Topic: RULE 7

Lorbes v. Court of Appeals, G.R. No. 139884, February 15, 2000

This petition for review on certiorari arose from an action for reformation of instrument and damages
originally filed with the Regional Trial Court of Antipolo, Rizal, Branch 74, the decision on which was
reviewed and reversed by the Third Division of the Court of Appeals. Furthermore, Supreme Court
reversed the CA and upheld lower RTCs decision.

FACTS:

Petitioners were the registered owners of a 225-square meter parcel of land located in Antipolo, Rizal and
the same property was mortgaged to Florencio and Nestor Carlos in the amount of P150,000.00.
About a year later, the mortgage obligation had increased to P500,000.00 and fearing foreclosure of the
property, petitioners asked their son-in-law, herein private respondent Ricardo delos Reyes, for help in
redeeming their property. Private respondent delos Reyes agreed to redeem the property but because
he allegedly had no money then for the purpose he solicited the assistance of private respondent
Josefina Cruz, a family friend of the delos Reyeses and an employee of the Land Bank of the Philippines.

It was agreed that petitioners will sign a deed of sale conveying the mortgaged property in favor of private
respondent Cruz and thereafter, Cruz will apply for a housing loan with Land Bank, using the subject
property as collateral. It was further agreed that out of the proceeds of the loan, P500,000.00 will be paid
to the Carloses as mortgagees, and any such balance will be applied by petitioners for capital gains tax,
expenses for the cancellation of the mortgage to the Carloses, transfer of title to Josefina Cruz, and
registration of a mortgage in favor of Land Bank. Moreover, the monthly amortization on the housing loan
which was supposed to be deducted from the salary of private respondent Cruz will be reimbursed by
private respondent delos Reyes.

Eventually, Land Bank issued a letter of guarantee in favor of the Carloses, informing them that Cruzs
loan had been approved and Transfer Certificate of Title No. 165009 was cancelled and Transfer
Certificate of Title No. 229891 in the name of Josefina Cruz. The mortgage was discharged.

Now, sometime in 1993, petitioners notified private respondent delos Reyes that they were ready to
redeem the property but the offer was refused. Aggrieved, petitioners filed a complaint for reformation of
instrument and damages with the RTC of Antipolo, Rizal. Petitioner averred that the deed was merely a
formality to meet the requirements of the bank for the housing loan, and that the real intention of the
parties in securing the loan was to apply the proceeds thereof for the payment of the mortgage obligation.
Furthermore, they alleged that the deed of sale did not reflect the true intention of the parties, and that the
transaction was not an absolute sale but an equitable mortgage, considering that the price of the sale was
inadequate considering the market value of the subject property and because they continued paying the
real estate taxes thereto even after the execution of the said deed of sale.

The trial court rendered judgment in favor of petitioners. They decided that (1) the Deed of Absolute Sale
dated October 21, 1992 did not reflect the true intention of the parties, and (2) the transaction entered into
between petitioners and Cruz was not an absolute sale but an equitable mortgage, considering that the
price stated in the Deed of Absolute Sale was insufficient compared to the value of the property,
petitioners are still in possession of the property, and petitioners had continued to pay the real estate
taxes thereon after the execution of the said deed of sale.

CA reversed the above decision, finding that private respondents were denied due process by the refusal
of the trial court to lift the order of default against them, and that the transaction between petitioners and
Cruz was one of absolute sale, not of equitable mortgage. Also, the Court of Appeals found petitioners
action for reformation unmeritorious because there was no showing that the failure of the deed of sale to
express the parties true intention was because of mistake, fraud, inequitable conduct, or accident. It also
held the RTC decision to be constitutionally infirm for its failure to clearly and distinctly state the facts and
the law on which it is based. Thus, petitioner brought the case to Supreme Court.
ISSUE:

Whether the transaction between petitioners and Cruz was one of absolute sale or of equitable mortgage.

RULINGS:

The true arrangement between petitioners and private respondent Cruz was an equitable mortgage.

Based on the provision found under Article 1602 of the Civil Code, the Court finds that the true intention
between the parties for executing the Deed of Absolute Sale was not to convey ownership of the property
in question but merely to secure the housing loan of Cruz, in which petitioners had a direct interest since
the proceeds thereof were to be immediately applied to their outstanding mortgage obligation to the
Carloses.

Also, it will be recalled that the instant petition originated as a complaint for reformation filed before the
RTC of Antipolo, Rizal. The Court of Appeals found petitioners action for reformation unmeritorious
because there was no showing that the failure of the deed of sale to express the parties true intention
was because of mistake, fraud, inequitable conduct, or accident. Indeed, under the facts of the present
case, reformation may not be proper for failure to fully meet the requisites in Article 1359 of the Civil
Code, and because as the evidence eventually bore out the contested Deed of Absolute Sale was not
intended to reflect the true agreement between the parties but was merely to comply with the collateral
requirements of Land Bank. However, the fact that the complaint filed by petitioners before the trial court
was categorized to be one for reformation of instrument should not preclude the Court from passing upon
the issue of whether the transaction was in fact an equitable mortgage as the same has been squarely
raised in the complaint and had been the subject of arguments and evidence of the parties. Thus, SC
held that it is not the caption of the pleading but the allegations therein that determine the nature of the
action, and the Court shall grant relief warranted by the allegations and the proof even if no such relief is
prayed for.

DIONA VS. BALANGUE

On March 2, 1991, respondents obtained a loan of P45,000.00 from petitioner payable in six months and
secured by a Real Estate Mortgage over their 202-square meter property located in
Marulas, Valenzuela and covered by Transfer Certificate ofTitle (TCT) No. V-12296. When the debt
became due, respondents failed to pay notwithstanding demand.

BODY OF THE COMPLAINT

The RTC filed a Complaint praying that respondents be ordered:

(a)To pay [petitioner] the principal obligation of P45,000.00, with interest thereon at the rate of 12% per
annum, from 02 March 1991 until the full obligation is paid.

(b) To pay [petitioner] actual damages as may be proven during the trial but shall in no case be less than
P10,000.00; P25,000.00 by way of attorneys fee, plus P2,000.00 per hearing as appearance fee.

(c)To issue a decree of foreclosure for the sale at public auction of the aforementioned parcel of land, and
for the disposition of the proceeds [thereof] in accordance with law, upon failure of the
[respondents] to fully pay [petitioner] within the period set by law the sums set forth in this complaint.

(d) Costs of this suit.

Other reliefs and remedies just and equitable under the premises are likewise prayed for.

Respondents were served with summons thru respondent Sonny A. Balangue (Sonny)
Despite the requested extension, however, respondents failed to file any responsive pleadings. Thus,
upon motion of the petitioner, the RTC declared them in default and allowed petitioner to present her
evidence ex parte. The RTC granted petitioners Complaint and awarded a monthly interest of 5% per
annum. Respondents then filed a Motion to Correct/Amend Judgment and To Set Aside Execution Sale
dated December 17, 2001, claiming that the parties did not agree in writing on any rate of interest and
that petitioner merely sought for a 12% per annum interest in her Complaint. Surprisingly, the RTC
awarded 5% monthly interest (or 60% per annum) from March 2, 1991 until full payment. Resultantly, their
indebtedness inclusive of the exorbitant interest from March 2, 1991 to May 22, 2001 ballooned from
P124,400.00 to P652,000.00. In an Order dated May 7, 2002, the RTC granted respondents motion and
accordingly modified the interest rate awarded from 5% monthly to 12% per annum.

ISSUE:

Whether or not the Court can grant relief not prayed for in the complaint?

HELD:

NO.

It is settled that courts cannot grant a relief not prayed for in the pleadings or in excess of what is being
sought by the party. They cannot also grant a relief without first ascertaining the evidence presented in
support thereof. Due process considerations require thatjudgments must conform to and be supported by
the pleadings and evidence presented in court. In Development Bank of the Philippines v. Teston, this
Court expounded that:

Due process considerations justify this requirement. It is improper to enter an order which exceeds the
scope of relief sought by the pleadings, absent notice which affords the opposing party an opportunity to
be heard with respect to the proposed relief. The fundamental purpose of the requirement that
allegations of a complaint must provide the measure of recovery is to prevent surprise to the defendant.

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

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

The raison dtre in limiting the extent of relief that may be granted is that it cannot be presumed that the
defendant would not file an Answer and allow himself to be declared in default had he known that the
plaintiff will be accorded a relief greater than or different in kind from that sought in the Complaint.

No doubt, the reason behind Section 3(d), Rule 9 of the Rules of Court is to safeguard defendants right
to due process against unforeseen and arbitrarily issued judgment. This, to the mind of this Court, is akin
to the very essence of due process. It embodies the sporting idea of fair play and forbids the grant of
relief on matters where the defendant was not given the opportunity to be heard In the case at bench, the
award of 5% monthly interest rate is not supported both by the allegations in the pleadings and the
evidence on record. The Real Estate Mortgage executed by the parties does not include any provision on
interest. When petitioner filed her Complaint before the RTC, she alleged that respondents borrowed
from her the sum of FORTY-FIVE THOUSAND PESOS (P45,000.00), with interest thereon at the rate of
12% per annumand sought payment thereof. She did not allege or pray for the disputed 5% monthly
interest. Neither did she present evidence nor testified thereon. Clearly, the RTCs award of 5% monthly
interest or 60% per annum lacks basis and disregards due process. It violated the due process
requirement because respondents were not informed of the possibility that the RTC may award 5%
monthly interest. They were deprived of reasonable opportunity to refute and present controverting
evidence as they were made to believe that the complainant [petitioner] was seeking for what she merely
stated in her Complaint. Neither can the grant of the 5% monthly interest be considered subsumed by
petitioners general prayer for [o]ther reliefs and remedies just and equitable under the premises x x x.
To repeat, the courts grant of relief is limited only to what has been prayed for in the Complaint or related
thereto, supported by evidence, and covered by the partys cause of action. Besides, even assuming that
the awarded 5% monthly or 60% per annum interest was properly alleged and proven during trial, the
same remains unconscionably excessive and ought to be equitably reduced in accordance with
applicable jurisprudence. It is understandable for the respondents not to contest the default order for, as
alleged in their Comment, it is not their intention to impugn or run away from their just and valid
obligation. Nonetheless, their waiver to present evidence should never be construed as waiver to contest
patently erroneous award which already transgresses their right to due process, as well as applicable
jurisprudence.

PHIL CHARTER vs. PNC CORP

G.R. NO. 185066 OCTOBER 2, 2009

FACTS:

Philippine National Construction Corporation (PNCC) conducted a public bidding for the supply of labor,
materials, tools, supervision, equipment, and other incidentals necessary for the fabrication and delivery
of 27 tollbooths to be used for the automation of toll collection along the expressways. Orlando Kalingo
(Kalingo) won in the bidding and was awarded the contract. conducted a public bidding for the supply of
labor, materials, tools, supervision, equipment, and other incidentals necessary for the fabrication and
delivery of 27 tollbooths to be used for the automation of toll collection along the expressways. Orlando
Kalingo (Kalingo) won in the bidding and was awarded the contract.

On November 13, 1997, PNCC issued in favor of Kalingo Purchase Order (P.O.) No. 71024L for 25
units of tollbooths for a total of P2,100,000.00, and P.O. No. 71025L for two units of tollbooths amounting
to P168,000.00. These issuances were subject to the condition, among others, that each P.O. shall be
covered by a surety bond equivalent to 100% of the total down payment (50% of the total cost reflected
on the P.O.), and that the surety bond shall continue in full force until the supplier shall have complied
with all the undertakings and covenants to the full satisfaction of PNCC.

Kalingo, hence, posted surety bonds Surety Bond Nos. 27546 and 27547.

Both surety bonds contain the following conditions: (1) the liability of PCIC under the bonds expires on
March 16, 1998; and (2) a written extrajudicial demand must first be tendered to the surety, PCIC, within
15 days from the expiration date; otherwise PCIC shall not be liable thereunder and the obligee waives
the right to claim or file any court action to collect on the bond.

On March 3, 4, and 5, 1998, Kalingo made partial/initial delivery of four units of tollbooths under P.O. No.
71024L. However, the tollbooths delivered were incomplete or were not fabricated according to PNCC
specifications. Kalingo failed to deliver the other 23 tollbooths up to the time of filing of the complaint;
despite demands, he failed and refused to comply with his obligation under the POs.

On March 9, 1998, six days before the expiration of the surety bonds and after the expiration of the
delivery period provided for under the award, PNCC filed a written extrajudicial claim against PCIC
notifying it of Kalingos default and demanding the repayment of the down payment on P.O. No. 71024L
as secured by PCIC Bond No. 27547, in the amount ofP1,050,000.00. The claim went unheeded despite
repeated demands. For this reason, on April 24, 2001, PNCC filed with the Regional Trial Court (RTC),
Mandaluyong City a complaint for collection of a sum of money against Kalingo and PCIC.

PCIC, in its answer, argued that the partial delivery of four out of the 25 units of tollbooth by Kalingo
under P.O. No. 71024L should reduce Kalingo's obligation.
The trial court ruled in favor of PNCC and made no ruling on PCICs liability under PCIC Bond No. 27546,
a claim that was not pleaded in the complaint.

On appeal, the CA, by Decision of January 7, 2008, held that the RTC erred in ruling that PCIC's liability
is limited only to the payment of P1,050,000.00 under PCIC Bond No. 27547 which secured the down
payment on P.O. No. 71024L. The appellate court held that PCIC, as surety, is liable jointly and severally
with Kalingo for the amount of the two bonds.

ISSUE:

Whether or not PCIC is liable for payment of the security bond not alleged in the complaint for collection
of money.

HELD:

No. The issue before us calls for a discussion of a courts basic appreciation of allegations in a complaint.
The fundamental rule is that reliefs granted a litigant are limited to those specifically prayed for in the
complaint; other reliefs prayed for may be granted only when related to the specific prayer(s) in the
pleadings and supported by the evidence on record. Necessarily, any such relief may be granted only
where a cause of action therefor exists, based on the complaint, the pleadings, and the evidence on
record.

Each of the surety bonds issued by PCIC created a right in favor of PNCC to collect the repayment of the
bonded down payments made on the two POs if contractor Kalingo defaults on his obligation under the
award to fabricate and deliver to PNCC the tollbooths contracted for. Concomitantly, PCIC, as surety, had
the obligation to comply with its undertaking under the bonds to repay PNCC the down payments the
latter made on the POs if Kalingo defaults.

It must be borne in mind that each of the two bonds is a distinct contract by itself, subject to its own terms
and conditions. They each contain a provision that the surety, PCIC, will not be liable for any claim not
presented to it in writing within 15 days from the expiration of the bond, and that the obligee (PNCC)
thereby waives its right to claim or file any court action against the surety (PCIC) after the termination of
15 days from the time its cause of action accrues. This written claim provision creates a condition
precedent for the accrual of: (1) PCICs obligation to comply with its promise under the particular bond,
and of (2) PNCC's right to collect or sue on these bonds. PCICs liability to repay the bonded down
payments arises only upon PNCC's filing of a written claim notifying PCIC of principal Kalingos default
and demanding collection under the bond within 15 days from the bonds expiry date. PNCCs failure to
comply with the written claim provision has the effect of extinguishing PCICs liability and constitutes a
waiver by PNCC of the right to claim or sue under the bond.

The records reveal that PNCC complied with the written claim provision, but only with respect to PCIC
Bond No. 27547.

Under the circumstances, PNCCs cause of action with respect to PCIC Bond No. 27546 did not and
cannot exist, such that no relief for collection thereunder may be validly awarded.

Hence, the trial courts decision finding PCIC liable solely under PCIC Bond No. 27547 is correct not
only because collection under the other bond, PCIC Bond No. 27546, was not raised or pleaded in the
complaint, but for the more important reason that no cause of action arose in PNCCs favor with respect
to this bond. Consequently, the appellate court was in error for including liability under PCIC Bond No.
27546.

PNCC might be alluding to Section 2(c), Rule 7 of the Rules of Court, which provides that a pleading shall
specify the relief sought, but may add a general prayer for such further or other reliefs as may be deemed
just and equitable. Under this rule, a court can grant the relief warranted by the allegation and the proof
even if it is not specifically sought by the injured party; the inclusion of a general prayer may justify the
grant of a remedy different from or together with the specific remedy sought, if the facts alleged in the
complaint and the evidence introduced so warrant.

We find PNCCs argument to be misplaced. A general prayer for "other reliefs just and equitable"
appearing on a complaint or pleading normally enables the court to award reliefs supported by the
complaint or other pleadings, by the facts admitted at the trial, and by the evidence adduced by the
parties, even if these reliefs are not specifically prayed for in the complaint. We cannot, however, grant
PNCC the "other relief" of recovering under PCIC Bond No. 27546 because of the respect due the
contractual stipulations of the parties. While it is true that PCICs liability under PCIC Bond No. 27546
would have been clear under ordinary circumstances (considering that Kalingo's default under his
contract with PNCC is now beyond dispute), it cannot be denied that the bond contains a written claim
provision, and compliance with it is essential for the accrual of PCICs liability and PNCCs right to collect
under the bond.

