDO V. TUANDA, HERMENEGILDO G. FABURADA,
MANUEL LIM, NICANOR P. AGOSTO, ERENIETA K. MENDOZA, MAXIMO VIERNES, HACUBINA V. SERILLO, and SANTOS A. VILLANUEVA of Violation
of Section 3(e) of R.A. No. 3019, as amended, committed as follows:
That during the period from February 1989 to February 1991 and subsequent thereto, in the Municipality of Jimalalud, Negros Oriental, and within the
jurisdiction of this Honorable Court, accused, all public officers, Mayor REYNALDO V. TUANDA, Vice-Mayor HERMENEGILDO G. FABURADA, Sangguniang
Members MANUEL LIM, NICANOR P. AGOSTO, ERENIETA K. MENDOZA, MAXIMO A. VIERNES, HACUBINA V. SERILLO, ILUMINADO D.
ESTRELLANES and SANTOS A. VILLANUEVA while in the performance of their official functions and taking advantage of their public positions, with evident
203
bad faith, manifest partiality, and conspiring and confederating with each other did, then and there, wilfully and unlawfully cause undue injury to Sectoral
Members Bartolome M. Binaohan and Delia T. Estrellanes by refusing to pay despite demand the amount of NINETY FIVE THOUSAND THREE HUNDRED
FIFTY PESOS (P95,350.00) and ONE HUNDRED EIGHT THOUSAND NINE HUNDRED PESOS (P108,900.00) representing respectively their per diems,
salaries and other privileges and benefits, and such undue injury continuing to the present to the prejudice and damage of Bartolome Binaohan and Delia
Estrellanes.
CONTRARY TO LAW. 1
On 9 September 1991, petitioners filed a motion with the Sandiganbayan for suspension of the proceedings in Criminal Case No. 16936 on the ground that a
prejudicial question exists in Civil Case No. 9955 pending before the Regional Trial Court of Dumaguete City. 2
On 16 January 1992, the Regional Trial Court rendered a decision declaring null and void ab initio the designations issued by the Department of Local
Government to the private respondents as sectoral representatives for having been done in violation of Section 146 (2) of B.P. Blg. 337, otherwise known as
the Local Government Code. 3
The trial court expounded thus:
The Supreme Court in the case of Johnny D. Supangan Jr. v. Luis T. Santos, et al., G.R. No. 84663, along with 7 companion cases of similar import, (G.R.
Nos. 05012, 87601, 87602, 87792, 87935, 88072, and 90205) all promulgated on August 24, 1990, ruled that:
B.P. Blg. 337 explicitly required that before the President (or the Secretary of the Department of Local Government) may appoint members of the local
legislative bodies to represent the Industrial and Agricultural Labor Sectors, there must be a determination to be made by the Sanggunian itself that the said
sectors are of sufficient number in the city or municipality to warrant representation after consultation with associations and persons belonging to the sector
concerned.
The Supreme Court further ruled
For that matter, the Implementing Rules and Regulations of the Local Government Code even prescribe the time and manner by which such determination is
to be conducted by the Sanggunian.
Consequently, in cases where the Sanggunian concerned has not yet determined that the Industrial and Agricultural Labor Sectors in their particular city or
municipality are of sufficient number to warrant representation, there will absolutely be no basis for the designation/appointments.
In the process of such inquiry as to the sufficiency in number of the sector concerned to warrant representation, the Sanggunian is enjoined by law (B.P. Blg.
337) to consult with associations and persons belonging to the sector concerned. Consultation with the sector concerned is made a pre-requisite. This is so
considering that those who belong to the said sector are the ones primarily interested in being represented in the Sanggunian. In the same aforecited case,
the Supreme Court considers such prior determination by the Sanggunian itself (not by any other person or body) as a condition sine qua non to a valid
appointment or designation.
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Since in the present case, there was total absence of the required prior determination by the Sangguniang Bayan of Jimalalud, this Court cannot help but
declare the designations of private defendants as sectoral representatives null and void.
This verdict is not without precedence. In several similar cases, the Supreme Court invariably nullified the designations where the requirements of Sec. 146
(2), B.P. Blg. 337 were not complied with. Just to cite one case, the Supreme Court ruled:
There is no certification from the Sangguniang Bayan of Valenzuela that the sectors concerned are of sufficient number to warrant representation and there
was no consultation whatsoever with the associations and persons belonging to the Industrial and Agricultural Labor Sectors. Therefore, the appointment of
private respondents Romeo F. Bularan and Rafael Cortez are null and void (Romeo Llanado, et al. v. Hon. Luis Santos, et al., G.R. No. 86394, August 24,
1990). 4
Private respondents appealed the aforestated decision to the Court of Appeals, docketed as CA-G.R. CV No. 36769, where the same is currently pending
resolution.
Meanwhile, on 17 February 1992, respondent Sandiganbayan issued a resolution denying the motion for suspension of proceedings filed by petitioners. Said
respondent Sandiganbayan:
Despite the pendency of Civil Case No. 9955 of the Regional Trial Court of Negros Oriental, it appears, nevertheless, that the private complainants have been
rendering services on the basis of their respective appointments as sectoral members of the Sangguniang Bayan of the Municipality of Jimalalud, Negros
Oriental; and that their said appointments enjoy the presumption of regularity. Having rendered such services, the private complainants are entitled to the
salaries attached to their office. Even assuming arguendo that the said Regional Trial Court shall later decide that the said appointments of the private
complainants are null and void, still the private complainants are entitled to their salaries and compensation for service they have actually rendered, for the
reason that before such judicial declaration of nullity, the private complainants are considered at least de facto public officers acting as such on the basis of
apparently valid appointments issued by competent authorities. In other words, regardless of the decision that may be rendered in Civil Case
No. 9955, the private complainants are entitled to their withheld salaries for the services they have actually rendered as sectoral representatives of the said
Sangguniang Bayan. Hence, the decision that may be rendered by the Regional Trial Court in Civil Case No. 9955 would not be determinative of the innocence
or guilt of the accused.
WHEREFORE, the subject Petition for the Suspension of Proceedings in Virtue of Prejudicial Question filed by the accused through counsel, is hereby
DENIED for lack of merit.
SO ORDERED. 5
Petitioners filed a motion for reconsideration of the aforementioned resolution in view of the decision promulgated by the trial court nullifying the appointments
of private respondents but it was, likewise, denied in an order issued by respondent Sandiganbayan on 19 August 1992 on the justification that the grounds
stated in the said motion were a mere rehash of petitioners' original motion to hold the case in abeyance. 6 The dispositive portion of its order reads as follows:
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WHEREFORE, in view of the foregoing, the arraignment of the accused which was scheduled today is cancelled. Mayor Reynaldo Tuanda, Hermenegildo
Faburada, Nicanor P. Agosto, Erenieta K. Mendoza, Hacubina V. Serillo and Iluminado Estrellanes are, however, hereby ordered to show cause in writing
within ten (10) days from service hereof why they should not be cited for contempt of court for their failure to appear in court today for arraignment.
In case of an adverse resolution on the motion to quash which is to be filed by the counsel for the defense, set this case for arraignment, pre-trial and trial on
January 4 & 5, 1993, on all dates the trial to start at 8:30 o'clock in the morning.
SO ORDERED. 7
On 19 February 1993, respondent Sandiganbayan issued an order holding consideration of all incidents pending the issuance of an extended resolution. 8
No such resolution, however, was issued and in its assailed order dated 13 May 1992, respondent Sandiganbayan set the arraignment of petitioners on 30
June 1993. The dispositive portion of the order reads:
WHEREFORE, considering the absence of the accused from the scheduled hearing today which We deem to be excusable, reset this case for arraignment
on June 30, 1993 and for trial on the merits on June 30 and July 1 and 2, 1993, on all dates the trial to start at 8:30 o'clock in the morning.
Give proper notice to the accused and principal counsel, Atty. Alfonso Briones. Considering that the accused come all the way from Himalalud, Negros
Oriental, no postponement will be allowed.
SO ORDERED. 9
Hence, this special civil action for certiorari and prohibition where petitioners attribute to respondent Sandiganbayan the following errors:
A. The Respondent Court committed grave abuse of discretion in denying petitioners' motions for the suspension of the proceedings in Criminal Case No.
16936 in spite of the pendency of a prejudicial issue before the Court of Appeals in CA-G.R. CV No. 36769;
B. The Respondent Court acted without or in excess of jurisdiction in refusing to suspend the proceedings that would entail a retrial and rehearing by it of
the basic issue involved, i.e., the validity of the appointments of private respondents and their entitlement to compensation which is already pending resolution
by the Court of Appeals in C.A. G.R. CV No. 36769; and
C. The Respondent Court committed grave abuse of discretion and/or acted without or in excess of jurisdiction in effectively allowing petitioners to be
prosecuted under two alternative theories that private respondents are de jure and/or de facto officers in violation of petitioners' right to due process. 10
In sum, the only issue in the case at bench is whether or not the legality or validity of private respondents' designation as sectoral representatives which is
pending resolution in CA-G.R. No. 36769 is a prejudicial question justifying suspension of the proceedings in the criminal case against petitioners.
A prejudicial question is one that must be decided before any criminal prosecution may be instituted or before it may proceed (see Art. 36, Civil Code) because
a decision on that point is vital to the eventual judgment in the criminal case. Thus, the resolution of the prejudicial question is a logical antecedent of the
issues involved in said criminal case. 11
206
A prejudicial question is defined as that which arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance
of which pertains to another tribunal. The prejudicial question must be determinative of the case before the court but the jurisdiction to try and resolve the
question must be lodged in another court or tribunal. 12 It is a question based on a fact distinct and separate from "the crime but so intimately connected with
it that it determines the guilt or innocence of the accused, and for it to suspend the criminal action, it must appear not only that said case involves facts
intimately related to those upon which the criminal prosecution would be based but also that in the resolution of the issue or issues raised in the civil case,
the guilt or innocence of the accused would necessarily be determined. It comes into play generally in a situation where a civil action and a criminal action
are both pending and there exists in the former an issue which must be preemptively resolved before the criminal action may proceed, because howsoever
the issue raised in the civil action is resolved would be determinative juris et de jure of the guilt or innocence of the accused in the criminal case." 13
The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. 14 It has two essential elements:
(a) the civil action involves an issue similar or intimately related to the issue raised in the criminal action; and
(b) the resolution of such issue determines whether or not the criminal action may proceed. 15
Applying the foregoing principles to the case at bench, we find that the issue in the civil case, CA-G.R. CV No. 36769, constitutes a valid prejudicial question
to warrant suspension of the arraignment and further proceedings in the criminal case against petitioners.
All the elements of a prejudicial question are clearly and unmistakably present in this case. There is no doubt that the facts and issues involved in the civil
action (No. 36769) and the criminal case (No. 16936) are closely related. The filing of the criminal case was premised on petitioners' alleged partiality and
evident bad faith in not paying private respondents' salaries and per diems as sectoral representatives, while the civil action was instituted precisely to resolve
whether or not the designations of private respondents as sectoral representatives were made in accordance with law.
More importantly, ,the resolution of the civil case will certainly determine if there will still be any reason to proceed with the criminal action.
Petitioners were criminally charged under the Anti-Graft & Corrupt Practices Act (RA 3019, sec, 3[e]) due to their refusal, allegedly in bad faith and with
manifest partiality, to pay private respondents' salaries as sectoral representatives. This refusal, however, was anchored on petitioners' assertion that said
designations were made in violation of the Local Government Code (B.P. Blg. 337) and thus, were null and void. Therefore, should the Court of Appeals
uphold the trial court's decision declaring null and void private respondents' designations as sectoral representatives for failure to comply with the provisions
of the Local Government Code (B.P. Blg. 337, sec. 146[2]), the charges against petitioners would no longer, so to speak, have a leg to stand on. Petitioners
cannot be accused of bad faith and partiality there being in the first place no obligation on their part to pay private respondents' claims. Private respondents
do not have any legal right to demand salaries, per diems and other benefits. In other words, the Court of Appeals' resolution of the issues raised in the civil
action will ultimately determine whether or not there is basis to proceed with the criminal case.
Private respondents insist that even if their designations are nullified, they are entitled to compensation for actual services rendered. 16 We disagree. As
found by the trial court and as borne out by the records, from the start, private respondents' designations as sectoral representatives have been challenged
by petitioners. They began with a petition filed with the Office of the President copies of which were received by private respondents on 26 February 1989,
207
barely eight (8) days after they took their oath of office. 17 Hence, private respondents' claim that they have actually rendered services as sectoral
representatives has not been established.
Finally, we find unmeritorious respondent Sandiganbayan's thesis that even in the event that private respondents' designations are finally declared invalid,
they may still be considered de facto public officers entitled to compensation for services actually rendered.
The conditions and elements of de facto officership are the following:

