Rayo vs.

Metrobank, 539 SCRA 571

Under Section 2, Rule 3 of the Rules of Court, every action must be prosecuted or defended in the name of
the real party-in-interest, or one "who stands to be benefited or injured by the judgment in the suit."

A real party-in-interest is one with "a present substantial interest" which means such interest of a party in the
subject matter of the action as will entitle him, under the substantive law, to recover if the evidence is sufficient, or
that he has the legal title to demand.
Facts: WON Rayo has personality to sue. – NO.
Midas Diversified Export obtained loans from
Metrobank. To secure the payment of the loan, a Under Section 2, Rule 3 of the Rules of Court, every
mortgage was executed in favor of Metrobank over action must be prosecuted or defended in the
three parcels of land. When Midas failed to pay, name of the real party-in-interest, or one "who
Metrobank extrajudicially foreclosed the real estate stands to be benefited or injured by the judgment
mortgage. At the bidding, Metrobank acquired the in the suit."
property. Metrobank posted a bond required for
issuance of a writ of possession. Rayo, a co- A real party-in-interest is one with "a present
assignee of the property filed an action for substantial interest" which means such interest of
nullification of the sale. Metrobank opposed for the a party in the subject matter of the action as will
motion contending that he is not real party in entitle him, under the substantive law, to recover if
interest. the evidence is sufficient, or that he has the legal
title to demand.

Initially, it is recognized herein petitioner Rayo is a

co-assignee of the subject real properties.
However, while petitioner would be injured by the
judgment in this suit, that the petitioner has no
present substantial interest to institute the
annulment of judgment proceedings and nullify
the order granting the writ of possession. Rayo
would not be injured by the judgment. An ex-parte
application for a writ of possession not strictly
judicial process contemplated in article 443 of the
New Civil Code. It is a judicial proceeding for the
enforcement of one’s right of possession.

An ex parte application for a writ of possession is

not an ordinary suit filed in court, by which one
party "sues another for the enforcement of a wrong
or protection of a right, or the prevention or redress
of a wrong." It is a non-litigious proceeding
authorized in an extrajudicial foreclosure of
mortgage pursuant to Act No. 3135, as amended,
and is brought for the benefit of one party only,
and without notice to, or consent by any person
adversely interested. It is a proceeding where the
relief is granted without requiring an opportunity
for the person against whom the relief is sought to
be heard. No notice is needed to be served upon
persons interested in the subject property.

V-Gent, Inc. vs. Morning Start Travel and Tours, G.R. No. 186305 (July 22, 2015)
V-Gent purchased tickets from Morning Star but some were unused. Morning Star refused to refund some tickets.
V-Gent filed a money claim but Morning Star assailed its legal standing alleging that it is not a real party-in-
interest. SC held that V-Gent was an agent of the passengers and it is not a real party-in-interest because it didn’t
satisfy the requisites laid down in Rule 3, Sec. 3, ROC. A travel agent cannot sue in its own name to recover value
of unused tickets which it had bought in behalf of airplane passengers.

DOCTRINE:
General Rule: Every action must be prosecuted or defended in the name of the real party-in-interest. In
suits where an agent represents a party, the principal is the real party-in-interest; an agent cannot file a
suit in his own name on behalf of the principal.

Real Party-in-interest: the party who stands to be benefited or injured by the judgment in the suit.

Exception: Rule 3, Sec. 3 of the Rules of Court provides the exception when an agent may sue or be sued
without joining the principal.

Requisites:
1. The agent acted in his own name during the transaction
2. The agent acted for the benefit of an undisclosed principal
3. The transaction did not involve the property of the principal o
Facts: WON V-Gent is a real party-in-interest in filing
Petitioner V-Gent, Inc. purchased 26 2-way plane the complaint? NO.
tickets from Respondent Morning Star Travel and WON Morning Star is already estopped from
Tours. Subsequently, V-Gent returned 15 unused questioning V-Gent’s legal standing by virtue of
tickets. Of the 15, Morning Star refunded only 6 its initial refund? – NO.
tickets. It refused to refund the remaining 9 unused
tickets.
Issue of standing:
V-Gent filed a money claim against Morning Star A travel agent cannot sue in its own name to
in MeTC Manila. Morning Star contends that V- recover value of unused tickets which it had
Gent was not entitled to a refund because the bought in behalf of airplane passengers.
tickets were bought on a “buy one, take one”
promo as V-Gent had no personality to file the suit. V-Gent is not a real party-in-interest. Although
It argued that the real parties-in-interest are the Morning Star did not appeal the finding of MeTC
passengers in whose names the tickets were issued that V-Gent is a real party-in-interest, it doesn’t
mean that the ruling of MeTC on this point had
MeTC: Dismissed the case. It ruled that V-Gent, as already become final and conclusive. MeTC
agent of the passengers, stood as the real party-in- dismissed V-Gent’s complaint for failure to prove
interest. However, it failed to prove its claim by its claim.
preponderance of evidence.
General Rule: Every action must be prosecuted or
RTC: Reversed the MeTC decision. defended in the name of the real party-in-interest.
CA: Granted the petition for review of Morning In suits where an agent represents a party, the
Star. It ruled that V-Gent is not a real party-in- principal is the real party-in-interest; an agent
interest because it merely acted as an agent. cannot file a suit in his own name on behalf of the
principal.

Real Party-in-interest: the party who stands to be

benefited or injured by the judgment in the suit.
 Exception: Rule 3, Sec. 3 of the Rules of Court
provides the exception when an agent may sue or
be sued without joining the principal.

Requisites:
1. The agent acted in his own name during the
transaction
2. The agent acted for the benefit of an undisclosed
principal
3. The transaction did not involve the property of
the principal.

As applied in this case, only the first element is

present – the purchase order and receipt were in
the name of V-Gent. However, the two remaining
elements are absent. V-Gent disclosed the names of
the passengers – in fact the tickets were issued in
their names. The transaction was paid using
passengers’ money of the real party-in-interest are
the passengers.

On the issue of estoppel:

Morning Star is not estopped from claiming that
V-Gent is not the real party-in-interest. The power
to collect and receive payments on behalf of the
principal is an ordinary act of administration. On the
other hand, the filing of suits is an act of strict
dominion. By granting the initial refund, Morning
Star recognized V-Gent’s authority to buy the
tickets and collect refunds. However, this is not
equivalent to recognition of V-Gent’s authority to
initiate a suit.
Resident Marine Mammals vs. Sec. Reyes, G.R. No. 180771 (April 21, 2015)
Under the Procedure for Environmental Cases, any Filipino citizen to file an action before our courts for violations
of our environmental laws.
Facts: Whether the Petitioners (Resident Marine
The petitioners sought to enjoin respondents from Mammals and Stewards, FIDEC) have loci standi.
implementing Service Contract No. 46 and to have – YES.
it nullified for violating Sec 2 or Article 12 of the
1987 Constitution and other municipal and Petitioners (The Stewards) have standing.
international laws. The SC-46 would allow JAPEX
to conduct exploration and perform seismic The STEWARDS have legal standing. As to the
surveys in Tanon Strait, a NIPAS area. The first Resident Marine Mammals, the need to give them
petition was brought by Stewards on behalf of legal standing has been eliminated by our Rules,
resident marine mammals while the second which allow any Filipino citizen, as a steward of
petition was brought by Fisherfolk Development nature, to bring a suit to enforce our environmental
Center (FIDEC) on those whose livelihood will be laws.
impacted by the exploration activities. The case
was filed in 2007 after JAPEX began drilling The Rules of Court require that parties to a suit
activities. In 2008, JAPEX and the Government must be natural or juridical entities and are real
mutually terminated SC-46 and agreed to cease all parties-in-interest, even if filed by representative.
operations. Because of this, many environmental cases have

Hence the direct petition before the SC to nullify
the ECC, nullify and enjoin the implementation of
the SC-46 being contrary to the constitution. (no
public consultations were made prior to the
issuance of the ECC and contrary to international
laws deemed incorporated into our laws)
Case #1 Petitioners - \
(1) On behalf of toothed whales, dolphins,
porpoises, and other cetacean species,
which inhabit the waters in and around
the Tañon Strait (collectively referred as
"Resident Marine Mammals")
(2) Gloria Estenzo Ramos (Ramos) and Rose-
Liza Eisma-Osorio (Eisma-Osorio) as their
legal guardians and as friends (to be
collectively known as "the Stewards")
(3) PGMA was impleaded by petitioners as an
unwilling co-petitioner by reason of her
express declaration and undertaking
under the recently signed ASEAN Charter
to protect your Petitioners' habitat.
Case #2 Petitioners – FIDEC (fisherfolk NGO)
(1) The Court impleaded JAPEX Phil ltd as the
agent of JAPEX, a foreign corp. It argued
that the case is moot because they stopped
the exploration activities already.
Argument of Respondents: (1) Petitioners are not
real parties-in-interest. (2) Sec 1 Rule 3 of Rules of
Court require parties to an action to be either
natural or juridical persons.
Argument of Petitioners: (1) They claim they
stand to be benefited or injured by the judgment of
the suit (2) They assert their right to sue for the
faithful performance of international and
municipal environmental laws created in their
favor or benefit, citing the Oposa v Facturan Jr case.
(3) They have stakes in the case as forerunners in
the campaign to build awareness among affected
residents of Tanon Strait and as stewards of the
environment since the primary steward, the
Government, had failed in its duty to protect the
environment pursuant to the public trust doctrine.
been dismissed given the difficulty in proving that
environmentalists like the petitioners are real
parties-in-interests for environmental cases and
that they stand to be benefited or injured by the
outcome of the case. The Court though has
adopted a more liberalized approach in
determining locus standi of environmental cases.
Citizen Suit is now allowed, with the passing of
Rules for Procedure for Environmental Cases.
[Important to note that the Rules were passed
while the case was still pending in court.].
The Court passed the landmark Rules of Procedure
for Environmental Cases, which allow for a "citizen
suit," and permit any Filipino citizen to file an
action before our courts for violations of our
environmental laws.
SEC. 5. Citizen suit. - Any Filipino citizen
in representation of others, including
minors or generations yet unborn, may file
an action to enforce rights or obligations
under environmental laws. x x x
Rationale of passing this Rule: Humans are
stewards of nature.
Although this petition was filed in 1997, while the
Rules were issued in 2010, the rules being
procedural may be given retroactive effect.
Thus in this case, the STEWARDS, Ramos and
Eisma-Osorio, having shown in their petition that
there may be possible violations of laws
concerning the habitat of the Resident Marine
Mammals, are therefore declared to possess the
legal standing to file this petition. The Stewards are
joined as real parties in the Petition and not just in
representation of the named cetacean species.
The need to give the Resident Marine Mammals
legal standing has been eliminated by our Rules,
which allow any Filipino citizen, as a steward of
nature, to bring a suit to enforce our
environmental laws. (In other words, the Resident
Mammals themselves were not recognized to have legal
standing, as the humans representing them can sue in
their own right as stewards of nature.)
Pres. Arroyo cannot be impleaded as co-
petitioner.
 As to the inclusion of PGMA (incumbent President) as
unwilling co-petitioner, the Court ruled that since
Petitioners were unable to get her consent, PGMA
cannot be included as co-petitioner. The President
enjoys immunity from suit, and cannot be sued
without her consent.