Najarro vs Jarson Development Corp. GR 142627

FACTS:

Spouses Mariano and Estrella Najarro (spouses Najarro), petitioners, are the registered owners of a
residential building constructed on Lot 1394-C of the Banilad Friar Lands located on V. Sotto
Street, Cebu City. Respondent Jarson Development Corporation (JDC), on the other hand, is a
corporation registered and existing under Philippine laws. It is engaged in the business, among others,
of acquiring and managing real estate, buildings and other
structures. Among JDCs various projects is the development of RichmondPlaza, a 12-story
commercial building located at Lot 1394-B, also of the Banilad Friar Lands, adjacent to Lot 1394-C owned
by petitioners.Jose P. Mabugat and Engineer Eliseo C. Galang, respondents, are the project designer
and the project engineer, respectively, of the Richmond Plaza project.

Sometime in November 1993, respondent JDC started excavation and construction works on
the Richmond Plaza project. However, during the excavation, slippages or cave-ins of soil occurred
on Lot 1394-C causing massive cracks on the wall and floor of petitioners residential building. It became
unsafe for human habitation. Hence, petitioners left the same.On May 26, 1994, petitioners filed with the
Regional Trial Court, Branch 58, Cebu City, a petition for injunction with damages against respondents,
docketed as Civil Case No. 60680.

Before the start of the hearing on July 1, 1994, the parties agreed to dispense with the issue of injunction
in view of respondents undertaking to reconstruct petitioners damaged residential building and to
completely restore the foundation of the soil that caved-in to its original condition.

On August 28, 1995, petitioners filed a motion for execution of the July 11, 1994 Order. However, it was
denied by the trial court in its Order of November 23, 1995 on the ground that the motion should be
resolved when the case shall be decided.On February 22, 2000, the Court of Appeals denied petitioners
motion for reconsideration.
On December 12, 2005, petitioners filed a Motion for Entry of Finality of Judgment. Respondents
filed their Opposition thereto alleging that they and their counsel did not receive a copy of the February
17, 2005 Decision of the Court of Appeals.

On March 17, 2006, the appellate court rendered a Resolution granting petitioners Motion for Entry of
Finality of Judgment and declaring that its Decision dated February 17, 2005 has become final and
executory and ordering that such judgment be entered in the book of entries of judgments.

ISSUE:

WON the decision dated February 17, 2005 has become final and executory.

HELD:
The Court of Appeals found that copies of the Notice of Judgment and its Decision were sent through
rd
registered mail to petitioners counsel at M.B. MahinayBldg. (3 Floor), F. Sotto St., Cebu City. Said
counsel received the same. The latter admitted that through inadvertence, he did not file with the Court of
Appeals a formal notice of his change of address. The Court of Appeals, in granting respondents Motion
for Entry of Finality of Judgment, held:
Section 3, Rule 7 of the Rules of Court pertinently provides:
Sec. 3. Signature and address. Every pleading must be signed by the party or counsel representing
him, stating in either case his address which should not be a post office box.
xxx
Counsel who deliberately files an unsigned pleading, or signs a pleading in violation of this Rule or
alleges scandalous or indecent matters therein, or fails to promptly report to the court a change of his
address, shall be subject to appropriate disciplinary action.

Clearly, it is the duty of the counsel to promptly inform the court of a change of his address. The
contention of defendants-appellants counsel that his failure to inform the Court of his change of address
was due to the fault of his legal secretary in not including the instant case in the inventory of his cases is
a lame excuse and deserves no consideration. It has to be stressed that it devolves upon every counsel
to take full responsibility in supervising the work in his office with respect to all the cases he handles and
he should not delegate this responsibility to his legal secretary.
x x x
Sad to say, the negligence of defendants-appellants counsel in failing to inform the Court of his change
of address which resulted to his non-receipt of Our Decision when the same was served to him in his old
address, which is the address of record when the said judgment was promulgated, binds defendants-
appellants.
xxx
The service of our Decision to defendants-appellants counsel at his address of record on March 2,
2005 was valid. It follows that the reglementary period of fifteen days within which the defendants-
appellants may file a motion for reconsideration or a petition for review on certiorari to the Supreme Court
on Our Decision shall be counted from such date or defendants-appellants had only until March 17, 2005
to file a motion for reconsideration or petition for review on certiorari to the Supreme Court. Apparently,
when plaintiffs-appellees filed the motion for entry of finality of judgment on December 12, 2005, Our
Decision had already attained finality as no motion for reconsideration or petition for review on certiorari
to the Supreme Court was ever filed by defendants-appellants within the reglementary period, or on or
before March 17, 2005.

xxx

Suffice it to state at this point that the Court of Appeals did not err in granting petitioners motion. They
and their counsel are deemed to have received a copy of its Decision. Indeed, the latters failure to file
with the Court of Appeals a notice of change of address is fatal to petitioners case.

JACINTO VS GUMARO

FACTS:

On December 6, 2004, a Decision was rendered in favor of respondent Eduardo Gumaru, Jr. and against
petitioner Joselito Ma. P. Jacinto and F. Jacinto Group, Inc. Petitioner and F. Jacinto Group, Inc. filed an
appeal with the National Labor Relations Commission (NLRC). However, the appeal was not perfected for
failure to post the proper cash or surety bond. Thus, the December 6, 2004 Decision became final and
executory. a Writ of Execution was issued in the labor case. By virtue of such alias writ, real property
belonging to petitioner was levied upon, and was scheduled to be sold at auction on June 27, 2008 or
July 4, 2008. The Labor Arbiter issued an Order denying petitioners Extremely Urgent Motion to Lift and
Annul Levy on Execution. Petitioner appealed the Labor Arbiters June 26,2008 Order to the NLRC,
which, set aside the same. Petitioner went up to the CA on certiorari, assailing the November 28, 2008
and July 27, 2009 Resolutions of the NLRC. the CA issued the first assailed Resolution, which denied
and dismiss the petition.
Petitioner filed his Motion for Reconsideration, arguing that a verification signed by counsel constitutes
adequate and substantial compliance under Sections 4 and 5, Rule 7 of the 1997 Rules of Civil
Procedure; verification is merely a formal, and not jurisdictional, requisite such that an improper
verification or certification against forum-shopping is not a fatal defect. Petitioner attached a copy of an
Affidavit. attesting that he caused the preparation of the CA Petition, and that he read the contents of the
CA Petition and affirm that they are true and correct and undisputed based on his own personal
knowledge and on authentic records. In said Affidavit, petitioner further certified that he has not
commenced any other action or proceeding, or filed any claims involving the same issues in the Supreme
Court, Court of Appeals, or any Division thereof, or in any other court, tribunal or agency; to the best of
his knowledge, no such other action, proceeding, or claim is pending before the Supreme Court, Court of
Appeals, or any division thereof, or in any court, tribunal or agency; if there is any other action or
proceeding which is either pending or may have been terminated, he will state the status thereof; if he
should thereafter learn that a similar action, proceeding or claim has been filed or is pending before the
Supreme Court, Court of Appeals, or any division thereof, or in any court, tribunal or agency, he
undertakes to promptly report the fact within five days from notice thereof. Petitioner explained further that
he was out of the country, and could not return on account of his physical condition, which thus
constrained him to resort to the execution of a sworn statement in lieu of his actual verification and
certification as required under the Rules. Petitioner likewise ratified Atty. Daoss acts done on his behalf
relative to the labor case and the filing of the CA Petition, and implored the appellate court to reconsider
its November 5, 2009 Resolution and excuse his procedural oversight in respect of the improper
verification and certification in his CA Petition.

Respondent contends that with the dismissal of petitioners certiorari petition by the CA, it is for all intents
and purposes deemed to have never been filed, and thus may not be corrected by resorting to a Petition
for Review under Rule 45. Respondent reiterates the view taken by the CA that certiorari under Rule 65 is
a prerogative writ that is not demandable as a matter of right.

ISSUE:

whether or not THE COURT OF APPEALS SHOULD NOT HAVE DISMISSED THE SUBJECT PETITION

RULING:

The Court finds that the Petition has become moot and academic.
It is true, as petitioner asserts, that if for reasonable or justifiable reasons he is unable to sign the
verification and certification against forum shopping in his CA Petition, he may execute a special power of
attorney designating his counsel of record to sign the Petition on his behalf.

For the guidance of the bench and bar, the Court restates in capsule form the jurisprudential
pronouncements already reflected above respecting noncompliance with the requirements on, or
submission of defective, verification and certification against forum shopping:
1) A distinction must be made between non-compliance with the requirement on or submission of
defective verification, and non-compliance with the requirement on or submission of defective
certification against forum shopping.

2) As to verification, non-compliance therewith or a defect therein does not necessarily render the
pleading fatally defective. The court may order its submission or correction or act on the pleading
if the attending circumstances are such that strict compliance with the Rule may be dispensed
with in order that the ends of justice may be served thereby.

3) Verification is deemed substantially complied with when one who has ample knowledge to swear
to the truth of the allegations in the complaint or petition signs the verification, and when matters
alleged in the petition have been made in good faith or are true and correct.
 4) As to certification against forum shopping, non-compliance therewith or a defect therein, unlike in
verification, is generally not curable by its subsequent submission or correction thereof, unless
there is a need to relax the Rule on the ground of "substantial compliance" or presence of
"special circumstances or compelling reasons."

5) The certification against forum shopping must be signed by all the plaintiffs or petitioners in a
case; otherwise, those who did not sign will be dropped as parties to the case. Under reasonable
or justifiable circumstances, however, as when all the plaintiffs or petitioners share a common
interest and invoke a common cause of action or defense, the signature of only one of them in the
certification against forum shopping substantially complies with the Rule.

6) Finally, the certification against forum shopping must be executed by the party-pleader, not by his
counsel. H, however, for reasonable or justifiable reasons, the party-pleader is unable to sign, he
must execute a Special Power of Attorney designating his counsel of record to sign on his
behalf.30 (Emphasis supplied)

However, while the Court takes the petitioner's side with regard to the procedural issue dealing with
verification and the certification against forum shopping, it nonetheless appears that the Petition has been
overtaken by events. In a May 24, 2011 Manifestation, respondent informed this Court that the judgment
award has been satisfied in full. The petitioner does not dispute this claim, in which case, the labor case
is now deemed ended. "It is axiomatic that after a judgment has been fully satisfied, the case is deemed
terminated once and for all."And "when a judgment has been satisfied, it passes beyond review,
satisfaction being the last act and the end of the proceedings, and payment or satisfaction of the
obligation thereby established produces permanent and irrevocable discharge; hence, a judgment debtor
who acquiesces to and voluntarily complies with the judgment is estopped from taking an appeal
therefrom.

Mahinay vs Gako

FACTS:

Constantina H. Sanchez, Josefina H. Lopez and Susan Honoridez are the registered owners (the owners) of a
[11]
parcel of land known as Lot 5. Mahinay filed a complaint for specific performance against the owners and one
Felimon Suarez (Suarez), to compel them to convey Lot 5 to him. This is based on allegation that the owners violate
Mahinays preferential right by selling the property to Suarez.
[22]
The court ruled in favour of Mahinay. The owners and Suarez moved for reconsideration. On November 22,
1996, however, the RTC denied the same.

Whereupon, Mahinay filed a Motion to Issue an Order Directing Sorensen (the current holder of the title) to Turn
Over the title to him. This drew Sorensens Opposition.

On December 12, 2003, Judge Gako issued the assailed Resolution denying Mahinays motion. Mahinay filed a
reiteratory motion. Apparently persuaded by Mahinays formulations, Judge Gako granted his Reiteratory
Motion. Soseren appealed.
[55]
In a Resolution promulgated on April 24, 2007, however, the CA outrightly dismissed Sorensens petition for her
failure to state that the allegations in her petition are true and correct not only based on her personal knowledge but
also based on authentic records.
[56]
Sorensen filed a Motion for Reconsideration and to remedy the defect in her petition submitted an Amended
[57]
Petition with corrected verification. But the CA was not moved by Sorensens subsequent compliance and,
consequently, denied her motion. Hence this petition.

ISSUE:
THAT THE RESPONDENT COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION IN
DISMISSING THE PETITION FOR CERTIORARI FOR FAILING TO STATE IN ITS VERIFICATION PORTION
THE PHRASE OR BASED ON AUTHENTIC RECORDS AS REQUIRED IN SECTION 4, RULE 7 OF THE 1997
RULES ON CIVIL PROCEDURE AS AMENDED BY AM NO. 00-2-10-SC [E]SPECIALLY SO WHEN
PETITIONER HAD ALREADY FILED AN AMENDED PETITION FOR CERTIORARI WITH THE CORRECTED
VERIFICATION PORTION THIS TIME CONTAINING THE PHRASE BASED ON AUTHENTIC RECORDS;

RULING:

The rule requiring certain pleadings to be verified is embodied in Section 4, Rule 7 of the Rules of Court. It reads:

SEC. 4. Verification. Except when otherwise specifically required by

law or rule, pleadings need not be under oath, verified or accompanied by affidavit.

A pleading is verified by an affidavit that the affiant has read the pleading and that the
allegations therein are true and correct of his personal knowledge or based on authentic records.

A pleading required to be verified which contains a verification based on information and

belief, or upon knowledge, information and belief, or lacks a proper verification, shall be treated
as an unsigned pleading.

Verification of pleading is not an empty ritual bereft of any legal importance. It is intended to secure an assurance
that the allegations contained in the pleading are true and correct; are not speculative or merely imagined; and have
[81]
been made in good faith. A pleading may be verified by stating that the pleaders have read the allegations in their
petition and that the same are true and correct based either on theirpersonal knowledge or authentic records, or
based both on their personal knowledge and authentic records. While the rule gives the pleaders several ways of
verifying their pleading, the use of the phrase personal knowledge or authentic records is not without any legal
signification and the pleaders are not at liberty to choose any of these phrases fancifully. Hun Hyung Park v. Eung
[82]
Won Choi teaches us when to properly use authentic records in verifying a pleading:

[A]uthentic records as a basis for verification bear significance in petitions wherein the greater
portions of the allegations are based on the records of the proceedings in the court of origin and/or
the court a quo, and not solely on the personal knowledge of the petitioner. To illustrate, petitioner
himself could not have affirmed, based on his personal knowledge, the truthfulness of the
statement in his petition before the CA that at the pre-trial conference respondent admitted having
received the letter of demand, because he (petitioner) was not present during the
conference. Hence, petitioner needed to rely on the records to confirm its veracity.

[84]
Nonetheless, the Rules and jurisprudence on the matter have it that the court may allow such deficiency to be
[85]
remedied. In Altres v. Empleo, this Court pronounced for the guidance of the bench and the bar that non-
compliance x x x or a defect [in the verification] does not necessarily render the pleading fatally defective. The court
may order its submission or correction or act on the pleading if the attending circumstances are such that strict
compliance with the Rule may be dispensed with in order that the needs of justice may be served thereby.
Pitted against this test, we sustain the CA for not taking a liberal stance in resolving Sorensens petition
for certiorari as the dismissal thereof did not impair or affect her substantive rights.

Rule 7, Section 4: Verification

Vallacar vs Catubig
G.R. 175512

FACTS:
Petitioner is engaged in the business of transportation and the franchise owner of a Ceres Bulilit bus with
Plate No. T-0604-1348. Quirino C. Cabanilla (Cabanilla) is employed as a regular bus driver of petitioner.

On January 27, 1994, respondents husband, Quintin Catubig, Jr. (Catubig), was on his way home from
Dumaguete City riding in tandem on a motorcycle with his employee, Teddy Emperado (Emperado).
Catubig was the one driving the motorcycle. While approaching a curve at kilometers 59 and 60, Catubig
tried to overtake a slow moving ten-wheeler cargo truck by crossing-over to the opposite lane, which was
then being traversed by the Ceres Bulilit bus driven by Cabanilla, headed for the opposite direction. When
the two vehicles collided, Catubig and Emperado were thrown from the motorcycle. Catubig died on the
spot where he was thrown, while Emperado died while being rushed to the hospital.

On February 1, 1994, Cabanilla was charged with reckless imprudence resulting in double homicide in
Criminal Case No. M-15-94 before the Municipal Circuit Trial Court (MCTC) of Manjuyod-Bindoy-Ayungon
of the Province of Negros Oriental. After preliminary investigation, the MCTC issued a Resolution on
December 22, 1994, dismissing the criminal charge against Cabanilla. It found that Cabanilla was not
criminally liable for the deaths of Catubig and Emperado, because there was no negligence, not even
contributory, on Cabanillas part.

Thereafter, respondent filed before the RTC a Complaint for Damages against petitioner.

Petitioner, in its Answer with Counterclaim, contended that the proximate cause of the vehicular collision,
which resulted in the deaths of Catubig and Emperado, was the sole negligence of Catubig when he
imprudently overtook another vehicle at a curve and traversed the opposite lane of the road. As a special
and affirmative defense, petitioner asked for the dismissal of respondents complaint for not being verified
and/or for failure to state a cause of action, as there was no allegation that petitioner was negligent in the
selection or supervision of its employee driver.

