THIRD DIVISION

[G.R. No. 104019. January 25, 1993.]

VICTRONICS COMPUTERS, INC., petitioner, vs. REGIONAL
TRIAL COURT, BRANCH 63, MAKATI, presided by JUDGE
JULIO R. LOGARTA, PANORAMA ENTERPRISES, INC., PASIG
TOURIST
DEVELOPMENT
CORP.,
GALACTIC
SPACE
DEVELOPMENT CORP., MALATE TOURIST DEVELOPMENT
CORP.,
CALOOCAN
TOURIST
DEVELOPMENT
CORP.,
BARRIENTOS & CO., INC., KARL C. VELHAGEN and
ARCHIMEDES R. KING, who operate business under the
names VICTORIA COURT, GMT CONSOLIDATED COMPANY
and VICTORIA GROUP OF COMPANIES, respondents.
Paras & Reynes Law Office for petitioner.
Ernest S. Ang for respondents.
SYLLABUS
1.REMEDIAL LAW; CIVIL PROCEDURE; MOTION TO DISMISS; LITIS
PENDENTIA AS A GROUND; REQUISITES. It is a rule that for litis
pendential to be invoked as a ground for the abatement or dismissal of
an action, the concurrence of the following requisites is necessary: (a)
identity of parties, or at least such as representing the same interest in
both actions; (b) identity of rights asserted and relief prayed for, the
relief being founded on the same facts; and (c) the identity in the two
(2) cases should be such that the judgment that may be rendered in the
pending case would, regardless of which party is successful, amount to
res judicata in the other.
2.ID.; ID.; ID.; ID.; AS A GENERAL RULE, THE SECOND CASE IS ABATED;
LIMITATIONS. Like res judicata as a doctrine, litis pendentia as a
principle is a sanction of public policy against multiplicity of suits.
Differently put, "[T]he principle upon which a 'plea of another action
pending' is sustained is that the latter action is deemed unnecessary
and vexatious." There is no hard and fast rule that governs the
determination of which of the actions should be abated. A review of
relevant cases decided by this Court discloses that generally, it is the
second case which is abated. Indeed, it seems that the maxim Qui prior
est tempore, potior est jure controls. To be sure, there are limitations to

this rule. At common law, if it appears to the court that the second
action was not brought to harass or vex the defendant, and is not in
fact vexatious, it may refuse to abate the second action, allow it to
stand, and order the first one to be discounted on proper terms. The
court may also permit the plaintiff to discontinue the first suit and
thereby defeat the plea in abatement where the second suit is
necessary in order to protect and secure the plaintiff's full rights, or
where the abatement of the second suit is necessary in order to protect
and secure the plaintiff's full rights, or where the abatement of the
second would result in possible loss of substantial rights on the part of
the plaintiff.
3.ID.; ID.; ID.; ID.; PROVIDES THAT THERE IS A PENDING ACTION, NOT A
PENDING PRIOR ACTION. In our jurisdiction, the law itself (Section
1(e), Rule 16, Rules of Court) does not specifically require that the
pending action which would hold in abatement the other must be a
pending prior action. Thus, in Teodoro vs. Mirasol, (99 Phil. 150, 153
[1956]) this Court observed: "It is to be noted that the Rules do not
require as a ground for dismissal of a complaint that there is a prior
pending action. They provide that there is a pending action, not a
pending prior action. The fact that the unlawful detainer suit was of a
later date is no bar to the dismissal of the present action. We find,
therefore, no error in the ruling of the court a quo that plaintiff's action
should be dismissed on the ground of the pendency of another more
appropriate action between the same parties and for the same cause."
4.ID.; ID.; ID.; ID.; ID.; BONA FIDES OR GOOD FAITH OF THE PARTIES
MUST BE CONSIDERED; CASE AT BAR. It is interesting to note that in
common law, as earlier adverted to, and pursuant to the Teodoro vs.
Mirasol case, the bona fides or good faith of the parties is a crucial
element. In the former, the second case shall not be abated if not
brought to harass or vex; in the latter, the first case shall be abated if it
is merely an anticipatory action or, more appropriately, an anticipatory
defense against an expected suit a clever move to steal the march
from the aggrieved party. In the case at bar, We do not hesitate to rule
that the second case, Civil Case No. 91-2192, was filed not so much
upon the inspiration of unadulterated good faith to seek redress for a
genuine wrong committed but more to vex or harass in another forum
the plaintiff in the first case, the herein petitioner. What cannot escape
Our attention is the undue, if not indecent, haste in the preparation of
the complaint in Civil Case No. 91-2192 by the counsel for the
defendants in Civil Case No. 91-2069. Civil Case No. 91-2192 is for the

nullification of a contract the purchase order signed by no less than

the authorized officers of the six (6) respondent corporations. It is,
therefore, based upon a written document as provided Section 7, Rule 8
of the Rules of Court. There was absolutely no compliance with this
requisite as no copy of the purchase order was set forth in the body of
the complaint or attached to the complaint itself. The non-observance
of this simple yet basic rule cannot be attributed to the ignorance of the
lawyers who, measured by their pleadings in this case, appear to be
experienced and well-versed in the law, but to the frenzied efforts to file
the complaint at the earliest possible time. To make it appear that the
complaint was prepared before service of summons on the defendants
in Civil Case No. 91-2069, it was dated 7 August 1991. It was, however,
filed on 9 August 1991 although the office of the abovementioned
lawyers is located at 2129 Pasong Tamo St., Makati, Metro Manila,
within the same municipality wherein the court sits. Moreover, all six (6)
corporations likewise have their principal office at the same pasong
Tamo address. The private respondents' claim in their Comment that:
". . . when undersigned counsel filed Civil Case No. 91-2192, neither he
nor his clients had actual notice of the earlier suit filed by petitioner.
Civil Case No. 91-2192 was filed in good faith." is clearly self-serving.
Besides, counsel is careful enough to use "actual notice" thereby
admitting, in effect, that some other form of notice was received.
5.ID.; INTERIM RULES AND REGULATION; FORUM SHOPPING; CONCEPT;
APPLICATION IN CASE AT BAR. In People v. Court of Appeals, (101
SCRA 450 [1980]) We noted that forum-shopping has its roots in the
rule that a party should not be allowed to pursue simultaneous
remedies in two (2) different forums for it does havoc to the rule on
orderly procedure. Later, in E. Razon Inc. vs. Philippine Port Authority,
(G.R. No. 75197, Resolution of 31 July 1986, quoted in Buan vs. Lopez,
Jr., 145 SCRA 34, 38-39 [1986]) We specifically declared that forumshopping is an act of malpractice that is proscribed and condemned as
trifling with the courts and abusing their processes; it is improper
conduct that tends to degrade the administration of justice. Thus, the
said rule has been formalized in Section 17 of the Interim Rules and
Guidelines issued by this Court on 11 January 1983 in connection with
the implementation of the Judiciary Reorganization Act (Batas
Pambansa Blg. 129). A review of the cases on forum-shopping reveals,
however, that they involve parties filing two (2) or more suits in
different forums. The rule has not been extended to a defendant who,
for reasons known only to him, commences a new action against the
plaintiff instead of filing a responsive pleading in the other case
setting forth therein, as cause of action, specific denials, special and

affirmative defenses or even counterclaims. Thus, Velhagen's and King's

motion to dismiss Civil Case No. 91-2069 by no means negates the
charge of forum-shopping as such did not exist in the first place.
DECISION
DAVIDE, JR., J p:
This is a petition for review on certiorari under Rule 45 of the Rules of
Court. Petitioner seeks to set aside, for being inconsistent with law and
jurisprudence, the 22 January 1992 Order of respondent Branch 63 of
the Regional Trial Court (RTC) of Makati, Metro Manila which, among
others, denied a motion for reconsideration of its earlier dismissal, on
the ground of lis pendens, of a collection suit docketed as Civil Case No.
91-2069 filed against private respondents Karl C. Velhagen and
Archimedes R. King, alleged operators of a business under the names
VICTORIA COURT, GMT CONSOLIDATED COMPANY and VICTORIA GROUP
OF COMPANIES. Petitioner further asks this Court, in the exercise of its
supervisory power over lower courts, to direct the respondent Court to
issue alias summonses to the respondent corporations which were
impleaded as additional defendants in the amended complaint filed in
said Civil Case No. 91-2069, and to order the consolidation of this case
in Branch 63 with Civil Case No. 91-2192 pending before Branch 150 of
the said court.
The records disclose the following antecedents:
Petitioner Victronics Computers, Inc., a domestic corporation engaged
in the sale of computer systems and peripherals, submitted a quotation
for office systems to service the networking requirements of various
Victoria Court branches.
Satisfied with the said quotations, private respondents Velhagen and
King placed an order with the petitioner in a Purchase Order 1 form on
which is written "GMT CONSOLIDATED" above the printed word
COMPANY, and the address 2129 Pasong Tamo St., Makati, Metro Manila
below it. The private respondents ordered six (6) sets of 80 DATA 386
computer system with peripherals for the net consideration, after
deducting a P7,000.00 discount, of P767,000.00 subject, to the
following terms:
a)Payment 50% down, 50% COD upon completion of
delivery.

b)Delivery within 30 calendar days upon receipt of

P.O. and 50% down payment.

The case was docketed as Civil Case No. 91-2069 and was raffled off to
Branch 63 of the said court, presided over by herein respondent Judge
Julio R. Logarta.

c)Penalty 1% of total P.O. amount per day of delay.

These systems were to be delivered to the parties therein indicated.
namely: VCAD, VCCU, VCHI, VCNE, VCMA and VCES. Per the delivery
receipts, these acronyms stand for Victoria Court drive-in motels
located in different places. llcd

The fifty per cent (50%) downpayment agreed upon was only paid.
Thereupon, petitioner delivered on 22 May 1991 three (3) of the six (6)
sets to Victoria Court/North EDSA, Victoria Court/Adriatico and Victoria
Court/Cuneta. 2 The remaining sets were delivered on 20 June 1991 to
Victoria
Court/Hillcrest,
Victoria
Court/Panorama
and
Victoria
Court/McArthur. 3
As revealed in the complaint in Civil Case No. 91-2192, each of the
aforementioned establishments is owned by the herein six (6)
respondent corporations which, however, decided sometime in 1986 "to
band together for their mutual interest and benefit, under the trade
name and style of the Victoria Court Group of Companies." 4
As further revealed in the Comment of these corporations, they operate
under a common management team wherein respondents Velhagen
and King are the General Manager and Chief Executive Officer,
respectively. 5
Only fifty per cent (50%) of the purchase price of each of the sets
delivered to the different establishments was paid by the said
corporations. 6 The outstanding balance not having been paid within
and even after the period stipulated in the Purchase Order despite
demands for its payment made on Velhagen and King, the petitioner
filed, on 26 July 1991, with the RTC of Makati a Complaint 7 for a sum of
money and damages against:
"KARL C. VELHAGEN and ARCHIE R. KING, who operate
business under the names VICTORIA COURT, GMT
CONSOLIDATED COMPANY, and VICTORIA GROUP OF
COMPANIES."

Defendants Velhagen and King, herein private respondents, were each

served with a summons and a copy of the complaint on 8 August 1991.
8
The following day, 9 August 1991, the six (6) respondent corporations 9
filed with the RTC of Makati a Complaint, dated 7 August 1991, 10 for
the nullification of the abovementioned Purchase Order and for
damages against the herein petitioner and one Teodorico B. Kabigting.
It is prayed for in the complaint that:
". . . judgment be rendered for the plaintiffs and against
the defendants declaring the contract to purchase the
aforementioned computer equipment null and void for
fraud and undue influence, and ordering defendants,
jointly or severally, to pay plaintiffs:
1.The
sum
of
P383,500.00
plus
reasonable interest of at least 2% per month
from the month of May 1991 until the amount is
actually paid, as compensary (sic) or actual
damages;
2.The sum of P500,000.00 as exemplary
damages;
3.The sum of P100,000.00 and a per
appearance fee of P1,000.00 as and by way of
attorney's fees;
4.The cost of the suit."
The case was docketed as Civil Case No. 91-2192 and was raffled off
to Branch 150 of the said court.
Four (4) causes of action are alleged in this complaint. In the first, the
corporations claim that defendant Kabigting, then the Manager of the
Management Information Services of the Victoria Court Group of
Companies who was instructed to canvass or conduct a price survey of
computer equipment supplied by different companies. connived with

Victor Mariano, the petitioner's General Manager and the latter's old
and close friend, in consideration of an alleged promise of a substantial
commission, to falsify the price survey report and recommend the
purchase of the computer equipment from the petitioner corporation. A
routine check of the transaction likewise disclosed an overpricing of the
equipment by at least P200,000.00 while an audit revealed that the
equipment sold was among the surplus stock of the petitioner. In the
second cause of action, they allege that they forthwith informed the
petitioner's Mr. Mariano about the fraud and sought an audience with
him for an amicable solution to the controversy, but that the petitioner
failed to respond and instead referred the matter to its attorney who in
turn wrote a letter of demand for the payment of the balance of the
purchase price. Reacting, they also referred the matter to their lawyer
who wrote the petitioner a letter informing it that the contract was
being voided due to fraud and undue influence and demanding that the
fifty per cent (50%) downpayment be returned with a reasonable
interest at the rate of two per cent (2%) per month in exchange for the
return of "all computer equipment purchased from defendant (herein
petitioner) in the same condition as they were received." 11 Upon the
petitioner's failure to respond positively to this offer, they filed the
complaint. In the third cause of action, they allege bad faith and a
fraudulent intent on the part of the defendants and ask for P500,000.00
as exemplary damages. The fourth cause of action is for attorney's and
appearance fees.
No copy of any document whatsoever is attached to the complaint in
said Civil Case No. 91-2192. cdrep
On 22 August 1991, private respondents Velhagen and King,
represented by counsel of record for the six (6) corporations in Civil
Case No. 91-2192 the law firm of ANG, CADIZ and ASSOCIATES
filed in Civil Case No. 91-2069 a Motion To Dismiss and/or To Suspend
Proceedings based on the following grounds: (a) plaintiff (petitioner
herein) failed to verify the complaint, (b) plaintiff failed to sue the
proper parties and (c) there is a prejudicial question or a pending
incident before another court. In support of these grounds, they allege
that (a) verification is a formal requirement under Section 6, Rule 7 of
the Rules of Court; (b) the transaction in question was not entered into
by them in their personal capacities they acted for and on behalf of
the corporations they represent; hence, the latter, who chose not to
honor the contract, are the real parties in interest; moreover, "Victoria
Court, GMT Consolidated Company and Victoria Group of Companies . . .
are mere tradenames" 12 none of these named companies really

exist; and (c) Civil Case No. 91-2192 (erroneously written as 91-2191)
for the nullification of the subject purchase order has been filed against
the petitioner and is pending before Branch 150 of the trial court;
accordingly. "[A]t the very least, the Honorable Court (Branch 63)
should suspend all proceedings in this case because of the existence of
a prejudicial question or a pending incident before another court."
Elaborating thereon, said movants state:
"There is a situation wherein two suits were filed for
different causes of action but involving the same
transaction or contract. One case, the one pending
before this Honorable Court, is for the enforcement of
the contract, or more specifically, for the collection of
the balance or sum of money as provided for in the
contract. In the other case before another court, what is
being sought is the nullification or the voiding of the
same contract for alleged fraud and undue influence.
There is no debate that the more basic question is
before the other court, as the very validity of the
contract sought to be enforced is at issue there.
It is clear therefore that the second case is prejudicial to
the determination of the first case. Whether or not the
suit pending before this Honorable Court will prosper
depends entirely on how the case in the other court will
fare. If for example the other court should determine
that there is (sic) sufficient grounds to nullify the
contract, then the collection suit before this Honorable
Court must necessarily fail. It is only after the other
court should determined (sic) that the questioned
contract is valid can this Honorable Court proceed with
the collection case.
Suspension of the proceedings before this Honorable
Court is therefore the prudent thing to do. This will
avoid the absurd situation wherein one court will find
for one party in one case, and the other court will find
for the adverse party in the second case. It is also an
act of courtesy to a co-equal branch of the same court."
13
They then end with an alternative prayer, thus:

"WHEREFORE, premises considered. it is respectfully

prayed that the instant Complaint be dismissed for all
or any of the grounds aforecited. On the alternative, it
is prayed that the proceedings before the Honorable
Court be at least suspended until the final resolution of
the other case before Branch 150 of the Regional Trial
Court of Makati." 14
Meanwhile, on 5 September 1991, the herein petitioner filed in Civil
Case No. 91-2192 a Special Appearance and Motion To Dismiss 15
asking the trial court to dismiss the said case on grounds of improper
service of summons and lack of jurisdiction over it as defendant therein.
LibLex
On 16 September 1991, Branch 63 of the Makati RTC, through
respondent Judge Julio Logarta, issued an order dismissing Civil Case
No. 91-2069 because of litis pendentia. 16 The court gave the following
reasons, quoted verbatim, in support of its ruling:
". . . Clearly, the elements of litis pendentia, as a
ground for a motion to dismiss is present, to wit:
'1.Identity of parties or at least such as
representing the same interests in both actions;
2.Identity of rights asserted and prayed
for, the reliefs being founded on the same facts;
3.The identity of the presiding particulars
should be such that any judgment which may be
rendered on the other action will regardless of
which party is successful amount to res judicata
in the action under consideration (FEU Dr.
Nicanor Reyes Medical Foundation vs. Trajano
152 SCRA, 453 (1987); Lopez vs. Villaruel, G.R.
No. 54323, 1988).'
Further, it was held that 'the Rule does not require as a ground for
dismissal of a complaint that there is a prior action, but only pending
action (Teodoro vs. Mirasol 53 O.G., 8088 99 Phil. 150).' Thus, the
contention of plaintiff that the case before this branch is 123 days older
than Civil Case No. 91-2192 before Branch 150, hence, the one lodged
with Branch 150 should be the one dismissed by litis pendentia is

untenable. Moreover, 'inclusion of additional parties in second case is

no obstacle to its dismissal on the ground of litis pendentia' (Investors
Finance Corp. vs. Judge Ebarle, G.R. No. 70640, June 29, 1988)." 17

On 19 September 1991, petitioner filed in Civil Case No. 91-2069 a

contempt charge against respondents Velhagen and King for forumshopping, 18 claiming that after having respectively received the
summons and a copy of the complaint, both respondents did not file an
answer with compulsory counterclaim. Instead, "using the names of
certain corporations that represent the same interests they advance,
[they] filed a separate action one day later before Branch 150 of the
Makati Regional Trial Court in Civil Case No. 91-2192" 19 which arose
from the same transaction or occurrence as that obtaining in Civil Case
No. 91-2069; as a matter of fact, the complaint in the former reads like
an answer with compulsory counterclaim to the complaint in the latter.
Hence, both are guilty of forum-shopping, double dealing, trifling with
the court and abusing its processes. 20
Meanwhile, acting on the petitioner's motion to dismiss Civil Case No.
91-2192, Branch 150 of the court below, per Judge Zeus Abrogar,
handed down an order, on 25 September 1991, directing in order to
remove any doubt on the propriety of the service of summons the reservice of summons on the petitioner. 21
On 4 October 1991, after allegedly accidentally learning of the 16
September 1991 Order of dismissal of Civil Case No. 91-2069, petitioner
requested, and thereafter obtained, a photocopy of the said order which
was not, unfortunately, served on the petitioner's counsel until then. 22
On 9 October 1991, petitioner filed in Civil Case No. 91-2069 an Ex
Abundante Cautela Motion To Refer Forum-Shopping Charge to
Executive Judge. 23 On the same date, petitioner filed a Motion for
Reconsideration 24 of the said order of dismissal.
On 14 October 1991, after proper service of summons to it, petitioner
filed a Motion To Dismiss 25 Civil Case No. 91-2192 on the grounds of
litis pendentia and forum shopping.
Thereupon, on 11 December 1991, petitioner filed in Civil Case No. 912069 a motion for the consolidation 26 of the two (2) cases before
Branch 63 where the prior case was filed; on 6 January 1992, it also

filed in the same case a Manifestation Pro Hac Vice 27 wherein it stated
that there was technically no pending action before" Branch 150 as it
had not yet acquired jurisdiction over the person of the petitioner (due
to improper service of summons) as evidenced by the 25 September
1991 Order of Judge Abrogar himself.
In the meantime, however, petitioner filed in Civil Case No. 91-2192 an
Answer with compulsory Counterclaim 28 dated 20 January 1992. One
of the Special and Affirmative Defenses averred therein is the pendency
in Branch 63 of Civil Case No. 91-2069. Also on 20 January 1992,
petitioner filed in Civil Case No. 91-2069 an Amended Complaint
impleading therein, as additional defendants, the six (6) corporations
which sued as plaintiffs in Civil Case No. 91-2192. 29
On 7 February 1992, the Clerk of Court of Branch 63 sent the petitioner,
by registered mail, 30 a copy of the 22 January 1992 Order in Civil Case
No. 91-2069 31 which resolved the various motions filed by the latter.
The said order reads:
"Consequently, the Motion for Consolidation filed by
plaintiff on December 11, 1991, perforce, should also
be DENIED for being moot and academic.
WHEREFORE, premises considered, the Motion for
Reconsideration dated October 7, 1991; the Contempt
Charge for Forum-Shopping; the Motion to Refer the
Contempt Charge to the Executive Judge; the Motion for
Consolidation; and, Manifestation Pro Hac Vice are
hereby DENIED, and the order dated September 16,
1991, dismissing the above-entitled case is hereby
REITERATED."
Anent the particular issue of forum shopping, the lower court held that
the same "is negated by the move of defendants (private respondents
Velhagen and King) to dismiss the case filed before this court [Civil Case
No. 91-2069], to give way to that which pends before Branch 150 [Civil
Case No. 91-2192]." And, on the matter of litis pendentia, it reiterated
its ruling that, the filing of one action ahead of another is not decisive
on the issue of which of the two (2) identical actions in two (2) separate
courts of concurrent jurisdiction should be dismissed. cdll

As a consequence of this 22 January 1992 Order, respondent Court, in

Civil Case No. 91-2069, issued on 20 February 1992 an order denying
the petitioner's motion for the issuance of an alias summons. 32
Hence, the instant petition wherein the petitioner claims that the
respondent Court erred:
"(1)in equating respondents' ground of 'pending
incident before another court' to ask for suspension of
proceedings with litis pendentia under Rule 16 when
respondents' grounds to ask for dismissal were only (a)
lack of verification; and (b) not having initially
impleaded respondent corporations as proper parties
grounds not found in Rule 16;
(2)in ruling, with precipitate haste, and in insisting,
despite a chance to reconsider, that there was another
pending action at the time of dismissal when
technically there was none since Branch 50 was still
trying to acquire jurisdiction over petitioner's person
and to notify petitioner by new summons some 2 weeks
later about the filing of the second;
(3)in preferring to maintain the second action over the
first, which (a) was 123 cases (sic) older than the
second; (b) was the one pending when the second one
was just filed; and (c) was meant to collect the unpaid
balance of close to half a million pesos that
respondents still owe and which in substantial justice
was entitled to be heard if not preferentially over the
second, at least jointly with the second upon
consolidation;
(4)in disregarding the Supreme Court's rulings in vda.
de Tolentino v. de Guzman, Pambusco v. Ocfemia,
Ramos v. CIR, and other applicable decisions;
(5)in not finding, by itself or through the executive
judge, that the institution of the second action was a
specie of forum shopping, in she light of DBP v. IAC,
given that (a) the second action came 2 weeks later
after the first complaint; (b) the second complaint was
filed after respondents had already received a copy of

the first; (c) respondents complaint reads like an

answer with compulsory counterclaim to petitioner's
complaint; and (d) the second action arose from the
same transaction, facts, and circumstances identical to
those in an already pending proceeding;
(6)in totally ignoring the existence of the amended
complaint; and
(7)in releasing an order on February 7, 1992 that did
not conform with the prevailing state of affairs of the
action as of that time and with applicable Supreme
Court decisions since (a) the amended complaint had
already rendered the first complaint functus oficio along
with resolutions that attached to it; (b) the motion for
alias summons should have been granted as a matter
of course; and (c) consolidation should have afterwards
been granted to promote the Supreme Court's avowed
preference for consolidation as expressed in Active
Wood Products v. CA because it is a 'beneficial and
desirable' practice." 33
On 10 June 1992, 34 after the private respondents filed their Comment
35 to the petition (on 20 April 1992) and the petitioner filed its Reply 36
thereto (on 28 May 1992), We resolved to give due course to the
petition and required the parties to submit their respective Memoranda,
which they subsequently complied with.
The pivotal issues raised in the instant petition are: (1) whether or not
the respondent Court erred in dismissing, on the ground of litis
pendentia, Civil Case No. 91-2069 which has priority with respect to the
time of filing, and (2) whether or not the private respondents are guilty
of forum-shopping.
It is a rule that for litis pendentia to be invoked as a ground for the
abatement or dismissal of an action, the concurrence of the following
requisites is necessary: (a) identity of parties, or at least such as
representing the same interest in both actions; (b) identity of rights
asserted and relief prayed for, the relief being founded on the same
facts; and (c) the identity in the two (2) cases should be such that the
judgment that may be rendered in the pending case would, regardless
of which party is successful, amount to res judicata in the other. 37

The presence of all the foregoing requisites with respect to Civil Case
No. 91-2069 and Civil Case No. 91-2192 is not controverted by the
parties. As a matter of fact, both invoked these identities in their
respective motions to dismiss.
As to the first requirement, it is quite evident that the petitioner is a
party in both cases. There is, however, an initial confusion as to the
personalities of the defendants in Civil Case No. 91-2069 and the
plaintiffs in Civil Case No. 91-2192, who are claimed to be natural
persons doing business under the names of "Victoria Court, GMT
Consolidated Company and Victoria Group of Companies" and juridical
persons (the six (6) corporations), respectively. In the light of the
admission by the six (6) corporations that they banded together for
their mutual interest and benefit under the trade name and style of the
Victoria Group of Companies; that they put up a common management
team with respondents Velhagen and King as General Manager and
Chief Executive Officer, respectively; that the purchase order in
question is the official act of the said officers; and that the computer
sets were in fact received by them for which they each paid a
downpayment of fifty per cent (50%) of the purchase price thereof,
there can be no doubt that the defendants in the first case and the
plaintiffs in the second case represent the same interests.
As regards the second element, a careful reading of the allegations in
the parties' respective complaints and motions to dismiss in the two (2)
civil actions below reveals that both assert rights founded on an
identical set of facts which give rise to one basic issue the validity of
the contract in question, the purchase order for the computer
equipment. Civil Case No. 91-2069 actually involves an action for
specific performance; it thus upholds the contract and assumes its
validity. Civil Case No. 91-2192, on the other hand, is for the
nullification of the contract on the grounds of fraud and vitiated
consent. While ostensibly the cause of action in one is opposite to that
in the other, in the final analysis, what is being determined is the
validity of the contract. It would not have been unlikely that in its
answer filed in Civil Case No. 91-2192, the petitioner would merely
reiterate its allegations in the complaint in Civil Case No. 91-2069
sustaining and invoking the validity of the purchase order and setting
up lis pendens as a defense. This is what it exactly did. It would not
have been likewise unlikely that the defense of the private respondents
in Civil Case No. 91-2069 would be one in pursuit of their theory, as
plaintiffs, in Civil Case No. 91-2192. Thus, the identity of rights asserted
cannot be disputed. Howsoever viewed, it is beyond cavil that

regardless of the decision that would be promulgated in Civil Case No.

91-2069, the same would constitute res judicata on Civil Case No. 912192 and vice-versa. But which case should be abated? Squarely put,
should it be the second, which was filed fourteen (14) days after the
filing of the first, or should it be the first? LLjur

Like res judicata as a doctrine, litis pendentia as a principle is a sanction

of public policy against multiplicity of suits. 38 Differently put, "[T]he
principle upon which a 'plea of another action pending' is sustained is
that the latter action is deemed unnecessary and vexatious." 39
There is no hard and fast rule that governs the determination of which
of the actions should be abated. A review of relevant cases decided by
this Court discloses that generally, it is the second case which is
abated. Indeed, it seems that the maxim Qui prior est tempore, potior
est jure 40 controls.
To be sure, there are limitations to this rule. At common law, if it
appears to the court that the second action was not brought to harass
or vex the defendant, and is not in fact vexatious, it may refuse to
abate the second action, allow it to stand, and order the first one to be
discontinued on proper terms. The court may also permit the plaintiff to
discontinue the first suit and thereby defeat the plea in abatement
where the second suit is necessary in order to protect and secure the
plaintiff's full rights, or where the abatement of the second suit is
necessary in order to protect and secure the plaintiff's full rights, or
where the abatement of the second would result in possible loss of
substantial rights on the part of the plaintiff. 41
In our jurisdiction, the law itself 42 does not specifically require that the
pending action which would hold in abatement the other must be a
pending prior action. Thus, in Teodoro vs. Mirasol, 43 this Court
observed:
"It is to be noted that the Rules do not require as a
ground for dismissal of a complaint that there is a prior
pending action. They provide that there is a pending
action, not a pending prior action. The fact that the
unlawful detainer suit was of a later date is no bar to
the dismissal of the present action. We find, therefore,
no error in the ruling of the court a quo that plaintiff's

action should be dismissed on the ground of the

pendency of another more appropriate action between
the same parties and for the same cause."
In Roa-Magsaysay vs. Magsaysay, 44 wherein it was the first case which
was abated, this Court ruled:
"In any event, since We are not really dealing with
jurisdiction out mainly with venue, considering both
courts concerned do have jurisdiction over the causes
of action of the parties herein against each other, the
better rule in the event of conflict between two courts
of concurrent jurisdiction as in the present case, is to
allow the litigation to be tried and decided by the court
which, under the circumstances obtaining in the
controversy, would, in the mind of this Court, be in a
better position to serve the interests of justice,
considering the nature of the controversy, the
comparative accessibility of the court to the parties,
having in view their peculiar positions and capabilities,
and other similar factors. Without in any manner
casting doubt as to the capacity of the Court of First
Instance of Zambales to adjudicate properly cases
involving domestic relations, it is easy to see that the
Juvenile and Domestic Relations Court of Quezon City
which was created in order to give specialized attention
to family problems, armed as it is with adequate and
corresponding facilities not available to ordinary courts
of first instance, would be able to attend to the matters
herein dispute with a little more degree of expertise
and experience, resulting in better service to the
interests of justice. A reading of the causes of action
alleged by the contending spouses and a consideration
of their nature, cannot but convince Us that, since
anyway, there is an available Domestic Court that can
legally take cognizance of such family issues, it is
better that said Domestic Court be the one chosen to
settle the same as the facts and the law may warrant."
We made the same pronouncement in Ramos vs. Peralta: 45
"Finally, the rule on litis pendentia does not require that
the later case should yield to the earlier case. What is

required merely is that there be another pending

action, not a prior pending action. Considering the
broader scope of inquiry involved in Civil Case No. 4102
and the location of the property involved, no error was
committed by the lower court in deferring to the Bataan
court's jurisdiction."
An analysis of these cases unravels the ratio for the rejection of the
priority-in-time rule and establishes the criteria to determine which
action should be upheld and which is to be abated. In Teodoro, this
Court used the criterion of the more appropriate action. We ruled
therein that the unlawful detainer case, which was filed later, was the
more appropriate action because the earlier case for specific
performance or declaratory relief filed by the lessee (Teodoro) in the
Court of First Instance (CFI) to seek the extension of the lease for
another two (2) years or the fixing of a longer term for it, was
"prompted by a desire on plaintiff's part to anticipate the action for
unlawful detainer, the probability of which was apparent from the letter
of the defendant to the plaintiff advising the latter that the contract of
lease expired on October 1, 1954." 46 The real issue between the
parties therein was whether or not the lessee should be allowed to
continue occupying the leased premises under a contract the terms of
which were also the subject matter of the unlawful detainer case.
Consonant with the doctrine laid down in Pue vs. Gonzales 47 and Lim
Si vs. Lim, 48 the right of the lessee to occupy the land leased against
the lessor should be decided under Rule 70 of the Rules of Court; the
fact that the unlawful detainer case was filed later was then of no
moment. Thus, the latter was the more appropriate action.
The "more appropriate action" criterion was also applied in Ramos vs.
Peralta, 49 Ramos, the lessee of a fishpond located in Pilar, Bataan,
sought to consign with the CFI of Manila the advance rentals for the
fishpond for 15 March 1976 and 15 June 1976 after its tender was
refused by the lessors (Ortaez spouses) 50 and after he was informed
by the vendee of the property, P.R. Roman Inc. in its letter of 1 May
1976 that it had acquired the property and would take possession
thereof on 16 May 1976. Ramos filed the consignation case, docketed
as Civil Case No. 103647, with the lower court on 2 August 1976.
Meanwhile, on 13 August 1976, P.R. Roman Inc. filed with the CFI of
Bataan a complaint for quieting of title against Ramos; this case was
docketed as Civil Case No. 4102. Consequently, P.R. Roman, Inc. filed a
motion to dismiss Civil Case No. 103647 on the ground of, inter alia, lis
pendens. The motion was granted. On appeal, this Court affirmed the

lower court's decision considering the "broader scope of inquiry

involved in Civil Case No. 4102 and the location of the property
involved." cdphil
In Roa-Magsaysay, the criterion used was the consideration of the
interest of justice. In applying this standard, what was asked was which
court would be "in a better position to serve the interests of justice," 51
taking into account (a) the nature of the controversy, (b) the
comparative accessibility of the court to the parties and (c) other
similar factors. While such a test was enunciated therein, this Court
relied on its constitutional authority to change venue to avoid a
miscarriage of justice.
It is interesting to note that in common law, as earlier adverted to, and
pursuant to the Teodoro vs. Mirasol 52 case, the bona fides or good
faith of the parties is a crucial element. In the former, the second case
shall not be abated if not brought to harass or vex; in the latter, the first
case shall be abated if it is merely an anticipatory action or, more
appropriately, an anticipatory defense against an expected suit a
clever move to steal the march from the aggrieved party.
In the case at bar, We do not hesitate to rule that the second case, Civil
Case No. 91-2192, was filed not so much upon the inspiration of
unadulterated good faith to seek redress for a genuine wrong
committed but more to vex or harass in another forum the plaintiff in
the first case, the herein petitioner. What cannot escape Our attention
is the undue, if not indecent, haste in the preparation of the complaint
in Civil Case No. 91-2192 by the counsel for the defendants in Civil Case
No. 91-2069. Civil Case No. 91-2192 is for the nullification of a contract
the purchase order signed by no less than the authorized officers of
the six (6) respondent corporations. It is, therefore, based upon a
written document. Section 7, Rule 8 of the Rules of Court expressly
provides that:
"SECTION 7.Action or defense based on document.
Whenever an action or defense is based upon a written
instrument or document, the substance of such
instrument or document shall be set forth in the
pleading, and the original or a copy thereof shall be
attached to the pleading as an exhibit, which shall be
deemed to be a part of the pleading, or said copy may
with like effect be set forth in the pleading." (Emphasis
supplied).

There was absolutely no compliance with this requisite as no copy of

the purchase order was set forth in the body of the complaint or
attached to the complaint itself. The non-observance of this simple yet
basic rule cannot be attributed to the ignorance of the lawyers who,
measured by their pleadings in this case, appear to be experienced and
well-versed in the law, but to the frenzied efforts to file the complaint at
the earliest possible time. To make it appear that the complaint was
prepared before service of summons on the defendants in Civil Case
No. 91-2069, it was dated 7 August 1991. 53 It was, however, filed only
on 9 August 1991 although the office of the abovementioned lawyers is
located at 2129 Pasong Tamo St., 54 Makati, Metro Manila, within the
same municipality wherein the court sits. Moreover, all six (6)
corporations likewise have their principal office at the same Pasong
Tamo address. 55 The private respondents' claim in their Comment
that:

1191 of the Civil Code, it was acting well within its rights. The
subsequent action for the annulment of the contract on grounds of
fraud and vitiated consent is nothing but a mere defense thereto. prLL
Respondents Velhagen and King very well acknowledged the weakness
of the defense of lis pendens. In their Motion to Dismiss and/or Suspend
Proceedings, 59 they did not categorically refer to Civil Case No. 912192 as a pending action. In lieu thereof, they chose the phrase
"prejudicial question or a pending incident before another court;" in
consonance therewith, they even prayed that if Civil Case No. 91-2069
may not be dismissed for any of the grounds therein invoked, it should
be suspended until the final resolution of Civil Case No. 91-2192.
Fortunately for them, respondent Court read the phrase "prejudicial
question or a pending incident" as lis pendens and thereafter decreed
the dismissal of said Civil Case No. 91-2069. This clearly amounted to
grave abuse of discretion.
And now on the issue of forum-shopping.

". . . when undersigned counsel filed Civil Case No. 912192, neither he nor his clients had actual notice of the
earlier suit filed by petitioner. Civil Case No. 91-2192
was filed in good faith." 56
is clearly self-serving. Besides, counsel is careful enough to use
"actual notice" thereby admitting, in effect, that some other form of
notice was received.
Being merely vexatious, Civil Case No. 91-2192 is the abatable case.
Independently of the element of bona fides, the fact remains that under
the peculiar circumstances attending the transaction in question, the
first case for specific performance is the more appropriate action.
In the first place, petitioner, the unpaid seller in the amount of fifty per
cent (50%) of the purchase price, had completely delivered the six (6)
computer sets to the establishments of the six (6) respondent
corporations within the period stipulated in the purchase order. Despite
their assertion in the complaint in Civil Case No. 91-2192 that the
equipment was "outmoded and obsolete," 57 they neither claim the
inability to use the computer sets nor insinuate that they had, at any
time, called upon the petitioner to account under its warranty against
hidden defects. 58 They did not even offer to return the computer
equipment. Thus, in reality, it is the petitioner who has been aggrieved;
in availing of the remedy of specific performance allowed under Article

In its Order of 22 January 1992, respondent Court held:

"Likewise, the Court finds no basis to cite defendant in
contempt of court, allegedly for engaging in forumshopping as this allegation is negated by the move of
defendants to dismiss the case filed before this Court,
to give way to that which pends before Branch 150." 60
Respondent Court does not seem to have a full grasp of the
underpinnings of forum-shopping. In People vs. Court of Appeals, 61 We
noted that forum-shopping has its roots in the rule that a party should
not be allowed to pursue simultaneous remedies in two (2) different
forums for it does havoc to the rule on orderly procedure. Later, in E.
Razon Inc. vs. Philippine Port Authority, 62 We specifically declared that
forum-shopping is an act of malpractice that is proscribed and
condemned as trifling with the courts and abusing their processes; it is
improper conduct that tends to degrade the administration of justice.
Thus, the said rule has been formalized in Section 17 of the Interim
Rules and Guidelines issued by this Court on 11 January 1983 in
connection with the implementation of the Judiciary Reorganization Act
(Batas Pambansa Blg. 129). A review of the cases on forum-shopping
reveals, however, that they involve parties filing two (2) or more suits in
different forums. 63 The rule has not been extended to a defendant
who, for reasons known only to him, commences a new action against

the plaintiff instead of filing a responsive pleading in the other case

setting forth therein, as causes of action, specific denials, special and
affirmative defenses or even counterclaims. Thus, Velhagen's and King's
motion to dismiss Civil Case No. 91-2069 by no means negates the
charge of forum-shopping as such did not exist in the first place. prLL
IN VIEW OF THE FOREGOING, the instant petition is hereby GRANTED.
The Order of respondent Court of 16 September 1991 dismissing Civil
Case No. 91-2069 is SET ASIDE and a new one is entered DISMISSING
instead, on ground of lis pendens, Civil Case No. 91-2192 of Branch 150
of the Regional Trial Court of Makati, with costs against the defendants
therein. The Order of respondent Court of 22 January 1992 in Civil Case
No. 91-2069 is hereby MODIFIED by setting aside that portion thereof
denying the motion to reconsider its Order of 16 September 1991 and
declaring that portion denying the motion for consolidation as moot and
academic.
Cost against private respondents.
SO ORDERED.
Gutierrez, Jr., Bidin, Romero and Melo, JJ ., concur.

THIRD DIVISION
[G.R. No. 28883. June 3, 1992.]
LOURDES
G.
SUNTAY,
plaintiff-appellant,
vs.
HEROICO M. AGUILUZ, ET AL., defendants-appellees.
SYLLABUS
1.REMEDIAL LAW; CIVIL PROCEDURE; MOTION TO DISMISS; LIS
PENDENS AS A GROUND; REQUISITES. The requisites of lis pendens
as a ground for dismissal of a complaint are: (1) there must be the
same parties or at least such as to represent the same interest; (2)
there must be the same rights asserted and the same relief prayed for,
which relief must be founded on the same facts and the title or
essential basis of the relief sought must be the same; (3) the identity in
these particulars should be such that if the pending case had already
been disposed of, it would be pleaded in bar as a former adjudication of
the same matter between the same parties.
2.ID.; ID.; ID.; ID.; ID.; NOT PRESENT IN CASE AT BAR. Civil Case No.
Q-10313, although cleverly denominated as one for specific
performance with mandatory and prohibitory injunction, is in reality
principally one for injunction to prevent the foreclosure of the mortgage
and to fix a new period to pay the remaining unpaid balance of
P40,000.00 which was to be paid on or before 6 August 1966 without
any need for a demand. Upon the other hand, Civil Case No. Q-10343 is
a suit for specific performance which asks for the payment of the
balance and the liquidated damages and foreclosure of the mortgage.
The causes of action and the reliefs sought are entirely different. A
decision in the first will not amount to res judicata against the second
case for whether or not defendants prevail in the former, petitioner's
right to the unpaid balance and the foreclosure of the mortgage would
still be litigable.

not a pending prior action. The fact that the unlawful detainer suit was
of a later date is no bar to the dismissal of the present action." Plaintiff
then had all the right to file the motion to dismiss Civil Case No. Q10313. Unfortunately, however, while she actually filed such a motion,
she failed to invoke lis pendens; she merely raised: (a) unenforceability
of the demands under the statute of frauds and (b) lack of cause of
action as grounds for the motion. Thus, the same was denied by the
trial court on 7 December 1966.
4.ID.; ID.; CONSOLIDATION OF ACTION; RULE; CASE AT BAR. The trial
court, therefore, committed an error in dismissing Civil Case No. Q10343. What it should have done was to order its consolidation, for joint
hearing and trial, with Civil Case No. Q-10313 pursuant to Section 1,
Rule 31 of the Rules of Court. As ruled by this Court in Ramos vs.
Ebarle: (182 SCRA 245 [1990]) ". . . And, whatever difficulties or
inconvenience may be entailed if both causes of action are pursued on
separate remedies, the proper solution is not the dismissal order of the
trial court. The possible consolidation of said cases, as well as
stipulations and appropriate modes of discovery, may well be
considered by the court below to subserve not only procedural
expedience but, more important, the ends of justice."
DECISION
DAVIDE, JR., J p:
This is an appeal, on a pure question of law, from the Orders of 7
January 1967 and 26 September 1967 of Branch IX (Quezon City) of the
then Court of First Instance (now Regional Trial Court) of Rizal in Civil
Case No. Q-10343 which respectively dismissed said case on the
ground of pendency of another action, Civil Case No. Q-10313, entitled
Heroico M. Aguiluz, et al. vs. Lourdes G. Suntay, and denied the motion
for its reconsideration.
The antecedent facts are not disputed.

3.ID.; ID.; ID.; ID.; REQUIRES A PENDING ACTION AND NOT A PENDING
PRIOR ACTION. To the mind of this Court, if any case should be
dismissed at all, it should be Civil Case No. Q-10313. That this case was
filed ahead of the other is of no moment for, as this Court held in
Teodoro vs. Mirasol: (99 Phil. 150 [1956]) "It is to be noted that the
Rules do not require as a ground for dismissal of a complaint that there
is a prior pending action. They provide that there is a pending action,

On 9 June 1966, plaintiff and defendants executed a Deed of Sale with

Real Estate Mortgage under which the former sold to the latter Lot 12,
Block S-38 of the Diliman Estate Subdivision located in the District of
Diliman, Quezon City, containing an area of 441 square meters, and
more particularly described in Transfer Certificate of Title No. 82529 of

the Registry of Deeds of Quezon City, subject to the following

conditions: LLphil
"WHEREFORE, for and in consideration of the sum of
SIXTY THOUSAND (P60,000.00) PESOS, Philippine
Currency, the VENDOR-MORTGAGEE hereby transfers,
sells and conveys to the VENDEE-MORTGAGOR the
above-described parcel of land together with all the
improvements existing thereon subject to the following
terms and conditions:
1.That
the
VENDOR-MORTGAGEE
acknowledges having receipt (sic) the sum of
TWENTY THOUSAND (P20,000.00) PESOS as
partial payment and the VENDEE-MORTGAGOR
hereby binds himself to pay the balance of
FORTY THOUSAND (P40,000.00) PESOS on or
before August 6, 1966, without need of any
demand;
2.That failure on the part of the VENDEEMORTGAGOR to pay the balance of the purchase
price in the sum of FORTY THOUSAND
(P40,000.00) PESOS in full on the agreed date,
the VENDEE-MORTGAGOR shall pay to the
VENDOR-MORTGAGEE
the
sum
of
TEN
THOUSAND (P10,000.00) PESOS as liquidated
damages.
And to secure unto the VENDOR-MORTGAGEE the due
and punctual payment of the balance of the purchase
price of FORTY THOUSAND (P40,000.00) PESOS in
accordance with the terms herein agreed upon, the
VENDEE-MORTGAGOR hereby constitutes in favor of the
said VENDOR-MORTGAGEE a valid and voluntary first
mortgage upon the property subject of this Deed of
Sale with Real Estate mortgage;
And the conditions of this mortgage is (sic) such that if
the VENDEE-MORTGAGOR, his heirs, successors and
assigns shall faithfully comply with the terms agreed
upon by the parties as contained in this instrument,

then this mortgage shall have no further force or effect;

otherwise, the said mortgage shall remain binding;
That if at any time the VENDEE-MORTGAGOR fail (sic) to
comply with the terms and conditions herein stipulated,
the VENDOR-MORTGAGEE may at her discretion declare
the mortgage defaulted and immediately foreclose this
mortgage judicially or extra-judicially under Act No.
3135, as amended by Act No. 4119, and in case of
foreclosure, the VENDOR-MORTGAGEE on filing the
corresponding petition shall be appointed receiver
without any bond, and the said VENDOR-MORTGAGEE
shall at once take charge of the mortgaged property
and to (sic) hold possession of the same, and the rents
and profits derived from the mortgaged property before
the sale, less the costs of expenses of the receivership,
the expenses of collection and attorney's fees, which
shall be TWENTY FIVE (25%) PER CENT of the total
indebtedness, but which shall not be less than FIVE
THOUSAND (P5,000.00) PESOS exclusive of all costs
and fees allowed by law, shall be applied first to the
payment of interests and then to the capital of the
indebtedness secured herein and such rents and profits
that may be obtained after the sale will belong to the
bidder to whom the property shall have been
adjudicated;
That all the expenses in connection with the
registration of this instrument, attorney's fee for the
preparation of this document and all other expenses to
effect the transfer of the above-mentioned Transfer
Certificate of Title to the VENDEE-MORTGAGOR shall be
for his exclusive account.
That during the existence of this mortgage the VENDEEMORTGAGOR shall insure the building in the
abovementioned parcel of land in the amount of FORTY
THOUSAND (P40,000.00) PESOS against all insurable
risks with a reputable insurance Company to be chosen
by the VENDOR-MORTGAGEE and the policy shall be
endorsed to the VENDOR-MORTGAGEE;" 1

Defendants failed to pay the P40,000.00 on due date, 6 August 1966.

Plaintiff demanded payment and threatened to foreclose the mortgage.
On 9 August 1966, defendants filed a complaint against herein plaintiff
for specific performance with preliminary mandatory and prohibitory
injunction with the then Court of First Instance of Rizal, which was
docketed as Civil Case No. Q-10313. They allege therein that upon the
execution of the contract, the parties agreed that herein plaintiff would
simultaneously deliver to the defendants the certificate of title and the
tax declaration of the lot, the latest realty tax receipt, lot plan and
vicinity map and building permit for the existing building; the
defendants repeatedly made it known to the plaintiff that in order to
fully pay the balance of the purchase price, the former needed to obtain
a loan from the Social Security System (SSS) or any other lending
institution, thus necessitating the transfer of the property in their
names; for no justifiable reason and despite repeated demands, plaintiff
refused to turn over to them the above documents, resulting in the
delay in the filing of an application for a housing loan with the SSS;
even if the application had been processed, however, the proceeds of
the loan cannot be released until the certificate of title is surrendered to
them and a new certificate of title is issued to them; plaintiff has
threatened to foreclose the mortgage, immediately take possession of
the property as receiver and enforce the penalty clause of the contract,
which would cause them irreparable injury; if the foreclosure and/or
receivership proceedings are initiated by herein plaintiff, their loan
application would be disapproved by the SSS; and that it is essential
that the court fix a reasonable period, to commence on the date the
certificate of title is delivered to them, within which they may comply
with their obligation to pay the unpaid balance of P40,000.00 of the
purchase price. They pray that: (a) a writ of preliminary mandatory and
prohibitory injunction be issued ordering the plaintiff to surrender the
certificate of title and enjoining her or her representative from, inter
alia, proceeding with the threatened foreclosure of the mortgage,
respective; and (b) after trial, judgment be rendered making the
injunction permanent, fixing a reasonable period, from the date of
delivery of the certificate of title, within which they may comply with
their above obligation and awarding to them attorney's fees, exemplary
damages and costs. 2

On the day the above complaint was filed, the court 3 issued an Order
setting the hearing for the application for injunction on 20 August 1966,
and directing the parties to maintain the status quo in the meantime.
On 18 August 1966, before being served with summons, a copy of the
complaint in Civil Case No. Q-10313 and a copy of the above Order,
herein plaintiff filed with the same court a complaint for recovery of the
unpaid balance of the purchase price, the penalty provided for in the
contract and foreclosure of the mortgage. The complaint was docketed
as Civil Case No. Q-10343 and was raffled to another branch of the
court. In said complaint, plaintiff prays for: (a) judgment ordering the
defendants to pay her the amount of P50,000.00 (P40,000.00
representing the unpaid balance and P10,000.00 representing the
liquidated damages) with legal interest from the date of the filing of the
complaint until the same is fully paid and a sum equivalent to 25%
thereof as attorney's fees, plus certain sums as attorney's fees for the
preparation of the document, documentary stamps and registration
fees, and decreeing the foreclosure of the mortgage and sale of the
property in a public auction; and (b) an Order appointing her, during the
pendency of the action, as receiver of the property. 4
Plaintiff subsequently received the summons and a copy of the
complaint in Civil Case No. Q-10313 on 20 August 1966. 5
On 2 September 1966, defendants filed a motion to dismiss plaintiff's
Civil Case No. Q-10343 on the following grounds: LLpr
"1.That there is another action pending between the
same parties for the same cause;
2.That the complaint states no cause of action." 6
The other action referred to is Civil Case No. Q-10313.
On 13 September 1966, defendants filed a Supplemental Complaint. 7
On 17 September 1966, plaintiff filed an Opposition to the motion to
dismiss 8 alleging therein that the two (2) complaints are not for the
same cause of action. While Civil Case No. Q-10313 prays for: (a) the
issuance of a mandatory and prohibitory injunction to compel her to
deliver the certificate of title and to prevent her from foreclosing the
mortgage, and (b) the fixing of a period within which herein defendants
will pay the balance of the purchase price of the property, Civil Case No.

Q-10343 is an action for foreclosure of mortgage. She further alleges

that her complaint states a valid cause of action as defendants failed to
pay the balance of the purchase price on due date.
On 7 January 1967, the trial court issued an Order dismissing Civil Case
No. Q-10343 on the ground of pendency of another action "between the
same parties for specific performance of the very contract subject of
this suit for foreclosure, and it appearing that the issue raised in this
present action can well and should be litigated in the suit for specific
performance." 9
Her motion for reconsideration 10 having been denied by the trial court
in its Order of 26 September 1967, 11 plaintiff filed her notice of appeal
on 21 October 1967, 12 deposited a case appeal bond 13 and filed a
record on appeal which was approved on 12 March 1968.
In her Brief, plaintiff makes the following assignment of errors:
"I
The lower court erred in holding that there is pending
an action between the same parties for specific
performance of the very contract subject of this suit for
foreclosure, and it appearing further that the issues
raised in this present action can well and should be
litigated in the suit for specific performance.
II
The lower court erred in dismissing the complaint."
Defendants did not file their Appellee's Brief despite three (3)
extensions of time granted by this Court. 14 Hence, this Court
considered this case submitted for decision without the Appellee's Brief.
15
The appeal is meritorious.
As could be gathered from the body of the complaint, Civil Case No. Q10313 is an action for injunction filed in anticipation of the foreclosure
of the mortgage which plaintiff had threatened to pursue if defendants
failed to pay the unpaid balance of P40,000.00 on due date. The
contract explicitly provides that said balance shall be paid "on or before

August 6, 1966 without need of any demand." Defendants' self-serving

characterization thereof as an action for "specific performance" is
calculated to obfuscate the issues and mislead the trial court. As this
Court sees it, defendants herein merely tried to beat the plaintiff to the
draw 16 and pre-empt the latter's legal moves.
The other causes of action in Civil Case No. Q-10313 are but mere
embellishments to give a semblance of viability to the alleged
grievance of herein defendants. The contract fails to indicate that (a) it
was the intention of the parties to consider the delivery of the
certificate of title and the other documents mentioned therein as a
condition precedent before the balance of P40,000.00 would be paid or
(b) such delivery constitutes a suspensive condition the non-fulfillment
of which prevents the obligation of defendants to pay said balance from
arising. 17 On the contrary, as earlier alluded to, defendants
unqualifiedly bound themselves to pay the balance on or before 6
August 1966 without need of any demand. Besides, since under the
contract the property was mortgaged to the plaintiff as security for the
payment of the unpaid balance of P40,000.00, plaintiff, as mortgagee,
was entitled to possession of the certificate of title. The filing then of
Civil Case No. Q-10313 was a clever ruse to avoid compliance with
defendants' obligation. Even if it were not so, lis pendens does not
apply in this case. The requisites of lis pendens as a ground for
dismissal of a complaint are: (1) there must be the same parties or at
least such as to represent the same interest; (2) there must be the
same rights asserted and the same relief prayed for, which relief must
be founded on the same facts and the title or essential basis of the
relief sought must be the same; (3) the identity in these particulars
should be such that if the pending case had already been disposed of, it
would be pleaded in bar as a former adjudication of the same matter
between the same parties. 18
While concededly, the first requisite obtains in this case, the last two
are conspicuously absent. As earlier discussed, Civil Case No. Q-10313,
although cleverly denominated as one for specific performance with
mandatory and prohibitory injunction, is in reality principally one for
injunction to prevent the foreclosure of the mortgage and to fix a new
period to pay the remaining unpaid balance of P40,000.00 which was to
be paid on or before 6 August 1966 without any need for a demand.
Upon the other hand, Civil Case No. Q-10343 is a suit for specific
performance which asks for the payment of the balance and the
liquidated damages and foreclosure of the mortgage. The causes of
action and the reliefs sought are entirely different. A decision in the first

will not amount to res judicata against the second case for whether or
not defendants prevail in the former, petitioner's right to the unpaid
balance and the foreclosure of the mortgage would still be litigable.
prcd

it be jointly heard and tried with Civil Case No. Q-10313, if that would
still be feasible.

To the mind of this Court, if any case should be dismissed at all, it

should be Civil Case No. Q-10313. That this case was filed ahead of the
other is of no moment for, as this Court held in Teodoro vs. Mirasol: 19

SO ORDERED.

"It is to be noted that the Rules do not require as a

ground for dismissal of a complaint that there is a prior
pending action. They provide that there is a pending
action, not a pending prior action. The fact that the
unlawful detainer suit was of a later date is no bar to
the dismissal of the present action."
Plaintiff then had all the right to file the motion to dismiss Civil Case No.
Q-10313. Unfortunately, however, while she actually filed such a
motion, she failed to invoke lis pendens; she merely raised: (a)
unenforceability of the demands under the statute of frauds and (b)
lack of cause of action 20 as grounds for the motion. Thus, the same
was denied by the trial court on 7 December 1966. 21
The trial court, therefore, committed an error in dismissing Civil Case
No. Q-10343. What it should have done was to order its consolidation,
for joint hearing and trial, with Civil Case No. Q-10313 pursuant to
Section 1, Rule 31 of the Rules of Court. As ruled by this Court in Ramos
vs. Ebarle: 22
". . . And, whatever difficulties or inconvenience may be
entailed if both causes of action are pursued on
separate remedies, the proper solution is not the
dismissal order of the trial court. The possible
consolidation of said cases, as well as stipulations and
appropriate modes of discovery, may well be
considered by the court below to subserve not only
procedural expedience but, more important, the ends of
justice."
WHEREFORE, judgment is hereby rendered REVERSING and SETTING
ASIDE the challenged Orders of 7 January 1967 and 26 September 1967
in Civil Case No. Q-10343; REINSTATING said case; and ORDERING that

Costs against defendants-appellees.

Gutierrez, Jr., Feliciano, Bidin and Romero, JJ., concur.

SECOND DIVISION

petitioners decided to file the action below. Clearly, the petitioners'

action is now barred by the statute of limitations.

[G.R. No. L-39047. April 30, 1985.]

ALBERTO PASCUA, CRISPINA PASCUA, SOTERA
PASCUA, and EDUARDO MOLINA, petitioners, vs.
HON. ALFREDO C. FLORENDO, CFI of Cagayan,
CLEMENTE CASTRO, and JULIANA O. CASTRO,
respondents.
Hermenigildo G. Rapanan for petitioner.

3.CIVIL LAW; ACTION FOR RELIEF BASED ON FRAUD; ACTION BROUGHT

WITHIN FOUR YEARS FROM DISCOVERY OF FRAUD. Even if we add the
lower court's finding that there was fraud on the part of Martin Pascua
when he effected the sale of the disputed lot in favor of the
respondents, the petitioners are still barred from recovering the lot
because their action should have been filed within four (4) years from
their discovery of the fraud, which in turn, is deemed at the latest to
have taken place in 1958, when the respondents were issued an
original certificate of title.

SYLLABUS
1.REMEDIAL LAW; CIVIL PROCEDURE; PREVIOUS DENIAL OF MOTION TO
DISMISS; TRIAL COURT NOT ESTOPPED FROM PASSING UPON ISSUE OF
PRESCRIPTION. The trial court denied the motion to dismiss because
the grounds relied upon by the respondents for their motion did not
appear on the face of the complaint. There was no finding that the
allegation of prescription had no merit. It cannot be said, therefore, that
the trial court was already stopped from passing upon the issue of
prescription. The issue was not adjudicated on its merits and the
doctrine of res judicata had not set in yet.
2.ID.; ID.; ACTION; BARRED BY STATUTE OF LIMITATIONS; CASE AT BAR.
We likewise find the petitioners' contention, that they came to know
of the deed of sale by Martin Pascua in favor of the respondents only in
1973, highly improbable. As the trial court correctly observed, it is
inconceivable that the petitioners did not come to know about the
purchase by the respondents of the property from Martin Pascua. They
admitted that they have been neighbors of the respondents since
before the war or for a period of about 30 years and that the latter had
deprived them of the fruits of the land in question for more than 20
years. Alberto Pascua, one of the petitioners testified that his parents
from whom they inherited the property died more than 25 years ago yet
the children never exerted any effort to have the property partitioned.
This fact indicates that petitioners had knowledge of the sale, which
explains why they had no interest at all in any project of partition. More
important is the fact that after the respondents purchased the land they
worked to secure an Original Certificate of Title on the basis of a free
patent application. This was way back in 1958, 15 years before the

4.REMEDIAL LAW; CIVIL PROCEDURE; JUDGMENT BY DEFAULT

PREVAILING PARTY NOT AUTOMATICALLY ENTITLED TO RELIEF; CASE AT
BAR. Nowhere in the aforequoted provision nor in the summons
issued by the respondent court is it stated that the petitioners are
automatically entitled to the relief prayed for, once the respondents are
declared in default. Favorable relief can be granted only after the court
has ascertained that the evidence offered and the facts proven by the
presenting party, petitioners in this case, warrant the grant of the
same. Otherwise, it would be meaningless to require presentation of
evidence if everytime the other party is declared in default, a decision
would automatically be rendered in favor of the non-defaulting party
and exactly according to the tenor of his prayer. This is not
contemplated by the Rules nor is it sanctioned by the due process
clause. In the instant case, from the evidence presented ex-parte by the
petitioners and from their very own allegations, the only judgment that
is warranted is the dismissal of the complaint. It is barred by the statute
of limitations.
DECISION
GUTIERREZ, JR., J p:
This is a petition for review on certiorari, seeking to annul the decision
of the Court of First Instance of Cagayan which dismissed the
petitioners' action for reconveyance with damages on the ground that
the period within which to file the same had already prescribed.
Petitioners, as plaintiffs, filed a complaint for reconveyance with
damages against the private respondents, spouses Clemente and

Juliana Castro. The latter, as defendants, in lieu of filing an answer, filed

a motion to dismiss the complaint on the grounds that the complaint
states no cause of action and that the same is already barred by the
statute of limitations.
The trial court denied the respondents' motion after finding that the
grounds relied upon by them did not appear on the face of the
complaint. The court subsequently declared the respondents in default
for their having failed to file an answer within the reglementary period.
Thus, the petitioners proceeded to present their evidence ex-parte.
After receiving the petitioners' evidence, the trial court made the
following findings:
"From the evidence adduced during the presentation of
evidence by plaintiffs, it was shown that Alberto Pascua
is one of the plaintiffs, in this case; that he knows his
co-plaintiffs Crispina, Sotera, surnamed Pascua, and
Eduardo Molina, the first two being his sisters while the
last is his nephew being the son of his sister Alejandra;
that his father is Jordan Pascua while his mother is
Magdalena Dumadag; that both his parents are already
dead (Exhibits A, B, and C); that Alejandra Pascua is
also dead; that during the lifetime of Jordan and
Magdalena Dumadag, they begot five children, namely
Alberto, Alejandra, Crispina, Martin and Sotera; that
Jordan Pascua and Magdalena Dumadag acquired a
parcel of land located at Dacalafugo, Camalaniugan,
Cagayan, consisting of 1.02.20 hectares and described
in paragraph 3 of the complaint; that lately they came
to know that their brother Martin Pascua sold the
property to Clemente
Castro, a resident of
Camalaniugan, Cagayan; that when they went to
complain to the Agrarian office in Tuguegarao,
Clemente Castro showed them the deed of sale which
they xerox copied (Exhibit D); that the signature Alberto
Pascua appearing in Exhibit D is not his signature; that
the genuine signature of Alberto Pascua appears in
Exhibit E; that he and his co- plaintiffs did not give
consent to the sale of the land subject matter of this
case; that the signature Sotera Pascua, appearing in
Exhibit D is not also the signature of Sotera Pascua;
that he and his co-plaintiffs did not appear before the

Notary Public; that the land subject matter of this case

was never given to Martin Pascua by their deceased
father; that Martin Pascua is already dead; that the land
is now titled in the name of the defendant Juliana O.
Castro (Exhibits F and F-1) while the deed of sale was
executed in favor of Clemente Castro (Exhibit D); that
the land is declared for taxation purposes under Tax
Declaration No. 157 (Exhibit G) in the name of Juliana
Castro; that plaintiffs and the defendants have been
neighbors since before the war and defendants know
that the land sold to them and subject matter of this
suit was inherited by the plaintiffs from their deceased
father; that they (plaintiffs) have been deprived of the
fruits of the land for more than 20 years; that the land
yields from thirty to forty sacks of palay valued at
P30.00 each; and that plaintiffs agreed to pay their
counsel the amount of P1,200.00 out of which they
have already paid P200.00.
"From. Exhibit D of the plaintiffs, it appears that the
deed of sale was executed in favor of the defendant
Clemente Castro married to Juliana Orteza by Martirs
Pascua on May 8, 1951. Alberto Pascua and Sotera
Pascua testified that lately they came to know that this
land was conveyed by Martin Pascua to the defendants
and that said defendants have been in possession of
the land in question for more than 20 years. They
testified further, however, that they have been
deprived of the fruits of the land for more than twenty
years. If such is the case, it is clear that the defendants
have entered and occupied the property for more than
twenty years and it is inconceivable that the plaintiffs
did not come to know that the defendants bought the
property from their brother Martin Pascua when they
admitted that they have suffered damages by virtue of
the dispossession for more than twenty years. The
conclusion is obvious that the plaintiffs had knowledge
of the transaction made by their brother about twenty
years ago.
"From the evidence of the plaintiffs, the Court finds that
there was really fraud committed by Martin Pascua in
selling the entire property which said Martin Pascua and

plaintiffs inherited from their parents thus excluding the

shares of the plaintiffs. Certainly, Martin Pascua could
only sell one-fifth of the property and that the four-fifths
were fraudulently conveyed by him. It is clear that
there was fraud on the part of Martin Pascua in selling
the shares of his brother and sisters. The action for
relief on the ground of fraud, however, may be brought
only within four years from the discovery of the fraud.
(Article 1391, New Civil Code; Section 43 (c) Act 190).

case on the same ground. Petitioners further contend that the court's
conclusion that they had knowledge of the sale executed by their
deceased brother, Martin Pascua about twenty years ago is based
merely on surmises and conjectures because, in reality, it was only in
1973 when they came to learn of the deed of sale executed by their
deceased brother in 1951. In 1973, the deed was shown to them by
respondent Clemente Castro at the Agrarian office. Therefore, the
period of prescription should be counted from the knowledge of the
petitioners of the deed of sale and not from the date it was executed.
LLpr

xxx xxx xxx

Petitioners' contention are without merit.
"In view of the fact that the deed of sale was executed
on May 8, 1951, or over twenty years before the filing
of the complaint on May 31, 1973, it is hard to believe
that plaintiffs did not come to know of this deed of sale
executed by their brother. The Court, therefore, comes
to the inevitable conclusion that this action, having
been filed 22 years after the execution of the deed of
sale, has long prescribed."
Not satisfied with the trial court's decision, petitioners elevated the
case to this Court through this petition. The petitioners ask us to
examine the following alleged errors of the respondent court: LLjur
1.THE TRIAL COURT ERRED IN DISMISSING THE CASE
ON GROUND OF PRESCRIPTION ALTHOUGH IT HAS
PREVIOUSLY DENIED A MOTION TO DISMISS BASED ON
THE SAME GROUND.
2.THE TRIAL COURT ERRED IN NOT GRANTING RELIEF
TO PLAINTIFFS ALTHOUGH THE DEFENDANTS WERE
DECLARED IN DEFAULT.

The petitioners contend that the trial court acted with grave abuse of
discretion when, after hearing their evidence presented ex-parte, the
respondents having been declared in default, it dismissed the case on
the ground that the action had already prescribed. When the same
ground was earlier raised, the court denied the motion to dismiss filed
by the respondents. The petitioners argue that because of its denying
the motion to dismiss, the trial court is stopped from dismissing the

The trial court denied the motion to dismiss because the grounds relied
upon by the respondents for their motion did not appear on the face of
the complaint. There was no finding that the allegation of prescription
had no merit. It cannot be said, therefore, that the trial court was
already stopped from passing upon the issue of prescription. The issue
was not adjudicated on its merits and the doctrine of res judicata had
not set in yet.
We likewise find the petitioners' contention, that they came to know of
the deed of sale by Martin Pascua in favor of the respondents only in
1973, highly improbable. As the trial court correctly observed, it is
inconceivable that the petitioners did not come to know about the
purchase by the respondents of the property from Martin Pascua. They
admitted that they have been neighbors of the respondents since
before the war or for a period of about 30 years and that the latter had
deprived them of the fruits of the land in question for more than 20
years. Alberto Pascua, one of the petitioners testified that his parents
from whom they inherited the property died more than 25 years ago yet
the children never exerted any effort to have the property partitioned.
This fact indicates that petitioners had knowledge of the sale, which
explains why they had no interest at all in any project of partition. More
important is the fact that after the respondents purchased the land they
worked to secure an Original Certificate of Title on the basis of a free
patent application. This was way back in 1958, 15 years before the
petitioners decided to file the action below. Clearly, the petitioners'
action is now barred by the statute of limitations.
In the case of Iglesia ni Cristo v. Hon. Judge, Court of First Instance of
Nueva Ecija, Br. I (123 SCRA 523), quoting the case of Labora v.
Dayang-hirang (37 SCRA 346), we ruled:

"The rule in this jurisdiction, regarding public patents

and the character of the certificate of title that may be
issued by virtue thereof, is that where land is granted
by the government to a private individual, the
corresponding patent therefor, is recorded and the
certificate of title is issued to the grantee; thereafter,
the land is automatically brought within the operation
of the Land Registration Act, the title issued to the
grantee becoming entitled to all the safeguards
provided in Section 38 of said Act. In other words, upon
the expiration of one year from its issuance, the
certificate of title becomes irrevocable and indefeasible
like a certificate issued in a registration proceeding."
It is quite obvious, therefore, that the respondents' title has already
become indefeasible and irrevocable, the one-year period provided by
law having expired in 1959.
Moreover, even if we add the lower court's finding that there was fraud
on the part of Martin Pascua when he effected the sale of the disputed
lot in favor of the respondents, the petitioners are still barred from
recovering the lot because their action should have been filed within
four (4) years from their discovery of the fraud, which in turn, is
deemed at the latest to have taken place in 1958, when the
respondents were issued an original certificate of title. This was our
ruling in the case of Balbin v. Medalla (108 SCRA 666) where we stated:
llcd
"An action for reconveyance of real property resulting
from fraud may be barred by the statute of limitations,
which requires that the action shall be filed within four
(4) years from the discovery of the fraud. Such
discovery is deemed to have taken place when the
petitioners herein were issued original certificates of
title through either homestead or free patent grants, for
the registration of said patents constitutes constructive
notice to the whole world. (Gerona v. de Guzman, 11
SCRA 153, and cited cases thereof).
"In the case at bar, the latest patent war issued on
October 14, 1959. There is, therefore, merit in
petitioners's contention that if any action for
reconveyance should be commenced, the same should

be filed on or before October 14, 1963. But private

respondents'
complaint
for
reconveyance
and
annulment of titles with damages was filed only on
August 30, 1973 or more than 14 years had already
elapsed from the date of the issuance of the respective
titles of the defendants. Consequently, the action for
reconveyance of land titled in the names of defendants
(petitioners herein) had already prescribed."
The petitioners raise as a second issue that the respondent court had
no alternative but to grant the relief prayed for in their complaint as this
was evident in the tenor of the summons issued by said court which in
part stated:
". . . if you fail to appear within the time aforesaid,
the plaintiff will take judgment against you by
default and demand from this Court the relief
applied for in said complaint . . ."
Petitioners also anchor their contention on Rule 18, Section 1 of the
Rules of Court which provides:
"Judgment by default. If the defendant fails to
answer within the time specified in these roles, the
court shall, upon motion of the plaintiff and proof of
such failure, declare the defendant in default.
Thereupon the court shall proceed to receive the
plaintiff's evidence and render judgment granting him
such relief as the complaint and the facts proven may
warrant. This provision applies where no answer is
made to a counter-claim, cross-claim or third-party
complaint within the period provided in this Rule."
Nowhere in the aforequoted provision nor in the summons issued by the
respondent court is it stated that the petitioners are automatically
entitled to the relief prayed for, once the respondents are declared in
default.
Favorable relief can be granted only after the court has ascertained that
the evidence offered and the facts proven by the presenting party,
petitioners in this case, warrant the grant of the same. Otherwise, it
would be meaningless to require presentation of evidence if everytime
the other party is declared in default, a decision would automatically be

rendered in favor of the non-defaulting party and exactly according to

the tenor of his prayer. This is not contemplated by the Rules nor is it
sanctioned by the due process clause. prLL
In the case of Lim Tanhu v. Ramolete (66 SCRA 452-453), we had
occasion to elaborate on this point. We ruled:
"The Rules of Court contain a separate rule on the
subject of default, Rule 18. But said rule is concerned
solely with default resulting from failure of the
defendant or defendants to answer within the
reglementary period. Referring to the simplest form of
default, that is, where there is only one defendant in
the action and he fails to answer on time, Section l of
the rule provides that upon 'proof of such failure, (the
court shall) declare the defendant in default. Thereupon
the court shall proceed to receive the plaintiff's
evidence and render judgment granting him such relief
as the complaint and the facts proven may warrant.'
This last clause is clarified by Section 5 which says that
'a judgment entered against a party in default shall not
exceed the amount or be different in kind from that
prayed for.'
"Unequivocal, in the literal sense, as these provisions
are, they do not readily convey the full import of what
they contemplate. To begin with, contrary to the
immediate notion that can be drawn from their
language, these provisions are not to be understood as
meaning that default or the failure of the defendant to
answer should be 'interpreted as an admission by the
said defendant that the plaintiff's cause of action find
support in the law or that plaintiff is entitled to the relief
prayed for.' (Moran, supra, p. 535 citing Macondray &
Co. v. Eustaquio, 64 Phil. 466. citing with approval
Chaffin v. Mc Fadden, 41 Ark. 42; Johnson v. Pierce, 12
Ark. 599; Mayden v. Johnson, 59 Ga. 105; People v.
Rust, 292 Ill. 328; Ken v. Leopold, 21 Ill. A. 163; Chicago,
etc. Electric R. Co. v. Krempel, 116 Ill. A. 253.)
xxx xxx xxx

"In other words, a defaulted defendant is not actually

thrown out of court. While in a sense it may be said that
by defaulting he leaves himself at the mercy of the
court, the rules see to it that any judgment against him
must be in accordance with law. The evidence to
support the plaintiffs cause is, of course, presented in
his absence, but the court is not supposed to admit that
which is basically incompetent. Although the defendant
would not be in a position to object, elementary justice
requires that only legal evidence should be considered
against him. If the evidence presented should not be
sufficient to justify a judgment for the plaintiff, the
complaint must be dismissed. And if an unfavorable
judgment should be justifiable, it cannot exceed in
amount or be different in kind from what is prayed for
in the complaint."

In the instant case, from the evidence presented ex-parte by the

petitioners and from their very own allegations, the only judgment that
is warranted is the dismissal of the complaint. It is barred by the statute
of limitations.
WHEREFORE, the petition is hereby DISMISSED for lack of merit. No
costs.
SO ORDERED.
Teehankee (Chairman), Melencio-Herrera, Plana, Relova, De la Fuente
and Alampay, JJ., concur.

SECOND DIVISION
[G.R. No. L-49833. February 15, 1990.]
JUANITO RAMOS, SALVADOR RAMOS, ESPERIDION
RAMOS, LYDIA RAMOS and AGAPITA VDA. DE RAMOS,
petitioners, vs. HON. BIENVENIDO A. EBARLE, Judge,
Court of First Instance of Misamis Occidental, Branch
II, and SPOUSES BERTOLO HINOG and DELA PAZ
CORTES, respondents.
Dominador B. Borje for petitioners.
Jorge C. Paderanga for private respondents.
SYLLABUS
1.REMEDIAL LAW; CIVIL PROCEDURE; JUDGMENT; LITIS PENDENTIA,
REQUISITES. Under the rules and jurisprudence, for litis pendentia to
be invoked as a ground for the dismissal of an action, the concurrence
of the following requisites is necessary: (a) Identity of parties or at least
such as represent the same interest in both actions; (b) Identity of
rights asserted and relief prayed for, the relief being founded on the
same facts; and (c) The identity in the two cases should be such that
the judgment that may be rendered in one would, regardless of which
party is successful, amount to res judicata in the other.
2.ID.; ID.; ID.; ID.; NO LITIS PENDENTIA IN CASE AT BAR. The rights
asserted in each of the cases involved are separate and distinct; there
are two subjects of controversy presented for adjudication. Also, two
causes of action are clearly involved. Civil Case No. OZ 642 is for
annulment of an instrument and recovery of possession and ownership
of the one-half (1/2) share of the widow in the conjugal partnership
properties. The alienation and transfer thereof to private respondents
without the knowledge and consent of said widow is the actionable
wrong. This cause of action properly pertains to the widow, Agapita
Manisan, who is the real aggrieved party and, therefore, the real party
in interest. Thus, the participation of the other petitioners in the case in
that particular regard is not even necessary and they should not have
been impleaded therein. On other hand, the real parties in interest in
the second action, Civil Case No. OZ 731, not only include the widow
but all the heirs of Manuel Ramos. The case is anchored on the alleged

fraudulent acts employed by private respondents in securing Transfer

Certificate of Title No. 300 although the deed purporting to be a sale
was actually intended only as a mortgage. Necessarily, the real parties
in interest and the cause of action are not the same. Furthermore, the
subject matter affected by said cause of action is the entire deed and,
consequently, the entire parcel of land and not merely a part or half
thereof.
3.ID.; ID.; ID.; ID.; WHILE A DECISION IN ONE CASE MAY AFFECT THE
OTHER CASE IDENTITY OR DISCRETENESS OF THE CAUSES OF ACTION
IS NOT DETERMINED BY IT. It necessarily follows from the above
disquisition that the third requisite for litis pendentia is also not present.
There being different causes of action, the decision in one case will not
constitute res judicata as to the other. Thus, a finding that there was no
fraud in executing a deed of sale instead of a mortgage will not be res
judicata as to the question of whether or not the widow consented to or
participated in the transaction. Of course, a decision in one case may,
to a certain extent, affect the other case as they involve the same
parcel of land. This, however, is not the test to determine the identity or
discreteness of the causes of action.
4.ID.; ID.; ID.; ID.; ID.; DIFFICULTIES OR INCONVENIENCE IN PURSUING
CAUSES OF ACTION BY SEPARATE REMEDIES DO NOT JUSTIFY
DISMISSAL. Whatever difficulties or inconvenience may be entailed if
both causes of action are pursued on separate remedies, the proper
solution is not the dismissal order of the trial court. The possible
consolidation of said cases, as well as stipulations and appropriate
modes of discovery, may well be considered by the court below to
subserve not only procedural expedience but, more important, the ends
of justice.
DECISION
REGALADO, J p:
Petitioners pray in this original action for the writs of certiorari and
mandamus primarily for the annulment of the orders of respondent
judge, dated October 11, 1978 and November 18, 1978, issued in Civil
Case No. OZ 731 of the then Court of First Instance of Misamis
Occidental.

Petitioners are the heirs of the deceased Manuel Ramos, namely, his
widow, Agapita Vda. de Ramos, and their children, Juanito, Salvador,
Esperidion and Lydia. The records reveal that on May 26, 1977, they
filed a complaint docketed as Civil Case No. OZ 642 in the same trial
court earlier referred to. This complaint was later amended, as a matter
of right, before answer thereto was filed. In both their original and
amended complaints, petitioners prayed that the "Deed of Absolute
Sale of Real Properties" executed by Manuel Ramos on February 16,
1960 in favor of respondent spouses be declared null and void, but
"only in connection with the alleged participation therein of plaintiff
Agapita Manisan Vda. de Ramos," one of the petitioners herein.
Additionally, petitioners prayed for the cancellation of Transfer
Certificate of Title No. 300 of the Register of Deeds of Misamis
Occidental issued by virtue of the aforementioned deed, and for them
to be declared" to be the rightful owner (sic) of 23.0000 hectares, more
or less, out of the 46.0000 hectares, as the plaintiffs does (sic) not
question the legal effect of such transactions of their late father as the
rightful owner of the one-half under consideration." 1
On May 22, 1978, petitioners moved for the admission of a second
amended complaint. This time, petitioners likewise sought the
annulment of the same deed of sale but focused the allegations of said
amended complaint on the alleged mistake and fraud that made the
document defective. Petitioners alleged that although the contract was
designated as a sale, the intention was actually to mortgage the
properties. Petitioners claimed therein that they are in possession of the
properties and have been in possession of the same since time
immemorial. On the basis of those allegations, petitioners sought to
recover title to the entire parcel of land in question. 2
In its order dated June 9, 1978, the motion to admit the second
amended complaint was denied by the trial court. It pointed out that:
". . . in the original and first amended complaint,
plaintiffs were only claiming 23 hectares of land, this
being the share of Agapita Manisan in the conjugal land
containing a total area of 46 hectares which was sold
by her husband, Manuel Ramos (deceased), to the
defendants. Both complaints further alleged that they
were not questioning the ownership of Manuel Ramos
as to the half portion conveyed, hence, the sale was
valid insofar as the 23 hectares was (sic) concerned.
However, the 2nd amended complaint now changed

these allegations claiming the whole parcel of 46

hectares alleging practically new matters therein." 3
A motion for reconsideration of this order, filed on June 19, 1978, was
denied by the trial court on June 1, 1978 holding that the second
amended complaint would substantially alter the cause of action of the
case." 4
On July 24, 1978, petitioner instituted Civil Case No. OZ 731 copying
and embodying the same allegations in the rejected second amended
complaint in Civil Case No. OZ 642. 5 However, instead of being
designated as an action for "annulment of instrument and/or legal
redemption" like the aforesaid second amended complaint, the case
was now denominated as one for "reconveyance and/or legal
redemption." llcd
Private respondents moved to dismiss the second case on three
grounds, that is, (1) that there is another action pending between the
same parties for the same cause; (2) that there was no cause of action;
and (3) that the action was already barred by laches and/or
prescription. 6 Despite an opposition thereto, the trial dismissed the
complaint in Civil Case No. OZ 731 on October 11, 1978 on the ground
of litis pendentia. The court ruled that:
". . . any judgment that may be rendered in Civil Case
No. 642, regardless of which party may be successful,
would amount to res adjudicata in this case under
consideration. From the allegations of both complaints,
the cause of action of the plaintiffs is premised solely
on the invalidity of the instrument of sale although they
have availed of different remedies one for
reconveyance and the other for annulment. Perforce,
these remedies emanate from a single cause of action
which under our rules cannot be resorted to by splitting
the cause of action to be the basis for filing a separate
complaint. Whatever judgment may be rendered on the
document in question would finally settle the issue of
validity amounting to res adjudicata of the case at bar.
What plaintiffs failed to get by the denial of their
second amended complaint in Civil Case No. OZ 642,
they are now pursuing this instant case to seek the
same relief in the prior case." 7

From the foregoing factual antecedents, the sole question to be

resolved in the present recourse is whether or not the trial court was
correct in dismissing Civil Case No. OZ 731 on the ground of litis
pendentia.

a mortgage. Necessarily, the real parties in interest and the cause of

action are not the same. Furthermore, the subject matter affected by
said cause of action is the entire deed and, consequently, the entire
parcel of land and not merely a part or half thereof.

Under the rules and jurisprudence, for litis pendentia to be invoked as a

ground for the dismissal of an action, the concurrence of the following
requisites is necessary: (a) Identity of parties or at least such as
represent the same interest in both actions; (b) Identity of rights
asserted and relief prayed for, the relief being founded on the same
facts; and (c) The identity in the two cases should be such that the
judgment that may be rendered in one would, regardless of which party
is successful, amount to res judicata in the other. 8

Concededly, some items or pieces of evidence may be admissible in

both actions. It cannot be said, however, that exactly the same
evidence will support the decisions in both. It is evident that the legally
significant and controlling facts in each case are entirely different. In
the first case, what is material and determinative, as alleged and to be
proved, is the lack of consent of the widow in the document in question;
in the other, it is the alleged mistake of fraud in the execution of the
instrument and the obtention of title by respondents pursuant thereto.
LLjur

Petitioners assert herein that there could be no litis pendentia because

the two cases involved distinct halves of the forty-six (46) hectares of
land. They claim that the dismissal of Civil Case No. OZ 723 on that
ground is inconsistent with the lower court's refusal to admit the second
amended complaint in Civil Case No. OZ 642. These arguments, as
formulated, appear to be strained and inconclusive. Nevertheless, we
rule in petitioners' favor as, properly considered, there is merit in their
position. prLL

The rights asserted in each of the cases involved are separate and
distinct; there are two subjects of controversy presented for
adjudication. Also, two causes of action are clearly involved. Civil Case
No. OZ 642 is for annulment of an instrument and recovery of
possession and ownership of the one-half (1/2) share of the widow in
the conjugal partnership properties. The alienation and transfer thereof
to private respondents without the knowledge and consent of said
widow is the actionable wrong. This cause of action properly pertains to
the widow, Agapita Manisan, who is the real aggrieved party and,
therefore, the real party in interest. Thus, the participation of the other
petitioners in the case in that particular regard is not even necessary
and they should not have been impleaded therein.

It necessarily follows from the above disquisition that the third requisite
for litis pendentia is also not present. There being different causes of
action, the decision in one case will not constitute res judicata as to the
other. Thus, a finding that there was no fraud in executing a deed of
sale instead of a mortgage will not be res judicata as to the question of
whether or not the widow consented to or participated in the
transaction. Of course, a decision in one case may, to a certain extent,
affect the other case as they involve the same parcel of land. This,
however, is not the test to determine the identity or discreteness of the
causes of action. And, whatever difficulties or inconvenience may be
entailed if both causes of action are pursued on separate remedies, the
proper solution is not the dismissal order of the trial court. The possible
consolidation of said cases, as well as stipulations and appropriate
modes of discovery, may well be considered by the court below to
subserve not only procedural expedience but, more important, the ends
of justice.
ON THE FOREGOING CONSIDERATIONS, the writ of certiorari is hereby
issued SETTING ASIDE the questioned orders, dated October 11, 1978
and November 18, 1978, issued in Civil Case No. OZ 731 by respondent
judge.
SO ORDERED.

On other hand, the real parties in interest in the second action, Civil
Case No. OZ 731, not only include the widow but all the heirs of Manuel
Ramos. The case is anchored on the alleged fraudulent acts employed
by private respondents in securing Transfer Certificate of Title No. 300
although the deed purporting to be a sale was actually intended only as

Melencio-Herrera, Paras, Padilla and Sarmiento, JJ., concur.

SECOND DIVISION
[G.R. No. L-30523. April 22, 1977.]
LEE BUN TING and ANG CHIA, petitioners, vs. HON.
JOSE A. ALIGAEN, Judge of the Court of First
Instance of Capiz, 11th Judicial District, Branch II;
ATTY. ANTONIO D. AMOSIN, as court-appointed
Receiver; RAFAEL A. DINGLASAN, FRANCISCO A.
DINGLASAN, CARMEN A. DINGLASAN, RAMON A.
DINGLASAN, LOURDES A. DINGLASAN, MERCEDES
A. DINGLASAN, CONCEPCION A. DINGLASAN,
MARIANO A. DINGLASAN, JOSE A. DINGLASAN,
LORETO A. DINGLASAN, RIZAL A. DINGLASAN,
JIMMY DINGLASAN, and JESSE DINGLASAN,
respondents.
Norberto J. Quisumbing and Humberto V. Quisumbing for
petitioners.
Rafael A. Dinglasan for respondents.
DECISION
ANTONIO, J p:
Petition for certiorari to annul the Orders of respondent court dated
October 10, 1968 and November 9, 1968 and other related Orders in
Civil Case No. V-3064, entitled "Rafael A. Dinglasan, et al. vs. Lee Bun
Ting, et al.", with prayer for the issuance of a writ of preliminary
injunction. The antecedent facts are as follows:
On June 27, 1956, this Court rendered judgment in G. R. No. L-5996,
entitled "Rafel Dinglasan, et al. vs. Lee Bun Ting, et al." 1 In that case,
We found that:
"In the month of March, 1936, petitioners-appellants
sold to Lee Liong, a Chinese citizen, predecessor in
interest of respondents-appellees, a parcel of land
situated on the corner of Roxas Avenue and Pavia
Street, Capiz (now Roxas City), Capiz, designated as lot
398 and covered by Original Certificate of Title No.

3389. The cost was P6,000.00 and soon after the sale
Lee Liong constructed thereon a concrete building
which he used as a place for his lumber business and in
part as residence for himself and family. Petitioners had
contended that the sale was a conditional sale, or one
with the right of repurchase during the last years of a
ten-year period, but booth the trial court and the Court
of Appeals found that the sale was an absolute one.
Another contention of the petitioners-appellants is that
the sale is null and void as it was made in violation of
the provision contained in the Constitution (Article XIII,
section 5), but the Court of Appeals found that the
purchaser was not aware of the constitutional
prohibition while petitioners-appellants were because
the negotiations for the sale were conducted with the
knowledge and direct intervention of Judge Rafael
Dinglasan, one of the plaintiffs, who was at that time an
assistant attorney in the Department of Justice. . . ."(p.
429).
In reply to the contention of appellants therein that as the sale to Lee
Liong is prohibited by the Constitution, title to the land did not pass to
said alien because the sale did not produce any juridical effect in his
favor, and that the constitutional prohibition should be deemed selfexecuting in character in order to give effect to the constitutional
mandate, this Court said:
". . . In answer we state that granting the sale to be null
and void and can not give title to the vendee, it does
not necessarily follow therefrom that the title remained
in the vendor, who had also violated the constitutional
prohibition, or that he (vendor) has the right to recover
the title of which he has divested himself by his act in
ignoring the prohibition. In such contingency another
principle of law sets in to bar to equally guilty vendor
from recovering the title which he had voluntarily
conveyed for a consideration, that of pari delicto. We
have applied this principle as a bar to the present
action in a series of cases, thus:
xxxxxxxxx

'We can, therefore, say that even if the

plaintiffs can still invoke the Constitution, or the
doctrine in the Krivenko case, to set aside the
sale in question, they are now prevented from
doing so if their purpose is to recover the lands
that they have voluntarily parted with, because
of their guilty knowledge that what they were
doing was in violation of the Constitution. They
cannot escape the law. As this Court well said: A
party to an illegal contract cannot come into a
court of law and ask to have his illegal objects
carried out. The law will not aid either party to
an illegal agreement; it leaves the parties where
it finds them. The rule is expressed in the
maxims: 'Ex dolo malo non oritur actio', and 'In
pari delicto potior est conditio defendentis.'. . . .
'

"There is one other cause why petitioners' remedy

cannot be entertained, that is the prescription of the
action. As the sale occurred in March, 1936, more than
ten years had already elapsed from the time the cause
of action accrued when the action was filed (1948)."
(pp. 431-432).
Noting the absence of policy governing lands sold to aliens in violation
of the constitutional prohibition, We further said:
"We take this occasion to call the attention of the
legislature to the absence of a law or policy on sales in
violation of the Constitution; this Court would have
filled the void were we not aware of the fact that the
matter falls beyond the scope of our authority and
properly belongs to a co-ordinate power." (P. 432).
Accordingly, the petition in the foregoing case was denied.

"It is not necessary for us to re-examine the doctrine

laid down by us in the above cases. We must add in
justification of the adoption of the doctrine that the
scope of our power and authority is to interpret the law
merely, leaving to the proper co-ordinate body the
function of laying down the policy that should be
followed in relation to conveyances in violation of the
constitutional prohibition and in implementing said
policy. The situation of these prohibited conveyances is
not different from that of homestead sold within five
years from and after the issuance of the patent,
(Section 118, C.A. 141, otherwise known as the Public
Land Law), for which situation the legislature has
adopted the policy, not of returning the homestead sold
to the original homesteader, but of forfeiting the
homestead and returning it to the public domain again
subject to disposition in accordance with law. (Section
124, Id.).
"The doctrine of in pari delicto bars petitionersappellants from recovering the title to the property in
question and renders unnecessary the consideration of
the other arguments presented in appellants' brief.

Twelve (12) years later, on the basis of the decision of this Court in
Philippine Banking Corporation vs. Lui She, 2 private respondents Rafael
A. Dinglasan, et al. filed a complaint on July 1, 1968 for the recovery of
the same parcel of land subject matter of the first-mentioned case. Said
complaint was docketed as Civil Case No. V-3064 before respondent
court. Private respondents (plaintiffs before the court a quo) reiterated
their contention that the sale made to Lee Liong, predecessor-ininterest of petitioners (defendants a quo), was null and void for being
violative of the Constitution, and prayed that plaintiffs be declared as
the rightful and legal owners of the property in question; that
defendants be ordered to vacate the premises, to surrender possession
thereof to plaintiffs and to receive the amount of P6,000.00 from the
plaintiffs as restitution of the purchase price; and that defendants be
ordered to pay damages to the plaintiffs in the amount of P2,000.000 a
month from the time of the filing of the complaint until the property is
returned to them, as well as the costs of suit.
A motion to dismiss, dated September 23, 1968, was filed by
defendants-petitioners on the ground of res judicata, alleging that the
decision in the case of "Rafael Dinglasan, et al. vs. Lee Bun Ting, et al.",
supra, promulgated on June 27, 1956, has definitely settled the issues
between the parties. An opposition thereto was filed by plaintiffs, with
the averment that the decision in the prior case "cannot be pleaded in
bar of the instant action because of new or additional facts or grounds

of recovery and because of change of law or jurisprudence." 3 In

support of the change in Jurisprudence asserted, the decision of this
Court in Philippine Banking Corporation vs. Lui She, supra, was
advanced, upon the contention that said decision warrants a reopening
of the case and the return of the parcel of land involved to the plaintiffs.
A reply to the opposition was filed by defendants by registered mail on
October 16, 1968, alleging that the decision in Philippine Banking
Corporation vs. Lui She, which was promulgated in 1967, "cannot affect
the outcome of the instant case. Said 1967 decision cannot be applied
to the instant case where there had been already a final and conclusive
determination some twelve years earlier. While a doctrine laid down in
previous cases may be overruled, the previous cases themselves
cannot thereby be reopened. The doctrine may be changed for future
cases but it cannot reach back into the past and overturn finally settled
cases." 4
However, on October 10, 1968, before the filing of the above reply,
respondent court had issued an Order denying the motion to dismiss.
The court said:
"A copy of the decision rendered in the case of Rafael
Dinglasan, et al. vs. Lee Bun Ting, et al., G. R. No. L5996 is attached to the motion to dismiss.
"In that case, the Supreme Court ruled that both parties
violated the constitutional prohibition (Article XIII, sec.
9) for the purchaser was an alien and prohibited to
acquire residential lot while the vendors, Filipino
citizens, can not also recover the property for having
violated the constitutional prohibition, under the
principle of pari delicto. The vendee cannot own the
property, neither can the vendor recover what he sold.
"To fill the void, the Supreme Court pointed out that the
coordinate body Congress of the Philippines can
pass remedial legislation.

"But Congress failed to act. Neither was there any

proceeding after almost twenty years for escheat or
reversion instituted by the Office of the Solicitor
General after the Krivenko decision which prohibits the
transfer to aliens of any private agricultural land
including residential lands whatever its origin might
have been.

"But the Supreme Court took a decisive step and in bold

relief dispelled darkening clouds in the case of
Philippine
Banking
Corporations
vs.
Lui
She,
promulgated September 12, 1967, . . . .
"The concurring opinion of Justice Fernando is very
enlightening and elucidating. . . . .
"The Court wishes to refer to the concurring opinion of
Justice Fernando as an additional authority supporting
the herein order.
"PREMISES CONSIDERED, the Court finds the motion to
dismiss unmeritorious and holds that the same he as it
is hereby DENIED." 5
A motion for reconsideration of the foregoing Order was filed by
defendants, alleging that their reply to plaintiffs' opposition to the
motion to dismiss was not even considered by the court a quo because
the Order was issued before said reply could reach the court. Further, it
was asserted that the Philippine Banking Corporation vs. Lui She case
had the effect of annulling and setting aside only the contracts subject
matter thereof "and no other contracts, certainly not contracts outside
the issues in said judgment as that in the instant case", and of ordering
the return only of the lands involved in said case, and not the land
subject of the present action. Moreover, it was averred that "Nowhere in
the majority opinion nor in the concurring opinion in said decision of
Philippine Banking Corporation vs. Lui She does there appear any
statement which would have the effect of reopening and changing
previously adjudicated rights of parties and finally settled cases" and
that the principle enunciated in such case "should apply after, not on or
before, September 12, 1967". The motion for reconsideration was found
to have not been well taken and, consequently, was denied by

respondent court on November 9, 1968. Defendants were given ten

(10) days from receipt of the Order within which to file their answer to
the complaint, which defendants complied with.
Defendants' answer, dated December 5, 1968, contained the following
allegations, among others:
"(a)The sale of the parcel of land involved was made in
1935 before the promulgation of the Constitution.
"(b)Said conveyance was an absolute sale, not subject
to any right or repurchase . . .
"(c)Upon the purchase of the said parcel of land by the
deceased Lee Liong, he and defendant Ang Chia
constructed thereon a camarin for lumber business and
later a two-storey five door accessoria with an assessed
valuation of P35,000.00, which said improvements were
destroyed during the Japanese entry into the
municipality of Capiz in April 1942; thereafter, the same
improvements were rebuilt.
"(d)In July 1947, the said Lee Liong being already
deceased, defendants as his legal heirs entered into an
extrajudicial settlement of said property, there being no
creditors or other heirs, and by virtue of said
extrajudicial settlement, approximately two-thirds of
said property was adjudicated to defendant Ang Chia
and Lee Bing Hoo as co-owners and the remaining onethird to defendant Lee Bun Ting.
"(e)The deceased Lee Liong and defendants have been
declaring and paying real estate taxes on the said
property since 1935 and up to the present year.
xxxxxxxxx

In addition to the foregoing, defendants reiterated their defense of res

judicata, on the basis of the decision of the Supreme Court of June 27,
1956. It was, therefore, prayed that the complaint be dismissed, with
counterclaim for attorney's fees and expenses of litigation or, in case of
adverse judgment, that plaintiffs be ordered to pay the reasonable
equivalent of the value of the property at the time of the restoration,
plus reimbursement of improvements thereon.
A reply and answer to the counterclaim, dated December 14, 1968, was
filed by plaintiffs. On March 31, 1969, respondent court issued an Order
denying a motion filed by petitioners for simplification of the issues and
for the striking out from the records of the declaration of Rafael
Dinglasan under the Survivorship Disqualification Rule. A motion for
reconsideration of the foregoing Order was denied on May 7, 1969.
During the pendency of the trial, plaintiffs filed a petition for the
appointment of a receiver "to receive, collect and hold in trust all
income of the property in the form of monthly rentals of P2,000.00", on
the premise that defendants have no other visible property which will
answer for the payment of said rentals. This petition was opposed by
defendants, alleging that plaintiffs will not suffer any irreparable injury
or grave damage if the petition for receivership is not granted,
particularly as defendants are solvent, and further considering that
defendants have a building on the parcel of land, the value of which
must likewise be considered before plaintiffs can be awarded
possession of the land. The matter of receivership was heard by
respondent court and on May 17, 1969, it issued an Order appointing
respondent Atty. Antonio D. Amosin, Deputy Clerk of Court, as receiver,
with instructions to take immediate possession of the property in
litigation and to preserve, administer and dispose of the same in
accordance with law and order of the court, upon the posting of a bond
in the amount of P500.00. On May 17, 1969, the appointed receiver
took his oath. Hence, the instant petition.
Petitioners herein pray that judgment be rendered annulling and setting
aside respondent court's complained of Orders dated October 10, 1968.
November 9, 1968, March 31, 1969, May 7, 1969 and May 17, 1969,
and ordering the dismissal of Civil Case no. V-3064 of respondent court
on the ground of res judicata. Petitioners further prayed for the
issuance of a writ of preliminary injunction to restrain respondent court
from proceeding with the scheduled hearings of the case, and
respondent receiver from executing the order to take immediate
possession of the property in litigation.

On June 16, 1969, this Court issued the writ of preliminary injunction
prayed for, restraining respondent court from continuing with the
scheduled trial of the case and respondent receiver from executing the
order to take immediate possession of the property in litigation and/or
otherwise discharging or performing his function as receiver. LexLib
The issue posed before Us is whether the questions which were decided
in Rafael Dinglasan, et al. vs. Lee Bun Ting, et al., supra, could still be
relitigated in Civil Case No. V-3064, in view of the subsequent decision
of this Court in Philippine Banking Corporation vs. Lui She, supra.
We resolve the issue in the negative. The decision of this Court in G. R.
No. L-5996, "Rafael Dinglasan, et al. vs. Lee Bun Ting, et al." constitutes
a bar to Civil Case No. V-3064 before the respondent court. Said Civil
case, therefore, should have been dismissed because it is a mere
relitigation of the same issues previously adjudged with finality, way
back in 1956, between the same parties or their privies and concerning
the same subject matter. We have consistently held that the doctrine of
res judicata applies where, between a pending action and one which
has been finally and definitely settled, there is identity of parties,
subject matter and cause of action.
The concept of res judicata as a "bar by prior judgment" was explained
in Comilang vs. Court of Appeals, et al., promulgated on July 15, 1975, 6
thus:
"'The fundamental principle upon which
the doctrine of res judicata rests is that parties
ought not to be permitted to litigate the same
issue more than once; that, when a right or fact
has been juridically tried and determined by a
court
of
competent
jurisdiction,
or
an
opportunity for such trial has been given, the
judgment of the court, so long as is remains
unreversed, should he conclusive upon the
parties and those in privity with them in law or
estate. . . . .

'(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 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 was actually and
necessarily included therein or necessary
thereto.'
"Sec. 49(b) enunciates that concept of res judicata
known as 'bar by prior judgment' while Sec. 49(c) refers
to 'Conclusiveness of judgment.' There is 'bar by prior
judgment' when, between the first case where the
judgment was rendered and the second case which is
sought to be barred, there is identity of parties, subject
matter and cause of action. The judgment in the first
case constitutes an absolute bar to the subsequent
action. It is final as to the claim or demand in
controversy, including the parties and those in privity
with them, not only as to every matter which was
offered and received to sustain or defeat the claim or
demand, but as to any other admissible matter which
might have been offered for that purpose and of all
matters that could have been adjudged in that case.
But where between the first and second cases, there is
identity of parties but no identity or cause of action, the
first judgment is conclusive in the second case, only as
to those matters actually and directly controverted and
determined and not as to matters merely involved
therein." (pp. 76-78).

xxxxxxxxx
"This principle of res judicata is embodied in Rule 39,
Sec. 49(b) and (c) of the Rules of Court, as follows:

A comparison between the earlier case of "Rafael Dinglasan, et al. vs.

Lee Bun Ting, et al." (G. R. No. L-5996) and the case pending before
respondent court 7 reveals that the requisites for the application of the
doctrine of res judicata are present. It is undisputed that the first case

was tried and decided by a court of competent jurisdiction, whose

decision was affirmed on appeal by this Tribunal. The parties to the two
cases are substantially the same, namely, as plaintiffs, Rafael A.
Dinglasan, Carmen A. Dinglasan, Francisco A. Dinglasan, Jr., Ramon A.
Dinglasan, Lourdes A. Dinglasan, Mercedes A. Dinglasan, Concepcion A.
Dinglasan, Mariano A. Dinglasan, Jose A. Dinglasan, Loreto A. Dinglasan,
Manuel A. Dinglasan, Rizal A. Dinglasan and Jimmy Dinglasan (the
differences being the inclusions of the minor Vicente Dinglasan in L5996 and Jesse Dinglasan in the case before respondent court), against
defendants Lee Bun Ting and Ang Chia, in her capacity as widow of the
deceased Lee Liong (and Administratrix of his estate in L-5996). The
subject matter of the two actions are the same, namely, that "parcel of
land, Cadastral Lot No. 398, located at Trece de Agosto Street, now
Roxas Avenue, corner of Pavia St., in the municipality of Capiz, now
Roxas City, covered by Original Certificate of Title No. 3389 of the Office
of Register of Deeds of Capiz in the name of . . . Francisco Dinglasan
and originally declared under Tax (Declaration) No. 19284 also in his
name in the municipality of Capiz, but now declared as Cadastral Lots
Nos. 398-A and 398-B respectively under Tax Declarations Nos. 7487
and 7490 in the City of Roxas in the names of Ang Chia Vda. de Lee and
Lee Bun Ting respectively . . ." The causes of action and the reliefs
prayed
for
are
identical the annulment of the sale and the recovery of the subject
parcel of land.

Notwithstanding the mode of action taken by private respondents, We

find that in the ultimate analysis, Civil Case No. V-3064 is but an
attempt to reopen the issues which were resolved in the previous case.
Contrary to the contentions of private respondents, there has been no
change in the facts or in the conditions of the parties. Neither do We
find Our ruling in the Philippine Banking Corporation case applicable to
the case at bar, considering the rule that posterior changes in the
doctrine of this Court cannot retroactively be applied to nullify a prior
final ruling in the same proceeding where the prior adjudication was
had, whether the case should he civil or criminal in nature. The
determination of the questions of fact and of law by this Court on June
27, 1956 in case No. L-5996 has become the law of the case, and may
not now be disputed or relitigated by a reopening of the same questions
in a subsequent litigation between the same parties and their privies
over the same subject matter. Thus, in People vs. Olarte, 8 We
explained this doctrine, as follows: prcd

"Suffice it to say that our ruling in Case L-13027,

rendered on the first appeal, constitutes the law of the
case, and, even if erroneous, it may no longer be
disturbed or modified since it has become final long
ago. A subsequent reinterpretation of the law may be
applied to new cases but certainly not to an old one
finally and conclusively determined (People v. Pinuila,
G. R. No. L-11374, May 30, 1958; 55 O.G. 4228).
"Law of the case' has been defined as the
opinion delivered on a former appeal. More
specifically, it means that whatever is once
irrevocably established as the controlling legal
rule of decision between the same parties in the
same case continues to be the law of the case,
whether correct on general principles or not, so
long as the facts on which such decision was
predicated continue to be the facts of the case
before the court. (21 C.J.S. 330). (cited in Pinuila
case, supra).
'As a general rule a decision on a prior
appeal of the same case is held to be the law of
the case whether that decision is right or wrong,
the remedy of the Party being to seek a
rehearing. (5 C.J.S. 1277).' (also cited in Pinuila
case).
It is also aptly held in another case that:
'It need not be stated that the Supreme
Court, being the court of last resort, is the final
arbiter of all legal questions properly brought
before it and that its decision in any given case
constitutes the law of that particular case. Once
its judgment becomes final it is binding on all
inferior courts, and hence beyond their power
and authority to alter or modify.' (Kabigting vs.
Acting Director of Prisons, G. R. No. L-15548,
October 30, 1962).

"More categorical still is the pronouncement of this

Court in Pomeroy vs. Director of Prisons, L-14284-85,
February 24, 1960:
'It will be seen that the prisoner's stand
assumes that doctrines and rulings of the
Supreme Court operate retrospectively, and that
they can claim the benefit of decisions in People
vs. Hernandez; People vs. Geronimo, and People
vs. Dugonon (L-6025-26, July 18, 1956; L-8936,
Oct. 31, 1956; and L-8926, June 29, 1957,
respectively), promulgated four or more years
after the prisoner applicants had been convicted
by final judgment and started serving sentence.
However, the rule adopted by this Court (and by
the Federal Supreme Court) is that judicial
doctrines have only prospective operation and
do not apply to cases previously decided (People
vs. Pinuila, L-11374, promulgated May 30, 1958)'
"In the foregoing decision, furthermore, this Court
quoted and reiterated the rule in the following excerpts
from People vs. Pinuila, G.R. No. L-11374, jam cit.:
"The decision of this Court on that appeal
by the government from the order of dismissal,
holding that said appeal did not place the
appellants, including Absalong Bignay, in double
jeopardy, signed and concurred in by six justices
as against three dissenters headed by the Chief
Justice, promulgated way back in the year 1952,
has long become the law of the case. It may be
erroneous, judge by the law on double jeopardy
as recently interpreted by this same Tribunal.
Even so, it may not be disturbed and modified.
Our recent interpretation of the law may he
applied to new cases, but certainly not to an old
one finally and conclusively determined. As
already stated, the majority opinion in that
appeal is now the law of the case."

"The same principle, the immutability of the law of the

case notwithstanding subsequent changes of judicial
opinion, has been followed in civil cases:
Fernando vs. Crisostomo, 90 Phil.
585; Padilla vs. Paterno, 93 Phil.
884; Samahang Magsasaka, Inc. vs.
Chua Guan, L-7252, February, 1955.
"It is thus clear that posterior changes in the doctrine of
this Court can not retroactively he applied to nullify a
prior final ruling in the same proceeding where the prior
adjudication was had, whether the case should be civil
or criminal in nature." 9
Reasons of public policy, judicial orderliness, economy and judicial time
and the interests of litigants, as well as the peace and order of society,
all require that stability be accorded the solemn and final judgments of
the courts or tribunals of competent jurisdiction. There can be no
question that such reasons apply with greater force on final judgments
of the highest Court of the land. Cdpr
WHEREFORE, certiorari is granted, the Orders complained of are hereby
annulled and set aside, and respondent Judge is directed to issue an
Order dismissing Civil Case No. V-3064. With costs against private
respondents.
Barredo, Aquino and Concepcion Jr., JJ., concur.
Castro, C.J., concurs in the result.
Fernando, J., took no part.

EN BANC
[G.R. No. L-16463. January 30, 1965.]
PHILIPPINE NATIONAL BANK, plaintiff-appellants, vs.
HERMOGENES HIPOLITO and LEONOR JUNSAY,
defendants-appellees.
Ramon B. de los Reyes for plaintiff-appellant.
P. A. Palanca for defendants-appellees.
SYLLABUS
1.PLEADINGS AND PRACTICE; MOTION TO DISMISS ADMITS TRUTH OF
ALLEGATIONS OF COMPLAINT. In a motion to dismiss defendant
hypothetically admits the truth of the allegations of fact contained in
the complaint.
2.ID.; ID.; DENIAL OF ALLEGATIONS OF COMPLAINT NOT PROPER IN A
MOTION TO DISMISS. A denial of an allegation of a complaint, as for
example the denial of an offer of payment which would prevent
prescription from setting in, would be proper in the answer to the
complaint but not in a motion for dismissal, for the contradictory
allegations would require presentation of evidence.
3.PRESCRIPTION; RENEWAL OF OBLIGATION BY OFFER OF PAYMENT.
An offer of payment works as a renewal of the obligation and prevents
prescription from setting in.
DECISION
MAKALINTAL, J p:
Appeal from the order of dismissal by the Court of First
Instance of Negros Occidental.
The complaint, filed on June 18, 1959, allege that defendants obtained
various sugar crop loans from plaintiff through its Victorias Branch,
evidenced by promissory notes (reproduced as annexes to the
complaint) respectively dated January 25, 1941, February 13, 1941,
March 8, 1941, April 3, 1941, May 2, 1941 and June 23, 1941; that of

the total amount of P9,692.00 represented by said notes defendants

paid P3,905.61, leaving a balance of P6,786.39, which, added to
accrued interest of P5,213.34, summed up to P11,999.73 as of January
17, 1957; that despite repeated demands, defendants failed and
refused to pay said amount; that in view of such demands defendants,
on May 7, 1957, went to Attorney Francis I. Medel of the legal
department of plaintiff's Victorias branch and offered a plan of payment
of the account, but for reasons unknown to plaintiff and probably due to
the transfer of defendant Hipolito as supervising teacher to some other
province, his proposed plan of payment did not materialize; that said
offer of plan of payment was an acknowledgment of defendants' just
and valid obligation. The prayer is for the court to order defendants to
pay to plaintiff the said amount of P11,999.73, with accrued annual
interest thereon at the rate of 5% from January 17, 1957 up to the date
of payment, plus attorney's fees equivalent to 10%.
Defendants move for a bill of particulars, but the motion was denied.
They then moved to dismiss on the ground that plaintiff's cause of
action, if any, had already prescribed. To the motion they attached a
joint affidavit of merit, wherein they averred that they never made any
acknowledgment of indebtedness nor offered a plan of payment, but on
the contrary had always maintained that plaintiff's action had
prescribed.
Plaintiff opposed the motion, contending that the prescriptive period
had been suspended by "Executive Order No. 32, otherwise known as
the Moratorium Law," and interrupted, pursuant to Article 1973 of the
old Civil Code, by plaintiff's written extra-judicial demands as well as by
defendants' acknowledgment of the indebtedness. Attached to the
opposition were (1) a statement of defendants' account dated July 22,
1947; (2) plaintiffs' letter dated October 31, 1953, asking defendants to
make arrangements for the liquidation of the debt (3) letter of plaintiffs'
Victorias Branch Manager, dated February 4, 1959, addressed to
defendant Hipolito (at Iloilo City) requesting him to settle his account,
otherwise drastic action would be taken against him as a government
employee, and reminding him of his May 7, 1957 interview with Branch
Attorney Medel, wherein he proposed a plan of payment which however
did not materialize; and (4) defendant Hipolito's answer dated February
16, 1959, requesting said Manager, in his personal and not in his official
capacity, to be more "sensitive" to the financial plight of defendants;
and requesting further that he or any of his investigators study the case
by seeing Mrs. Hipolito (who was then staying very near the Victorias

Branch Office) about "the actual insolvency of the family," ending up

with an appeal for help "in this matter."
Defendants replied to plaintiff's opposition, stating among other things
that Executive Order No. 32, if at all, suspended the prescriptive period
"only for two (2) years, four (4) months and sixteen (16) days, from
March 10, 1945, or only up to July 26, 1948," citing Bachrach Motors
Co., Inc. vs. Chua Tia Hian, 53 O.G. 6524; that the alleged written
extrajudicial demands constitute self-serving evidence; and that
defendant Hipolito's letter of February 16, 1959 can not be considered
as an acknowledgment of indebtedness.
In dismissing the complaint the lower court ruled that since the seven
promissory notes constituted one single obligation, arising as it did from
plaintiff's financiation of defendants' sugar crop for 1941-42, the date of
the last promissory note, June 23, 1941, should be considered as the
true date of the written contract, from which the ten year prescriptive
period (Art. 1144, par. 1 of the new Civil Code) started; that said period
was suspended only for two (2) years, four (4) months and sixteen (16)
days (by reason of Executive Order No. 32) until said Order was
declared unconstitutional; that prescription set in on November 8, 1953,
five (5) years, five (5) months and ten (10) days before the complaint
was filed on June 18, 1959; that the alleged letters of demand cannot
be considered as extrajudicial demands "under Art. 1155 of the Civil
Code" because there is no proof that defendants received them; that
plaintiff's letter of demand of February 4, 1959, which was admittedly
received by defendant Hipolito, did not work to interrupt the
prescriptive period which had already previously elapsed; and that
defendant Hipolito's answering letter of February 16, 1959 does not
contain any express or tacit acknowledgment of the obligation nor
promise to pay the same and hence did not renew the obligation.
We are of the opinion that the dismissal of the complaint is erroneous.
In a motion to dismiss defendant hypothetically admits the truth of the
allegations of fact contained in the complaint. (Pangan vs. Evening
News Publishing Co., Inc., L-13308, Dec. 29, 1960; Pascual vs. Secretary
of Public Works and Communications, L-10405, Dec. 29, 1960; Republic
vs. Ramos, L-15484, Jan. 31, 1963).

An examination of the complaint herein does not indicate clearly that

prescription has set in. On the contrary, it is belied by the allegation
concerning defendant's offer of payment made on May 7, 1957. Such
offer hypothetically admitted in the motion, worked as a renewal of the
obligation.
It is true that defendants attached to the motion a joint affidavit of
merit wherein they deny having made an offer of a plan of payment.
Such denial, however, being a contrary averment of fact, would be
proper in the answer to the complaint but not in a motion for dismissal,
for the contradictory allegations would require presentation of evidence
(Alquigue vs. De Leon, L-15059, March 30, 1963). The same is true of
the other allegations in the complaint concerning, the demands for
payment sent by plaintiff upon defendants and the partial payments
made by them, all or some of which may have a material bearing on the
question of prescription. In other words, the ground for dismissal not
being indubitable, the lower court should have deferred determination
of the issue until after trial of the case on the merits. (Sec. 3, Rule 16,
Revised Rules of Court; Geganto vs. Katalbas, L-17105, July 31, 1963).
The order appealed from is set aside and the case is remanded to the
lower court for further proceedings, with costs against appellees.
Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera, Paredes, Dizon,
Regala, Bengzon, J. P. and Zaldivar, JJ., concur.
Concepcion, J., took no part.

SECOND DIVISION
[G.R. No. L-18137. August 31, 1963.]
ROSELLER T. LIM, ET AL., plaintiffs-appellants, vs.
PACITA DE LOS SANTOS, ET AL., defendantsappellees.
Lim & Alvarez for plaintiffs-appellants.
Estanislao A. Fernandez and Ricardo G. Bernardo, Jr. for defendantsappellees.
SYLLABUS
1.PLEADING AND PRACTICE; MOTION TO DISMISS; BASED ON FAILURE
TO STATE A CLAUSE OF ACTION; FACTS AVERRED IN COMPLAINT
DEEMED ADMITTED. It is elementary that a motion to dismiss based
on failure to state a cause of action should be deemed to have admitted
the truth of the facts averred in the complaint. (Ruperto vs. Fernando,
83 Phil. 943.)
2.ID.; ID.; ID.; TAKING OF EVIDENCE OF MOTION FOR RECONSIDERATION
OF ORDER OF DISMISSAL, IRREGULAR. The taking of evidence upon
the motion for reconsideration of the order of dismissal is an irregular
procedure not authorized by the rules, since it is precisely in the case of
a motion to dismiss for failure to state a cause of action where no
evidence may be alleged or considered to test the sufficiency of the
complaint except the very facts pleaded therein; and in the event, the
judge may not, before a hearing is had on the merits of the case,
inquire into the truth of the allegations and find them to be false.
3.ID.; ID.; ID.; ID.; PAROL EVIDENCE RULE NOT APPLICABLE. The parol
evidence rule is one of evidence and goes into the merits of the case,
and cannot be invoked where the question at issue deals solely with the
legal sufficiency of the complaint, not with the question of weight or
admissibility of oral proof.
DECISION
REYES, J.B.L., J p:

Appeal from an order sustaining a motion to dismiss the complaint in

Civil Case No. Q-5482 of the Court of First Instance of Rizal, Quezon City
Branch.
The defendants contracted to sell to each of the several plaintiffs
certain subdivision lots embraced in the Congressional Avenue
Subdivision and covered by Transfer Certificates of Title Nos. 35882,
27016, and 34844 of the Register of Deeds of Quezon City. Except as to
the lots, the amounts for the consideration of the contracts, the parties
and corresponding particulars involved for each plaintiff, the contracts
were identical and were executed within the months of February to
April, 1960. The contracts, among other stipulations, provided for
payment in installments, the same to be deemed as liquidated
damages and rentals in case of failure to pay any installment, but to be
considered as the purchase price as for an absolute sale upon full
payment. These identical contracts made no reference to Ordinance No.
2969 of Quezon City and the rules and regulations of the National
Planning Commission, but provided that
"representatives of the Vendors shall have the
right to enter the property at any time for the
purposes of inspection, measurement or the
laying of necessary lines of water, gas, light,
telephone, etc."
The complaint alleges that while the plaintiffs-vendees have complied
with their obligations and have begun or contracted for the construction
of their houses, the defendants have failed, notwithstanding the
plaintiffs' demands, to construct the necessary roads that would serve
as outlets in accordance with the requirements and specifications of
existing laws and regulations; that defendant de los Santos "made
plaintiffs understand that she binds herself to, among others, construct
roads, particularly outlets for entrance and egress to and from the lots";
that "defendant represented to plaintiffs that she would have
constructed adequate outlets to and from the lots purchased"; that
without these roads, the lots in question would be uninhabitable,
impassable and valueless pieces of real estate which plaintiff would not
even venture to consider purchasing; wherefore, the plaintiffs pray for
judgment ordering the defendants to construct these roads and pay
actual and moral damages and attorney's fees.

The defendants interposed a motion to dismiss on the ground that the

complaint states no cause of action, and that the plaintiffs have no legal
capacity to sue. The trial court sustained the motion to dismiss. Not
satisfied, the plaintiffs filed a motion for reconsideration, insisting that
they have alleged in their complaint that the defendants promised to
construct roads. Acting upon this motion for reconsideration, the court,
over plaintiffs' objection and protest that by the motion to dismiss
defendant admitted the allegations of the complaint, held a hearing,
which was limited to the reception of evidence on the aforesaid
allegation. Finding from the testimonies that the alleged promise was
verbal, that it was not included in the written agreements, and that the
defendants denied having made such a promise, the said court denied
the motion for reconsideration.
Thereafter, the case was regularly appealed to this Court by the
plaintiffs.
The issues raised by the motion to dismiss are two:
(1)Did the complaint state a cause of action to compel defendant to
construct roads to serve as outlets for the lots in question?
(2)Do the plaintiffs have the capacity to bring an action to enforce
Quezon City Ordinance No. 2969?
On the first point, we are of the opinion that the complaint did state a
cause of action. The lower court, in dismissing the complaint because
the appended written contract mentioned no obligation to construct
roads, has erroneously assumed that plaintiffs predicate their action
exclusively on the written agreements, and has ignored the specific
allegations of fact in paragraph VI of the complaint
"That prior to and simultaneously with the
execution of the aforesaid contracts to sell, and
continuously thereafter, defendant represented to
plaintiffs that in accordance with her legal and
contractual
obligations,
she
would
have
constructed adequate outlets to and from the lots
purchased by plaintiffs towards a public or
national highway, aside from other facilities and
improvements, on or before the expected
termination of the construction of the residence of
plaintiffs Roseller T. Lim and Amy S. Lim, which

was to be on or about July, 1960, and on the

strength of such representation, the aforesaid
plaintiffs not only religiously paid all installments
begun the construction of their residential house
but also paid in full the purchase price of two
lots:" (Italics supplied.)
It is elementary that the motion to dismiss based on failure to state a
cause of action should be deemed to have admitted the truth of the
facts averred in the paragraph quoted (Ruperto vs. Fernando, 83 Phil.
343); and if they are true, then, necessarily, defendant should be
required to comply with her representations to construct the roads and
other facilities, because the plaintiffs have made disbursements in
reliance thereon that altered their position to their detriment,
particularly in the construction of their residence on the lots sold them
by the defendant-appellee.
The latter argues that there being a written contract and it not being
alleged that the same does not express the true intent of the parties,
oral bargains can not be admitted to extend, or vary, the written terms.
But the rule thus invoked is one of evidence (sec. 22, Rule 123), and
goes into the merits of the case, while we are here concerned solely
with the legal sufficiency of the complaint, not with the question of
weight or admissibility of oral proof.
The allegations in the complaint that defendant-vendor made
representations that "she would have constructed (i.e., would cause to
be built) adequate outlets" for the lots sold do not strike us to be so
improbable as to justify their being disbelieved de plano. After all, a
seller's duty is to deliver the thing sold in a condition suitable for its
enjoyment by the buyer for the purposes contemplated (Sent, Trib.
Supremo of Spain, 17 Nov. 1930), and proper access to a residence is
essential to its enjoyment. Additionally, at the time the contracts in
question were made (1960), the Subdivision Regulations of the National
Urban Planning Commission (45 Off. Gaz., No. 6, p. 2422) required
paved roadways to be constructed by the subdivision owner (sec. 17(b)
as they expressly specified that:
"SEC. 19.Approval.
e.Conditional approval.Until December 31,
1949, subdivisions may be approved and offered
for sale prior to full completion of the

improvements required by these regulations, upon

the filing of an undertaking by the subdivider that
such improvements shall be completed at the
subdivider's expense within a stated period of
time."
These words plainly imply that after December 31, 1949 subdivisions
may not be offered for sale until completion of improvements required
by the regulations. While the regulations could be modified by the City
or Municipal Board concerned, such modification, if made, would have
to be pleaded by way of defense in the answer, and not assumed when
a motion to dismiss is filed.
The taking of evidence upon the motion for reconsideration of the order
of dismissal was, in itself, an irregular procedure not authorized by the
rules, since it is precisely in the case of a motion to dismiss for failure to
state a cause of action where no evidence may be alleged or
considered to test the sufficiency of the complaint except the very facts
pleaded therein (Versoza vs. Rigonan, G.R. No. L-6459, 23 April 1954;
Dimayuga vs. Dimayuga, G.R. No. L-6740, 29 April 1955), and in the
event, the judge may not inquire into the truth of the allegations, and
find them to be false, before a hearing is had on the merits of the case
(Palma vs. Graciano, L-7240, 16 May 1956; Carreon vs. Prov. Bd. of
Pampanga, 52 O.G. 6558).
As a second ground for holding that the complaint failed to state a
cause of action, the court below declared that plaintiffs-appellants had
no personality to sue to compel defendant to comply with Urban
Planning Regulations and Quezon City Ordinance No. 2969, invoked by
them in paragraph V of the complaint. The court based its ruling on our
decision in Subido vs. City of Manila, L-14800, 30 May 1960. That
doctrine, however, is inapplicable to the case before us, because it
ruled that a private citizen may not contest the validity of an ordinance

in the absence of proof of special injury; while here appellants seek to

compel another private party (appellee) to comply with the Regulations
and Ordinances requiring a subdivision owner to construct roads and
facilities in the subdivision that afford access to plaintiffs' own lots. The
absence of such roads clearly causes plaintiffs-appellants a special
injury as lot purchasers, distinct and apart from the damage caused to
the community at large by the absence of such roads.

In any event, since paragraph VI of the complaint avers a

representation by defendant herself that she would construct the roads,
her failure to do so constitutes by itself a distinct and sufficient cause of
action irrespective of the Regulations and Ordinance that plaintiffs
invoke in paragraph V of their complaint. Whether such promise was
really made or not is a matter to be threshed out at the trial on the
merits, and not by a motion to dismiss for failure to state a cause of
action.
WHEREFORE, the order of dismissal appealed from is hereby set aside,
and the records ordered remanded for further proceedings conformable
to law.
Bautista, Angelo, J., took no part.
Paredes, Dizon, Regala and Makalintal, JJ., concur.
Bautista Angelo, J., took no part.