1) There must be a de jure office;
2) There must be color of right or general acquiescence by the public; and
3) There must be actual physical possession of the office in good faith. 18
One can qualify as a de facto officer only if all the aforestated elements are present. There can be no de facto officer where there is no de jure office, although
there may be a de facto officer in a de jure office. 19
WHEREFORE, the resolution dated 17 February 1992 and orders dated 19 August 1992 and 13 May 1993 of respondent Sandiganbayan in Criminal Case
No. 16936 are hereby SET ASIDE. Respondent Sandiganbayan is enjoined from proceeding with the arraignment and trial of petitioners in Criminal Case No.
16936 pending final resolution of CA-G.R. CV No. 36769.
SO ORDERED.
BELTRAN VS PEOPLE 2000
This petition for review, filed under Rule 45 of the 1997 Rules of Civil Procedure, seeks to review and set aside the Order dated January 28, 1999 issued by
Judge Florentino A. Tuazon, Jr. of the Regional Trial Court of Makati City, Branch 139 in Special Civil Case No. 98-3056, entitled "Meynardo Beltran vs.
People of the Philippines and Hon. Judge Alden Cervantes of the Metropolitan Trial Court of Makati city, Branch 61." The said Order denied petitioners prayer
for the issuance of a writ of preliminary injunction to enjoin Judge Cervantes from proceeding with the trial of Criminal Case No. 236176, a concubinage case
against petitioner on the ground that the pending petition for declaration of nullity of marriage filed by petitioner against his wife constitutes a prejudicial
question.
The antecedent facts of the case are undisputed:
Petitioner Meynardo Beltran and wife Charmaine E. Felix were married on June 16, 1973 at the Immaculate Concepcion Parish Church in Cubao, Quezon
City.[1]
On February 7, 1997, after twenty-four years of marriage and four children,[2] petitioner filed a petition for nullity of marriage on the ground of psychological
incapacity under Article 36 of the Family Code before Branch 87 of the Regional Trial Court of Quezon City. The case was docketed as Civil Case No. Q-97-
30192.[3]
208
In her Answer to the said petition, petitioner's wife Charmaine Felix alleged that it was petitioner who abandoned the conjugal home and lived with a certain
woman named Milagros Salting.[4] Charmaine subsequently filed a criminal complaint for concubinage[5] under Article 334 of the Revised Penal Code against
petitioner and his paramour before the City Prosecutor's Office of Makati who, in a Resolution dated September 16, 1997, found probable cause and ordered
the filing of an Information[6] against them. The case, docketed as Criminal Case No. 236176, was filed before the Metropolitan Trial Court of Makati City,
Branch 61.
On March 20, 1998, petitioner, in order to forestall the issuance of a warrant for his arrest, filed a Motion to Defer Proceedings Including the Issuance of the
Warrant of Arrest in the criminal case. Petitioner argued that the pendency of the civil case for declaration of nullity of his marriage posed a prejudicial question
to the determination of the criminal case. Judge Alden Vasquez Cervantes denied the foregoing motion in the Order[7] dated August 31, 1998. Petitioner's
motion for reconsideration of the said Order of denial was likewise denied in an Order dated December 9, 1998.
In view of the denial of his motion to defer the proceedings in the concubinage case, petitioner went to the Regional Trial Court of Makati City, Branch 139 on
certiorari, questioning the Orders dated August 31, 1998 and December 9, 1998 issued by Judge Cervantes and praying for the issuance of a writ of preliminary
injunction.[8] In an Order[9] dated January 28, 1999, the Regional Trial Court of Makati denied the petition for certiorari. Said Court subsequently issued
another Order[10] dated February 23, 1999, denying his motion for reconsideration of the dismissal of his petition.
Undaunted, petitioner filed the instant petition for review.
Petitioner contends that the pendency of the petition for declaration of nullity of his marriage based on psychological incapacity under Article 36 of the Family
Code is a prejudicial question that should merit the suspension of the criminal case for concubinage filed against him by his wife.
Petitioner also contends that there is a possibility that two conflicting decisions might result from the civil case for annulment of marriage and the criminal case
for concubinage. In the civil case, the trial court might declare the marriage as valid by dismissing petitioner's complaint but in the criminal case, the trial court
might acquit petitioner because the evidence shows that his marriage is void on ground of psychological incapacity. Petitioner submits that the possible conflict
of the courts' ruling regarding petitioner's marriage can be avoided, if the criminal case will be suspended, until the court rules on the validity of marriage; that
if petitioner's marriage is declared void by reason of psychological incapacity then by reason of the arguments submitted in the subject petition, his marriage
has never existed; and that, accordingly, petitioner could not be convicted in the criminal case because he was never before a married man.
Petitioner's contentions are untenable.
The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. It has two essential elements: (a) the civil action involves an
issue similar or intimately related to the issue raised in the criminal action; and (b) the resolution of such issue determines whether or not the criminal action
may proceed.[11]
The pendency of the case for declaration of nullity of petitioner's marriage is not a prejudicial question to the concubinage case. For a civil case to be
considered prejudicial to a criminal action as to cause the suspension of the latter pending the final determination of the civil case, it must appear not only that
the said civil case involves the same facts upon which the criminal prosecution would be based, but also that in the resolution of the issue or issues raised in
the aforesaid civil action, the guilt or innocence of the accused would necessarily be determined.
209
Article 40 of the Family Code provides:
"The absolute nullity of a previous marriage may be invoked for purposes of remarriage on the basis solely of a final judgment declaring such previous
marriage void."
In Domingo vs. Court of Appeals,[12] this Court ruled that the import of said provision is that for purposes of remarriage, the only legally acceptable basis for
declaring a previous marriage an absolute nullity is a final judgment declaring such previous marriage void, whereas, for purposes of other than remarriage,
other evidence is acceptable. The pertinent portions of said Decision read:
"xxx Undoubtedly, one can conceive of other instances where a party might well invoke the absolute nullity of a previous marriage for purposes other than
remarriage, such as in case of an action for liquidation, partition, distribution and separation of property between the erstwhile spouses, as well as an action
for the custody and support of their common children and the delivery of the latters' presumptive legitimes. In such cases, evidence needs must be adduced,
testimonial or documentary, to prove the existence of grounds rendering such a previous marriage an absolute nullity. These needs not be limited solely to
an earlier final judgment of a court declaring such previous marriage void."
So that in a case for concubinage, the accused, like the herein petitioner need not present a final judgment declaring his marriage void for he can adduce
evidence in the criminal case of the nullity of his marriage other than proof of a final judgment declaring his marriage void.
With regard to petitioner's argument that he could be acquitted of the charge of concubinage should his marriage be declared null and void, suffice it to state
that even a subsequent pronouncement that his marriage is void from the beginning is not a defense.
Analogous to this case is that of Landicho vs. Reloval[13] cited in Donato vs. Luna[14] where this Court held that:
"xxx Assuming that the first marriage was null and void on the ground alleged by petitioner, that fact would not be material to the outcome of the criminal case.
Parties to the marriage should not be permitted to judge for themselves its nullity, for the same must be submitted to the judgment of the competent courts
and only when the nullity of the marriage is so declared can it be held as void, and so long as there is no such declaration the presumption is that the marriage
exists. Therefore, he who contracts a second marriage before the judicial declaration of nullity of the first marriage assumes the risk of being prosecuted for
bigamy."
Thus, in the case at bar it must also be held that parties to the marriage should not be permitted to judge for themselves its nullity, for the same must be
submitted to judgment of the competent courts and only when the nullity of the marriage is so declared can it be held as void, and so long as there is no such
declaration the presumption is that the marriage exists for all intents and purposes. Therefore, he who cohabits with a woman not his wife before the judicial
declaration of nullity of the marriage assumes the risk of being prosecuted for concubinage. The lower court therefore, has not erred in affirming the Orders
of the judge of the Metropolitan Trial Court ruling that pendency of a civil action for nullity of marriage does not pose a prejudicial question in a criminal case
for concubinage.
WHEREFORE, for lack of merit, the instant petition is DISMISSED.
210
SO ORDERED.
PASI VS LICHAUCO 2006
On June 6, 1994, a Memorandum of Understanding[1] (MOU) was entered into by a consortium of private telecommunications carriers and the Department
of Transportation and Communications (DOTC) represented by then Secretary Jesus B. Garcia, Jr. relative to the launching, ownership, operation and
management of a Philippine satellite by a Filipino-owned or controlled private consortium or corporation.
Pursuant to Article IV of the MOU, the consortium of private telecommunications carriers formed a corporation and adopted the corporate name Philippine
Agila Satellite, Inc. (PASI), herein petitioner.
By letter[2] dated June 28, 1996, PASI president Rodrigo A. Silverio (Silverio) requested the then DOTC Secretary Amado S. Lagdameo, Jr. for official
government confirmation of the assignment of Philippine orbital slots 161E and 153E to PASI for its AGILA satellites.
In response to Silverios letter, Secretary Lagdameo, by letter[3] dated July 3, 1996, confirmed the governments assignment of Philippine orbital slots 161E
and 153E to PASI for its AGILA satellites.
PASI thereupon undertook preparations for the launching, operation and management of its satellites by, among other things, obtaining loans, increasing its
capital, conducting negotiations with its business partners, and making an initial payment of US$ 3.5 million to Aerospatiale, a French satellite manufacturer.
Michael de Guzman (de Guzman), PASI President and Chief Executive Officer (CEO), later informed Jesli Lapuz (Lapuz), President and CEO of the Landbank
of the Philippines, by letter[4] of December 3, 1996, of the governments assignment to PASI of orbital slots 161E and 153E and requested the banks
confirmation of its participation in a club loan in the amount of US$ 11 million, the proceeds of which would be applied to PASIs interim satellite.
It appears that Lapuz sent a copy of De Guzmans letter to then DOTC Undersecretary Josefina T. Lichauco, (Lichauco) who, by letter[5] of December 5,
1996, wrote Lapuz as follows:
1. Kindly be informed that there is simply no basis for Michael de Guzman to allege that the DOTC has assigned two (2) slots to PASI. He conveniently
neglected to attach as another annex, in addition to Sec. Lagdameos letter of 3 July 1996 (Annex A) the letter of 28 June (Annex B) in response to which the
July 3rd letter had been sent to PASI. Annex B precisely provides that one slot (153 E, to which the interim satellite was supposed to migrate) was to be used
for the migration of the Russian satellite in time for the APEC Leaders Summit. This particular endeavor was not successful. The interim satellite Gorizont
never moved from its orbital location of 130E Longitude. Annex C is a letter from an official of the Subic Bay Satellite Systems Inc., with its attachments,
addressed to me stating that as of the 13th of November, no such voyage to 153E orbital slot had been commenced. In fact DHI hid this fact from me, and in
fact stated that Gorizont had already moved and was on its way to 153E.
Since this timely migration did not happen in time for the APEC Leaders Meeting on 24 November, this 153E Longitude slot can no longer be assigned to
PASI.
The other slot 161E Longitude is the one that can be made available for PASIs eventual launch, in 1998 most likely, in exchange for one free satellite
transponder unit utilization, for all requirements of Government. These have yet to be embodied in a contract between PASI and the DOTC.
211
2. I understand from my meeting with DHI/PASI this morning, and from the de Guzman letter you sent to me, that the latter are still interested in pursuing
their interim satellite project and are applying for a loan with your bank. Of course they can always pursue this as a business venture of DHI/PASI which is
their own corporate business decision. The DOTC supports this venture but they will be getting only one orbital slot for both the Interim Satellite Project and
for the Launch Project. I understand from todays meeting with them that this is technically feasible.
3. As regards the use of the name Agila, Mr. de Guzmans allegation that DHI/PASI has registered Agila as a corporate alias/trademark is FALSE. There is
no such thing as registration of a corporate alias. Nor for that matter can the trade name of a satellite be registered for just any satellite, where it was the
President who chose the name for the first Philippine satellite in orbit. No one else coined that name but he. He has therefore given the name Agila I to the
Mabuhay satellite now in orbit at 144E, being the first Philippine satellite in orbit. He made this announcement in the presence of all the APEC Heads of State
just before the presentation to him of the Manila Action Plan for APEC.
Lichauco subsequently issued, in December 1997, a Notice of Offer[6] for several orbital slots including 153E.
PASI, claiming that the offer was without its knowledge and that it subsequently came to learn that another company whose identity had not been disclosed
had submitted a bid and won the award for orbital slot 153E, filed on January 23, 1998 a complaint[7] before the Regional Trial Court (RTC) of Mandaluyong
City against Lichauco and the Unknown Awardee, for injunction to enjoin the award of orbital slot 153E, declare its nullity, and for damages.
PASI also filed on February 23, 1998 a complaint before the Office of the Ombudsman against Secretary Josefina Trinidad Lichauco. In his affidavit-complaint,
de Guzman charged Lichauco with gross violation of Section 3(e) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, as
amended, reading:
(e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage or preference in the
discharge of his official, administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence. This provision shall
apply to officers and employees of officers or government corporations charged with the grant of licenses or permits or other concessions.
The complaint was docketed as OMB Case No. 0-98-0416. The Evaluation and Preliminary Investigation Bureau (EPIB) of the Office of the Ombudsman, by
Evaluation Report[8] dated April 15, 1998, found the existence of a prejudicial question after considering that the case filed with the RTC involves facts
intimately related to those upon which the criminal prosecution would be based and that the guilt or the innocence of the accused would necessarily be
determined in the resolution of the issues raised in the civil case. It thus concluded that the filing of the complaint before the Ombudsman is premature since
the issues involved herein are now subject of litigation in the case filed with the RTC, and accordingly recommended its dismissal. Then Ombudsman Aniano
A. Desierto approved on April 24, 1998 the recommendation of the EPIB.
PASI moved to reconsider[9] the dismissal of the complaint, but was denied by Order[10] dated July 17, 1998.
In the meantime, a motion to dismiss the civil case against respondent was denied by the trial court. On elevation of the order of denial to the Court of Appeals,
said court, by Decision dated February 21, 2000, ordered the dismissal of the case. This Court, by Decision dated May 3, 2006, ordered the reinstatement of
the case, however.[11]
PASI is now before this Court via petition for review on certiorari, arguing that the Ombudsman erred in dismissing the complaint.
212
In issue are 1) whether there exists a prejudicial question and, if in the affirmative, 2) whether the dismissal of the complaint on that account is in order.
Section 7, Rule 111 of the Rules on Criminal Procedure provides:

Section 7. Elements of prejudicial question. The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or
intimately related to the issue raised in the subsequent criminal action, and (b) the resolution of such issue determines whether or not the criminal action may
proceed.
The rationale for the principle of prejudicial question is that although it does not conclusively resolve the guilt or innocence of the accused, it tests the sufficiency
of the allegations in the complaint or information in order to sustain the further prosecution of the criminal case.[12] Hence, the need for its prior resolution
before further proceedings in the criminal action may be had.
PASI concedes that the issues in the civil case are similar or intimately related to the issue raised in the criminal case. It contends, however, that the resolution
of the issues in the civil case is not determinative of the guilt or innocence of Lichauco, it arguing that even if she is adjudged liable for damages, it does not
necessarily follow that she would be convicted of the crime charged.
To determine the existence of a prejudicial question in the case before the Ombudsman, it is necessary to examine the elements of Section 3(e) of R.A. 3019
for which Lichauco was charged and the causes of action in the civil case.
Section 3(e) of R.A. 3019 which was earlier quoted has the following elements:
1. The accused is a public officer discharging administrative or official functions or private persons charged in conspiracy with them;
2. The public officer committed the prohibited act during the performance of his official duty or in relation to his public position;
3. The public officer acted with manifest partiality, evident bad faith or gross, inexcusable negligence; and
4. His action caused undue injury to the Government or any private party, or gave any party any unwarranted benefit, advantage or preference to such
parties.
The civil case against Lichauco on the other hand involves three causes of action. The first, for injunction, seeks to enjoin the award of orbital slot 153E, the
DOTC having previously assigned the same to PASI; the second, for declaration of nullity of award, seeks to nullify the award given to the undisclosed bidder
for being beyond Lichaucos authority; and the third, for damages arising from Lichaucos questioned acts.
If the award to the undisclosed bidder of orbital slot 153E is, in the civil case, declared valid for being within Lichaucos scope of authority to thus free her from
liability for damages, there would be no prohibited act to speak of nor would there be basis for undue injury claimed to have been suffered by petitioner. The
finding by the Ombudsman of the existence of a prejudicial question is thus well-taken.
Respecting the propriety of the dismissal by the Ombudsman of the complaint due to the pendency of a prejudicial question, PASI argues that since the Rules
of Procedure of the Office of the Ombudsman is silent on the matter, the Rules of Court, specifically Section 6, Rule 111 of the Rules of Court, which now
reads:
213
SECTION 6. Suspension by reason of prejudicial question. A petition for suspension of the criminal action based upon the pendency of a prejudicial question
in a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in
court for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests. applies in a suppletory character.
The Ombudsman, on the other hand, argues that the above-quoted provision of the Rules of Court applies to cases which are at the preliminary or trial stage
and not to those, like the case subject of the present petition, at the evaluation stage.
The Ombudsman goes on to proffer that at the evaluation stage, the investigating officer may recommend any of several causes of action including dismissal
of the complaint for want of palpable merit or subjecting the complaint to preliminary investigation, and the evaluation of the complaint involves the discretion
of the investigating officer which this Court cannot interfere with.
While the evaluation of a complaint involves the discretion of the investigating officer, its exercise should not be abused[14] or wanting in legal basis.
Rule II, Section 2 of the Rules of Procedure of the Office of the Ombudsman reads:
SECTION 2. Evaluation. Upon evaluating the complaint, the investigating officer shall recommend whether it may be:
a) dismissed outright for want of palpable merit;