On January 26, 2000, the RTC promulgated its Decision favoring petitioner. Respondent appealed to the
Court of Appeals. The appellate court held that both Catubig and Cabanilla were negligent in driving their
respective vehicles.

The Court of Appeals denied the motion for reconsideration of petitioner.

Hence, the instant Petition for Review.

ISSUE:

Whether or not the petitioners complaint for damages is dismissible on the ground of the latters failure
to verify the same.

RULING:

No. Respondent filed her complaint for damages against petitioner on July 19, 1995, when the 1964
Rules of Court was still in effect. Rule 7, Section 6 of the 1964 Rules of Court provided:

SEC. 6. Verification.A pleading is verified only by an affidavit stating that the person verifying has read
the pleading and that the allegations thereof are true of his own knowledge.

Verifications based on "information and belief," or upon "knowledge, information and belief," shall be
deemed insufficient.

On July 1, 1997, the new rules on civil procedure took effect. The foregoing provision was carried on, with
a few amendments, as Rule 7, Section 4 of the 1997 Rules of Court, viz:
SEC. 4. Verification. Except when otherwise specifically required by law or rule, pleadings need not be
under oath, verified or accompanied by affidavit.

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

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

The same provision was again amended by A.M. No. 00-2-10, which became effective on May 1, 2000. It
now reads:

SEC. 4. Verification. - Except when otherwise specifically required by law or rule, pleadings need not be
under oath, verified or accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein
are true and correct of his personal knowledge or based on authentic records.

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

The 1997 Rules of Court, even prior to its amendment by A.M. No. 00-2-10, clearly provides that a
pleading lacking proper verification is to be treated as an unsigned pleading which produces no legal
effect. However, it also just as clearly states that [e]xcept when otherwise specifically required by law or
rule, pleadings need not be under oath, verified or accompanied by affidavit. No such law or rule
specifically requires that respondents complaint for damages should have been verified.

In the case before us, we stress that as a general rule, a pleading need not be verified, unless there is a
law or rule specifically requiring the same. Examples of pleadings that require verification are: (1) all
pleadings filed in civil cases under the 1991 Revised Rules on Summary Procedure; (2) petition for review
from the Regional Trial Court to the Supreme Court raising only questions of law under Rule 41, Section
2; (3) petition for review of the decision of the Regional Trial Court to the Court of Appeals under Rule 42,
Section 1; (4) petition for review from quasi-judicial bodies to the Court of Appeals under Rule 43, Section
5; (5) petition for review before the Supreme Court under Rule 45, Section 1; (6) petition for annulment of
judgments or final orders and resolutions under Rule 47, Section 4; (7) complaint for injunction under
Rule 58, Section 4; (8) application for preliminary injunction or temporary restraining order under Rule 58,
Section 4; (9) application for appointment of a receiver under Rule 59, Section 1; (10) application for
support pendente lite under Rule 61, Section 1; (11) petition for certiorari against the judgments, final
orders or resolutions of constitutional commissions under Rule 64, Section 2; (12) petition for certiorari,
prohibition, and mandamus under Rule 65, Sections 1 to 3; (13) petition for quo warranto under Rule 66,
Section 1; (14) complaint for expropriation under Rule 67, Section 1; (15) petition for indirect contempt
under Rule 71, Section 4, all from the 1997 Rules of Court; (16) all complaints or petitions involving intra-
corporate controversies under the Interim Rules of Procedure on Intra-Corporate Controversies; (17)
complaint or petition for rehabilitation and suspension of payment under the Interim Rules on Corporate
Rehabilitation; and (18) petition for declaration of absolute nullity of void marriages and annulment of
voidable marriages as well as petition for summary proceedings under the Family Code.

In addition, verification, like in most cases required by the rules of procedure, is a formal, not
jurisdictional, requirement, and mainly intended to secure an assurance that matters which are alleged
are done in good faith or are true and correct and not of mere speculation. When circumstances warrant,
the court may simply order the correction of unverified pleadings or act on it and waive strict compliance
with the rules in order that the ends of justice may thereby be served.

XXXXXSALVADOR VS ANGEKLESXXX
G.R. No. 174082 January 16, 2012
GEORGIA T. ESTEL, Petitioner,
vs.
RECAREDO P. DIEGO, SR. and RECAREDO R. DIEGO, JR., Respondents.
DECISION

Facts:
The present petition originated from a Complaint for Forcible Entry, Damages and Injunction with
Application for Temporary Restraining Order filed by herein respondents Recaredo P. Diego, Sr.,
and Recaredo R. Diego, Jr. with the Municipal Trial Court in Cities (MTCC) of Gingoog City,
Misamis Oriental.
Respondents alleged that on April 16, 1991, they entered into a contract of sale of a 306 square-
meter parcel of land with petitioner; after receiving the amount of P17,000.00 as downpayment,
petitioner voluntarily delivered the physical and material possession of the subject property to
respondents and had been in actual, adverse and uninterrupted possession of the subject lot.
At around 8:30 in the morning of July 20, 1995, petitioner, together with her two grown-up sons
and five other persons, uprooted the fence surrounding the disputed lot, after which they entered
its premises and then cut and destroyed the trees and plants found therein.
Respondents prayed for the restoration of their possession, for the issuance of a permanent
injunction against petitioner as well as payment of damages, attorney's fees and costs of suit.
On July 26, 1995, the MTCC issued a Temporary Restraining Order against petitioner and any
person acting in her behalf.
In her Answer with Special/Affirmative Defenses and Counterclaims, petitioner denied the
material allegations in the Complaint contending that respondents were never in physical, actual,
public, adverse and uninterrupted possession of the subject lot; full possession and absolute
ownership of the disputed parcel of land, with all improvements thereon, had always been that of
petitioner and her daughter; the agreement she entered into with the wife of respondent
Recaredo P. Diego, Sr. for the sale of the subject lot had been abrogated; she even offered to
return the amount she received from respondents, but the latter refused to accept the same and
instead offered an additional amount of P12,000.00 as part of the purchase price but she also
refused to accept their offer; the subject of the deed of sale between petitioner and respondents
and what has been delivered to respondents was actually Lot 16 which is adjacent to the disputed
Lot 19; that they did not destroy the improvements found on the subject lot and, in fact, any
5
improvements therein were planted by petitioner's parents.
On February 16, 2002, the MTCC rendered a Decision in favor of the plaintiffs [herein
respondents], dismissing defendant's [herein petitioner's] counterclaim.
Aggrieved, petitioner appealed to the RTC of Gingoog City and rendered its Decision affirming
the assailed Decision of the MTCC.
Petitioner then filed a petition for review with the CA wherein it affirmed the Decision of the
RTC.Petitioner filed a Motion for Reconsideration, but the CA denied it in its Resolution dated
August 10, 2006.

Issue:
Whether or not a verification should be based on personal knowledge or authentic record and not
simply upon knowledge, information and belief.

Ruling :
The Court does not agree.

Anent respondents' alleged defective verification, the Court again notes that this issue was not raised
before the MTCC. Even granting that this matter was properly raised before the court a quo, the Court
finds that there is no procedural defect that would have warranted the outright dismissal of respondents'
complaint as there is compliance with the requirement regarding verification.
Section 4, Rule 7 of the Rules of Court, as amended by A.M. No. 00-2-10-SC provides:
 Sec. 4. Verification. Except when otherwise specifically required by law or rule, pleadings need
not be under oath, verified or accompanied by affidavit.

A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations
therein are true and correct of his personal knowledge or based on authentic records.

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

A reading of respondents verification reveals that they complied with the abovequoted procedural rule.
Respondents confirmed that they had read the allegations in the Complaint which were true and correct
based on their personal knowledge. The addition of the words "to the best" before the phrase "of our own
personal knowledge" did not violate the requirement under Section 4, Rule 7, it being sufficient that the
respondents declared that the allegations in the complaint are true and correct based on their personal
knowledge.

Verification is deemed substantially complied with when, as in the instant case, one who has ample
knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, and
when matters alleged in the petition have been made in good faith or are true and correct.

The instant petition is DENIED. The assailed Decision and Resolution of the Court of Appeals are
AFFIRMED.

SPOUSES LIM V. CA

FACTS:

On January 26, 1999, respondent Bank of the Philippine Islands (BPI) filed before the Regional Trial
Court (RTC), Branch 20, Cagayan de Oro City, a complaint for collection of money with prayer for
preliminary injunction against the petitioners. The verification and certification against forum-shopping
attached to the complaint were signed by Francisco R. Ramos (Ramos), then BPI Assistant Vice-
President and Mindanao Region Lending Head.

On April 22, 1999, the petitioners moved to dismiss BPIs complaint on the ground that there was a
pending action for foreclosure proceedings before the RTC of Ozamis City, filed by BPI against
Philcompak,. The RTC found that the present complaint and the pending action for foreclosure
proceedings involved different causes of action; hence, the RTC denied the petitioners motion to
4
dismiss and the subsequent motion for reconsideration.

On May 26, 2008, the petitioners filed another motion to dismiss, this time, on the ground that there had
been a fatal defect in the verification and certification against forum shopping attached to BPIs complaint.
They argued that the verification and certification did not state or declare that Ramos was filing the
subject complaint in a representative capacity or as an authorized officer of BPI; nor did it state that
Ramos was authorized by BPIs Board of Directors to file the complaint through a board resolution made
specifically for the purpose.
9
The RTC denied the petitioners second motion to dismiss and the subsequent motion for
10 11
reconsideration. The petitioners assailed these orders of denial in the petition for certiorari they filed
with the CA.
12
In a decision dated February 26, 2010, the CA dismissed the petitioners certiorari petition. The
petitioners moved to reconsider the assailed decision but the CA denied their motion, hence, the filing of
13
the present petition for review on certiorari with this Court.

ISSUES:
 a. whether the CA gravely erred when it affirmed the RTC in not dismissing BPIs complaint against
the petitioners due to the alleged lack of authority of Francisco R. Ramos to file the BPI complaint
and sign its attached verification and certification against forum shopping;
b. whether the Special Power of Attorney and Corporate Secretarys Certificate that BPI belatedly
submitted constituted substantial compliance with the requirements under the rules on verification
and certification.

RULING:

We note that, at the time the complaint against the petitioners was filed, Ramos also held the position of
Assistant Vice-President for BPI Northern Mindanao and was then the highest official representing the
23
bank in the Northern Mindanao area. This position and his standing in the BPI hierachy, to our mind,
place him in a sufficiently high and authoritative position to verify the truthfulness and correctness of the
allegations in the subject complaint, to justify his authority in filing the complaint and to sign the
verification and certification against forum shopping. Whatever is lacking, from the strictly corporate point
of view, was cured when BPI subsequently (although belatedly) issued the appropriate SPA.1wphi1

In any case, it is settled that the requirements of verification and certification against forum shopping are
24
not jurisdictional. Verification is required to secure an assurance that the allegations in the petition have
25
been made in good faith or are true and correct, and not merely speculative. Non-compliance with the
26
verification requirement does not necessarily render the pleading fatally defective, and is substantially
complied with when signed by one who has ample knowledge of the truth of the allegations in the
complaint or petition, and when matters alleged in the petition have been made in good faith or are true
27
and correct. On the other hand, the certification against forum shopping is required based on the
principle that a party-litigant should not be allowed to purse simultaneous remedies in different for
28
a. While the certification requirement is obligatory, non-compliance or a defect in the certification could
be cured by its subsequent correction or submission under special circumstances or compelling reasons,
or on the ground of "substantial compliance.

SWEDISH MATCH PHILIPPINES, INC., Petitioner,

vs.
THE TREASURER OF THE CITYOF MANILA, Respondent.

FACTS:

On 20 October 2001, petitioner paid business taxes in the total amount of P470,932.21. The assessed
amount was based on Sections 14 and 21 of Ordinance No. 7794, otherwise known as the Manila
Revenue Code, as amended by Ordinance Nos. 7988 and 8011. Out of that amount, P164,552.04
corresponded to the payment under Section 21.

Assenting that it was not liable to pay taxes under Section 21, petitioner wrote a letter dated 17
September 2003 to herein respondent claiming a refund of business taxes the former had paid pursuant
to the said provision. Petitioner argued that payment under Section 21 constituted double taxation in view
of its payment under Section 14.

On 17 October 2003, for the alleged failure of respondent to act on its claim for a refund, petitioner filed a
Petition for Refund of Taxes with the RTC of Manila in accordance with Section 196 of the Local
Government Code of 1991. The Petition was docketed as Civil Case No. 03-108163.

On 14 June 2004, the Regional Trial Court (RTC), Branch 21 of Manila rendered a Decision in Civil Case
No. 03-108163 dismissing the Petition for the failure of petitioner to plead the latters capacity to sue and
to state the authority of Tiarra T. Batilaran-Beleno (Ms. Beleno), who had executed the Verification and
Certification of Non-Forum Shopping.
In denying petitioners Motion for Reconsideration, the RTC went on to say that Sections 14 and 21
pertained to taxes of a different nature and, thus, the elements of double taxation were wanting in this
case.

On appeal, the CTA Second Division affirmed the RTCs dismissal of the Petition for Refund of Taxes on
the ground that petitioner had failed to state the authority of Ms. Beleno to institute the suit.

The CTA En Banc likewise denied the Petition for Review, ruling as follows:

In this case, the plaintiff is the Swedish Match Philippines, Inc. However, as found by the RTC as well as
the Court in Division, the signatory of the verification and/or certification of non-forum shopping is Ms.
Beleno, the companys Finance Manager, and that there was no board resolution or secretary's certificate
showing proof of Ms. Belenos authority in acting in behalf of the corporation at the time the initiatory
pleading was filed in the RTC. It is therefore, correct that the case be dismissed.

ISSUE: (Related to the topic RULE 7, SEC. 4 VERIFICATION)

Whether Ms. Beleno was authorized to file the Petition for Refund of Taxes with the RTC

HELD:

YES. Ms. Belino was authorized to file the Petition for Refund of Taxes with the RTC.

Anent the procedural issue, petitioner argues that there can be no dispute that Ms. Beleno was acting
within her authority when she instituted the Petition for Refund before the RTC, notwithstanding that the
Petition was not accompanied by a Secretarys Certificate. Her authority was ratified by the Board in its
Resolution adopted on 19 May 2004. Thus, even if she was not authorized to execute the Verification and
Certification at the time of the filing of the Petition, the ratification by the board of directors retroactively
applied to the date of her signing.

On the other hand, respondent contends that petitioner failed to establish the authority of Ms. Beleno to
institute the present action on behalf of the corporation. Citing Philippine Airlines v. Flight Attendants and
Stewards Association of the Philippines (PAL v. FASAP), respondent avers that the required certification
of non-forum shopping should have been valid at the time of the filing of the Petition. The Petition,
therefore, was defective due to the flawed Verification and Certification of Non-Forum Shopping, which
were insufficient in form and therefore a clear violation of Section 5, Rule 7 of the 1997 Rules of Civil
Procedure.

Consequently, a verification signed without an authority from the board of directors is defective. However,
the requirement of verification is simply a condition affecting the form of the pleading and non-compliance
does not necessarily render the pleading fatally defective. The court may in fact order the correction of
the pleading if verification is lacking or, it may act on the pleading although it may not have been verified,
where it is made evident that strict compliance with the rules may be dispensed with so that the ends of
justice may be served.

A distinction between noncompliance and substantial compliance with the requirements of a certificate of
22
non-forum shopping and verification as provided in the Rules of Court must be made. In this case, it is
undisputed that the Petition filed with the RTC was accompanied by a Verification and Certification of
Non-Forum Shopping signed by Ms. Beleno, although without proof of authority from the board. However,
the Supreme Court finds that the belated submission of the Secretarys Certificate constitutes substantial
compliance with Sections 4 and 5, Rule 7 of the 1997 Revised Rules on Civil Procedure.

Clearly, this is not an ordinary case of belated submission of proof of authority from the board of directors.
Petitioner-corporation ratified the authority of Ms. Beleno to represent it in the Petition filed before the
RTC, particularly in Civil Case No. 03-108163, and consequently to sign the verification and certification
of non-forum shopping on behalf of the corporation. This fact confirms and affirms her authority and gives
Supreme Court all the more reason to uphold that authority.

SPOUSES SILVESTRE O. PLAZA AND ELENA Y. PLAZA, Petitioners,

vs.
GUILLERMO LUSTIVA, ELEODORA VDA. DE MARTINEZ AND VICKY SAYSON
GOLOSENO, Respondents.

THE FACTS
4
On August 28, 1997, the CA ruled that among the Plaza siblings, namely: Aureliano, Emiliana, Vidal,
Marciano, and Barbara, Barbara was the owner of the subject agricultural land.
The decision became final and executory and Barbara's successors, respondents Guillermo Lustiva,
Eleodora Vda. de Martinez and Vicky Sayson Goloseno, have continued occupying the property.

They prayed that the respondents be enjoined from unlawfully and illegally threatening to take possession
of the subject property.

According to the petitioners, they acquired the land from Virginia Tuazon in 1997; Tuazon was the sole
bidder and winner in a tax delinquency sale conducted by the City of Butuan on December 27, 1996.
Moreover, Tuazon, being a government employee, was disqualified to bid in the public auction, as stated
5
in Section 89 of the Local Government Code of 1991.