Pres. Arroyo cannot be impleaded as an unwilling

co-petitioner for an act she made in the
performance of the functions of her office, is
contrary to the public policy against embroiling the
President in suits, "to assure the exercise of
Presidential duties and functions free from any
hindrance or distraction, considering that being
the Chief Executive of the Government is a job that,
aside from requiring all of the office holder's time,
also demands undivided attention.
Magallanes vs. Palmer Asia, G.R. No. 205179 (July 18, 2014)
Andrews Inc. filed a BP 22 complaint against its Sales Agent Magallanes. While the case was pending,
Andrews Inc. transferred the control of its business operations to Palmer Asia Inc., which was basically the
same company with a different name. Andrews Inc. nevertheless continued to exist. When the RTC ruled in
favor of Magallanes, Palmer Asia was the one who appealed the decision, thus Magallanes now asserts that
Palmer Asia lacked the personality to appeal since it was not the party in interest, but rather the original
Andrews Inc, which still existed but was for all its business transaction purposes, considered defunct.
Facts: WON the CA is correct in entertaining the appeal
Andrews International Product Inc. filed by Palmer. – NO.
(Andrews) is a corporation that manufactures
While Palmer filed a petition for review before the
and sells fire extinguishers, while Magallanes
CA, it is not the real party-in-interest, and it was
was their Sales Agent. Magallanes negotiated
never a party-in-interest to the proceedings in the
with 3 buyers who issued checks payable to
trial court. Under procedural law, a case is
him. However, these checks bounced and were
dismissible for lack of capacity to sue upon proof
returned to him. To obtain his commissions,
that the party is not a real party-in-interest, hence
Magallanes signed Sales Invoices covering the
grounded on the lack of cause of action.
fire extinguishers that were intended to be sold
to the prospective buyers, and he also issued
In this instance, Magallanes was correct in
five (5) checks covering the purchase price of
claiming that the only real party-in-interest who
the items. However, Magallanes’ checks were
has impliedly instituted the civil action was
dishonored upon presentment to the bank.
Andrews, and the fact that the Information for B.P.
22 had no mention of Palmer shows that Palmer
In 1995, Andrews and Respondent Palmer was not a party to the suit.
Asia, Inc. (Palmer) agreed that the former
would have the latter run their businesses, Section 2 of Rule 3 of the ROC is instructive.
Palmer being the renamed company to appeal
to a larger and more sophisticated market. In Goco v. CA, the Court ruled that Sec. 2, Rule3
Being a family corporation and since the has two requirements:
change of name was more of a marketing 1. To institute an action, the plaintiff must be
strategy, all legal niceties were dispensed with. the real party-in-interest, and “interest”
Nevertheless, Andrews was neither dissolved within the meaning of the Rules of Court
nor liquidated, just merely not doing anything means material and direct interest;
since Palmer took over all operations.

According to Magallanes, Andrews demanded
payment of the value of the checks. Since the
demands were unheeded, Magallanes was
charged with several counts of violation of BP
22. Case was docketed in MTC of Makati City,
and Palmiery was authorized to file suit on
behalf of Andrews, represented by the latter’s
counsel.
In the pleadings, there was no mention of the
relationship between Andrews and Palmer.
Lastly, there was no registry receipt or stamp
or signature or any other mark which could
indicate that Magallanes was furnished a copy
of the document.
Palmiery appeared before the MeTC Branch 62 and
explained that Andrews transferred its assets, and
relinquished control of its operations to Palmer,
and Magallanes filed a motion to strike out
Palmiery’s Testimony. According to Magallanes,
since the assets and credits of Andrews were
transferred to Palmer, the real party in interest in
this case is Palmer and not Andrews. Therefore, the
criminal case should have been instituted by
Palmer. Palmer opposed, saying the current
situation was a marketing strategy, as Andrews
International’s business thus operated under the
banner of Palmer Asia. Palmer Asia had exactly the
same officers, occupied the same business office,
retained all its employees and agents, had the same
customers and sold the same products.
The MTC denied the motion of Magallanes for lack
of merit. Magallanes appealed the decision to the
RTC which ruled in his favor.Palmer thus filed a
motion for Reconsideration, which was denied by
the RTC, but upon appeal to the CA, the Court
ruled against Magallanes.
2. The action must be prosecuted in the name
of the real party-in-interest
One having no material interest to protect cannot
invoke the jurisdiction of the court as the plaintiff
in an action.
Parties who are not the real parties in interest may
be included in a suit in accordance with the
provisions of Section 3 of Rule 3 of the Rules of
Court:
Sec. 3. Representatives as parties. Where the action
is allowed to be prosecuted or defended by a
representative or someone acting in a fiduciary
capacity, the beneficiary shall be included in the
title of the case and shall be deemed to be the real
party in interest. A representative may be a trustee
of an express trust, a guardian, an executor or
administrator, or a party authorizedby law or these
Rules. An agent acting in his own name and for the
benefit of an undisclosed principal may sue or be
sued without joining the principal except when the
contract involves things belonging to the principal.
The CA erred in stating that Palmer and Andrews
are the same entity. These are two separate and
distinct entities claiming civil liability against
Magallanes. Although Andrews relinquished
control of its business to Palmer, it was never
dissolved and thus remained existing. Given the
foregoing facts, it is clear that the real party in
interest here is Andrews. Following the Rules of
Court, the action should be in the name of
Andrews. As previously mentioned, Andrews
instituted the action before the MeTC Branch 62
but it was Palmer which filed a petition for review
before the CA.
This case involves two separate and distinct
entities. The corporation that initiated the
complaint for B.P. 22 is different from the
corporation that filed the memorandum at the RTC
and the petition for review before the CA. It
appears that Palmer is suing Magallanes in its own
right, not as agent of Andrews, the real party in
interest.
Even assuming arguendo that Palmer is correct in
asserting that it is the agent of Andrews, the latter
 should have been included in the title of the case,
in accordance with procedural rules.

Aguila vs. Court of Appeals, 319 SCRA 345

Alfredo Aguila, as managing partner of AC Aguila & Sons, entered into a Memorandum of Agreement with
Abrogar. As stipulated in the agreement, AC Aguila was able to acquire the properties after Abrogar’s non-payment
of her debts. Abrogar then filed a case against Alfredo Aguila for the nullity of the deed of sale. SC then ruled that
Aguila is not the real party in interest. It should be the partnership, and not the agents/officers, which
should be impleaded in any litigation involving property registered in its name. A complaint filed
against a party who is not a real party in interest SHOULD BE DISMISSED for Failure to State Cause
of Action.
Facts: WON managing partner Alfredo Aguila, Jr. is the
real party in interest in this case. NO, the
Alfredo Aguila is the managing partner of AC partnership is the real party-in-interest.
Aguila & Sons, a partnership engaged in the
lending business. On April 18, 1991, it entered into Alfredo Aguila Jr is not the real party in interest;
a Memorandum of Agreement (MoA) with Aguiila & Sons Co. is.
Felicidad Abrogar (with husband’s consent): o AC
Aguila shall buy Abrogar’s house and lot in RoC, Rule 3, Sec. 2: Every action must be
Marikina for P200K, executing a Deed of Absolute prosecuted and defended in the name of the real
Sale. party in interest. A real party in interest is one who
would be benefitted or injured by the judgment, or
Abrogar has the option to repurchase the property who is entitled to the avails of the suit
for P230K, 90 days from execution of the MOA o
Failure to exercise this option, Abrogar is obliged Any decision rendered against a person who is not
to deliver peacefully the possession of the property a real party in interest in the case cannot be
to AC Aguila & Sons. The MoA will then be executed.
deemed cancelled and the aforementioned Deed of
Absolute Sale shall be the final contract considered Art 1768, NCC: “A partnership has a juridical
as between the contracting parties. On the same personality separate and distinct from each of the
day (Apr 18 1991): - The parties executed a Deed of partners.” The partners cannot be held liable for
Absolute Sale (DAS), selling the properties to AC the obligations of the partnership unless it is show
Aguila for P200K. - Abrogar issued a Special Power that the legal fiction of a different juridical
of Attorney (SPA), authorizing Alfredo Aguila to personality is being used for fraudulent, unfair, or
cause the cancellation of Abrogar’s TCT and the illegal purposes.
issuance of a new TCT in the name of the
partnership. CAB: Abrogar has not show that AC Aguila & Sons
is being used for such purposes. Moreover, the title
Abrogar did not redeem the property within the to the subject property is in the name of AC Aguila
90-day period provided in the MoA. Thus, Aguilar & Sons. The MoA was also executed between the
caused the cancellation of her TCT and sought a partnership (represented by Aguila) and Abrogar.
new one, pursuant to the SPA. However, despite
demands, Abrogar did not vacate her property. It should be the partnership, and not the
Thus, the partnership filed an ejectment suit agents/officers, which should be impleaded in any
against her. In this line of cases, the MTC-Marikina, litigation involving property registered in its
RTC-Pasig, CA, and SC all ruled against Aborgar. name.
Abrogar also filed a criminal complaint for
falsification against Aguila, but Office of QC
Prosecutor dismissed the case.
Abrogar then filed a petition for declaration of
nullity of a deed of sale before RTC-Marikina,
claiming that her husband’s signature on the DAS
was forged. The DAS was dated Jun 11 1991 but
Mr. Abrogar died on May 8 1991 o RTC ruled in
favor of Aguila. CA reversed.
Samaniego vs. Aguila, 334 SCRA 438
INDISPENSIBLE PARTY: a party-in-interest without whom no final determination can be had of an action
without that party being impleaded. o Those with such an interest in the controversy that a final decree would
necessarily affect their rights, so that the court cannot proceed without their presence.
INTEREST: material, directly in issue and to be affected by the decree as distinguished from mere incidental
interest.
NOMINAL/PRO FORMA PARTY: one joined as a plaintiff/defendant, not because such has any real interest in
the subject matter or because any relief is demanded but merely because technical rules of pleadings require the
presence of such party on the record. (ex. Office of the President, Court of Appeals in special civil actions for
certiorari) - *