b) referred to respondent for comment;
c) indorsed to the proper government office or agency which has jurisdiction over the case;
d) forwarded to the appropriate office or official for fact-finding investigation;
e) referred for administrative adjudication; or
f) subjected to a preliminary investigation. (Underscoring supplied)
From the above-quoted provision, a complaint at the evaluation stage may be dismissed outright only for want of palpable merit. Want of palpable merit
obviously means that there is no basis for the charge or charges. If the complaint has prima facie merit, however, the investigating officer shall recommend
the adoption of any of the actions enumerated above from (b) to (f).
When, in the course of the actions taken by those to whom the complaint is endorsed or forwarded, a prejudicial question is found to be pending, Section 6,
Rule 111 of the Rules of Court should be applied in a suppletory character.[16] As laid down in Yap v. Paras,[17] said rule directs that the proceedings may
only be suspended, not dismissed, and that it may be made only upon petition, and not at the instance of the judge alone or as in this case, the investigating
officer.
To give imprimatur to the Ombudsmans dismissal of petitioners criminal complaint due to prejudicial question would not only run counter to the provision of
Section 6 of Rule 111 of the Rules of Court. It would sanction the extinguishment of criminal liability, if there be any, through prescription under Article 89 vis
a vis Articles 90 and 91 of the Revised Penal Code which respectively read:
ART. 89. How criminal liability is totally extinguished. Criminal liability is totally extinguished:
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1. By the death of the convict, as to the personal penalties; and as to pecuniary penalties, liability therefore is extinguished only when the death of the
2. By service of the sentence;
3. By amnesty, which completely extinguishes the penalty and all its effects;
4. By absolute pardon;
5. By prescription of the crime;
6. By prescription of the penalty;
7. By the marriage of the offended woman, as provided in Article 344 of this Code.
ART. 90. Prescription of crimes. Crimes punishable by death, reclusion perpetua or reclusion temporal shall prescribe in twenty years.
Crimes punishable by other afflictive penalties shall prescribe in fifteen years.
Those punishable by a correctional penalty shall prescribe in ten years; with the exception of those punishable by arresto mayor, which shall prescribe in five
years.
The crime of libel or other similar offenses shall prescribe in one year.
The offenses of oral defamation and slander by deed shall prescribe in six months.
Light offenses prescribe in two months.
When the penalty fixed by law is a compound one, the highest penalty shall be made the basis of the application of the rules contained in the first, second,
and third paragraphs of this article. x x x
ART. 91. Computation of prescription of offenses. The period of prescription shall commence to run from the day on which the crime is discovered by the
offended party, the authorities, or their agents, and shall be interrupted by the filing of the complaint or information, and shall commence to run again when
such proceedings terminate without the accused being convicted or acquitted, or are unjustifiably stopped for any reason not imputable to him.
x x x x (Emphasis and underscoring supplied)
WHEREFORE, the Order dated July 17, 1998 of respondent Ombudsman dismissing OMB Case No. 0-98-0416 against respondent then Secretary Josefina
Trinidad Lichauco is SET ASIDE.
The Ombudsman is ORDERED to REINSTATE to its docket for further proceedings, in line with the foregoing ratiocination, OMB Case No. 0-98-0416.
SO ORDERED
215
YAP VS CABALES 2009
This is a petition for review on certiorari under Rule 45 of the Rules of Court with prayer for the issuance of a writ of preliminary injunction and/or issuance of
status quo order seeking to annul and set aside the Resolution1 of the Court of Appeals (CA) dated July 17, 2003 denying petitioner's motion for
reconsideration of the Decision2 dated April 30, 2003 in CA-G.R. SP No. 68250.
The facts of the case are as follows:
Petitioner Jesse Y. Yap and his spouse Bessie Yap are engaged in the real estate business through their company Primetown Property Group.
Sometime in 1996, petitioner purchased several real properties from a certain Evelyn Te (Evelyn). In consideration of said purchases, petitioner issued several
Bank of the Philippine Islands (BPI) postdated checks to Evelyn. Thereafter, spouses Orlando and Mergyl Mirabueno and spouses Charlie and Jovita
Dimalanta, rediscounted the checks from Evelyn.
In the beginning, the first few checks were honored by the bank, but in the early part of 1997, when the remaining checks were deposited with the drawee
bank, they were dishonored for the reason that the "Account is Closed." Demands were made by Spouses Mirabueno and Spouses Dimalanta to the petitioner
to make good the checks. Despite this, however, the latter failed to pay the amounts represented by the said checks.
On December 8, 1997, Spouses Mirabueno filed a civil action for collection of sum of money, damages and attorney's fee with prayer for the issuance of a
writ of preliminary attachment against petitioner before the Regional Trial Court (RTC) of General Santos City, docketed as Civil Case No. 6231.3 On
December 15, 1997, Spouses Dimalanta followed suit and instituted a similar action, which was docketed as Civil Case No. 6238.4
Subsequently, on various dates, the Office of the City Prosecutor of General Santos City filed several informations for violation of Batas Pambansa Bilang
(B.P. Blg.) 22 against the petitioner with the Municipal Trial Court in Cities (MTCC), General Santos City. The criminal complaints were docketed as Criminal
Case Nos. 34873, 34874, 34862 to 34869, and Criminal Case No. 35522-I.5
In the criminal cases, petitioner filed separate motions to suspend proceedings on account of the existence of a prejudicial question and motion to exclude
the private prosecutor from participating in the proceedings.6 Petitioner prayed that the proceedings in the criminal cases be suspended until the civil cases
pending before the RTC were finally resolved.
The MTCC, in its Orders7 dated June 21, 2000 and July 4, 2000, denied the motions for lack of merit. Petitioner filed a Partial Motion for Reconsideration8
relative to Criminal Case Nos. 34873, 34874, 34862 to 34869 and a Motion for Reconsideration of the Part of the Order Denying the Motion to Suspend
Proceedings on Account of the Existence of a Prejudicial Question relative to Criminal Case No. 35522-I.9 The subsequent motions were denied in the
Order10 dated October 18, 2000.
Aggrieved, petitioner filed a Petition for Certiorari with a Prayer for the Issuance of a Writ of Preliminary Injunction11 before the RTC, docketed as SPL. Civil
Case No. 539, imputing grave abuse of discretion on the part of the MTCC Judge. On July 2, 2001, the RTC issued an Order12 denying the petition.
216
Petitioner then filed a Motion for Reconsideration,13 which was denied in an Order dated October 18, 2001.14
Thereafter, petitioner filed with the CA a Petition for Certiorari Prohibition and Mandamus with Urgent Prayer for the Issuance of Status Quo Order and Writ
of Preliminary Injunction,15 docketed as CA-G.R. SP No. 68250.
On April 30, 2003, the CA rendered a Decision16 dismissing the petition for lack of merit. The CA opined that Civil Case Nos. 6231 and 6238 did not pose a
prejudicial question to the prosecution of the petitioner for violation of B.P. Blg. 22.
The CA ruled:
In the instant case, a careful perusal of Civil Cases Nos. 6231 and 6238 reveals that the issue involved therein is not the validity of the sale as incorrectly
pointed out by the petitioner, but it is, whether or not the complainants therein are entitled to collect from the petitioner the sum or the value of the checks
which they have rediscounted from Evelyn Te. It behooves this Court to state that the sale and the rediscounting of the checks are two transactions, separate
and distinct from each other. It so happened that in the subject civil cases it is not the sale that is in question, but rather the rediscounting of the checks.
Therefore, petitioner's contention that the main issue involved in said civil cases is the validity of the sale stands on hollow ground. Furthermore, if it is indeed
the validity of the sale that is contested in the subject civil cases, then, We cannot fathom why the petitioner never contested such sale by filing an action for
the annulment thereof or at least invoked or prayed in his answer that the sale be declared null and void. Accordingly, even if Civil Cases Nos. 6231 and 6238
are tried and the resolution of the issues therein is had, it cannot be deduced therefrom that the petitioner cannot be held liable anymore for violation of B.P.
Blg. 22.17
Petitioner filed a Motion for Reconsideration,18 which was denied in the Order19 dated July 17, 2003.
Hence, the petition assigning the following errors:
1. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT THERE IS NO PREJUDICIAL QUESTION IN THE CIVIL CASES (FOR COLLECTION
OF SUMS OF MONEY INSTITUTED BY PRIVATE RESPONDENTS OVER CHECKS ISSUED BY THE PETITIONER, CIVIL CASE NOS. 6238 AND 6231)
THAT WOULD WARRANT SUSPENSION OF THE CRIMINAL CASES (CASE NO. 35522-1, FOR VIOLATION OF B.P. 22, SUBJECT OF WHICH ARE THE
VERY SAME CHECKS).
2. THE HONORABLE COURT OF APPEALS ERRED IN NOT GRANTING THE PRAYER FOR THE ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION
AND/OR STATUS QUO ORDER.20
The main contention of the petitioner is that a prejudicial question, as defined by law and jurisprudence, exists in the present case. It is the petitioner's assertion
that Civil Case Nos. 6231 and 6238 for collection of sum of money and damages were filed ahead of the criminal cases for violation of B.P. Blg. 22. He further
alleged that, in the pending civil cases, the issue as to whether private respondents are entitled to collect from the petitioner despite the lack of consideration,
is an issue that is a logical antecedent to the criminal cases for violation of B.P. Blg. 22. For if the court rules that there is no valid consideration for the check's
issuance, as petitioner contends, then it necessarily follows that he could not also be held liable for violation of B.P. Blg. 22.
217
Petitioner further avers that B.P. Blg. 22 specifically requires, among other elements, that the check should have been issued for account or for value. There
must be a valid consideration; otherwise, no violation of the said law could be rightfully pursued. Petitioner said that the reason for the dishonor of the checks
was his order to the drawee bank to stop payment and to close his account in order to avoid necessary penalty from the bank. He made this order due to the
failure of Evelyn to deliver to him the titles to the purchased properties to him.
On the other hand, the Office of the Solicitor General (OSG) contends that there is no prejudicial question in Civil Case Nos. 6231 and 6238 which would
warrant the suspension of the proceedings in the criminal cases for violation of B.P. Blg. 22 against the petitioner. The issue in the civil cases is not the validity
of the sale between the petitioner and Evelyn, but whether the complainants therein are entitled to damages arising from the checks. These checks were
issued by the petitioner in favor of Evelyn, who, thereafter, negotiated the same checks to private complainants. The checks were subsequently dishonored
due to insufficiency of funds. The OSG maintains that the resolution of such issue has absolutely no bearing on the issue of whether petitioner may be held
liable for violation of B.P. Blg. 22.21
The present case hinges on the determination of whether there exists a prejudicial question that necessitates the suspension of the proceedings in the MTCC.
We find that there is none and, thus, we resolve to deny the petition.
A prejudicial question generally exists in a situation where a civil action and a criminal action are both pending, and there exists in the former an issue that
must be preemptively resolved before the latter may proceed, because howsoever the issue raised in the civil action is resolved would be determinative juris
et de jure of the guilt or innocence of the accused in the criminal case. The rationale behind the principle of prejudicial question is to avoid two conflicting
decisions. It has two essential elements: (i) the civil action involves an issue similar or intimately related to the issue raised in the criminal action; and (ii) the
resolution of such issue determines whether or not the criminal action may proceed.22
If both civil and criminal cases have similar issues, or the issue in one is intimately related to the issues raised in the other, then a prejudicial question would
likely exist, provided the other element or characteristic is satisfied. It must appear not only that the civil case involves the same facts upon which the criminal
prosecution would be based, but also that the resolution of the issues raised in the civil action would be necessarily determinative of the guilt or innocence of
the accused. If the resolution of the issue in the civil action will not determine the criminal responsibility of the accused in the criminal action based on the
same facts, or if there is no necessity that the civil case be determined first before taking up the criminal case, the civil case does not involve a prejudicial
question.23 Neither is there a prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other.24
The issue in the criminal cases is whether the petitioner is guilty of violating B.P. Blg. 22, while in the civil case, it is whether the private respondents are
entitled to collect from the petitioner the sum or the value of the checks that they have rediscounted from Evelyn.lavvphil
The resolution of the issue raised in the civil action is not determinative of the guilt or innocence of the accused in the criminal cases against him, and there
is no necessity that the civil case be determined first before taking up the criminal cases.
In the aforementioned civil actions, even if petitioner is declared not liable for the payment of the value of the checks and damages, he cannot be adjudged
free from criminal liability for violation of B.P. Blg. 22. The mere issuance of worthless checks with knowledge of the insufficiency of funds to support the
checks is in itself an offense.25
218
In Jose v. Suarez,26 the prejudicial question under determination was whether the daily interest rate of 5% was void, such that the checks issued by
respondents to cover said interest were likewise void for being contra bonos mores, and thus the cases for B.P. Blg. 22 will no longer prosper. In resolving
the issue, We ruled that "whether or not the interest rate imposed by petitioners is eventually declared void for being contra bonos mores will not affect the
outcome of the BP Blg. 22 cases because what will ultimately be penalized is the mere issuance of bouncing checks. In fact, the primordial question posed
before the court hearing the B.P. Blg. 22 cases is whether the law has been breached; that is, if a bouncing check has been issued."
Further, We held in Ricaforte v. Jurado,27 that:
The gravamen of the offense punished by B.P. Blg. 22 is the act of making and issuing a worthless check; that is, a check that is dishonored upon its
presentation for payment. In Lozano v. Martinez, we have declared that it is not the non-payment of an obligation which the law punishes. The law is not
intended or designed to coerce a debtor to pay his debt. The thrust of the law is to prohibit, under pain of penal sanctions, the making and circulation of
worthless checks. Because of its deleterious effects on the public interest, the practice is proscribed by the law. The law punishes the act not as an offense
against property, but an offense against public order. In People v. Nitafan, we said that a check issued as an evidence of debt - though not intended to be
presented for payment - has the same effect as an ordinary check and would fall within the ambit of B.P. Blg. 22.
x x x The mere act of issuing a worthless check - whether as a deposit, as a guarantee or even as evidence of pre-existing debt - is malum prohibitum.
To determine the reason for which checks are issued, or the terms and conditions for their issuance, will greatly erode the faith the public reposes in the
stability and commercial value of checks as currency substitutes, and bring about havoc in trade and in banking communities. So what the law punishes is
the issuance of a bouncing check and not the purpose for which it was issued or the terms and conditions relating to its issuance. The mere act of issuing a
worthless check is malum prohibitum.28
Moreover, petitioner's reliance on Ras v. Rasul29 is misplaced. The case of Ras involves a complaint for nullification of a deed of sale on the ground of an
alleged double sale. While the civil case was pending, an information for estafa was filed against Ras (the defendant in the civil case) arising from the same
alleged double sale, subject matter of the civil complaint. The Court ruled that there was a prejudicial question considering that the defense in the civil case
was based on the very same facts that would be determinative of the guilt or innocence of the accused in the estafa case.
The instant case is different from Ras, inasmuch as the determination of whether the petitioner is liable to pay the private respondents the value of the checks
and damages, will not affect the guilt or innocence of the petitioner because the material question in the criminal cases is whether petitioner had issued bad
checks, regardless of the purpose or condition of its issuance.
Guided by the following legal precepts, it is clear that the determination of the issues involved in Civil Case Nos. 6231 and 6238 for collection of sum of money
and damages is irrelevant to the guilt or innocence of the petitioner in the criminal cases for violation of B.P. Blg. 22.
In addition, petitioner's claim of lack of consideration may be raised as a defense during the trial of the criminal cases against him. The validity and merits of
a partys defense and accusation, as well as the admissibility and weight of testimonies and evidence brought before the court, are better ventilated during
trial proper.
219
Precisely, the reason why a state has courts of law is to ascertain the respective rights of the parties, to examine and to put to test all their respective
allegations and evidence through a well designed machinery termed "trial." Thus, all the defenses available to the accused should be invoked in the trial of
the criminal cases. This court is not the proper forum that should ascertain the facts and decide the case for violation of B.P. Blg. 22 filed against the petitioner.
In fine, the CA committed no reversible error in affirming the decision of the RTC.
WHEREFORE, the petition is DENIED and the Decision dated April 30, 2003 and the Resolution dated July 17, 2003 of the Court of Appeals in CA-G.R. SP
No. 68250 are AFFIRMED.
SO ORDERED.
DREAMWORK VS JANIOLA 2009
The Case
Petitioner Dreamwork Construction, Inc. seeks the reversal of the August 26, 2008 Decision1 in SCA No. 08-0005 of the Regional Trial Court (RTC), Branch
253 in Las Pias City. The Decision affirmed the Orders dated October 16, 20072 and March 12, 20083 in Criminal Case Nos. 55554-61 issued by the
Metropolitan Trial Court (MTC), Branch 79 in Las Pias City.
The Facts
On October 18, 2004, petitioner, through its President, Roberto S. Concepcion, and Vice-President for Finance and Marketing, Normandy P. Amora, filed a
Complaint Affidavit dated October 5, 20044 for violation of Batas Pambansa Bilang 22 (BP 22) against private respondent Cleofe S. Janiola with the Office of
the City Prosecutor of Las Pias City. The case was docketed as I.S. No. 04-2526-33. Correspondingly, petitioner filed a criminal information for violation of
BP 22 against private respondent with the MTC on February 2, 2005 docketed as Criminal Case Nos. 55554-61, entitled People of the Philippines v. Cleofe
S. Janiola.
On September 20, 2006, private respondent, joined by her husband, instituted a civil complaint against petitioner by filing a Complaint dated August 20065
for the rescission of an alleged construction agreement between the parties, as well as for damages. The case was filed with the RTC, Branch 197 in Las
Pias City and docketed as Civil Case No. LP-06-0197. Notably, the checks, subject of the criminal cases before the MTC, were issued in consideration of
the construction agreement.
Thereafter, on July 25, 2007, private respondent filed a Motion to Suspend Proceedings dated July 24, 20076 in Criminal Case Nos. 55554-61, alleging that
the civil and criminal cases involved facts and issues similar or intimately related such that in the resolution of the issues in the civil case, the guilt or innocence
of the accused would necessarily be determined. In other words, private respondent claimed that the civil case posed a prejudicial question as against the
criminal cases.
220
Petitioner opposed the suspension of the proceedings in the criminal cases in an undated Comment/Opposition to Accuseds Motion to Suspend Proceedings
based on Prejudicial Question7 on the grounds that: (1) there is no prejudicial question in this case as the rescission of the contract upon which the bouncing
checks were issued is a separate and distinct issue from the issue of whether private respondent violated BP 22; and (2) Section 7, Rule 111 of the Rules of
Court states that one of the elements of a prejudicial question is that "the previously instituted civil action involves an issue similar or intimately related to the
issue raised in the subsequent criminal action"; thus, this element is missing in this case, the criminal case having preceded the civil case.
Later, the MTC issued its Order dated October 16, 2007, granting the Motion to Suspend Proceedings, and reasoned that:
Should the trial court declare the rescission of contract and the nullification of the checks issued as the same are without consideration, then the instant
criminal cases for alleged violation of BP 22 must be dismissed. The belated filing of the civil case by the herein accused did not detract from the correctness
of her cause, since a motion for suspension of a criminal action may be filed at any time before the prosecution rests (Section 6, Rule 111, Revised Rules of
Court).8
In an Order dated March 12, 2008,9 the MTC denied petitioners Motion for Reconsideration dated November 29, 2007.
Petitioner appealed the Orders to the RTC with a Petition dated May 13, 2008. Thereafter, the RTC issued the assailed decision dated August 26, 2008,
denying the petition. On the issue of the existence of a prejudicial question, the RTC ruled:
Additionally, it must be stressed that the requirement of a "previously" filed civil case is intended merely to obviate delays in the conduct of the criminal
proceedings. Incidentally, no clear evidence of any intent to delay by private respondent was shown. The criminal proceedings are still in their initial stages
when the civil action was instituted. And, the fact that the civil action was filed after the criminal action was instituted does not render the issues in the civil
action any less prejudicial in character.10
Hence, we have this petition under Rule 45.
The Issue
WHETHER OR NOT THE COURT A QUO SERIOUSLY ERRED IN NOT PERCEIVING GRAVE ABUSE OF DISCRETION ON THE PART OF THE INFERIOR
COURT, WHEN THE LATTER RULED TO SUSPEND PROCEEDINGS IN CRIM. CASE NOS. 55554-61 ON THE BASIS OF "PREJUDICIAL QUESTION"
IN CIVIL CASE NO. LP-06-0197.11
The Courts Ruling
This petition must be granted.

