Republic of the Philippines

Supreme Court
Manila

FIRST DIVISION


PETRONILO J. BARAYUGA,
Petitioner,

-versus-

ADVENTIST UNIVERSITY OF
THE PHILIPPINES,
THROUGH ITS BOARD OF
TRUSTEES, REPRESENTED
BY ITS CHAIRMAN, NESTOR
D. DAYSON,
Respondents.
G.R. No. 168008


Present:

CORONA, C.J., Chairperson,
LONAR!O-! CAS"RO,
#RSAM$N,
!L CAS"$LLO, and
%$LLARAMA, &R., JJ.

Promul'ated:

Au'ust (), *+((
x-----------------------------------------------------------------------------------------x

D E C I S I O N

BERSAMIN, J:

"he in,uncti-e relief protects onl. a ri'ht in esse. /here the plaintiff does
not demonstrate that he has an e0istin' ri'ht to be protected b. in,unction, his suit
for in,unction must be dismissed for lac1 of a cause of action.

"he dispute centers on 2hether the remo-al of the petitioner as President of
respondent Ad-entist 3ni-ersit. of the Philippines 4A3P5 2as -alid, and 2hether
his term in that office 2as fi-e .ears, as he insists, or onl. t2o .ears, as A3P
insists.

/e hereb. re-ie2 the decision promul'ated on Au'ust 6, *++7,
8(9
b. 2hich
the Court of Appeals 4CA5 nullified and set aside the 2rit of preliminar. in,unction
issued b. the Re'ional "rial Court 4R"C5, #ranch *(, in $mus, Ca-ite to pre-ent
A3P from remo-in' the petitioner.

An!"!#!n$

A3P, a non-stoc1 and non-profit domestic educational institution
incorporated under Philippine la2s on March :, (;:*, 2as directl. under the North
Philippine 3nion Mission 4NP3M5 of the Southern Asia Pacific !i-ision of the
Se-enth !a. Ad-entists. !urin' the :
rd
<uin=uennial Session of the >eneral
Conference of Se-enth !a. Ad-entists held from No-ember *), *+++ to !ecember
(, *+++, the NP3M 0ecuti-e Committee elected the members of the #oard of
"rustees of A3P, includin' the Chairman and the Secretar.. Respondent Nestor
!. !a.son 2as elected Chairman 2hile the petitioner 2as chosen Secretar..

On &anuar. *:, *++(, almost t2o months follo2in' the conclusion of the
:
rd
<uin=uennial Session, the #oard of "rustees appointed the petitioner President
of A3P.
8*9
!urin' his tenure, or from No-ember (( to No-ember (:, *++*, a 'roup
from the NP3M conducted an e0ternal performance audit. "he audit re-ealed the
petitioner?s autocratic mana'ement st.le, li1e ma1in' ma,or decisions 2ithout the
appro-al or recommendation of the proper committees, includin' the @inance
CommitteeA and that he had himself done the can-assin' and purchasin' of
materials and made 2ithdra2als and reimbursements for e0penses 2ithout -alid
supportin' receipts and 2ithout the appro-al of the @inance Committee. "he audit
concluded that he had

committed serious -iolations of fundamental rules and procedure in the
disbursement and use of funds.

"he NP3M 0ecuti-e Committee and the #oard of "rustees decided to
immediatel. re=uest the ser-ices of the >eneral Conference Auditin' Ser-ice
4>CAS5 to determine the -eracit. of the audit findin's. Accordin'l., >CAS
auditors 2or1ed in the campus from !ecember 7 to !ecember *+, *++* to re-ie2
the petitioner?s transactions durin' the period from April *++* to October *++*.
On !ecember *+, *++*, C>AS auditors reported the results of their re-ie2, and
submitted their obser-ations and recommendations to the #oard of "rustees.

3pon receipt of the C>AS report that confirmed the initial findin's of the
auditors on &anuar. B, *++:, the NP3M informed the petitioner of the findin's and
re=uired him to e0plain.

On &anuar. (6, *++:, Chairman !a.son and the NP3M "reasurer li1e2ise
informed the petitioner inside the NP3M office on the findin's of the auditors in
the presence of the A3P %ice-President for @inancial Affairs, and reminded him of
the possible conse=uences should he fail to satisfactoril. e0plain the irre'ularities
cited in the report. Ce replied that he had alread. prepared his 2ritten e0planation.

"he #oard of "rustees set a special meetin' at * p.m. on &anuar. **,
*++:. #ein' the Secretar., the petitioner himself prepared the a'enda and included
an item on his case. $n that meetin', he pro-ided copies of the auditors? report and
his ans2ers to the members of the #oard of "rustees. After hearin' his
e0planations and oral ans2ers to the =uestions raised on issues arisin' from the
report, the members of the #oard of "rustees re=uested him to lea-e to allo2 them
to anal.De and e-aluate the report and his ans2ers. !espite a lon' and careful
deliberation, ho2e-er, the members of the #oard of "rustees decided to ad,ourn
that ni'ht and to set another meetin' in the follo2in' 2ee1 considerin' that the
meetin' had not been specificall. called for the purpose of decidin' his case. "he
ad,ournment 2ould also allo2 the #oard of "rustees more time to ponder on the
commensurate disciplinar. measure to be meted on him.

On &anuar. *:, *++:, Chairman !a.son notified the petitioner in 2ritin' that
the #oard of "rustees 2ould hold in abe.ance its deliberation on his ans2er to the
auditors? report and 2ould meet a'ain at (+:++ a.m. on &anuar. *), *++:.
Chairman !a.son indicated that some sectors in the campus had not been properl.
represented in the &anuar. **, *++: special meetin', and re=uested the petitioner as
Secretar. to ensure that all sectors are dul. represented in the ne0t meetin' of the
#oard of "rustees.
8:9

$n the &anuar. *), *++: special meetin', the petitioner sent a letter to the
#oard of "rustees. "he members, b. secret ballot, -oted to remo-e him as
President because of his serious -iolations of fundamental rules and procedures in
the disbursement and use of funds as re-ealed b. the special auditA to appoint an
interim committee consistin' of three members to assume the po2ers and functions
of the PresidentA and to recommend him to the NP3M for consideration as
Associate !irector for Secondar. ducation.
879

On &anuar. *B, *++:, the petitioner 2as handed inside the NP3M office a
letter, to'ether 2ith a cop. of the minutes of the special meetin' held the pre-ious
da.. $n turn, he handed to Chairman !a.son a letter re=uestin' t2o 2ee1s 2ithin
2hich to see1 a reconsideration, statin' that he needed time to obtain supportin'
documents because he 2as then attendin' to his d.in' mother.
869


$n the e-enin' of &anuar. *B, *++:, the #oard of "rustees, most of 2hose
members had not .et left Ca-ite, recon-ened to consider and decide the petitioner?s
re=uest for reconsideration. !urin' the meetin', he made an emotional appeal to
allo2 him to continue as President, promisin' to immediatel. -acate his office
should he a'ain commit an. of the irre'ularities cited in the auditors? report. Ce
added that should the #oard of "rustees not fa-or his appeal, he 2ould settle for a
retirement pac1a'e for him and his 2ife and 2ould lea-e the church.

"he #oard of "rustees denied the petitioner?s re=uest for reconsideration
because his reasons 2ere not meritorious. #oard Member liDabeth Role ser-ed
the notice of the denial on him the ne0t da., but he refused to recei-e the notice,
simpl. sa.in' Alam ko na yan.
8E9


"he petitioner later obtained a cop. of the inter-school memorandum dated
&anuar. :(, *++: informin' A3P students, staff, and facult. members about his
relief as President and the appointment of an interim committee to assume the
po2ers and duties of the President.

On @ebruar. 7, *++:, the petitioner brou'ht his suit for in,unction and
dama'es in the R"C, 2ith pra.er for the issuance of a temporar. restrainin' order
4"RO5, impleadin' A3P and its #oard of "rustees, represented b. Chairman
!a.son, and the interim committee. Cis complaint alle'ed that the #oard of
"rustees had relie-ed him as President 2ithout -alid 'rounds despite his fi-e-.ear
termA that the #oard of "rustees had thereb. acted in bad faithA and that his bein'
denied ample and reasonable time to present his e-idence depri-ed him of his ri'ht
to due process.
8)9

"he suit bein' intra-corporate and summar. in nature, the application for
"RO 2as heard b. means of affida-its. $n the hearin' of @ebruar. ), *++:, the
parties a'reed not to harass each other. "he R"C used the mutual a'reement as its
basis to issue a status quo order on @ebruar. ((, *++:.
8B9

$n their ans2er 2ith counterclaim, the respondents denied the alle'ations of
the petitioner, and a-erred that he had been -alidl. remo-ed for causeA and that he
had been 'ranted ample opportunit. to be heard in his defense.
8;9

O%#!% o& '! RTC

On March *(, *++:, after summar. hearin', the R"C issued the "RO
en,oinin' the respondents and persons actin' for and in their behalf from
implementin' the resolution remo-in' him as President issued b. the #oard of
"rustees durin' the &anuar. *), *++: special meetin', and en,oinin' the interim
committee from performin' the functions of President of A3P. "he R"C did not
re=uire a bond.
8(+9