Necessary Party: failure to comply with the order for the party’s inclusion will be deemed a waiver to claim against
such party. The Court is not prevented from proceeding with the action. However, judgment rendered therein will
not prejudice such necessary party. Failure to implead such party will not amount to dismissal of the action.
Indispensible Party: failure to comply with the order for the party’s inclusion will be a cause for dismissal for
Failure to Comply with an Order of the Court and not because of misjoinder/non-joinder. (See § 11 Rule 3) .
Facts: Whether the Office of the President is an
Samaniego et. al. are tenants in a landholding that indispensable party in an appeal from its
belongs to Salud Aguila. The land in question was decision and, therefore, must be impleaded
identified by the DAR-Region 2 as covered by the pursuant to the Rules of Civil Procedure. – NO.
Operation Land Transfer Program of the
government. Aguila, in behalf of her children, filed Under Rule 7, Section 3 of the Rules of Civil
a petition for exemption from the coverage of P.D. Procedure, an indispensable party is a party in
No. 27. Samaniego et. al. opposed the application interest without whom no final determination can
on the ground that Aguila's transfer of the title to be had of an action without that party being
the lands to her children was in violation of the impleaded. Indispensable parties are those with
rules and regulations of the DAR.The Regional such an interest in the controversy that a final
Director granted the application for exemption. On decree would necessarily affect their rights, so that
appeal to the DAR, the decision was affirmed. the court cannot proceed without their presence.
However, on motion of petitioners, the DAR "Interest", within the meaning of this rule, should
reversed its ruling and denied Aguila’s application be material, directly in issue and to be affected by
for exemption and declared petitioners the rightful the decree, as distinguished from a mere incidental
farmer-beneficiaries of the land. Aguila appealed interest in the question involved. On the other
to the Office of the President which declared that hand, a nominal or pro forma party is one who is
subject landholdings are not covered by the OLT joined as a plaintiff or defendant, not because such
program of the government pursuant to P.D. No. party has any real interest in the subject matter or
27. Aguila et. al appealed to the Court of Appeals, because any relief is demanded, but merely
but their petition was dismissed on the ground that because the technical rules of pleadings require the
the Office of the President is an indispensable party presence of such party on the record. In the case at
to the case. Failure to implead said Office is fatal to bar, even assuming that the Office of the President
the petitioners' cause and, hence, should be should have been impleaded by petitioner, it is
dismissed. clear that the Office of the President is merely a pro
forma party, in the same way that a respondent
court is a pro forma party in special civil actions for
certiorari.
Domingo vs. Scheer, 421 SCRA 468
The joinder of indispensable parties is mandatory. Without the presence of indispensable parties to the suit, the
judgment of the court cannot attain real finality. The absence of an indispensable party renders all subsequent
actions of the court null and void. Lack of authority to act not only of the absent party but also as to those present.
The responsibility of impleading all the indispensable parties rests on the petitioner.

However, the non-joinder of indispensable parties is not a ground for the dismissal of an action. Parties may be
added by order of the court on motion of the party or on its own initiative at any stage of the action and/or such
times as are just.
Facts: WON BOC is an indispensable party – YES.
1. Herbert Markus Emil Scheer, a native of
Ochsenfurt, Germany, was a frequent visitor of BOC was an indispensable party to the
the PH. He was then subsequently granted an respondents petition for certiorari, prohibition and
Alien Certificate of Registration and mandamus in the Court of Appeals. The respondent
Immigration Certificate of Residence. He then was arrested and detained on the basis of the
married a Filipina and lived in Puerto Summary Deportation Order of the BOC. The
Princessa, Palawan. petitioner caused the arrest of the respondent in
2. In a letter, vice consul Hippelein informed the obedience to the said Deportation Order.
PH Ambassador to Germany that Scheer had
police records and financial liabilities in Scheer also prayed that the CA issue a writ of
Germany. mandamus for the immediate resolution of his
3. DFA then received from the German Embassy Urgent Motion for Reconsideration. The said
Note Verbale 369/95 informing it that Scheer motion had to be resolved by the BOC as the order
was wanted by the German Federal Police and sought to be resolved and reconsidered was issued
that a warrant was issued for his arrest. by it and not by the Domingo alone.
Thereafter, BOC issued a Summary
Deportation Order dated Sept 27, 1997. Section 7, Rule 3 of RoC, requires indispensable
4. Scheer filed an Urgent MR of the Summary parties to be joined as plaintiffs or defendants. The
Deportation Order of BOC. joinder of indispensable parties is mandatory.
5. The District Court of Straubing rendered a Without the presence of indispensable parties to
decision dismissing the criminal case against the suit, the judgment of the court cannot attain
Scheer. He was then issued a temporary real finality. The absence of an indispensable party
passport by the German Embassy. Scheer then renders all subsequent actions of the court null and
requested for the cancellation of the void. Lack of authority to act not only of the absent
deportation order. party but also as to those present. The
6. Despite this, the BOC failed to act on Scheer’s responsibility of impleading all the indispensable
MR. Then on June 6, 2002, Marine operative parties rests on the petitioner.
and BID agents apprehended Scheer in his
residence on the orders of Comm. Domingo. However, the non-joinder of indispensable parties
He was detained in the BID Manila Office to is not a ground for the dismissal of an action.
await his deportation. Parties may be added by order of the court on
7. Scheer’s lawyer filed with the CA a petition for motion of the party or on its own initiative at any
certiorari, prohibition, and mandamus with a stage of the action and/or such times as are just.
prayer for TRO and WPI to enjoin Domingo
from proceeding with the deportation. In Salvador vs CA, the court held that it has full
8. During the hearing the WPI, the OSG powers, apart from that power and authority
manifested that the State had no opposition the which is inherent, to amend the processes,
Scheer’s re-entry and stay in the PH, provided pleadings, proceedings and decisions by
that he leave the country first and re-apply for substituting as party-plaintiff the real party-in-
admission and residency with the assurance interest. The Court has the power to avoid delay in
that he would be re-admitted. the disposition of this case, to order its amendment
9. In Domingo’s comment, she alleged that the as to implead the BOC as party-respondent.
BOC was an indispensable party to the case
 and that Scheer’s failure to implead it But it may not be necessary to implead BOC in the
warranted the denial of the petition. case at bar. After all, the OSG has represented
10. CA ruled for Scheer and quoted Caruncho III Domingo in the instant proceedings, as well as in
vs. COMELEC, where it was pronounced that: the appellate court, and maintained the validity of
Ordinarily, the non-joinder of an the deportation order and of the BOC’s Omnibus
indispensable party or the real party interest is Resolution. It cannot, thus, be claimed by the State
not by itself a ground for the dismissal of the that the BOC was not afforded its day in court,
petition. The court before which the petition is simply because only Domingo, the Chairperson of
filed must first require the joinder of such the BOC, was the respondent in the CA.
party. It is the noncompliance with said order
that would be a ground for the dismissal of the
petition.
11. Thus this Rule 45 petition
MBTC vs. Rural Bank of Gerona, G.R. No. 159097 (July 5, 2010)

RBG entered into an agreement with Central Bank,
wherein RBG shall facilitate the loan applications
of farmers-borrowrs under a project of Central
Bank (International Bank for Reconstruction and
Developments Rural Credit Project)
This required RBG to open up a separate Bank
account where the IBRD loan proceeds would be
deposited. The account was opened in Metrobank.
Metrobank was designated to receive the credit
advice released by Central Bank,representing the
proceeds of the IBRD loans. In turn Metrobank
would credit the proceeds to RBGs special savings
account
Central Bank released 3 credit advices in
Metrobanks favor, for the approved loans of
Dominador De Jesus (178.6K) , Basilio Panopio
(189K), and Ponciano Lagman (220,000). The above
amounts were credited to Metrobanks demand
deposit account, which Metrobank later credited in
favor of RBG’s special savings account. Central
Bank later issued debit advices, REVERSING all
approved IBRD loans.
This was implemented by DEBITING from
Metrobanks demand deposit account. Metrobank
in turn debited the amounts from RBGs special
savings account. (189K, 115K, and 8k).
Metrobobank however claimed that these amounts
were insufficient to cover all the credit advices that
were reversed by Central Bank.
It then demanded payment from RBG, claiming
that RBG had an outstanding balance of 334K.
WON it was necessary to implead Central Bank
as a Necessary party. – NO. Metrobank
subrogated as creditor.
It is important to determine who is liable for the
losses suffered by Metrobank. According to the
IBRD project terms and conditions, executed
between RBG and Central Bank shows that the
farmer-borrowers were to be primarily liable for
the payment of the borrowed amounts.
However, RBG assumed liability under the Project
Terms and Conditions when it bound itself
solidarily with the farmers. Central Banks recourse
then should have been against the farmer
borrowers and RBG. Metrobank was a stranger to
the contract and had no responsibility over the
proceeds of the IBRD loans.
However there was a presumption of legal
subrogation as laid down in Article 1302 of the CC
section 2 o Article 1302: It is presumed that there is
legal subrogation:
- When a creditor pays another creditor who
is preferred, even without the debtors
knowledge;
- When a third person, not interested in the
obligation, pays with the express or tacit
approval of the debtor;
- When, even without the knowledge of the
debtor, a person interested in the
fulfillment of the obligation pays, without
prejudice to the effects of confusion as to
the latters share.

RTC ruled for Metrobank. CA reversed, stating
that IT WAS NOT A CASE OF LEGAL
SUBROGATION and that furthermore that Central
Bank should be impleaded as a NECESSARY
party. It remanded the case to the RTC.
Co vs. Acosta, 134 SCRA 185
RBG did not protest when Metro debited amounts
from RBGs special savings account. This indicates
their approval. Hence Metro was subrogated to all
the rights of Central Bank and has a cause of ation
to recover from RBG. Hence impleading Central
Bank as a party is UNNECESSARY.

Agro Conglomerates vs. CA, 348 SCRA 450

Plasabas vs. Court of Appeals, 582 SCRA 686

Article 487 of the Civil Code provides that any one of the co-owners may bring an action for ejectment. The article
covers all kinds of actions for the recovery of possession, including an accion publiciana and a reivindicatory action.
A co-owner may file suit without necessarily joining all the other co-owners as co-plaintiffs because the suit is
deemed to be instituted for the benefit of all. Any judgment of the court in favor of the plaintiff will benefit the other
co-owners, but if the judgment is adverse, the same cannot prejudice the rights of the unimpleaded co-owners.