The Civil Action Must Precede the Filing of the
Criminal Action for a Prejudicial Question to Exist
221
Under the 1985 Rules on Criminal Procedure, as amended by Supreme Court Resolutions dated June 17, 1988 and July 7, 1988, the elements of a prejudicial
question are contained in Rule 111, Sec. 5, which states:
SEC. 5. Elements of prejudicial question. The two (2) essential elements of a prejudicial question are: (a) the civil action involves an issue similar or
intimately related to the issue raised in the criminal action; and (b) the resolution of such issue determines whether or not the criminal action may proceed.
Thus, the Court has held in numerous cases12 that the elements of a prejudicial question, as stated in the above-quoted provision and in Beltran v. People,13
are:
The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. It has two essential elements: (a) the civil action involves an
issue similar or intimately related to the issue raised in the criminal action; and (b) the resolution of such issue determines whether or not the criminal action
may proceed.
On December 1, 2000, the 2000 Rules on Criminal Procedure, however, became effective and the above provision was amended by Sec. 7 of Rule 111,
which applies here and now provides:
SEC. 7. Elements of prejudicial question.The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or
proceed. (Emphasis supplied.)
Petitioner interprets Sec. 7(a) to mean that in order for a civil case to create a prejudicial question and, thus, suspend a criminal case, it must first be established
that the civil case was filed previous to the filing of the criminal case. This, petitioner argues, is specifically to guard against the situation wherein a party would
belatedly file a civil action that is related to a pending criminal action in order to delay the proceedings in the latter.
On the other hand, private respondent cites Article 36 of the Civil Code which provides:
Art. 36. Pre-judicial questions which must be decided before any criminal prosecution may be instituted or may proceed, shall be governed by rules of court
which the Supreme Court shall promulgate and which shall not be in conflict with the provisions of this Code. (Emphasis supplied.)
Private respondent argues that the phrase "before any criminal prosecution may be instituted or may proceed" must be interpreted to mean that a prejudicial
question exists when the civil action is filed either before the institution of the criminal action or during the pendency of the criminal action. Private respondent
concludes that there is an apparent conflict in the provisions of the Rules of Court and the Civil Code in that the latter considers a civil case to have presented
a prejudicial question even if the criminal case preceded the filing of the civil case.
We cannot agree with private respondent.
First off, it is a basic precept in statutory construction that a "change in phraseology by amendment of a provision of law indicates a legislative intent to change
the meaning of the provision from that it originally had."14 In the instant case, the phrase, "previously instituted," was inserted to qualify the nature of the civil
222
action involved in a prejudicial question in relation to the criminal action. This interpretation is further buttressed by the insertion of "subsequent" directly before
the term criminal action. There is no other logical explanation for the amendments except to qualify the relationship of the civil and criminal actions, that the
civil action must precede the criminal action.
Thus, this Court ruled in Torres v. Garchitorena15 that:
Even if we ignored petitioners procedural lapse and resolved their petition on the merits, we hold that Sandiganbayan did not abuse its discretion amounting
to excess or lack of jurisdiction in denying their omnibus motion for the suspension of the proceedings pending final judgment in Civil Case No. 7160. Section
6, Rule lll of the Rules of Criminal Procedure, as amended, reads:
Sec. 6. Suspension by reason of prejudicial question. - A petition for suspension of the criminal action based upon the pendency of a prejudicial question in a
civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court
for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests.
Sec. 7. Elements of prejudicial question. - The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or
proceed.
Under the amendment, a prejudicial question is understood in law as that which must precede the criminal action and which requires a decision before a final
judgment can be rendered in the criminal action with which said question is closely connected. The civil action must be instituted prior to the institution of the
criminal action. In this case, the Information was filed with the Sandiganbayan ahead of the complaint in Civil Case No. 7160 filed by the State with the RTC
in Civil Case No. 7160. Thus, no prejudicial question exists. (Emphasis supplied.)
Additionally, it is a principle in statutory construction that "a statute should be construed not only to be consistent with itself but also to harmonize with other
laws on the same subject matter, as to form a complete, coherent and intelligible system."16 This principle is consistent with the maxim, interpretare et
concordare leges legibus est optimus interpretandi modus or every statute must be so construed and harmonized with other statutes as to form a uniform
system of jurisprudence.171 a vv p h i l
In other words, every effort must be made to harmonize seemingly conflicting laws. It is only when harmonization is impossible that resort must be made to
choosing which law to apply.
In the instant case, Art. 36 of the Civil Code and Sec. 7 of Rule 111 of the Rules of Court are susceptible of an interpretation that would harmonize both
provisions of law. The phrase "previously instituted civil action" in Sec. 7 of Rule 111 is plainly worded and is not susceptible of alternative interpretations.
The clause "before any criminal prosecution may be instituted or may proceed" in Art. 36 of the Civil Code may, however, be interpreted to mean that the
motion to suspend the criminal action may be filed during the preliminary investigation with the public prosecutor or court conducting the investigation, or
during the trial with the court hearing the case.
223
This interpretation would harmonize Art. 36 of the Civil Code with Sec. 7 of Rule 111 of the Rules of Court but also with Sec. 6 of Rule 111 of the Civil Code,
which provides for the situations when the motion to suspend the criminal action during the preliminary investigation or during the trial may be filed. Sec. 6
provides:
SEC. 6. Suspension by reason of prejudicial question.A petition for suspension of the criminal action based upon the pendency of a prejudicial question in
a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court
for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests.
Thus, under the principles of statutory construction, it is this interpretation of Art. 36 of the Civil Code that should govern in order to give effect to all the
relevant provisions of law.
It bears pointing out that the circumstances present in the instant case indicate that the filing of the civil action and the subsequent move to suspend the
criminal proceedings by reason of the presence of a prejudicial question were a mere afterthought and instituted to delay the criminal proceedings.
In Sabandal v. Tongco,18 we found no prejudicial question existed involving a civil action for specific performance, overpayment, and damages, and a criminal
complaint for BP 22, as the resolution of the civil action would not determine the guilt or innocence of the accused in the criminal case. In resolving the case,
we said:
Furthermore, the peculiar circumstances of the case clearly indicate that the filing of the civil case was a ploy to delay the resolution of the criminal cases.
Petitioner filed the civil case three years after the institution of the criminal charges against him. Apparently, the civil action was instituted as an afterthought
to delay the proceedings in the criminal cases.19
Here, the civil case was filed two (2) years after the institution of the criminal complaint and from the time that private respondent allegedly withdrew its
equipment from the job site. Also, it is worth noting that the civil case was instituted more than two and a half (2 ) years from the time that private respondent
allegedly stopped construction of the proposed building for no valid reason. More importantly, the civil case praying for the rescission of the construction
agreement for lack of consideration was filed more than three (3) years from the execution of the construction agreement.
Evidently, as in Sabandal, the circumstances surrounding the filing of the cases involved here show that the filing of the civil action was a mere afterthought
on the part of private respondent and interposed for delay. And as correctly argued by petitioner, it is this scenario that Sec. 7 of Rule 111 of the Rules of
Court seeks to prevent. Thus, private respondents positions cannot be left to stand.
The Resolution of the Civil Case Is Not

Determinative of the Prosecution of the Criminal Action
In any event, even if the civil case here was instituted prior to the criminal action, there is, still, no prejudicial question to speak of that would justify the
suspension of the proceedings in the criminal case.
224
To reiterate, the elements of a prejudicial question under Sec. 7 of Rule 111 of the Rules of Court are: (1) the previously instituted civil action involves an
issue similar or intimately related to the issue raised in the subsequent criminal action; and (2) the resolution of such issue determines whether or not the
criminal action may proceed.
Petitioner argues that the second element of a prejudicial question, as provided in Sec. 7 of Rule 111 of the Rules, is absent in this case. Thus, such rule
cannot apply to the present controversy.
Private respondent, on the other hand, claims that if the construction agreement between the parties is declared null and void for want of consideration, the
checks issued in consideration of such contract would become mere scraps of paper and cannot be the basis of a criminal prosecution.
We find for petitioner.
It must be remembered that the elements of the crime punishable under BP 22 are as follows:
(1) the making, drawing, and issuance of any check to apply for account or for value;
(2) the knowledge of the maker, drawer, or issuer that at the time of issue there are no sufficient funds in or credit with the drawee bank for the payment of
such check in full upon its presentment; and
(3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit, or dishonor for the same reason had not the drawer, without
any valid cause, ordered the bank to stop payment.20
Undeniably, the fact that there exists a valid contract or agreement to support the issuance of the check/s or that the checks were issued for valuable
consideration does not make up the elements of the crime. Thus, this Court has held in a long line of cases21 that the agreement surrounding the issuance
of dishonored checks is irrelevant to the prosecution for violation of BP 22. In Mejia v. People,22 we ruled:
It must be emphasized that the gravamen of the offense charge is the issuance of a bad check. The purpose for which the check was issued, the terms and
conditions relating to its issuance, or any agreement surrounding such issuance are irrelevant to the prosecution and conviction of petitioner. To determine
the reason for which checks are issued, or the terms and conditions for their issuance, will greatly erode the faith the public reposes in the stability and
commercial value of checks as currency substitutes, and bring havoc in trade and in banking communities. The clear intention of the framers of B.P. 22 is to
make the mere act of issuing a worthless check malum prohibitum.
Lee v. Court of Appeals23 is even more poignant. In that case, we ruled that the issue of lack of valuable consideration for the issuance of checks which were
later on dishonored for insufficient funds is immaterial to the success of a prosecution for violation of BP 22, to wit:
Third issue. Whether or not the check was issued on account or for value.
Petitioners claim is not feasible. We have held that upon issuance of a check, in the absence of evidence to the contrary, it is presumed that the same was
issued for valuable consideration. Valuable consideration, in turn, may consist either in some right, interest, profit or benefit accruing to the party who makes
the contract, or some forbearance, detriment, loss or some responsibility, to act, or labor, or service given, suffered or undertaken by the other side. It is an
obligation to do, or not to do in favor of the party who makes the contract, such as the maker or indorser.
225
In this case, petitioner himself testified that he signed several checks in blank, the subject check included, in exchange for 2.5% interest from the proceeds of
loans that will be made from said account. This is a valuable consideration for which the check was issued. That there was neither a pre-existing obligation
nor an obligation incurred on the part of petitioner when the subject check was given by Bautista to private complainant on July 24, 1993 because petitioner
was no longer connected with Unlad or Bautista starting July 1989, cannot be given merit since, as earlier discussed, petitioner failed to adequately prove
that he has severed his relationship with Bautista or Unlad.
At any rate, we have held that what the law punishes is the mere act of issuing a bouncing check, not the purpose for which it was issued nor the terms and
conditions relating to its issuance. This is because the thrust of the law is to prohibit the making of worthless checks and putting them into circulation.24
(Emphasis supplied.)
Verily, even if the trial court in the civil case declares that the construction agreement between the parties is void for lack of consideration, this would not affect
the prosecution of private respondent in the criminal case. The fact of the matter is that private respondent indeed issued checks which were subsequently
dishonored for insufficient funds. It is this fact that is subject of prosecution under BP 22.lawphil.net
Therefore, it is clear that the second element required for the existence of a prejudicial question, that the resolution of the issue in the civil action would
determine whether the criminal action may proceed, is absent in the instant case. Thus, no prejudicial question exists and the rules on it are inapplicable to
the case before us.
WHEREFORE, we GRANT this petition. We hereby REVERSE and SET ASIDE the August 26, 2008 Decision in SCA No. 08-0005 of the RTC, Branch 253
in Las Pias City and the Orders dated October 16, 2007 and March 12, 2008 in Criminal Case Nos. 55554-61 of the MTC, Branch 79 in Las Pias City. We
order the MTC to continue with the proceedings in Criminal Case Nos. 55554-61 with dispatch.
No costs.
SO ORDERED.
PIMENTEL VS PIMENTEL 2010
The Antecedent Facts
The facts are stated in the Court of Appeals decision:

On 25 October 2004, Maria Chrysantine Pimentel y Lacap (private respondent) filed an action for frustrated parricide against Joselito R. Pimentel (petitioner),
docketed as Criminal Case No. Q-04-130415, before the Regional Trial Court of Quezon City, which was raffled to Branch 223 (RTC Quezon City).
On 7 February 2005, petitioner received summons to appear before the Regional Trial Court of Antipolo City, Branch 72 (RTC Antipolo) for the pre-trial and
trial of Civil Case No. 04-7392 (Maria Chrysantine Lorenza L. Pimentel v. Joselito Pimentel) for Declaration of Nullity of Marriage under Section 36 of the
Family Code on the ground of psychological incapacity.
226
On 11 February 2005, petitioner filed an urgent motion to suspend the proceedings before the RTC Quezon City on the ground of the existence of a prejudicial
question. Petitioner asserted that since the relationship between the offender and the victim is a key element in parricide, the outcome of Civil Case No. 04-
7392 would have a bearing in the criminal case filed against him before the RTC Quezon City.
The Decision of the Trial Court
The RTC Quezon City issued an Order dated 13 May 2005[3] holding that the pendency of the case before the RTC Antipolo is not a prejudicial question that
warrants the suspension of the criminal case before it. The RTC Quezon City held that the issues in Criminal Case No. Q-04-130415 are the injuries sustained
by respondent and whether the case could be tried even if the validity of petitioners marriage with respondent is in question. The RTC Quezon City ruled:
WHEREFORE, on the basis of the foregoing, the Motion to Suspend Proceedings On the [Ground] of the Existence of a Prejudicial Question is, for lack of
merit, DENIED.
SO ORDERED.[4]
Petitioner filed a motion for reconsideration. In its 22 August 2005 Order,[5] the RTC Quezon City denied the motion.
Petitioner filed a petition for certiorari with application for a writ of preliminary injunction and/or temporary restraining order before the Court of Appeals,
assailing the 13 May 2005 and 22 August 2005 Orders of the RTC Quezon City.
The Decision of the Court of Appeals
In its 20 March 2006 Decision, the Court of Appeals dismissed the petition. The Court of Appeals ruled that in the criminal case for frustrated parricide, the
issue is whether the offender commenced the commission of the crime of parricide directly by overt acts and did not perform all the acts of execution by
reason of some cause or accident other than his own spontaneous desistance. On the other hand, the issue in the civil action for annulment of marriage is
whether petitioner is psychologically incapacitated to comply with the essential marital obligations. The Court of Appeals ruled that even if the marriage
between petitioner and respondent would be declared void, it would be immaterial to the criminal case because prior to the declaration of nullity, the alleged
acts constituting the crime of frustrated parricide had already been committed. The Court of Appeals ruled that all that is required for the charge of frustrated
parricide is that at the time of the commission of the crime, the marriage is still subsisting.
Petitioner filed a petition for review before this Court assailing the Court of Appeals decision.
The Issue
The only issue in this case is whether the resolution of the action for annulment of marriage is a prejudicial question that warrants the suspension of the
criminal case for frustrated parricide against petitioner.
227
The Ruling of this Court
The petition has no merit.
Civil Case Must be Instituted

Before the Criminal Case
Section 7, Rule 111 of the 2000 Rules on Criminal Procedure[6] provides:
Section 7. Elements of Prejudicial Question. - The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or
intimately related to the issue raised in the subsequent criminal action and (b) the resolution of such issue determines whether or not the criminal action may
proceed.
The rule is clear that the civil action must be instituted first before the filing of the criminal action. In this case, the Information[7] for Frustrated Parricide was
dated 30 August 2004. It was raffled to RTC Quezon City on 25 October 2004 as per the stamped date of receipt on the Information. The RTC Quezon City
set Criminal Case No. Q-04-130415 for pre-trial and trial on 14 February 2005. Petitioner was served summons in Civil Case No. 04-7392 on 7 February
2005.[8] Respondents petition[9] in Civil Case No. 04-7392 was dated 4 November 2004 and was filed on 5 November 2004. Clearly, the civil case for
annulment was filed after the filing of the criminal case for frustrated parricide. As such, the requirement of Section 7, Rule 111 of the 2000 Rules on Criminal
Procedure was not met since the civil action was filed subsequent to the filing of the criminal action.
Annulment of Marriage is not a Prejudicial Question