After further hearin', the R"C issued on April *6, *++: its contro-ersial
order,
8((9
'rantin' the petitioner?s application for a 2rit of preliminar. in,unction. $t
thereb. resol-ed three issues, namel.: 4a5 2hether the special board meetin's 2ere
-alidA 4b5 2hether the conflict-of-interest pro-ision in the #.-La2s and /or1in'
Polic. 2as -iolatedA and 4c5 2hether the petitioner 2as denied due process. $t
found for the petitioner upon all the issues. On the first issue, it held that there 2as
neither a 2ritten re=uest made b. an. t2o members of the #oard of "rustees nor
proper notices sent

to the members as re=uired b. A3P?s #.-La2s, 2hich omissions, bein' patent
defects, tainted the special board meetin's 2ith nullit.. Anent the second issue, it
ruled that the purchase of coco lumber from his balae 4i.e., mother-in-la2 of his
son5 2as not co-ered b. the conflict-of-interest pro-ision, for A3P?s Model
Statement of Acceptance form mentioned onl. the members of the immediate
famil. and did not e0tend to the relationship bet2een him and his balae. On the
third issue, it concluded that he 2as depri-ed of due process 2hen the #oard of
"rustees refused to 'rant his motion for reconsideration and his re=uest for
additional time to produce his e-idence, and instead immediatel. implemented its
decision b. relie-in' him from his position 2ithout accordin' him the treatment
befittin' a uni-ersit. President.


P%o"!!#(n)$ (n '! CA

/ith the $nterim Rules for $ntra-Corporate Contro-ersies prohibitin' a
motion for reconsideration, the respondents forth2ith filed a petition
for certiorari in the CA,
8(*9
contendin' that the petitioner?s complaint did not meet
the re=uirement that an in,uncti-e 2rit should be anchored on a le'al ri'htA and that
he had been merel. appointed, not elected, as President for a term of office of onl.
t2o .ears, not fi-e .ears, based on A3P?s amended #.-La2s.

$n the mean2hile, on September (), *++:, the petitioner filed a supplemental
petition in the CA,
8(:9
alle'in' that after the commencement of his action, he filed in
the R"C an ur'ent motion for the issuance of a second "RO to en,oin the holdin'
of an A3P membership meetin' and the election of a ne2 #oard of "rustees,
capitaliDin' on the admission in the respondents? ans2er that he had been elected
in *++( to a fi-e-.ear term of office. Ce ar'ued that the admission estopped the
respondents from insistin' to the contrar..

"he respondents filed in the CA a -erified ur'ent motion for a "RO and to
set a hearin' on the application for preliminar. in,unction to en,oin the R"C from
implementin' the assailed order 'rantin' a 2rit of preliminar. in,unction and from
further proceedin' in the case. "he petitioner opposed the motion for "RO, but did
not ob,ect to the schedulin' of preliminar. in,uncti-e hearin's.

On @ebruar. *7, *++7, the CA issued a "RO to en,oin the R"C from
proceedin' for a period of E+ da.s, and declared that the pra.er for in,uncti-e relief
2ould be resol-ed alon' 2ith the merits of the main case.

"he petitioner sou'ht a clarification of the "RO issued b. the CA,
considerin' that his cause of action in his petitions to cite the respondents in
indirect contempt dated March 6, *++7 and March (E, *++7 filed in the R"C
in-ol-ed the election of a certain Robin Saban as the ne2 President of A3P in
blatant and malicious -iolation of the 2rit of preliminar. in,unction issued b. the
R"C. $n clarif.in' the "RO, the CA e0plained that it did not 'o be.ond the reliefs
pra.ed for in the respondents? motion for "RO and preliminar. in,uncti-e
hearin's.

On Au'ust 6, *++7, the CA rendered its decision nullif.in' the R"C?s 2rit
of preliminar. in,unction. $t re,ected the petitioner?s ar'ument that Article $%,
Section : of A3P?s Constitution and #.-La2s and /or1in' Polic. of the
Conference pro-ided a fi-e-.ear term for him, because the pro-ision 2as
ine0istent. $t ruled that the petitioner?s term of office had e0pired on &anuar. **,
*++:, or t2o .ears from his appointment, based on A3P?s amended #.-La2sA that,
conse=uentl., he had been a mere de facto officer appointed b. the members of the
#oard of "rusteesA and that he held no le'al ri'ht 2arrantin' the issuance of the
2rit of preliminar. in,unction.

"he CA declared that the rule on ,udicial admissions admitted of e0ceptions,
as held in National Poer Corporation v. Court of Appeals,
8(79
2here the Court held
that admissions 2ere not e-idence that pre-ailed o-er documentar. proofA that the
petitioner?s bein' able to ans2er the results of the special audit point-b.-point
belied his alle'ation of denial of due processA that A3P 2as the part. that stood to
be in,ured b. the issuance of the in,uncti-e 2rit in the form of a FdemoraliDed
administration, studentr., facult. and staff, sullied reputation, and dishonest
leadershipAG and that the assailed R"C order so2ed confusion and chaos because
the R"C thereb. chose to subordinate the interest of the entire A3P communit. to
that of the petitioner 2ho had been deemed not to ha-e satisfied the hi'hest ideals
re=uired of his office.

I$$*!$

3ndeterred, the petitioner has appealed, contendin' that:

$.
"C CO3R" O@ APPPALS CAS !C$!! CON"RARH "O LA/
AN! &3R$SPR3!NC /CN $" R3L! "CA" "C
I"RAOR!$NARH /R$" O@ CR"$ORAR$ APPL$! $N "C
CAS A" #AR.

$$.
"C CO3R" O@ APPALS !C$!! A <3S"$ON O@
S3#S"ANC $N A /AH NO" $N ACCOR! /$"C "C
S"A#L$SC! LA/ AN! &3R$SPR3!NC "CA"
FA!M$SS$ONS, %R#AL OR /R$""N, MA! #H A PAR"H $N
"C CO3RS O@ "C PROC!$N>S $N "C SAM CAS,
!OS NO" R<3$R PROO@,G #H R<3$R$N> P"$"$ONR
#ARAH3>A "O PRSN" %$!NC "CA" C$S "RM AS
PRS$!N" O@ A3P $S @OR @$% 465 HARS.


$$$.
"C CO3R" O@ APPALS !C$!! A <3S"$ON
O@ S3#S"ANC $N A /AH NO" $N ACCOR! /$"C LA/ AN!
S"A#L$SC! @AC"S /CN $" R3L! "CA" P"$"$ONR
#ARAH3>A CAS ONLH A "RM O@ "/O 4*5 HARS $NS"A!
O@ @$% 465 HARS AS CLARLH A!M$""! #H PR$%A"
RSPON!N" A3P $N $"S ANS/R.

$%.
"C CO3R" O@ APPALS !C$!! A <3S"$ON
O@ S3#S"ANC $N A /AH NO" $N ACCOR! /$"C LA/ AN!
&3R$SPR3!NC #H SOLLH RLH$N> ON "C CAS
O@ NA!"#NA$ P#%&' C#'P#'A!"#N v. C#('! #) APP&A$*,
/C$CC $N%OL% @AC"S !$@@RN" @ROM "C PRSN"
CAS.

%.
"C CO3R" O@ APPALS !C$!! A <3S"$ON
O@ S3#S"ANC $N A /AH NO" $N ACCOR! /$"C LA/ AN!
S"A#L$SC! @AC"S /CN $" 3N&3S"$@$A#LH ALLO/!
"C /A$%R O@ NO"$C @OR "C SPC$AL M"$N> O@ "C
#OAR! O@ "R3S"S.

%$.
"C CO3R" O@ APPALS !C$!! A <3S"$ON O@
S3#S"ANC $N A /AH NO" $N ACCOR! /$"C LA/ AN!
S"A#L$SC! @AC"S /CN $" RRONO3SLH CONCL3!!
"CA" P"$"$ONR #ARAH3>A /AS MRLH OCC3PH$N>
"C POS$"$ON O@ A3P PRS$!N" $N A COL!-O%R
CAPAC$"H.


"he petitioner ar'ues that the assailed R"C order, bein' supported b.
substantial e-idence, accorded 2ith la2 and ,urisprudenceA that his tenure as
President under the Constitution, #.-La2s and the /or1in' Polic. of the
Conference 2as for fi-e .ears, contrar. to the CA?s findin's that he held the
position in a hold-o-er capacit.A that instead, the CA should ha-e applied the rule
on ,udicial admission, because the holdin' in National Poer Corporation v.
Court of Appeals, cited b. the CA, did not appl., due to A3P not ha-in' presented
competent e-idence to pro-e that he had not been elected b. the #oard of "rustees
as President of A3PA and that his remo-al durin' the special board meetin' that
2as in-alidl. held for lac1 of notice denied him due process.



A3P counters that:

$
P"$"$ONR $S NO" AN LC"! "R3S" O@ "C A3P
#OAR!, NOR /AS 4C5 LC"! AS PRS$!N", AN! AS
S3CC, C CAN CLA$M NO R$>C" "O "C A3P PRS$!NCH,
#$N> "/$C !$S<3AL$@$! #H LA/, /C$CC RN!RS
MOO" AN! ACAM!$C ALL O@ "C AR>3MN"S $N "C$S
P"$"$ON.

$$
%N $@ / @ALSLH ASS3M &+ ,'A!"A "CA" P"$"$ONR
$S AN LC"! "R3S" AN! LC"! PRS$!N", "C
"/O 4*5 HAR "RM PRO%$!! $N A3P?S #H-LA/S J
R<3$R! #H "C CORPORA"$ON CO! AN! APPRO%! #H
"C SC J $S /CA" >O%RNS "C $N"RA-CORPORA"
CON"RO%RSH, "C A3P?S A!M$SS$ON $N $"S ANS/R "CA"
C CAS A @$% 465 HAR "RM #AS! ON C$S $N%OK!
SAMPL CONS"$"3"$ON, #H-LA/S AN! POL$CH O@ "C
S%N"C !AH A!%N"$S" NO"/$"CS"AN!$N>.

$$$
P3RS3AN" "O "C R3LS AN! S""L! &3R$SPR3!NC,
"C A!M$SS$ON $N "C ANS/R $S NO" %N PR&3!$C$AL
A" ALL.

$%
%N $@ / @ALSLH ASS3M, &3S" @OR "C SAK O@
AR>3MN", "CA" "C P"$"$ONR CA! A @$% 465 HAR
"RM AS 3N$%RS$"H PRS$!N", C /AS NON"CLSS
%AL$!LH "RM$NA"! @OR LOSS O@ CON@$!NC, >$%N
"C N3MRO3S A!M$""! ANOMAL$S C COMM$""!.

%
P"$"$ONR CANNO" COMPLA$N "CA" NO"$CS O@ "C
#OAR! M"$N> /R NO" SN" "O ALL F"C "/N"H
@$% 4*65 "R3S"S O@ "C A3P #OAR!G, S$NC: 8(9 AS "C
A3P SCR"ARH, $" /AS C /CO CA! "C !3"H "O SN!
"C NO"$CSA 8*9 /ORS, C A""N!! AN!
ICA3S"$%LH !@N!! C$S /R$""N ANS/R $N "C
A3P #OAR! O@ "R3S"S M"$N>, "C3S, /A$%$N> ANH
FNO"$C O#&C"$ONGA 8:9 /ORS" O@ ALL, C$S
A@"R"CO3>C" O#&C"$ON $S !CP"$%LH @ALS $N
@AC".


"he decisi-e =uestion is 2hether the CA correctl. ruled that the petitioner
had no le'al ri'ht to the position of President of A3P that could be protected b.
the in,uncti-e 2rit issued b. the R"C.


R*+(n)

/e den. the petition for re-ie2 for lac1 of merit.

1.
P!((on ($ ,+%!,#- .oo

"he in,uncti-e 2rit issued b. the R"C 2as meant to protect the petitioner?s
ri'ht to sta. in office as President. >i-en that the lifetime of the 2rit of preliminar.
in,unction 2as co-extensive 2ith the duration of the act sou'ht to be prohibited,
8(69
this in,uncti-e relief alread. became moot in the face of the admission b. the
petitioner himself, throu'h his affida-it,
8(E9
that his term of office premised on his
alle'ed fi-e-.ear tenure as President had lasted onl. until !ecember *++6. $n short,
the in,uncti-e 2rit 'ranted b. the R"C had e0pired upon the end of the term of
office 4as posited b. him5.

"he mootness of the petition 2arranted its denial. /hen the resolution of the
issue submitted in a case has become moot and academic, and the pra.er of the
complaint or petition, e-en if 'ranted, has become impossible of enforcement J for
there is nothin' more to en,oin J the case should be dismissed.
8()9
No useful
purpose 2ould then be ser-ed b. passin' on the merits of the petition, because an.
rulin' could hardl. be of an. practical or useful purpose in the premises. $t is a
settled rule that a court 2ill not determine a moot =uestion or an abstract
proposition, nor e0press an opinion in a case in 2hich no practical relief can be
'ranted.
8(B9
$ndeed, moot and academic cases cease to present an. ,usticiable
contro-ersies b. -irtue of super-enin' e-ents,
8(;9
and the courts of la2 2ill not
determine moot =uestions,
8*+9
for the courts should not en'a'e in academic
declarations and determine a moot =uestion.
8*(9

/.
RTC ,"!# (n 0,!n+- )%,1! ,2*$! o& #($"%!(on
(n ($$*(n) '! TRO ,n# 3%( o& (n4*n"(on

Nonetheless, the aspect of the case concernin' the petitioner?s claim for
dama'es has still to be decided. $t is for this reason that 2e ha-e to resol-e 2hether
or not the petitioner had a ri'ht to the "RO and the in,uncti-e 2rit issued b. the
R"C.

A -alid 2rit of preliminar. in,unction rests on the 2ei'ht of e-idence
submitted b. the plaintiff establishin': 4a5 a present and unmista1able ri'ht to be
protectedA 4b5 the acts a'ainst 2hich the in,unction is directed -iolate such ri'htA
and 4c5 a special and paramount necessit. for the 2rit to pre-ent serious dama'es.
8**9
$n the absence of a clear le'al ri'ht, the issuance of the in,uncti-e 2rit
constitutes 'ra-e abuse of discretion
8*:9
and 2ill result to nullification
thereof. /here the complainant?s ri'ht is doubtful or disputed, in,unction is not
proper. "he possibilit. of irreparable dama'e sans proof of an actual e0istin' ri'ht
is not a 'round for a preliminar. in,unction.
8*79

$t is clear to us, based on the fore'oin' principles 'uidin' the issuance of the
"RO and the 2rit of in,unction, that the issuance of the assailed order constituted
patentl. 'ra-e abuse of discretion on the part of the R"C, and that the CA ri'htl.
set aside the order of the R"C.

"o be'in 2ith, the petitioner rested his claim for in,unction mainl. upon his
representation that he 2as entitled to ser-e for fi-e .ears as President of A3P
under the Constitution, #.-La2s and /or1in' Polic. of the >eneral Conference of
the Se-enth !a. Ad-entists 4other2ise called the -luebook5. All that he presented
in that re'ard, ho2e-er, 2ere mere photocopies of pa'es **6-**E of the -luebook,
2hich read:

Article $%-#oard of !irectors

Sec. (. "his school operated b. the LLLLLLLLLLLLL 3nion
ConferenceMMission of Se-enth-!a. Ad-entists shall be under the direct
control of a board of directors, elected b. the constituenc. in its
=uin=uennial sessions. "he board of directors shall consist of (6 to *(
members, dependin' on the siDe of the institution. &x officio members
shall be the union president as chairperson, the head of the school as
secretar., the union secretar., the union treasurer, the union director of
education, the presidents of the conferencesMmissions 2ithin the union.
000.

Sec. *. "he term of office of members of the board of directors
shall be fi-e .ears to coincide 2ith the LLLLLLLLLLLLLL 3nion
ConferenceMMission =uin=uennial period.

Sec. :. "he duties of the board of directors shall be to elect
=uin=ueniall. the president, 000.

Het, the document had no e-identiar. -alue. $t had not been officiall.
adopted for submission to and appro-al of the Securities and 0chan'e
Commission. $t 2as nothin' but an unfilled model form. As such, it 2as, at best,
onl. a pri-ate document that could not be admitted as e-idence in ,udicial
proceedin's until it 2as first properl. authenticated in court.

Section *+, Rule (:* of the 'ules of Court re=uires authentication as a
condition for the admissibilit. of a pri-ate document, to 2it:

Section *+. Proof of private document. J #efore an. pri-ate
document offered as authentic is recei-ed in e-idence, its due e0ecution
and authenticit. must be pro-ed either:

4a5 #. an.one 2ho sa2 the document e0ecuted or 2rittenA or

4b5 #. e-idence of the 'enuineness of the si'nature or hand2ritin'
of the ma1er.

An. other pri-ate document need onl. be identified as that 2hich it
is claimed to be. 4*( a5

@or the R"C to base its issuance of the 2rit of preliminar. in,unction on the
mere photocopies of the document, especiall. that such document 2as desi'ned to
pla. a crucial part in the resolution of the decisi-e issue on the len'th of the term
of office of the petitioner, 2as 'ross error.

Secondl., e-en assumin' that the petitioner had properl. authenticated the
photocopies of the -luebook, the pro-isions contained therein did not -est the ri'ht
to an office in him. An unfilled model form creates or establishes no ri'hts in fa-or
of an.one.

"hirdl., the petitioner?s assertion of a fi-e-.ear duration for his term of
office lac1ed le'al basis.

Section (+B of the Corporation Code determines the membership and
number of trustees in an educational corporation, vi.:

Section (+B. -oard of trustees. J "rustees of educational
institutions or'aniDed as educational corporations shall not be less than
fi-e 465 nor more than fifteen 4(65: Pro-ided, ho2e-er, "hat the number
of trustees shall be in multiples of fi-e 465.

3nless other2ise pro-ided in the articles of incorporation or the b.-
la2s, the board of trustees of incorporated schools, colle'es, or other
institutions of learnin' shall, as soon as or'aniDed, so classif. themsel-es
that the term of office of one-fifth 4(M65 of their number shall e0pire
e-er. .ear. T%*$!!$ '!%!,&!% !+!"!# o &(++ 1,",n"(!$, o""*%%(n)
2!&o%! '! !50(%,(on o& , 0,%("*+,% !%., $',++ 'o+# o&&("! on+- &o%
'! *n!50(%!# 0!%(o#. T%*$!!$ !+!"!# '!%!,&!% o &(++ 1,",n"(!$
",*$!# 2- !50(%,(on o& !%. $',++ 'o+# o&&("! &o% &(1! 678 -!,%$. A
ma,orit. of the trustees shall constitute a =uorum for the transaction of
business. "he po2ers and authorit. of trustees shall be defined in the b.-
la2s.

@or institutions or'aniDed as stoc1 corporations, the number and
term of directors shall be 'o-erned b. the pro-isions on stoc1
corporations.

"he second para'raph of the pro-ision, althou'h settin' the term of the
members of the #oard of "rustees at fi-e .ears, contains a pro-iso e0pressl.
sub,ectin' the duration to 2hat is otherise provided in the articles of
incorporation or b.-la2s of the educational corporation. "hat contrar. pro-ision
controls on the term of office.
8*69

$n A3P?s case, its amended #.-La2s pro-ided the term of the members of
the #oard of "rustees, and the period 2ithin 2hich to elect the officers, thusl.:

Article $

#oard of "rustees

Section (. At the first meetin' of the members of the corporation,
and thereafter e-er. t2o .ears, a #oard of "rustees shall be elected. $t
shall be composed of fifteen members in 'ood and re'ular standin' in
the Se-enth-da. Ad-entist denomination, !,"' o& 3'o. $',++ 'o+# '($
o&&("! &o% , !%. o& 3o -!,%$, o% *n(+ '($ $*""!$$o% ',$ 2!!n !+!"!#
,n# 9*,+(&(!#. $f a trustee ceases at an. time to be a member in 'ood and
re'ular standin' in the Se-enth-da. Ad-entist denomination, he shall
thereb. cease to be a trustee.
0000

Article $%

Officers

Section (. &lection of officers. J At their o%),n(:,(on .!!(n), the
members of the #oard of "rustees shall elect &%o. ,.on) '!.$!+1!$ a
Chairman, a %ice-Chairman, a President, a Secretar., a #usiness
Mana'er, and a "reasurer. "he same persons ma. hold and perform the
duties of more than one office, pro-ided the. are not incompatible 2ith
each other.
8*E9


$n li'ht of fore'oin', the members of the #oard of "rustees 2ere to ser-e a
term of office of onl. t2o .earsA and the officers, 2ho included the President, 2ere
to be elected from amon' the members of the #oard of "rustees durin' their
or'aniDational meetin', 2hich 2as held durin' the election of the #oard of
"rustees every to years. Naturall., the officers, includin' the President, 2ere to
e0ercise the po2ers -ested b. Section * of the amended #.-La2s for a term of
onl. t2o .ears, not fi-e .ears.

$neluctabl., the petitioner, ha-in' assumed as President of A3P on &anuar.
*:, *++(, could ser-e for onl. t2o .ears, or until &anuar. **, *++:. #. the time of
his remo-al for cause as President on &anuar. *), *++:, he 2as alread. occup.in'
the office in a hold-o-er capacit., and could be remo-ed at any time, ithout
cause, upon the election or appointment of his successor. Cis insistence on holdin'
on to the office 2as untenable, therefore, and 2ith more reason 2hen one considers
that his remo-al 2as due to the loss of confidence on the part of the #oard of
"rustees.

;.
P!((on!% 3,$ no #!n(!# #*! 0%o"!$$

"he petitioner complains that he 2as denied due process because he 2as
depri-ed of the ri'ht to be heard and to see1 reconsiderationA and that the
proceedin's of the #oard of "rustees 2ere ille'al due to its members not bein'
properl. notified of the meetin'.

Still, the petitioner fails to con-ince us.

"he re=uirements of due process in an administrati-e conte0t are satisfied
2hen the parties are afforded fair and reasonable opportunit. to e0plain their
respecti-e sides of the contro-ers.,
8*)9
for the essence of due process is an
opportunit. to be heard.
8*B9
Cere, the petitioner 2as accorded the full opportunit. to
be heard, as borne b. the fact that he 2as 'ranted the
opportunit. to refute the ad-erse findin's contained in the >CAS audit report
and that the #oard of "rustees first heard his side durin' the board meetin's before
his remo-al. After ha-in' -oluntaril. offered his refutations in the proceedin's
before the #oard of "rustees, he should not no2 be permitted to denounce the
proceedin's and to plead the denial of due process after the decision of the #oard
of "rustees 2as ad-erse to him.

Nor can his ur'in' that the proceedin's 2ere ille'al for lac1 of prior
notification be plausible in li'ht of the fact that he 2illin'l. participated therein
2ithout raisin' the ob,ection of lac1 of notification. "hereb., he effecti-el. 2ai-ed
his ri'ht to ob,ect to the -alidit. of the proceedin's based on lac1 of due notice.
8*;9

7.
Con"+*$(on

"he remo-al of the petitioner as President of A3P, bein' made in
accordance 2ith the A3P Amended #.-La2s, 2as -alid. /ith that, our 'oin' into
the other issues becomes unnecessar.. /e conclude that the order of the R"C
'rantin' his application for the 2rit of preliminar. in,unction 2as tainted 2ith
manifestl. 'ra-e abuse of discretionA that the CA correctl. nullified and set aside
the orderA and that his claim for dama'es, bein' bereft of factual and le'al 2arrant,
should be dismissed.

<HEREFORE, 2e DENY the petition for re-ie2 on certiorari for lac1 of
merit, and hereb. DISMISS SC Case No. +*B-+: entitled /r. Petronilo
-arayu0a v. Nelson /. /ayson, et al.


"he petitioner shall pa. the cost of suit.

SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-48754 November 26, 1941
EMILIO . RE!ES, protestant-appellant,
vs.
"POLONIO R. #I"$, protestee-appellee.
MOR"N, J.:
This case is certified to this Court by the Court of Appeals upon
the round that the !urisdiction of the trial court is in issue. The
supposed "uestions of !urisdiction are, first, #hether or not
there is sufficient to sho# that the protestant has duly filed his
certificate of candidacy, and second, #hether the trial court has
or has no authority to pass upon the validity of the ballots
ad!udicated to the protestant #hich have not been challened
by the protestee in his counter-protest.
Article $%%%, section &, No. ', of the Constitution confers upon
the (upre)e Court !urisdiction over *all cases in #hich the
!urisdiction of any trial court is in issue.* (ection +',, No. ', of
the Revised Ad)inistrative Code as a)ended by
Co))on#ealth Acts Nos. ' and &-., provides that the
(upre)e Court shall have appellate !urisdiction over *all cases
in #hich the !urisdiction of any inferior court is in issue.* %t has
been held that the #ord *!urisdiction* as used in the
constitutions and in the statutes *)eans !urisdiction as to the
sub!ect-)atter only, unless an e/ception arises by reason of its
e)ploy)ent in a broader sense.* 0+- C. 1. 2'-3
1ohnson vs. 4ells, .+ 5ed. +3 6. (. vs. 7ee, ,8 5ed. 9&93
$inal vs. Continental Constr., etc. Co., '8 5ed. &&,3
(tarnes vs. Mutual 7oan etc., Co., +:& ;a. -.23 &. (E 8-&.<
There is in our Constitution or in the la# aforecited nothin
#hich )ay lend the #ord *!urisdiction* therein used a broader
)eanin than !urisdiction over the sub!ect )atter. =n the
contrary, havin due reard to the )anifest purpose of the la#,
#hich is to confine the appellate !urisdiction of this court to
cases of vital i)portance involvin "uestions of funda)ental
character, such, for instance, as the "uestion of validity of
statute, treaty or ordinance, or the leality of any ta/, i)port or
assess)ent #hich )ay effect the very e/istence of the
overn)ent, or cri)inal cases #herein life i)prison)ent or
death penalty is i)posed, #e are of the opinion and so hold,
that the issue of !urisdiction #hich confers appellate po#ers
upon this Court in a iven case is not such "uestion as is
dependent e/clusively upon )inor )atters of fact or upon a
)ere construction of the pleadins, but that #hich has
reference to the )ore i)portant "uestion of !urisdiction of the
trial court over the sub!ect-)atter as deter)ined by la#.
1urisdiction over the sub!ect-)atter is the po#er to hear and
deter)ine cases of the eneral class to #hich the proceedins
in "uestion belon 0C. 1. (., p. '9< and is conferred by the
soverein authority #hich orani>es the court and defines its
po#ers 0Banco Espa?ol 5ilipino vs. Palanca, '2 Phil. .&+3
Per@ins vs. Ai>on, 8: =ff. ;a>. No. 2, 'd (up. p. &+93 N (i
Cho@ vs. $era, ;.R. No. 8-928<. The "uestion, therefore, of
#hether a court has !urisdiction over the sub!ect-)atter, calls for
interpretation and application of the la# of !urisdiction #hich
distributes the !udicial po#er a)on the different courts in the
Philippines, and since the rulin on the )atter is of far-reachin
conse"uences, affectin, as it )ay, the very life and structure of
our !udicial syste), the la# has dee)ed it #ise to place the
po#er and authority to act thereon in the hihest court of the
land.
%n the instant, case, there is no such "uestion of !urisdiction as
above described. Both parties aree that if the due filin of the
protestantBs certificate of candidacy is proven, the trial court has
no !urisdiction e/cept to dis)iss the case. There is, therefore,
no "uestion bet#een the parties as to #hat the !urisdiction of
the trial court is accordin to la# in either case. The real
"uestion bet#een the) is one of fact C #hether or not the
protestantBs certificate of candidacy has been duly filed. And not
the until this fact is proved can the "uestion of !urisdiction be
deter)ined.
Neither is the second "uestion one of !urisdiction #ithin the
purvie# of the leal provisions above "uoted. 4hether certain
ballots are or are not pertinent to the issue raised in the
pleadins, is )erely a "uestion of relevancy of evidence. %t )ay
be true that the court by an erroneous rulin on such "uestion
)y encroach upon issues co)pletely forein to those defined in
the pleadins, but in such case the "uestion of !urisdiction that
)ay arise #ould not be one of !urisdiction over the sub!ect-
)atter but of !urisdiction over the issue. %n order that a court
)ay validly try and decide a case, it )ust have !urisdiction over
the persons of the parties. 0Banco Espa?ol 5ilipino vs.Palanca,
'2 Phil. .&+3 Per@ins vs. Ai>on, 8: =ff. ;a>. No. 2, 'd (up. p.
&+9.< But in so)e instances it is said that the court should also
have !urisdiction over the issue 0+- C. 1. 2'83 Dutts vs. Martin,
+'8 %nd. -,2, '' N. E. 929<, )eanin thereby that the issue
bein tried and decided by the court be #ithin the issues raised
in the pleadins. But this @ind of !urisdiction should be
distinuished fro) !urisdiction over the sub!ect-)atter the latter
bein conferred by la# and the for)er by the pleadins.
1urisdiction over the issue, unli@e !urisdiction over the sub!ect-
)atter, )ay be conferred by consent either e/press or i)plied
of the parties. 0Rule +2, sec. 8, Rules of Court.< Althouh an
issue is not duly pleaded it )ay validly be tried and decided if
no ti)ely ob!ection is )ade thereto by the parties. This cannot
be done #hen !urisdiction over the sub!ect-)atter is involved. %n
truth, !urisdiction over the issue is an e/pression of a principle
that is involved in !urisdiction over the persons of the parties.
4here, for instance, an issue is not duly pleaded in the
co)plaint, the defendant cannot be said to have been served
#ith process as to that issue. 0Cf. At@ins etc. Co. vs. Ao)ino,
88 Phil. 9,:<. At any rate, #hether or not the court has
!urisdiction over a specific issue is a "uestion that re"uires
nothin e/cept an e/a)ination of the pleadins, and this
function is #ithout such i)portance as call for the intervention of
this Court.
5urther)ore, this "uestion of !urisdiction is unsubstantial. %t is
#ell-settled rule that the institution of suffrae is of public, not
private, interest, and the court )ay e/a)ine all the ballots after
the ballot bo/es are opened in order to deter)ine #hich are
leal and #hich are illeal, even thouh neither of the parties
raised any "uestion as to their illeality. 0Ealun vs. Atien>a, -&
Phil. 2,+3 Cecilio vs. To)acru>, 9& Phil. 9,.3
Cosculluela vs. ;aston, 9' Phil. 8+<.
4herefore, this case is hereby re)anded to the Court of
Appeals for further proceedins.
SECOND DIVISION

MA. "RSA CCA%S #$ACO, >.R. No. (E(7()
Petitioner,
Present:

<3$S3M#$N>, J.,
Chairperson,
- -ersus - CARP$O,
CARP$O MORALS,
"$N>A, and
%LASCO, &R., JJ.
PC$L$PP$N CO3N"RHS$! R3RAL
#ANK,
Respondent. Promul'ated:

@ebruar. B, *++)

0----------------------------------------------------------------------------0


D E C I S I O N

"$N>A, J.:


Petitioner, Ma. "eresa Cha-es #iaco, see1s a re-ie2 of the !ecision
8(9
of the
Court of Appeals in CA->.R. No. E)7B; dated Au'ust *), *++:, 2hich denied her
petition for annulment of ,ud'ment, and the Resolution
8*9
dated !ecember (6,
*++: 2hich denied her motion for reconsideration.

"he facts as succinctl. stated b. the Court of Appeals are as follo2s:

rnesto #iaco is the husband of petitioner Ma. "eresa Cha-es
#iaco. /hile emplo.ed in the Philippine Countr.side Rural #an1
4PCR#5 as branch mana'er, rnesto obtained se-eral loans from the
respondent ban1 as e-idenced b. the follo2in' promissor. notes:

@eb. (), (;;B P E6,+++.++
Mar. (B, (;;B :+,+++.++
Ma. E, (;;B E+,+++.++
Ma. *+, (;;B :6+,+++.++
&ul. :+, (;;B (66,+++.++
Sept. B, (;;B 7+,+++.++
Sept. B, (;;B (*+,+++.++

As securit. for the pa.ment of the said loans, rnesto e0ecuted a
real estate mort'a'e in fa-or of the ban1 co-erin' the parcel of land
described in Ori'inal Certificate of "itle 4OC"5 No. P-(77*:. "he real
estate mort'a'es bore the si'natures of the spouses #iaco.

/hen rnesto failed to settle the abo-e-mentioned loans on its
due date, respondent ban1 throu'h counsel sent him a 2ritten demand
on September *B, (;;;. "he amount due as ofSeptember :+, (;;; had
alread. reached ON M$LL$ON $>C"H "CO3SAN! S$I
C3N!R! S%N"H S$I AN! @$@"H CN"A%OS
4P(,+B+,E)E.6+5.

"he 2ritten demand, ho2e-er, pro-ed futile.

On @ebruar. **, *+++, respondent ban1 filed a complaint for
foreclosure of mort'a'e a'ainst the spouses rnesto and "eresa #iaco
before the R"C of Misamis Oriental. Summons 2as ser-ed to the
spouses #iaco throu'h rnesto at his office 40port and $ndustr. #an15
located at &ofelmor #ld'., Mortola Street, Ca'a.an de Oro Cit..

rnesto recei-ed the summons but for un1no2n reasons, he failed
to file an ans2er. Cence, the spouses #iaco 2ere declared in default
upon motion of the respondent ban1. "he respondent ban1 2as allo2ed
to present its e-idence ex parte before the #ranch Cler1 of Court 2ho
2as then appointed b. the court as Commissioner.





Arturo "orin', the branch mana'er of the respondent ban1,
testified that the spouses #iaco had been obtainin' loans from the ban1
since (;;E to (;;B. "he loans for the .ears (;;E-(;;) had alread. been
paid b. the spouses #iaco, lea-in' behind a balance of P(,*E+,:+7.::
representin' the (;;B loans. "he amount bein' claimed is inclusi-e of
interests, penalties and ser-ice char'es as a'reed upon b. the parties.
"he appraisal -alue of the land sub,ect of the mort'a'e is
onl. P(6+,+++.++ as reported b. the Assessor?s Office.

#ased on the report of the Commissioner, the respondent ,ud'e
ordered as follo2s:

/CR@OR, ,ud'ment is hereb. rendered orderin'
defendants spouses RNS"O R. #$ACO and MA. "CRSA
8CCA%S9 #$ACO to pa. plaintiff ban1 2ithin a period of not
less than ninet. 4;+5 da.s nor more than one hundred 4(++5 da.s
from receipt of this decision the loan of ON M$LL$ON "/O
C3N!R! S$I"H "CO3SAN! "CR C3N!R! @O3R
PSOS and "C$R"H "CR CN"A%OS 4P(,*E+,:+7.::5 plus
liti'ation e0penses in the amount of S%N "CO3SAN! S$I
C3N!R! @OR"H PSOS 4P),E7+.++5 and attorne.?s fees in
the amount of "/O C3N!R! @$@"H "/O "CO3SAN!
"C$R"H PSOS and @OR"H "CR CN"A%OS
4P*6*,+:+.7:5 and cost of this suit.

$n case of non-pa.ment 2ithin the period, the Sheriff of
this Court is ordered to sell at public auction the mort'a'ed Lot, a
parcel of re'istered land 4Lot :6B+*, Cad. *:) NLot No. (*:BB-#,
Csd-(+-++*:7*-!O5, located at >asi, La'uindin'an, Misamis
Oriental and co-ered b. "C" No. P-(77*: to satisf. the mort'a'e
debt, and the surplus if there be an. should be deli-ered to the
defendants spouses RNS"O and MA. "CRSA 8CCA%S9
#$ACO. $n the e-ent ho2e-er8,9 that the proceeds of the auction
sale of the mort'a'e8d9 propert. is not enou'h to pa. the
outstandin' obli'ation, the defendants are ordered to pa. an.
deficienc. of the ,ud'ment as their personal liabilit..

SO OR!R!.

On &ul. (*, *+++, the sheriff personall. ser-ed the abo-e-
mentioned ,ud'ment to rnesto #iaco at his office at 0port and
$ndustr. #an1. "he spouses #iaco did not appeal from the ad-erse
decision of the trial court. On October (:, *+++, the respondent ban1
filed an ex parte motion for e0ecution to direct the sheriff to sell the
mort'a'ed lot at public auction. "he respondent ban1 alle'ed that the
order of the court re=uirin' the spouses #iaco to pa. 2ithin a period of
;+ da.s had passed, thus ma1in' it necessar. to sell the mort'a'ed lot at
public auction, as pre-iousl. mentioned in the order of the court. "he
motion for e0ecution 2as 'ranted b. the trial court per Order
dated October *+, *+++.

On October :(, *+++, the sheriff ser-ed a cop. of the 2rit of
e0ecution to the spouses #iaco at their residence in P;*
;
th
Street, NaDareth, Ca'a.an de Oro Cit.. "he 2rit of e0ecution 2as
personall. recei-ed b. rnesto. #. -irtue of the 2rit of e0ecution issued
b. the trial court, the mort'a'ed propert. 2as sold at public auction in
fa-or of the respondent ban1 in the amount of ON C3N!R! @$@"H
"CO3SAN! PSOS 4P(6+,+++.++5.

"he amount of the propert. sold at public auction bein'
insufficient to co-er the full amount of the obli'ation, the respondent
ban1 filed an Fex parte motion for ,ud'mentG pra.in' for the issuance of
a 2rit of e0ecution a'ainst the other properties of the spouses #iaco for
the full settlement of the remainin' obli'ation. >rantin' the motion, the
court ordered that a 2rit of e0ecution be issued a'ainst the spouses #iaco
to enforce and satisf. the ,ud'ment of the court for the balance of ON
M$LL$ON "CR C3N!R! S$I"H N$N "CO3SAN! N$N
C3N!R! S%N"H @O3R PSOS AN! S%N"H CN"A%OS
4P(,:E;,;)7.)+5.

"he sheriff e0ecuted t2o 4*5 notices of le-. a'ainst properties
re'istered under the name of petitioner Ma. "eresa Cha-es #iaco.
Co2e-er, the notices of le-. 2ere denied re'istration because Ma.
"eresa had alread. sold the t2o 4*5 properties to her dau'hters on April
((, *++(.
8:9


Petitioner sou'ht the annulment of the Re'ional "rial Court decision
contendin' that e0trinsic fraud pre-ented her from participatin' in the ,udicial
foreclosure proceedin's. Accordin' to her, she came to 1no2 about the ,ud'ment
in the case onl. after the lapse of more than si0 4E5 months after its finalit.. She
claimed that e0trinsic fraud 2as perpetrated a'ainst her because the ban1 failed to
-erif. the authenticit. of her si'nature on the real estate mort'a'e and did not
in=uire into the reason for the absence of her si'nature on the promissor.
notes. She moreo-er asserted that the trial court failed to ac=uire ,urisdiction
because summons 2ere ser-ed on her throu'h her husband 2ithout an.
e0planation as to 2h. personal ser-ice could not be made.

"he Court of Appeals considered the t2o circumstances that 1ept petitioner
in the dar1 about the ,udicial foreclosure proceedin's: 4(5 the failure of the sheriff
to personall. ser-e summons on petitionerA and 4*5 petitioner?s husband?s
concealment of his 1no2led'e of the foreclosure proceedin's. On the -alidit. of
the ser-ice of summons, the appellate court ruled that ,udicial foreclosure
proceedin's are actions quasi in rem. As such, ,urisdiction o-er the person of the
defendant is not essential as lon' as the court ac=uires ,urisdiction o-er
the res. Notin' that the spouses #iaco 2ere not opposin' parties in the case, the
Court of Appeals further ruled that the fraud committed b. one a'ainst the other
cannot be considered e0trinsic fraud.

Cer motion for reconsideration ha-in' been denied, petitioner filed the
instant Petition for Re-ie2,
879
assertin' that e-en if the action is quasi in
rem, personal ser-ice of summons is essential in order to afford her due
process. "he substituted ser-ice made b. the sheriff at her husband?s office cannot
be deemed proper ser-ice absent an. e0planation that efforts had been made to
personall. ser-e summons upon her but that such efforts failed. Petitioner
contends that e0trinsic fraud 2as perpetrated not so much b. her husband, 2ho did
not inform her of the ,udicial foreclosure proceedin's, but b. the sheriff 2ho
alle'edl. conni-ed 2ith her husband to ,ust lea-e a cop. of the summons intended
for her at the latter?s office.

Petitioner further ar'ues that the deficienc. ,ud'ment is a personal ,ud'ment
2hich should be deemed -oid for lac1 of ,urisdiction o-er her person.

Respondent PCR# filed its Comment,
869
essentiall. reiteratin' the appellate
court?s rulin'. Respondent a-ers that ser-ice of summons upon the defendant is
not necessar. in actions quasi in rem it bein' sufficient that the court ac=uire
,urisdiction o-er the res. As re'ards the alle'ed conspirac. bet2een petitioner?s
husband and the sheriff, respondent counters that this is a ne2 ar'ument 2hich
cannot be raised for the first time in the instant petition.

/e re=uired the parties to file their respecti-e memoranda in the
Resolution
8E9
dated Au'ust (B, *++7. Accordin'l., petitioner filed her
Memorandum
8)9
datedOctober (+, *++7, 2hile respondent filed its Memorandum
for Respondent
8B9
dated September ;, *++7.

Annulment of ,ud'ment is a recourse e=uitable in character, allo2ed onl. in
e0ceptional cases as 2here there is no a-ailable or other ade=uate
remed.. &urisprudence and Sec. *, Rule 7) of the (;;) Rules of Ci-il Procedure
4Rules of Court5 pro-ide that ,ud'ments ma. be annulled onl. on 'rounds of
e0trinsic fraud and lac1 of ,urisdiction or denial of due process.
8;9


Petitioner asserts that e0trinsic fraud consisted in her husband?s concealment
of the loans 2hich he obtained from respondent PCR#A the filin' of the complaint
for ,udicial foreclosure of mort'a'eA ser-ice of summonsA rendition of ,ud'ment b.
defaultA and all other proceedin's 2hich too1 place until the 2rit of 'arnishment
2as ser-ed.
8(+9


0trinsic fraud e0ists 2hen there is a fraudulent act committed b.
the prevailin0 party outside of the trial of the case, 2hereb. the defeated party 2as
pre-ented from presentin' full. his side of the case b. fraud or deception practiced
on him b. the prevailin0 party.
8((9
0trinsic fraud is present 2here the unsuccessful
partyhad been pre-ented from e0hibitin' full. his case, b. fraud or deception
practiced on him b. his opponent, as b. 1eepin' him a2a. from court, a false
promise of a compromiseA or 2here the defendant ne-er had 1no2led'e of the suit,
bein' 1ept in i'norance b. the acts of the plaintiff1 or 2here an attorne.
fraudulentl. or 2ithout authorit. assumes to represent a part. and conni-es at his
defeatA or 2here the attorne. re'ularl. emplo.ed corruptl. sells out his client?s
interest to the other side. "he o-erridin' consideration is that the fraudulent
scheme of the prevailin0 liti0ant pre-ented a part. from ha-in' his da. in court.
8(*9

/ith these considerations, the appellate court acted 2ell in rulin' that there
2as no fraud perpetrated b. respondent ban1 upon petitioner, notin' that the
spouses #iaco 2ere co-defendants in the case and shared the same
interest. /hate-er fact or circumstance concealed b. the husband from the 2ife
cannot be attributed to respondent ban1.

Moreo-er, petitioner?s alle'ation that her si'nature on the promissor. notes
2as for'ed does not e-ince e0trinsic fraud. $t is 2ell-settled that the use of for'ed
instruments durin' trial is not e0trinsic fraud because such e-idence does not
preclude the participation of an. part. in the proceedin's.
8(:9

"he =uestion of 2hether the trial court has ,urisdiction depends on the nature
of the action, i.e., 2hether the action is in personam, in rem, or quasi in rem. "he
rules on ser-ice of summons under Rule (7 of the Rules of Court li1e2ise appl.
accordin' to the nature of the action.

An action in personam is an action a'ainst a person on the basis of his
personal liabilit.. An action in rem is an action a'ainst the thin' itself instead of
a'ainst the person. An action quasi in rem is one 2herein an indi-idual is named as
defendant and the purpose of the proceedin' is to sub,ect his interest therein to the
obli'ation or lien burdenin' the propert..
8(79

$n an action in personam, ,urisdiction o-er the person of the defendant is
necessar. for the court to -alidl. tr. and decide the case. $n a proceedin' in
rem orquasi in rem, ,urisdiction o-er the person of the defendant is not a
prere=uisite to confer ,urisdiction on the court pro-ided that the court ac=uires
,urisdiction o-er theres. &urisdiction o-er the res is ac=uired either 4(5 b. the
seiDure of the propert. under le'al process, 2hereb. it is brou'ht into actual
custod. of the la2A or 4*5 as a result of the institution of le'al proceedin's, in
2hich the po2er of the court is reco'niDed and made effecti-e.
8(69


Nonetheless, summons must be ser-ed upon the defendant not for the
purpose of -estin' the court 2ith ,urisdiction but merel. for satisf.in' the due
process re=uirements.
8(E9


A resident defendant 2ho does not -oluntaril. appear in court, such as
petitioner in this case, must be personall. ser-ed 2ith summons as pro-ided under
Sec. E, Rule (7 of the Rules of Court. $f she cannot be personall. ser-ed 2ith
summons 2ithin a reasonable time, substituted ser-ice ma. be effected 4(5 b.
lea-in' copies of the summons at the defendant?s residence 2ith some person of
suitable a'e and discretion then residin' therein, or 4*5 b. lea-in' the copies at
defendant?s office or re'ular place of business 2ith some competent person in
char'e thereof in accordance 2ith Sec. ), Rule (7 of the Rules of Court.

$n this case, the ,udicial foreclosure proceedin' instituted b. respondent
PCR# undoubtedl. -ested the trial court 2ith ,urisdiction o-er the res. A ,udicial
foreclosure proceedin' is an action quasi in rem. As such, ,urisdiction o-er the
person of petitioner is not re=uired, it bein' sufficient that the trial court is -ested
2ith ,urisdiction o-er the sub,ect matter.

"here is a dimension to this case thou'h that needs to be del-ed
into. Petitioner a-ers that she 2as not personall. ser-ed summons. $nstead,
summons 2as ser-ed to her throu'h her husband at his office 2ithout an.
e0planation as to 2h. the particular surro'ate ser-ice 2as resorted to. "he
Sheriff?s Return of Ser-ice dated March *(, *+++ states:
0 0 0 0

"hat on March (E, *+++, the undersi'ned ser-ed the copies of
Summons, complaint and its anne0es to the defendants Sps. rnesto R.
Q Ma. "eresa Ch. #iaco '%* E%n!$o R.B(,"o=,> #!&!n#,n of the
abo-e-entitled case , '($ o&&("! IPOR" Q $N!3S"RH
#ANK, &ofelmore #ld'.8,9 Mortola St., Ca'a.an de Oro Cit. and he
ac1no2led'ed receipt thereof as e-idenced 2ith his si'nature appearin'
on the ori'inal cop. of the Summons.
8()9
8mphasis supplied9

/ithout rulin' on petitioner?s alle'ation that her husband and the sheriff
conni-ed to pre-ent summons from bein' ser-ed upon her personall., 2e can see
that petitioner 2as denied due process and 2as not able to participate in the
,udicial foreclosure proceedin's as a conse=uence. "he -iolation of petitioner?s
constitutional ri'ht to due process arisin' from 2ant of -alid ser-ice of summons
on her 2arrants the annulment of the ,ud'ment of the trial court.

"here is more, the trial court 'ranted respondent PCR#?s ex-parte motion
for deficienc. ,ud'ment and ordered the issuance of a 2rit of e0ecution a'ainst the
spouses #iaco to satisf. the remainin' balance of the a2ard. $n short, the trial
court 2ent be.ond its ,urisdiction o-er the res and rendered a personal ,ud'ment
a'ainst the spouses #iaco. "his cannot be countenanced.

$n *aha0un v. Court of Appeals,
8(B9
suit 2as brou'ht a'ainst a non-resident
defendant, Abelardo Saha'un, and a 2rit of attachment 2as issued and
subse=uentl. le-ied on a house and lot re'istered in his name. Claimin' o2nership
of the house, his 2ife, Carmelita Saha'un, filed a motion to inter-ene. @or failure
of plaintiff to ser-e summons e0traterritoriall. upon Abelardo, the complaint 2as
dismissed 2ithout pre,udice.

Subse=uentl., plaintiff filed a motion for lea-e to ser-e summons b.
publication upon Abelardo. "he trial court 'ranted the motion. Plaintiff later filed
an amended complaint a'ainst Abelardo, this time impleadin' Carmelita
and Rall.e as additional defendants. Summons 2as ser-ed on Abelardo throu'h
publication in the2anila &venin0 Post. Abelardo failed to file an ans2er and 2as
declared in default. Carmelita 2ent on certiorari to the Court of Appeals assailin'
as 'ra-e abuse of discretion the declaration of default of Abelardo. "he Court of
Appeals dismissed the petition and denied reconsideration.

$n her petition 2ith this Court, Carmelita raised the issue of 2hether the trial
court ac=uired ,urisdiction o-er her husband, a non-resident defendant, b. the
publication of summons in a ne2spaper of 'eneral circulation in
the Philippines. "he Court sustained the correctness of e0tra,udicial ser-ice of
summons b. publication in such ne2spaper.

"he Court e0plained, citin' &l -anco &spa3ol-)ilipino v. Palanca,
8(;9
that
foreclosure and attachment proceedin's are both actions quasi in rem. As such,
,urisdiction o-er the person of the 4non-resident5 defendant is not
essential. Ser-ice of summons on a non-resident defendant 2ho is not found in the
countr. is re=uired, not for purposes of ph.sicall. ac=uirin' ,urisdiction o-er his
person but simpl. in pursuance of the re=uirements of fair pla., so that he ma. be
informed of the pendenc. of the action a'ainst him and the possibilit. that propert.
belon'in' to him or in 2hich he has an interest ma. be sub,ected to a ,ud'ment in
fa-or of a resident, and that he ma. thereb. be accorded an opportunit. to defend
in the action, should he be so minded.

Si'nificantl., the Court 2ent on to rule, citin' /e 2id0ely v. )erandos, et.
al.
8*+9
and Perkins v. /i.on, et al.
8*(9
that in a proceedin' in rem or quasi in rem,the
onl. relief that ma. be 'ranted b. the court a'ainst a defendant o-er 2hose person
it has not ac=uired ,urisdiction either b. -alid ser-ice of summons or b. -oluntar.
submission to its ,urisdiction, is limited to the res.

Similarl., in this case, 2hile the trial court ac=uired ,urisdiction o-er the res,
its ,urisdiction is limited to a rendition of ,ud'ment on the res. $t cannot e0tend its
,urisdiction be.ond the res and issue a ,ud'ment enforcin' petitioner?s personal
liabilit.. $n doin' so 2ithout first ha-in' ac=uired ,urisdiction o-er the person of
petitioner, as it did, the trial court -iolated her constitutional ri'ht to due process,
2arrantin' the annulment of the ,ud'ment rendered in the case.

/CR@OR, the instant petition is >RAN"!. "he !ecision
dated Au'ust *), *++: and the Resolution dated !ecember (6, *++: of the Court
of Appeals in CA->.R. SP No. E)7B; are S" AS$!. "he &ud'ment dated &ul.
((, *+++ and Order dated @ebruar. ;, *++( of the Re'ional "rial Court of Ca'a.an
de Oro Cit., #ranch *+, are li1e2ise S" AS$!.

SO OR!R!.
CCS"R ! &OHA, >.R. No. (E*7(E
Petitioner,
Present:

P3NO, J., Chairperson,
- -ersus - SAN!O%AL->3"$RRR,
CORONA,
ARC3NA, and
>ARC$A, JJ.
&3!> PLAC$!O C. MAR<3R,
in his capacit. as Presidin' &ud'e of
#ranch 7+, Manila-R"C, POPL Promul'ated:
O@ "C PC$L$PP$NS and "C
SCR"ARH O@ "C !PAR"MN" &anuar. :(, *++E
O@ &3S"$C,
Respondents.
0-----------------------------------------------------------------------------------------0

DECISION

A?CUNA, J.:


"his is a petition for certiorari and prohibition that see1s the Court to nullif.
and set aside the 2arrant of arrest issued b. respondent ,ud'e a'ainst petitioner in
Criminal Case No. +:-*(;;6* for -iolation of Article :(6, par. *4a5 of the Re-ised
Penal Code in relation to Presidential !ecree 4P.!.5 No. (EB;. Petitioner asserts
that respondent ,ud'e erred in findin' the e0istence of probable cause that ,ustifies
the issuance of a 2arrant of arrest a'ainst him and his co-accused.
Section E, Rule ((* of the Re-ised Rules of Criminal Procedure pro-ides:

S!". 6. When warrant of arrest may issue. (a) By the Regional Trial
Court. J /ithin ten 4(+5 da.s from the filin' of the complaint or information, the
,ud'e shall personall. e-aluate the resolution of the prosecutor and its supportin'
e-idence. Ce ma. immediatel. dismiss the case if the e-idence on record clearl.
fails to establish probable cause. I& '! &(n#$ 0%o2,2+! ",*$!, '! $',++ ($$*! ,
3,%%,n o& ,%%!$, o% , "o..(.!n o%#!% (& '! ,""*$!# ',$ ,+%!,#- 2!!n
,%%!$!# 0*%$*,n o , 3,%%,n ($$*!# 2- '! 4*#)! 3'o "on#*"!# '!
0%!+(.(n,%- (n1!$(),(on o% 3'!n '! "o.0+,(n o% (n&o%.,(on 3,$ &(+!#
0*%$*,n o $!"(on @ o& '($ R*+!. $n case of doubt on the e0istence of probable
cause, the ,ud'e ma. order the prosecutor to present additional e-idence 2ithin
fi-e 465 da.s from notice and the issuance must be resol-ed b. the court 2ithin
thirt. 4:+5 da.s from the filin' of the complaint or information.

0 0 0
8(9



"his Court finds from the records of Criminal Case No. +:-*(;;6* the
follo2in' documents to support the motion of the prosecution for the issuance of a
2arrant of arrest:

(. "he report of the National #ureau of $n-esti'ation to Chief State
Prosecutor &o-encito R. RuSo as re'ards their in-esti'ation on the
complaint filed b. pri-ate complainant Manuel !. A2iten a'ainst Mina
"an Cao T Ma. >racia "an Cao and %ictor N'o . "an for
s.ndicated estafa. "he report sho2s thatCao induced !. to in-est more
than a hundred million pesos in State Resources !e-elopment
Mana'ement Corporation, but 2hen the latter?s in-estments fell due, the
chec1s issued b. Cao in fa-or of !. as pa.ment for his in-estments 2ere
dishonored for bein' dra2n a'ainst insufficient funds or that the account
2as closed.
8*9

*. Affida-it-Complaint of pri-ate complainant Manuel !. A2iten.
8:9

:. Copies of the chec1s issued b. pri-ate complainant in fa-or of State
Resources Corporation.
879

7. Copies of the chec1s issued to pri-ate complainant representin' the
supposed return of his in-estments in State Resources.
869

6. !emand letter sent b. pri-ate complainant to Ma. >racia "an Cao.
8E9

E. Supplemental Affida-it of pri-ate complainant to include the
incorporators and members of the board of directors of State Resources
!e-elopment Mana'ement Corporation as participants in the conspirac.
to commit the crime of s.ndicated estafa. Amon' those included 2as
petitioner Chester !e&o.a.
8)9

). Counter-Affida-its of Chester !e &o.a and the other accused,
Ma. >racia Cao and !ann. S. Cao.


Also included in the records are the resolution issued b. State Prosecutor
#enn. Nicdao findin' probable cause to indict petitioner and his other co-accused
for s.ndicated estafa,
8B9
and a cop. of the Articles of $ncorporation of State
Resources !e-elopment Mana'ement Corporation namin' petitioner as
incorporator and director of said corporation.

"his Court finds that these documents sufficientl. establish the e0istence of
probable cause as re=uired under Section E, Rule ((* of the Re-ised Rules of
Criminal Procedure. Probable cause to issue a 2arrant of arrest pertains to facts
and circumstances 2hich 2ould lead a reasonabl. discreet and prudent person to
belie-e that an offense has been committed b. the person sou'ht to be arrested. $t
bears rememberin' that Fin determinin' probable cause, the a-era'e man 2ei'hs
facts and circumstances 2ithout resortin' to the calibrations of our technical rules
of e-idence of 2hich his 1no2led'e is nil. Rather, he relies on the calculus of
common sense of 2hich all reasonable men ha-e an abundance.G
8;9
"hus, the
standard used for the issuance of a 2arrant of arrest is less strin'ent than that used
for establishin' the 'uilt of the accused. As lon' as the e-idence presented sho2s
a prima facie case a'ainst the accused, the trial court ,ud'e has sufficient 'round to
issue a 2arrant of arrest a'ainst him.

"he fore'oin' documents found in the records and e0amined b. respondent
,ud'e tend to sho2 that therein pri-ate complainant 2as enticed to in-est a lar'e
sum of mone. in State Resources !e-elopment Mana'ement CorporationA that he
issued se-eral chec1s amountin' toP((7,*BE,+BE.(7 in fa-or of the corporationA
that the corporation, in turn, issued se-eral chec1s to pri-ate complainant,
purportedl. representin' the return of his in-estmentsA that said chec1s 2ere later
dishonored for insufficient funds and closed accountA that petitioner and his co-
accused, bein' incorporators and directors of the corporation, had 1no2led'e of its
acti-ities and transactions. "hese are all that need to be sho2n to establish
probable cause for the purpose of issuin' a 2arrant of arrest. $t need not be sho2n
that the accused are indeed 'uilt. of the crime char'ed. "hat matter should be left
to the trial. $t should be emphasiDed that before issuin' 2arrants of arrest, ,ud'es
merel. determine personall. the probabilit., not the certaint., of 'uilt of an
accused. Cence, ,ud'es do not conduct a de novo hearin' to determine the
e0istence of probable cause. "he. ,ust personall. re-ie2 the initial determination
of the prosecutor findin' a probable cause to see if it is supported b. substantial
e-idence.
8(+9
$n case of doubt on the e0istence of probable cause, the Rules allo2
the ,ud'e to order the prosecutor to present additional e-idence. $n the present
case, it is notable that the resolution issued b. State Prosecutor
#enn. Nicdao thorou'hl. e0plains the bases for his findin's that there is probable
cause to char'e all the accused 2ith -iolation of Article :(6, par. *4a5 of the
Re-ised Penal Code in relation to P.!. No. (EB;.

"he 'eneral rule is that this Court does not re-ie2 the factual findin's of the
trial court, 2hich include the determination of probable cause for the issuance of
2arrant of arrest. $t is onl. in e0ceptional cases 2here this Court sets aside the
conclusions of the prosecutor and the trial ,ud'e on the e0istence of probable
cause, that is, 2hen it is necessar. to pre-ent the misuse of the stron' arm of the
la2 or to protect the orderl. administration of ,ustice. "he facts obtainin' in this
case do not 2arrant the application of the e0ception.

$n addition, it ma. not be amiss to note that petitioner is not entitled to see1
relief from this Court nor from the trial court as he continuousl. refuses to
surrender and submit to the court?s
,urisdiction. &ustice @lorenD !. Re'alado e0plains the re=uisites for the e0ercise of
,urisdiction and ho2 the court ac=uires such ,urisdiction, thus:

0 0 0 Re=uisites for the e0ercise of ,urisdiction and ho2 the court ac=uires
such ,urisdiction:

a. Jurisdiction over the plaintiff or petitioner4 "his is ac=uired b.
the filin' of the complaint, petition or initiator. pleadin' before the court b. the
plaintiff or petitioner.

2. Jurisdiction over the defendant or resondent: T'($ ($ ,"9*(%!#
2- '! 1o+*n,%- ,00!,%,n"! o% $*2.($$(on 2- '! #!&!n#,n o% %!$0on#!n
o '! "o*% o% 2- "o!%"(1! 0%o"!$$ ($$*!# 2- '! "o*% o '(., )!n!%,++- 2-
'! $!%1("! o& $*..on$.

c. Jurisdiction over the sub5ect matter4 "his is conferred b. la2
and, unli1e ,urisdiction o-er the parties, cannot be conferred on the court b. the
-oluntar. act or a'reement of the parties.

d. Jurisdiction over the issues of the case: "his is determined and
conferred b. the pleadin's filed in the case b. the parties, or b. their a'reement in
a pre-trial order or stipulation, or, at times b. their implied consent as b. the
failure of a part. to ob,ect to e-idence on an issue not co-ered b. the pleadin's,
as pro-ided in Sec. 6, Rule (+.

e. Jurisdiction over the res 6or the property or thin0 hich is the
sub5ect of the liti0ation7. "his is ac=uired b. the actual or constructi-e seiDure b.
the court of the thin' in =uestion, thus placin' it in custodia le0is, as in
attachment or 'arnishmentA or b. pro-ision of la2 2hich reco'niDes in the court
the po2er to deal 2ith the propert. or sub,ect matter 2ithin its territorial
,urisdiction, as in land re'istration proceedin's or suits in-ol-in' ci-il status or
real propert. in the Philippines of a non-resident defendant.


&ustice Re'alado continues to e0plain:


$n t2o cases, the court ac=uires ,urisdiction to tr. the case, e-en if it has
not ac=uired ,urisdiction o-er the person of a nonresident defendant, as lon' as it
has ,urisdiction o-er the res, as 2hen the action in-ol-es the personal status of the
plaintiff or propert. in the Philippines in 2hich the defendant claims an
interest. $n such cases, the ser-ice of summons b. publication and notice to the
defendant is merel. to compl. 2ith due process re=uirements. 3nder Sec. (:: of
the Corporation Code, 2hile a forei'n corporation doin' business in
the Philippines 2ithout a license cannot sue or inter-ene in an. action here, it ma.
be sued or proceeded a'ainst before our courts or administrati-e tribunals.
8((9


A'ain, there is no e0ceptional reason in this case to allo2 petitioner to
obtain relief from the courts 2ithout submittin' to its ,urisdiction. On the contrar.,
his continued refusal to submit to the court?s ,urisdiction should 'i-e this Court
more reason to uphold the action of the respondent ,ud'e. "he purpose of a
2arrant of arrest is to place the accused under the custod. of the la2 to hold him
for trial of the char'es a'ainst him. Cis e-asi-e stance sho2s an intent to
circum-ent and frustrate the ob,ect of this le'al process. $t should be remembered
that he 2ho in-o1es the court?s ,urisdiction must first submit to its ,urisdiction.

<HEREFORE, the petition is DISMISSED.

No costs.

SO ORDERED.