The non-joinder of indispensable parties is not a ground for the dismissal of an action. the remedy is to
implead the non-party claimed to be indispensable. parties may be added by order of the court on motion of the
party or on its own initiative at any stage of the action and/or at such times as are just. If petitioner refuses to
implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition for the
plaintiff's/petitioner's failure to comply therewith
Petitioners filed a complaint for recovery of title to WON the petitioners have to implead their co-
property with damages before the CFI — the owners as indispensable parties. – YES.
property subject of the case was a parcel of coconut a. the exception to the rule under Art.
land declared in the name of Nieves. They prayed 487 is when the action is for the benefit
that their rights and legal title to the property be of the plaintiff alone who claims to be
confirmed and that the defendants be ordered to the sole owner and is, thus, entitled to
vacate the premises the possession thereof. In such a case,
a. Respondents: claimed that the land the action will not prosper unless the
was inherited by all the parties from plaintiff impleads the other co-owners
their common ancestor (Francisco who are indispensable parties. (but
Plasabas) this isn’t the case here)
b. the petitioners’ allegation that they are
During the course of the trial, it was revealed that the sole owners is immaterial
Nieves was not the sole and absolute owner of the considering that they acknowledged
land contrary to her allegations in the complaint. during the trial that the property is co-
Based on the testimonies of her witnesses, the owned by Nieves and her siblings and
property was passed down the line from Francisco that the petitioners were authorized to
(her great great grandfather?) eventually to pursue the case on their behalf — suit
Nieves and her siblings: Jose, Victor and Victoria is deemed to be instituted for the
benefit of all
Respondents argued that the case should have c. the CFI and CA committed reversible
been terminated at inception for petitioners’ failure error when they summarily dismissed
to implead indispensable parties (the other co- the case on the ground of failure to
owners) implead indispensable parties:
i. the rule is that the non-
joinder of indispensable
Trial court dismissed the case without ruling on parties is not a ground for
the merits for failing to comply with sec. 7, Rule 3, the dismissal of an action.
ROC regarding the compulsory joinder of the remedy is to implead the
indispensable parties. It held: non-party claimed to be
- the petitioners have no complete legal indispensable. Parties may
personality to sue by themselves alone be added by order of the
without joining the other co-owners who court on motion of the party
are as indispensable as Nieves in the final or on its own initiative at
determination of the case. Any judgment any stage of the action
rendered without them would have no and/or at such times as are
effectiveness and are indispensable just. If petitioner refuses to
because a final decree would necessarily implead an indispensable
affect their rights party despite the order of
the court, the latter may
- the general rule in a civil action requires
dismiss the
the joinder of ALL indispensable parties,
complaint/petition for the
their presence being a sine qua non of the
plaintiff's/petitioner's
exercise of judicial power. Failure to
failure to comply therewith.
follow this rule makes it the duty of the
court to suspend the trial until all
indispensable parties are impleaded or
dismiss the case
- The burden of procuring the presence of
all indispensable parties is on the plaintiff
— this rule seeks to prevent the
multiplicity of suits

An indispensable party is a party who has such an

interest in the controversy or subject matter that a
final adjudication cannot be made, in his absence,
without inquiring or affecting such interest; a party
who has not only an interest of such a nature that
a final decree cannot be made without affecting his
interest or leaving the controversy in such a
condition that its final determination may be
wholly inconsistent with equity and good
conscience.

The CA affirmed the RTC decision, further

declaring that:
- the non-joinder of indispensable parties
would violate due process
- Article 487 of the civil code cannot be
applied because the complaint is for
recovery of title and not ejectment
Erna Casals, et al vs. Tayud Golf and Country Club, 593 SCRA 468
Parties; indispensable parties. Rule 3, Section 7 of the Rules of Court, defines indispensable parties as parties-in-
interest without whom there can be no final determination of an action. As such, they must be joined either as
plaintiffs or as defendants. The general rule with reference to the making of parties in a civil action requires, of
course, the joinder of all necessary parties where possible, and the joinder of all indispensable parties under any and
all conditions, their presence being a sine qua non for the exercise of judicial power. It is precisely “when an
indispensable party is not before the court [that] the action should be dismissed.” The absence of an indispensable
party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent
parties but even as to those present.

Senator Pimentel, et al vs. Senate Committee, G.R. No. 187714, March 8, 2011
Test for indispensable party (a list of criteria actually):
a. Final adjudication cannot be done without that party without injuring or affecting his/her
interest
b. If it were decided without the party, it will be inconsistent with equity and good conscience
c. Party must be included in the action before the action can move forward
d. It is not sufficient reason that the presence of the party will avoid multiple litigations
Senate President Manny Villar is accused of having WON Madrigal an indispensable party.- NO.
a congressional insertion in the General
Appropriations Act (GAA) of 2008 which 2. Madrigal is not an indispensable party in
effectively doubled the budget of the C5 extension interest as it can be resolved without her
project. The Senate creates a committee to handle interest as it is a matter of procedure on the
the investigation but is met with unwillingness. Senate Committee of the Whole. In order
to answer this, the case sets out the test for
A petition for prohibition with prayer for issuance indispensable party (a list of criteria):
of a preliminary injunction is filed with the a. Final adjudication cannot be done
Supreme Court by the above-mentioned without that party without
petitioners. Lacson delivered a privilege speech injuring or affecting his/her
entitled Kaban ng Bayan Bantayan! (15 September interest
2008). He called attention to the congressional b. If it were decided without the
insertion in the appropriated in the GAA 2008 party, it will be inconsistent with
particularly President Carlo P. Garcia Avenue equity and good conscience
Extension from Sucat Luzon Expressway to Sucat c. Party must be included in the
Road in Parañaque City including Right of Way action before the action can move
(ROW) which is Php 200 Million and another Php forward
200 Million appropriated for the extension of the d. It is not sufficient reason that the
C5 road including ROW which is the same as the presence of the party will avoid
Carlo P. Garcia Avenue Extension project multiple litigations
mentioned earlier (CP Garcia Avenue is the old
name of C5). Lacson inquired with the then
Department of Budget and Management (DBM)
Secretary Andaya regarding the double entry for
the project and was informed that this was on
account of a congressional insertion. Lacson
further stated that when he followed the narrow
trail leading to the double entry, it led to then
Senate President Manny Villar.

On 08 October 2008, Senator Madrigal introduced

Senate Resolution No. 706 which discussed the
following points:

- The alleged double insertion in the 2008

GAA
- That the C5 Road Extension issue is only
the tip of the iceberg when it comes to the
issues surrounding Villar
- That Villar allegedly ensured that the C5
project will pass through his properties in
 San Dionisio, Parañaque, Barangay Pulang
Lupa, Mayo Uno, Las Piñas which will
make him earn from the ROW settlements
- That the price of the land that he will
subject to ROW is overpriced and
prejudicial to the lot owners
- That this is in complete violation of the
Anti-graft and Corrupt Practices Act

On the same date, P.S. No. 706 was referred to the

Committee on Ethics and Privileges. However,
there was a change in the Senate presidency as on
17 November 2008, the Senate President was now
Enrile. Thus the Committee was re-organized (the
members stated earlier). The committee still lacks
two members from the Senate minority

16 December 2008 – Lacson asks Pimentel of the

minority on who their representatives were.
Pimentel answered that there were none.

23 March 2009 – Senate adopted the Rules of the

Senate Committee on Ethics and Privileges

20 April 2009 – in a privilege speech, Villar said

that he would answer the accusations against him
on the floor but not before the Ethics Committee

27 April 2009 – Lacson, in a privilege speech, said

that their committee is not a kangaroo committee,
but due to the accusation that they are not
impartial, moved that the responsibility be with
the Senate acting as a Committee of the Whole.

Motion was approved with a 5-0-5 vote (5 for, 0

against, 5 abstain)

Petitioners came to SC for relief and petitioned and

raised the following:
- The transfer of the complaint from the
Senate Committee on Ethics and Privileges
to the Senate Committee of the Whole
violated the equal protection of Villar
- Adopting of the rules was against the
majority requirement under Article 6,
Section 16(2) and was against Villar’s right
to due process
- That the Senate Committee of the Whole
violated due process when it refused to
publish the Rules of the Senate Committee
in spite of its clause regarding publication
Respondent made the following comments:
- Petition should fail due to its failure to
implead indispensable party – moved to
archive it first until an indispensable
party has been impleaded
- There was no grave abuse of discretion by
the committee
- Petitioner is not entitled to write of
prohibition as he cannot prove the alleged
grave abuse
- Separation of powers doctrine
- Premature due to the primary jurisdiction
doctrine
- It is within the power of Congress to
discipline its members
- The question on what “disorderly
behavior” is a political question and not a
justiciable one and should be left to
Congress to decide
- Internal rules are not subject to judicial
review in the absence of grave abuse of
discretion
Kilosbayan vs. Guingona, G.R. No. 113375, May 5, 1994
The person who impugns the validity of a statue must have a personal and substantial interest in the case such that
he has sustained or will sustain direct injury as a result of its enforcement. However, a party’s standing before
the SC is a procedural technicality which may, in the exercise of the court’s discretion, be set aside in
view of the importance of the issues raised (i.e. its transcendental importance)
1. the PCSO established an online lottery system WON the petitioners have locus standi — YES
to increase its revenue and diversify the source a. The person who impugns the validity
of its funds (pursuant to its charter). The of a statue must have a personal and
computer systems, softwares, terminals and substantial interest in the case such
training. that he has sustained or will sustain
2. Berjaya Group became interested in offering its direct injury as a result of its
services to the PCSO so it organised the enforcement. However, a party’s
Philippine Gaming Management Corporation standing before the SC is a
(PGMC) with Filipino investors which would procedural technicality which may,
serve as the medium through which the in the exercise of the court’s
technical and management services for the discretion, be set aside in view of the
project could be offered and delivered to PCSO importance of the issues raised (i.e. its
3. PCSO issued a request for proposal (RFP) for transcendental importance)
the Lease Contract of an online lottery system. i. jurisprudence was cited
Under the RFP, the contractor would build all essentially illustrating and
the facilities needed for the online lottery justifying the propriety of the
system for not more than 15 years. It also court’s actions in setting
required that the lessor be a domestic aside the requirements of
corporation with at least 60% of its shares locus standi when faced with
owned by Filipino shareholders constitutional questions of
4. PGMC submitted its bid to the PCSO and the transcendental importance
Office of the President (OP) announced that it such as whether or not the
gave the PGMC the go-signal to operate the other branches of
online lottery system. This announcement was government adhered to the
 published in the Manila Standard, PH Daily limits of the constitution
Inquirer, and Manila Times imposed upon them
5. Kilosbayan sent an open letter to President ii. in line with the liberal policy
Ramos opposing the setting up of the online of the court on locus standi,
lottery system on the basis of serious moral ordinary taxpayers,
and ethical considerations. Despite the members of congress,
opposition faced by the project, it was reported associations and non-profit
by the media that the lottery system was to civic organisations were
push through and that the PCSO would allowed to initiate and
actually operate the lottery while the winning prosecute actions before the
corporate bidders were merely lessors court to question the
6. Kilosbayan requested for copies of all constitutionality or validity
documents pertaining to the lottery award of laws, acts, decisions,
from the Executive Secretary but before they rulings or orders of various
were able to receive them, a Contract of Lease government agencies or
was executed by PCSO and PGMC (note that instrumentalities.
PGMC was one of 3 lessors involved in the a. the present petition was found to be of
contract) transcendental importance to the public because
7. Apparently, the OP denied the protest of the issues it raised were of paramount public
Kilosbayan and the Assistant Executive interest for having possible effects on the social,
Secretary (Renato Corona) said that only a economic and moral well-being of the people even
court injunction could stop Malacanang’s in the remotest barangays of the country and
implementation of the Contract so Kilosbayan potentially having counter-productive and
and its co-petitioners filed the present petition. retrogressive effects even in the face of the
They claimed that the OP acted in GAOD in potential billions in revenue that it was meant to
approving the award of the contract and in raise
entering into the contract of lease with
PGMC because:
a. sec. 1 of PCSO’s charter prohibits them
from holding and conducting lotteries
in collaboration, association or joint
venture with any person, association,
company or entity
b. Under Act No. 3846 and
jurisprudence, a congressional
franchise is required before any
person may be allowed to establish
and operate a telecommunications
system (the contract of lease required
the lessor to establish a
telecommunications network that
would connect all the municipalities
and cities)
c. Under sec. 11, Art. XII of the
Constitution, a corporation that is less
than 60% Filipino-owned and/or
controlled like the PGMC (argued to
be 75% foreign-owned or controlled,
indicated by its Articles of
Incorporation) is disqualified from
operating a public service like the
telecommunications system
 i. the Foreign Investments Act
provides that only 40%
foreign capital is allowed in
all forms of gambling
(including a lottery)
d. PGMC is not authorized by its charter
and the Foreign Investments Act to
install, establish and operate the
online lotto and telecommunications
system
8. PGMC: (1) it is merely an independent
contractor for a piece of work (the building and
maintenance of a lottery system) and therefore
not a co-operator of the lottery franchise with
PCSO. (2) as an independent contractor for a
piece of work, it is not engaged in gambling
nor in public service (in relation to the
telecommunication network) (3) the contract
does not violate the constitution and the laws
(4) the issue on the morality of the lottery
franchise granted to the PCSO is political (4)
petitioners do not have the legal standing or
real interest in the contract and in obtaining
the reliefs sought (also argued by the OSG)
Intellectual Property Association vs. Ochoa, G.R. No. 204605 (July 19, 2016)