in Criminal Case for Parricide
Further, the resolution of the civil action is not a prejudicial question that would warrant the suspension of the criminal action.
There is a prejudicial question when a civil action and a criminal action are both pending, and there exists in the civil action an issue which must be preemptively
resolved before the criminal action may proceed because howsoever the issue raised in the civil action is resolved would be determinative of the guilt or
innocence of the accused in the criminal case.[10] A prejudicial question is defined as:
x x x one that arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which pertains to another
tribunal. It is a question based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt or innocence of the
accused, and for it to suspend the criminal action, it must appear not only that said case involves facts intimately related to those upon which the criminal
prosecution would be based but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of the accused would necessarily
be determined.[11]
The relationship between the offender and the victim is a key element in the crime of parricide,[12] which punishes any person who shall kill his father, mother,
or child, whether legitimate or illegitimate, or any of his ascendants or descendants, or his spouse.[13] The relationship between the offender and the victim
distinguishes the crime of parricide from murder[14] or homicide.[15] However, the issue in the annulment of marriage is not similar or intimately related to
228
the issue in the criminal case for parricide. Further, the relationship between the offender and the victim is not determinative of the guilt or innocence of the
accused.
The issue in the civil case for annulment of marriage under Article 36 of the Family Code is whether petitioner is psychologically incapacitated to comply with
the essential marital obligations. The issue in parricide is whether the accused killed the victim. In this case, since petitioner was charged with frustrated
parricide, the issue is whether he performed all the acts of execution which would have killed respondent as a consequence but which, nevertheless, did not
produce it by reason of causes independent of petitioners will.[16] At the time of the commission of the alleged crime, petitioner and respondent were married.
The subsequent dissolution of their marriage, in case the petition in Civil Case No. 04-7392 is granted, will have no effect on the alleged crime that was
committed at the time of the subsistence of the marriage. In short, even if the marriage between petitioner and respondent is annulled, petitioner could still be
held criminally liable since at the time of the commission of the alleged crime, he was still married to respondent.
We cannot accept petitioners reliance on Tenebro v. Court of Appeals[17] that the judicial declaration of the nullity of a marriage on the ground of psychological
incapacity retroacts to the date of the celebration of the marriage insofar as the vinculum between the spouses is concerned x x x. First, the issue in Tenebro
is the effect of the judicial declaration of nullity of a second or subsequent marriage on the ground of psychological incapacity on a criminal liability for bigamy.
There was no issue of prejudicial question in that case. Second, the Court ruled in Tenebro that [t]here is x x x a recognition written into the law itself that
such a marriage, although void ab initio, may still produce legal consequences.[18] In fact, the Court declared in that case that a declaration of the nullity of
the second marriage on the ground of psychological incapacity is of absolutely no moment insofar as the States penal laws are concerned.[19]
In view of the foregoing, the Court upholds the decision of the Court of Appeals. The trial in Criminal Case No. Q-04-130415 may proceed as the resolution
of the issue in Civil Case No. 04-7392 is not determinative of the guilt or innocence of petitioner in the criminal case.
WHEREFORE, we DENY the petition. We AFFIRM the 20 March 2006 Decision of the Court of Appeals in CA-G.R. SP No. 91867.
SO ORDERED.
CONSING VS PEOPLE 2013
An independent civil action based on fraud initiated by the defrauded party does not raise a prejudicial question to stop the proceedings in a pending criminal
prosecution of the defendant for estafa through falsification. This is because the result of the independent civil action is irrelevant to the issue of guilt or
innocence of the accused.
The Case
On appeal is the amended decision promulgated on August 18, 2003,1 whereby the Court of Appeals (CA) granted the writ of certiorari upon petition by the
State in C.A.-G.R. No. 71252 entitled People v. Han. Winlove M Dumayas, Presiding Judge, Branch 59, Regional Trial Court, Makati City and Rafael Consing,
Jr., and set aside the assailed order issued on November 26, 2001 by the Regional Trial Court (RTC), Branch 59, in Makati City deferring the arraignment of
petitioner in Criminal Case No. 00-120 entitled People v. Rafael Consing, Jr. upon his motion on the ground of the existence of a prejudicial question in the
civil cases pending between him and the complainant in the trial courts in Pasig City and Makati City.
Antecedents
229
Petitioner negotiated with and obtained for himself and his mother, Cecilia de la Cruz (de la Cruz) various loans totaling P18,000,000.00 from Unicapital Inc.
(Unicapital). The loans were secured by a real estate mortgage constituted on a parcel of land (property) covered by Transfer Certificate of Title (TCT) No. T-
687599 of the Registry of Deeds for the Province of Cavite registered under the name of de la Cruz.2 In accordance with its option to purchase the mortgaged
property, Unicapital agreed to purchase one-half of the property for a total consideration of P21,221,500.00. Payment was effected by off-setting the amounts
due to
Unicapital under the promissory notes of de la Cruz and Consing in the amount of P18,000,000.00 and paying an additional amount of P3,145,946.50. The
other half of the property was purchased by Plus Builders, Inc. (Plus Builders), a joint venture partner of Unicapital.3
Before Unicapital and Plus Builders could develop the property, they learned that the title to the property was really TCT No. 114708 in the names of Po Willie
Yu and Juanito Tan Teng, the parties from whom the property had been allegedly acquired by de la Cruz. TCT No. 687599 held by De la Cruz appeared to
be spurious.4
On its part, Unicapital demanded the return of the total amount of P41,377,851.48 as of April 19, 1999 that had been paid to and received by de la Cruz and
Consing, but the latter ignored the demands.5
On July 22, 1999, Consing filed Civil Case No. 1759 in the Pasig City Regional Trial Court (RTC) (Pasig civil case) for injunctive relief, thereby seeking to
enjoin Unicapital from proceeding against him for the collection of the P41,377,851.48 on the ground that he had acted as a mere agent of his mother.
On the same date, Unicapital initiated a criminal complaint for estafa through falsification of public document against Consing and de la Cruz in the Makati
City Prosecutors Office.6
On August 6, 1999, Unicapital sued Consing in the RTC in Makati City (Civil Case No. 99-1418) for the recovery of a sum of money and damages, with an
application for a writ of preliminary attachment (Makati civil case).7
On January 27, 2000, the Office of the City Prosecutor of Makati City filed against Consing and De la Cruz an information for estafa through falsification of
public document in the RTC in Makati City (Criminal Case No. 00-120), which was assigned to Branch 60 (Makati criminal case).8
On February 15, 2001, Consing moved to defer his arraignment in the Makati criminal case on the ground of existence of a prejudicial question due to the
pendency of the Pasig and Makati civil cases. On September 25, 2001, Consing reiterated his motion for deferment of his arraignment, citing the additional
ground of pendency of CA-G.R. SP No. 63712 in the CA. On November 19, 2001, the Prosecution opposed the motion.9
On November 26, 2001, the RTC issued an order suspending the proceedings in the Makati criminal case on the ground of the existence of a prejudicial
question, and on March 18, 2001, the RTC denied the Prosecutions motion for reconsideration.10
The State thus assailed in the CA the last two orders of the RTC in the Makati criminal case via petition for certiorari (C.A.-G.R. SP No. 71252).
230
On May 20, 2003, the CA promulgated its decision in C.A.-G.R. SP No. 71252,11 dismissing the petition for certiorari and upholding the RTCs questioned
orders, explaining:
Is the resolution of the Pasig civil case prejudicial to the Cavite and Makati criminal cases?
We hold that it is. The resolution of the issue in the Pasig case, i.e. whether or not private respondent may be held liable in the questioned transaction, will
determine the guilt or innocence of private respondent Consing in both the Cavite and Makati criminal cases.
The analysis and comparison of the Pasig civil case, Makati criminal case, Makati civil case and Cavite criminal case show that: (1) the parties are identical;
(2) the transactions in controversy are identical; (3) the Transfer Certificate of Titles (TCT) involved are identical; (4) the questioned Deeds of Sale/Mortgage
are identical; (5) the dates in question are identical; and (6) the issue of private respondents culpability for the questioned transactions is identical in all the
proceedings.
As discussed earlier, not only was the issue raised in the Pasig civil case identical to or intimately related to the criminal cases in Cavite and Makati. The
similarities also extend to the parties in the cases and the TCT and Deed of Sale/ Mortgage involved in the questioned transactions.
The respondent Judge, in ordering the suspension of the arraignment of private respondent in the Makati case, in view of CA-G.R. SP No. 63712, where
Unicapital was not a party thereto, did so pursuant to its mandatory power to take judicial notice of an official act of another judicial authority. It was also a
better legal tack to prevent multiplicity of action, to which our legal system abhors.
Applying the Tuanda ruling, the pendency of CA-G.R. SP No. 63712 may be validly invoked to suspend private respondents arraignment in the Makati City
criminal case, notwithstanding the fact that CA-G.R. SP No. 63712 was an offshoot, merely, in the Cavite criminal case.12
In the meanwhile, on October 13, 1999, Plus Builders commenced its own suit for damages against Consing (Civil Case No. 99-95381) in the RTC in Manila
(Manila civil case).13
On January 21, 2000, an information for estafa through falsification of public document was filed against Consing and De la Cruz in the RTC in Imus, Cavite,
docketed as Criminal Case No. 7668-00 and assigned to Branch 21 (Cavite criminal case). Consing filed a motion to defer the arraignment on the ground of
the existence of a prejudicial question, i.e., the pendency of the Pasig and Manila civil cases. On January 27, 2000, however, the RTC handling the Cavite
criminal case denied Consings motion. Later on, it also denied his motion for reconsideration. Thereafter, Consing commenced in the CA a special civil action
for certiorari with prayer for the issuance of a temporary restraining order (TRO) and/or writ of preliminary injunction (C.A.-G.R. SP No. 63712), seeking to
enjoin his arraignment and trial in the Cavite criminal case. The CA granted the TRO on March 19, 2001, and later promulgated its decision on May 31, 2001,
granting Consing petition for certiorari and setting aside the January 27, 2000 order of the RTC, and permanently enjoining the RTC from proceeding with
the arraignment and trial until the Pasig and Manila civil cases had been finally decided.
Not satisfied, the State assailed the decision of the CA in this Court (G.R. No. 148193), praying for the reversal of the May 31, 2001 decision of the CA. On
January 16, 2003, the Court granted the petition for review in G.R. No. 148193, and reversed and set aside the May 31, 2001 decision of the CA,14 viz:
231
In the case at bar, we find no prejudicial question that would justify the suspension of the proceedings in the criminal case (the Cavite criminal case). The
issue in Civil Case No. SCA 1759 (the Pasig civil case) for Injunctive Relief is whether or not respondent (Consing) merely acted as an agent of his mother,
Cecilia de la Cruz; while in Civil Case No. 99-95381 (the Manila civil case), for Damages and Attachment, the question is whether respondent and his mother
are liable to pay damages and to return the amount paid by PBI for the purchase of the disputed lot. Even if respondent is declared merely an agent of his
mother in the transaction involving the sale of the questioned lot, he cannot be adjudged free from criminal liability. An agent or any person may be held liable
for conspiring to falsify public documents. Hence, the determination of the issue involved in Civil Case No. SCA 1759 for Injunctive Relief is irrelevant to the
guilt or innocence of the respondent in the criminal case for estafa through falsification of public document.
Likewise, the resolution of PBIs right to be paid damages and the purchase price of the lot in question will not be determinative of the culpability of the
respondent in the criminal case for even if PBI is held entitled to the return of the purchase price plus damages, it does not ipso facto follow that respondent
should be held guilty of estafa through falsification of public document. Stated differently, a ruling of the court in the civil case that PBI should not be paid the
purchase price plus damages will not necessarily absolve respondent of liability in the criminal case where his guilt may still be established under penal laws
as determined by other evidence.
Moreover, neither is there a prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other. Under Rule
111, Section 3 of the Revised Rules on Criminal Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent civil
action may be brought by the offended party. It shall proceed independently of the criminal action and shall require only a preponderance of evidence. In no
case, however, may the offended party recover damages twice for the same act or omission charged in the criminal action.
Thus, in Rojas v. People, the petitioner was accused in a criminal case for violation of Article 319 of the Revised Penal Code, for executing a new chattel
mortgage on personal property in favor of another party without consent of the previous mortgagee. Thereafter, the offended party filed a civil case for
termination of management contract, one of the causes of action of which consisted of petitioner having executed a chattel mortgage while the previous chattel
mortgage was still valid and subsisting. Petitioner moved that the arraignment and trial of the criminal case be held in abeyance on the ground that the civil
case was a prejudicial question, the resolution of which was necessary before the criminal proceedings could proceed. The trial court denied the suspension
of the criminal case on the ground that no prejudicial question exist. We affirmed the order of the trial court and ruled that:
the resolution of the liability of the defendant in the civil case on the eleventh cause of action based on the fraudulent misrepresentation that the chattel
mortgage the defendant executed in favor of the said CMS Estate, Inc. on February 20, 1957, that his D-6 "Caterpillar" Tractor with Serial No. 9-U-6565 was
"free from all liens and encumbrances" will not determine the criminal liability of the accused in the said Criminal Case No. 56042 for violation of paragraph 2
of Article 319 of the Revised Penal Code. . . . (i) That, even granting for the sake of argument, a prejudicial question is involved in this case, the fact remains
that both the crime charged in the information in the criminal case and the eleventh cause of action in the civil case are based upon fraud, hence both the civil
and criminal cases could proceed independently of the other pursuant to Article 33 of the new Civil Code which provides: "In cases of defamation, fraud and
physical injuries, a civil action for damages, entirely separate and distinct from the criminal action shall proceed independently of the criminal prosecution,
and shall require only a preponderance of evidence." (j) That, therefore, the act of respondent judge in issuing the orders referred to in the instant petition was
not made with "grave abuse of discretion."
232
In the instant case, Civil Case No. 99-95381, for Damages and Attachment on account of the alleged fraud committed by respondent and his mother in selling
the disputed lot to PBI is an independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that will justify the
suspension of the criminal case at bar.15
Turning back to the Makati criminal case, the State moved for the reconsideration of the adverse decision of the CA, citing the ruling in G.R. No. 148193,
supra, to the effect that the Pasig and Manila civil cases did not present a prejudicial question that justified the suspension of the proceedings in the Cavite
criminal case, and claiming that under the ruling in G.R. No. 148193, the Pasig and Makati civil cases did not raise a prejudicial question that would cause
the suspension of the Makati criminal case.
In his opposition to the States motion for reconsideration, Consing contended that the ruling in G.R. No. 148193 was not binding because G.R. No. 148193
involved Plus Builders, which was different from Unicapital, the complainant in the Makati criminal case. He added that the decision in G.R. No. 148193 did
not yet become final and executory, and could still be reversed at any time, and thus should not control as a precedent to be relied upon; and that he had
acted as an innocent attorney-in-fact for his mother, and should not be held personally liable under a contract that had involved property belonging to his
mother as his principal.
On August 18, 2003, the CA amended its decision, reversing itself. It relied upon the ruling in G.R. No. 148193, and held thusly:
CA-G.R. SP No. 63712 is similar with the case at bench. The transactions in controversy, the documents involved; the issue of the respondents culpability
for the questioned transactions are all identical in all the proceedings; and it deals with the same parties with the exception of private complainant Unicapital.
However, the Supreme Court, upon review of CA-G.R. SP No. 63712, People of the Philippines vs. Rafael Jose Consing, Jr. (G.R. No. 148193, January 16,
2003) held that "Civil Case No. 99-95381, for Damages and attachment on account of alleged fraud committed by respondent and his mother in selling the
disputed lot to Plus Builders, Inc. is an independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that will
justify the suspension of the criminal case at bar." In view of the aforementioned decision of the Supreme Court, We are thus amending Our May 20, 2003
decision.
WHEREFORE, the petitioners motion for reconsideration is GRANTED. The Orders dated November 26, 2001 and March 18, 2002 issued by the respondent
Judge are hereby REVERSED and SET ASIDE. Respondent Judge is hereby ordered to proceed with the hearing of Criminal Case No. 00-120 with dispatch.
SO ORDERED.16
Consing filed a motion for reconsideration,17 but the CA denied the motion through the second assailed resolution of December 11, 2003.18
Hence, this appeal by petition for review on certiorari.
Issue
233
Petitioner reiterates his contention that the decision in G.R. No. 148193 was not controlling in relation to C.A.-G.R. No. 71252, which involved Plus Builders,
not Unicapital, the complainant in Criminal Case No. 00-120. He posits that in arriving at its amended decision, the CA did not consider the pendency of the
Makati civil case (Civil Case No. 99-1418), which raised a prejudicial question, considering that the resolution of such civil action would include the issue of
whether he had falsified a certificate of title or had willfully defrauded Unicapital, the resolution of either of which would determine his guilt or innocence in
Criminal Case No. 00-120.
In its comment,19 the Office of the Solicitor General (OSG) counters that Unicapital brought the Makati civil case as an independent civil action intended to
exact civil liability separately from Criminal Case No. 00-120 in a manner fully authorized under Section 1(a) and Section 2, Rule 111 of the Rules of Court.20
It argues that the CA correctly took cognizance of the ruling in G.R. No. 148193, holding in its challenged amended decision that the Makati civil case, just
like the Manila civil case, was an independent civil action instituted by virtue of Article 33 of the Civil Code; that the Makati civil case did not raise a prejudicial
question that justified the suspension of Criminal Case No. 00-120; and that as finally settled in G.R. No. 148193, the Pasig civil case did not also raise any
prejudicial question, because the sole issue thereat was whether Consing, as the mere agent of his mother, had any obligation or liability toward Unicapital.
In his reply,21 Consing submits that the Pasig civil case that he filed and Unicapitals Makati civil case were not intended to delay the resolution of Criminal
Case No. 00-120, nor to pre-empt such resolution; and that such civil cases could be validly considered determinative of whether a prejudicial question existed
to warrant the suspension of Criminal Case No. 00-120.
Did the CA err in reversing itself on the issue of the existence of a prejudicial question that warranted the suspension of the proceedings in the Makati criminal
case?
Ruling
The petition for review on certiorari is absolutely meritless.
Consing has hereby deliberately chosen to ignore the firm holding in the ruling in G.R. No. 148193 to the effect that the proceedings in Criminal Case No. 00-
120 could not be suspended because the Makati civil case was an independent civil action, while the Pasig civil case raised no prejudicial question. That was
wrong for him to do considering that the ruling fully applied to him due to the similarity between his case with Plus Builders and his case with Unicapital.
A perusal of Unicapitals complaint in the Makati civil case reveals that the action was predicated on fraud. This was apparent from the allegations of Unicapital
in its complaint to the effect that Consing and de la Cruz had acted in a "wanton, fraudulent, oppressive, or malevolent manner in offering as security and later
object of sale, a property which they do not own, and foisting to the public a spurious title."22 As such, the action was one that could proceed independently
of Criminal Case No. 00-120 pursuant to Article 33 of the Civil Code, which states as follows:
Article 33. In cases of defamation, fraud, and physical injuries a civil action for damages, entirely separate and distinct from the criminal action, may be brought
by the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall require only a preponderance of evidence.
234
It is well settled that a civil action based on defamation, fraud and physical injuries may be independently instituted pursuant to Article 33 of the Civil Code,
and does not operate as a prejudicial question that will justify the suspension of a criminal case.23 This was precisely the Courts thrust in G.R. No. 148193,
thus:
Moreover, neither is there a prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other. Under Rule
111, Section 3 of the Revised Rules on Criminal Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent civil
action may be brought by the offended party. It shall proceed independently of the criminal action and shall require only a preponderance of evidence. In no
case, however, may the offended party recover damages twice for the same act or omission charged in the criminal action.
In the instant case, Civil Case No. 99-95381, for Damages and Attachment on account of the alleged fraud committed by respondent and his mother in selling
the disputed lot to PBI is an independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that will justify the
suspension of the criminal case at bar.24
Contrary to Consings stance, it was not improper for the CA to apply the ruling in G.R. No. 148193 to his case with Unicapital, for, although the Manila and
Makati civil cases involved different complainants (i.e., Plus Builders and Unicapital), the civil actions Plus Builders and Unicapital had separately instituted
against him were undeniably of similar mold, i.e., they were both based on fraud, and were thus covered by Article 33 of the Civil Code. Clearly, the Makati
criminal case could not be suspended pending the resolution of the Makati civil case that Unicapital had filed.
As far as the Pasig civil case is concerned, the issue of Consings being a mere agent of his mother who should not be criminally liable for having so acted
due to the property involved having belonged to his mother as principal has also been settled in G.R. No. 148193, to wit:
In the case at bar, we find no prejudicial question that would justify the suspension of the proceedings in the criminal case (the Cavite criminal case). The
issue in Civil Case No. SCA 1759 (the Pasig civil case) for Injunctive Relief is whether or not respondent (Consing) merely acted as an agent of his mother,
Cecilia de la Cruz; while in Civil Case No. 99-95381 (the Manila civil case), for Damages and Attachment, the question is whether respondent and his mother
are liable to pay damages and to return the amount paid by PBI for the purchase of the disputed lot. Even if respondent is declared merely an agent of his
mother in the transaction involving the sale of the questioned lot, he cannot be adjudged free from criminal liability. An agent or any person may be held liable
for conspiring to falsify public documents. Hence, the determination of the issue involved in Civil Case No. SCA 1759 for Injunctive Relief is irrelevant to the
guilt or innocence of the respondent in the criminal case for estafa through falsification of public document.25 (Words in parentheses supplied; bold
underscoring supplied for emphasis)
WHEREFORE, the Court AFFIRMS the amended decision promulgated on August 18, 2003; and ORDERS petitioner to pay the costs of suit.
SO ORDERED.
235
PEOPLE VS ARAMBULO 2015
This Petition for Review on Certiorari seeks to annul the Decision1 and Resolution2 dated 5 February 2008 and 27 February 2009, respectively of the Court
of Appeals, Seventeenth Division in CA-G.R. SP No. 86353 which effectively suspended the criminal proceedings in Criminal Case No. C-62784, an estafa
case against respondents before the Regional Trial Court (RTC), Branch 121, Caloocan City.
Records show that respondent Victoria R. Arambulo (Victoria), Emerenciana R. Gungab, Reynaldo Reyes (Reynaldo), Domingo Reyes (Domingo), Rodrigo
Reyes and Oscar Reyes (Oscar) are the heirs of Spouses Pedro C. Reyes and Anastacia Reyes. Anaped Estate Inc. (Anaped) was incorporated as part of
the estate planning or as conduit to hold the properties of the estate of Pedro Reyes for and in behalf of his heirs.
Jose Buban (Buban), as Vice-President and General Manager of Anaped Estate Inc. (Anaped), filed a complaint for estafa against Victoria and her husband
Miguel Arambulo, Jr. (Miguel) before the Office of the City Prosecutor of Caloocan City. He alleged that Victoria failed to remit the rentals collected from the
time the ownership of the commercial apartments was transferred to Anaped.
On 24 April 2001, Assistant City Prosecutor Alvin A. Almora recommended the filing of an Information against respondents. On 1 June 2001, respondents
were charged with estafa committed as follow:chanRoblesvirtualLawlibrary
That on [or] about the period from December, 1994 to June, 1997, in the City of Caloocan, Philippines, and within the jurisdiction of the Honorable Court, the
said accused, conspiring together and mutually helping one another, and with unfaithfulness or abuse of confidence, after having received rentals from IMF
International Corporation, in the total amount of THREE HUNDRED NINETEEN THOUSAND EIGHT HUNDRED EIGHTY-EIGHT (P319,888.00) PESOS,
under the express obligation of turning over or remitting the same to ANAPED ESTATE INCORPORATED, once in possession of the said amount and far
from complying with their obligation aforesaid and despite notice [to] that effect, the said accused did then and there willfully, unlawfully and feloniously
misappropriate, misapply, and convert the said amount to their own personal use and benefit to the damage and prejudice of ANAPED ESTATE, INC., in the
sum above-aforementioned.3
On 14 April 2003, respondents filed a Motion to Suspend Proceedings on the ground of a prejudicial question in view of the pendency of two intra-corporate
cases pending before the RTC of Quezon City and Makati City. SEC Case No. 05-97-5659 is a petition filed by Victorias brother Oscar for accounting of all
corporate funds and assets of Anaped, annulment of sale, injunction, receivership and damages.4 SEC Case No. 03-99-6259 is a petition filed by Victoria
and her brothers Reynaldo and Domingo questioning the authority of their elder sibling Rodrigo Reyes and Emerenciana R. Gungab, as well as the Anaped
Board of Directors and officers, including private complainant Buban to act for and in behalf of the corporation.5chanrobleslaw
In their motion to suspend proceedings, respondents asserted that the resolution of the SEC cases in their favor particularly the issues of whether of the group
of Rodrigo and Buban are the lawful representatives of the corporation and whether they are duly authorized to make a demand for remittance would
necessarily result in their acquittal in the criminal case.
On 28 August 2003, the trial court, through Presiding Judge Adoracion G. Angeles, granted the motion for suspension of the proceedings. The trial court
reasoned that the issue in the SEC cases, i.e., who between the groups has the right to act for and in behalf of the corporation, has a direct link to the issue
of the culpability of the accused for estafa, thus:chanRoblesvirtualLawlibrary
236
For indeed, if the aforesaid issues are resolved in the [respondents] favor, they cannot be held liable for misappropriation for they possess the authority to
collect rentals and hold the same on behalf of the firm. They would then be justified in not remitting the collections to the group of Jose Buban who would be
then deemed as mere usurpers of authority.6
Acting on the Motion for Reconsideration filed by petitioner, the trial court issued an Order dated 19 February 2004 setting aside its 28 August 2003 Order
and setting the case for pre-trial. The trial court noted that respondents failed to file an opposition to the motion for reconsideration.
Respondents filed an Omnibus Motion praying that they be allowed to file their Comment/Opposition to the motion for reconsideration and that the pre-trial
be held in abeyance. Respondents claimed that the Order of the trial court to file comment/opposition was served on respondents themselves and not on their
counsel.
On 23 June 2004, the trial court denied respondents Omnibus Motion. The trial court stressed that even if the order was served upon respondents and not
upon their counsel, records show that a copy of the motion for reconsideration was served by registered mail upon counsel. Thus, the trial court stated that
respondents counsel was well aware of the existence of the motion for reconsideration, thus he could have taken the initiative to file his comment thereto
without waiting for any directive from the court.
Aggrieved, respondents filed a petition for certiorari before the Court of Appeals asserting that the trial court committed grave abuse of discretion when it
denied them the opportunity to file their comment; when it ruled that respondents counsel should have filed the comment as he was furnished a copy of the
motion for reconsideration; and when it granted petitioners motion for reconsideration.
On 5 February 2008, the Court of Appeals granted the petition. The dispositive portion reads:chanRoblesvirtualLawlibrary
WHEREFORE, the assailed Orders of the respondent Judge dated February 19, 2004 and July 23, 2004 are REVERSED and SET ASIDE and she is hereby
enjoined from hearing the Criminal Case No. C-62784 until the termination of the SEC Case No. 03-99-6259. The August 28, 2003 Order of the respondent
Judge is hereby REINSTATED.7
Preliminarily, on the procedural question, the Court of Appeals pointed out that respondents were given the opportunity to present their side in their motion to
suspend proceedings. The appellate court treated respondents arguments in said motion as their Comment/Opposition to the Motion for Reconsideration
filed by petitioner. That is correct.
The appellate court ruled that in SEC Case No. 03-99-6259:chanRoblesvirtualLawlibrary