As Tuazons participation in the sale was void, she could have not transferred ownership to the
petitioners.

Equally important, the petitioners merely falsified the property tax declaration by inserting the name of the
petitioners father, making him appear as a co-owner of the auctioned land.
THE RTCS RULING
6
In its December 14, 1999 order, the Regional Trial Court (RTC) of Butuan City, Branch 5, reconsidered
7
its earlier order, denied the prayer for a Writ of Preliminary Injunction, and ordered that the possession
and occupation of the land be returned to the respondents.
The RTC found that the auction sale was tainted with irregularity as the bidder was a government
employee disqualified in accordance with Section 89 of the Local Government Code of 1991.
The petitioners are not buyers in good faith either. On the contrary, they were in bad faith for having
falsified the tax declaration they redeemed the property with.
THE CAS RULING
While the petition for review on certiorari was pending before the CA, the petitioners filed an action for
8
specific performance against the City Government of Butuan.
According to the petitioners, they acquired possession and ownership over the auctioned property when
they redeemed it from Tuazon. The City Government of Butuan must therefore issue them a certificate of
9
sale.
The CA, after legal analysis, similarly concluded that for being disqualified to bid under Section 89 of the
Local Government Code of 1991, Tuazon never obtained ownership over the property; much less
transmit any proprietary rights to the petitioners.
Clearly, the petitioners failed to establish any clear and unmistakable right enforceable by the injunctive
relief.:

ISSUE
ARE THE PETITIONERS GUILTY OF FORUM SHOPPING?

THE COURTS RULING

YES!
The petitioners are guilty of forum shopping. We agree with the CA that the petitioners committed forum
shopping when they filed the specific performance case despite the pendency of the present case before
the CA.
 26
In the recent case of Heirs of Marcelo Sotto, etc., et al. v. Matilde S. Palicte, the Court laid down the
three ways forum shopping may be committed:
1) through litis pendentia filing multiple cases based on the same cause of action and with the same
prayer, the previous case not having been resolved yet;
2) through res judicata filing multiple cases based on the same cause of action and the same prayer,
the previous case having been finally resolved; and
3) splitting of causes of action filing multiple cases based on the same cause of action but with
different prayers the ground to dismiss being either litis pendentia or res judicata.
"The requisites of litis pendentia are:
(a) the identity of parties, or at least such as representing the same interests in both actions;
(b) the identity of rights asserted and relief prayed for, the relief being founded on the same facts; and
(c) the identity of the two cases such that judgment in one, regardless of which party is successful, would
27
amount to res judicata in the other."
Noticeable among these three types of forum shopping is the identity of the cause of action in the
different cases filed. Cause of action is "the act or omission by which a party violates the right of
28
another."
The cause of action in the present case (and the main case) is the petitioners claim of ownership of the
land when they bought it, either from the City Government of Butuan or from Tuazon.
This ownership is the petitioners basis in enjoining the respondents from dispossessing them of the
property.
On the other hand, the specific performance case prayed that the City Government of Butuan be ordered
to issue the petitioners the certificate of sale grounded on the petitioners ownership of the land when they
had bought it, either from the City Government of Butuan or from Tuazon.
While it may appear that the main relief prayed for in the present injunction case is different from what
was prayed for in the specific performance case, the cause of action which serves as the basis for the
reliefs remains the same the petitioners alleged ownership of the property after its purchase in a public
auction.
Thus, the petitioners' subsequent filing of the specific performance action is forum shopping of the third
kind-splitting causes of action or filing multiple cases based on the same cause of action, but with
different prayers.
As the Court has held in the past, "there is still forum shopping even if the reliefs prayed for in the two
29
cases are different, so long as both cases raise substantially the same issues."
Similarly, the CA correctly found that the petitioners and their counsel were guilty of forum shopping
based on litis pendentia.
Not only were the parties in both cases the same insofar as the City Government of Butuan is concerned,
there was also identity of rights asserted and identity of facts alleged.
The cause of action in the specific performance case had already been ruled upon in the present case,
although it was still pending appeal before the CA. Likewise, the prayer sought in the specific
performance case-for the City Government of Butuan to execute a deed of sale in favor of the petitioners
- had been indirectly ruled upon in the present case when the R TC declared that no certificate of sale
could be issued because there had been no valid sale.

MEDISERV VS CHINA BANK

Facts:
China Banking Corporation filed a complaint for a sum of money to recover deficiency judgment in
foreclosure proceedings against petitioners. Yu, the Assistant VP of the bank, signed the certification
against forum shopping .Petitioners filed a Motion for Extension of Time to File Motion to Dismiss/answer,
which was granted. They were given 15 days. However, because their counsel withdrew their
appearance, they again filed another motion for extension for another 15 days. This was again granted by
the Judge Makasiar, with a warning that no further extension would be entertained. Despite the
warning, petitioners yet filed another motion, which was denied.10 days after the last day granted by the
Judge for petitioners to file a motion to dismiss, the petitioners filed a motion to dismiss the complaint on
the ground of litis pendentia (pending suit),lack of cause of action and payment of claim. Private
respondents filed a motion to declare petitioners in default, and to strike out the motion to dismiss. Judge
granted the motion .Petitioners filed an Omnibus Motion; (a) to lift the order of default; (b) to dismiss the
complaint with prejudice for violation of the requirement of certification against forum-shopping; and (c) to
cite Lydia Yu in contempt of Court. Judge denied motion in its September1998 Order.
Before the CA, petitioners assailed the trial courts refusal to dismiss the complaint on the ground of non-
compliance with the requirements of a certification of forum-shopping and declaring
the petitioners in default without first resolving this motion to dismiss which was filed ahead of banks
motion to declare them in default.CA ruled that the Omnibus Motion to Lift Order of Default was fatally
flawed, as it was filed beyond the extended periods to file answer granted by the court, was not under
oath, and was not accompanied by a proper affidavit of merit.

Issue: whether or not the court a quos decision was not in accordance with law and SC decisions when
it avoided to rule on the issue of respondent banks failure to comply with the essential requirement of a
certification against forum shopping and instead declared the petitioners in default.
Held: No. Petition is unmeritorious. Court agrees that the Omnibus Motion was fatally flawed although
the Omnibus Motion insofar as it seeks the lifting of the order of default, may have been seasonably filed
two months after petitioners were already declared in default for failure to file motion to dismiss within the
extended period granted by the court. However, the said Omnibus Motion was not under oath as required
in Rule 9, Sec. 3 (b), and the Affidavit of Merit is defective in that it failed to aver any fact which
constitutes movants good and substantial defense nor allege circumstances constituting defendants
mistake or excusable negligence as contemplated by the Rules. Petitioners have conspicuously failed to
traverse these factual findings of the court on these defects, whether in its Petition, its Reply to Comment
and Memorandum, and instead seek to focus their attack on respondents complaint on the ground of
alleged violation of the rule on forum shopping. A party declared in default is deprived of the right to take
part in the trial and forfeits his rights as a party litigant except the right to receive notice of subsequent
proceedings. To obtain relief from an order of default, the said party may at any time after notice thereof
and before judgment file a motion under oath to set aside order of default upon proper showing that his
failure to answer was due to fraud, accident, mistake or excusable negligence and that he has a
meritorious defense. If not accompanied by an affidavit of merit, the trial court has no authority to consider
the same. Petitioners failed to set aside the order of default and must suffer the consequences thereof.
PETITION DENIED

PRISCILLA ALMA JOSE,

Vs.
RAMON C. JAVELLANA,ET AL.,

FACTS:
On September 8, 1979, Margarita Marquez Alma Jose (Margarita) sold for consideration
of P160,000.00 to respondent Ramon Javellana by deed of conditional sale two parcels of land.

They agreed that Javellana would pay P80,000.00 upon the execution of the deed and the balance of
P80,000.00 upon the registration of the parcels of land under the Torrens System and that should
Margarita become incapacitated, her son and attorney-in-fact, Juvenal M. Alma Jose (Juvenal), and
her daughter, petitioner Priscilla M. Alma Jose, would receive the payment of the balance and
proceed with the application for registration.

After Margarita died and with Juvenal having predeceased Margarita without issue, the vendors
undertaking fell on the shoulders of Priscilla, being Margaritas sole surviving heir. However, Priscilla
did not comply with the undertaking to cause the registration of the properties under the Torrens
System, and, instead, began to improve the properties by dumping filling materials therein with the
intention of converting the parcels of land into a residential or industrial subdivision.

Javellana commenced an action for specific performance, injunction, and damages against her in the
Regional Trial Court in Malolos, Bulacan (RTC), docketed as Civil Case No. 79-M-97.

Priscilla filed a motion to dismiss, stating that the complaint was already barred by prescription; and
that the complaint did not state a cause of action.
 On June 24, 1999. RTC upon Priscillas Motion for Reconsideration granted her Motion to Dismiss on
the grounds that 1. that Javellana had no cause of action, 2. no evidence showing the payment of the
balance; 3. that he had never demanded the registration of the land from Margarita or Juvenal, or
brought a suit for specific performance against Margarita or Juvenal.

On June 21, 2000 Javellanas Motion for Reconsideration was denied.

[14]
Accordingly, Javellana filed a notice of appeal from the June 21, 2000 order, which the RTC gave
due course to, and the records were elevated to the Court of Appeals (C.A.-G.R. CV No. 68259).

It appears that pending the appeal, Javellana also filed a petition for certiorari in the CA to assail the
June 24, 1999 and June 21, 2000 orders dismissing his complaint (C.A.-G.R. SP No. 60455).

[17]
the CA dismissed the petition for certiorari, finding that the RTC did not commit grave abuse of
discretion in issuing the orders. the CA promulgated its decision in C.A.-G.R. CV No.
[18]
68259, reversing and setting aside the dismissal of Civil Case No. 79-M-97, and remanding the
records to the RTC for further proceedings in accordance with law.

Priscilla brought an appeal, one of the grounds is Javellana was guilty of forum shopping for filing in
the CA a petition for certiorari to assail the orders of the RTC that were the subject matter of his
appeal pending in the CA.

Javellana countered that he was not guilty of forum shopping because at the time he filed the petition
for certiorari the CA had not yet rendered a decision in C.A.-G.R.CV No. 68259, and because the
issue of ownership raised in C.A.-G.R. CV No. 68259 was different from the issue of grave abuse of
discretion raised in C.A.-G.R. SP No. 60455.
ISSUE:
WON Javellana is guilty of forum shopping?
RULING:
No forum shopping was committed

Priscilla claims that Javellana engaged in forum shopping by filing a notice of appeal and a
petition for certiorari against the same orders. As earlier noted, he denies that his doing so violated the
policy against forum shopping.
The Court expounded on the nature and purpose of forum shopping in In Re: Reconstitution of
Transfer Certificates of Title Nos. 303168 and 303169 and Issuance of Owners Duplicate Certificates of
[30]
Title In Lieu of Those Lost, Rolando Edward G. Lim, Petitioner:

Forum shopping is the act of a party litigant against whom an adverse judgment has been
rendered in one forum seeking and possibly getting a favorable opinion in another forum, other than
by appeal or the special civil action of certiorari, or the institution of two or more actions or
proceedings grounded on the same cause or supposition that one or the other court would make a
favorable disposition. Forum shopping happens when, in the two or more pending cases, there is
identity of parties, identity of rights or causes of action, and identity of reliefs sought. Where the
elements of litis pendentia are present, and where a final judgment in one case will amount to res
judicata in the other, there is forum shopping. For litis pendentia to be a ground for the dismissal of
an action, there must be: (a) identity of the parties or at least such as to represent the same interest
in both actions; (b) identity of rights asserted and relief prayed for, the relief being founded on the
same acts; and (c) the identity in the two cases should be such that the judgment which may be
rendered in one would, regardless of which party is successful, amount to res judicata in the other.

For forum shopping to exist, both actions must involve the same transaction, same
essential facts and circumstances and must raise identical causes of action, subject matter
and issues. Clearly, it does not exist where different orders were questioned, two distinct
causes of action and issues were raised, and two objectives were sought.
 Should Javellanas present appeal now be held barred by his filing of the petition for certiorari in
the CA when his appeal in that court was yet pending?
[31]
We are aware that in Young v. Sy, in which the petitioner filed a notice of appeal to elevate the
orders concerning the dismissal of her case due to non-suit to the CA and a petition for certiorari in the
CA assailing the same orders four months later, the Court ruled that the successive filings of the notice of
appeal and the petition for certiorari to attain the same objective of nullifying the trial courts dismissal
orders constituted forum shopping that warranted the dismissal of both cases. The Court said:

Ineluctably, the petitioner, by filing an ordinary appeal and a petition

for certiorari with the CA, engaged in forum shopping. When the petitioner
commenced the appeal, only four months had elapsed prior to her filing with the CA
the Petition for Certiorariunder Rule 65 and which eventually came up to this Court by
way of the instant Petition (re: Non-Suit). The elements of litis pendentia are present
between the two suits. As the CA, through its Thirteenth Division, correctly noted, both
suits are founded on exactly the same facts and refer to the same subject matter
the RTC Orders which dismissed Civil Case No. SP-5703 (2000) for

failure to prosecute. In both cases, the petitioner is seeking the reversal of the RTC
orders. The parties, the rights asserted, the issues professed, and the reliefs prayed for,
are all the same. It is evident that the judgment of one forum may amount to res
judicata in the other.
xxxx
The remedies of appeal and certiorari under Rule 65 are mutually exclusive and
not alternative or cumulative. This is a firm judicial policy. The petitioner cannot hedge
her case by wagering two or more appeals, and, in the event that the ordinary appeal
lags significantly behind the others, she cannot post facto validate this circumstance as a
demonstration that the ordinary appeal had not been speedy or adequate enough, in
order to justify the recourse to Rule 65. This practice, if adopted, would sanction the filing
of multiple suits in multiplefora, where each one, as the petitioner couches it, becomes a
precautionary measure for the rest, thereby increasing the chances of a favorable
decision. This is the very evil that the proscription on forum shopping seeks to put right.
In Guaranteed Hotels, Inc. v. Baltao, the Court stated that the grave evil sought to be
avoided by the rule against forum shopping is the rendition by two competent tribunals of
two separate and contradictory decisions. Unscrupulous party litigants, taking advantage
of a variety of competent tribunals, may repeatedly try their luck in several
different fora until a favorable result is reached. To avoid the resultant confusion, the
Court adheres strictly to the rules against forum shopping, and any violation of these
[32]
rules results in the dismissal of the case.

[33]
The same result was reached in Zosa v. Estrella, which likewise involved the successive filing
of a notice of appeal and a petition for certiorari to challenge the same orders, with the Court upholding
the CAs dismissals of the appeal and the petition forcertiorari through separate decisions.

Yet, the outcome in Young v. Sy and Zosa v. Estrella is unjust here even if the orders of the RTC
being challenged through appeal and the petition for certiorari were the same. The unjustness exists
because the appeal and the petition for certiorari actually sought different objectives. In his appeal in
C.A.-G.R. CV No. 68259, Javellana aimed to undo the RTCs erroneous dismissal of Civil Case No. 79-M-
97 to clear the way for his judicial demand for specific performance to be tried and determined in due
course by the RTC; but his petition for certiorari had the ostensible objective to prevent (Priscilla) from
developing the subject property and from proceeding with the ejectment case until his appeal is finally
[34]
resolved, as the CA explicitly determined in its decision in C.A.-G.R. SP No. 60455.
 Nor were the dangers that the adoption of the judicial policy against forum shopping designed to
prevent or to eliminate attendant. The first danger, i.e., the multiplicity of suits upon one and the same
cause of action, would not materialize considering that the appeal was a continuity of Civil Case No. 79-
M-97, whereas C.A.-G.R. SP No. 60455 dealt with an independent ground of alleged grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of the RTC. The second danger, i.e., the
unethical malpractice of shopping for a friendly court or judge to ensure a favorable ruling or judgment
after not getting it in the appeal, would not arise because the CA had not yet decided C.A.-G.R. CV No.
68259 as of the filing of the petition for certiorari.

Instead, we see the situation of resorting to two inconsistent remedial approaches to be the result
of the tactical misjudgment by Javellanas counsel on the efficacy of the appeal to stave off his
caretakers eviction from the parcels of land and to prevent the development of them into a residential or
commercial subdivision pending the appeal. In the petition for certiorari, Javellana explicitly averred that
his appeal was inadequate and not speedy to prevent private respondent Alma Jose and her
transferee/assignee xxx from developing and disposing of the subject property to other parties to the total
deprivation of petitioners rights of possession and ownership over the subject property, and that the
dismissal by the RTC had emboldened private respondents to fully develop the property and for
[35]
respondent Alma Jose to file an ejectment case against petitioners overseer xxx. Thereby, it became
far-fetched that Javellana brought the petition for certiorari in violation of the policy against forum
shopping.

WHEREFORE, the Court DENIES the petition for review on certiorari; AFFIRMS the decision
promulgated on November 20, 2002; and ORDERS the petitioner to pay the costs of suit.

MA. MERCEDES L. BARBA vs LICEO DE CAGA Y AN UNIVERSITY

G .R. No. 193857 11/28/2012

FACTS:

Petitioner Dr. Ma. Mercedes L. Barba was the Dean of the College of Physical Therapy of respondent
Liceo de Cagayan University, Inc., a private educational institution located at Carmen, Cagayan de Oro
City.
Petitioner started working for respondent on July 8, 1993 as medical officer/school physician for a period
of one school year or until March 31, 1994. In July 1994, she was chosen by respondent to be the
recipient of a scholarship grant to pursue a three-year residency training in Rehabilitation Medicine at the
Veterans Memorial Medical Center (VMMC).
After completing her residency training, petitioner returned to continue working for respondent. She was
appointed as Acting Dean of the College of Physical Therapy and at the same time designated as Doctor-
In-Charge of the Rehabilitation Clinic of the Rodolfo N. Pelaez Hall, City Memorial Hospital.
On June 19, 2002, petitioners appointment as Doctor-In-Charge of the Rehabilitation Clinic was renewed
and she was appointed as Dean of the College of Physical Therapy by respondents President, Dr. Jose
Ma. R. Golez.
Petitioner accepted her appointment and assumed the position of Dean of the College of Physical
Therapy. In the school year 2003 to 2004, the College of Physical Therapy suffered a dramatic decline in
the number of enrollees from a total of 1,121 students in the school year 1995 to 1996 to only 20 students
enrolled for school year 2004-2005.
Due to the low number of enrollees, respondent decided to freeze the operation of the College of Physical
Therapy indefinitely. Respondents President Dr. Rafaelita Pelaez-Golez wrote petitioner a letter dated
March 16, 2005 informing her that her services as dean of the said college will end at the close of the
school year. Thereafter, the College of Physical Therapy ceased operations on March 31, 2005, and
petitioner went on leave without pay starting on April 9, 2005.
Subsequently, respondents Executive Vice President, Dr. Mariano M. Lerin, through Dr. Glory S.
Magdale, respondents Vice President for Academic Affairs, sent petitioner a letter dated April 27, 2005
instructing petitioner to return to work on June 1, 2005 and report to Ma. Chona Palomares, the Acting
Dean of the College of Nursing, to receive her teaching load and assignment as a full-time faculty
member in that department for the school year 2005-2006.
In reply, petitioner informed Dr. Lerin that she had not committed to teach in the College of Nursing and
that as far as she can recall, her employment is not dependent on any teaching load. She then requested
for the processing of her separation benefits in view of the closure of the College of Physical Therapy.
She did not report to Palomares on June 1, 2005.
Petitioner filed a complaint with the Labor Arbiter for constructive dismissal. LA found that petitioner was
not illegally dismissed because petitioners assignment as full-time professor in the College of Nursing
was not a demotion tantamount to constructive dismissal.
Petitioner appealed to NLRC, NLRC reversed LAs decision holding the petitioner was illegally dismissed.
Respondent, Liceo de Cagayan, filed a motion for reconsideration but was denied.
Respondent went to the CA on a petition for certiorari alleging that the NLRC committed grave abuse of
discretion when it declared that petitioners transfer to the College of Nursing as full-time professor but
without diminution of salaries and without loss of seniority rights amounted to constructive dismissal
because there was a demotion involved in the transfer and because petitioner was compelled to accept
her new assignment.
Respondent also filed a Supplemental Petition raising for the first time the issue of lack of jurisdiction of
the Labor Arbiter and the NLRC over the case. Respondent claimed that a College Dean is a corporate
officer under its by-laws and petitioner was a corporate officer of respondent since her appointment was
approved by the board of directors. Respondent posited that petitioner was a corporate officer since her
office was created by the by-laws and her appointment, compensation, duties and functions were
approved by the board of directors. Thus, respondent maintained that the jurisdiction over the case is with
the regular courts and not with the labor tribunals.
In CAs original decision, it set aside the decision of the NLRC but did not find merit in the in respondents
assertion in its Supplemental Petition that the position of petitioner as College Dean was a corporate
office.
On the issue of alleged lack of jurisdiction, the CA observed that respondent never raised the issue of
jurisdiction before the Labor Arbiter and the NLRC and respondent even actively participated in the
proceedings below. Hence, respondent is estopped from questioning the jurisdiction of the labor tribunals.
Unsatisfied, both petitioner and respondent sought reconsideration of the CA decision. Petitioner prayed
for the reversal of the ruling that there was no constructive dismissal. Respondent meanwhile maintained
that the labor tribunals have no jurisdiction over the case, petitioner being a corporate officer.
On reconsideration, CA set aside its earlier ruling and held that the position of a College Dean is a
corporate office and therefore the labor tribunals had no jurisdiction over the complaint for constructive
dismissal. Petitioner filed a motion for reconsideration but was denied. Hence this petition.
ISSUE:
Whether petitioner was an employee or a corporate officer of respondent university. Resolution of this
issue resolves the question of whether the appellate court was correct in ruling that the Labor Arbiter and
the NLRC had no jurisdiction over petitioners complaint for constructive dismissal against respondent.
HELD:
As a general rule, only questions of law may be allowed in a petition for review on certiorari. Considering
that the CA reversed its earlier decision and made a complete turnaround from its previous ruling, and
consequently set aside both the findings of the Labor Arbiter and the NLRC for allegedly having been
issued without jurisdiction, it is necessary for the Court to reexamine the records and resolve the
conflicting rulings.
After a careful review and examination of the records, we find that the CAs previous ruling that petitioner
was respondents employee and not a corporate officer is supported by the totality of the evidence and
more in accord with law and prevailing jurisprudence.
Corporate officers are elected or appointed by the directors or stockholders, and are those who are given
that character either by the Corporation Code or by the corporations by-laws. Section 25 of the
Corporation Code enumerates corporate officers as the president, the secretary, the treasurer and such
other officers as may be provided for in the by-laws. In Matling Industrial and Commercial Corporation v.
Coros, the phrase such other officers as may be provided for in the by-laws has been clarified.
Undoubtedly, petitioner is not a College Director and she is not a corporate officer but an employee of
respondent. Applying the four-fold test concerning (1) the selection and engagement of the employee; (2)
the payment of wages; (3) the power of dismissal; (4) the employers power to control the employee with
respect to the means and methods by which the work is to be accomplished, it is clear that there exists an
employer-employee relationship between petitioner and respondent.
Records show that petitioner was appointed to her position as Dean by Dr. Golez, the university president
and was paid a salary of P32,500 plus transportation allowance. It was evident that respondent had the
power of control over petitioner as one of its deans. It was also the university president who informed
petitioner that her services as Dean of the College of Physical Therapy was terminated effective March
31, 2005 and she was subsequently directed to report to the Acting Dean of the College of Nursing for
assignment of teaching load. Thus, petitioner, being an employee of respondent, her complaint for
illegal/constructive dismissal against respondent was properly within the jurisdiction of the Labor Arbiter
and the NLRC. Article 217 of the Labor Code.
Moreover, we agree with the CAs earlier pronouncement that since respondent actively participated in
the proceedings before the Labor Arbiter and the NLRC, it is already estopped from belatedly raising the
issue of lack of jurisdiction. In this case, respondent filed position papers and other supporting documents
to bolster its defense before the labor tribunals but in all these pleadings, the issue of lack of jurisdiction
was never raised. It was only in its Supplemental Petition filed before the CA that respondent first brought
the issue of lack of jurisdiction. We have consistently held that while jurisdiction may be assailed at any
stage, a partys active participation in the proceedings will estop such party from assailing its jurisdiction.
It is an undesirable practice of a party participating in the proceedings and submitting his case for
decision and then accepting the judgment, only if favorable, and attacking it for lack of jurisdiction, when
adverse.
Under Section 6, Rule 10 of the 1997 Rules of Civil Procedure, as
amended, governing supplemental pleadings, the court may admit supplemental pleadings, such as the
supplemental petition filed by respondent before the appellate court, but the admission of these pleadings
remains in the sound discretion of the court. Nevertheless, we have already found no credence in
respondents claim that petitioner is a corporate officer, consequently, the alleged lack of jurisdiction
asserted by respondent in the supplemental petition is bereft of merit.
Petition is granted

Digital Microwave Corp. vs. CA

Facts:

On December 14, 1994, private respondent Asian High Technology Corp. filed a complaint against
petitioner Digital Microwave Corp. for a sum of money and damages before the Regional Trial Court of
Pasig city. Petitioner moved for the dismissal of the complaint. The trial court denied the motion, as well
as petitioners subsequent motion for reconsideration.
Petitioner then initiated a special civil action for certiorari before the Court of Appeals, alleging grave
abuse of discretion on the part of the trial court. However, the Court of Appeals dismissed the petition for
failure to comply with Revised Circular No. 28-91, as amended by Administrative Circular No. 04-94. Said
circular requires the petition filed before the Court of Appeals to be accompanied by a sworn certification
against forum shopping, signed by petitioner himself.
Petitioners certification was signed by counsel; the petition was, thus, dismissed. Petitioner moved for a
reconsideration of the dismissal and submitted a sworn certification against forum shopping duly signed
by one of its senior officers. The motion was, however, denied, with the Court of Appeals stating that
"In the present case, absent any compelling reason for petitioners failure to comply, at first instance, with
Revised Supreme Court Circular No. 28-91, the Court cannot therefore, accept its subsequent
compliance.
Petitioner contends that in the case of a corporation as petitioner, the certification against forum shopping
may be signed by a natural person authorized to do so and with knowledge of the required facts. The
authorized person may be anyone authorized by the corporation, not necessarily an officer thereof. In
such a case, petitioner argues, the counsel of record has the authority to execute the certification on
behalf of the corporation, particularly considering that under the Rules of Court, counsels authority to
represent his client is presumed. No written power of attorney is required for counsel to appear for his
client.
ISSUE: w/n the certification of non- forum shopping may be signed by the counsel?

Held;
No. The reason the certification against forum shopping is required to be accomplished by
petitioner himself is because only the petitioner himself has actual knowledge of whether or not he has
initiated similar actions or proceedings in different courts or agencies.
We disagree with petitioner that a corporation cannot possibly hope to comply with the
requirement laid down by Revised Circular No. 28-91 because it is a juridical entity and not a natural
person. If this were so, then it would have been impossible for a corporation to do anything at all.
Needless to say, this is the reason why corporations have directors and officers, to represent it in its
transactions with others. The same is true for the certification against forum shopping. It could easily have
been made by a duly authorized director or officer of the corporation. That petitioner did not in the first
instance comply with the requirement of revised Circular No. 28-91 by having the certification against
forum shopping signed by one of its officers, as it did after its petition before the Court of Appeals had
been dismissed, is beyond our comprehension.
In the recent case of Spouses Valentin Ortiz and Camilla Milan Ortiz v. Court of Appeals, et al., 299
SCRA 708, 711-712 (1998), we ruled that
"Regrettably, we find that substantial compliance will not suffice in a matter involving strict observance as
provided for in Circular No. 28-91. The attestation contained in the certification on non-forum shopping
requires personal knowledge by the party who executed the same. To merit the Courts consideration,
petitioners here must show reasonable cause for failure to personally sign the certification. The
petitioners must convince the court that the outright dismissal of the petition would defeat the
administration of justice."
In this case, petitioner has not adequately explained its failure to have the certification against forum
shopping signed by one of its officers.

[G.R. No. 147394. August 11, 2004]

SPOUSES MANUEL and ROSEMARIE WEE, petitioners, vs. ROSARIO D. GALVEZ, respondent.

Penned by: QUISUMBING, J.:

Facts:

Petitioner Rosemarie Wee and respondent Rosario D. Galvez are sisters.[3] Rosemarie lives with her
husband, petitioner Manuel Wee, in Balanga, Bataan, while Rosario resides in New York, U.S.A. The
present controversy stemmed from an investment agreement between the two sisters, which had gone
sour along the way.

On April 20, 1999, Rosario, represented by Grace Galvez as her attorney-in-fact, filed a complaint before
the RTC of Quezon City to collect a sum of money from Manuel and Rosemarie Wee. The amount for
collection was US$20,000 at the exchange rate of P38.30 per dollar. The complaint, which was docketed
as Civil Case No. Q-99-37372, alleged that Rosario and Rosemarie entered into an agreement whereby
Rosario would send Rosemarie US$20,000, half of said amount to be deposited in a savings account
while the balance could be invested in the money market. The interest to be earned therefrom would be
given to Rosarios son, Manolito Galvez, as his allowance.

In accordance with her agreement with Rosario, Rosemarie gave Manolito his monthly allowance ranging
from P2,000 to P4,000 a month from 1993 to January 1999. However, sometime in 1995, Rosario asked
for the return of the US$20,000 and for an accounting. Rosemarie promised to comply with the demand
but failed to do so.

In January 1999, Rosario, through her attorney-in-fact, Grace Galvez, sent Rosemarie a written demand
for her US$20,000 and an accounting. Again, Rosemarie ignored the demand, thus causing Rosario to
file suit.
On May 18, 1999, the Wees moved to dismiss Civil Case No. Q-99-37372 on the following grounds: (1)
the lack of allegation in the complaint that earnest efforts toward a compromise had been made in
accordance with Article 151[5] of the Family Code; (2) failure to state a valid cause of action, the action
being premature in the absence of previous earnest efforts toward a compromise; and (3) the certification
against forum shopping was defective, having been executed by an attorney-in-fact and not the plaintiff,
as required by Rule 7, Section 5[6] of the 1997 Rules of Civil Procedure.

Issue: Whether or not The pleading is defective due to errors in verification?

Ruling:

The answer is in the Negative.

Respondent in the instant case is already a resident of the United States, and not of the Philippines.
Hence, it was proper for her to appoint her daughter, Grace Galvez, to act as her attorney-in-fact in the
Philippines. The Special Power of Attorney granted by the respondent to her attorney-in-fact, Grace
Galvez, categorically and clearly authorizes the latter to do the following:

1. To ask, demand and claim any sum of money that is duly [due] from any person natural, juridical
and/or corporation in the Philippines;

2. To file criminal and/or civil complaints before the courts of justice in the Philippines to enforce my
rights and interest[s];

3. To attend hearings and/or Preliminary Conference[s], to make stipulations, adjust claims, to settle
and/or enter into Compromise Agreement[s], to litigate and to terminate such proceedings; [and]

4. To sign all papers, documents and pleadings necessary for the accomplishment of the above
purposes.

From the foregoing, it is indisputable that Grace Galvez, as attorney-in-fact of the respondent, was duly
authorized and empowered not just to initiate complaints, whether criminal or civil, to enforce and protect
the respondents rights, claims, and interests in this jurisdiction, but is specifically authorized to sign all
papers, documents, and pleadings necessarily connected with the filing of a complaint. Pursuant to
Administrative Circular No. 04-94, which extended the requirement of a certification on non-forum
shopping to all initiatory pleadings filed in all courts and quasi-judicial agencies, as well as Rule 7, Section
5 of the 1997 Rules of Civil procedure, the aforementioned papers and documents, which Grace Galvez
was authorized and empowered to sign, must necessarily include the certification on non-forum shopping.
To conclude otherwise would render nugatory the Special Power of Attorney and also render
respondents constitution of an attorney-in-fact inutile.

Forum shopping occurs when a party attempts to have his action tried in a particular court or jurisdiction
where he feels he will receive the most favorable judgment or verdict. In our jurisdiction, it has taken the
form of filing multiple petitions or complaints involving the same issues before two or more tribunals or
agencies in the hope that one or the other court would make a favorable disposition. There is also forum
shopping when, because of an adverse decision in one forum, a party seeks a favorable opinion (other
than by appeal or certiorari) in another. The rationale against forum shopping is that a party should not be
allowed to pursue simultaneous remedies in two different fora. Filing multiple petitions or complaints
constitutes abuse of court processes, which tends to degrade the administration of justice, wreaks havoc
upon orderly judicial procedure, and adds to the congestion of the heavily burdened dockets of the courts.
Thus, the rule proscribing forum shopping seeks to promote candor and transparency among lawyers and
their clients in the pursuit of their cases before the courts to promote the orderly administration of justice,
prevent undue inconvenience upon the other party, and save the precious time of the courts. It also aims
to prevent the embarrassing situation of two or more courts or agencies rendering conflicting resolutions
or decisions upon the same issue. It is in this light that we must look at the propriety and correctness of
the Certificate of Non-Forum Shopping signed by Grace Galvez on the respondents behalf. We have
examined said Certificate and find that under the circumstances, it does not negate but instead serves the
purpose of the rule against forum shopping, namely to promote and facilitate the orderly administration of
justice.

Rule 7, Section 5 of the Rules of Court, requires that the certification should be signed by the petitioner
or principal party himself. The rationale behind this is because only the petitioner himself has actual
knowledge of whether or not he has initiated similar actions or proceedings in different courts or
agencies. However, the rationale does not apply where, as in this case, it is the attorney-in-fact who
instituted the action. The Special Power of Attorney in this instance was constituted precisely to authorize
Grace Galvez to file and prosecute suits on behalf of respondent, who was no longer resident of the
Philippines but of New York, U.S.A. As respondent points out, it is Grace Galvez, as attorney-in-fact for
her, who has actual and personal knowledge whether she initiated similar actions or proceedings before
various courts on the same issue on respondents behalf. Said circumstance constitutes reasonable
cause to allow the attorney-in-fact, and not the respondent, as plaintiff in Civil Case No. Q-99-37372 to
personally sign the Certificate of Non-Forum Shopping. Under the circumstances of this case, we hold
that there has been proper compliance with the rule proscribing forum shopping. As we previously held
concerning Administrative Circular No. 04-94:

The fact that the Circular requires that it be strictly complied with merely underscores its mandatory
nature in that it cannot be dispensed with or its requirements altogether disregarded, but it does not
thereby interdict substantial compliance with its provisions under justifiable circumstances.

Administrative Circular No. 04-94 is now incorporated in the 1997 Rules of Civil Procedure, as Rule 7,
Section 5. It is basic that the Rules shall be liberally construed in order to promote their objective of
securing a just, speedy and inexpensive disposition of every action and proceeding.Otherwise put, the
rule requiring a certification of forum shopping to accompany every initiatory pleading, should not be
interpreted with such absolute literalness as to subvert its own ultimate and legitimate objective or the
goal of all rules of procedure which is to achieve substantial justice as expeditiously as possible.

G.R. No. 172623 : March 13, 2010

COA VS. PALER

FACTS:

This is a petition for review under Rule 45 of the Rules of Court assailing the decision dated
December 20, 2005 and resolution dated April 27, 2005 rendered by the Court of Appeals (CA) in CA-
G.R. SP No. 90360.

Respondent Celso M. Paler was a Supervising Legislative Staff Officer II (SG-24) with the Technical
Support Service of the Commission on Appointments. On April 8, 2003, he submitted a request for
vacation leave for 74 working days - from August 1,2003 to November 14, 2003. In a
memorandum dated April 22, 2003, Ramon C. Nghuatco, Director III of Technical Support Service,
submitted to the Commission Secretary his comments/recommendation on Paler's application.

Since he already had an approved leave from June 9 to July 30, 2003, Paler left for the United States on
June 8, 2003, without verifying whether his application for leave (for August 1 - November 14, 2003) was
approved or denied.

In a letter dated September 16, 2003, the Commission Chairman informed Paler that he was being
dropped from the roll of employees effective said date, due to his continuous 30-day absence without
leave and in accordance with Section 63, Civil Service Commission (CSC) Memorandum Circular No. 14,
s. 1999. Paler's son received the letter on September 23, 2003.
Paler moved for reconsideration but this was denied on February 20, 2004, on the ground that it was filed
beyond the 15-day reglementary period. The denial was received by Paler's son on March 18, 2004.

On appeal, the CSC reversed and set aside the Commission Chairman's decision dated September 16,
2003 per resolution 04-1214 dated November 9, 2004.

The Commission filed a motion for reconsideration but this was denied by the CSC per resolution No.
050833 dated June 23, 2005.

This constrained petitioner to file with the CA a petition for review under Rule 43 of the Rules of Court.

Since Paler had in the meantime already reached the compulsory age of retirement on July 28, 2005 and
was no longer entitled to reinstatement, the CA affirmed with modification CSC resolution 04-1214 dated
November 9, 2004 and resolution No. 050833 dated June 23, 2005.

Petitioner filed a motion for reconsideration but this was denied by the CA in the assailed resolution dated
April 27, 2005.

Hence, this petition

ISSUE:

Paler questions the authority of the Commission Secretary to file the petition and sign the verification and
certification of non-forum shopping in behalf of the Commission Chairman.

RULING:

Authority to File Petition

The petitioner in this case is the Commission on Appointments, a government entity created by the
Constitution, and headed by its Chairman. There was no need for the Chairman himself to sign the
verification. Its representative, lawyer or any person who personally knew the truth of the facts alleged in
the petition could sign the verification. With regard, however, to the certification of non-forum shopping,
the established rule is that it must be executed by the plaintiff or any of the principal parties and not by
counsel. In this case, Atty. Tiu failed to show that he was specifically authorized by the Chairman to sign
the certification of non-forum shopping, much less file the petition in his behalf. There is nothing on record
to prove such authority. Atty. Tiu did not even bother to controvert Paler's allegation of his lack of
authority. This renders the petition dismissible.

Furthermore, the petition is bereft of merit as it merely restates the arguments presented before the CSC
and CA. It does not advance any cogent reason that will convince this Court to deviate from the rulings of
both tribunals.

RULE 8

SALITA V. HON. MAGTOLIS

G.R. NO. 106429, JUNE 13, 1994

FACTS:

The petition for annulment was filed before the Regional Trial Court of Quezon City on 7 January 1992.
Therein it is alleged that "[s]ometime in 1987, petitioner (Erwin Espinosa) came to realize that respondent
(Joselita Salita) was psychologically incapacitated to comply with the essential marital obligations of their
marriage, which incapacity existed at the time of the marriage although the same became manifest only
2
thereafter." Dissatisfied with the allegation in the petition, Joselita moved for a bill of particulars which
the trial court granted. Subsequently, in his Bill of Particulars, Edwin specified that she was unable to
understand and accept the demands made by his profession that of a newly qualified Doctor of
Medicine upon petitioners time and efforts so that she frequently complained of his lack of attention to
her even to her mother, whose intervention caused petitioner to lose his job. Still Joselita was not
contented with the Bill of Particulars. She argued that the "assertion (in the Bill of Particulars) is a
statement of legal conclusion made by petitioners counsel and not an averment of ultimate facts, as
4
required by the Rules of Court, from which such a conclusion may properly be inferred . . . ." But finding
the questioned Bill of Particulars adequate, the trial court issued an order upholding its sufficiency and
directing Joselita to file her responsive pleading.

ISSUE:

Whether the Bill of Particulars submitted by herein respondent is of sufficient definiteness or particularity
as to enable herein petitioner to properly prepare her responsive pleading or for trial.

RULING:

The Bill of Particulars submitted is sufficient.

A complaint only needs to state the "ultimate facts constituting the plaintiffs cause or causes of
9 10
action." Ultimate facts has been defined as "those facts which the expected evidence will support." As
stated by private respondent, "[t]he term does not refer to the details of probative matter or particulars of
evidence by which these material elements are to be established." It refers to "the facts which the
evidence on the trial will prove, and not the evidence which will be required to prove the existence of
those facts." And a motion for bill of particulars will not be granted if the complaint, while not very definite,
11
nonetheless already states a sufficient cause of action. A motion for bill of particulars may not call for
matters which should form part of the proof of the complaint upon trial. Such information may be obtained
12
by other means.
We sustain the view of respondent Court of Appeals that the Bill of Particulars filed by private respondent
is sufficient to state a cause of action, and to require more details from private respondent would be to
ask for information on evidentiary matters. Indeed, petitioner has already been adequately apprised of
private respondents cause of action against her thus
. . . . (she) was psychologically incapacitated to comply with the essential marital
obligations of their marriage in that she was unable to understand and accept the
demands made by his profession that of a newly qualified Doctor of Medicine upon
petitioners time and efforts so that she frequently complained of his lack of attention to
her even to her mother, whose intervention caused petitioner to lose his job.
On the basis of the aforequoted allegations, it is evident that petitioner can already prepare her
responsive pleading or for trial. Private respondent has already alleged that "she (petitioner) was unable
to understand and accept the demands made by his profession . . . upon his time and efforts . . . "
Certainly, she can respond to this. To demand for more details would indeed be asking for information on
13
evidentiary facts facts necessary to prove essential or ultimate facts. For sure, the additional facts
called for by petitioner regarding her particular acts or omissions would be evidentiary, and to obtain
14
evidentiary matters is not the function of a motion for bill of particulars.
15
We distinguish the instant case from Tantuico, Jr. v. Republic where we said
Furthermore, the particulars prayed for such as names of persons, names of
corporations, dates, amounts involved, a specification of property for identification
purposes, the particular transactions involving withdrawals and disbursements, and a
statement of other material facts as would support the conclusions and inferences in the
complaint, are not evidentiary in nature. On the contrary, those particulars are material
facts that should be clearly and definitely averred in the complaint in order that the
defendant may, in fairness, be informed of the claims made against him to the end that
he may be prepared to meet the issues at the trial.
The aforementioned pronouncement cannot apply to the instant case. That ruling involves alleged
"misappropriation and theft of public funds, plunder of the nations wealth, extortion, blackmail, bribery,
embezzlement, and other acts of corruption, betrayal of public trust and brazen abuse of power." The
respondents therein pray for reconveyance, reversion, accounting, restitution and damages. There, the
alleged illicit acts should be fully documented. The instant case, on the other hand, concerns marital
relationship. It would be unreasonable, if not unfeeling, to document each and every circumstance of
marital disagreement. True, the complaining spouse will have to prove his case, but that will not come
until trial begins.
Consequently, we have no other recourse but to order the immediate resumption of the annulment
proceeding which have already been delayed for more than two years now, even before it could reach its
trial stage. Whether petitioner is psychologically incapacitated should be immediately determined. There
is no point in unreasonably delaying the resolution of the petition and prolonging the agony of the wedded
couple who after coming out from a storm still have the right to a renewed blissful life either alone or in
the company of each other.

G.R. No. 143375 July 6, 2001

RUTH D. BAUTISTA, petitioner,
vs.
COURT OF APPEALS, OFFICE OF THE REGIONAL STATE PROSECUTOR, REGION IV, and SUSAN
ALOA,respondents.

Facts:
Sometime in April 1998 petitioner Ruth D. Bautista issued to private respondent Susan Aloa Check No.
005014037 dated 8 May 1998 for P1,500,000.00 drawn on Metrobank Cavite City Branch with assurance
that the check would be sufficiently funded on the maturity date.
On 20 October 1998 private respondent presented the check for payment. The drawee bank dishonored
the check because it was drawn against insufficient funds (DAIF).
On 16 March 1999 private respondent filed a complaint-affidavit with the City Prosecutor of Cavite City. In
addition to the details of the issuance and the dishonor of the check, she also alleged that she made
repeated demands on petitioner to make arrangements for the payment of the check within five (5)
working days after receipt of notice of dishonor from the bank, but that petitioner failed to do so.
Petitioner submitted her own counter-affidavit asserting in her defense that presentment of the check
within ninety (90) days from due date thereof was an essential element of the offense of violation of BP
22. Since the check was presented for payment 166 days after its due date, it was no longer punishable
under BP 22 and therefore the complaint should be dismissed for lack of merit. She also claimed that she
already assigned private respondent her condominium unit at Antel Seaview Condominium, Roxas
Boulevard, as full payment for the bounced checks thus extinguishing her criminal liability.
On 22 April 1999, the investigating prosecutor issued a resolution recommending the filing of
an Information against petitioner for violation of BP 22, which was approved by the City Prosecutor.
On 13 May 1999 petitioner filed with the Office of the Regional State Prosecutor (ORSP) for Region IV a
petition for review of the 22 April 1999 resolution. The ORSP denied the petition.
On 5 July 1999 petitioner filed a motion for reconsideration, which the ORSP also denied on 31 August
1999.
On 1 October 1999 petitioner filed with the Court of Appeals a petition for review of the resolution of the
ORSP dated 22 April 1999 as well as the order dated 31 August 1999 denying reconsideration.
The appellate court issued the assailed Resolution dated 26 October 1999 denying due course outright
and dismissing the petition.
Issue:
Whether or not the drawer of a check which is dishonored due to lack of sufficient funds can be
prosecuted under BP 22 even if the check is presented for payment after ninety (90) days from its due
date.

Ruling:
Yes.
Petitioner is accused of violation of BP 22 the substantive portion of which reads -
Section 1. Checks without sufficient funds. - Any person who makes or draws and issues any
check to apply on account or for value, knowing at the time of issue that he does not have
sufficient funds in or credit with the drawee bank for the payment of such in full upon
presentment, which check is subsequently dishonored by the drawee bank for insufficiency of
 funds or credit or would have been dishonored for the same reason had not the drawer, without
any valid reason, ordered the bank to stop payment, shall be punished by imprisonment of not
less than thirty (30) days but not more than one (1) year or by a fine of not less than but not more
than double the amount of the check which fine shall in no case exceed Two Hundred Thousand
Pesos, or both such fine and imprisonment at the discretion of the court.
The same penalty shall be imposed upon any person who, having sufficient funds in or credit with
the drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds
or to maintain a credit to cover the full amount of the check if presented within a period of ninety
(90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank
x x x x (italics supplied).
An analysis of Sec. 1 shows that The Bouncing Checks Law penalizes two (2) distinct acts: First, making
or drawing and issuing any check to apply on account or for value, knowing at the time of issue that the
drawer does not have sufficient funds in or credit with the drawee bank; and, second, having sufficient
funds in or credit with the drawee bank shall fail to keep sufficient funds or to maintain a credit to cover
the full amount of the check if presented within a period of ninety (90) days from the date appearing
thereon, for which reason it is dishonored by the drawee bank.
In the first paragraph, the drawer knows that he does not have sufficient funds to cover the check at the
time of its issuance, while in the second paragraph, the drawer has sufficient funds at the time of
issuance but fails to keep sufficient funds or maintain credit within ninety (90) days from the date
appearing on the check. In both instances, the offense is consummated by the dishonor of the check for
insufficiency of funds or credit.
The check involved in the first offense is worthless at the time of issuance since the drawer had neither
sufficient funds in nor credit with the drawee bank at the time, while that involved in the second offense is
good when issued as drawer had sufficient funds in or credit with the drawee bank when issued. Under
the first offense, the ninety (90)-day presentment period is not expressly provided, while such period is an
express element of the second offense.
From the allegations of the complaint, it is clear that petitioner is being prosecuted for violation of the first
paragraph of the offense.
It is fundamental that every element of the offense must be alleged in the complaint or information, and
must be proved beyond reasonable doubt by the prosecution. What facts and circumstances are
necessary to be stated must be determined by reference to the definitions and the essentials of the
specific crimes.
The elements of the offense under BP 22 are (a) the making, drawing and issuance of any check to apply
to account or for value; (b) the maker, drawer or issuer knows at the time of issue that he does not have
sufficient funds in or credit with the drawee bank for the payment of such check in full upon its
presentment; and, (c) the check is subsequently dishonored by the drawee bank for insufficiency of funds
or credit or would have been dishonored for the same reason had not the drawer, without any valid
reason, ordered the bank to stop payment.
The ninety (90)-day period is not among these elements. Section 2 of BP 22 is clear that a dishonored
check presented within the ninety (90)-day period creates a prima facie presumption of knowledge of
insufficiency of funds, which is an essential element of the offense. Since knowledge involves a state of
mind difficult to establish, the statute itself creates a prima facie presumption of the existence of this
element from the fact of drawing, issuing or making a check, the payment of which was subsequently
refused for insufficiency of funds. The term prima facie evidence denotes evidence which, if unexplained
or uncontradicted, is sufficient to sustain the proposition it supports or to establish the facts, or to
counterbalance the presumption of innocence to warrant a conviction.
The presumption in Sec. 2 is not a conclusive presumption that forecloses or precludes the presentation
of evidence to the contrary. Neither does the term prima facie evidence preclude the presentation of other
evidence that may sufficiently prove the existence or knowledge of insufficiency of funds or lack of credit.
Surely, the law is not so circumscribed as to limit proof of knowledge exclusively to the dishonor of the
subject check when presented within the prescribed ninety (90) day period.
An endorser who passes a bad check may be held liable under BP 22, even though the presumption of
knowledge does not apply to him, if there is evidence that at the time of endorsement, he was aware of
the insufficiency of funds. It is evident that the presumption in Sec. 2 was intended to facilitate proof of
knowledge and not to foreclose admissibility of other evidence that may also prove such knowledge.
Thus, the only consequence of the failure to present the check for payment within ninety (90) days from
the date stated is that there arises no prima facie presumption of knowledge of insufficiency of funds. But
the prosecution may still prove such knowledge through other evidence. Whether such evidence is
sufficient to sustain probable cause to file the information is addressed to the sound discretion of the City
Prosecutor and is a matter not controllable by certiorari. Certainly, petitioner is not left in a lurch as the
prosecution must prove knowledge without the benefit of the presumption, and she may present whatever
defenses are available to her in the course of the trial.
The distinction between the elements of the offense and the evidence of these elements is analogous or
akin to the difference between ultimate facts and evidentiary facts in civil cases. Ultimate facts are the
essential and substantial facts which either form the basis of the primary right and duty or which directly
make up the wrongful acts or omissions of the defendant, while evidentiary facts are those which tend to
prove or establish said ultimate facts. Applying this analogy to the case at bar, knowledge of insufficiency
of funds is the ultimate fact, or element of the offense that needs to be proved, while dishonor of the
check presented within ninety (90) days is merely the evidentiary fact of such knowledge.
It is worth reiterating that courts will not normally interfere with the prosecutor's discretion to file a criminal
case when there is probable cause to do so. Probable cause has been defined as the existence of such
facts and circumstances as would excite the belief in a reasonable mind, acting on the facts within the
knowledge of the prosecutor, that the person charged was guilty of the crime for which he was
prosecuted.The prosecutor has ruled that there is probable cause in this case, and we see no reason to
disturb the finding.

Lucas v Lucas

Doctrine: The test of the sufficiency of the facts alleged in the complaint is whether or not, admitting the
facts alleged, the court could render a valid judgment upon the same in accordance with the prayer of the
complaint.

FACTS:

Petitioner, filed a Petition to Establish Illegitimate Filiation (with Motion for the Submission of Parties to
DNA Testing)2 before RTC of Valenzuela City. Respondent was not served with acopy of the petition.
Nonetheless, respondent learned of the petition to establish filiation. Hiscounsel therefore went to the trial
court and obtained a copy of the petition. Petitioner filedwith the RTC a Very Urgent Motion to Try
and Hear the Case.

This time, the RTC held that the ruling on the grounds relied upon by petitioner for filing the petition is
premature considering that a full-blown trial has not yet taken place. The court stressed that the petition
was sufficient in form and substance. It was verified, it included a certification against forum shopping,
and it contained a plain, concise, and direct statement of the ultimate facts on which petitioner relies on
for his claim, in accordance with Section 1, Rule 8 of the Rules of Court. The court remarked that the
allegation that the statements in the petition were not of petitioners personal knowledge is a matter of
evidence.

After learning of the September 3, 2007 Order, respondent filed a motion for reconsideration.5
Respondent averred that the petition was not in due form and substancebecause petitioner could not
have personally known the matters that were alleged therein.He argued that DNA testing
cannot be had on the basis of a mere allegation pointing
tor e s p o n d e n t a s p e t i t i o n e r s f a t h e r . M o r e o v e r , j u r i s p r u d e n c e i s s t i l l u n
s e t t l e d o n t h e acceptability of DNA evidence.

I S S U E : WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT ESSENTIALLY RULED

THAT THE TITLE OF A PLEADING, RATHER THAN ITS BODY, IS CONTROLLING

2.

The petition to establish filiation is sufficient in substance. It satisfies Section 1, Rule 8 of the Rules of
Court, which requires the complaint to contain a plain, concise, and direct statement of the ultimate
facts upon which the plaintiff bases his claim. A fact is essential if it cannot be stricken out without
[28]
leaving the statement of the cause of action inadequate. A complaint states a cause of action when it
contains the following elements: (1) the legal right of plaintiff, (2) the correlative obligation of the
defendant, and (3) the act or omission of the defendant in violation of said legal right.

The petition sufficiently states the ultimate facts relied upon by petitioner to establish his filiation to
respondent. Respondent, however, contends that the allegations in the petition were hearsay as they
were not of petitioners personal knowledge. Such matter is clearly a matter of evidence that cannot be
determined at this point but only during the trial when petitioner presents his evidence.

In a motion to dismiss a complaint based on lack of cause of action, the question submitted to the court
for determination is the sufficiency of the allegations made in the complaint to constitute a cause of action
and not whether those allegations of fact are true, for said motion must hypothetically admit the truth of
[30]
the facts alleged in the complaint.
[31]
The inquiry is confined to the four corners of the complaint, and no other. The test of the sufficiency of
the facts alleged in the complaint is whether or not, admitting the facts alleged, the court could render a
[32]
valid judgment upon the same in accordance with the prayer of the complaint.

If the allegations of the complaint are sufficient in form and substance but their veracity and
correctness are assailed, it is incumbent upon the court to deny the motion to dismiss and require the
defendant to answer and go to trial to prove his defense. The veracity of the assertions of the parties can
be ascertained at the trial of the case on the merits.

Rule 8 sec. 4 Capacity to sue

Lorenzo Shipping vs. Chubb
Facts:
Lorenzo Shipping Corporation (Lorenzo Shipping, for short), a domestic corporation engaged in
coastwise shipping, was the carrier of 581 bundles of black steel pipes, the subject shipment, from Manila
to Davao City. From Davao City, respondent Gearbulk, Ltd., a foreign corporation licensed as a common
carrier under the laws of Norway and doing business in the Philippines through its agent, respondent
Philippine Transmarine Carriers, Inc. (Transmarine Carriers, for short), a domestic corporation, carried the
goods on board its vessel M/V San Mateo Victory to the United States, for the account of Sumitomo
Corporation. The latter, the consignee, is a foreign corporation organized under the laws of the United
States of America. It insured the shipment with respondent Chubb and Sons, Inc., a foreign corporation
organized and licensed to engage in insurance business under the laws of the United States of America.
M/V Lorcon received the shipping of steel pipes in good order and condition as evidenced by the clean bill
of lading. When the cargo was unloaded from Lorenzo Shipping's vessel at Davao City, the steel pipes
were rusted all over.
M/V San Mateo of Gearbulk Ltd. which received the cargo issued bills of lading covering the entire
shipment marked "all units heavily rusted". Suveyors found that the cargo hold of M/V Lorcon was flooded
with seawater, the tank was rusty, thinning and perforated thereby exposing the cargo to sea water. The
cargo was damaged while in the ship.
Negligence was sufficiently established. The contact with the steel pipes caused the development of rust.
While the ship was on transit from Davao to US, the consignee sent a letter of intent to Lorenzo Shipping
informing them that it would file a claim based on the damaged cargo once the damaged had been
ascertained.
Once Sumitomo inspected the pipes, it declared them unfit and filed a marine insurance claim against
Chubb and Sons for $104,000.
Chubb and Sons filed a complaint for collection of a sum of money against Lorenzo Shipping, Gearbulk,
and Transmarine.
RTC found Chubb and Sons had the right to institute the action and Lorenzo Shipping was negligent. CA
affirmed.
Lorenzo Shipping claimed the packaging was defective and that the action had prescribed. SC ruled
against both defenses. There was evidence that the shipment was packed in superior condition.
Issues:
Whether respondent Chubb and Sons has capacity to sue before the Philippine courts
Ruling:
Petitioner argues that respondent Chubb and Sons is a foreign corporation not licensed to do business in
the Philippines, and is not suing on an isolated transaction. It contends that because the respondent
Chubb and Sons is an insurance company, it was merely subrogated to the rights of its insured, the
consignee Sumitomo, after paying the latters policy claim. Sumitomo, however, is a foreign corporation
doing business in the Philippines without a license and does not have capacity to sue before Philippine
courts. Since Sumitomo does not have capacity to sue, petitioner then concludes that, neither the
subrogee-respondent Chubb and Sons could sue before Philippine courts.
We disagree with petitioner.
In the first place, petitioner failed to raise the defense that Sumitomo is a foreign corporation doing
business in the Philippines without a license. It is therefore estopped from litigating the issue on appeal
especially because it involves a question of fact which this Court cannot resolve. Secondly, assuming
arguendo that Sumitomo cannot sue in the Philippines, it does not follow that respondent, as subrogee,
has also no capacity to sue in our jurisdiction.
Subrogation is the substitution of one person in the place of another with reference to a lawful claim or
right, so that he who is substituted succeeds to the rights of the other in relation to a debt or claim,
including its remedies or securities.[22] The principle covers the situation under which an insurer that has
paid a loss under an insurance policy is entitled to all the rights and remedies belonging to the insured
against a third party with respect to any loss covered by the policy.[23] It contemplates full substitution
such that it places the party subrogated in the shoes of the creditor, and he may use all means which the
creditor could employ to enforce payment.
The rights to which the subrogee succeeds are the same as, but not greater than, those of the person for
whom he is substituted he cannot acquire any claim, security, or remedy the subrogor did not have.[25]
In other words, a subrogee cannot succeed to a right not possessed by the subrogor.[26] A subrogee in
effect steps into the shoes of the insured and can recover only if insured likewise could have recovered.
However, when the insurer succeeds to the rights of the insured, he does so only in relation to the debt.
Furthermore, respondent insurer Chubb and Sons, by virtue of the right of subrogation provided for in the
policy of insurance,[34] is the real party in interest in the action for damages before the court a quo
against the carrier Lorenzo Shipping to recover for the loss sustained by its insured. Rule 3, Section 2 of
the 1997 Rules of Civil Procedure defines a real party in interest as one who is entitled to the avails of
any judgment rendered in a suit, or who stands to be benefited or injured by it. Where an insurance
company as subrogee pays the insured of the entire loss it suffered, the insurer-subrogee is the only real
party in interest and must sue in its own name[35] to enforce its right of subrogation against the third party
which caused the loss. This is because the insurer in such case having fully compensated its insured,
which payment covers the loss in full, is subrogated to the insureds claims arising from such loss. The
subrogated insurer becomes the owner of the claim and, thus entitled to the entire fruits of the action.[36]
It then, thus possesses the right to enforce the claim and the significant interest in the litigation.[37] In the
case at bar, it is clear that respondent insurer was suing on its own behalf in order to enforce its right of
subrogation.

[G.R. No. 8418. December 9, 1915. ]

L. O. HIBBERD, Plaintiff-Appellant, v. WM. J. ROHDE and D. J. MCMILLIAN, Defendants-

Appellees.

SYLLABUS
CONTRACTS; ADMISSION OF GENUINENESS AND DUE EXECUTION. By the admission of the
genuineness and due execution of an instrument, as the term is used in section 103 of the Code of Civil
Procedure, is meant that the party whose signature it bears admits that he signed it or that it was signed
by another for him with his authority; that at the time it was signed it was in words and figures exactly as
set out in the pleading of the party relying upon it; that the document was delivered and that any formal
requisites required by law, such as a seal, an acknowledgment, or revenue stamp, which it lacks, are
waived by him.
DEFENSES CUT OFF. Such defenses as that the signature is a forgery; or that it was unauthorized,
as in the case of an agent signing for his principal, or one signing in behalf of a partnership, or of a
corporation; or that, in the ease of the latter, that the corporation was not authorized under its charter to
sign the instrument; or that the party charged signed the instrument in some other capacity than that
alleged in the pleading setting it out; or that it was never delivered are cut off by the admission of its
genuineness and due execution.

DEFENSES ALLOWED. Any defense of new matter, such as payment where nonpayment is alleged,
the statute of limitations, illegality of consideration, etc., may be under a proper plea to that effect,
notwithstanding the failure of the party charged to enter a verified denial of the genuineness and due
execution of the document declared upon.

Facts: This is a suit on a promissory note against the makers. According to the testimony of the defendant
Rohde, McMillian was in the retail liquor business and secured a stock of merchandise valued at P1,200
from Brand & Hibberd and sold it. Alleging that they delivered the merchandise to him on deposit only,
Brand & Hibberd filed a complaint of estafa against McMillian. McMillian was arrested and released on
bond pending the preliminary hearing before the justice of the peace. The defendant Rohde was a
practicing attorney and undertook McMillians defense in the estafa case. Rohde testified that he was well
acquainted with the nature of the transaction between the firm of Brand & Hibberd and McMillian; that the
merchandise was sold outright to McMillian; that he knew the estafa complaint was absolutely without
foundation; and that McMillian could not possibly be convicted; but that one Sullivan informed him after
the preliminary hearing was held that he knew positively that McMillian would be bound over for trial in the
Court of First Instance. In rebuttal, Sullivan testified that what he told Rohde was that he was satisfied
from the evidence introduced at the hearing that McMillian would be held for trial in the Court of First
Instance. Upon the strength of Sullivans statement, Rohde agreed to sign the note reproduced above if
Brand & Hibberd would withdraw the estafa complaint. He did this because he did not want his client to
remain in confinement pending his trial in the Court of First Instance. After the execution of the note,
Brand & Hibberd moved in the justice court that the estafa complaint be dismissed and this motion was
granted by the presiding justice. In the order dismissing the complaint, the justice stated that, from the
evidence introduced at the hearing he was convinced that there was no sufficient basis for a criminal
action, but that the controversy was of a civil character. Rohde subsequently said two hundred pesos on
the note. The note was assigned to the plaintiff L. O. Hibberd, on June 10, 1911.

Defendant Rohde, did not enter a verified specific denial of the genuineness and due execution of
the note, the plaintiff claims that his special defense of illegality of consideration is cut off by section 103
of the Code of Civil Procedure, which reads as follows: "Actions and defenses based upon written
instruments. When an action is brought upon a written instrument and the complaint contains or has
annexed a copy of such instrument, the genuineness and due execution of the instrument shall be
deemed admitted, unless specifically denied under oath in the answer; and when the defense to an
action, or a counterclaim stated in an answer, is founded upon a written instrument and the copy thereof
is contained in or annexed to the answer, the genuineness and due execution of such instrument shall be
deemed admitted, unless specifically denied under oath by the plaintiff in his pleadings."

By the admission of the genuineness and due execution of an instrument, as provided in this
section, is meant that the party whose signature it bears admits that he signed it or that it was signed by
another for him with his authority; that at the time it was signed it was in words and figures exactly as set
out in the pleading of the party relying upon it; that the document was delivered; and that any formal
requisites required by law, such as a seal, an acknowledgment, or revenue stamp, which it lacks, are
waived by him. Hence, such defenses as that the signature is a forgery.

Issue: Whether or not the special defense interposed by the defendant of illegality of consideration is
barred by his failure to enter a verified denial of the genuineness of the note.

Held: The effect of the admission is such that in the case of a promissory note a prima facie case is made
for the plaintiff which dispenses with the necessity of evidence on his part and entitles him to a judgment
on the pleadings unless a special defense of new matter, such as payment, is interposed by the
defendant. Under statutes similar to our own it has been held that the admission of the genuineness and
due execution of the instrument does not bar the defense of want of consideration.

"There is no authority that we know of or any such construction of the rule. Undoubtedly when a
plaintiff produces in court an instrument corresponding to the one set forth he is exempted from proving
its execution. But the actual time of delivery may involve questions which it would be absurd to hold
foreclosed by any such assumption. If a note is dated back in order to include usurious interest, and that
defense is set up, it would hardly be regarded as bearing on the question of execution. Execution can
only refer to the actual making and delivery, but it cannot involve other matters without enlarging its
meaning beyond reason. The only object of the rule was to enable a plaintiff to make out a prima facie,
not a conclusive case, and it cannot preclude a defendant from introducing any defense on the merits
which does not contradict the execution of the instrument introduced in evidence."

To so interpret section 103 as to prohibit such a defense as illegality of consideration, which is

clearly a defense of new matter, would pro tanto repeal the second paragraph of section 94, which
permits a defendant to answer by "A statement of any new matter constituting a defense or counterclaim."
Likewise, section 285 provides that the terms of a writing may be impeached by reason of its illegality or
fraud. We do not understand that such defenses are barred by the provisions of section 103. We
accordingly hold that the special defense interposed by the defendant of illegality of consideration is not
barred by his failure to enter a verified denial of the genuineness and due execution of the note set out in
the complaint. Hence, the evidence in support of that plea was competent.

In the case at bar, the findings of fact made by the court below have been duly submitted to us for
review. The trial court found as a fact that the consideration of the note was the compromise of a public
offense. We do not think that the evidence justifies this conclusion. It is true that the defendant Rohde
testified that the consideration of the note was "the withdrawal of the false charge against him (McMillian)
and to get him out of jail." But it is also in evidence that McMillian owed Brand & Hibberd the full amount
of the note and Rohde knew this fact before he signed the note. There is no charge that Brand & Hibberd
filed the criminal complaint with a view of extorting a settlement of their claim against McMillian. The
hearing at the preliminary investigation was duly had and all the evidence was before the justice of the
peace before the agreement represented by the note was made. It is not shown that Brand & Hibberd
agreed not to testify in any further criminal proceedings against McMillian, or that they would suppress
any evidence in their possession, or that they would solicit the States prosecutor or any other
Government official whose authority extend to the criminal case, to not hold the defendant for trial. What
they actually did was to move in open court for a dismissal of the complaint. This is all they did so far as
the record shows, and that it was satisfactory to the defendant Rohde is apparent from the fact that he
subsequently made partial payments on the note.

There can be no doubt that the agreement which resulted in the execution of the note was
entered into by Brand & Hibberd with an eye to the satisfaction of their pecuniary claim against McMillian.
From the testimony of Rohde himself it appears that he strongly insisted that McMillian was not guilty of
the crime charged, and no doubt his ability as a lawyer tended to convince the complainants that the
criminal charge was unjustified. If they became converted to this view of the matter, they no doubt more
readily consented not to actively assist in the further prosecution of the criminal complaint. We do not
think the record justifies a more radical conclusion as to what Brand & Hibberd agreed to do with
reference to the criminal phase of the transaction than that they promised not to further actively
participate in the case. The record does not justify the conclusion that they went further and agreed to
actively assist in preventing the due investigation of the criminal charge by suppressing evidence, by
declining to appear against McMillian if duly subpoenaed as witnesses, or by other means. In our opinion,
the case is similar in many aspects to Goodrum v. Merchants & Planters Bank (102 Ark., 326). The record
indicates the same passivity on the part of the injured party and the same publicity of the criminal charge.
There having been no agreement to interfere with the due administration of the criminal law, we are
constrained to hold that no part of the consideration of the note declared upon is illegal or against public
policy. The plaintiff is therefore entitled to judgment. The judgment appealed from is reversed and
judgment is decreed against the defendant Rohde for the sum of one thousand pesos, the amount
remaining unpaid on the note, together with legal interest from the date of the institution of this action.
Without costs. So ordered.

ASIAN CONSTRUCTION AND DEVELOPMENT CORPORATION, Petitioner,

vs
SANNAEDLE CO., LTD., Respondent.
Facts: A Complaint for Sum of Money filed by respondent against petitioner. The complaint alleged that
petitioner and respondent executed a Memorandum of Agreement wherein respondent was engaged to
supply and erect insulated panel systems at various pavilions at the Philippine Centennial Exposition
Theme Park. Pursuant to the Memorandum of Agreement, petitioner made various payments amounting
to US$3,129,667.32 leaving a balance of US$615,620.33. Respondent claims that it made several written
demands for petitioner to pay the said balance, but the latter continuously refused to heed its plea.
Thereafter, petitioner filed its Answer with Counterclaim. Respondent then moved for judgment on the
pleadings on the ground that the Answer admitted all material allegations of the Complaint and, therefore,
failed to tender an issue. Thus, respondent deems that petitioners Answer, in effect, admitted the
existence of the Memorandum of Agreement and its failure to pay the balance despite repeated
demands.
On October 6, 2000, the Regional Trial Court (RTC) of Makati City rendered judgment in favor of
respondent. The Court notes that in the Answer with Counterclaim of the [petitioner], the execution of the
Memorandum of Agreement, Annex B of the Complaint was admitted (paragraph 13, Answer). Further, it
did not deny specifically the claim of the [respondent] of being entitled to collect the said amount of
US$615,620.33. Petitioner filed a motion for reconsideration against said decision. However, the same
was denied. Thus, petitioner filed an appeal before the CA. On April 25, 2006, the CA DISMISSED the
appeal. Petitioner filed a motion for reconsideration, but the CA denied.
Petitioner contends that the judgment on the pleadings is not proper, because it raised special and
affirmative defenses in its Answer. It asserts that with this specific denial, a genuine issue of fact had
been joined to the extent that a judgment on the pleadings could not be made.
For its part, respondent counters that petitioners Answer admitted the material allegations of its complaint
regarding the cause of action, which is collection of sum of money. Respondent emphasizes that
assuming petitioners defense of respondents lack of capacity to sue has a leg to stand on, still, the same
cannot prevent respondent from seeking the collection of petitioners unpaid balance.
Issue: whether or not judgment on the pleadings is proper.
Held: The Court finds the petition bereft of merit.
Judgment on the pleadings is governed by Section 1, Rule 34 of the 1997 Rules of Civil Procedure which
reads:
Sec. 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. However, in actions for declaration of nullity or annulment of marriage or for
legal separation, the material facts alleged in the complaint shall always be proved.
Judgment on the pleadings is proper when an answer fails to tender an issue, or otherwise admits the
material allegations of the adverse partys pleading. An answer fails to tender an issue if it does not
comply with the requirements of a specific denial as set out in Sections 8 and 10, Rule 8 of the 1997
Rules of Civil Procedure, resulting in the admission of the material allegations of the adverse partys
pleadings
In Mongao v. Pryce Properties Corporation wherein it was held that "judgment on the pleadings is
governed by Section 1,Rule 34 of the 1997 Rules of Civil Procedure, essentially a restatement of Section
1, Rule 19 of the 1964 Rules of Court then applicable to the proceedings before the trial court. Section 1,
Rule 19 of the Rules of Court provides that 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. The answer would fail to tender an issue, of course, if it does not comply with
the requirements for a specific denial set out in Section 10 (or Section 8) of Rule 8; and it would admit the
material allegations of the adverse partys pleadings not only where it expressly confesses the
truthfulness thereof but also if it omits to deal with them at all.
Further, in First Leverage and Services Group, Inc. v. Solid Builders, Inc., this Court held that where a
motion for judgment on the pleadings is filed, the essential question is whether there are issues
generated by the pleadings. In a proper case for judgment on the pleadings, there is no ostensible issue
at all because of the failure of the defending partys answer to raise an issue
We note that respondents complaint for a sum of money is based mainly on the alleged failure of
petitioner to pay the balance of US$615,620.33 under the Memorandum of Agreement. Quoting
petitioners Answer, it is obvious that it admitted the material allegations.
While petitioner allegedly raised affirmative defenses, i.e., defect in the certification of non-forum
shopping, no legal capacity to sue and fortuitous event, the same cannot still bar respondent from
seeking the collection of the unpaid balance. Other than these affirmative defenses, petitioners denial
neither made a specific denial that a Memorandum of Agreement was perfected nor did it contest the
genuineness and due execution of said agreement.
We, therefore, sustain the CA and quote with approval the well-reasoned findings and conclusions of the
appellate court contained in its Decision, to wit: First, the allegations in the [petitioners] Answer do not
make out a specific denial that a Memorandum of Agreement was perfected between the parties. Second,
the [respondent] does not contest the due execution and/or genuineness of said Memorandum of
Agreement.
The defenses raised by [petitioner] cannot prevent the [respondent] from seeking the collection of the
amount of US$615,620.33.The express terms of the Memorandum of Agreement, the genuineness and
due execution of which are not denied by the [petitioner]. It cannot assert the said defenses in order to
resist the [respondent's] claim for the aforesaid sum of money, especially where it has been sufficiently
shown by the allegations of the Complaint and the Answer that the [petitioner] is clearly liable for the
payment thereof.
WHEREFORE, the instant petition is DENIED.

Worcester vs Lorenzana
GR No. L-9435 July 31, 1958
FACTS OF THE CASE
The appellant Frederick Worcester was the owner of a piece of real estate, La Cumbre de Guadalupe,
which in July, 1950, was sold by him to the Roman Catholic Archbishop of Manila through the mediation
of a broker. Claiming credit for having negotiated through and brought about the sale, another broker, the
herein appellee Ramon Lorenzana, asked Worcester to pay him his brokerage commission and, upon the
demand being refused, he brought suit in the CFI of Manila to recover commission and moral damages.
Worcester contested the suit, characterized its filingas malicious and unjustified, and set up a
counterclaim for actual and moral damages. Replying to the counterclaim, Lorenzana denied its
allegations and on his part set up a claim for moral damages suffered on account thereof. It also appears
that once the suit was filed, Lorenzana had attachment levied on property belonging to Worcester upon
verified petition that the latter was disposing of his properties with the intent to defraud him. But the
attachment was discharged upon the filing of the required bond.
CFI --- Lorenzana is not entitled any commission and rendered judgment dismissing his complaint and
awarding Worcester claims for damages (moral and compensatory).
CA --- the Court upheld the judgment of dismissal but revoked the award of damages.
Protesting against the revocation of the award, Worcester brought the case here on appeal by certiorari.
ISSUE: WON the reply to Defendants counter-claim was in the form of general denial constitutes an
admission of the averment in said counter-claim that he had incurred damages.
SUPREME COURT RULING:
The rule is that the material allegations in the complaint other than those as to the amount of damages
shall be deemed admitted when not specifically denied (Sec.8,Rule 9), it is to be noted that the
counterclaim for damages in the present case is based on the supposition that plaintiffs action was
malicious and unjustified, which is a mere conclusion unsupported by the facts alleged in the counter-
claim and which the CA, as already found to be without basis. Needless to say, that conclusion cannot be
deemed admitted even when not specifically denied.
AGATON V. HON. PEREZ

FACTS:

On June 15, 1960 respondent Feliza B. Martinez and her husband, co-respondent Carlos S.
Martinez, entered into a contract of lease with petitioner Niceforo S. Agaton, covering the second floor of
respondents' house at Camp 8, Kennon Road, Baguio City. The term of the lease was up to June 15,
1961, at a monthly rental of P100.00. On May 8, 1961 respondents filed a complaint in the municipal
court of Baguio for the collection of (1) rents unpaid since December 18, 1960; (2) the value of certain city
services which petitioner was supposed to pay but did not, thus compelling respondents to pay them; and
(3) another indebtedness in the sum of P200, together with attorney's fees of P150. Petitioner filed a
written answer to the complaint, containing denials as well as a number of allegations under the headings
of "first special affirmative defense and/or counterclaim" and "second special affirmative defense and/or
counterclaim. Respondent manifested to the court denying each and every allegations.

ISSUE:

Whether or not allegations not specifically denied are deemed admitted

RULING:

NO.
In the case at bar petitioner's answer, particularly in those portions thereof denominated by him
as special affirmative defenses and/or counterclaims, contains so many unnecessary allegations of
evidentiary matters that a specific denial of each and every one of them was not only uncalled for but
even impractical, especially considering that the old Rules of Court did not require an answer (in this case
to the counterclaim) in the municipal court to be in writing (Rule 4, Sec. 6). In the second place, the
allegations in both the special affirmative defenses and in the counterclaim are so inseparable and indeed
have been lumped by petitioner himself under common headings that, following the rule as to new
matters affirmed in the answer (Rule 11, Section 1, old Rules of Court), they may be deemed
controverted even if not specifically challenged by respondents in a reply.

GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) and WINSTON F. GARCIA, in his capacity as
PRESIDENT and GENERAL MANAGER of the GSIS, Petitioners,
vs.
DINNAH VILLAVIZA, ELIZABETH DUQUE, ADRONICO A. ECHAVEZ, RODEL RUBIO, ROWENA
THERESE B. GRACIA, PILAR LAYCO, and ANTONIO JOSE LEGARDA, Respondents.

FACTS:
Petitioner Winston Garcia (PGM Garcia), as President and General Manager of the GSIS, filed
separate formal charges against respondents DinnahVillaviza, Elizabeth Duque, Adronico A. Echavez,
Rodel Rubio, Rowena Therese B. Gracia, PilarLayco, and Antonio Jose Legarda for Grave Misconduct
and/or Conduct Prejudicial to the Best Interest of the Service pursuant to the Rules of Procedure in
Administrative Investigation (RPAI) of GSIS Employees and Officials, III, D, (1, c, f) in relation to Section
52A (3), (20), Rule IV, of the Uniform Rules on Administrative Cases in the Civil Service (URACCS), in
accordance with Book V of the Administrative Code of 1987.
This episode was earlier reported to PGM Garcia, through an office memorandum dated May 31,
2005, by the Manager of the GSIS Security Department (GSIS-SD), Dennis Nagtalon. On the same day,
the Manager of the GSIS Investigation Unit (GSIS-IU), Atty. LutgardoBarbo, issued a memorandum to
each of the seven (7) respondents requiring them to explain in writing and under oath within three (3)
days why they should not be administratively dealt with.
PGM Garcia then filed the above-mentioned formal charges for Grave Misconduct and/or
Conduct Prejudicial to the Best Interest of the Service against each of the respondents, all dated June 4,
2005. Respondents were again directed to submit their written answers under oath within three (3) days
[5]
from receipt thereof. None was filed.
 On June 29, 2005, PGM Garcia issued separate but similarly worded decisions finding all seven
(7) respondents guilty of the charges and meting out the penalty of one (1) year suspension plus the
accessory penalties appurtenant thereto.

On appeal, the Civil Service Commission (CSC) found the respondents guilty of the lesser
offense of Violation of Reasonable Office Rules and Regulations and reduced the penalty to
reprimand. The CSC ruled that respondents were not denied their right to due process but there was no
substantial evidence to hold them guilty of Conduct Prejudicial to the Best Interest of the Service.

PGM Garcia sought reconsideration but was denied. Thus, PGM Garcia went to the Court of Appeals via
a Petition for Review under Rule 43 of the Rules on Civil Procedure.
ISSUE: WHETHER OR NOT THE ALLEGATIONS IN THE FORMAL CHARGES OF THE PETITIONER
AGAINST RESPONDENTS ARE DEEMED ADMITTED.
SC RULING:
NO. Petitioners primarily question the probative value accorded to respondents letters of
explanation in response to the memorandum of the GSIS-IU Manager. The respondents never filed their
answers to the formal charges. The petitioners argue that there being no answers, the allegations in the
formal charges that they filed should have been deemed admitted pursuant to Section 11, Rule 8 of the
Rules of Court which provides:

SECTION 11. Allegations not specifically denied deemed admitted. Material

averment in the complaint, other than those as to the amount of liquidated damages, shall
be deemed admitted when not specifically denied. Allegations of usury in a complaint to
recover usurious interest are deemed admitted if not denied specifically and under oath.

According to the petitioners, this rule is applicable to the case at bench pursuant to Rule 1,
Section 4 of the Rules of Court which reads:

SECTION 4. In what cases not applicable. These Rules shall not apply to
election cases, land registration, cadastral, naturalization and insolvency proceedings,
and other cases not herein provided for, except by analogy or in a suppletory character
and whenever practicable and convenient. (underscoring supplied)

The Court does not subscribe to the argument of the petitioners. Petitioners own rules, Rule XI,
Section 4 of the GSIS Amended Policy and Procedural Guidelines No. 178-04, specifically provides:

If the respondent fails to file his Answer within five (5) working days from receipt of
the Formal Charge for the supporting evidence, when requested, he shall be considered
to have waived his right to file an answer and the PGM or the Board of Trustees, in proper
cases, shall render judgment, as may be warranted by the facts and evidence submitted
by the prosecution.

A perusal of said section readily discloses that the failure of a respondent to file an answer merely
translates to a waiver of his right to file an answer. There is nothing in the rule that says that the charges
are deemed admitted. It has not done away with the burden of the complainant to prove the charges with
clear and convincing evidence.
Even granting that Rule 8, Section 11 of the Rules of Court finds application in this case, petitioners must
remember that there remain averments that are not deemed admitted by the failure to deny the same.
Among them are immaterial allegations and incorrect conclusions drawn from facts set out in the
11
complaint. Thus, even if respondents failed to file their answer, it does not mean that all averments
found in the complaint will be considered as true and correct in their entirety, and that the forthcoming
decision will be rendered in favor of the petitioners. We must not forget that even in administrative
proceedings, it is still the complainant, or in this case the petitioners, who have the burden of proving, with
12
substantial evidence, the allegations in the complaint or in the formal charges.
A perusal of the decisions of the CA and of the CSC will reveal that the case was resolved against
petitioners based, not on the absence of respondents' evidence, but on the weakness of that of the
petitioners.
WHEREFORE, the assailed August 31, 2007 Decision of the Court of Appeals as well as its
October 16, 2007 Resolution in CA G.R. SP No. 98952 are hereby AFFIRMED.

LIAM LAW VS OLYMPIC SAWMILL

FACTS: It appears that on or about September 7, 1957, plaintiff loaned P10,000.00, without interest, to
defendant partnership and defendant Elino Lee Chi, as the managing partner. The loan became
ultimately due on January 31, 1960, but was not paid on that date, with the debtors asking for an
extension of three months, or up to April 30, 1960.On March 17, 1960, the parties executed another loan
document. Payment of the P10,000.00 was extended to April 30, 1960, but the obligation was increased
by P6,000.00Defendants again failed to pay their obligation by April 30, 1960 and, on September 23,
1960, plaintiff instituted this collection case. Defendants admitted the P10,000.00 principal obligation, but
claimed that the additional P6,000.00 constituted usurious interest.On January 18, 1961, an Order was
issued by the Trial Court stating that "after considering the manifestation of both counsel in Chambers,
the Court hereby allows both parties to simultaneously submit a Motion for Summary Judgment.On June
26, 1961, the Trial Court rendered decision ordering defendants to pay plaintiff "the amount of P10,000.00
plus the further sum of P6,000.00 by way of liquidated damages . . . with legal rate of interest on both
amounts from April 30, 1960." It is from this judgment that defendants have appealed.

ISSUE: WON claim of usury should have been deemed admitted by plaintiff as it was "not denied
specifically and under oath"?

RULING:
Under Article 1354 of the Civil Code, in regards to the agreement of the parties relative to the P6,000.00
obligation, "it is presumed that it exists and is lawful, unless the debtor proves the contrary". No
evidentiary hearing having been held, it has to be concluded that defendants had not proven that the
P6,000.00 obligation was illegal. Confirming the Trial Court's finding, we view the P6,000.00 obligation as
liquidated damages suffered by plaintiff, as of March 17, 1960, representing loss of interest income,
attorney's fees and incidentals.
The main thrust of defendants' appeal is the allegation in their Answer that the P6,000.00 constituted
usurious interest. They insist the claim of usury should have been deemed admitted by plaintiff as it was
"not denied specifically and under oath". 3
Section 9 of the Usury Law (Act 2655) provided:
SEC. 9. The person or corporation sued shall file its answer in writing under oath to any complaint
brought or filed against said person or corporation before a competent court to recover the money or
other personal or real property, seeds or agricultural products, charged or received in violation of the
provisions of this Act. The lack of taking an oath to an answer to a complaint will mean the admission of
the facts contained in the latter.
The foregoing provision envisages a complaint filed against an entity which has committed usury, for the
recovery of the usurious interest paid. In that case, if the entity sued shall not file its answer under oath
denying the allegation of usury, the defendant shall be deemed to have admitted the usury. The provision
does not apply to a case, as in the present, where it is the defendant, not the plaintiff, who is alleging
usury.