Velarde vs. Social Justice Society, G.R. No. 159357, April 8, 2004
Legal standing or locus standi has been defined as a personal and substantial interest in the case, such that
the party has sustained or will sustain direct injury as a result of the challenged act.
On January 28, 2003, SJS filed a Petition for =WON petitioners had legal standing. – NO.
Declaratory Relief before the RTC-Manila against
Velarde and his co-respondents Eminence, Jaime Legal standing or locus standi has been defined as
Cardinal Sin, Executive Minister Eraño Manalo, a personal and substantial interest in the case,
Brother Eddie Villanueva and Brother Eliseo F. such that the party has sustained or will sustain
Soriano. direct injury as a result of the challenged act.

SJS, a registered political party, sought the
interpretation of several constitutional provisions,
specifically on the separation of church and state;
and a declaratory judgment on the
constitutionality of the acts of religious leaders
endorsing a candidate for an elective office, or
urging or requiring the members of their flock to
vote for a specified candidate.
Interest means a material interest in issue that is
affected by the questioned act or instrument, as
distinguished from a mere incidental interest in the
question involved.
SJS has no legal interest in the controversy and
has failed to establish how the resolution of the
proffered question would benefit or injure it.

The petitioner filed a Motion to dismiss before the Parties bringing suits challenging the
trial court owing to the fact that alleged that the constitutionality of a law, an act or a statute must
questioned SJS Petition did not state a cause of demonstrate that they have been, or are about to
action and that there was no justiciable be, denied some right or privilege to which they
controversy. are lawfully entitled, or that they are about to be

The trial court’s junked the Velarde petitions under
certain reasons:
It said that it had jurisdiction over the SJS petition,
because in praying for a determination as to
whether the actions imputed to the respondents
were violative of Article II, Section 6 of the
Fundamental Law, the petition has raised only a
question of law.
It then proceeded to a lengthy discussion of the
issue raised in the Petition – the separation of
church and state – even tracing, to some extent, the
historical background of the principle. Through its
discourse, the court quipped at some point that the
"endorsement of specific candidates in an election
to any public office is a clear violation of the
separation clause."
The trial court’s essay did not contain a statement
of facts and a dispositive portion, however. Due to
this aberration, Velarde and Soriano filed separate
Motions for Reconsideration before the trial court
owing to these facts.
The lower court denied these Motions. Hence, this
petition for review.
Requisites for a class suit to prosper:
1. The subject matter of the controversy must be of common or general interest to many persons;
2. The persons are so numerous that it is impracticable to join all as parties;
3. The parties actually before the court are sufficiently numerous and representative as to fully
protect the interests of all concerned; and
4. The representatives sue or defend for the benefit of all. (Berses v. Villanueva, 25 Phil. 473; Sulo
ng Bayan, Inc. v. Araneta, 72 SCRA 347)
Mathay vs. Consolidated Bank and Trust Co., 58 SCRA 559
subjected to some burdens or penalties by reason
of the statute or act complained of.
If the petition were to be valid, it should satisfy:
First, parties suing as taxpayers must specifically
prove that they have sufficient interest in
preventing the illegal expenditure of money raised
by taxation, particularly that of Congress' taxing
power.
Second, there was no showing in the Petition for
Declaratory Relief that SJS as a political party or its
members as registered voters would be adversely
affected by the alleged acts of the respondents
below, such as the deprivation of votes or barring
of suffrage to its constituents.
Finally, the allegedly keen interest of its
"thousands of members who are citizens-
taxpayers-registered voters" is too general and
beyond the contemplation of the standards set by
our jurisprudence. Not only is the presumed
interest impersonal in character; it is likewise too
vague, highly speculative and uncertain to satisfy
the requirement of standing.
In not a few cases, the Court has liberalized
the locus standi requirement when a petition
raises an issue of transcendental significance or
importance to the people (IBP v Zamora). The
Court deemed the constitutional issue raised to be
both transcendental in importance and novel in
nature. Nevertheless, the barren allegations in the
SJS Petition as well as the abbreviated proceedings
in the court would prevent the resolution of the
transcendental issue.
An action does not become a class suit merely because it is designated as such in the pleadings. The complaint must
allege the existence of the necessary facts. The test to determine legal standing in a class suit is not one of
number, but whether or not the interest of said party was representative of the persons in whose behalf the class
suit was instituted
Petitioners Mathay et. al and respondents Olondriz WON Mathay et al have standing to sue under a
et al.1 were all stockholders of Consolidated Mines, class suit. NO. The petitioners only represent
Inc. (CMI). their own interests.

During a stockholders’ meeting, a resolution was
passed that the Consolidated Bank & Trust Co.
(CB) will be organized for authorized capital of
P2M and all stockholders of CMI will be entitled to
subscribe to CB’s capital stock.
Circular letter titled: Pre-Incorporation Agreement
to Subscribe forms were circulated to all
stockholders which provided for the terms and
conditions of the subscription. Failure to comply is
tantamount to waiver of the right.
Mathay et. al subscribed to a substantial amount of
shares, but it was known that the original issued
50,000 shares worth P5M was subscribed and paid
by the 6 respondents, Olondriz et al
Mathay et al alleged that this was a plot for
Olondriz et al to gain control of the corporation for
personal profit or gain in disregard of the rights of
all other stockholders.
When the paid-in capital was raised to P8M as
required by the Monetary Board, additional 30k
shares were issued at P3M. These again were all
subscribed and paid by Olondriz et al to the
exclusion of others.
Mathay et al alleged that they were denied to
subscribe to the shares in proportion to their
equities from CMI. They filed the complaint to
have the subscription be annulled
The case was filed in the CFI of Manila but was
dismissed on (among other grounds) having no
legal standing or capacity to institute the class suit.
The complaint does not qualify as a class suit.
Sec. 12 Rule 3 (old ROC). Class suit - When the
subject matter of the controversy is one of common
or general interest to many persons, and the parties
are so numerous that it is impracticable to bring
them all before the court, one or more may sue or
defend for the benefit of ill. But in such case the
court shall make sure that the parties actually
before it are sufficiently numerous and
representative so that all interests concerned are
fully protected. Any party in interest shall have a
right to intervene in protection of his individual
interest.
Test to determine legal standing: not one of
number, but whether or not the interest of said
party was representative of the persons in whose
behalf the class suit was instituted
Mathay et al did not allege how many of the 1,500
stockholders were similarly situated.
Elements of a class suit:
a. Subject matter of controversy be one of common
or general interest to many persons
b. Persons be so numerous as to make it
impracticable to bring them all
to court.
An action does not become a class suit merely
because it is designated as such in the pleadings.
The complaint must allege the existence of the
necessary facts.
Subject matter of the controversy must be of
common or general interest to numerous persons.
Subject matter pertains to the physical facts in
relation to which the suit is prosecuted.

Jurisprudence states that: Common and general

interest in single specific things and not to distinct
ones. Therefore, for example a recovery of real
 property where separate portions were
individually claimed is not a class suit.

As applied: the portion of stocks offering and the

failure to exercise the right to subscribe were
several interests. Each one had a determinable
interest as to his respective portion only. He
cannot have a right to the stock owned by others.

Assuming the stockholders did suffer wrong from

being denied their right to subscribe, the wrongs
suffered by each are separate from other
stockholders. Those wrongs alone would not
create that common or general interest.

Separate wrongs to separate persons, although

committed by similar means and even pursuant
to a single plan, do not alone create a “common or
general” interest in those who are wronged

Commonality in the 3 types of class suits (true,

hybrid, spurious), persons constituting the class
must be so numerous as to make it impracticable
to bring them all before the court.

Moreover, aspurious class action involves a

common question of law or fact affecting several
rights and a common relief is sought. This is
merely a permissive joinder device, because the
class is being formed solely by the presence of a
common question of law or fact. A joinder cannot
be regarded as a class suit.

Granting that the claims of all of them involved the

same question of law, but this alone, did not
constitute the common interest over the subject
matter indispensable in a class suit.
Ortigas & Co. vs. Ruiz, 148 SCRA 326
Parties in a class suit must have a common or general interest in the subject matter of the controversy.
Respondents are occupants of various portions of It is not a case where one or more may sue for the
the 162-heactare land of Petitioner Ortigas Co. benefit of all or where the representation of class
They filed a petition to issue a preliminary interest affected by the judgment or decree is
injunction against a case brought by Petitioner to indispensable to make each member of the class an
recover the parcels of land actual party.

Petitioner argues, that a class suit is not proper in
this case as such presupposes a common and
general interest by several plaintiffs in a single
specific thing. Consequently, it cannot be
maintained when each of those impleaded as
alleged plaintiffs "has only a special or particular
interest in the specific thing completely different
In the case at bar, a class suit would not lie because
each of the defendants has an interest only in the
particular portion of the land he is actually
occupying, and not in the portions individually
occupied by the other defendants. They do not
have a common or general interest in the subject
matter of the controversy.
from another thing in which the defendants have a
like interest."
Newsweek vs. IAC, 142 SCRA 171
Associations of sugarcane planters (landowners) from Negros Occidental filed a civil case for libel seeking damages
against Newsweek for publishing an allegedly defamatory article. The case was intended as a class suit. However,
the Supreme Court ordered the case to be dismissed since it was not a proper class suit because the petitioners do
not represent the same interest.
On March 5, 1981, private respondents
(associations of sugarcane planters in Negros
Occidental claiming to have 8,500 members and
several individual sugar planters) initially filed
a civil case in their own behalf and/or as a class
suit in behalf of all sugarcane planters in the
province of Negros Occidental, against now
petitioner Newsweek (and its reporters Fred
Bruning and Barry Came). The complaint
alleged that Newsweek committed libel against
them by the publication of the article "An Island
of Fear" in its February 23, 1981 issue. The article
allegedly portrayed them to have exploited the
impoverished and underpaid sugarcane
workers and even brutalized and killed some of
these workers with impunity. The complaint
alleged that the article showed a deliberate and
malicious use of falsehood, slanted presentation
and/or misrepresentation of facts intended to
put them in such a bad light. Newsweek filed a
motion to dismiss but the trial court and the IAC
denied it. Thus the present petition.
PETITIONER’S ARGUMENT: Petitioner
argues that private respondents' complaint
failed to state a cause of action because the
complaint made no allegation that anything
contained in the article complained of regarding
sugarcane planters referred specifically to any
one of the private respondents; that libel can be
committed only against individual reputation;
and that in cases where libel is claimed to have
been directed at a group, there is actionable
defamation only if the libel can be said to reach
beyond the mere collectivity to do damage to a
specific, individual group member's reputation
WON the complaint filed for libel may prosper
as a class suit. –NO.
As stated by the Court in Uy Tioco vs. Yang Shu
Wen: “Defamatory remarks directed at a class or
group of persons in general language only, are
not actionable by individuals composing the
class or group unless the statements are
sweeping; and it is very probable that even then
no action would lie where the body is composed
of so large a number of persons that common
sense would tell those to whom the publication
was made that there was room for persons
connected with the body to pursue an upright
and law abiding course and that it would be
unreasonable and absurd to condemn all
because of the actions of a part." Thus, where the
defamation is alleged to have been directed at a
group or class, it is essential that the statement
must be so sweeping or all- embracing as to
apply to every individual in that group or class,
or sufficiently specific so that each individual in
the class or group can prove that the defamatory
statement specifically pointed to him, so that he
can bring the action separately, if, need be.
The case at bar is NOT a class suit. We have here
a case where each of the plaintiffs has a separate
and distinct reputation in the community. They
do not have a common or general interest in the
subject matter of the controversy.

RESPONDENT’S ARGUMENTS: (they assert

that the case they filed is a class suit)
Sulo ng Bayan vs. Araneta, 72 SCRA 347
One of the requisites of a class suit is that the representatives sue or defend for the benefit of all.
On April 26, 1966, plaintiff-appellant Sulo ng Whether or not the plaintiff corporation can
Bayan Inc., filed an action de revindicacion with represent the stockholders in the proceeding for
the Court of First Instance of Bulacan, fifth judicial the properties involved. – NO.
district, Valenzuela, Bulacan, against defendant-
appellees to recover the ownership and possession
of large tract of land in San Jose del Monte,
Bulacan, containing an area of 27,982,250 square
meters, more or less, registered under the Torrens
system in the name of defendants-appellees’
predecessors-in-interest.
The complaint as amended on June 13, 1966,
specifically alleged that plaintiff is a corporation
organized and existing under the laws of the
Philippines, with its principal office and place of
business at San Jose del Monter, Bulacan; that its
membership is composed of natural persons
resident at San Jose del Monte, Bulacan; that the
members of the plaintiff corporation through
themselves and their predecessor-in-interest, had
pioneered in the clearing of the aforementioned
tract of land, activated the same since the Spanish
regime and continuously possessed the said
property openly and public under concept of
ownership adverse against the whole world; that
the defendant-appellee Gregorio Araneta Inc.
sometime in the year 1958, through force and
intimidation ejected the members of the plaintiff
corporation from their possession of the
aforementioned vast tract of land; that upon
investigation conducted by the members and
officers of plaintiff corporation, they found out for
the first time in the year 1961 that the land in
question had been either fraudulently or
erroneously included by direct or constructive
fraud in original certificate of title no. 466 of the
land of records of the province of Bulacan issued
on May 11, 1916 which title is fictitious non-
existent and devoid of legal efficacy due to the fact
that no original survey nor plan whatsoever
appears to have been submitted as basis thereof
and that the Court of First Instance of Bulacan
which issued the decree of registration did not
acquire jurisdiction over the land registration case
because no such notice proceeding was given to
the members of the plaintiff corporation who were
then in actual possession of said properties; that as
consequence of the nullity of the original title, all
subsequent titles derived therefrom such as TCT
no. 7573 in the name of Gregorio Araneta Inc. TCT
No. 4988 issued in the name of the National
Waterworks & Sewerage System TCT No. 4986
issued in the name of Hacienda Caretas Inc. and
It is a doctrine well established and obtains both at
law and equity that a corporation is a distinct legal
entity to be considered as separate and apart from
the individual stockholders and members who
compose it, and is not affected by the personal
rights, obligations and transactions of its
stockholders or members. The property of the
corporation is its property and not that of the
stockholders as owners although they have
equities in it. Properties registered in the name of
the corporation are owned by it as an entity
separate and distinct from its members.
Conversely, a corporation ordinarily has no
interest in the individual property of its
stockholders unless transferred to the corporation,
even in the case of a one-man corporation. The
mere fact that one is president of a corporation
does not render the property which he owns or
possesses the property of the corporation, since the
president as individual, and the corporation are
separate similarities. Sincerely, stockholders in a
corporation engaged in buying and dealing in real
estate whose certificates of stock entitled the holder
thereof, to an allotment in the distribution of the
land of the corporation upon surrender of their
stock certificates were considered not to have such
legal or equitable title or interest in the land, as
would support a suit for title, especially against
parties other than corporation.
It must be noted, however, that the juridical
personality of the corporation,as separate and
distinct from the persons composing it, is but a
legal fiction introduced for the purpose of
convenience and to subserve the ends of justice.
This separate personality of the corporation may
be disregarded, or the veil of corporate fiction
pierced, in cases where it is used as a cloak for
fraud or illegality, or to work an injustice, or where
necessary to achieve equity.
Whether the complaint filed by the corporation
in behalf of its members may be treated as a class
suit. – NO.
In order that a class suit may prosper, the following
requisites must be present: (1) that the subject
matter of thecontroversy is one of common or
general interest to many persons; and (2) that the
parties are so numerous that it isimpracticable to
another transfer certificate of title in the name of
Paradise Farms Inc. are therefore void.
Cruz vs. Cruz, G.R. No. 173292, September 1, 2010
Aguas vs. Llamas, 5 SCRA 959
Board of Liquidators vs. Kalaw, 20 SCRA 987
A corporation which has undergone dissolution nevertheless retains corporate existence for purposes of defending
or initiating suits.
The general manager and board chairman of W/N the Board of Liquidators has lost its legal
NACOCO (National Coconut Corporation) was personality to continue with the suit. (No)
Maximo Kalaw. The rest of the defendants were
either members of the Board or a director.
After the passage of RA 5 (which was NACOCO’s
charter), NACOCO embarked on copra trading
activities. Pursuant to this, 9 contracts which are
the subject of the case were entered into by Kalaw.
NACOCO was unable to fulfill these contracts
because four devastating typhoons visited the
Philippines which led to the damage of coconut
trees around the country, the decrease of copra
production, the spiraling of prices, and destruction
of warehouses.
When it became clear that the contracts would be
unprofitable. Kalaw submitted them to the board
of approval. Obviously, NACOCO was not able to
fully comply with the contract, so one of their
buyers filed claims amounting to P1,343,274.52.
NACOCO seeks to recover the above sum from
Maximo Kalaw as general director and the
directors. It charges Kalaw with negligence under
the Civil Code, and defendant board members
with bad faith and/or breach of trust for having
bring them all before the court. Here, there is only
one party plaintiff, and the corporation does not
evenhave an interest in the subject matter of the
controversy, and cannot, therefore, represent its
members or stockholderswho claim to own in their
individual capacities ownership of the said
property. Moreover, a class suit does not lie in
actionsfor the recovery of property where several
persons claim partnership of their respective
portions of the property, as eachone could alleged
and prove his respective right in a different way for
each portion of the land, so that they cannot all
beheld to have identical title through
acquisition/prescription.
- There are three methods by which a
corporation may wind up its affairs: (1)
Section 3, Rule 104 of the ROC, whereby,
upon voluntary dissolution of a
corporation, the court may direct “such
disposition of its assets as justice requires,
and may appoint a receiver to collect such
assets and pay the debts of the
corporation,” (2) under Section 77 of the
Corporation Law, whereby a corporation
whose corporate existence is terminated,
“shall nevertheless be continued as a body
corporate for three years for the purpose of
prosecuting and defending suits by or
against it,” and (3) under Section 78 of the
Corporation Law, by virtue of which the
corporation, within the 3-year period, “is
authorized and empowered to convey all
of its property to trustees for the benefit of
members, stockholders, creditors, and
others interested.”
- Defendants: Their case comes within the
coverage of the second method. The suit
was commenced in February 1949, that EO
approved the contracts. The lower court dismissed 372 dated November 1950 abolished
the complaint. Thus, this petition. NACOCO, and that, since the three-year
period has elapsed, the BOL can no longer
continue with the case at hand.
- SC: This is wrong. The proviso in Section
1 of EO 372, whereby the corporate
existence of NACOCO was continued for
a period of three years from the effectivity
of the order for "the purpose of
prosecuting and defending suits by or
against it and of enabling the Board of
Liquidators gradually to settle and close
its affairs, to dispose of and convey its
property in the manner hereinafter
provided", is to be read not as an isolated
provision but in conjunction with the
whole. No time limit has been tacked to
the existnce of the BOL and its function
of closing the affairs of various GOCCs,
including NACOCO.
- Further, by EO 372, the government
abolished NACOCO, and placed its assets
in the hands of the BOL. Thus, the BOL
became the trustee on behalf of the
government. The legal interest became
vested in the BOL as trustee, while the
beneficial interest remained with the
government as the sole stockholder. At no
time had the government withdrawn the
property or the authority to continue the
present suit from the BOL.
 The complete loss of the corporate existence
after the expiration of the three-year period for
the settlement of its affairs is precisely what
impelled the President to create a Board of
Liquidators which will continue the
management of such matters as may then be
pending.

W/N Kalaw should be held liable. (No)

- The business of copra-trading means that
forward sales are a necessity. Copra could
not stay long in the hands of the seller; else,
it would lose weight and its value will
decrease.
- Long before the disputed contracts came
into being, Kalaw contracted by himself
for forward sales of copra. These previous
contracts were signed by Kalaw without
prior authority from the board. Said
contracts were known by the board
members, but nothing was said by them.

Spouses Algura vs. City of Naga, 506 SCRA 81
Sps. Algura filed a Complaint for damages against
the Naga City government and its officers. They
alleged that the defendants had caused the illegal
demolition of their residence. o Accompanying the
Complaint was petitioners’ ex parte Motion to
institute action as indigent litigants. To this Motion
was appended Antonio Algura’s pay slip showing
a gross monthly income of P 10,474 and a net pay
of P 3,616.99 for the month of July 1999. Also
attached was a certification by the Office of the City
Assessor of Naga City, stating that petitioners had
no property declared in their names. Finding that
petitioners motion to litigate as indigent litigants
was meritorious, Naga City RTC, granted
petitioners plea for exemption from filing fees. The
city government filed a Motion to Disqualify the
spouses for nonpayment of filing fees.
Respondents had asserted that in addition to the
net income of Antonio, Lorencita had a ministore
and a computer shop. Petitioners were not
indigent litigants, as they also derived additional
income from several boarders who paid them
rentals.
Naga City RTC disqualified petitioners from being
recognized as indigent litigants. They had
allegedly failed to substantiate their claim for
exemption from payment of legal fees and from
compliance with the 3rd par of Sec 18 of Rule 141
of the Rules, directing them to pay the requisite
filing fees. o Petitioners filed a Motion for
Reconsideration. The trial court gave them the
opportunity to comply with Sec.18 of Rule 141,
which had laid down the requisites for qualifying
as an indigent litigant. Petitioners subsequently
submitted their Compliance, to which was
attached the Affidavits of Pet. Lorencita Algura
and one Erlinda Bangate.
Lorencita claimed that the demolition of their small
dwelling deprived them of a monthly income
amounting to P 7,000, forcing them, including their
Obbiously, the NACOCO board met the
difficulties attended to forward sales by
leading the adoption of means to the
sound discretion of Maximo M. Kalaw.
There were other instances when the
Board knew what was happening, but the
Board did not do anything about it.
Whether a trial court has to apply both Rule 141,
Sec. 16 and Rule 3, Sec. 21 on such applications or
should the court apply only Rule 141, Sec. 16 and
discard Rule 3, Sec. 21 as having been superseded
by Rule 141, Section 16 on Legal Fees. – YES. The
trial court should apply both provisions.
Whether the lower court erred in disqualifying
Sps. Algura as indigent litigants - YES
In the instant case, the Affidavits and Certifications
submitted by sps. Algura showed that they did not
own real property; hence, the property
requirement was met. The combined gross
monthly incomes of Antonio and Lorencita -- in the
amounts of P 10,474 and P 3,000 respectively --
were above the P 1,500 monthly income threshold
prescribed by then Rule 141, Sec. 16, thus the
income requirement was not satisfied.
RTC was therefore correct in disqualifying
petitioners Alguras as indigent litigants although
the court should have applied Rule 141, Sec. 16
which was in effect at the time of the filing of the
application on Sept. 1, 1999. Even if Rule 141, Sec.
18 (which superseded Rule 141, Sec. 16 on Mar. 1,
2000) were applied, still the application could not
have been granted as the combined PhP 13,474
income of petitioners was beyond the PhP 3,000
monthly income threshold. However petitioners
also correctly cited, in their MR, Rule 3, Sec. 21
which authorizes parties to litigate their action as
indigents if the court is satisfied that the party is
one who has no money or property sufficient and
available for food, shelter and basic necessities for
himself and his family. RTC did not give credence
to this argument of petitioners and simply applied
Rule 141 but ignored Rule 3, Sec. 21 on Indigent
Party.
6 children, to rely mainly on her husband’s P 3,500
monthly salary as a policeman. o She said that the
family’s basic necessities could not be covered
sufficiently by this salary, the meager income from
her small sari-sari store, and the rentals from some
boarders. o Erlinda Bangate, their neighbor,
corroborated Lorencita’s statements. Petitioners’
MR was denied by the Naga City RTC. The lower
court held that the gross income or total earnings
of the Alguras amounted to P 10,474, which was
over and above the amount set under Rule 141, Sec.
18. Said rule provides that the gross income of the
litigant should not exceed PhP 3,000 a month and
shall not own real estate with an assessed value of
PhP 50,000.
The Court rules that Rule 3, Sec. 21 and Rule 141,
Sec. 16 (later amended as Rule 141, Sec. 18 on Mar
1, 2000 and subsequently amended by Rule 141,
Sec. 9 on Aug. 16, 2003, which is now the present
rule) are still valid and enforceable rules on
indigent litigants. Rule 141, Sec. 19 provides
specific standards while Rule 3, Sec. 21 does not
clearly draw the limits of the entitlement to the
exemption. In light of the foregoing the rules can
be harmonized as follows:
 When an application to litigate as an
indigent litigant is filed, the court shall
scrutinize the affidavits and supporting
documents submitted by the applicant to
determine if the applicant complies with
the income and property standards
prescribed in the present Sec. 19 of Rule
141 that is, the applicants gross income
and that of the applicant’s immediate
family do not exceed an amount double
the monthly minimum wage of an
employee; and the applicant does not own
real property with a FMV of more than P
300,000.
 If the trial court finds that the applicant
meets the income and property
requirements, the authority to litigate as
indigent litigant is automatically granted
and the grant is a matter of right.
 However, if the trial court finds that one or
both requirements have not been met, then
it would set a hearing to enable the
applicant to prove that the applicant has
no money or property sufficient and
available for food, shelter and basic
necessities for himself and his family.
• In that hearing, the adverse party may
adduce countervailing evidence to disprove
the evidence presented by the applicant; after
which the trial court will rule on the
application depending on the evidence
adduced.
• In addition, Sec. 21 of Rule 3 also provides
that the adverse party may later still contest
the grant of such authority at any time before
judgment is rendered by the trial court,
possibly based on newly discovered evidence
not obtained at the time the application was
heard.
 • If the court determines after hearing, that the
party declared as an indigent is in fact a person
with sufficient income or property, the proper
docket and other lawful fees shall be assessed
and collected by the clerk of court.

Recapitulating the rules on indigent litigants,

therefore, if the applicant for exemption meets the
salary and property requirements under Sec. 19 of
Rule 141, then the grant of the application is
mandatory. On the other hand, when the
application does not satisfy one or both
requirements, then the application should not be
denied outright; instead, the court should apply
the indigency test under Sec. 21 of Rule 3 and use
its sound discretion in determining the merits of
the prayer for exemption. As the income
requirement was not satisfied in the case at bar, the
trial court should have set a hearing to give the
Alguras the opportunity to prove that they had “no
money or property sufficient and available for
food, shelter and basic necessities for himself and
his family.” Because of the failure of the RTC to set
a hearing, its Orders disqualifying them from were
set aside.
White vs. City of Manila, 576 SCRA 416, January 20, 2009
In overbreadth analysis, challengers to government action are allowed to raise the rights of third parties. This
doctrine applies when a statue restrains constitutionally guaranteed rights.
Mayor Alfredo Lim passed an Ordinance which WON petitioners have standing to plead for
penalized hotels, motels, lodging houses, pension protection of their patrons’ equal protection
houses and similar establishments that offer short rights. – YES.
time admission (stay for less than 12-hours) and
“wash-up” rates (stay for only 3 hours). Any Petitioners were arguing that their business is
violation would result to either P5, 000 or being unlawfully interfered by the Ordinance and
imprisonment for less than 1 year or both. that it infringed on their clients’ right to equal
protection.
Malate Tourist and Development Corporation
(MTDC; although they withdrew from the case) Recognized exceptions to rule on standing are the
filed a complaint in order to declare the Ordinance third party standing and overbreadth doctrine:.
invalid and unconstitutional. They alleged that PD
259 authorized to charge customers on a short-time THIRD PARTY STANDING - In Powers v. Ohio,
basis and to charge them for wash-up rates. the US SC outlined the criteria to invoke third
party standing:
White Light Corporation (WLC), Titanium - Petitioner must have suffered an injury-in-
Corporation (TC) and Sta. Mesa Tourist and fact, giving him a sufficient concrete
Development Corporation (STDC) joined MTDC’s interest in the outcome of the issue at
petition because the Ordinance affected their hand.
business interests as they operate several drive-in - Petitioner must have a close relation to the
hotels and motels in Manila. third party.
The petitioners agreed to submit the case for
judgment since it was a based on a purely legal
question. RTC declared the Ordinance null and
void because it was against one’s liberty that
Constitution guaranteed to protect.
The City filed a petition for review on certiorari
with SC, which the latter treated as a petition for
certiorari and referred it to the CA. The CA
reversed RTC’s decision and found it to be
constitutional.
Hence, the petition was brought to the SC where
the standing of petitioners was questioned.
Province of North Cotabato vs. GRP Peace Panel on Ancestral Domain, October 14, 2008
Recognized exceptions to rule on standing: Taxpayer’s suit, Suit as Member of Congress
This is a consolidation of a number of cases WON the various parties in this case have
regarding the issues, mostly in relation to its standing.
constitutionality, surrounding the Memorandum
of Agreement on the Ancestral Domain (MOA-
AD) between the Government of the Philippines
(GPR) and the Moro Islamic Liberation Front
(MILF) and the issue regarding the extent of the
powers of the President in pursuing the peace
process. The following are the cases that have been
consolidated:
 G.R. 183591 – (23 July 2008) the Province of
North Cotabato and Vice Governor
Emmanuel Piñol (Mandamus and
Prohibition with Prayer for the Issuance of
Writ of Preliminary Injunction and TRO)
sought to compel respondents to disclose
the MOA-AD and attachments, prohibit
the signing, hold a public consultation and
declare the MOA-AD
UNCONSTITUTIONAL
 G.R. 183752 – the City of
Zamboanga (Mandamus and Prohibition
and similar injunctive reliefs) prayed that
Zamboanga City be excluded from the
Bangsamoro Homeland and/or
Bangasmoro Judicial Entity (BJE) and
that the MOA-AD be declared null and
void
 G.R. 183893 – City of Iligan (Injunction and
Declaratory Relief) sought to enjoin
respondents from signing the MOA-AD
and if it has been signed, from
implementing it. Additionally impleaded
ES Eduardo Ermita as respondent.
- There is a hindrance between the third
party and his ability to protect his
interests.
OVERBREADTH DOCTRINE - In overbreadth
analysis, challengers to government action are
allowed to raise the rights of third parties. This
doctrine applies when a statue restrains
constitutionally guaranteed rights.
The petitioners here are alleging that the
Ordinance intrudes on their right to liberty of their
clients, therefore the overbreadth doctrine applies.
 The Province of North Cotabato, Province of
Zamboanga del Norte, City of Iligan, City of
Zamboanga and petitioners-in-intervention
Province of Sultan Kudarat, City of Isabela
and Municipality of Linamon have locus
standi in view of the direct and substantial
injury that they as LGUs would suffer as
their territories are to be included in the
intended domain of the BJE.
 Petitioners allege that they did not vote for
their inclusion
 Maceda, Binay, Pimentel III would have no
standing for their failure to specify that they
would have rights that will be denied or that
there is a wastage of public funds BUT court
grants them standing due to their invocation
of the transcendental importance of the
issue
 Intervenors Drilon and Tamayo can be
given standing in their claim as tax payers
and that government funds will be used to
conduct an illegal and unconstitutional
plebiscite; transcendental importance
argument also gives them standing
 Intervenor Mar Roxas has standing as his
premise is that he is a member of the Senate
and a citizen (public’s right to be informed
on the MOA-AD) and has genuine legal
interest in the matter in litigation
 Intervenors Lopez, Ridao, Gomez, and
Buxani failed to allege any proper legal
interest in the present petitions
 Muslim Multi-Sectoral Movement for Peace
and Development and Muslim Legal
  G.R. 183951 - the Province of Zamboanga Assistance Foundation may be prejudiced
del Norte et al (petition for Certiorari, and therefore they have standing
Mandamus and Prohibition), prayed to
declare null and void the MOA-AD and
without operative effect and those
respondents enjoined from executing the
MOA-AD
 G.R. 183962 – Maceda, Binay, Pimentel III
filed a petition for Prohibition, praying for
a judgment prohibiting and permanently
enjoining respondents from formally
signing and executing the MOA-AD as
well as to nullify the MOA-AD for being
unconstitutional and illegal. Additionally
impleaded as responded the MILF Peace
Negotiating Panel (represented by
Chairman Iqbal.
 Various parties moved to intervene and
were granted to file their
petitions/comments in-intervention.

On August 5, 2008, the Government of the

Republic of the Philippines and the Moro Islamic
Liberation Front (MILF) were scheduled to sign a
Memorandum of Agreement of the Ancestral
Domain Aspect of the GRP - MILF Tripoli
Agreement on Peace of 2001 in Kuala Lumpur,
Malaysia.

Invoking the right to information on matters of

public concern, the petitioners seek to compel
respondents to disclose and furnish them the
complete and official copies of the MA-AD and to
prohibit the slated signing of the MOA-AD and the
holding of public consultation thereon. They also
pray that the MOA-AD be declared
unconstitutional. The Court issued a TRO
enjoining the GRP from signing the same
Cardenas vs. Heirs of the Late Spouses Aguilar, G.R. No. 191079, March 2, 2016
The purpose behind the rule on substitution is the protection of the right of every party to due process. It is
to ensure that the deceased party would continue to be properly represented in the suit through the duly appointed
legal representative of his estate. Non-compliance with the rule on substitution would render the proceedings and
the judgment of the trial court infirm because the court acquires no jurisdiction over the persons of the legal
representatives or of the heirs on whom the trial and the judgment would be binding.

Similarly in this case, the RTC had priorly acquired jurisdiction over the person of de Comer after she was served
with summons as a party-defendant to the case and she continuously appeared and participated therein up to this
point. Such jurisdiction previously acquired achieved the purpose of a formal substitution.

A formal substitution of the heirs in place of the deceased is no longer necessary if the heirs continued
to appear and participated in the proceedings of the case.
On 8 November 2000, Elinaida L. Alcantara
(Alcantara) obtained a loan from the Spouses
Maximo and Simplicia Aguilar (Spouses Aguilar).
As a security for the said obligation, Alcantara
executed an agreement denominated as Venta con
Pacto de Retro(Sale With Right to Repurchase) in
favor of the Spouses Domingo over a parcel of land
under her name (subject property). It was agreed
by the parties that the term of the loan shall be one
year from the date of the execution of the contract
on. After Alcantara failed to repurchase the subject
property within the stipulated period, she sought
for the extension of the period to exercise her right
to repurchase which was granted by Melba A.
Clavo de Comer, daughter of the Spouses
Domingo.
Joel A. Cardenas (Cardenas), son of Alcantara,
sought to exercise for himself, and on behalf of his
mother, the redemption of the subject property by
offering to pay the entire amount of the loan
including the interest thereon, but it was refused
by the Spouses Aguilar.
This prompted Alcantara to initiate Civil Case No.
LP-02-0300 for the Reformation of Instrument and
Specific Performance against the Spouses Aguilar,
their daughter, Melba A. Clavo de Comer and her
husband, Dan Clavo de Comer (Spouses de
Comer) and Antonio Malinao, in his capacity as
Register of Deeds of Las Piñas City. In her
Complaint docketed as Civil Case No. LP-02-0300,
plaintiff sought that the instrument denominated
as Venta con Pacto de Retro be declared as equitable
mortgage and to direct defendants Spouses
Aguilar and Spouses de Comer to accept her offer
to pay the loan and to release the mortgage
constituted on the subject property.
Amended Complaint (Important)
After Alcantara passed away, she was substituted
by her heir, Cardenas, who filed an Amended
Complaint.
Before the filing of the Amended Complaint, the
counsel for the Spouses Aguilar also manifested
that Maximo V. Aguilar likewise passed away by
filing a Notice of Death with the trial court and
serving a copy thereof on the opposing party. It
was stated in the said notice that Maximo V.
WHETHER OR NOT A MOTION FOR
EXECUTION CAN BE FILED BY A COUNSEL
WHEN THE JUDGMENT OBLIGEES WERE
ALREADY DEAD AND NEITHER WAS THERE
AN EXECUTOR OR ADMINISTRATOR
APPOINTED BY THE COURT NOR AN HEIR
SUBSTITUTED AS A PARTY TO THE CASE TO
AUTHORIZE THE COUNSEL TO MOVE FOR
THE EXECUTION OF THE JUDGMENT. – YES.
Section 16. Death of party; duty of counsel. -
Whenever a party to a pending action dies, and the
claim is not thereby extinguished, it shall be the
duty of his counsel to inform the court within
thirty (30) days after such death of the fact thereof,
and to give the name and address of his legal
representative or representatives. Failure of
counsel to comply with his duty shall be a ground
for disciplinary action.
The heirs of the deceased may be allowed to be
substituted for the deceased, without requiring the
appointment of an executor or administrator and
the court may appoint a guardian ad litem for the
minor heirs.
The court shall forthwith order said legal
representative or representatives to appear and be
substituted within a period of thirty (30) days from
notice.
If no legal representative is named by the counsel
for the deceased party, or if the one so named shall
fail to appear within the specified period, the court
may order the opposing party, within a specified
time, to procure the appointment of an executor or
administrator for the estate of the deceased and the
latter shall immediately appear for and on behalf
of the deceased. The court charges in procuring
such appointment, if defrayed by the opposing
party, may be recovered as costs.
The purpose behind the rule on substitution is the
protection of the right of every party to due
process. It is to ensure that the deceased party
would continue to be properly represented in the
suit through the duly appointed legal
representative of his estate. Non-compliance with
the rule on substitution would render the
proceedings and the judgment of the trial court
infirm because the court acquires no jurisdiction
Aguilar is survived by his spouse, Simplicia P.
Aguilar and his daughter, Melba A. Clavo de
Comer and that both were already impleaded as
original defendants in the complaint.
Subsequently defendants filed an Answer wherein
they insisted that their transaction was not an
equitable mortgage as claimed by the plaintiffs
but a sale with a right to repurchase as clearly
stipulated in the contract.
Considering that Alcantara failed to exercise her
right to repurchase the subject property within the
period agreed upon by parties, defendants asked
that the title thereon be consolidated in their
names. In the alternative, defendants sought that
the plaintiffs be directed to repurchase the
property in the amount of P3,000,000.00 with an
interest of 10% of the purchase price.
RTC: Decided in favor of the plaintiffs. Defendants
filed a Motion for Execution of the RTC decision.
This was opposed by the plaintiff on the ground
that the original defendants (the Spouses
Aguilar) in Civil Case No. LP-02-0300 were
already dead and no proper substitution of the
parties was effected by the counsel as mandated
by Section 16, Rule 3 of the Revised Rules of Civil
Procedure.
over the persons of the legal representatives or of
the heirs on whom the trial and the judgment
would be binding.
However, in the case at bar, no right to procedural
due process was violated when the counsel for the
respondents failed to notify the court of the fact of
death of Simplicia P. Aguilar and even if no formal
substitution of parties was effected after the such
death. As can be gleaned above, the rationale
behind the rule on substitution is to apprise the
heir or the substitute that he is being brought to the
jurisdiction of the court in lieu of the deceased
party by operation of law. The said purpose was
not defeated even if no proper substitution of party
was made because Melba A. Clavo de Comer, the
heir of the deceased Simplicia P. Aguilar, was
already impleaded by petitioner as a party-
defendant to Civil Case No. LP-02-0300 when the
latter filed his Amended Complaint. For sure,
petitioner is very much aware that despite the
passing of the Spouses Aguilar, the case would still
continue because de Comer, on her own behalf and
as the legal representative of her deceased parents,
possessed the authority to pursue the case to its
end.
WHETHER OR NOT THE COURT CAN GRANT
A MOTION FOR EXECUTION FILED BY A
COUNSEL WHEN THE JUDGMENT OBLIGEES
WERE ALREADY DEAD AND NEITHER WAS
THERE AN EXECUTOR OR ADMINISTRATOR
APPOINTED BY THE COURT NOR AN HEIR
SUBSTITUTED AS A PARTY TO THE CASE.–
YES.
A formal substitution of the heirs in place of the
deceased is no longer necessary if the heirs
continued to appear and participated in the
proceedings of the case.