[T]he issue is the legality of the election of Anaped Board of Directors, as well as the authority of its officers, which include private complainant Jose Buban,
to act for and in behalf of the corporation. Clearly, it involves facts that are intimately related to those upon which the criminal case is based. The resolution
of the issues raised in this intra-corporate dispute will ultimately determine the guilt or innocence of [respondents] in the crime of estafa initiated by Jose
Buban. It must be remembered that one of the elements of the crime of estafa with abuse of confidence under paragraph 1 (b) of Article 315 of the Revised
Penal Code is a demand made by the offended party to the offender. A valid demand must therefore be made by an offended party to the offender.8
The appellate court added that since respondents are challenging the authority of Buban, then the validity of Bubans demand to turn over or remit the rentals
is put in question. The appellate court concluded that if the supposed authority of Buban is found to be defective, it is as if no demand was ever made, hence
the prosecution for estafa cannot prosper.
Petitioner filed a motion for reconsideration but it was denied in a Resolution dated 27 February 2009.
237
In this petition for review on certiorari, petitioner raises the lone ground of whether the Court of Appeals erred in declaring that there exists a prejudicial
question which calls for the suspension of the criminal proceedings before the trial court.
Petitioner argues that any decision of the trial court in the SEC cases with respect to the question of who are the lawful officers or directors of Anaped is not
determinative of the liability of respondents to remit the rental collections in favor of Anaped. Petitioner proffers that a corporation has a personality distinct
and separate from its individual stockholders. Petitioner emphasizes that at the time the demand for remittance of the rental collections was made against
respondents, Buban was an officer of Anaped and until such time that his authority is validly revoked, all his previous acts are valid and binding. Moreover,
petitioner avers that the duty of respondents to remit the collection still subsists even during the pendency of the SEC cases as the money remitted goes
directly to the corporation and not to the person who demanded the remittance. Finally, petitioner opines that question pertaining to the authority of Buban to
demand remittance may only be considered as a defense in the estafa case and not as a ground to suspend the proceedings.
A prejudicial question is one that arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which
pertains to another tribunal. It is a question based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt
or innocence of the accused, and for it to suspend the criminal action, it must appear not only that said case involves facts intimately related to those upon
which the criminal prosecution would be based but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of the accused
would necessarily be determined.9chanrobleslaw
Section 7, Rule 111 of the 2000 Rules of Criminal Procedure prescribes the elements that must concur in order for a civil case to be considered a prejudicial
question, to wit:chanRoblesvirtualLawlibrary
Section 7. Elements of prejudicial question. The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or
proceed.chanroblesvirtuallawlibrary
Aptly put, the following requisites must be present for a civil action to be considered prejudicial to a criminal case as to cause the suspension of the criminal
proceedings until the final resolution of the civil case: (1) the civil case involves facts intimately related to those upon which the criminal prosecution would be
based; (2) in the resolution of the issue or issues raised in the civil action, the guilt or innocence of the accused would necessarily be determined; and (3)
jurisdiction to try said question must be lodged in another tribunal.10chanrobleslaw
As correctly stated by the Court of Appeals, SEC Case No. 05-97-5659 does not present a prejudicial question to the criminal case for estafa. It is an action
for accounting of all corporate funds and assets of Anaped, annulment of sale, injunction, receivership and damages. Even if said case will be decided against
respondents, they will not be adjudged free from criminal liability. It also does not automatically follow that an accounting of corporate funds and properties
and annulment of fictitious sale of corporate assets would result in the conviction of respondents in the estafa case.
With respect to SEC Case No. 03-99-6259, however, we affirm the Court of Appeals finding that a prejudicial question exists. The Complaint in SEC Case
No. 03-99-6259 prays for the nullification of the election of Anaped directors and officers, including Buban. Essentially, the issue is the authority of the aforesaid
officers to act for and behalf of the corporation.
238
On the other hand, the issue in the criminal case pertains to whether respondents committed estafa. Under Article 315, paragraph 1(b) of the RPC, the
elements of estafa with abuse of confidence are as follows: (1) that the money, goods or other personal property is received by the offender in trust or on
commission, or for administration, or under any other obligation involving the duty to make delivery of, or to return, the same; (2) that there be misappropriation
or conversion of such money or property by the offender, or denial on his part of such receipt; (3) that such misappropriation or conversion or denial is to the
prejudice of another; and (4) that there is demand by the offended party to the offender.11chanrobleslaw
The elements of demand and misappropriation bear relevance to the validity or invalidity of the authority of Anaped directors and officers. In Omictin v. Court
of Appeals,12 we held that since the alleged offended party is the corporation, the validity of the demand for the delivery rests upon the authority of the person
making such a demand on the companys behalf. If the supposed authority of the person making the demand is found to be defective, it is as if no demand
was ever made, hence the prosecution for estafa cannot prosper. The Court added that mere failure to return the thing received for administration or under
any other obligation involving the duty to deliver or return the same or deliver the value thereof to the owner could only give rise to a civil action and does not
constitute the crime of estafa.13chanrobleslaw
It is true that the accused may be convicted of the felony under Article 315, paragraph 1(b) of the Revised Penal Code if the prosecution proves
misappropriation or conversion by the accused of the money or property subject of the Information. In a prosecution for estafa, demand is not necessary
where there is evidence of misappropriation or conversion.14 The phrase, to misappropriate to ones own use has been said to include not only conversion
to ones personal advantage, but also every attempt to dispose of the property of another without right.15 In this case, the resolution of the issue of
misappropriation by respondents depends upon the result of SEC Case No. 03-99-6259. If it is ruled in the SEC case that the present Anaped directors and
officers were not validly elected, then respondent Victoria may have every right to refuse remittance of rental to Buban. Hence, the essential element of
misappropriation in estafa may be absent in this case.
In this connection, we find important the fact, noted by the CA, that:chanRoblesvirtualLawlibrary
It appears from the record of the case that Victoria Arambulo for the last twenty (20) years had been tasked with the management and collection of rentals of
the real properties the Reyes siblings inherited from their parents, Ana and Pedro Reyes.16
As earlier mentioned, SEC Case No. 03-99-6259 is a petition filed by Victoria and her brothers Domingo and Reynaldo questioning the very authority of their
elder siblings Rodrigo and Emerenciana, as well as the Anaped Board of Directors and Officers, including Buban to act for and in behalf of the corporation.
We find this issue consonant with the provisions of the Corporation Code which provides in Section 23 that:chanRoblesvirtualLawlibrary
Sec. 23. The Board of Directors or Trustees. - Unless otherwise provided in this Code, the corporate powers of all corporations formed under this Code shall
be exercised, all business conducted and all property of such corporations controlled and held by the board of directors or trustees to be elected from among
the holders of stocks, or where there is no stock, from among the members of the corporation, who shall hold office for one (1) year and until their successors
are elected and qualified.chanroblesvirtuallawlibrary
In Valle Verde Country Club, Inc. v. Africa,17 we said that:chanRoblesvirtualLawlibrary
The underlying policy of the Corporation Code is that the business and affairs of the corporation must be governed by a board of directors whose members
have stood for election, and who have actually been elected by the stockholders, on an annual basis. Only in that way can the directors continued
accountability to shareholders, and the legitimacy of their decisions that bind the corporations stockholders, be assured. The shareholder vote is critical to
the theory that legitimizes the exercise of power by the directors or officers over properties that they do not own.chanroblesvirtuallawlibrary
239
From the foregoing, it is clear that, should respondents herein prevail in SEC Case No. 03-99-6259, then Buban, who does not own either by himself or in
behalf of Anaped which is the owner, the property heretofore managed by Victoria, cannot demand remittance of the rentals on the property and Victoria does
not have the obligation to turn over the rentals to Buban.
Verily, the result of SEC Case No. 03-99-6259 will determine the innocence or guilt of respondents in the criminal case for estafa.
WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated 5 February 2008 and 27 February 2009 enjoining the
Regional Trial Court of Caloocan City, Branch 121 from hearing Criminal Case No. C-62784 until the termination of SEC Case No. 03-99-6259, are AFFIRMED.
SO ORDERED.cralawlawlibrary
QUIMIGUING VS ICAO 1970
Appeal on points of law from an order of the Court of First Instance of Zamboanga del Norte (Judge Onofre Sison Abalos, presiding), in its Civil Case No.
1590, dismissing a complaint for support and damages, and another order denying amendment of the same pleading.
The events in the court of origin can be summarized as follows:
Appellant, Carmen Quimiguing, assisted by her parents, sued Felix Icao in the court below. In her complaint it was averred that the parties were neighbors in
Dapitan City, and had close and confidential relations; that defendant Icao, although married, succeeded in having carnal intercourse with plaintiff several
times by force and intimidation, and without her consent; that as a result she became pregnant, despite efforts and drugs supplied by defendant, and plaintiff
had to stop studying. Hence, she claimed support at P120.00 per month, damages and attorney's fees.
Duly summoned, defendant Icao moved to dismiss for lack of cause of action since the complaint did not allege that the child had been born; and after hearing
arguments, the trial judge sustained defendant's motion and dismissed the complaint.
Thereafter, plaintiff moved to amend the complaint to allege that as a result of the intercourse, plaintiff had later given birth to a baby girl; but the court,
sustaining defendant's objection, ruled that no amendment was allowable, since the original complaint averred no cause of action. Wherefore, the plaintiff
appealed directly to this Court.
We find the appealed orders of the court below to be untenable. A conceived child, although as yet unborn, is given by law a provisional personality of its own
for all purposes favorable to it, as explicitly provided in Article 40 of the Civil Code of the Philippines. The unborn child, therefore, has a right to support from
its progenitors, particularly of the defendant-appellee (whose paternity is deemed admitted for the purpose of the motion to dismiss), even if the said child is
only "en ventre de sa mere;" just as a conceived child, even if as yet unborn, may receive donations as prescribed by Article 742 of the same Code, and its
being ignored by the parent in his testament may result in preterition of a forced heir that annuls the institution of the testamentary heir, even if such child
should be born after the death of the testator Article 854, Civil Code).
240
ART. 742. Donations made to conceived and unborn children may be accepted by those persons who would legally represent them if they were already born.
ART. 854. The preterition or omission of one, some, or all of the compulsory heirs in the direct line, whether living at the time of the execution of the will or
born after the death of the testator, shall annul the institution of heir; but the devises and legacies shall be valid insofar as they are not inofficious.
If the omitted compulsory heirs should die before the testator, the institution shall be effectual, without prejudice to the right of 'representation.
It is thus clear that the lower court's theory that Article 291 of the Civil Code declaring that support is an obligation of parents and illegitimate children "does
not contemplate support to children as yet unborn," violates Article 40 aforesaid, besides imposing a condition that nowhere appears in the text of Article 291.
It is true that Article 40 prescribing that "the conceived child shall be considered born for all purposes that are favorable to it" adds further "provided it be born
later with the conditions specified in the following article" (i.e., that the foetus be alive at the time it is completely delivered from the mother's womb). This
proviso, however, is not a condition precedent to the right of the conceived child; for if it were, the first part of Article 40 would become entirely useless and
ineffective. Manresa, in his Commentaries (5th Ed.) to the corresponding Article 29 of the Spanish Civil Code, clearly points this out:
Los derechos atribuidos al nasciturus no son simples expectativas, ni aun en el sentido tecnico que la moderna doctrina da a esta figura juridica sino que
constituyen un caso de los propiamente Ilamados 'derechos en estado de pendenci'; el nacimiento del sujeto en las condiciones previstas por el art. 30, no
determina el nacimiento de aquellos derechos (que ya existian de antemano), sino que se trata de un hecho que tiene efectos declarativos.
A second reason for reversing the orders appealed from is that for a married man to force a woman not his wife to yield to his lust (as averred in the original
complaint in this case) constitutes a clear violation of the rights of his victim that entitles her to claim compensation for the damage caused. Says Article 21 of
the Civil Code of the Philippines:
ART. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the
latter for the damage.
The rule of Article 21 is supported by Article 2219 of the same Code:
ART 2219. Moral damages may be recovered in the following and analogous cases:
(3) Seduction, abduction, rape or other lascivious acts:

(10) Acts and actions referred to in Articles 21, 26, 27, 28 ....
Thus, independently of the right to Support of the child she was carrying, plaintiff herself had a cause of action for damages under the terms of the complaint;
and the order dismissing it for failure to state a cause of action was doubly in error.
WHEREFORE, the orders under appeal are reversed and set aside. Let the case be remanded to the court of origin for further proceedings conformable to
this decision. Costs against appellee Felix Icao. So ordered.
241
CONTINENTAL STEEL VS MONTANO 2009
Before Us is a Petition for Review on Certiorari, under Rule 45 of the Rules of Court, assailing the Decision1 dated 27 February 2008 and the Resolution2
dated 9 May 2008 of the Court of Appeals in CA-G.R. SP No. 101697, affirming the Resolution3 dated 20 November 2007 of respondent Accredited Voluntary
Arbitrator Atty. Allan S. Montao (Montao) granting bereavement leave and other death benefits to Rolando P. Hortillano (Hortillano), grounded on the death
of his unborn child.
The antecedent facts of the case are as follows:
Hortillano, an employee of petitioner Continental Steel Manufacturing Corporation (Continental Steel) and a member of respondent Nagkakaisang
Manggagawa ng Centro Steel Corporation-Solidarity of Trade Unions in the Philippines for Empowerment and Reforms (Union) filed on 9 January 2006, a
claim for Paternity Leave, Bereavement Leave and Death and Accident Insurance for dependent, pursuant to the Collective Bargaining Agreement (CBA)
concluded between Continental and the Union, which reads:
ARTICLE X: LEAVE OF ABSENCE

