G.R. No.

141524 DOMINGO NEYPES, LUZ FAUSTINO, ROGELIO FAUSTINO, LOLITO VICTORIANO, JACOB OBANIA AND DOMINGO CABACUNGAN vs. COURT OF APPEALS DECISION CORONA, J.: Petitioners Domingo Neypes, Luz Faustino, Rogelio Faustino, Lolito Victoriano, Jacob Obania and Domingo Cabacungan filed an action for annulment of judgment and titles of land and/or reconveyance and/or reversion with preliminary injunction before the Regional Trial Court, Branch 43, of Roxas, Oriental Mindoro, against the Bureau of Forest Development, Bureau of Lands, Land Bank of the Philippines and the heirs of Bernardo del Mundo, namely, Fe, Corazon, Josefa, Salvador and Carmen. In the course of the proceedings, the parties (both petitioners and respondents) filed various motions with the trial court. Among these were: (1) the motion filed by petitioners to declare the respondent heirs, the Bureau of Lands and the Bureau of Forest Development in default and (2) the motions to dismiss filed by the respondent heirs and the Land Bank of the Philippines, respectively. In an order dated May 16, 1997, the trial court, presided by public respondent Judge Antonio N. Rosales, resolved the foregoing motions as follows: (1) the petitioners motion to declare respondents Bureau of Lands and Bureau of Forest Development in default was granted for their failure to file an answer, but denied as against the respondent heirs of del Mundo because the substituted service of summons on them was improper; (2) the Land Banks motion to dismiss for lack of cause of action was denied because there were hypothetical admissions and matters that could be determined only after trial, and ( 3) the motion to dismiss filed by respondent heirs of del Mundo, based on prescription, was also denied because there were factual matters that could be determined only after trial. [1] The respondent heirs filed a motion for reconsideration of the order denying their motion to dismiss on the ground that the trial court could very well resolve the issue of prescription from the bare allegations of the complaint itself without waiting for the trial proper. In an order[2] dated February 12, 1998, the trial court dismissed petitioners complaint on the ground that the action had already prescribed . Petitioners allegedly received a copy of the order of dismissal on March 3, 1998 and, on the 15 th day thereafter or on March 18, 1998, filed a motion for reconsideration. On July 1, 1998, the trial court issued another order dismissing the motion for reconsideration [3] which petitioners received on July 22, 1998. Five days later, on July 27, 1998, petitioners filed a notice of appeal[4] and paid the appeal fees on August 3, 1998. On August 4, 1998, the court a quo denied the notice of appeal, holding that it was filed eight days late.[5] This was received by petitioners on July 31, 1998. Petitioners filed a motion for reconsideration but this too was denied in an order dated September 3, 1998. [6] Via a petition for certiorari and mandamus under Rule 65 of the 1997 Rules of Civil Procedure, petitioners assailed the dismissal of the notice of appeal before the Court of Appeals. In the appellate court, petitioners claimed that they had seasonably filed their notice of appeal. They argued that the 15-day reglementary period to appeal started to run only on July 22, 1998 since this was the day they received the final order of the trial court denying their motion for reconsideration. When they filed their notice of appeal on July 27, 1998, only five days had elapsed and they were well within the reglementary period for appeal.[7] On September 16, 1999, the Court of Appeals (CA) dismissed the petition. It ruled that the 15-day period to appeal should have been reckoned from March 3, 1998 or the day they received the February 12, 1998

order dismissing their complaint. According to the appellate court, the order was the final order appealable under the Rules. It held further:
Perforce the petitioners tardy appeal was correctly dismissed for the (P)erfection of an appeal within the reglementary period and in the manner prescribed by law is jurisdictional and non-compliance with such legal requirement is fatal and effectively renders the judgment final and executory.[8]

Petitioners filed a motion for reconsideration of the aforementioned decision. This was denied by the Court of Appeals on January 6, 2000. In this present petition for review under Rule 45 of the Rules , petitioners ascribe the following errors allegedly committed by the appellate court:

I THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING THE PETITIONERS PETITION FOR CERTIORARI AND MANDAMUS AND IN AFFIRMING THE ORDER OF THE HON. JUDGE ANTONIO N. ROSALES WHICH DISMISSED THE PETITIONERS APPEAL IN CIVIL CASE NO. C-36 OF THE REGIONAL TRIAL COURT, BRANCH 43, ROXAS, ORIENTAL MINDORO, EVEN AFTER THE PETITIONERS HAD PAID THE APPEAL DOCKET FEES. II THE HONORABLE COURT OF APPEALS LIKEWISE ERRED IN RULING AND AFFIRMING THE DECISION OR ORDER OF THE RESPONDENT HON. ANTONIO M. ROSALES THAT PETITIONERS APPEAL WAS FILED OUT OF TIME WHEN PETITIONERS RECEIVED THE LAST OR FINAL ORDER OF THE COURT ON JULY 22, 1998 AND FILED THEIR NOTICE OF APPEAL ON JULY 27, 1998 AND PAID THE APPEAL DOCKET FEE ON AUGUST 3, 1998. III THE HONORABLE COURT OF APPEALS FURTHER ERRED IN RULING THAT THE WORDS FINAL ORDER IN SECTION 3, RULE 41, OF THE 1997 RULES OF CIVIL PROCEDURE WILL REFER TO THE [FIRST] ORDER OF RESPONDENT JUDGE HON. ANTONIO M. MORALES DATED FEBRUARY 12, 1998 INSTEAD OF THE LAST AND FINAL ORDER DATED JULY 1, 1998 COPY OF WHICH WAS RECEIVED BY PETITIONERS THROUGH COUNSEL ON JULY 22, 1998. IV. THE HONORABLE COURT OF APPEALS FINALLY ERRED IN FINDING THAT THE DECISION IN THE CASE OF DENSO, INC. V. IAC, 148 SCRA 280, IS APPLICABLE IN THE INSTANT CASE THEREBY IGNORING THE PECULIAR FACTS AND CIRCUMSTANCES OF THIS CASE AND THE FACT THAT THE SAID DECISION WAS RENDERED PRIOR TO THE ENACTMENT OF THE 1997 RULES OF CIVIL PROCEDURE.[9] The foregoing issues essentially revolve around the period within which petitioners should have filed their notice of appeal. First and foremost, the right to appeal is neither a natural right nor a part of due process. It is merely a statutory privilege and may be exercised only in the manner and in accordance with the provisions of law. Thus, one who seeks to avail of the right to appeal must comply with the requirements of the Rules.

Failure to do so often leads to the loss of the right to appeal. [10] The period to appeal is fixed by both statute and procedural rules. BP 129,[11] as amended, provides: Sec. 39. Appeals. The period for appeal from final orders, resolutions, awards, judgments, or decisions of any court in all these cases shall be fifteen (15) days counted from the notice of the final order, resolution, award, judgment, or decision appealed from . Provided, however, that in habeas corpus cases, the period for appeal shall be (48) forty-eight hours from the notice of judgment appealed from. x x x Rule 41, Section 3 of the 1997 Rules of Civil Procedure states: SEC. 3. Period of ordinary appeal. The appeal shall be taken within fifteen (15) days from the notice of the judgment or final order appealed from. Where a record on appeal is required, the appellant shall file a notice of appeal and a record on appeal within thirty (30) days from the notice of judgment or final order. The period to appeal shall be interrupted by a timely motion for new trial or reconsideration. No motion for extension of time to file a motion for new trial or reconsideration shall be allowed. Based on the foregoing, an appeal should be taken within 15 days from the notice of judgment or final order appealed from. A final judgment or order is one that finally disposes of a case, leaving nothing more for the court to do with respect to it. It is an adjudication on the merits which, considering the evidence presented at the trial, declares categorically what the rights and obligations of the parties are; or it may be an order or judgment that dismisses an action. [12] As already mentioned, petitioners argue that the order of July 1, 1998 denying their motion for reconsideration should be construed as the final order, not the February 12, 1998 order which dismissed their complaint. Since they received their copy of the denial of their motion for reconsideration only on July 22, 1998, the 15-day reglementary period to appeal had not yet lapsed when they filed their notice of appeal on July 27, 1998. What therefore should be deemed as the final order, receipt of which triggers the start of the 15day reglementary period to appeal the February 12, 1998 order dismissing the complaint or the July 1, 1998 order dismissing the MR? In the recent case of Quelnan v. VHF Philippines, Inc. ,[13] the trial court declared petitioner Quelnan nonsuited and accordingly dismissed his complaint. Upon receipt of the order of dismissal, he filed an omnibus motion to set it aside. When the omnibus motion was filed, 12 days of the 15-day period to appeal the order had lapsed. He later on received another order, this time dismissing his omnibus motion. He then filed his notice of appeal. But this was likewise dismissed for having been filed out of time. The court a quo ruled that petitioner should have appealed within 15 days after the dismissal of his complaint since this was the final order that was appealable under the Rules. We reversed the trial court and declared that it was the denial of the motion for reconsideration of an order of dismissal of a complaint which constituted the final order as it was what ended the issues raised there. This pronouncement was reiterated in the more recent case of Apuyan v. Haldeman et al.[14] where we again considered the order denying petitioner Apuyans motion for reconsideration as the final order which finally disposed of the issues involved in the case. Based on the aforementioned cases, we sustain petitioners view that the order dated July 1, 1998 denying their motion for reconsideration was the final order contemplated in the Rules.

We now come to the next question: if July 1, 1998 was the start of the 15-day reglementary period to appeal, did petitioners in fact file their notice of appeal on time? Under Rule 41, Section 3, petitioners had 15 days from notice of judgment or final order to appeal the decision of the trial court. On the 15th day of the original appeal period (March 18, 1998), petitioners did not file a notice of appeal but instead opted to file a motion for reconsideration. According to the trial court, the MR only interrupted the running of the 15-day appeal period .[15] It ruled that petitioners, having filed their MR on the last day of the 15-day reglementary period to appeal, had only one (1) day left to file the notice of appeal upon receipt of the notice of denial of their MR. Petitioners, however, argue that they were entitled under the Rules to a fresh period of 15 days from receipt of the final order or the order dismissing their motion for reconsideration. In Quelnan and Apuyan, both petitioners filed a motion for reconsideration of the decision of the trial court. We ruled there that they only had the remaining time of the 15-day appeal period to file the notice of appeal. We consistently applied this rule in similar cases, [16] premised on the long-settled doctrine that the perfection of an appeal in the manner and within the period permitted by law is not only mandatory but also jurisdictional .[17] The rule is also founded on deep-seated considerations of public policy and sound practice that, at risk of occasional error, the judgments and awards of courts must become final at some definite time fixed by law. [18] Prior to the passage of BP 129, Rule 41, Section 3 of the 1964 Revised Rules of Court read: Sec. 3. How appeal is taken. Appeal maybe taken by serving upon the adverse party and filing with the trial court within thirty (30) days from notice of order or judgment, a notice of appeal, an appeal bond, and a record on appeal. The time during which a motion to set aside the judgment or order or for new trial has been pending shall be deducted, unless such motion fails to satisfy the requirements of Rule 37. But where such motion has been filed during office hours of the last day of the period herein provided, the appeal must be perfected within the day following that in which the party appealing received notice of the denial of said motion.[19] According to the foregoing provision, the appeal period previously consisted of 30 days. BP 129, however, reduced this appeal period to 15 days. In the deliberations of the Committee on Judicial Reorganization[20] that drafted BP 129, the raison d etre behind the amendment was to shorten the period of appeal[21] and enhance the efficiency and dispensation of justice. We have since required strict observance of this reglementary period of appeal. Seldom have we condoned late filing of notices of appeal,[22] and only in very exceptional instances to better serve the ends of justice. In National Waterworks and Sewerage Authority and Authority v. Municipality of Libmanan ,[23] however, we declared that appeal is an essential part of our judicial system and the rules of procedure should not be applied rigidly. This Court has on occasion advised the lower courts to be cautious about not depriving a party of the right to appeal and that every party litigant should be afforded the amplest opportunity for the proper and just disposition of his cause, free from the constraint of technicalities. In de la Rosa v. Court of Appeals ,[24] we stated that, as a rule, periods which require litigants to do certain acts must be followed unless, under exceptional circumstances, a delay in the filing of an appeal may be excused on grounds of substantial justice. There, we condoned the delay incurred by the appealing party due to strong considerations of fairness and justice. In setting aside technical infirmities and thereby giving due course to tardy appeals, we have not been oblivious to or unmindful of the extraordinary situations that merit liberal application of the Rules. In those situations where technicalities were dispensed with, our decisions were not meant to undermine the force and effectivity of the periods set by law. But we hasten to add that in those rare cases where procedural rules were not stringently applied, there always existed a clear need to prevent the commission of a grave injustice. Our judicial system and the courts have always tried to maintain a healthy balance between the

strict enforcement of procedural laws and the guarantee that every litigant be given the full opportunity for the just and proper disposition of his cause.[25] The Supreme Court may promulgate procedural rules in all courts. [26] It has the sole prerogative to amend, repeal or even establish new rules for a more simplified and inexpensive process, and the speedy disposition of cases. In the rules governing appeals to it and to the Court of Appeals, particularly Rules 42,[27] 43[28] and 45,[29] the Court allows extensions of time, based on justifiable and compelling reasons, for parties to file their appeals. These extensions may consist of 15 days or more. To standardize the appeal periods provided in the Rules and to afford litigants fair opportunity to appeal their cases, the Court deems it practical to allow a fresh period of 15 days within which to file the notice of appeal in the Regional Trial Court, counted from receipt of the order dismissing a motion for a new trial or motion for reconsideration. [30] Henceforth, this fresh period rule shall also apply to Rule 40 governing appeals from the Municipal Trial Courts to the Regional Trial Courts; Rule 42 on petitions for review from the Regional Trial Courts to the Court of Appeals; Rule 43 on appeals from quasi-judicial agencies [31] to the Court of Appeals and Rule 45 governing appeals by certiorari to the Supreme Court.[32] The new rule aims to regiment or make the appeal period uniform, to be counted from receipt of the order denying the motion for new trial, motion for reconsideration (whether full or partial) or any final order or resolution. We thus hold that petitioners seasonably filed their notice of appeal within the fresh period of 15 days , counted from July 22, 1998 (the date of receipt of notice denying their motion for reconsideration). This pronouncement is not inconsistent with Rule 41, Section 3 of the Rules which states that the appeal shall be taken within 15 days from notice of judgment or final order appealed from. The use of the disjunctive word or signifies disassociation and independence of one thing from another. It should, as a rule, be construed in the sense in which it ordinarily implies. [33] Hence, the use of or in the above provision supposes that the notice of appeal may be filed within 15 days from the notice of judgment or within 15 days from notice of the final order, which we already determined to refer to the July 1, 1998 order denying the motion for a new trial or reconsideration. Neither does this new rule run counter to the spirit of Section 39 of BP 129 which shortened the appeal period from 30 days to 15 days to hasten the disposition of cases. The original period of appeal (in this case March 3-18, 1998) remains and the requirement for strict compliance still applies. The fresh period of 15 days becomes SIGNIFICANT ONLY when a party opts to file a motion for new trial or motion for reconsideration. In this manner, the trial court which rendered the assailed decision is given another opportunity to review the case and, in the process, minimize and/or rectify any error of judgment. While we aim to resolve cases with dispatch and to have judgments of courts become final at some definite time, we likewise aspire to deliver justice fairly. In this case, the new period of 15 days eradicates the confusion as to when the 15-day appeal period should be counted from receipt of notice of judgment (March 3, 1998) or from receipt of notice of final order appealed from (July 22, 1998). To recapitulate, a party litigant may either file his NOTICE OF APPEAL within 15 days from receipt of the Regional Trial Courts decision or file it within 15 days from receipt of the order (the final order) denying his motion for new trial or motion for reconsideration . Obviously, the new 15-day period may be availed of only if either motion is filed; otherwise, the decision becomes final and executory after the lapse of the original appeal period provided in Rule 41, Section 3. Petitioners here filed their notice of appeal on July 27, 1998 or five days from receipt of the order denying their motion for reconsideration on July 22, 1998. Hence, the notice of appeal was well within the fresh appeal period of 15 days, as already discussed.[34] We deem it unnecessary to discuss the applicability of Denso (Philippines), Inc. v. IAC[35] since the Court of Appeals never even referred to it in its assailed decision.

WHEREFORE, the petition is hereby GRANTED and the assailed decision of the Court of Appeals REVERSED andSET ASIDE. Accordingly, let the records of this case be remanded to the Court of Appeals for further proceedings. No costs. SO ORDERED.

G.R. No. L-61042 April 15, 1987 HECTOR L. ONG, petitioner, vs. MARILYN TATING AND ROBERT TATING, ET AL., respondents.

NARVASA, J.: The issue in this case concerns the jurisdiction of an inferior Court to take cognizance of a motion impugning the sheriff's authority to execute a final judgment in an ejectment case which commands payment of rentals in arrears against personalty claimed as theirs by persons formerly residing in the leased premises together with the evicted defendant-lessee. An action of desahucio was instituted in the City Court of Quezon City by petitioner Ong against his lessee, Evangeline Roces. 1 This in time culminated in a judgment by the Court of First Instance (Branch XVIII) 2disposing of the case as follows: WHEREFORE, premises considered, the judgment of the City Court is set aside and in lieu thereof judgment is rendered ordering defendant Evangeline Roces and all persons claiming under her to vacate plaintiff's premises located at 169-D, Tolentino St., San Francisco del Monte, Quezon City; to pay rentals in arrears in the sum of P10,920.00 as of September 1978 and P260.00 a month from October 1978 until the premises are vacated with interest at 12% per annum; P1,000.00 as attomey's fees and the costs. 3 The decision became final and executory, no appeal having been taken therefrom; and in due course, the records of the case were remanded to the City Court. On Ong's application, the City Court directed execution of the judgment. Accordingly, the sheriff cleared the premises of its occupants, which included Anacleto Tating (Evangeline's stepfather and lawyer), Marilyn Tating (Anacleto's wife), and Robert Tating. 4 The sheriff also levied on certain chattels found in the place: a "Citizen" stereo set; a "Sanyo" television set; a "Frigidaire" refrigerator; and a "Hitachi" electric desk fan. Marilyn and Robert Tating sought to retrieve these appliances from the sheriff, alleging that the articles belonged to them and not to the lessee, Evangeline Roces. 5To this end, Robert filed with the sheriff a "Third Party Claim" dated September 13, 1979 as regards the "Citizen" stereo set; and Marilyn, a similar claim with respect to the other chattels. 6 When these proved unavailing, they filed with the City Court Identical applications dated September 17, 1979, entitled "Urgent Motion for Suspension of Sheriff Sale and for Release of Properties Wrongfully Levied Upon on Execution ," in which they set out their respective titles to the

goods and prayed that the execution sale thereof scheduled on September 19, 1979 be abated and that, after hearing, said goods be released to them as the true and lawful owners thereof. 7 To neutralize the Tatings' moves, and so that the execution sale might proceed as scheduled, Ong posted two (2) surety bonds 8 to indemnify the sheriff for any liability for damages. 9 But by Order dated September 19, 1979 the City Court restrained the sale and set the Tatings' motions for hearing. 10 What Ong did was to present an "Omnibus Opposition, etc. " dated October 2, 1979, 11 contending that the Tatings' motions should have been filed with the Court of First Instance since it was the latter's decision which was being executed; and that, in any event, the Tatings' remedy was "to file an action for damages against the indemnity bonds after the auction sale. " He also theorized that * * Atty. Tating, and the third party claimants having stayed in the premises and having enjoyed the same should be required to pay the back rentals, attorney's fees and sheriff's and legal expenses (and should not) escape by avoiding paying any amount as stated in the judgment. * * 12 Ong later filed a "Motion to Inhibit" dated January 9, 1980, which the City Court denied by Order dated January 23, 1980. The Court also directed Ong's counsel to explain certain apparently contumacious statements in the motion. The Order reads as follows: ORDER Considering the Motion to Inhibit filed by the plaintiff, dated January 9, 1980, and the Manifestation filed by the third party claimants, Marilyn Tating and Robert Tating, dated January 16, 1980, this Court finds the motion without merit and hereby resolves to deny it. Furthermore, Atty. Manuel E. Yuzon, counsel for the plaintiff, is hereby ordered to explain in writing within ten (10) days from notice hereof why he should not be cited for indirect contempt of court for stating in his Motion to Inhibit that if this Court 'proceeds to hear and resolve the third-party claims, it is foregone conclusion that the third-party claimants will surely win and the plaintiff will lose,' thereby casting aspersions on the integrity of this Court and degrading the administration of justice. In the meantime, let the continuation of the hearing of the motion for suspension of sheriff's sale etc. be set for February 11, 1980, at 9:00 o'clock in the morning. SO ORDERED. 13 Ong promptly initiated proceedings to negate this Order. He filed with the Court of First Instance on February 7, 1980 a petition for certiorari and prohibition , with application for preliminary injunction. 14 Acting thereon, the Court (Branch IX) promulgated an Order dated April 2, 1980 directing the maintenance of the status quo and commanding that the City Court refrain "from hearing and deciding the third party claims and the urgent motion for suspension of Sheriff's Sale, etc. until the resolution of the injunction * *. 15 It afterwards rendered a decision, dated December 15, 1981, 16 pertinently reading as follows: The issue in this petition boils down to this should the third-party claims be heard and decided by the lower court. While it is true that the respondents Marilyn and Robert Tating were not parties in the ejectment case because the lease was between the petitioner and Evangeline Roces,

they stayed with her and the decision of the appellate court covered them as it ordered "Evangeline Roces and all persons claiming under her to vacate plaintiff's premises" ... Besides, the procedure followed by said private respondents in vindicating their rights over the four (4) levied appliances is not the one sanctioned by law for they should have filed a separate and independent action making parties the deputy sheriff and the petitioner and making them responsible for the execution (Santos et al., vs. Hon. Mojica, L-19618, Feb. 28, 1964). WHEREUPON, premises considered, the petitioner Hector L. Ong is entitled to relief. The decision of Branch XVIII of the CFI Quezon City which is final and executory, stands. The preliminary injunction issued on April 2, 1980 is hereby ordered permanent. 17 The Tatings appealed to the Court of Appeals by "a petition for review filed * * on March 1, 1982. 18 In its decision, promulgated on June 23, 1982, after due proceedings, 19 the Court of Appeals expressed puzzlement why the matter of the execution and related incidents were passed upon by the lower court, when the only issue was the correctness of the City Judge's refusal to inhibit, himself. 20 It dismissed the petition, and sent the case back to the City Court for further proceedings." Said the Court:
It is a puzzle to Us why the hearing went out of bounds. Instead of determining merely the propriety of the order of denial of the motion to inhibit, the parties and the Court of First Instance * * went into the merits of the propriety of the execution of the decision of the City Court, the auction sale of the appliances claimed by the Tatings, the levy,the third party claim,the indemnity bond, and the motion to suspend the sale and the filling of the sheriffs bond matters which are properly only to be treated in a separate proceeding. From the records,We see that if at all the matter of execution of the decision ** (etc.) were mentioned,it was merely to give a background to the motion to inhibit Judge Laquio, Jr. from proceeding to take further participation in the incident of the execution ** and the incident stemming therefrom. The propriety of the denial of the motion to inhibit was lost in the maze of the irrelevant facts and incidents taken during the hearing of this case in the court below. A thorough review of the decision of the Court of First Instance * * Branch IX, in this certiorari case shows that the Presiding Judge * * erroneously treated the pleadings before it in Civil Case No. 29245. Thus, We are constrained to set the same aside and remand the case to the City Court presided over by Judge Laquio, Jr. for further proceedings. Principally, We rule the denial of the motion for Judge Laquio, Jr. to inhibit himself from the ejectment case No. 28309, Quezon City Court, was well taken. The petition assailing the order of denial which is the main issue in Civil Case No. 29245 is without merit. * * 21

Ong is now before this Court, praying for the reversal of the decision of the Court of Appeals, and the perpetual inhibition of the City Judge "from further hearing and deciding the (Tatings') third-party claims." 22 It will not do to dismiss the petition as the IAC did by declaring that the only issue involved is the propriety of the City Judge's denial of the motion for his inhibition, and pronouncing the denial to be correct. Not only is such a limitation of the issues disputed by Ong, but the resolution of the single point would leave unanswered several other nagging questions. The opportunity to resolve those questions having been presented, the Court will do precisely that, to the end that the controversy may be expeditiously laid to rest, Three theories are advocated by Ong, namely:

1. From the decision of the Court of First Instance (Branch IX) on his petition for certiorari and prohibition, the Tatings' remedy was appeal (by writ of error), not a petition for review, to the Court of Appeals. 2. The City Court lost jurisdiction to hear and determine the Tatings' third-party claims upon the filing by him (Ong) of the bonds prescribed by Section 17, Rule 39, the purpose of which is precisely to hold the sheriff free from liability for damages for proceeding with the execution sale despite said third- party claims. 3. Corollarily, the Tatings' remedy was to file a separate suit to recover against said bonds posted by Ong, whatever damages might be suffered by them by reason of the effectuation of the execution sale. 23 Ong is correct in arguing that the mode of appeal to the Court of Appeals available to the Tatings from the adverse judgment of the CFI in the action of certiorari and prohibition instituted by him , was not by "petition for review" under Section 22 of B.P. Blg., 129 24 but an ordinary appeal (by writ of error) under Rule 41, Rules of Court and Section 39, of B.P. Blg. 129 (also, Section 20 of the Interim Rules) A "PETITION FOR REVIEW" is the correct mode of appeal from a judgment rendered by a CFI (RTC) in the exercise of appellate jurisdiction i.e., when it decides a case appealed to it from the inferior court. In such a case, the appeal is not a matter of right, its acceptance being discretionary on the Court of Appeals, which "may give it due course only when the petition shows prima facie that the lower court has committed an error of fact or law that will warrant a reversal or modification of the decision or judgment sought to be reviewed." On the other hand, when a CFI (RTC) adjudicates a case in the exercise of its original jurisdiction, the correct mode of elevating the judgment to the Court of Appeals is by ORDINARY APPEAL, or appeal by writ of error, involving merely the filing of a notice of appeal except only if the appeal is taken in special proceedings and other cases wherein multiple appeals are allowed under the law, in which event the filing of a record on appeal is additionally required. 25 Of course, when the appeal would involve PURELY QUESTIONS OF LAW or any of the other cases (except criminal cases as stated hereunder) specified in Section 5(2), Article X of the Constitution, 26 it should be taken to the Supreme Court by PETITION FOR REVIEW ON CERTIORARI in accordance with Rules 42 and 45 of the Rules of Court. 27 However, in criminal cases in which the penalty imposed is death or life imprisonment, the appeal to the Supreme Court is by ordinary appeal on both questions of fact and law. In cases where the death penalty is imposed, there is an automatic review by the Supreme Court. (Sec. 3 of the 1985 Rules on Criminal Procedure) The mode by which the Tatings thus brought up to the Court of Appeals the adverse judgment of the CFI i.e., by petition for review was erroneous. This aspect of the case apparently escaped the Appellate Court's attention; it did not treat of it at all. This is however of no moment. The need of finally resolve this case makes this defect inconsequential. In any event, the defect has been waived, no issue concerning it having been raised in the proceedings before the Court of Appeals. 28 Ong's second contention that the posting by him of a bond to indemnify the sheriff for damages for proceeding with an execution sale despite the existence of third-party claims on the property levied on (pursuant to Section 17, Rule 39) caused the Trial Court to lose jurisdiction to deal with the third-party claimants' plea for relief against what they deemed to be an act of trespass by the sheriff is incorrect. Certain it is that the Trial Court has plenary jurisdiction over the proceedings for the enforcement of its judgments. It has undeniable competence to act on motions for execution (whether execution be a matter of right or discretionary upon the Court), issue and quash writs, determine if property is exempt from execution, or fix the value of property claimed by third persons so that a bond equal to such value may be posted by a judgment creditor to indemnify the sheriff against liability for damages, resolve questions involving redemption, examine the judgment debtor and his debtors, and otherwise perform such other acts as may be necessary or incidental to the carrying out of its decisions. It may and should exercise control and supervision over the sheriff and other court officers and employees taking part in the execution proceedings, and correct them in the event that they should err in the discharge of their functions.

Now, it is axiomatic that money judgments are enforceable only against property unquestionably belonging to the judgment debtor. One man's goods shall not be sold for another man's debts, as the saying goes. 29 Therefore, the sheriff acts properly only when he subjects to execution property undeniably belonging to the judgment debtor. But to the extent that he levies on assets of a third person, in which the judgment debtor has no interest, to that extent he acts as a trespasser, and to that extent he is amenable to control and correction by the Court. 30 When the sheriff thus seizes property of a third person in which the judgment debtor holds no right or interest, and so incurs in error, the supervisory power of the Court which has authorized execution may be invoked by the third person. Upon due application by the third person, and after summary hearing, the Court may command that the property be released from the mistaken levy and restored to the rightful owner or possessor. What the Court can do in these instances however is limited to a determination of whether the sheriff has acted rightly or wrongly in the performance of his duties in the execution of the judgment, more specifically, if he has indeed taken hold of property not belonging to the judgment debtor. The Court does not and cannot pass upon the question of title to the property, with any character of finality . It can treat of that matter only in so far as may be necessary to decide if the Sheriff has acted correctly or not. 31 The Court can require the sheriff to restore the property to the claimant's possession if warranted by the evidence . If the claimant's proofs do not however persuade the Court of his title or right of possession thereof, the claim will of course be denied. This remedy is not that of intervention, which is dealt with in Rule 12 of the Rules of Court, and may be availed of only before or during trial, not thereafter, and certainly not when judgment is executory. It is rather simply an invocation of the Court's power of supervision and control over the actuations of its officers and employees to the end that it be assured that these conform to the law. 32 Independently of the recourse just indicated, and even before or without availment thereof, the person who claims that his property has been wrongfully seized by resort to the remedy known as terceria set out in Section 17, Rule 39 of the Rules of Court, viz: SEC. 17. Proceedings where property claimed by third person. If property levied on be claimed by any other person than the judgment debtor or his agent, and such person make an affidavit of his title thereto or right to the possession thereof, stating the grounds of such right or title, and serve the same upon the officer making the levy, and a copy thereof upon the judgment creditor, the officer shag not be bound to keep the property, unless such judgment creditor or his agent, on demand of the officer, indemnify the officer against such claim by a bond in a sum not greater than the value of the property levied on. In case of disagreement as to such value, the same shall be determined by the court issuing the writ of execution. The officer is not liable for damages, for the taking or keeping of the property, to any third-party claimant unless a claim is made by the latter and unless an action for damages is brought by him against the officer within one hundred twenty (120) days from the date of the filing of the bond. But nothing herein contained shall prevent such claimant or any third person from vindicating his claim to the property by any proper action. The remedies just mentioned are without prejudice to "any proper action" that a third-party claimant may deem suitable, to vindicate "his claim to the property." Such a "proper action," in the context of Section 17 of Rule 39, has been held to refer to an action DISTINCT AND SEPARATE from that in which the judgment is being enforced. Such a "proper action" is, quite obviously, entirely distinct from the explicitly described in Section 17 of Rule 39, i.e., "an action for damages ** brought (by a third-party claimant) against the officer within one

hundred twenty (120) days from the date of the filing of the bond ** for the taking or keeping of the property" subject of the terceria. Quite obviously, too, this "proper action" would have for its object the recovery of the possession of the property seized by the sheriff, as well as damages resulting from the allegedly wrongful seizure and detention thereof despite the third-party claim; and it may be brought against the sheriff, of course, and such other parties as may be alleged to have wrongful with the sheriff in the supposedly wrongful execution proceedings, such as the judgment creditor himself. And such a "proper action," as above pointed out, is and should be an entirety separate and distinct action from that in which execution has issued, if instituted by a stranger to the latter suit. 33 ** (C)onstruing Section 17 of Rule 39 of the Revised Rules of Court, the rights of thirdparty claimant over certain properties levied upon by the sheriff to satisfy the judgment should not be decided in the action where the third- party claims have been presented, but in the separate action instituted by the claimants. This is evident from the very nature of the proceedings. In Herald Publishing, supra. We intimated that the levy by the sheriff of a property by virtue of a writ of attachment may be considered as made under authority of the court only when the property levied upon unquestionably belongs to the defendant. If he attaches properties other than those of the defendant, he acts beyond the acts of his authority. Otherwise stated, the court issuing a writ of execution is supposed to enforce its authority only over properties of the judgment debtor, and should a third party appear to claim the property levied upon by the sheriff, the procedure laid down by the Rules is that such claim should be the subject of a separate and independent action. As we explained in the Quebral case (Quebral v. Garduno, 67 Phil., 316), since the thirdparty claimant is not one of the parties to the action, she could not strictly speaking, appeal from the order denying her claim, but should file a separate reivindicatory action against the execution creditor or the purchaser of her property after the sale at public auction, or a complaint for damages against the bond filed by the judgment creditor in favor of the sheriff. We reiterated this in Potenciano v. Dineros, et al. (97 Phil. 196; Agricultural Credit Administration v. Lasam 28 SCRA 1098) when We ruled that "such reivindicatory action is reserved to the third-party claimant by Section 15 of Rule 39 despite disapproval of his claim by the court itself (Planas v. Madriga 94 Phil. 754, Lara v. Bayona, G.R. No. L7920, decided May 10, 1955)." This rule is dictated by reasons -of convenience, as "intervention is more likely to inject confusion into the issues between the parties in the case *** with which the third-party claimant has nothing to do and thereby retard instead of facilitate the prompt dispatch of the controversy which is the underlying objective of the rules of pleading and practice" ( Herald Publishing, supra, p. 101). Besides, intervention may not be permitted after trial has been concluded and a final judgment rendered in the case. 34 In such separate action, the court may issue a writ of preliminary injunction against the sheriff enjoining him from proceeding with the execution sale . 34- A Upon the other hand, if the claim of impropriety on the part of the sheriff in the execution proceedings is made by a party to the action, not a stranger thereto, any relief therefrom may be applied for with, and obtained from, only the executing court; and this is true even if a new party has been impleaded in the Suit. 35 In any case, Ong's claim that the filing of the judgment creditor's bond operated to divest the Court of jurisdiction to control and supervise the conduct of the execution sale must be rejected. That bond had absolutely no effect on the Court's jurisdiction. It was merely "equivalent to the personal interference of

the indemnitor and his bondsmen in the course of the proceeding by directing or requesting the sheriff to hold and sell the goods as if they were the property of the defendants in attachment. In doing this they (the indemnitor and his bondsmen) assume the direction and control of the sheriff's future action so far as it constitutes a trespass; and they become to that extent the principals and he their agent in the transaction. This makes them responsible for the continuance of the wrongful possession and for the sale and conversion of the goods; in other words, for all the real damages which plaintiff sustains (Love Joy vs. Murray, 70 U.S. 129). 36 Ong's third theory that the Tatings' remedy in the event of the denial of their application for relief by the Trial Court is a separate action for recovery of possession of the goods by them claimed plus damages for wrongful detention is correct and should be sustained, in line with the doctrine in Bayer, supra, 37 and the other cases which followed it. 38 As regards the matter of the inhibition of the City Court Judge, the incident has been correctly determined by the Court of Appeals. No proper ground exists to disqualify His Honor from continuing to act in Civil Case No. 28309. One last issue remains, and that is, whether the Tatings, who were living with Evangeline Roces in the premises lease by the latter from Ong, are hable for the payment of rentals in arrears jointly or solidarily with said Evangeline Roces. They are not. They were never impleaded as parties and never served with summons in the suit for ejectment initiated by Ong against Evangeline Roces. The Court therefore never acquired jurisdiction over them. And while the judgment against Evangeline Roces, in so far as it decrees her ouster from the leased premises, may be enforced not only against her but also against "any person or persons claiming under" her 39that judgment, in so far as it directs payment of money by way of arrearages in rents, is not binding on the Tatings and definitely not enforceable against them. WHEREFORE, the petition is dismissed for lack of merit. The case shall be remanded to the Metropolitan Trial Court at Quezon City which shall forthwith resolve the Tatings' pending motions in Civil Case No. 28309, consistently with the principles herein set forth. Costs against petitioner. SO ORDERED. Yap (Chairman), Melencio-Herrera, Cruz, Feliciano, Gancayco and Sarmiento, JJ., concur. G.R. No. L-25140 July 15, 1980 UNIVERSAL MOTORS CORPORATION, plaintiff-appellant, vs. MARIANO D. VELASCO, ET AL., defendants-appellees. ABAD SANTOS, J.: This is an appeal on a question of law from a decision of the Court of First Instance of Manila. Since the appeal was perfected in 1965 before the enactment of R.A. No. 5440 which took effect on September 7, 1968, a record on appeal was submitted. The plaintiff-appellant filed a brief but defendants-appellees having failed to file their brief within the reglementary period the case was submitted for decision without their brief. The uncontroverted facts are: Mariano T. Velasco bought from Universal Motors Corporation a Mercedes-Benz truck on installment basis. To the balance of the purchase price of P35,243.68 he executed a promissory note and executed a chattel mortgage over the truck. He defaulted in his payments and as a consequence the Vendor asked

him to surrender the truck in accordance will the term and conditions of the chattel mortgage contract. lie failed and refused to surrender the truck whereupon the vendor instituted an action in the court a quo to recover the truck preparatory to foreclosure of the chattel mortgage. As an alternative, in case the truck could not be recovered, the plaintiff asked for the payment, among other things, of its vs in the sum of P23,763.09 plus legal interest. By virtue of a writ of replevin issued by said court, the seller was able to re-possess the truck. Going back to the action which was commenced on December 29, 1964, the defendants failed to answer the complaint within the reglementary period and were declare in default. On April 26, 1965, defendant Velasco filed a motion to lift the default order which was granted. He did not, however, file an answer. In lieu thereof the parties, on June 15, 1965, submitted the following: STIPULATION OF FACTS COME NOW the parties in the above-entitled case, through their respective counsel and before this Honorable Court respectfully stipulate: 1. That defendant was, at the time of the filing of the complaint indebted to plaintiff in the principal sum of P23,763.09, which amount is covered by a promissory note secured by a Chattel Mo (Annex 'A' of the complaint) on a motor vehicle described in paragraph 2 of the complaint 2. That notwithstanding defendant being in default of this aforesaid mentioned sum and notwithstanding demands made by plain tiff on December 11, 1964, defendant failed to surrender the chattel described in paragraph 2 of the complaint thereby preventing plaintiff from f on the same; 3. That plaintiff is entitled to the possession of the chattel bed in paragraph 2 of the complaint and was constrained to institute the t action for recovery of possession as a preliminary stop to forced. 4. That in the se and execution of the writ of seizure issued in this cage and in g the possession of the vehicle subjected of the complaint plaintiff the occured the following expenses: a) Premium on replevin bond P971.47 b) Sheriff's expenses 300.00 c) Costs of suit 132.00 d) Mechanic's lien paid by plaintiff in defendant defendant's behalf to G. Cruz Truck Body Builder & Welding Shop 3,000.00 P 4,403.47 5. That on May 21, 1965, plaintiff received from the Workmen's Insurance Company, Inc., the sum of P1,870.99 in full settlement of the damages sustained by the truck subject matter hereof when it figured in an accident on December 5, 1964, totally immobile the motor vehicle 6. That subsequent to said event, defect failed to deliver the truck m question despite demands made by plaintiff,

7. That the following stipulation is found in paragraph 14 of the Chattel Mortgage (Annex 'A') of the complaint the genuineness and due execution of which is hereby admitted by the defendant: 14. That in case of non-compliance or violation; or default by the mortgagor, and forced or any other legal remedy is undertaken by the mortgagee to compel pa of compensation in the concept of attorney's fees and cost payment of his obligation the mortgagee shall be entitled to a reasonable election in a sum equal to twenty five percent (25%) of the total amount of the indebtedness then outstanding and unpaid by the mortgagor, but in no case less than Fifty Pesos (P50.00) as well as payment of the premium on the rep bond and was of suit in case of court action, which amounts said agree to pay and for such payment a first Em is hereby in favor of the mortgagee upon the property mortgaged. 8. That the following stipulation is also found in paragraph 10 of the Chattel Mortgage (Annex 'A' of the complaint): 10. The mortgagor further agrees that in cm non-compliance with, or violation of, any of the of the mortgage, and/or in case of default in the payment of the principle municipal sum or any part thereof or interest as and when the mm shad become due and payable, the mo property shall be delivered on demand to the mortgagee in Manila of all charges, and should be mortgage fail or refuse to deliver peacefully the said Property as above stated, the mortgagee and/or its representative or the S is hereby given full and irevocable power and authority to take possession of the said property, wherever it may be found and have the same brought in the City of Manila the HEREBY RATIFYING AND CONFIRMING all that said mortgagee and/or its representative and/or the Sheriff shall lawfully do or cause to be done under and by virtue of these presents and the expenses of locating and bringing property to the City of Manila shall the account of the mortgegee and shall form part of the sum by this mortgage ... 9. That plaintiff waives the attorney's fees herein stipulated, but not the reasonable amount that may be adjudged by this Honorable Court, the premium of the replevin bond, sheriff's expenses, costs of suit and the mechanic's lien mentioned in paragraph 4 herein. 10. That plaintiff admits that it is not entitled to deficiency judgment on the principal sum of P23,763.09 once it has foreclosed on the mortgage, but only to a reasonable amount of attorney's fees and those amounts mentioned in paragraph 4 herein, less the amount of P1,870.99 paid by the insurance company. Acting on the stipulation, the court a quo rendered a decision part of which reads as follows: The only issue is whether the plaintiff is entitled to recover the expenses mentioned in paragraph 4 and attorney's fees . It undoubtedly has a right to repayment for the premium on the replevin bond it filed, the sheriff's fees, costs of this suit, and a reasonable sum as attorney's fees. These are expenses rendered necessary by the defendant's refusal to surrender voluntarily possession of the vehicle, in violation of his agreement with the plaintiff. But the mechanic's lien the plaintiff satisfied is not recoverable in this action. Nothing is said about it in the complaint and it is not one of the reliefs sought therein. It must be understood, however, that all sums adjudged in the plaintiff's favor may be enforced only against the proceeds of the vehicle mortgaged in accordance with the settled rule that in an proceedings for foreclosure of mortgages executed on chattels which have been sold on the installment plan, the mortgagee is limited to the property

included in the mortgage. Macondray & Co. vs. Tan, 38, O.G. 2606; Macondray & Co. vs. Ruiz, 38, O.G. 2168; and Bachrach Motor Co. vs. Milan, 61 Phil. 409. WHEREFORE, judgment is hereby rendered declaring that the plaintiff is entitled to the possession of the vehicle described in the complaint and ordering the defendant Mariano Velasco to pay the plaintiff P1,403.47 as well as the additional sum of P1,500.00 as attorney's fees to be satisfied out of the proceeds of the sale vehicle. The plaintiff filed a motion requesting that the Court " reconsider its decision dated June 28, 1965, by requiring the defendant to pay plaintiff directly the sums of P1,403.47 and P500.00 instead of o the satisfaction of the same from the p of the auction sale ." When the motion was domed the plaintiff appealed as aforementioned assuming only one , namely "The lower court erred in that the sums adjudged in favor of the plaintiff are to be satisfied only vehicle. In stipulating that the sums adjudged P971.41, premium on replevin bond, P300.00, sheriff's P132.00, costs of the suit total P1,403.47; and P500.00, attorney's fees the lower court relied on the provisions of Article 1484 of the Civil Code which insofar as relevant reads as follows: Art 1484. In a contract of sale of property the price of which is payable in to, the vs may any of the following xxx xxx xxx (3) Foreclose the chattel mortgage on the thing sold if one has been constituted, should the vendee's failure to pay cover two or more installment In this case, he shag have no further action against the purchase to recover any unpaid of the balance of the price Any agreement to the contrary shall be void. The third paragraph of Art. 1484 is inapplicable to the cam at bar. First, as the plaintiff has correctly pointed out the action instituted in the court a quo was not foreclosure at the chattel/mortgage but for the replevin; and second, the amounts adjudged in favor of the plaintiff were not part of the unpaid balance of the price" or in the concept of a deficiency judgment but were for expenses of the suit. WHEREFORE, the judgment appealed from is modified by ordering the defendant-appellee Mariano D. Velasco to pay the amount adjudged m favor of the plaintiff-appellant of having the same satisfied out of the proceeds of the auction sale on the motor vehicle the defendant-appellee. SO ORDERED. Concepcion, Jr., and De Castro, JJ., concur. G.R. No. L-45114 October 26, 1987 APOLONIO SUMBINCO, petitioner, vs. COURT OF APPEALS, et al., respondents. No. L-45192 October 26, 1987 JEPTE DEMERIN et al., petitioners, vs. COURT OF APPEALS, et al., respondents.

NARVASA, J.: Jepte Demerin Rogelio Argel, Demetrio Jongco and Alfonso Demerin filed with the Court of Agrarian Relations a complaint against Apolonio Sumbingco, seeking their reinstatement as tenants on the latter two (2) haciendas and the payment to them of damages for their ouster therefrom. According to them, prior to the purchase by Sumbingco of the haciendas in question from Ricardo Nolan, they were already tenants of the latter, planting the areas occupied by them 'with rice: that even after Sumbingco acquired the land they continued as tenants thereon by permission of Sumbingco's administrator; that Sumibingco caused the planting of their landholdings to citrus little by little, thus progressively depriving them of possession thereof until the time came when their landholdings were completely planted to citrus and they were effectively, divested of any area to cultivate: that in view thereof, they asked Sumbingco to compensate them for the loss of their tenacy rights but although the former promised to do so, he never did; that instead, in 1964, Sumbingco told them to vacate their landholdings. The court of Agrarian Relations dismissed their complaint. It declined to give credence to the evidence proferred by them to substantiate their claim of being Sumbingco's tenants , declaring that evidence to be both implausible and tainted by material trial inconsistencies. On appeal, however, the court of Appeals reversed the judgment of the Court of Agrarian Relation . It ruled that in the light of the admission that Jepte Demerio and his co-plaintiffs were tenants in at least one of the haciendas prior to the sale to Sumbingco, it was difficult to believe the latter's protestation that he had never seen them; at the very least, Sumbingco's overseer should have apprised him of their presence on the land; hence, it was safe to assume that Demerin and his companions continued as tenants on the land under the new owner. The Appellate Court accordingly ordered the payment to Demerin, et al. of damages by Sumbingco but not their reinstatement on the ground that the landholdings had already been completely planted to citrus. Both Sumbingco and the Demerin group have taken an appeal by certiorari to this Court, the former's being docketed as G.R. No. 45114 and the latter's, G.R. No. 45192. It is axiomatic that appeals from the Court of Appeals are not a matter of right but of sound judicial discretion on the part of this Court, and will be granted only when there are special and important reasons therefor. 1 In other words, appeals from the Court of Appeals are not entertained as a matter of routine; they may be rejected out of hand in the exercise of this Court's sound judicial discretion. The prescribed mode of appeal is by certiorari, 2limited only to issues or questions of law which must be distinctly set forth in the petition for review on certiorari. 3The findings of fact of the Appellate Court are conclusive even on this Court, subject only to a few well defined exceptions (none of which is present in the instant case). 4 It is incumbent on the appellant to make out a sufficiently strong demonstration of serious error on the part of the Court of Appeals, and adduced special and important reasons to justlfy the exercise by this Court of its discretionary appellate jurisdiction, 5 failing in which this Court will decline to wield its invoked power of review and will dismiss the appeal on the ground that it is without merit, or is prosecuted manifestly for delay or the questions raised are too unsubstantial to require consideration. 6 A thoroughgoing review of the record discloses that contrary to this Court's first impression, which initially led it to give due course to both petitions in its case, there is no special and important reason to justify this Court's exercise of its appellate jurisdiction. The issues raised are principally factual, and such of those issues as may be characterized as legal are not sufficiently weighty or substantial to warrant consideration and review. WHERFFORE, the petitions in G.R. No. 45114 and G.R. No. 45192 are DENIED, and the decision of the Court of Appeals sought to be thereby reviewed is affirmed. This decision is immediately, executory, and no motion for extension of time to file a motion for reconsideration will be entertained.

Teehankee, C.J., Cruz, Paras * and Gancayco, JJ., concur. G.R. No. 111837 October 24, 1995 NEW YORK MARINE MANAGERS, INC., petitioner, vs. COURT OF APPEALS and VLASONS SHIPPPING INC., respondents. BELLOSILLO, J.: NEW YORK MARINE MANAGERS, INC., a foreign corporation organized under the laws of the United States, seeks in this special civil action for certiorari under Rule 65 of the Rules of Court 1 the annulment of the decision of the Court of Appeals which reversed the ruling of the trial court denying the motion to dismiss of private respondent Vlasons Shipping Company, Inc. On 25 July 1990 American Natural Soda Ash Corporation (ANSAC) loaded in Portland, U.S.A., a shipment of soda ash on board the vessel " MS Abu Hanna" for delivery to Manila. The supplier/shipper insured the shipment with petitioner. Upon arrival in Manila the shipment was unloaded and transferred to the vessel "MV Biyayang Ginto" owned by private respondent. Since the shipment allegedly sustained wettage, hardening and contamination, it was rejected as total loss by the consignees. When the supplier sought to recover the value of the cargo loss from petitioner the latter paid the claim in the amount of US$58,323.96. On 20 November 1991 petitioner as subrogee filed with the Regional Trial Court of Manila a complaint for damages against private respondent alleging among others that . . . 1.01. Plaintiff is a non-life foreign insurance corporation organized under the laws of the State of New York with offices at 123 William Street, New York, N.Y. 10038 and engaged in an isolated transaction in this case; defendant is a local domestic corporation organized under Philippine law with offices at Zobel Street, Isla de Provisor, Paco, Metro Manila where it may be served with summons and other court processes . . . . 2 On 24 January 1992 private respondent filed a motion to dismiss the complaint alleging that: (a) The complaint was filed by counsel who had no authority to sue for plaintiff; (b) The complaint stated no cause of action or without a cause of action as (a) there was no privity of contract between plaintiff and defendant; (b) the risks which allegedly caused damages on the goods were not covered by the insurance issued by plaintiff, and (c) the charter agreement between the consignee, ALCHEMCO PHILIPPINES, INC., and private respondent absolved the latter from all kinds of claim whatsoever; (3) The claim of plaintiff was already extinguished, waived, abandoned and/or had prescribed; and, (4) Plaintiff had no legal capacity to sue. On 5 February 1992 petitioner opposed the motion to dismiss. On 10 April 1992 the trial court denied the motion. On 18 August 1992 the motion to reconsider the denial was also denied. The trial court ruled that since petitioner alleged in its complaint that it was suing on an isolated transaction the qualifying circumstance of plaintiff's capacity to sue as an essential element has been properly pleaded. The trial court also held that the grounds relied upon by private respondent in its motion to dismiss were matters of defense. On 28 September 1992 private respondent filed a petition for certiorari and prohibition with the Court of Appeals alleging that the trial court gravely abused its discretion in issuing the orders of 10 April 1992 and 18 August 1992 which amounted to lack or excess of jurisdiction.

On 29 July 1993 the appellate court granted the petition after finding the assailed orders to be patently erroneous. 3 While it found the allegation in the complaint that plaintiff was a non-life foreign insurance corporation engaged in an isolated transaction to be a sufficient averment, it nevertheless held the complaint to be fatally defective for failure to allege the duly authorized representative or resident agent of petitioner in the Philippines. Thus it enjoined the trial court from further proceeding except to dismiss the case with prejudice. This petition alleges that the Court of Appeals acted whimsically, capriciously and arbitrarily amounting to lack or excess of jurisdiction in deciding that petitioner's complaint was fatally defective for failing to allege its duly authorized representative or resident agent in the Philippines. Petitioner argues that there is no law, substantive or procedural, that requires a foreign corporation engaged only in an isolated transaction to appoint a duly authorized representative or a resident agent in the Philippines before it can sue locally. The proper remedy available to petitioner from a decision of the Court of Appeals is a petition for review on certiorari under Rule 45 of the Rules of Court, not a petition for certiorari under Rule 65 of the Rules of Court. Mere errors of judgment cannot be the proper subject of a special civil action for certiorari. Where the issue or question involved affects the wisdom or legal soundness of the decision not the jurisdiction of the court to render said decision the same is beyond the province of a special civil action for certiorari. Erroneous findings and conclusions do not render the appellate court vulnerable to the corrective writ of certiorari. For where the court has jurisdiction over the case, even if its findings are not correct, they would, at most, constitute errors of law and not abuse of discretion correctible by certiorari. 4 But even if we treat the instant petition as one for review on certiorari the same must still fail. The issue on whether a foreign corporation can seek the aid of Philippine courts for relief recoils to the basic question of whether it is doing business in the Philippines or has merely entered into an isolated transaction. This Court has held in a long line of cases that a foreign corporation not engaged in business in the Philippines may exercise the right to file an action in Philippine courts for an isolated transaction. 5 However, in Commissioner of Customs v. K.M.K. Gani et a1., 6 citing Atlantic Mutual Insurance Company v. Cebu Stevedoring, Inc., 7 we ruled that to say merely that a foreign corporation not doing business in the Philippines does not need a license in order to sue in our courts does not completely resolve the issue. When the allegations in the complaint have a bearing on the plaintiff's capacity to sue and merely state that the plaintiff is a foreign corporation existing under the laws of the United States, such averment conjures two alternative possibilities: either the corporation is engaged in business in the Philippines, or it is not so engaged. In the first, the corporation must have been duly licensed in order to maintain the suit; in the second, and the transaction sued upon is singular and isolated, no such license is required. In either case, compliance with the requirement of license, or the fact that the suing corporation is exempt therefrom, as the case may be, cannot be inferred from the mere fact that the party suing is a foreign corporation. The qualifying circumstance being an essential part of the plaintiff's capacity to sue must be affirmatively pleaded. Hence, the ultimate fact that a foreign corporation is not doing business in the Philippines must first be disclosed for it to be allowed to sue in Philippine courts under the isolated transaction rule. 8 Failing in this requirement, the complaint filed by petitioner with the trial court, it must be said, fails to show its legal capacity to sue. Moreover, petitioner's complaint is fatally defective for failing to allege its duly authorized representative or resident agent in this jurisdiction. The pleadings filed by counsel for petitioner do not suffice. True, a lawyer is generally presumed to be properly authorized to represent any cause in which he appears, and no written power of attorney is required to authorize him to appear in court for his client. But this presumption is disputable. Where said authority has been challenged or attacked by the adverse party the lawyer is required to show proof of such authority or representation in order to bind his client. The requirement of the production of authority is essential because the client will be bound by his acquiescence resulting from his knowledge that he was being represented by said attorney. 9 In the instant case, the extent of authority of counsel for petitioner has been expressly and

continuously assailed but he has failed to show competent proof that he was indeed duly authorized to represent petitioner. WHEREFORE, the petition is DENIED. The assailed decision of the Court of Appeals dated 29 July 1993 is AFFIRMED. Costs against petitioner. SO ORDERED. Padilla, Davide, Jr., Kapunan and Hermosisima, Jr., JJ., concur.

[G.R. No. 117499. February 9, 1996]

SPOUSES VICTOR WARLITO V. YBAEZ and VIRGINIA A. YBAEZ, represented by their attorneyin-fact, FORTUNATO V. YBAEZ, petitioners, vs. COURT OF APPEALS; REGIONAL TRIAL COURT OF RIZAL, BR. NO. 154; METROPOLITAN TRIAL COURT OF PASIG, BR. NO. 72; and SPOUSES AVELINO P. IFURUNG and VIRGINIA F. IFURUNG, respondents.

DECISION FRANCISCO, J.: This is the factual background. In December 1984, petitioners spouses Victor Warlito V. Ybaez and Virginia A. Ybaez , as vendors, entered into a Deed of Sale With Assumption of Mortgage and With Right of Purchase over a mortgaged 400 sq. m. parcel of land in favor of private respondents spouses Avelino P. Ifurung and Virginia F. Ifurung, as vendees. The deed of sale has, among others, the following salient terms: (1) private respondents shall pay the sum of P118,000.00 to the petitioners and assume the obligations under the Deed of Mortgage of the subject property with the Development Bank of the Philippines (DBP); (2) petitioners shall have the right to repurchase the property within three months from the date of the sale; (3) failure on the part of petitioners to repurchase within the agreed period will cause the transfer of the property to private respondents without reservation, and petitioners will vacate the subject property and surrender possession thereof in favor of private respondents. [1] To enable the private respondents to pay the monthly amortizations to the DBP, petitioners executed a power of attorney for the purpose, which was subsequently revoked by them.[2] The agreed three-month period expired without petitioners exercising their right to repurchase the subject property. Private respondents, through counsel, demanded that petitioners surrender the possession of the subject property and vacate the premises in accordance with the deed of sale, only to be unheeded. Thus, in 1992, private respondents filed an ejectment suit against petitioners before the Metropolitan Trial Court (MTC) docketed as Civil Case No. 2751. Summons were issued and served by substituted service thru Engr. and Mrs. Nomer Ybaez (brother of Mr. Victor Warlito V. Ibalez [sic]) [3]. As a result of petitioners failure to file an answer, the MTC, in accordance with Section 6 of the Revised Rules on Summary Procedure, motu propio rendered judgment in favor of private respondents ordering petitioners to deliver possession and vacate the premises in question [and] to pay x x x the amount[s] of P5,000.00 for and as attorneys fees, x x x P309,000.00 as reasonable rent at P3,000.00 per month starting March, 1984 until September 1992, x x x [and] to pay the costs. [4]

Petitioners appealed before the Regional Trial Court (RTC) of Pasig, Branch 154, docketed as SCA No. 253, and premised the same on the alleged lack of valid service of summons over their persons. They asserted that service of summons to Engr. and Mrs. Nomer Ybaez is improper and invalid since petitioners, as early as 1988, have left for abroad, although it is uncontroverted that the latter spouses (Engr. and Mrs Nomer Ybaez) were found residing at petitioners last known address. The appeal did not prosper. Finding the substituted service of summons proper and valid, the RTC affirmed the MTC decision, but modified the amount of reasonable rentals to P3,000.00 a month beginning September 13, 1991 with legal interest of 6% per annum until defendants [petitioners herein] actually vacate the premises.[5] Petitioners thereafter filed a notice of appeal signifying their intention to appeal the judgment to the Court of Appeals which was denied due course by the RTC on the ground that it is not the proper remedy[6] - the correct recourse being the filing of a petition for review.[7] On March 31, 1993, petitioners filed a motion for new trial before the RTC. In an Order dated March 11, 1994, the RTC denied the motion for having been filed beyond the reglementary period, among others. [8] With the denial of private respondents motion and the decision having attained finality, the RTC in SCA No. 253 issued a writ of execution dated March 22, 1994, and subsequently caused the entry of the judgment through an Order dated September 1, 1994. In a bid to nullify the deed of sale, petitioners commenced an action for Cancellation of Deed of Sale With Assumption of Mortgage and With Right of Repurchase With Damages, before RTC Branch 156, docketed as Civil Case No. 64437.[9] On September 16, 1994, RTC Branch 156 dismissed for lack of merit petitioners complaint for cancellation of the deed of sale. This dismissal is now pending appeal before the Court of Appeals. Apparently, in a desperate move, on May 2, 1994, petitioners filed another action - a petition for annulment of judgment of the RTC in SCA No. 253 before respondent Court of Appeals ,[10] now the subject of this petition. Petitioners assailed the validity of the substituted service of summons over their persons in the MTC ejectment case, an issue well settled in their appeal before the RTC. Likewise, petitioners attacked the RTC jurisdiction to modify and affirm on appeal the MTC decision and further contended that private respondents obtained the judgment by default against the petitioners by means of extrinsic fraud[11] Respondent court reversed the RTC in so far as the validity of the substituted service of summons is concerned and ruled that there was an improper substituted service of summons upon petitioners. However, respondent court stressed that the RTCs decision is not void since, by asking for affirmative relief through their appeal and motion for new trial before the RTC, petitioners were effectively barred from questioning the validity of the substituted service of summons, as well as the RTCs jurisdiction over their persons. On the issue of extrinsic fraud, respondent court ruled that there was no extrinsic fraud to warrant the annulment of the MTC and RTC judgments. Dissatisfied, but without filing a motion for reconsideration for no apparent reason, petitioners filed the instant petition stressing that t]his is a petition for certiorari, both under Rule 65 and Rule 45, Rules of Court[12] raising substantially the following issues: (1) whether or not the SUBSTITUTED SERVICE OF SUMMONS over the persons of the petitioners in the ejectment case was valid to vest the MTC jurisdiction over their persons, and (2)whether or not the judgments of the MTC in the ejectment suit and of the RTC on appeal were obtained by means of extrinsic fraud to warrant their nullification. [13] At the outset, we note that petitioners immediately filed this petition without even filing a motion for reconsideration of the assailed decision thereby depriving respondent court of the opportunity to correct at the first instance an error which it may have committed. We see no cogent reason and none was persuasively presented to excuse petitioners from their failure to file a motion for reconsideration. Also glaring is the ambivalent, if not irresolute, posture taken by the petitioners by categorizing this petition to be both under Rule 65 and Rule 45, Rules of Court[14] in an attempt, apparently, to evade the dismissal of the petition based on a wrong mode of appeal in accordance with Circular No. 2-90 issued on March 9, 1990. The court cannot tolerate this practice much less the seeming ignorance of the law on appeals. This petition cannot be subsumed simultaneously under Rule 45 and Rule 65 of the Rules of Court, and neither may petitioners delegate upon the court the task of determining under which rule the petition should fall. Under Circular No. 2-90, wrong or inappropriate mode of appeal, as in this case, merits an outright dismissal. In fact, paragraph 4 (e) of the circular specifically warns litigants counsels by providing the following:

Duty of counsel. - It is therefore incumbent upon every attorney who would seek review of a judgment or order promulgated against his client to make sure of the nature of the errors he proposes to assign, whether these be of fact or law; then upon such basis to ascertain carefully which Court has appellate jurisdiction; and finally, to follow scrupulously the requisites for appeal prescribed by law, ever aware that any error or imprecision in compliance may well be fatal to his clients cause. The disposition of this case could have stopped here without further ado, but nevertheless we will briefly deal with the assigned issues for while the respondent court correctly dismissed the action for annulment of judgment, its reversal of the RTC ruling on the issue of substituted service of summons is misplaced. On the first issue, we feel that respondent court acted inadvertently when it set aside the RTC ruling relative to the validity of the substituted service of summons over the persons of the petitioners in the MTC level. We must not lose sight of the fact that what was filed before respondent court is an action to annul the RTC judgment and not a petition for review. Annulment of judgment may either be based on the ground that a judgment is void for want of jurisdiction [15] or that the judgment was obtained by extrinsic fraud.[16] There is nothing in the records that could cogently show that the RTC lacked jurisdiction. Chiefly, Section 22 of B.P. Blg. 129, otherwise known as the Judiciary Reorganization Act of 1980, vests upon the RTC the exercise of an appellate jurisdiction over all cases decided by the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts in their respective territorial jurisdictions.[17] Clearly then, when the RTC took cognizance of petitioners appeal from the adverse decision of the MTC in the ejectment suit, it (RTC) was unquestionably exercising its appellate jurisdiction as mandated by law. Perforce, its decision may not be annulled on the basis of lack of jurisdiction as it has, beyond cavil, jurisdiction to decide the appeal. Corollarily, it is inappropriate for respondent court to reverse the RTC ruling that there was proper and valid substituted service of summons over the persons of the petitioners. Petitioners properly assigned this issue and, in fact, it was exhaustively argued in their appeal, albeit without success. They subsequently failed to seasonably question the soundness of the RTC ruling before respondent court via a petition for review. As it stands, therefore, the ruling of the RTC that substituted service of summons was validly effected has long acquired finality. Raising this long settled issue in the annulment case could very well be petitioners device and technique to acquire a fresh opportunity to assail this ruling, a chance they already lost because of their failure to seasonably file a petition for review. This scheme is highly irregular and may as well constitute misuse of court processes. [18] In addition, it stultifies and renders asunder the principle, well embedded in our jurisprudence, that a judgment properly rendered by a court vested with jurisdiction. like the RTC. and which has acquired finality becomes immutable and unalterable, hence, may no longer be modified in any respect except only to correct clerical errors or mistakes.[19] Judgments of courts become final at some definite time fixed by law and that parties, like the petitioners, should not be permitted to litigate the same issue/s over again. Moreover, a party cannot, by varying the form of action, or adopting a different method of presenting his case, escape the effect of a valid judgment. Section 49 (b) and (c), Rule 39 of the Rules of Court states:
SEC. 49. Effect of judgments. - The effect of a judgment or final order rendered by a court or judge of the Philippines, having jurisdiction to pronounce the judgment or order, may be as follows: xxx xxx xxx

(b) In other cases the judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive between the parties and their successors-in-interest by title subsequent to the commencement of the action or special proceeding, litigating for the same thing and under the same title and in the same capacity; (c) In any other litigation between the same parties or their successors-in-interest, that only is deemed to have been adjudged in a former judgment which appears upon its face to have been so adjudged, or which was actually and necessarily included therein or necessary thereto.

These provisions embody the same rule that once a judgment has become final and executory, the issues therein should be laid to rest. Paragraph (b) is referred to as bar by former judgment. It is a concept in which the term res judicata is more commonly and generally used and has the following concurring requisites, namely: (1) the former judgment or order must be final; (2) it must be a judgment or order on the merits, that is, it was rendered after a consideration of the evidence or stipulations submitted by the parties at the trial of the case; (3) it must have been rendered by a court having jurisdiction over the subject matter and the parties; (4) there must be, between the first and second actions, identity of parties, of subject matter and of cause of action. Paragraph (c) is the less familiar concept or less terminological usage of res judicata known as conclusiveness of judgment. This concept, which applies in this case, refers to a situation where the judgment in the prior action operates as an estoppel only as to the matters actually determined or necessarily included therein. Otherwise stated, conclusiveness of judgment precludes relitigation of a particular fact or issue in another action between the same parties on a different claim or cause of action.[20] With the validity of the substituted service of summons having been settled in the RTC and having long acquired finality, petitioners are now precluded to relitigate the same issue. Litigation must have and always has an end. If not, judicial function will lose its relevance. With respect to the second issue, we agree with respondent courts succinct disposition that the MTC judgment was not obtained by extrinsic fraud to warrant annulment. Respondent court amply explained extrinsic fraud and applied the same in this wise:
The kind of fraud that justifies the annulment of a judgment is extrinsic fraud. This refers to some act or conduct of the prevailing party which has prevented the aggrieved party from having a trial or presenting his case to the court, or was used to procure judgment without a fair submission of the controversy. Extrinsic fraud refers to acts outside the trial. It must be distinguished from intrinsic fraud which refers to acts of a party at a trial which prevented a fair and just determination of the case and which could have been litigated and determined at the trial or adjudication of the case. Examples of intrinsic fraud are falsification and false testimony. The petitioners argued that the private respondents committed extrinsic fraud when they did not inform the trial court that they (private respondents) have not assumed the mortgage of the property in question. Applying the definition stated earlier, the fraud supposed to have been committed does not amount to extrinsic fraud. The omission was done within the trial or the litigation process, particularly in the complaint for ejectment filed before the Metropolitan Trial Court. If such omission were fraudulent, it would have constituted intrinsic fraud which could have been determined in the adjudication of the case. As such, even if it were proven, the supposed fraud does not justify the annulment of the judgment.[21]

Similarly, the RTC decision in SCA No. 253 was not attended by extrinsic fraud. We find nothing, either act or conduct on the part of private respondents, that may have prevented petitioners from presenting their case to the court. Indeed, the record is bereft of any iota of evidence that could show the contrary. WHEREFORE, save for some modifications in respondent courts findings which, nonetheless, did not alter the final outcome of the case, the petition is hereby DISMISSED. SO ORDERED. Narvasa, C.J. (Chairman), Davide, Jr., Melo, and Panganiban, JJ., concur.