xxxx
Section 2. BEREAVEMENT LEAVEThe Company agrees to grant a bereavement leave with pay to any employee in case of death of the employees
legitimate dependent (parents, spouse, children, brothers and sisters) based on the following:
2.1 Within Metro Manila up to Marilao, Bulacan - 7 days
2.2 Provincial/Outside Metro Manila - 11 days
xxxx
ARTICLE XVIII: OTHER BENEFITS
xxxx
Section 4. DEATH AND ACCIDENT INSURANCEThe Company shall grant death and accidental insurance to the employee or his family in the following
manner:
xxxx
4.3 DEPENDENTSEleven Thousand Five Hundred Fifty Pesos (Php11,550.00) in case of death of the employees legitimate dependents (parents, spouse,
and children). In case the employee is single, this benefit covers the legitimate parents, brothers and sisters only with proper legal document to be presented
(e.g. death certificate).4
The claim was based on the death of Hortillanos unborn child. Hortillanos wife, Marife V. Hortillano, had a premature delivery on 5 January 2006 while she
was in the 38th week of pregnancy.5 According to the Certificate of Fetal Death dated 7 January 2006, the female fetus died during labor due to fetal Anoxia
secondary to uteroplacental insufficiency.6
Continental Steel immediately granted Hortillanos claim for paternity leave but denied his claims for bereavement leave and other death benefits, consisting
of the death and accident insurance.7
242
Seeking the reversal of the denial by Continental Steel of Hortillanos claims for bereavement and other death benefits, the Union resorted to the grievance
machinery provided in the CBA. Despite the series of conferences held, the parties still failed to settle their dispute,8 prompting the Union to file a Notice to
Arbitrate before the National Conciliation and Mediation Board (NCMB) of the Department of Labor and Employment (DOLE), National Capital Region (NCR).9
In a Submission Agreement dated 9 October 2006, the Union and Continental Steel submitted for voluntary arbitration the sole issue of whether Hortillano
was entitled to bereavement leave and other death benefits pursuant to Article X, Section 2
and Article XVIII, Section 4.3 of the CBA.10 The parties mutually chose Atty. Montao, an Accredited Voluntary Arbitrator, to resolve said issue.11
When the preliminary conferences again proved futile in amicably settling the dispute, the parties proceeded to submit their respective Position Papers, 12
Replies,13 and Rejoinders14 to Atty. Montao.
The Union argued that Hortillano was entitled to bereavement leave and other death benefits pursuant to the CBA. The Union maintained that Article X,
Section 2 and Article XVIII, Section 4.3 of the CBA did not specifically state that the dependent should have first been born alive or must have acquired
juridical personality so that his/her subsequent death could be covered by the CBA death benefits. The Union cited cases wherein employees of MKK Steel
Corporation (MKK Steel) and Mayer Steel Pipe Corporation (Mayer Steel), sister companies of Continental Steel, in similar situations as Hortillano were able
to receive death benefits under similar provisions of their CBAs.
The Union mentioned in particular the case of Steve L. Dugan (Dugan), an employee of Mayer Steel, whose wife also prematurely delivered a fetus, which
had already died prior to the delivery. Dugan was able to receive paternity leave, bereavement leave, and voluntary contribution under the CBA between his
union and Mayer Steel.15 Dugans child was only 24 weeks in the womb and died before labor, as opposed to Hortillanos child who was already 37-38 weeks
in the womb and only died during labor.
The Union called attention to the fact that MKK Steel and Mayer Steel are located in the same compound as Continental Steel; and the representatives of
MKK Steel and Mayer Steel who signed the CBA with their respective employees unions were the same as the representatives of Continental Steel who
signed the existing CBA with the Union.
Finally, the Union invoked Article 1702 of the Civil Code, which provides that all doubts in labor legislations and labor contracts shall be construed in favor of
the safety of and decent living for the laborer.
On the other hand, Continental Steel posited that the express provision of the CBA did not contemplate the death of an unborn child, a fetus, without legal
personality. It claimed that there are two elements for the entitlement to the benefits, namely: (1) death and (2) status as legitimate dependent, none of which
existed in Hortillanos case. Continental Steel, relying on Articles 40, 41 and 4216 of the Civil Code, contended that only one with civil personality could die.
Hence, the unborn child never died because it never acquired juridical personality. Proceeding from the same line of thought, Continental Steel reasoned that
a fetus that was dead from the moment of delivery was not a person at all. Hence, the term dependent could not be applied to a fetus that never acquired
juridical personality. A fetus that was delivered dead could not be considered a dependent, since it never needed any support, nor did it ever acquire the right
to be supported.
243
Continental Steel maintained that the wording of the CBA was clear and unambiguous. Since neither of the parties qualified the terms used in the CBA, the
legally accepted definitions thereof were deemed automatically accepted by both parties. The failure of the Union to have unborn child included in the definition
of dependent, as used in the CBA the death of whom would have qualified the parent-employee for bereavement leave and other death benefits bound
the Union to the legally accepted definition of the latter term.
Continental Steel, lastly, averred that similar cases involving the employees of its sister companies, MKK Steel and Mayer Steel, referred toby the Union,
were irrelevant and incompetent evidence, given the separate and distinct personalities of the companies. Neither could the Union sustain its claim that the
grant of bereavement leave and other death benefits to the parent-employee for the loss of an unborn child constituted "company practice."
On 20 November 2007, Atty. Montao, the appointed Accredited Voluntary Arbitrator, issued a Resolution17 ruling that Hortillano was entitled to bereavement
leave with pay and death benefits.
Atty. Montao identified the elements for entitlement to said benefits, thus:
This Office declares that for the entitlement of the benefit of bereavement leave with pay by the covered employees as provided under Article X, Section 2 of
the parties CBA, three (3) indispensable elements must be present: (1) there is "death"; (2) such death must be of employees "dependent"; and (3) such
dependent must be "legitimate".
On the otherhand, for the entitlement to benefit for death and accident insurance as provided under Article XVIII, Section 4, paragraph (4.3) of the parties
CBA, four (4) indispensable elements must be present: (a) there is "death"; (b) such death must be of employees "dependent"; (c) such dependent must be
"legitimate"; and (d) proper legal document to be presented.18
Atty. Montao found that there was no dispute that the death of an employees legitimate dependent occurred. The fetus had the right to be supported by the
parents from the very moment he/she was conceived. The fetus had to rely on another for support; he/she could not have existed or sustained himself/herself
without the power or aid of someone else, specifically, his/her mother. Therefore, the fetus was already a dependent, although he/she died during the labor
or delivery. There was also no question that Hortillano and his wife were lawfully married, making their dependent, unborn child, legitimate.
In the end, Atty. Montao decreed:
WHEREFORE, premises considered, a resolution is hereby rendered ORDERING [herein petitioner Continental Steel] to pay Rolando P. Hortillano the amount
of Four Thousand Nine Hundred Thirty-Nine Pesos (P4,939.00), representing his bereavement leave pay and the amount of Eleven Thousand Five Hundred
Fifty Pesos (P11,550.00) representing death benefits, or a total amount of P16,489.00
The complaint against Manuel Sy, however, is ORDERED DISMISSED for lack of merit.
All other claims are DISMISSED for lack of merit.
Further, parties are hereby ORDERED to faithfully abide with the herein dispositions.
244
Aggrieved, Continental Steel filed with the Court of Appeals a Petition for Review on Certiorari,19 under Section 1, Rule 43 of the Rules of Court, docketed
as CA-G.R. SP No. 101697.
Continental Steel claimed that Atty. Montao erred in granting Hortillanos claims for bereavement leave with pay and other death benefits because no death
of an employees dependent had occurred. The death of a fetus, at whatever stage of pregnancy, was excluded from the coverage of the CBA since what
was contemplated by the CBA was the death of a legal person, and not that of a fetus, which did not acquire any juridical personality. Continental Steel pointed
out that its contention was bolstered by the fact that the term death was qualified by the phrase legitimate dependent. It asserted that the status of a child
could only be determined upon said childs birth, otherwise, no such appellation can be had. Hence, the conditions sine qua non for Hortillanos entitlement
to bereavement leave and other death benefits under the CBA were lacking.
The Court of Appeals, in its Decision dated 27 February 2008, affirmed Atty. Montaos Resolution dated 20 November 2007. The appellate court interpreted
death to mean as follows:
[Herein petitioner Continental Steels] exposition on the legal sense in which the term "death" is used in the CBA fails to impress the Court, and the same is
irrelevant for ascertaining the purpose, which the grant of bereavement leave and death benefits thereunder, is intended to serve. While there is no arguing
with [Continental Steel] that the acquisition of civil personality of a child or fetus is conditioned on being born alive upon delivery, it does not follow that such
event of premature delivery of a fetus could never be contemplated as a "death" as to be covered by the CBA provision, undoubtedly an event causing loss
and grief to the affected employee, with whom the dead fetus stands in a legitimate relation. [Continental Steel] has proposed a narrow and technical
significance to the term "death of a legitimate dependent" as condition for granting bereavement leave and death benefits under the CBA. Following
[Continental Steels] theory, there can be no experience of "death" to speak of. The Court, however, does not share this view. A dead fetus simply cannot be
equated with anything less than "loss of human life", especially for the expectant parents. In this light, bereavement leave and death benefits are meant to
assuage the employee and the latters immediate family, extend to them solace and support, rather than an act conferring legal status or personality upon the
unborn child. [Continental Steels] insistence that the certificate of fetal death is for statistical purposes only sadly misses this crucial point.20
Accordingly, the fallo of the 27 February 2008 Decision of the Court of Appeals reads:
WHEREFORE, premises considered, the present petition is hereby DENIED for lack of merit. The assailed Resolution dated November 20, 2007 of Accredited
Voluntary Arbitrator Atty. Allan S. Montao is hereby AFFIRMED and UPHELD.
With costs against [herein petitioner Continental Steel].21
In a Resolution22 dated 9 May 2008, the Court of Appeals denied the Motion for Reconsideration23 of Continental Steel.
Hence, this Petition, in which Continental Steel persistently argues that the CBA is clear and unambiguous, so that the literal and legal meaning of death
should be applied. Only one with juridical personality can die and a dead fetus never acquired a juridical personality.
245
As Atty. Montao identified, the elements for bereavement leave under Article X, Section 2 of the CBA are: (1) death; (2) the death must be of a dependent,
i.e., parent, spouse, child, brother, or sister, of an employee; and (3) legitimate relations of the dependent to the employee. The requisites for death and
accident insurance under Article XVIII, Section 4(3) of the CBA are: (1) death; (2) the death must be of a dependent, who could be a parent, spouse, or child
of a married employee; or a parent, brother, or sister of a single employee; and (4) presentation of the proper legal document to prove such death, e.g., death
certificate.
It is worthy to note that despite the repeated assertion of Continental Steel that the provisions of the CBA are clear and unambiguous, its fundamental
argument for denying Hortillanos claim for bereavement leave and other death benefits rests on the purportedly proper interpretation of the terms "death" and
"dependent" as used in the CBA. If the provisions of the CBA are indeed clear and unambiguous, then there is no need to resort to the interpretation or
construction of the same. Moreover, Continental Steel itself admitted that neither management nor the Union sought to define the pertinent terms for
bereavement leave and other death benefits during the negotiation of the CBA.
The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code for the legal definition of death is misplaced. Article 40 provides that a conceived
child acquires personality only when it is born, and Article 41 defines when a child is considered born. Article 42 plainly states that civil personality is
extinguished by death.
First, the issue of civil personality is not relevant herein. Articles 40, 41 and 42 of the Civil Code on natural persons, must be applied in relation to Article 37
of the same Code, the very first of the general provisions on civil personality, which reads:
Art. 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person and is lost only through death. Capacity
to act, which is the power to do acts with legal effect, is acquired and may be lost.
We need not establish civil personality of the unborn child herein since his/her juridical capacity and capacity to act as a person are not in issue. It is not a
question before us whether the unborn child acquired any rights or incurred any obligations prior to his/her death that were passed on to or assumed by the
childs parents. The rights to bereavement leave and other death benefits in the instant case pertain directly to the parents of the unborn child upon the latters
death.
Second, Sections 40, 41 and 42 of the Civil Code do not provide at all a definition of death. Moreover, while the Civil Code expressly provides that civil
personality may be extinguished by death, it does not explicitly state that only those who have acquired juridical personality could die.
And third, death has been defined as the cessation of life.24 Life is not synonymous with civil personality. One need not acquire civil personality first before
he/she could die. Even a child inside the womb already has life. No less than the Constitution recognizes the life of the unborn from conception,25 that the
State must protect equally with the life of the mother. If the unborn already has life, then the cessation thereof even prior to the child being delivered, qualifies
as death.
Likewise, the unborn child can be considered a dependent under the CBA. As Continental Steel itself defines, a dependent is "one who relies on another for
support; one not able to exist or sustain oneself without the power or aid of someone else." Under said general definition,26 even an unborn child is a
246
dependent of its parents. Hortillanos child could not have reached 38-39 weeks of its gestational life without depending upon its mother, Hortillanos wife, for
sustenance. Additionally, it is explicit in the CBA provisions in question that the dependent may be the parent, spouse, or child of a married employee; or the
parent, brother, or sister of a single employee. The CBA did not provide a qualification for the child dependent, such that the child must have been born or
must have acquired civil personality, as Continental Steel avers. Without such qualification, then child shall be understood in its more general sense, which
includes the unborn fetus in the mothers womb.
The term legitimate merely addresses the dependent childs status in relation to his/her parents. In Angeles v. Maglaya,27 we have expounded on who is a
legitimate child, viz:
A legitimate child is a product of, and, therefore, implies a valid and lawful marriage. Remove the element of lawful union and there is strictly no legitimate
filiation between parents and child. Article 164 of the Family Code cannot be more emphatic on the matter: "Children conceived or born during the marriage
of the parents are legitimate." (Emphasis ours.)
Conversely, in Briones v. Miguel,28 we identified an illegitimate child to be as follows:
The fine distinctions among the various types of illegitimate children have been eliminated in the Family Code. Now, there are only two classes of children --
legitimate (and those who, like the legally adopted, have the rights of legitimate children) and illegitimate. All children conceived and born outside a valid
marriage are illegitimate, unless the law itself gives them legitimate status. (Emphasis ours.)
It is apparent that according to the Family Code and the afore-cited jurisprudence, the legitimacy or illegitimacy of a child attaches upon his/her conception.
In the present case, it was not disputed that Hortillano and his wife were validly married and that their child was conceived during said marriage, hence,
making said child legitimate upon her conception.1avvphi1
Also incontestable is the fact that Hortillano was able to comply with the fourth element entitling him to death and accident insurance under the CBA, i.e.,
presentation of the death certificate of his unborn child.
Given the existence of all the requisites for bereavement leave and other death benefits under the CBA, Hortillanos claims for the same should have been
granted by Continental Steel.
We emphasize that bereavement leave and other death benefits are granted to an employee to give aid to, and if possible, lessen the grief of, the said
employee and his family who suffered the loss of a loved one. It cannot be said that the parents grief and sense of loss arising from the death of their unborn
child, who, in this case, had a gestational life of 38-39 weeks but died during delivery, is any less than that of parents whose child was born alive but died
subsequently.
Being for the benefit of the employee, CBA provisions on bereavement leave and other death benefits should be interpreted liberally to give life to the intentions
thereof. Time and again, the Labor Code is specific in enunciating that in case of doubt in the interpretation of any law or provision affecting labor, such should
be interpreted in favor of labor.29 In the same way, the CBA and CBA provisions should be interpreted in favor of labor. In Marcopper Mining v. National
Labor Relations Commission,30 we pronounced:
247
Finally, petitioner misinterprets the declaration of the Labor Arbiter in the assailed decision that "when the pendulum of judgment swings to and fro and the
forces are equal on both sides, the same must be stilled in favor of labor." While petitioner acknowledges that all doubts in the interpretation of the Labor
Code shall be resolved in favor of labor, it insists that what is involved-here is the amended CBA which is essentially a contract between private persons.
What petitioner has lost sight of is the avowed policy of the State, enshrined in our Constitution, to accord utmost protection and justice to labor, a policy, we
are, likewise, sworn to uphold.
In Philippine Telegraph & Telephone Corporation v. NLRC [183 SCRA 451 (1990)], we categorically stated that:
When conflicting interests of labor and capital are to be weighed on the scales of social justice, the heavier influence of the latter should be counter-balanced
by sympathy and compassion the law must accord the underprivileged worker.
Likewise, in Terminal Facilities and Services Corporation v. NLRC [199 SCRA 265 (1991)], we declared:
Any doubt concerning the rights of labor should be resolved in its favor pursuant to the social justice policy.
IN VIEW WHEREOF, the Petition is DENIED.
SO ORDERED.
248

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TANADA VS TUVERA 1985

Specifically, the publication of the following presidential issuances is sought:

DE ROY VS RAMOS 1988

ATIENZA VS BRILLANTES JR.

CARLOS VS SANDOVAL 2008

On April 8, 1996, the RTC rendered judgment, disposing as follows:

SEC. 13. Effect of failure to appear at the pre-trial. (a) x x x

SEC. 2. Petition for declaration of absolute nullity of void marriages.

The antecedents are as follows

Section 1. Institution of criminal and civil actions.

CAROLINO VS SENGA 2015

The factual and legal antecedents are as follows:

Petitioner filed her reply thereto. We find merit in the petition.

In Ayog v. Cusi,26 we expounded the nature of a vested right, thus:

The antecedent facts are as follows:

The petition lacks merit.

The facts are as follows:

The petition lacks merit.

SILVERIO VS REPUBLIC 2007

The [c]ourt rules in the affirmative.

The petition lacks merit.

A Persons First Name Cannot Be Changed On the Ground of Sex Reassignment

Section 2(c) of RA 9048 defines what a "clerical or typographical error" is:

xxx xxx xxx

ART. 408. The following shall be entered in the civil register:

Moreover, Section 5 of Act 3753 (the Civil Register Law) provides:

xxx xxx xxx

WHEREFORE, the petition is hereby DENIED.

Costs against petitioner.

DEL SOCORRO VS VAN WILSEM 2014

The following facts are culled from the records:

Cebu City, Philippines, February 19, 2010.

Cebu City, Philippines, September 1, 2010.26

In the case of Vivo v. Cloribel,38 the Court held that

Section 4, Rule 2 of the 1997 Rules of Civil Procedure is pertinent

PILAPIL VS IBAY SOMERA 1989

RECIO VS RECIO 2001

The assailed Order denied reconsideration of the above-quoted Decision.

Ruling of the Trial Court

Hence, this Petition.[18]

Petitioner submits the following issues for our consideration:

The Courts Ruling

The Petition is partly meritorious.

Divorce as a Question of Fact

Burden of Proving Australian Law

Second Issue: Respondents Legal Capacity to Remarry

Significance of the Certificate of Legal Capacity

ELMAR PEREZ VS CA 2006

The petition lacks merit.

SAN LUIS VS SAN LUIS 2007

The petition lacks merit.

Brief Historical Background

LAVADIA VS HEIRS OF LUNA 2014

The antecedent facts were summarized by the CA as follows:

Ruling of the RTC

WHEREFORE, judgment is rendered as follows:

Both parties appealed to the CA.6

We affirm the modified decision of the CA.

1. Atty. Lunas first marriage with Eugenia

2. The Agreement for Separation and Property Settlement

The insistence of the petitioner was unwarranted.

Article 175. The conjugal partnership of gains terminates: