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SECOND DIVISION

[G.R. No. 120706. January 31, 2000]


RODRIGO CONCEPCION, petitioner, vs. COURT OF APPEALS and SPS. NESTOR NICOLAS and ALLEM
NICOLAS, respondents.
DECISION
BELLOSILLO, J.:
Petitioner Rodrigo Concepcion assails in this petition for review on certiorari the Decision of the Court
of Appeals dated 12 December 1994 which affirmed the decision of the Regional Trial Court of Pasig
City ordering him to pay respondent spouses Nestor Nicolas and Allem Nicolas the sums
of P50,000.00 for moral damages, P25,000.00 for exemplary damages and P10,000.00 for attorneys
fees, plus the costs of suit.* Petitioner claims absence of factual and legal basis for the award of
damages.
The courts a quo found that sometime in 1985 the spouses Nestor Nicolas and Allem Nicolas resided
at No. 51 M. Concepcion St., San Joaquin, Pasig City, in an apartment leased to them by the owner
thereof, Florence "Bing" Concepcion, who also resided in the same compound where the apartment
was located. Nestor Nicolas was then engaged in the business of supplying government agencies and
private entities with office equipment, appliances and other fixtures on a cash purchase or credit
basis. Florence Concepcion joined this venture by contributing capital on condition that after her
capital investment was returned to her, any profit earned would be divided equally between her and
Nestor. Jksm
Sometime in the second week of July 1985 Rodrigo Concepcion, brother of the deceased husband of
Florence, angrily accosted Nestor at the latters apartment and accused him of conducting an
adulterous relationship with Florence. He shouted,"Hoy Nestor, kabit ka ni Bing! x x x Binigyan ka pa
pala ni Bing Concepcion ng P100,000.00 para umakyat ng Baguio. Pagkaakyat mo at ng asawa mo
doon ay bababa ka uli para magkasarilinan kayo ni Bing."[1]
To clarify matters, Nestor went with Rodrigo, upon the latters dare, to see some relatives of the
Concepcion family who allegedly knew about the relationship. However, those whom they were able
to see denied knowledge of the alleged affair. The same accusation was hurled by Rodrigo against
Nestor when the two (2) confronted Florence at the terrace of her residence. Florence denied the
imputations and Rodrigo backtracked saying that he just heard the rumor from a relative. Thereafter,
however, Rodrigo called Florence over the telephone reiterating his accusation and threatening her
that should something happen to his sick mother, in case the latter learned about the affair, he would
kill Florence. Chief
As a result of this incident, Nestor Nicolas felt extreme embarrassment and shame to the extent that
he could no longer face his neighbors. Florence Concepcion also ceased to do business with him by
not contributing capital anymore so much so that the business venture of the Nicolas spouses
declined as they could no longer cope with their commitments to their clients and customers. To
make matters worse, Allem Nicolas started to doubt Nestors fidelity resulting in frequent bickerings
and quarrels during which Allem even expressed her desire to leave her husband. Consequently,
Nestor was forced to write Rodrigo demanding public apology and payment of damages. Rodrigo
pointedly ignored the demand, for which reason the Nicolas spouses filed a civil suit against him for
damages.
In his defense, Rodrigo denied that he maligned Nestor by accusing him publicly of being Florence's
lover. He reasoned out that he only desired to protect the name and reputation of the Concepcion
family which was why he sought an appointment with Nestor through Florence's son Roncali to
ventilate his feelings about the matter. Initially, he discussed with Nestor certain aspects of the joint
venture in a friendly and amiable manner, and then only casually asked the latter about his rumored
affair with his sister-in-law.

In contesting the decision of the appellate court, petitioner Rodrigo Concepcion raises the following
issues: (a) whether there is basis in law for the award of damages to private respondents, the Nicolas
spouses; and, (b) whether there is basis to review the facts which are of weight and influence but
which were overlooked and misapplied by the respondent appellate court. Esm
Petitioner argues that in awarding damages to private respondents, the Court of Appeals was without
legal basis to justify its verdict. The alleged act imputed to him by respondent spouses does not fall
under Arts. 26[2] and 2219[3] of the Civil Code since it does not constitute libel, slander, or any other
form of defamation. Neither does it involve prying into the privacy of anothers residence or meddling
with or disturbing the private life or family relation of another. Petitioner also insists that certain facts
and circumstances of the case were manifestly overlooked, misunderstood or glossed over by
respondent court which, if considered, would change the verdict. Impugning the credibility of the
witnesses for private respondents and the manner by which the testimonial evidence was analyzed
and evaluated by the trial court, petitioner criticized the appellate court for not taking into account
the fact that the trial judge who penned the decision was in no position to observe first-hand the
demeanor of the witnesses of respondent spouses as he was not the original judge who heard the
case. Thus, his decision rendered was flawed. Esmsc
The Court has ruled often enough that its jurisdiction in a petition for review on certiorari under Rule
45 of the Revised Rules of Court is limited to reviewing only errors of law, not of fact, unless the
factual findings complained of are devoid of support by the evidence on record or the assailed
judgment is based on misapprehension of facts.[4] The reason behind this is that the Supreme Court
respects the findings of the trial court on the issue of credibility of witnesses, considering that it is in
a better position to decide the question, having heard the witnesses themselves and observed their
deportment and manner of testifying during the trial.[5] Thus it accords the highest respect, even
finality, to the evaluation made by the lower court of the testimonies of the witnesses presented
before it. Esmmis
The Court is also aware of the long settled rule that when the issue is on the credibility of witnesses,
appellate courts will not generally disturb the findings of the trial court; however, its factual findings
may nonetheless be reversed if by the evidence on record or lack of it, it appears that the trial court
erred.[6] In this respect, the Court is not generally inclined to review the findings of fact of the Court
of Appeals unless its findings are erroneous, absurd, speculative, conjectural, conflicting, tainted with
grave abuse of discretion, or contrary to the findings culled by the trial court of origin.[7] This rule of
course cannot be unqualifiedly applied to a case where the judge who penned the decision was not
the one who heard the case, because not having heard the testimonies himself, the judge would not
be in a better position than the appellate courts to make such determination.[8]
However, it is also axiomatic that the fact alone that the judge who heard the evidence was not the
one who rendered the judgment but merely relied on the record of the case does not render his
judgment erroneous or irregular. This is so even if the judge did not have the fullest opportunity to
weigh the testimonies not having heard all the witnesses speak nor observed their deportment and
manner of testifying. Thus the Court generally will not find any misapprehension of facts as it can be
fairly assumed under the principle of regularity of performance of duties of public officers that the
transcripts of stenographic notes were thoroughly scrutinized and evaluated by the judge himself.
Has sufficient reason then been laid before us by petitioner to engender doubt as to the factual
findings of the court a quo? We find none. A painstaking review of the evidence on record convinces
us not to disturb the judgment appealed from. The fact that the case was handled by different judges
brooks no consideration at all, for preponderant evidence consistent with their claim for damages has
been adduced by private respondents as to foreclose a reversal. Otherwise, everytime a Judge who
heard a case, wholly or partially, dies or lives the service, the case cannot be decided and a new trial
will have to be conducted. That would be absurb; inconceivable. Esmso
According to petitioner, private respondents evidence is inconsistent as to time, place and persons
who heard the alleged defamatory statement. We find this to be a gratuitous observation, for the
testimonies of all the witnesses for the respondents are unanimous that the defamatory incident
happened in the afternoon at the front door of the apartment of the Nicolas spouses in the presence
of some friends and neighbors, and later on, with the accusation being repeated in the presence of

Florence, at the terrace of her house. That this finding appears to be in conflict with the allegation in
the complaint as to the time of the incident bears no momentous significance since an allegation in a
pleading is not evidence; it is a declaration that has to be proved by evidence. If evidence contrary to
the allegation is presented, such evidence controls, not the allegation in the pleading itself, although
admittedly it may dent the credibility of the witnesses. But not in the instant case. Msesm
It is also argued by petitioner that private respondents failed to present as witnesses the persons
they named as eyewitnesses to the incident and that they presented instead one Romeo Villaruel who
was not named as a possible witness during the pre-trial proceedings. Charging that Villaruels
testimony is not credible and should never have been accorded any weight at all, petitioner
capitalizes on the fact that a great distance separates Villaruels residence and that of private
respondents as reflected in their house numbers, the formers number being No. 223 M. Concepcion
St., while that of the Nicolas spouses, No. 51 along the same street. This being so, petitioner
concludes, Villaruel could not have witnessed the ugly confrontation between Rodrigo and Nestor. It
appears however from Villaruels testimony that at the time of the incident complained of, he was
staying in an apartment inside the compound adjacent to that of the Nicolas spouses. Whether his
apartment was then numbered 223 is not stated. What is definite and clear is his statement that he
and Nestor Nicolas were neighbors on 14 July 1985.
There are other inconsistencies pointed out by petitioner in the testimonial evidence of private
respondents but these are not of such significance as to alter the finding of facts of the lower court.
Minor inconsistencies even guarantee truthfulness and candor, for they erase any suspicion of a
rehearsed testimony.[9] Inconsistencies in the testimonies of witnesses with on minor details and
collateral matters do not affect the substance of their testimonies.[10]
All told, these factual findings provide enough basis in law for the award of damages by the Court of
Appeals in favor of respondents. We reject petitioners posture that no legal provision supports such
award, the incident complained of neither falling under Art. 2219 nor Art. 26 of the Civil Code. It does
not need further elucidation that the incident charged of petitioner was no less than an invasion on
the right of respondent Nestor as a person. The philosophy behind Art. 26 underscores the necessity
for its inclusion in our civil law. The Code Commission stressed in no uncertain terms that the human
personality must be exalted. The sacredness of human personality is a concomitant consideration of
every plan for human amelioration. The touchstone of every system of law, of the culture and
civilization of every country, is how far it dignifies man. If the statutes insufficiently protect a person
from being unjustly humiliated, in short, if human personality is not exalted - then the laws are indeed
defective.[11] Thus, under this article, the rights of persons are amply protected, and damages are
provided for violations of a persons dignity, personality, privacy and peace of mind. Exsm
It is petitioners position that the act imputed to him does not constitute any of those enumerated in
Arts 26 and 2219. In this respect, the law is clear. The violations mentioned in the codal provisions are
not exclusive but are merely examples and do not preclude other similar or analogous acts. Damages
therefore are allowable for actions against a persons dignity, such as profane, insulting, humiliating,
scandalous or abusive language.[12] Under Art. 2217 of the Civil Code, moral damages which include
physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar injury, although incapable of pecuniary computation, may
be recovered if they are the proximate result of the defendants wrongful act or omission.
There is no question that private respondent Nestor Nicolas suffered mental anguish, besmirched
reputation, wounded feelings and social humiliation as a proximate result of petitioners abusive,
scandalous and insulting language. Petitioner attempted to exculpate himself by claiming that he
made an appointment to see Nestor through a nephew, Roncali, the son of Florence, so he could talk
with Nestor to find out the truth about his rumored illicit relationship with Florence. He said that he
wanted to protect his nephews and nieces and the name of his late brother (Florences husband).
[13] How he could be convinced by some way other than a denial by Nestor, and how he would
protect his nephews and nieces and his familys name if the rumor were true, he did not say. Petitioner
admitted that he had already talked with Florence herself over the telephone about the issue, with
the latter vehemently denying the alleged immoral relationship. Yet, he could not let the matter rest
on the strength of the denial of his sister-in-law. He had to go and confront Nestor, even in public, to
the latter's humiliation. Kyle

Testifying that until that very afternoon of his meeting with Nestor he never knew respondent, had
never seen him before, and was unaware of his business partnership with Florence, his subsequent
declarations on the witness stand however belie this lack of knowledge about the business venture
for in that alleged encounter he asked Nestor how the business was going, what were the collection
problems, and how was the money being spent. He even knew that the name of the business, Floral
Enterprises, was coined by combining the first syllables of the name Florence and Allem, the name of
Nestors wife. He said that he casually asked Nestor about the rumor between him and Florence which
Nestor denied. Not content with such denial, he dared Nestor to go with him to speak to his relatives
who were the source of his information. Nestor went with him and those they were able to talk to
denied the rumor. Kycalr
We cannot help noting this inordinate interest of petitioner to know the truth about the rumor and
why he was not satisfied with the separate denials made by Florence and Nestor. He had to confront
Nestor face to face, invade the latters privacy and hurl defamatory words at him in the presence of
his wife and children, neighbors and friends, accusing him - a married man - of having an adulterous
relationship with Florence. This definitely caused private respondent much shame and
embarrassment that he could no longer show himself in his neighborhood without feeling distraught
and debased. This brought dissension and distrust in his family where before there was none. This is
why a few days after the incident, he communicated with petitioner demanding public apology and
payment of damages, which petitioner ignored. Calrky
If indeed the confrontation as described by private respondents did not actually happen, then there
would have been no cause or motive at all for them to consult with their lawyer, immediately demand
an apology, and not obtaining a response from petitioner, file an action for damages against the
latter. That they decided to go to court to seek redress bespeaks of the validity of their claim. On the
other hand, it is interesting to note that while explaining at great length why Florence Concepcion
testified against him, petitioner never advanced any reason why the Nicolas spouses, persons he
never knew and with whom he had no dealings in the past, would sue him for damages. It also has
not escaped our attention that, faced with a lawsuit by private respondents, petitioner sent his
lawyer, a certain Atty. Causapin, to talk not to the Nicolas spouses but to Florence, asking her not to
be involved in the case, otherwise her name would be messily dragged into it. Quite succinctly,
Florence told the lawyer that it was not for her to decide and that she could not do anything about it
as she was not a party to the court case.
WHEREFORE, in light of the foregoing premises, the assailed Decision of the Court of Appeals
affirming the judgment of the Regional Trial Court of Pasig City, Br. 167, holding Rodrigo Concepcion
liable to the spouses Nestor Nicolas and Allem Nicolas for P50,000.00 as moral damages, P25,000.00
for exemplary damages, P10,000.00 for attorney's fees, plus costs of suit, is AFFIRMED. Mesm
SO ORDERED.
Mendoza, Quisumbing, Buena, and De Leon, Jr., JJ., concur.

THIRD DIVISION
G.R. No. 202666, September 29, 2014
RHONDA AVE S. VIVARES AND SPS. MARGARITA AND DAVID SUZARA, Petitioners, v. ST. THERESAS
COLLEGE, MYLENE RHEZA T. ESCUDERO, AND JOHN DOES, Respondents.
DECISION
VELASCO JR., J.:

The individuals desire for privacy is never absolute, since participation in society is an equally
powerful desire. Thus each individual is continually engaged in a personal adjustment process in
which he balances the desire for privacy with the desire for disclosure and communication of himself
to others, in light of the environmental conditions and social norms set by the society in which he
lives.
~ Alan Westin, Privacy and Freedom (1967)

The Case
Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, in relation to
Section 19 of A.M. No. 08-1-16-SC,1 otherwise known as the Rule on the Writ of Habeas Data.
Petitioners herein assail the July 27, 2012 Decision2 of the Regional Trial Court, Branch 14 in Cebu
City (RTC) in SP. Proc. No. 19251-CEB, which dismissed their habeas data petition.
The Facts
Nenita Julia V. Daluz (Julia) and Julienne Vida Suzara (Julienne), both minors, were, during the period
material, graduating high school students at St. Theresas College (STC), Cebu City. Sometime in
January 2012, while changing into their swimsuits for a beach party they were about to attend, Julia
and Julienne, along with several others, took digital pictures of themselves clad only in their
undergarments. These pictures were then uploaded by Angela Lindsay Tan (Angela) on her
Facebook3 profile.
Back at the school, Mylene Rheza T. Escudero (Escudero), a computer teacher at STCs high school
department, learned from her students that some seniors at STC posted pictures online, depicting
themselves from the waist up, dressed only in brassieres. Escudero then asked her students if they
knew who the girls in the photos are. In turn, they readily identified Julia, Julienne, and Chloe Lourdes
Taboada (Chloe), among others.
Using STCs computers, Escuderos students logged in to their respective personal Facebook accounts
and showed her photos of the identified students, which include: (a) Julia and Julienne drinking hard
liquor and smoking cigarettes inside a bar; and (b) Julia and Julienne along the streets of Cebu
wearing articles of clothing that show virtually the entirety of their black brassieres. What is more,
Escuderos students claimed that there were times when access to or the availability of the identified
students photos was not confined to the girls Facebook friends,4 but were, in fact, viewable by any
Facebook user.5cralawlawlibrary
Upon discovery, Escudero reported the matter and, through one of her students Facebook page,
showed the photos to Kristine Rose Tigol (Tigol), STCs Discipline-in-Charge, for appropriate action.
Thereafter, following an investigation, STC found the identified students to have deported themselves
in a manner proscribed by the schools Student Handbook, to wit:chanRoblesvirtualLawlibrary
Possession of alcoholic drinks outside the school campus;
Engaging in immoral, indecent, obscene or lewd acts;
Smoking and drinking alcoholic beverages in public places;
Apparel that exposes the underwear;
Clothing that advocates unhealthy behaviour; depicts obscenity; contains sexually suggestive
messages, language or symbols; and
Posing and uploading pictures on the Internet that entail ample body exposure.

On March 1, 2012, Julia, Julienne, Angela, and the other students in the pictures in question, reported,
as required, to the office of Sr. Celeste Ma. Purisima Pe (Sr. Purisima), STCs high school principal and
ICM6 Directress. They claimed that during the meeting, they were castigated and verbally abused by
the STC officials present in the conference, including Assistant Principal Mussolini S. Yap (Yap),
Roswinda Jumiller, and Tigol. What is more, Sr. Purisima informed their parents the following day that,
as part of their penalty, they are barred from joining the commencement exercises scheduled on
March 30, 2012.
A week before graduation, or on March 23, 2012, Angelas mother, Dr. Armenia M. Tan (Tan), filed a
Petition for Injunction and Damages before the RTC of Cebu City against STC, et al., docketed as Civil
Case No. CEB-38594.7 In it, Tan prayed that defendants therein be enjoined from implementing the
sanction that precluded Angela from joining the commencement exercises. On March 25, 2012,
petitioner Rhonda Ave Vivares (Vivares), the mother of Julia, joined the fray as an intervenor.
On March 28, 2012, defendants in Civil Case No. CEB-38594 filed their memorandum, containing
printed copies of the photographs in issue as annexes. That same day, the RTC issued a temporary
restraining order (TRO) allowing the students to attend the graduation ceremony, to which STC filed a
motion for reconsideration.
Despite the issuance of the TRO, STC, nevertheless, barred the sanctioned students from participating
in the graduation rites, arguing that, on the date of the commencement exercises, its adverted
motion for reconsideration on the issuance of the TRO remained unresolved.
Thereafter, petitioners filed before the RTC a Petition for the Issuance of a Writ of Habeas Data,
docketed as SP. Proc. No. 19251-CEB8 on the basis of the following
considerations:chanRoblesvirtualLawlibrary
The photos of their children in their undergarments (e.g., bra) were taken for posterity before they
changed into their swimsuits on the occasion of a birthday beach party;
The privacy setting of their childrens Facebook accounts was set at Friends Only. They, thus, have a
reasonable expectation of privacy which must be respected.
Respondents, being involved in the field of education, knew or ought to have known of laws that
safeguard the right to privacy. Corollarily, respondents knew or ought to have known that the girls,
whose privacy has been invaded, are the victims in this case, and not the offenders. Worse, after
viewing the photos, the minors were called immoral and were punished outright;
The photos accessed belong to the girls and, thus, cannot be used and reproduced without their
consent. Escudero, however, violated their rights by saving digital copies of the photos and by
subsequently showing them to STCs officials. Thus, the Facebook accounts of petitioners children
were intruded upon;
The intrusion into the Facebook accounts, as well as the copying of information, data, and digital
images happened at STCs Computer Laboratory; and
All the data and digital images that were extracted were boldly broadcasted by respondents through
their memorandum submitted to the RTC in connection with Civil Case No. CEB-38594.
To petitioners, the interplay of the foregoing constitutes an invasion of their childrens privacy and,
thus, prayed that: (a) a writ of habeas data be issued; (b) respondents be ordered to surrender and
deposit with the court all soft and printed copies of the subject data before or at the preliminary
hearing; and (c) after trial, judgment be rendered declaring all information, data, and digital images
accessed, saved or stored, reproduced, spread and used, to have been illegally obtained in violation
of the childrens right to privacy.
Finding the petition sufficient in form and substance, the RTC, through an Order dated July 5, 2012,
issued the writ of habeas data. Through the same Order, herein respondents were directed to file

their verified written return, together with the supporting affidavits, within five (5) working days from
service of the writ.
In time, respondents complied with the RTCs directive and filed their verified written return, laying
down the following grounds for the denial of the petition, viz: (a) petitioners are not the proper parties
to file the petition; (b) petitioners are engaging in forum shopping; (c) the instant case is not one
where a writ of habeas data may issue; and (d) there can be no violation of their right to privacy as
there is no reasonable expectation of privacy on Facebook.
Ruling of the Regional Trial Court
On July 27, 2012, the RTC rendered a Decision dismissing the petition for habeas data. The dispositive
portion of the Decision pertinently states:chanRoblesvirtualLawlibrary
WHEREFORE, in view of the foregoing premises, the Petition is hereby DISMISSED.
The parties and media must observe the aforestated confidentiality.
xxxx
SO ORDERED.9
To the trial court, petitioners failed to prove the existence of an actual or threatened violation of the
minors right to privacy, one of the preconditions for the issuance of the writ of habeas data.
Moreover, the court a quo held that the photos, having been uploaded on Facebook without
restrictions as to who may view them, lost their privacy in some way. Besides, the RTC noted, STC
gathered the photographs through legal means and for a legal purpose, that is, the implementation of
the schools policies and rules on discipline.
Not satisfied with the outcome, petitioners now come before this Court pursuant to Section 19 of the
Rule on Habeas Data.10cralawlawlibrary
The Issues
The main issue to be threshed out in this case is whether or not a writ of habeas data should be
issued given the factual milieu. Crucial in resolving the controversy, however, is the pivotal point of
whether or not there was indeed an actual or threatened violation of the right to privacy in the life,
liberty, or security of the minors involved in this case.
Our Ruling
We find no merit in the petition.
Procedural issues concerning the
availability of the Writ of Habeas Data
The writ of habeas data is a remedy available to any person whose right to privacy in life, liberty or
security is violated or threatened by an unlawful act or omission of a public official or employee, or of
a private individual or entity engaged in the gathering, collecting or storing of data or information
regarding the person, family, home and correspondence of the aggrieved party.11 It is an
independent and summary remedy designed to protect the image, privacy, honor, information, and
freedom of information of an individual, and to provide a forum to enforce ones right to the truth and
to informational privacy. It seeks to protect a persons right to control information regarding oneself,
particularly in instances in which such information is being collected through unlawful means in order
to achieve unlawful ends.12cralawlawlibrary

In developing the writ of habeas data, the Court aimed to protect an individuals right to informational
privacy, among others. A comparative law scholar has, in fact, defined habeas data as a procedure
designed to safeguard individual freedom from abuse in the information age.13 The writ, however,
will not issue on the basis merely of an alleged unauthorized access to information about a person.
Availment of the writ requires the existence of a nexus between the right to privacy on the one hand,
and the right to life, liberty or security on the other.14 Thus, the existence of a persons right to
informational privacy and a showing, at least by substantial evidence, of an actual or threatened
violation of the right to privacy in life, liberty or security of the victim are indispensable before the
privilege of the writ may be extended.15cralawlawlibrary
Without an actionable entitlement in the first place to the right to informational privacy, a habeas
datapetition will not prosper. Viewed from the perspective of the case at bar, this requisite begs this
question: given the nature of an online social network (OSN)(1) that it facilitates and promotes realtime interaction among millions, if not billions, of users, sans the spatial barriers,16 bridging the gap
created by physical space; and (2) that any information uploaded in OSNs leaves an indelible trace in
the providers databases, which are outside the control of the end-usersis there a right to
informational privacy in OSN activities of its users? Before addressing this point, We must first resolve
the procedural issues in this case.
The writ of habeas data is not only confined to
cases of extralegal killings and enforced disappearancesContrary to respondents submission, the
Writ of Habeas Data was not enacted solely for the purpose of complementing the Writ ofAmparo in
cases of extralegal killings and enforced disappearances.
Section 2 of the Rule on the Writ of Habeas Data provides:chanRoblesvirtualLawlibrary
Sec. 2. Who May File. Any aggrieved party may file a petition for the writ of habeas
data. However, in cases of extralegal killings and enforced disappearances, the petition may be filed
by:chanRoblesvirtualLawlibrary
(a)

Any member of the immediate family of the aggrieved party, namely: the spouse, children
and parents; or

(b)

Any ascendant, descendant or collateral relative of the aggrieved party within the fourth
civil degree of consanguinity or affinity, in default of those mentioned in the preceding
paragraph. (emphasis supplied)

Had the framers of the Rule intended to narrow the operation of the writ only to cases of extralegal
killings or enforced disappearances, the above underscored portion of Section 2, reflecting a variance
of habeas data situations, would not have been made.
Habeas data, to stress, was designed to safeguard individual freedom from abuse in the information
age.17 As such, it is erroneous to limit its applicability to extralegal killings and enforced
disappearances only. In fact, the annotations to the Rule prepared by the Committee on the Revision
of the Rules of Court, after explaining that the Writ of Habeas Data complements the Writ of Amparo,
pointed out that:chanRoblesvirtualLawlibrary
The writ of habeas data, however, can be availed of as an independent remedy to enforce ones right
to privacy, more specifically the right to informational privacy. The remedies against the violation of
such right can include the updating, rectification, suppression or destruction of the database or
information or files in possession or in control of respondents.18 (emphasis Ours)
Clearly then, the privilege of the Writ of Habeas Data may also be availed of in cases outside of
extralegal killings and enforced disappearances.
Meaning of engaged in the gathering,
collecting or storing of data or informationRespondents contention that the habeas data writ may not

issue against STC, it not being an entity engaged in the gathering, collecting or storing of data or
information regarding the person, family, home and correspondence of the aggrieved party, while
valid to a point, is, nonetheless, erroneous.
To be sure, nothing in the Rule would suggest that the habeas data protection shall be available only
against abuses of a person or entity engaged in the business of gathering, storing, and collecting of
data. As provided under Section 1 of the Rule:chanRoblesvirtualLawlibrary
Section 1. Habeas Data. The writ of habeas data is a remedy available to any person whose right to
privacy in life, liberty or security is violated or threatened by an unlawful act or omission of a public
official or employee, or of a private individual or entity engaged in the gathering, collecting or storing
of data or information regarding the person, family, home and correspondence of the aggrieved
party. (emphasis Ours)
The provision, when taken in its proper context, as a whole, irresistibly conveys the idea that habeas
data is a protection against unlawful acts or omissions of public officials and of private individuals or
entities engaged in gathering, collecting, or storing data about the aggrieved party and his or her
correspondences, or about his or her family. Such individual or entity need not be in the business of
collecting or storing data.
To engage in something is different from undertaking a business endeavour. To engage means to
do or take part in something.19 It does not necessarily mean that the activity must be done in
pursuit of a business. What matters is that the person or entity must be gathering, collecting or
storing said data or information about the aggrieved party or his or her family. Whether such
undertaking carries the element of regularity, as when one pursues a business, and is in the nature of
a personal endeavour, for any other reason or even for no reason at all, is immaterial and such will
not prevent the writ from getting to said person or entity.
To agree with respondents above argument, would mean unduly limiting the reach of the writ to a
very small group, i.e., private persons and entities whose business is data gathering and storage, and
in the process decreasing the effectiveness of the writ as an instrument designed to protect a right
which is easily violated in view of rapid advancements in the information and communications
technologya right which a great majority of the users of technology themselves are not capable of
protecting.
Having resolved the procedural aspect of the case, We now proceed to the core of the controversy.
The right to informational privacy on Facebook
The Right to Informational Privacy
The concept of privacy has, through time, greatly evolved, with technological advancements having
an influential part therein. This evolution was briefly recounted in former Chief Justice Reynato S.
Punos speech, The Common Right to Privacy,20 where he explained the three strands of the right to
privacy, viz: (1) locational or situational privacy;21 (2) informational privacy; and (3) decisional
privacy.22 Of the three, what is relevant to the case at bar is the right to informational privacy
usually defined as the right of individuals to control information about themselves.23cralawlawlibrary
With the availability of numerous avenues for information gathering and data sharing nowadays, not
to mention each systems inherent vulnerability to attacks and intrusions, there is more reason that
every individuals right to control said flow of information should be protected and that each
individual should have at least a reasonable expectation of privacy in cyberspace. Several
commentators regarding privacy and social networking sites, however, all agree that given the
millions of OSN users, [i]n this [Social Networking] environment, privacy is no longer grounded in
reasonable expectations, but rather in some theoretical protocol better known as wishful
thinking.24cralawlawlibrary
It is due to this notion that the Court saw the pressing need to provide for judicial remedies that
would allow a summary hearing of the unlawful use of data or information and to remedy possible

violations of the right to privacy.25 In the same vein, the South African High Court, in its Decision in
the landmark case, H v. W,26 promulgated on January 30, 2013, recognized that [t]he law has to
take into account the changing realities not only technologically but also socially or else it will lose
credibility in the eyes of the people. x x x It is imperative that the courts respond appropriately to
changing times, acting cautiously and with wisdom. Consistent with this, the Court, by developing
what may be viewed as the Philippine model of the writ of habeas data, in effect, recognized that,
generally speaking, having an expectation of informational privacy is not necessarily incompatible
with engaging in cyberspace activities, including those that occur in OSNs.
The question now though is up to what extent is the right to privacy protected in OSNs? Bear in mind
that informational privacy involves personal information. At the same time, the very purpose of OSNs
is socializingsharing a myriad of information,27 some of which would have otherwise remained
personal.
Facebooks Privacy Tools: a response to
the clamor for privacy in OSN activities
Briefly, the purpose of an OSN is precisely to give users the ability to interact and to stay connected
to other members of the same or different social media platform through the sharing of statuses,
photos, videos, among others, depending on the services provided by the site. It is akin to having a
room filled with millions of personal bulletin boards or walls, the contents of which are under the
control of each and every user. In his or her bulletin board, a user/owner can post anythingfrom
text, to pictures, to music and videosaccess to which would depend on whether he or she allows
one, some or all of the other users to see his or her posts. Since gaining popularity, the OSN
phenomenon has paved the way to the creation of various social networking sites, including the one
involved in the case at bar, www.facebook.com (Facebook), which, according to its developers, people
use to stay connected with friends and family, to discover whats going on in the world, and to share
and express what matters to them.28cralawlawlibrary
Facebook connections are established through the process of friending another user. By sending a
friend request, the user invites another to connect their accounts so that they can view any and all
Public and Friends Only posts of the other. Once the request is accepted, the link is established
and both users are permitted to view the other users Public or Friends Only posts, among others.
Friending, therefore, allows the user to form or maintain one-to-one relationships with other users,
whereby the user gives his or her Facebook friend access to his or her profile and shares certain
information to the latter.29cralawlawlibrary
To address concerns about privacy,30 but without defeating its purpose, Facebook was armed with
different privacy tools designed to regulate the accessibility of a users profile31 as well as
information uploaded by the user. In H v. W,32 the South Gauteng High Court recognized this ability
of the users to customize their privacy settings, but did so with this caveat: Facebook states in its
policies that, although it makes every effort to protect a users information, these privacy settings are
not fool-proof.33cralawlawlibrary
For instance, a Facebook user can regulate the visibility and accessibility of digital images (photos),
posted on his or her personal bulletin or wall, except for the users profile picture and ID, by
selecting his or her desired privacy setting:chanRoblesvirtualLawlibrary
(a) Public - the default setting; every Facebook user can view the photo;
(b) Friends of Friends - only the users Facebook friends and their friends can view the photo;
(b) Friends - only the users Facebook friends can view the photo;
(c) Custom - the photo is made visible only to particular friends and/or networks of the Facebook user;
and
(d) Only Me - the digital image can be viewed only by the user.
The foregoing are privacy tools, available to Facebook users, designed to set up barriers to broaden or
limit the visibility of his or her specific profile content, statuses, and photos, among others, from
another users point of view. In other words, Facebook extends its users an avenue to make the
availability of their Facebook activities reflect their choice as to when and to what extent to disclose

facts about [themselves] and to put others in the position of receiving such confidences.34 Ideally,
the selected setting will be based on ones desire to interact with others, coupled with the opposing
need to withhold certain information as well as to regulate the spreading of his or her personal
information. Needless to say, as the privacy setting becomes more limiting, fewer Facebook users can
view that users particular post.
STC did not violate petitioners daughters right to privacy
Without these privacy settings, respondents contention that there is no reasonable expectation of
privacy in Facebook would, in context, be correct. However, such is not the case. It is through the
availability of said privacy tools that many OSN users are said to have a subjective expectation that
only those to whom they grant access to their profile will view the information they post or upload
thereto.35cralawlawlibrary
This, however, does not mean that any Facebook user automatically has a protected expectation of
privacy in all of his or her Facebook activities.
Before one can have an expectation of privacy in his or her OSN activity, it is first necessary that said
user, in this case the children of petitioners, manifest the intention to keep certain posts private,
through the employment of measures to prevent access thereto or to limit its visibility.36 And this
intention can materialize in cyberspace through the utilization of the OSNs privacy tools. In other
words, utilization of these privacy tools is the manifestation, in cyber world, of the users invocation of
his or her right to informational privacy.37cralawlawlibrary
Therefore, a Facebook user who opts to make use of a privacy tool to grant or deny access to his or
her post or profile detail should not be denied the informational privacy right which necessarily
accompanies said choice.38 Otherwise, using these privacy tools would be a feckless exercise, such
that if, for instance, a user uploads a photo or any personal information to his or her Facebook page
and sets its privacy level at Only Me or a custom list so that only the user or a chosen few can view
it, said photo would still be deemed public by the courts as if the user never chose to limit the photos
visibility and accessibility. Such position, if adopted, will not only strip these privacy tools of their
function but it would also disregard the very intention of the user to keep said photo or information
within the confines of his or her private space.
We must now determine the extent that the images in question were visible to other Facebook users
and whether the disclosure was confidential in nature. In other words, did the minors limit the
disclosure of the photos such that the images were kept within their zones of privacy? This
determination is necessary in resolving the issue of whether the minors carved out a zone of privacy
when the photos were uploaded to Facebook so that the images will be protected against
unauthorized access and disclosure.
Petitioners, in support of their thesis about their childrens privacy right being violated, insist that
Escudero intruded upon their childrens Facebook accounts, downloaded copies of the pictures and
showed said photos to Tigol. To them, this was a breach of the minors privacy since their Facebook
accounts, allegedly, were under very private or Only Friends setting safeguarded with a
password.39 Ultimately, they posit that their childrens disclosure was only limited since their profiles
were not open to public viewing. Therefore, according to them, people who are not their Facebook
friends, including respondents, are barred from accessing said post without their knowledge and
consent. As petitioners children testified, it was Angela who uploaded the subject photos which were
only viewable by the five of them,40 although who these five are do not appear on the records.
Escudero, on the other hand, stated in her affidavit41 that my students showed me some pictures of
girls clad in brassieres. This student [sic] of mine informed me that these are senior high school
[students] of STC, who are their friends in [F]acebook. x x x They then said [that] there are still many
other photos posted on the Facebook accounts of these girls. At the computer lab, these students
then logged into their Facebook account [sic], and accessed from there the various photographs x x x.
They even told me that there had been times when these photos were public i.e., not confined to
their friends in Facebook.

In this regard, We cannot give much weight to the minors testimonies for one key reason: failure to
question the students act of showing the photos to Tigol disproves their allegation that the photos
were viewable only by the five of them. Without any evidence to corroborate their statement that the
images were visible only to the five of them, and without their challenging Escuderos claim that the
other students were able to view the photos, their statements are, at best, self-serving, thus
deserving scant consideration.42cralawlawlibrary
It is well to note that not one of petitioners disputed Escuderos sworn account that her students, who
are the minors Facebook friends, showed her the photos using their own Facebook accounts. This
only goes to show that no special means to be able to view the allegedly private posts were ever
resorted to by Escuderos students,43 and that it is reasonable to assume, therefore, that the photos
were, in reality, viewable either by (1) their Facebook friends, or (2) by the public at large.
Considering that the default setting for Facebook posts is Public, it can be surmised that the
photographs in question were viewable to everyone on Facebook, absent any proof that petitioners
children positively limited the disclosure of the photograph. If such were the case, they cannot invoke
the protection attached to the right to informational privacy. The ensuing pronouncement in US v.
Gines-Perez44 is most instructive:chanRoblesvirtualLawlibrary
[A] person who places a photograph on the Internet precisely intends to forsake and renounce all
privacy rights to such imagery, particularly under circumstances such as here, where the Defendant
did not employ protective measures or devices that would have controlled access to the Web page or
the photograph itself.45chanrobleslaw
Also, United States v. Maxwell46 held that [t]he more open the method of transmission is, the less
privacy one can reasonably expect. Messages sent to the public at large in the chat room or e-mail
that is forwarded from correspondent to correspondent loses any semblance of privacy.
That the photos are viewable by friends only does not necessarily bolster the petitioners
contention. In this regard, the cyber community is agreed that the digital images under this setting
still remain to be outside the confines of the zones of privacy in view of the
following:chanRoblesvirtualLawlibrary
(1)

Facebook allows the world to be more open and connected by giving its users the tools to
interact and share in any conceivable way;47

(2)

A good number of Facebook users befriend other users who are total strangers;48

(3)

The sheer number of Friends one user has, usually by the hundreds; and

(4)

A users Facebook friend can share49 the formers post, or tag50 others who are not
Facebook friends with the former, despite its being visible only to his or her own Facebook
friends.

It is well to emphasize at this point that setting a posts or profile details privacy to Friends is no
assurance that it can no longer be viewed by another user who is not Facebook friends with the
source of the content. The users own Facebook friend can share said content or tag his or her own
Facebook friend thereto, regardless of whether the user tagged by the latter is Facebook friends or
not with the former. Also, when the post is shared or when a person is tagged, the respective
Facebook friends of the person who shared the post or who was tagged can view the post, the privacy
setting of which was set at Friends.
To illustrate, suppose A has 100 Facebook friends and B has 200. A and B are not Facebook friends. If
C, As Facebook friend, tags B in As post, which is set at Friends, the initial audience of 100 (As
own Facebook friends) is dramatically increased to 300 (As 100 friends plus Bs 200 friends or the
public, depending upon Bs privacy setting). As a result, the audience who can view the post is
effectively expandedand to a very large extent.

This, along with its other features and uses, is confirmation of Facebooks proclivity towards user
interaction and socialization rather than seclusion or privacy, as it encourages broadcasting of
individual user posts. In fact, it has been said that OSNs have facilitated their users self-tribute,
thereby resulting into the democratization of fame.51 Thus, it is suggested, that a profile, or even a
post, with visibility set at Friends Only cannot easily, more so automatically, be said to be very
private, contrary to petitioners argument.
As applied, even assuming that the photos in issue are visible only to the sanctioned students
Facebook friends, respondent STC can hardly be taken to task for the perceived privacy invasion since
it was the minors Facebook friends who showed the pictures to Tigol. Respondents were mere
recipients of what were posted. They did not resort to any unlawful means of gathering the
information as it was voluntarily given to them by persons who had legitimate access to the said
posts. Clearly, the fault, if any, lies with the friends of the minors. Curiously enough, however, neither
the minors nor their parents imputed any violation of privacy against the students who showed the
images to Escudero.
Furthermore, petitioners failed to prove their contention that respondents reproduced and
broadcasted the photographs. In fact, what petitioners attributed to respondents as an act of
offensive disclosure was no more than the actuality that respondents appended said photographs in
their memorandum submitted to the trial court in connection with Civil Case No. CEB-38594.52 These
are not tantamount to a violation of the minors informational privacy rights, contrary to petitioners
assertion.
In sum, there can be no quibbling that the images in question, or to be more precise, the photos of
minor students scantily clad, are personal in nature, likely to affect, if indiscriminately circulated, the
reputation of the minors enrolled in a conservative institution. However, the records are bereft of any
evidence, other than bare assertions that they utilized Facebooks privacy settings to make the
photos visible only to them or to a select few. Without proof that they placed the photographs subject
of this case within the ambit of their protected zone of privacy, they cannot now insist that they have
an expectation of privacy with respect to the photographs in question.
Had it been proved that the access to the pictures posted were limited to the original uploader,
through the Me Only privacy setting, or that the users contact list has been screened to limit
access to a select few, through the Custom setting, the result may have been different, for in such
instances, the intention to limit access to the particular post, instead of being broadcasted to the
public at large or all the users friends en masse, becomes more manifest and palpable.
On Cyber Responsibility
It has been said that the best filter is the one between your childrens ears.53 This means that selfregulation on the part of OSN users and internet consumers in general is the best means of avoiding
privacy rights violations.54 As a cyberspace community member, one has to be proactive in
protecting his or her own privacy.55 It is in this regard that many OSN users, especially minors, fail.
Responsible social networking or observance of the netiquettes56 on the part of teenagers has
been the concern of many due to the widespread notion that teenagers can sometimes go too far
since they generally lack the people skills or general wisdom to conduct themselves sensibly in a
public forum.57cralawlawlibrary
Respondent STC is clearly aware of this and incorporating lessons on good cyber citizenship in its
curriculum to educate its students on proper online conduct may be most timely. Too, it is not only
STC but a number of schools and organizations have already deemed it important to include digital
literacy and good cyber citizenship in their respective programs and curricula in view of the risks that
the children are exposed to every time they participate in online activities.58 Furthermore,
considering the complexity of the cyber world and its pervasiveness, as well as the dangers that
these children are wittingly or unwittingly exposed to in view of their unsupervised activities in
cyberspace, the participation of the parents in disciplining and educating their children about being a
good digital citizen is encouraged by these institutions and organizations. In fact, it is believed that

to limit such risks, theres no substitute for parental involvement and


supervision.59cralawlawlibrary
As such, STC cannot be faulted for being steadfast in its duty of teaching its students to be
responsible in their dealings and activities in cyberspace, particularly in OSNs, when it enforced the
disciplinary actions specified in the Student Handbook, absent a showing that, in the process, it
violated the students rights.
OSN users should be aware of the risks that they expose themselves to whenever they engage in
cyberspace activities. Accordingly, they should be cautious enough to control their privacy and to
exercise sound discretion regarding how much information about themselves they are willing to give
up. Internet consumers ought to be aware that, by entering or uploading any kind of data or
information online, they are automatically and inevitably making it permanently available online, the
perpetuation of which is outside the ambit of their control. Furthermore, and more importantly,
information, otherwise private, voluntarily surrendered by them can be opened, read, or copied by
third parties who may or may not be allowed access to such.
It is, thus, incumbent upon internet users to exercise due diligence in their online dealings and
activities and must not be negligent in protecting their rights. Equity serves the vigilant. Demanding
relief from the courts, as here, requires that claimants themselves take utmost care in safeguarding a
right which they allege to have been violated. These are indispensable. We cannot afford protection
to persons if they themselves did nothing to place the matter within the confines of their private
zone. OSN users must be mindful enough to learn the use of privacy tools, to use them if they desire
to keep the information private, and to keep track of changes in the available privacy settings, such
as those of Facebook, especially because Facebook is notorious for changing these settings and the
sites layout often.
In finding that respondent STC and its officials did not violate the minors privacy rights, We find no
cogent reason to disturb the findings and case disposition of the court a quo.
In light of the foregoing, the Court need not belabor the other assigned errors.
WHEREFORE, premises considered, the petition is hereby DENIED. The Decision dated July 27, 2012 of
the Regional Trial Court, Branch 14 in Cebu City in SP. Proc. No. 19251-CEB is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.cralawred
Peralta, Villarama, Jr., Reyes, and Jardeleza, JJ., concur.

ARTICLE 31- INDEPENDENT CIVIL ACTION


RULE 111, SEC. 3 REVISED RULES OF COURTS
Sec. 3. When civil action may proceed independently. In the cases provided in Articles 32, 33, 34
and 2176 of the Civil Code of the Philippines, the independent civil action may be brought by the
offended party. It shall proceed independently of the criminal action and shall require only a
preponderance of evidence. In no case, however, may the offended party recover damages twice for
the same act or omission charged in the criminal action.
[G.R. Nos. 160054-55. July 21, 2004]
MANOLO P. SAMSON, petitioner, vs. HON. REYNALDO B. DAWAY, in his capacity as Presiding Judge,
Regional Trial Court of Quezon City, Branch 90, PEOPLE OF THE PHILIPPINES and CATERPILLAR,
INC., respondents.
DECISION

YNARES-SANTIAGO, J.:
Assailed in this petition for certiorari is the March 26, 2003 Order[1] of the Regional Trial Court of
Quezon City, Branch 90, which denied petitioners (1) motion to quash the information; and (2) motion
for reconsideration of the August 9, 2002 Order denying his motion to suspend the arraignment and
other proceedings in Criminal Case Nos. Q-02-108043-44. Petitioner also questioned its August 5,
2003 Order[2] which denied his motion for reconsideration.
The undisputed facts show that on March 7, 2002, two informations for unfair competition under
Section 168.3 (a), in relation to Section 170, of the Intellectual Property Code (Republic Act No. 8293),
similarly worded save for the dates and places of commission, were filed against petitioner Manolo P.
Samson, the registered owner of ITTI Shoes. The accusatory portion of said informations read:
That on or about the first week of November 1999 and sometime prior or subsequent thereto, in
Quezon City, Philippines, and within the jurisdiction of this Honorable Court, above-named accused,
owner/proprietor of ITTI Shoes/Mano Shoes Manufactuirng Corporation located at Robinsons Galleria,
EDSA corner Ortigas Avenue, Quezon City, did then and there willfully, unlawfully and feloniously
distribute, sell and/or offer for sale CATERPILLAR products such as footwear, garments, clothing, bags,
accessories and paraphernalia which are closely identical to and/or colorable imitations of the
authentic Caterpillar products and likewise using trademarks, symbols and/or designs as would cause
confusion, mistake or deception on the part of the buying public to the damage and prejudice of
CATERPILLAR, INC., the prior adopter, user and owner of the following internationally: CATERPILLAR,
CAT, CATERPILLAR & DESIGN, CAT AND DESIGN, WALKING MACHINES and TRACK-TYPE TRACTOR &
DESIGN.
CONTRARY TO LAW.[3]
On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in view of
the existence of an alleged prejudicial question involved in Civil Case No. Q-00-41446 for unfair
competition pending with the same branch; and also in view of the pendency of a petition for review
filed with the Secretary of Justice assailing the Chief State Prosecutors resolution finding probable
cause to charge petitioner with unfair competition. In an Order dated August 9, 2002, the trial court
denied the motion to suspend arraignment and other proceedings.
On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for
reconsideration of the order denying motion to suspend, this time challenging the jurisdiction of the
trial court over the offense charged. He contended that since under Section 170 of R.A. No. 8293, the
penalty5 of imprisonment for unfair competition does not exceed six years, the offense is cognizable
by the Municipal Trial Courts and not by the Regional Trial Court, per R.A. No. 7691.
In its assailed March 26, 2003 Order, the trial court denied petitioners twin motions.6 A motion for
reconsideration thereof was likewise denied on August 5, 2003.
Hence, the instant petition alleging that respondent Judge gravely abused its discretion in issuing the
assailed orders.
The issues posed for resolution are (1) Which court has jurisdiction over criminal and civil cases for
violation of intellectual property rights? (2) Did the respondent Judge gravely abuse his discretion in
refusing to suspend the arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44 on
the ground of (a) the existence of a prejudicial question; and (b) the pendency of a petition for review
with the Secretary of Justice on the finding of probable cause for unfair competition?
Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for
infringement of registered marks, unfair competition, false designation of origin and false description
or representation, is imprisonment from 2 to 5 years and a fine ranging from Fifty Thousand Pesos to
Two Hundred Thousand Pesos, to wit:
SEC. 170. Penalties. Independent of the civil and administrative sanctions imposed by law, a criminal
penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand
pesos (P50,000.00) to Two hundred thousand pesos (P200,000.00), shall be imposed on any person

who is found guilty of committing any of the acts mentioned in Section 155 [Infringement], Section
168 [Unfair Competition] and Section 169.1 [False Designation of Origin and False Description or
Representation].
Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under
Sections 150, 155, 164, 166, 167, 168 and 169 shall be brought before the proper courts with
appropriate jurisdiction under existing laws, thus
SEC. 163. Jurisdiction of Court. All actions under Sections 150, 155, 164 and 166 to 169 shall be
brought before the proper courts with appropriate jurisdiction under existing laws. (Emphasis
supplied)
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark
Law) which provides that jurisdiction over cases for infringement of registered marks, unfair
competition, false designation of origin and false description or representation, is lodged with the
Court of First Instance (now Regional Trial Court)
SEC. 27. Jurisdiction of Court of First Instance. All actions under this Chapter [V Infringement] and
Chapters VI [Unfair Competition] and VII [False Designation of Origin and False Description or
Representation], hereof shall be brought before the Court of First Instance.
We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. No. 8293.
The repealing clause of R.A. No. 8293, reads
SEC. 239. Repeals. 239.1. All Acts and parts of Acts inconsistent herewith, more particularly Republic
Act No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised
Penal Code; Presidential Decree No. 49, including Presidential Decree No. 285, as amended, are
hereby repealed. (Emphasis added)
Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, it
would not have used the phrases parts of Acts and inconsistent herewith; and it would have simply
stated Republic Act No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and
189 of the Revised Penal Code; Presidential Decree No. 49, including Presidential Decree No. 285, as
amended are hereby repealed. It would have removed all doubts that said specific laws had been
rendered without force and effect. The use of the phrases parts of Acts and inconsistent herewith only
means that the repeal pertains only to provisions which are repugnant or not susceptible of
harmonization with R.A. No. 8293.7 Section 27 of R.A. No. 166, however, is consistent and in harmony
with Section 163 of R.A. No. 8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of
intellectual property rights with the Metropolitan Trial Courts, it would have expressly stated so under
Section 163 thereof.
Moreover, the settled rule in statutory construction is that in case of conflict between a general law
and a special law, the latter must prevail. Jurisdiction conferred by a special law to Regional Trial
Courts must prevail over that granted by a general law to Municipal Trial Courts.8
In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws9 conferring jurisdiction over
violations of intellectual property rights to the Regional Trial Court. They should therefore prevail over
R.A. No. 7691, which is a general law.10 Hence, jurisdiction over the instant criminal case for unfair
competition is properly lodged with the Regional Trial Court even if the penalty therefor is
imprisonment of less than 6 years, or from 2 to 5 years and a fine ranging from P50,000.00 to
P200,000.00.
In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual
property rights under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19, 2002
designating certain Regional Trial Courts as Intellectual Property Courts. On June 17, 2003, the Court
further issued a Resolution consolidating jurisdiction to hear and decide Intellectual Property Code
and Securities and Exchange Commission cases in specific Regional Trial Courts designated as Special
Commercial Courts.

The case of Mirpuri v. Court of Appeals,11 invoked by petitioner finds no application in the present
case. Nowhere in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed by R.A. No. 8293.
Neither did we make a categorical ruling therein that jurisdiction over cases for violation of
intellectual property rights is lodged with the Municipal Trial Courts. The passing remark in Mirpuri on
the repeal of R.A. No. 166 by R.A. No. 8293 was merely a backgrounder to the enactment of the
present Intellectual Property Code and cannot thus be construed as a jurisdictional pronouncement in
cases for violation of intellectual property rights.
Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial
question. In his petition, he prayed for the reversal of the March 26, 2003 order which sustained the
denial of his motion to suspend arraignment and other proceedings in Criminal Case Nos. Q-02108043-44. For unknown reasons, however, he made no discussion in support of said prayer in his
petition and reply to comment. Neither did he attach a copy of the complaint in Civil Case No. Q-0041446 nor quote the pertinent portion thereof to prove the existence of a prejudicial question.
At any rate, there is no prejudicial question if the civil and the criminal action can, according to law,
proceed independently of each other.12 Under Rule 111, Section 3 of the Revised Rules on Criminal
Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent
civil action may be brought by the offended party. It shall proceed independently of the criminal
action and shall require only a preponderance of evidence.
In the case at bar, the common element in the acts constituting unfair competition under Section 168
of R.A. No. 8293 is fraud.13 Pursuant to Article 33 of the Civil Code, in cases of defamation, fraud, and
physical injuries, a civil action for damages, entirely separate and distinct from the criminal action,
may be brought by the injured party. Hence, Civil Case No. Q-00-41446, which as admitted14 by
private respondent also relate to unfair competition, is an independent civil action under Article 33 of
the Civil Code. As such, it will not operate as a prejudicial question that will justify the suspension of
the criminal cases at bar.
Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides
SEC. 11. Suspension of arraignment. Upon motion by the proper party, the arraignment shall be
suspended in the following cases
xxxxxxxxx
(c) A petition for review of the resolution of the prosecutor is pending at either the Department of
Justice, or the Office of the President; Provided, that the period of suspension shall not exceed sixty
(60) days counted from the filing of the petition with the reviewing office.
While the pendency of a petition for review is a ground for suspension of the arraignment, the
aforecited provision limits the deferment of the arraignment to a period of 60 days reckoned from the
filing of the petition with the reviewing office. It follows, therefore, that after the expiration of said
period, the trial court is bound to arraign the accused or to deny the motion to defer arraignment.
In the instant case, petitioner failed to establish that respondent Judge abused his discretion in
denying his motion to suspend. His pleadings and annexes submitted before the Court do not show
the date of filing of the petition for review with the Secretary of Justice.15 Moreover, the Order dated
August 9, 2002 denying his motion to suspend was not appended to the petition. He thus failed to
discharge the burden of proving that he was entitled to a suspension of his arraignment and that the
questioned orders are contrary to Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure.
Indeed, the age-old but familiar rule is that he who alleges must prove his allegations.
In sum, the dismissal of the petition is proper considering that petitioner has not established that the
trial court committed grave abuse of discretion. So also, his failure to attach documents relevant to
his allegations warrants the dismissal of the petition, pursuant to Section 3, Rule 46 of the Rules of
Civil Procedure, which states:
SEC. 3. Contents and filing of petition; effect of non-compliance with requirements. The petition shall
contain the full names and actual addresses of all the petitioners and respondents, a concise

statement of the matters involved, the factual background of the case, and the grounds relied upon
for the relief prayed for.
It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the
respondent with the original copy intended for the court indicated as such by the petitioner, and shall
be accompanied by a clearly legible duplicate original or certified true copy of the judgment, order,
resolution, or ruling subject thereof, such material portions of the record as are referred to therein,
and other documents relevant or pertinent thereto.
xxxxxxxxx
The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient
ground for the dismissal of the petition. (Emphasis added)
WHEREFORE, in view of all the foregoing, the petition is DISMISSED.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Quisumbing, Carpio, and Azcuna, JJ., concur.

SECOND DIVISION
[G.R. No. 122150. March 17, 2003]
George (Culhi) Hambon, petitioner, vs. Court of Appeals and Valentino U. Carantes, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Petitioner George (Culhi) Hambon filed herein petition for review on certiorari, raising the following
issues:
WHETHER OR NOT A CIVIL CASE FOR DAMAGES BASED ON AN INDEPENDENT CIVIL ACTION FALLING
UNDER ARTICLE 32, 33, 34 AND 2176 OF THE NEW CIVIL CODE BE DULY DISMISSED FOR FAILURE TO
MAKE RESERVATION TO FILE A SEPARATE CIVIL ACTION IN A CRIMINAL CASE FILED ARISING FROM THE
SAME ACT OR OMISSION OF THE ACCUSED PURSUANT TO RULE 111, SECTION 1 OF THE RULES OF
COURT, THE FAILURE TO MAKE RESERVATION BEING DUE TO THE FACT THAT THE CRIMINAL CASE WAS
DISMISSED BEFORE THE PROSECUTION STARTED TO PRESENT EVIDENCE FOR FAILURE OF THE
PRIVATE COMPLAINANT TO APPEAR DESPITE NOTICE
SHOULD A STRICT INTERPRETATION OF RULE 111, SECTION 1 OF THE RULES OF COURT WHICH
INFRINGES ON A RIGHT OF A PARTY BASED ON A SUBSTANTIVE LAW BE PERMITTED WHEN TO DO SO
WOULD DIMINISH, MODIFY AND/OR AMEND A SUBSTANTIVE RIGHT CONTRARY TO LAW.[1]
The factual background that led to the filing of the petition is as follows:
On June 6, 1989, the petitioner filed before the Regional Trial Court of Baguio (Branch 6), a complaint
for damages[2] for the injuries and expenses he sustained after the truck driven by the respondent
bumped him on the night of December 9, 1985.[3] In answer thereto, respondent contended that the
criminal case arising from the same incident, Criminal Case No. 2049 for Serious Physical Injuries thru
Reckless Imprudence, earlier filed on January 8, 1986,[4] had already been provisionally dismissed by
the Municipal Trial Court of Tuba, Benguet on March 23, 1987, due to petitioners lack of interest;
[5] and that the dismissal was with respect to both criminal and civil liabilities of respondent.[6]
After trial, the Regional Trial Court rendered a decision, dated December 18, 1991, ruling that the civil
case was not barred by the dismissal of the criminal case, and that petitioner is entitled to
damages. The dispositive portion of the RTC decision reads:

WHEREFORE, Judgment is hereby rendered, sentencing defendant Valentino Cerantes to pay plaintiff
George Hambon the sum of P60,000.00 for hospitalization and medical expenses and P10,000.00 for
native rituals, as Actual Damages; the sum of P10,000.00 as Moral Damages, P5,000.00 as Exemplary
Damages and P5,000.00 as Attorneys fees and costs.
SO ORDERED.[7]
On appeal,[8] the Court of Appeals, in its decision promulgated on March 8, 1995,[9] reversed and set
aside the decision of the trial court, and dismissed petitioners complaint for damages.
According to the appellate court, since the petitioner did not make any reservation to institute a
separate civil action for damages, it was impliedly instituted with the criminal case, and the dismissal
of the criminal case carried with it the dismissal of the suit for damages, notwithstanding the fact that
the dismissal was provisional as it amounted to an acquittal and had the effect of an adjudication on
the merits. [10]
Hence, herein petition for review on certiorari under Rule 45 of the Rules of Court.
Petitioner argues that the ruling in the case of Abellana v. Marave[11] should be observed, i.e., a civil
action for damages may be filed and proceed independently of the criminal action even without
reservation to file the same has been made;[12] and that the requirement of reservation, as provided
in Rule 111 of the Rules of Court, practically diminished/amended/modified his substantial right.[13]
The petition must be denied.
Petitioner filed the complaint for damages on June 6, 1989. Hence, Section 1, Rule 111 of the 1985
Rules on Criminal Procedure, as amended in 1988,[14] is the prevailing and governing law in this
case, viz.:
SECTION 1. Institution of criminal and civil actions. When a criminal action is instituted, the civil
action for the recovery of civil liability is impliedly instituted with the criminal action, unless the
offended party waives the civil action, reserves his right to institute it separately, or institutes the civil
action prior to the criminal action.
Such civil action includes recovery of indemnity under the Revised Penal Code, and damages under
Article 32, 33, 34 and 2176 of the Civil Code of the Philippines arising from the same act or omission
of the accused.
...
Under the foregoing rule, civil actions to recover liability arising from crime (ex delicto) and under
Articles 32, 33, 34 and 2176 of the Civil Code (quasi-delict) are deemed impliedly instituted with the
criminal action unless waived, reserved or previously instituted.
Thus, in Maniago v. Court of Appeals,[15] the Court ruled that the right to bring an action for damages
under the Civil Code must be reserved, as required by Section 1, Rule 111, otherwise it should be
dismissed;[16] and that the reservation requirement does not impair, diminish or defeat substantive
rights, but only regulates their exercise in the general interest of orderly procedure.[17]
In the Maniago case, petitioner Ruben Maniago was the owner of the bus driven by Herminio Andaya
that figured in a vehicular accident with the jeepney owned by respondent Alfredo Boado. The
petitioner therein initially sought for the suspension of the civil case for damages filed against him in
view of the pendency of the criminal case for reckless imprudence resulting in damage to property
and multiple physical injuries filed against his driver. The respondent, in the criminal case, did not
reserve the right to bring the separate civil action against the petitioner or his driver. The criminal
case was later dismissed for the failure of the prosecution to prosecute its case. On appeal, the Court
identified the issues as (1) whether the respondent can file a civil action for damages despite the
absence of reservation; (2) whether the dismissal of the criminal case brought with it the dismissal of
the civil action; and (3) whether the reservation requirement is substantive in character and beyond
the rule-making power of the Court.[18]

The Court expounded:


. . . 1quite clearly requires that a reservation must be made to institute separately all civil actions for
the recovery of civil liability, otherwise they will de deemed to have been instituted with the criminal
case. In other words the right of the injured party to sue separately for the recovery of the civil
liability whether arising from crimes (ex delicto) or from quasi-delict under Art. 2176 of the Civil Code
must be reserved otherwise they will de deemed instituted with the criminal action.
...
Contrary to private respondents contention, the requirement that before a separate civil action may
be brought it must be reserved does not impair, diminish or defeat substantive rights, but only
regulates their exercise in the general interest of procedure. The requirement is merely procedural in
nature. For that matter the Revised Penal Code, by providing in Art. 100 that any person criminally
liable is also civilly liable, gives the offended party the right to bring a separate civil action, yet no
one has ever questioned the rule that such action must be reserved before it may be brought
separately.[19]
While the Abellana case ruled that a reservation is not necessary, the 1988 amendment of the rule
explicitly requires reservation of the civil action.
x x x Prior reservation is a condition sine qua non before any of these independent civil actions can be
instituted and thereafter have a continuous determination apart from or simultaneous with the
criminal action.
. . . Far from altering substantive rights, the primary purpose of the reservation is, to borrow the
words of the Court in "Caos v. Peralta":
. . . to avoid multiplicity of suits, to guard against oppression and abuse, to prevent delays, to clear
congested dockets, to simplify the work of the trial court; in short, the attainment of justice with the
least expense and vexation to the parties-litigants.[20]
Thus, herein petitioner Hambon should have reserved his right to separately institute the civil action
for damages in Criminal Case No. 2049. Having failed to do so, Civil Case No. 1761-R for damages
subsequently filed by him without prior reservation should be dismissed. With the dismissal of
Criminal Case No. 2049, whatever civil action for the recovery of civil liability that was impliedly
instituted therein was likewise dismissed.
WHEREFORE, the instant petition for review on certiorari is hereby DENIED for lack of merit, and the
decision of the Court of Appeals dated March 8, 1995, is AFFIRMED in toto.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Quisumbing and Callejo, Sr., JJ., concur.
ARTICLE 36- PREJUDICIAL QUESTION

RULE 111, Revised Rules of Court


Sec. 5. Resolution of investigating judge and its review.
Within ten (10) days after the preliminary investigation, the investigating judge shall transmit the
resolution of the case to the provincial or city prosecutor, or to the Ombudsman or his deputy in cases
of offenses cognizable by the Sandiganbayan in the exercise of its original jurisdiction, for appropriate
action. The resolution shall state the findings of facts and the law supporting his action, together with
the record of the case which shall include: (a) the warrant, if the arrest is by virtue of a warrant; (b)
the affidavits, counter-affidavits and other supporting evidence of the parties; (c) the undertaking or
bail of the accused and the order for his release; (d) the transcripts of the proceedings during the

preliminary investigation; and (e) the order of cancellation of his bail bond, if the resolution is for the
dismissal of the complaint.
Within thirty (30) days from receipt of the records, the provincial or city prosecutor, or the
Ombudsman or his deputy, as the case may be, shall review the resolution of the investigating judge
on the existence of probable cause. Their ruling shall expressly and clearly state the facts and the law
on which it is based and the parties shall be furnished with copies thereof. They shall order the
release of an accused who is detained if no probable cause is found against him.
Sec. 6. When warrant of arrest may issue. (a) By the Regional Trial Court. Within ten (10) days
from the filing of the complaint or information, the judge shall personally evaluate the resolution of
the prosecutor and its supporting evidence. He may immediately dismiss the case if the evidence on
record clearly fails to establish probable cause. If he finds probable cause, he shall issue a warrant of
arrest, or a commitment order if the accused has already been arrested pursuant to a warrant issued
by the judge who conducted the preliminary investigation or when the complaint or information was
filed pursuant to section 7 of this Rule. In case of doubt on the existence of probable cause, the judge
may order the prosecutor to present additional evidence within five (5) days from notice and the issue
must be resolved by the court within thirty (30) days from the filing of the complaint of
information. chan robles virtual law library
(b) By the Municipal Trial Court. When required pursuant to the second paragraph of section of this
Rule, the preliminary investigation of cases falling under the original jurisdiction of the Metropolitan
Trial Court, Municipal Trial Court in Cities, Municipal Trial Court, or Municipal Circuit Trial Court may be
conducted by either the judge or the prosecutor. When conducted by the prosecutor, the procedure
for the issuance of a warrant of arrest by the judge shall be governed by paragraph (a) of this section.
When the investigation is conducted by the judge himself, he shall follow the procedure provided in
section 3 of this Rule. If his findings and recommendations are affirmed by the provincial or city
prosecutor, or by the Ombudsman or his deputy, and the corresponding information is filed, he shall
issue a warrant of arrest. However, without waiting for the conclusion of the investigation, the judge
may issue a warrant of arrest if he finds after an examination in writing and under oath of the
complainant and his witnesses in the form of searching questions and answers, that a probable cause
exists and that there is a necessity of placing the respondent under immediate custody in order not to
frustrate the ends of justice.
(c) When warrant of arrest not necessary. A warrant of arrest shall not issue if the accused is
already under detention pursuant to a warrant issued by the municipal trial court in accordance with
paragraph (b) of this section, or if the complaint or information was filed pursuant to section 7 of this
Rule or is for an offense penalized by fine only. The court shall them proceed in the exercise of its
original jurisdiction.

SECOND DIVISION
PEOPLE OF THE PHILIPPINES, G.R. No. 141624
Petitioner,
Present:
PUNO, J., Chairman,
AUSTRIA-MARTINEZ,
- versus - CALLEJO, SR.,
TINGA, and
CHICO-NAZARIO, JJ.

Promulgated:
HERNANDO B. DELIZO,
Respondent. August 17, 2004
DECISION
CALLEJO, SR., J.:
Before us is a petition for review on certiorari of the Decision[1] of the Court of Appeals in CA-G.R. SP
No. 50995 granting the petition for certiorari of respondent Dr. Hernando B. Delizo and nullifying the
December 18, 1998 and February 1, 1999 Orders[2] of the Regional Trial Court of Mandaluyong City in
Criminal Case No. 167-MD for estafa.
The Antecedents
Arsenio T. Ng filed a criminal complaint for estafa against the respondent with the Office of the City
Prosecutor of Mandaluyong City, docketed as Inv. Slip No. 97-10288. After the requisite preliminary
investigation, First Assistant City Prosecutor Esteban A. Tacla, Jr. signed an Information dated October
10, 1997, charging the respondent with estafa. The accusatory portion of the Information reads:
That on or about the 24th day of October, 1996, in the City of Mandaluyong, Philippines, a place
within the jurisdiction of this Honorable Court, the above-named accused, being then President and
Chairman of Mediserv, Inc., by means of deceit, false pretenses and fraudulent representation,
executed prior to or simultaneously with the commission of the fraud, succeeded in inducing herein
complainant, Arsenio T. Ng to give the amount of P12 Million, to the accused on his pretext that said
amount will be converted by him into shares of stock (120,000 shares of stocks) and in order to
complement such false pretenses or fraudulent acts, he (respondent) even showed a Board
Resolution defining his authority to contract loan from the complainant and the conversion of such
loan into shares of stock, which, on the strength by said manifestations and representations, the
complainant gave said amount and duly received by the accused, he knowing fully well that the same
were false and fraudulent and were only made to entice complainant into believing that he, indeed, is
empowered and in a position to issue the equivalent number of shares of stocks (120,000) in order to
obtain, as in fact, he (accused) obtained the total amount of P12 Million from the complainant and the
accused, once in possession of the money, far from complying with his obligation to release the
120,000 shares of stocks into complainants name, despite demands made on him and, with intent to
defraud, did then and there willfully, unlawfully and feloniously misappropriate, misapply and convert
said amount, to his own personal use and benefit, to the damage and prejudice of Arsenio T. Ng, in
the aforementioned amount of P12 Million.
CONTRARY TO LAW.[3]
Before the Information was filed, the Ambulatory Health Care Institute, Inc. (AHCII), also known as
Clinica Manila (CM), and the Health Check, Inc. (HCI) filed a Complaint on October 22, 1997 with the
Securities and Exchange Commission (SEC) against the respondent and a certain John Doe for
injunction and damages. The case was docketed as SEC Case No. 10-97-5794. The petitioners therein
alleged, inter alia, that a special meeting of the stockholders of CM was held on October 9, 1997 after
due notice to the respondent two weeks before the said date. During the said meeting, the
stockholders elected a new board of directors, replacing the respondent as CM president. Thereafter,
at 3:00 p.m. of October 13, 1997, the respondent and an unidentified companion arrived at the CM
office at SM Megamall, announced that he was still the president, and rallied the officers and
employees against the new board of directors. Despite the security guards request for him to leave
the premises, the respondent refused to do so. He, thereafter, wrote the China Banking Corporation,
the depository bank of CM, requesting it not to honor any change in the authorized signatories for CM,
and appended thereto a falsified General Information Sheet (GIS) to show that he was still a member
of the board of directors and president of CM. It was prayed that, after due proceedings, judgment be
rendered:

WHEREFORE, it is respectfully prayed of this Honorable Commission to adjudge that respondent be


ordered:
1. Not to do any act or deed that will disturb or interfere with the operations and business of the
petitioners, and not to cause any alarm, scandal, disturbance, intrigue, disloyalty, disorder, or
defiance on the part of any (sic) employees, officers, contractors, workers of CLINICA MANILA and
HEALTH CHECK, INC.;
2. Not to do any act that will interfere with or disturb the management and operation of the funds,
bank accounts, receivables, and all other property transactions of the petitioners, and to stop
representing themselves as having any kind of power and authority over any asset of the two
companies and their management;
3. Not to do any act or deed, directly or indirectly, that will dishonor the name and reputation of the
petitioners;
4. To pay actual damages of P1,000,000; moral damages of P2,000,000; and exemplary damages
of P500,000; and to pay the costs of suit.[4]
On October 23, 1997, AHCII, Mediserv, Inc. (MI) and the respondent, filed a Complaint with the SEC
against Arsenio T. Ng, Kelly S. Salvador, Antonio Roberto M. Abaya, Bartolome C. Felipe, Jr., Joel
Abanilla and Nonette C. Mina. The complainants alleged, inter alia, that they had been stockholders of
AHCII since August 1995, and represented a majority of the outstanding capital stock, owning 52.37%
and 6.08%, respectively, as shown by the GIS dated October 15, 1997 filed with the SEC; the
respondent was the incumbent chairman of the board of directors and president of AHCII; and there
was no quorum during the stockholders meeting of October 9, 1997; as such, the said meeting where
a new set of board of directors and officers were, elected was in violation of the by-laws of the
complainant AHCII and, consequently, illegal. The complainants prayed that the following reliefs be
granted after due proceedings:
a)

Declaring the Writ of Preliminary Injunction earlier issued as permanent;

b)
Adjudging the Special Stockholders Meeting purportedly held on October 9, 1997 as null and
void ab initio;
c)
Adjudging any action, proceeding, resolution, and/or election made in the alleged stockholders
meeting purportedly held on October 9, 1997 as null and void ab initio;
d)
Adjudging respondents Arsenio T. Ng, Kelly S. Salvador, Antonio Roberto M. Abaya, Bartolome C.
Felipe, Jr., Joel Abanilla and Nonette C. Mina, jointly and severally, liable to pay to complainant Delizo
moral damages of not less than P1,000,000.00;
e)
Adjudging respondents Arsenio T. Ng, Kelly S. Salvador, Antonio Roberto M. Abaya, Bartolome C.
Felipe, Jr., Joel Abanilla and Nonette C. Mina, jointly and severally, liable to pay to the complainants,
as follows:
i.

Exemplary damages of not less than P500,000.00;

ii.

Actual damages not less than P250,000.00;

iii.

Attorneys fee of P200,000.00;

iv.

Costs of litigation.

Other equitable reliefs are prayed for.[5]


The case was docketed as SEC Case No. 10-97-5796.
In the meantime, Mediserv, Inc., represented by its president, the respondent, and its treasurer,
Marissa D. Delizo, filed a complaint with the RTC of Manila, Branch 29, against the China Banking

Corporation, the Landheights (Iloilo) Development Corporation, Notary Public Romeo A. Ignacio, Jr.
and the Registrar of Deeds for the City of Manila. An amended complaint was later filed, where it was
alleged, inter alia, that MI received a loan from the bank in the amount of P9,820,000, later increased
to P11,200,000. To secure the payment of the said loan, MI executed a real estate mortgage and
amendment to real estate mortgage over its property covered by Transfer Certificate of Title (TCT) No.
205824 of the Register of Deeds of Manila. MI also executed a promissory note on October 5, 2000 in
favor of the bank in the amount of P11,200,000. The bank, thereafter, foreclosed the mortgage and
sold the property at public auction in favor of the bank for P15,649,023.29, through defendant Notary
Public Romeo A. Ignacio, Jr. It was prayed that, after due proceedings, it be granted the following
reliefs:
WHEREFORE, it is most respectfully prayed of this Honorable Court that:
1. Immediately upon filing of this Complaint, this Honorable Court issues a Writ of Preliminary
Injunction, or at least a Temporary Restraining Order enjoining and restraining defendant Register of
Deeds from effecting/allowing the registration or annotation of the purported auction sale of plaintiffs
property covered by TCT No. 205824 of the Register of Deeds for the City of Manila in favor of
defendant Landheights, or any transaction, dealing or incident arising from the purported auction sale
allegedly conducted by defendant Ignacio until further orders from this Honorable Court.
2. After hearing, to render Judgment, as follows:
a.

Declaring the Writ of Preliminary Injunction earlier issued as permanent;

b.
Declaring the alleged public auction sale conducted by defendant Ignacio over the
subject plaintiffs property, as null and void;
c.
Ordering and commanding Defendant China Bank to comply and to reduce into writing
and/or to document its agreement with plaintiff to consolidate the first P5 million loan of plaintiff with
it with the plaintiffs second loan of P1,800,000.00;
d.
Adjudging defendants China Banking Corporation, Landheights (Iloilo) Development
Corporation and Romeo A. Ignacio, Jr., jointly and severally, liable to pay to plaintiff the following:
1.

Attorneys Fees in the amount of P200,000.00; and

2.

Costs of suit.

Other equitable reliefs are prayed for.[6]


The case was docketed as Civil Case No. Q-97-86152.
On December 3, 1997, the Information for estafa against the respondent was filed with the RTC of
Mandaluyong City and raffled to Branch 214. The case was docketed as Criminal Case No. 167MD.The private prosecutor filed an ex parte motion for preliminary attachment, which was opposed
by the respondent. On December 18, 1998, the trial court issued an Order[7] directing the issuance of
a writ of preliminary attachment on a bond of P8,000,000. The respondent filed a motion for
reconsideration of the order with a prayer for the suspension of the proceedings on the ground of the
existence of a prejudicial question on December 23, 1998.
As early as January 13, 1998, the trial court in Branch 213 issued an Order denying the motion to
suspend proceedings on the ground that the private complainant, Arsenio T. Ng, was not a
stockholder of MI; hence, the pendency of the two (2) SEC cases was not a ground for the suspension
of the case. On February 1, 1999, the trial court issued the assailed Order denying the motion for
reconsideration.
On February 19, 1999, the respondent filed a Petition for Certiorari with the Court of Appeals,
docketed as CA-G.R. SP No. 50995, for the nullification of the Orders of the trial court, contending as
follows:

6.A.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN ORDERING THE ISSUANCE OF A WRIT OF PRELIMINARY ATTACHMENT
GROSSLY IGNORING THE ESTABLISHED RULE THAT APPLICATIONS FOR A WRIT OF PRELIMINARY
ATTACHMENT MUST BE STRICTLY CONSTRUED AGAINST THE APPLICANT AND LIBERALLY IN FAVOR OF
THE PARTY AGAINST WHOM IT IS DIRECTED.
6.B.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN ORDERING THE ISSUANCE OF THE PRELIMINARY ATTACHMENT DESPITE
THE CLEAR SHOWING THAT THE CIVIL ASPECT OF THE CRIMINAL CASE IS ALREADY COVERED BY
CASES BEFORE THE SECURITIES AND EXCHANGE COMMISSION AND THE REGIONAL TRIAL COURT OF
MANILA; HENCE, THERE IS NO CIVIL ASPECT ATTACHED AND/OR DEEMED INSTITUTED WITH THE
CRIMINAL CASE.
6.C.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN ORDERING THE ISSUANCE OF A WRIT OF PRELIMINARY ATTACHMENT ON
A P12 MILLION CLAIM PER THE INFORMATION WITH ONLY P8 MILLION BOND; HENCE, GROSSLY
INSUFFICIENT, IMPROPER AND UNREASONABLE.
6.D.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN MERELY RELYING ON THE ALLEGATIONS OF THE EX PARTEMOTION FOR
ISSUANCE OF A WRIT OF PRELIMINARY ATTACHMENT WHICH ARE NOT SUPPORTED BY AFFIDAVIT/S AS
REQUIRED UNDER THE RULES.
6.E.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN NOT SUSPENDING THE PROCEEDINGS IN THE SUBJECT CRIMINAL CASE IN
VIEW OF THE PRESENCE OF PREJUDICIAL QUESTIONS IN THE SEC CASES AND THE RTC CASE WHICH
ARE DETERMINATIVE OF THE INNOCENCE OR GUILT OF THE ACCUSED, THE HEREIN PETITIONER.
6.F.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN DENYING THE MOTION TO DISQUALIFY PRIVATE PROSECUTOR BEFORE THE
SAID MOTION CAN BE HEARD; HENCE, A CLEAR AND PALPABLE VIOLATION OF DUE PROCESS.
6.G.) THE RESPONDENT JUDGE GRAVELY ABUSED HIS DISCRETION AND ACTED IN EXCESS AND/OR
WITHOUT JURISDICTION IN NOT DISQUALIFYING THE PRIVATE PROSECUTOR DESPITE THE CLEAR
SHOWING THAT THE CIVIL ASPECT OF THE SUBJECT CRIMINAL CASE IS PRESENTLY LITIGATED AND/OR
THE SUBJECT OF SEPARATE ACTIONS BEFORE THE SEC AND THE RTC.[8]
On January 18, 2000, the CA rendered a Decision granting the petition and nullifying the assailed
Orders of the trial court, as well as the writ of preliminary attachment it issued. The fallo of the
decision reads:
WHEREFORE, the petition is given due course. The assailed Orders of December 18, 1998 and
February 1, 1999, as well as the writ of attachment are hereby set aside. The respondent Judge of the
Regional Trial Court, Mandaluyong City, Branch 214, is hereby directed to suspend proceedings of
Criminal Case No. 167-MD considering the existence of a prejudicial question in SEC Cases Nos. 1097-5794 and 10-97-5796 and Civil Case No. 97-86152.
SO ORDERED.[9]
The Present Petition
The People of the Philippines, now the petitioner, filed its petition for review on certiorari with this
Court, on the following grounds:
Public interest requires that all criminal acts be immediately investigated and prosecuted for the
protection of society (Gorospe vs. Pana Florida, 101 SCRA 445). Thus, the suspension of criminal
proceedings must be avoided unless the basis and grounds thereof are clear and unmistakable.
The finding of the trial court that the criminal case, the civil case filed with the Regional Trial Court
(RTC) at Manila and the cases filed with the Securities and Exchange Commission (SEC) are based on

the same transaction is grounded entirely on speculation. The complaints filed with the RTC and SEC
cases do not support such finding.
Moreover, in ruling that a prejudicial question exists, the court based its finding solely on its
conclusion that the criminal, civil and SEC cases arose out of the same transaction. This is contrary to
Sec. 5, Rule 111 of the Rules of Court and the ruling of the Supreme Court that for a civil case to be
considered prejudicial to a criminal action, it must appear not only that the civil case involves the
same facts upon which the criminal prosecution is based, but also that the resolution of the issues
raised in said civil action would be necessarily determinative of the guilt or innocence of the accused
(Ras vs. Rasul, 100 SCRA 125).[10]
The petitioner, thus, raises the following issues for resolution:
I
WHETHER OR NOT THE CRIMINAL, CIVIL AND SEC CASES ARE BASED ON THE SAME TRANSACTION.
II
WHETHER OR NOT THE CASES FILED WITH THE SEC AND THE CIVIL CASE FILED WITH THE RTC RAISE
PREJUDICIAL QUESTIONS WHICH WOULD NECESSITATE THE SUSPENSION OF THE CRIMINAL ACTION
FOR ESTAFA.
Central to the issues in the case at bar are Sections 5 and 6, Rule 111 of the Rules of Court,[11] which
read:
Sec. 5. Elements of prejudicial question. The two (2) essential elements of a prejudicial question are:
(a) the civil action involves an issue similar or intimately related to the issue raised in the criminal
action; and (b) the resolution of such issue determines whether or not the criminal action may
proceed.
Sec. 6. Suspension by reason of prejudicial question. A petition for suspension of the criminal action
based upon the pendency of a prejudicial question in a civil action may be filed in the office of the
fiscal or the court conducting the preliminary investigation. When the criminal action has been filed in
court for trial, the petition to suspend shall be filed in the same criminal action at any time before the
prosecution rests.[12]
The petitioner asserts that the issues involved in Criminal Case No. 167-MD for estafa are entirely
different from and unrelated to the issues in the SEC cases and in Civil Case No. 97-86152 pending
before the RTC of Manila. It asserts that, contrary to the rulings of the appellate court, the said cases
are based on facts and transactions different from those in the criminal case. According to the
petitioner, the resolution of the issues in the SEC and the civil cases are not determinative of the guilt
or innocence of the respondent in the criminal case; hence, the suspension of the proceedings in the
criminal case was barren of factual and legal bases.
On the other hand, the CA held that the P12,000,000 subject of the transaction in the criminal case
was the same amount involved in the SEC cases and the civil case. The CA then concluded that the
issues raised or involved in such cases were determinative of the guilt or innocence of the respondent
in the criminal case, warranting the suspension of the latter case.
The Ruling of the Court
The petition is meritorious.
In case the civil action is instituted ahead of the criminal action, under Section 2, Rule 111 of the
Rules of Court, the civil action shall be suspended in whatever stage it may be found before judgment
on the merits upon the commencement of the criminal action. Such criminal action has precedence
over the civil action to enforce the civil liability of the accused arising from the delict. An exception is
where the prejudicial question exists, under Sections 5 and 6, Rule 111 of the Rules of Court, as
amended.

If the issues raised in a civil action are so similar or intimately related to those in the criminal case
such that the resolution of the said issues in the civil case are determinative of the juris et de jure of
the guilt or innocence of the accused in the criminal case, the proceedings in the latter case shall be
suspended and the civil action shall proceed until judgment on its merits.[13] A prejudicial question is
one based on a fact
distinct and separate from the crime because if both actions arose from the same fact or transaction,
the civil case does not constitute a prejudicial question to the determination of the criminal action.
[14] Neither is there a prejudicial question if the civil and the criminal actions can, according to the
law and rules, proceed independently of each other.[15] The rationale behind the principle of
prejudicial question is to avoid two conflicting decisions.[16]
In this case, the transaction subject of the criminal case for estafa against the respondent is the
receipt of the amount of P12,000,000 from the private complainant, Ng, which was intended for the
purchase of 120,000 shares of stocks of MI. According to the Information in Criminal Case No. 167MD, the respondent used the money for his personal benefit instead of purchasing the said shares in
behalf of Ng. The event or occurrence subject of SEC Case No. 97-5794 filed by the AHCII and the HCI
against the respondent was the latters refusal to vacate the office of the president, and his insistence
on performing and exercising the duties and powers of the said office, as well as the chairmanship of
the board of directors of the said corporation despite his alleged ouster from the said positions. The
plaintiff corporations sought a writ of injunction and relief for damages against the
respondent. Neither Ng nor the MI were parties in the said case. On the other hand, SEC Case No. 975796 was filed by the respondent and several others, for and in representation of the AHCII and the
MI, as the plaintiffs, to nullify the October 9, 1997 stockholders meeting and the election of the board
of directors and officers held thereon, anchored on their claim that they owned majority of the
outstanding capital of the AHCII, and that the said meeting and election subsequently held were null
and void. As in SEC Case No. 97-5794, Ngs projected investment of P12,000,000 in the MI which, as
alleged in the Information, the respondent had misused for his personal benefit, was not the subject
of SEC Case No. 97-5796. There is even no showing in the SEC cases that Ng claimed to be a
stockholder of the MI on account of the respondents receipt of the P12,000,000 for the intended
purchase of 120,000 shares of stocks therein.
These issues are not, in any way, determinative of the guilt or innocence of the respondent in the
criminal case for estafa. Whether the said meeting and elections will be declared null and void by the
SEC will not result in the conviction or acquittal of the respondent for estafa, for swindling Ng
of P12,000,000. Furthermore, the SEC cases involve intra-corporate disputes between the respondent,
on the one hand, and Ng and the other stockholders of the AHCII, on the other, for the control of the
said corporations management. It must be stressed that the petitions before the SEC are bare of
allegations relating to the alleged P12,000,000 received by the respondent from Ng, and intended for
the latters purchase of 120,000 shares of stocks in the MI.
In his petition with the CA, the respondent alleged that in the SEC cases, the MI insisted that
the P12,000,000 received by him was a mere loan; that he would not be liable of estafa if he could
prove the same.[17] According to the respondent, Ng alleged in the said SEC cases that he and the
members of his group became the major and controlling stockholders in AHCII because of the infusion
of P12,000,000 by Ng.On the other hand, the respondent averred in his comment on the instant
petition that the P12,000,000 he received from Ng referred to AHCII shares of stocks owned by MI.
[18] A cursory reading of the Information will show that the P12,000,000 was intended for the
purchase of 120,000 shares of stocks of the MI, and not of the AHCII. Even the CA in its decision
declared that the P12,000,000 was intended for Ngs purchase of shares of stocks in the MI:
As regard the motion to suspend the proceedings in [the] questioned criminal case in view of the
presence of a prejudicial question in the SEC cases, petitioner insists in that the nature of the subject
transaction involving the alleged P12 million of Mr. Cusencio (sic) T. Ng which is the subject of the
case at bar, is, likewise, the subject of the consolidated SEC cases. A perusal of the complaints (p.
79, Rollo) filed with the SEC (SEC Cases Nos. 10-97-5794 and 10-97-5796) and the Regional Trial
Court of Manila shows that there really exists a prejudicial question. It appears, as claimed by private
respondent, that the amount of P12 million subject of the instant Criminal Case for Estafa was given
to petitioner to be diverted into shares of stocks from Mediserv, Inc., while the petitioner averred that

the amount was given as a loan. Thus, it is clear that the nature of the transaction involving the P12
million of private respondent in the criminal case is the same as the cases before the SEC and the
Civil Case Q-97-88152 (sic) in the Regional Trial Court of Manila.[19]
Moreover, the respondent failed to submit to the CA the answer and other pleadings filed by Ng as
well as the pleadings of the stockholders of the AHCII in the SEC cases, containing allegations that
they became the majority and controlling stockholders of the AHCII because of the infusion
of P12,000,000. Such pleadings would have bolstered the respondents stance in this case, and
debilitated that of the petitioner herein.
We agree with the petitioners contention that the issue of whether or not the P12,000,000 was merely
a loan by Ng in favor of the MI is a matter of defense by the respondent in the criminal case.
The transaction subject of the civil case is the loan procured by the MI in the amount of P9,820,000,
later increased to P11,200,000, from the China Banking Corporation, the payment of which was
secured by a real estate mortgage and amended real estate mortgage over its property in Sampaloc,
Manila. The MI sought to nullify the extrajudicial foreclosure of the said mortgage and the sale of its
property at public auction, on its allegation that it did not breach its contract with the bank. The
respondents agreement with Ng for the purchase of 120,000 shares of stocks in the MI, as well as the
alleged misappropriation of the amount of P12,000,000 by the respondent, is not the subject matter
of the civil case. Ng is not even a party thereto; neither was he privy to the said transaction between
the respondent and the MI, and the China Banking Corporation involving the said loan.
In sum, the outcome of the civil case is not, in any way, determinative of the guilt or innocence of the
respondent in the criminal case. The CA thus erred in granting the petition of the respondent and
nullifying the assailed orders of the trial court.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed Decision of the Court of
Appeals is SET ASIDE. The Orders of the Regional Trial Court of Mandaluyong City dated December 18,
1998 and February 1, 1999 are REINSTATED. No costs.

SECOND DIVISION
[G.R. No. 148595. July 12, 2004]
SPOUSES ANTONIO S. PAHANG and LOLITA T. PAHANG, petitioners, vs. HON. AUGUSTINE A. VESTIL,
Presiding Judge of Regional Trial Court- Branch 56, Mandaue City, DEPUTY SHERIFF, Regional Trial
Court-Branch 56 and METROPOLITAN BANK and TRUST COMPANY, respondents.
DECISION
CALLEJO, SR., J.:
Before us is a petition for review on certiorari filed by the Spouses Antonio and Lolita Pahang, for the
nullification of the Decision[1] and Resolution[2] of the Court of Appeals in CA-G.R. SP No. 59157.
The Antecedents
On January 5, 1996, the petitioners, Spouses Antonio and Lolita Pahang, received a short-term loan of
one million five hundred thousand pesos (P1,500,000.00) from the respondent Metropolitan Bank &
Trust Company payable on December 27, 1996. The loan was covered by Non-Negotiable Promissory
Note No. 190601[3] and was, likewise, secured by a real estate mortgage on a parcel of land covered
by Transfer Certificate of Title (TCT) No. 29607.[4] As the petitioners failed to pay the loan, the
interest and the penalties due thereon, the respondent foreclosed the real estate mortgage
extrajudicially. As a consequence, the mortgaged property was sold at public auction on January 8,
1998 to the respondent bank as the highest bidder. A certificate of sale was executed by Pasnonito D.
Antiporda as Ex-Officio Sheriff in favor of the respondent on January 14, 1998 and was registered with
the Register of Deeds of Mandaue City on January 27, 1998.

On December 29, 1998, the respondent wrote the petitioners that the one-year redemption period of
the property would expire on January 27, 1999.[5] Instead of redeeming the property, the petitioners
filed, on January 19, 1999, a complaint for annulment of extrajudicial sale against the respondent
bank and the Sheriff in the Regional Trial Court of Cebu (Mandaue City), Branch 56, docketed as Civil
Case No. MAN-3454.[6] Therein, the petitioners alleged that the respondent bloated their obligation
of P1,500,000.00 to P2,403,770.73 by including excessive past due interest, penalty charges,
attorneys fees and sheriffs expense. They claimed that such exorbitant charges were made to
frustrate their chance to pay the loan, and to ensure that the respondent bank would be the highest
bidder during the auction sale. They also asserted that the respondent failed to remit to the Sheriff
the purchase price of the property and was, likewise, guilty of fraud, collusion, breach of trust or
misconduct in the conduct of the auction sale of their property. Besides praying for injunctive relief,
the petitioners prayed for the following alternative reliefs:
3. After trial on the merits, and after determination of plaintiffs true obligation with defendant bank,
to declare the foreclosure on the subject property as null and void, and to allow the plaintiffs to
pay the same; as alternative prayer, to allow the plaintiffs to redeem the subject real property based
on the amount determined and established as true and exact obligation of plaintiffs to defendant
bank.[7]
After the expiration of the one-year redemption period, the respondent consolidated its ownership
over the foreclosed property. Consequently, TCT No. 44668 was issued by the Register of Deeds in its
name. On July 23, 1999, the respondent filed a Petition for Writ of Possession before the RTC of
Mandaue City (Branch 56), docketed as LRC Case No. 3.[8]
The petitioners, citing the ruling of this Court in Belisario v. The Intermediate Appellate Court,
[9] opposed the petition on the ground that the core issue in their complaint in Civil Case No. MAN3454 constituted a prejudicial question, which warranted a suspension of the proceedings
before the court. The petitioners averred that the filing of their complaint within the period to redeem
the foreclosed property was equivalent to an offer to redeem the same, and had the effect of
preserving such right. They also asserted that the respondent acted in bad faith in procuring the title
over the property despite the pendency of their complaint in Civil Case No. MAN-3454.
On March 28, 2000, the RTC of Mandaue City, Branch 56, rendered a decision in LRC Case No. 3
granting the petition and ordering the issuance of a writ of possession in favor of the respondent.[10]
Citing the case of Javelosa v. Court of Appeals,[11] and Gawaran v. Court of Appeals,[12] the RTC
ruled that since the petitioners failed to redeem the property within one year from the foreclosure,
the respondent was entitled to a writ of possession as a necessary consequence of the readjudication
of ownership and the corresponding issuance of the original certificate.[13] The petitioners filed a
motion for reconsideration of the decision, but the court issued an order denying the motion, stating
that it was merely its ministerial function to issue a writ of possession.[14]
The petitioners filed a petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP No.
59157 for the nullification of the March 28, 2000 Decision and the May 19, 2000 Order of the
RTC. Thepetitioners alleged that the RTC committed a grave abuse of its discretion amounting to
excess or lack of jurisdiction in granting the petition of the respondent bank for a writ of possession in
LRC Case No. 3 instead of suspending the proceedings therein based on the ruling of this Court
in Belisario vs. The Intermediate Appellate Court.[15]
The Ruling of the Court of Appeals
Finding that the RTC did not act with grave abuse of discretion in ordering the issuance of the writ of
possession, the CA rendered a decision on March 2, 2001, dismissing the petition.[16] Citing the
rulings of this Court in Vda. de Jacob v. Court of Appeals[17] and Navarra v. Court of Appeals,[18] the
CA explained that the pendency of a separate proceeding questioning the validity of the mortgage
and the extrajudicial foreclosure thereof cannot bar the issuance of a writ of possession in favor of the
purchaser at public auction. The appellate court ruled that after a title on the property has been
consolidated in the mortgagee, the issuance of a writ of possession becomes a ministerial act of the
trial court. Furthermore, the right of the respondent bank to possess the property was based on its
right of ownership as a purchaser of the properties in the foreclosure sale. The CA explained that the

ruling in the Belisario case was inapplicable because it involved a complaint to


enforce the repurchase of the foreclosed property within the period of redemption, whereas, the
complaint filed by the petitioners in Civil Case No. MAN-3454 was for the annulment of the mortgage
or extrajudicial sale which was not equivalent to an offer to redeem the property.[19]
The Present Petition
The motion for reconsideration of the petitioners of the decision, having been denied by the appellate
court, the petitioners filed this instant petition, assigning the following errors:
1. THE HONORABLE COURT OF APPEALS ERRED IN FINDING PETITIONERS RIGHT OF REDEMPTION
OVER THEIR FORECLOSED PROPERTY AS HAVING EXPIRED ON JANUARY 26, 1999, IN THE LIGHT OF
THEIR PENDING COMPLAINT TO ANNUL THE FORECLOSURE FILED BEFORE THE EXPIRATION OF THE
ONE-YEAR REDEMPTION PERIOD, ON THE GROUND OF FRAUD, AND CONSIDERING FURTHER THEIR
SPECIFIC PRAYER THEREOF FOR DETERMINATION OF THEIR TRUE OBLIGATION
WITH PRIVATE RESPONDENT, AND TO ALLOW THEM TO PAY THE SAME AND/OR TO REDEEM THEIR
FORECLOSED PROPERTY.[20]
2. PETITIONERS COMPLAINT FOR ANNULMENT OF THE FORECLOSURE OF THEIR PROPERTY WITH A
PRAYER FOR TEMPORARY RESTRAINING ORDER AND INJUNCTION TO STOP THE ISSUANCE OF A
DEFINITE DEED OF SALE AND CONSOLIDATION OF TITLE OF THEIR PROPERTY IN FAVOR OF PRIVATE
RESPONDENT, WHILE GIVING PREFERENCE AND ACTING WITH DISPATCH ON PRIVATE RESPONDENTS
PETITION FOR ISSUANCE OF WRIT OF POSSESSION ON THE SAME PROPERTY, BY GRANTING THE WRIT
OF POSSESSION THEREON THEREBY RENDERING MOOT AND ACADEMIC PETITIONERS PRAYERS IN
THEIR COMPLAINT FOR ANNULMENT OF FORECLOSURE.[21]
3. THE HONORABLE COURT OF APPEALS ERRED IN FINDING THE DECISION OF THIS HONORABLE
SUPREME COURT IN THE CASE OF BELISARIO VS. THE INTERMEDIATE APPELLATE COURT, G.R. NO. L73503, WHEREBY THE FILING OF THE COMPLAINT TO ENFORCE REPURCHASE WITHIN THE PERIOD FOR
REDEMPTION IS EQUIVALENT TO AN OFFER TO REDEEM AND HAS THE EFFECT OF PRESERVING THE
RIGHT OF REDEMPTION INAPPLICABLE TO THE CASE OF PETITIONERS.[22]
4. THE HONORABLE COURT OF APPEALS ERRED IN NOT APPRECIATING THE FACT THAT THE ISSUE OR
ISSUES JOINED IN THE COMPLAINT FOR ANNULMENT BEFORE RESPONDENT JUDGE DOCKETED AS
CIVIL CASE NO. MAN-4353 (sic) IS A PREJUDICIAL QUESTION TO THE ISSUE RAISED IN THE PETITION
FOR WRIT OF POSSESSION IN LRC CASE NO. 3.[23]
5. THE HONORABLE COURT OF APPEALS ERRED IN HAVING FAILED TO CONSIDER THE VALID CAUSES
OF ACTION OF PETITIONERS IN THEIR COMPLAINT FOR ANNULMENT IN CIVIL CASE NO. MAN-4354
(sic).[24]
The threshold issues are as follows: (a) whether or not the complaint of the petitioners in Civil Case
No. MAN-3454 for annulment of extrajudicial sale is a prejudicial question to the petition of the
respondent bank for the issuance of a writ of possession in LRC Case No. 3; and, (b) whether or not
the RTC committed a grave abuse of its discretion amounting to excess or lack of jurisdiction in
granting the petition of the respondent in LRC Case No. 3 and in issuing the writ of possession in its
favor.
The issues being interrelated, the Court shall resolve the same simultaneously.
The petitioners contend that their complaint in Civil Case No. MAN-3454 and the respondents petition
for a writ of possession in LRC Case No. 3 were raffled to Branch 56 of the RTC. Although their
complaint in Civil Case No. MAN-3454 was for the nullification of the extrajudicial sale at public
auction on the ground of fraud, they also prayed, as an alternative remedy, that they be allowed to
redeem the property based on the amount to be determined by the court after trial. Hence, they
assert, the filing of their complaint before the expiry of the redemption period to enforce their right of
redemption was equivalent to a formal offer to redeem the property and had the effect of preserving
their right of redemption. They argue that the RTC should have suspended the proceedings in LRC
Case No. 3 pending the final resolution of Civil Case No. MAN-3454 so as not to render moot and
academic the latter case, conformably with the ruling of the Court in Belisario vs. The Intermediate

Appellate Court,[25] after all, the two cases were pending before the same court. The petitioners,
thus, aver that the trial court committed grave abuse of discretion amounting to excess or lack of
jurisdiction in granting the petition of the respondent bank for a writ of possession in LRC Case No.
3. They, likewise, aver that the Court of Appeals erred when it affirmed the decision of the trial court
and declared, thus:
Further, as to the applicability of the case of Belisario vs. Intermediate Appellate Court (G.R. No. L73503, Aug. 30, 1988, 165 SCRA 101, 108), suffice it to say, that the cause of action therein was to
enforce the repurchase of the foreclosed property within the period of redemption, which the
Supreme Court held that it has the effect of preserving the right of redemption. Whereas, Civil Case
No. MAN-3454 filed by the petitioners is for the annulment of mortgage or extrajudicial sale, which is
not in effect an offer to redeem. Verily, the pendency of said civil case does not preserve the right of
redemption of the petitioners after the period of redemption.[26]
The Courts Ruling
The contentions of the petitioners have no merit.
A prejudicial question is one that arises in a case the resolution of which is a logical antecedent of the
issue involved therein, and the cognizance of which pertains to another tribunal. It generally comes
into play in a situation where a civil action and a criminal action are both pending and there exists in
the former an issue that must be preemptively resolved before the criminal action may proceed,
because howsoever the issue raised in the civil action is resolved would be determinative juris et de
jure of the guilt or innocence of the accused in the criminal case. The rationale behind the principle of
prejudicial question is to avoid two conflicting decisions.[27]
In the present case, the complaint of the petitioners for Annulment of Extrajudicial Sale is a civil
action and the respondents petition for the issuance of a writ of possession of Lot No. 3-A, Block 1,
Psd-07-021410, TCT No. 44668 is but an incident in the land registration case and, therefore, no
prejudicial question can arise from the existence of the two actions.[28] A similar issue was raised
in Manalo vs. Court of Appeals,[29] where we held that:
At any rate, it taxes our imagination why the questions raised in Case No. 98-0868 must be
considered determinative of Case No. 9011. The basic issue in the former is whether the respondent,
as the purchaser in the extrajudicial foreclosure proceedings, may be compelled to have the property
repurchased or resold to a mortgagors successor-in-interest (petitioner); while that in the latter is
merely whether the respondent, as the purchaser in the extrajudicial foreclosure proceedings, is
entitled to a writ of possession after the statutory period for redemption has expired. The two cases,
assuming both are pending, can proceed separately and take their own direction independent of each
other.[30]
The focal issue in Civil Case No. MAN-3454 was whether the extrajudicial foreclosure of the real estate
mortgage executed by the petitioners in favor of the respondent bank and the sale of their property
at public auction for P2,403,770.73 are null and void, whereas, the issue in LRC Case No. 3 was
whether the respondent bank was entitled to the possession of the property after the statutory period
for redemption had lapsed and title was issued .
Our ruling in Belisario has no application in this case because in the said case, no prejudicial question
was involved. We merely held therein that the filing of an action to enforce redemption within the
period of redemption is equivalent to a formal offer to redeem, and should the Court allow the
redemption, the redemptioner should then pay the amount already determined. In fine, the filing of
an action by the redemptioner to enforce his right to redeem does not suspend the running of the
statutory period to redeem the property, nor bar the purchaser at public auction from procuring a writ
of possession after the statutory period of redemption had lapsed, without prejudice to the final
outcome of such complaint to enforce the right of redemption.[31]
The remedy of the petitioners from the assailed decision of the RTC in LRC Case No. 3 was to appeal
by writ of error to the Court of Appeals.[32] However, instead of appealing by writ of error, the
petitioners filed their petition for certiorari. Certiorari is not proper where the aggrieved party has a
plain, speedy and adequate remedy at law. Moreover, the error of the trial court in granting the

respondent bank a writ of possession, if at all, was an error of judgment correctible only by an
ordinary appeal.
It bears stressing that the proceedings in a petition and/or motion for the issuance of a writ of
possession, after the lapse of the statutory period for redemption, is summary in nature.[33] The trial
court is mandated to issue a writ of possession upon a finding of the lapse of the statutory period for
redemption without the redemptioner having redeemed the property. It cannot be validly argued that
the trial court abused its discretion when it merely complied with its ministerial duty to issue the said
writ of possession.[34]
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED DUE COURSE. The assailed decision of the
Court of Appeals in CA-G.R. SP No. 59157 is AFFIRMED.
Cost against the petitioners.
SO ORDERED.
Puno, (Chairman), Quisumbing, Austria-Martinez, and Tinga, JJ., concur.

ARTICLE 40-41- COMMENCEMENT/ TERMINATION OF PERSONALITY


Article 2, Sec.12 (1987 Constitution)
Section 12. The State recognizes the sanctity of family life and shall protect and strengthen the family
as a basic autonomous social institution. It shall equally protect the life of the mother and the life of
the unborn from conception. The natural and primary right and duty of parents in the rearing of the
youth for civic efficiency and the development of moral character shall receive the support of the
Government.
Art. 5, PD 603
Article 5. Commencement of Civil Personality. - The civil personality of the child shall commence from
the time of his conception, for all purposes favorable to him, subject to the requirements of Article 41
of the Civil Code.

Republic of the Philippines


SUPREME COURT
Manila
EN BANC
G.R. No. L-16439

July 20, 1961

ANTONIO GELUZ, petitioner,


vs.
THE HON. COURT OF APPEALS and OSCAR LAZO, respondents.
Mariano H. de Joya for petitioner.
A.P. Salvador for respondents.
REYES, J.B.L., J.:
This petition for certiorari brings up for review question whether the husband of a woman, who
voluntarily procured her abortion, could recover damages from physician who caused the same.
The litigation was commenced in the Court of First Instance of Manila by respondent Oscar Lazo, the
of Nita Villanueva, against petitioner Antonio Geluz, a physician. Convinced of the merits of the
complaint upon the evidence adduced, the trial court rendered judgment favor of plaintiff Lazo and

against defendant Geluz, ordering the latter to pay P3,000.00 as damages, P700.00 attorney's fees
and the costs of the suit. On appeal, Court of Appeals, in a special division of five, sustained the
award by a majority vote of three justices as against two, who rendered a separate dissenting
opinion.
The facts are set forth in the majority opinion as follows:
Nita Villanueva came to know the defendant (Antonio Geluz) for the first time in 1948 through her
aunt Paula Yambot. In 1950 she became pregnant by her present husband before they were legally
married. Desiring to conceal her pregnancy from her parent, and acting on the advice of her aunt, she
had herself aborted by the defendant. After her marriage with the plaintiff, she again became
pregnant. As she was then employed in the Commission on Elections and her pregnancy proved to be
inconvenient, she had herself aborted again by the defendant in October 1953. Less than two years
later, she again became pregnant. On February 21, 1955, accompanied by her sister Purificacion and
the latter's daughter Lucida, she again repaired to the defendant's clinic on Carriedo and P. Gomez
streets in Manila, where the three met the defendant and his wife. Nita was again aborted, of a twomonth old foetus, in consideration of the sum of fifty pesos, Philippine currency. The plaintiff was at
this time in the province of Cagayan, campaigning for his election to the provincial board; he did not
know of, nor gave his consent, to the abortion.
It is the third and last abortion that constitutes plaintiff's basis in filing this action and award of
damages. Upon application of the defendant Geluz we granted certiorari.
The Court of Appeals and the trial court predicated the award of damages in the sum of P3,000.06
upon the provisions of the initial paragraph of Article 2206 of the Civil Code of the Philippines. This we
believe to be error, for the said article, in fixing a minimum award of P3,000.00 for the death of a
person, does not cover the case of an unborn foetus that is not endowed with personality. Under the
system of our Civil Code, "la criatura abortiva no alcanza la categoria de persona natural y en
consscuencia es un ser no nacido a la vida del Derecho" (Casso-Cervera, "Diccionario de Derecho
Privado", Vol. 1, p. 49), being incapable of having rights and obligations.
Since an action for pecuniary damages on account of personal injury or death pertains primarily to
the one injured, it is easy to see that if no action for such damages could be instituted on behalf of
the unborn child on account of the injuries it received, no such right of action could derivatively
accrue to its parents or heirs. In fact, even if a cause of action did accrue on behalf of the unborn
child, the same was extinguished by its pre-natal death, since no transmission to anyone can take
place from on that lacked juridical personality (or juridical capacity as distinguished from capacity to
act). It is no answer to invoke the provisional personality of a conceived child (conceptus pro nato
habetur) under Article 40 of the Civil Code, because that same article expressly limits such provisional
personality by imposing the condition that the child should be subsequently born alive: "provided it
be born later with the condition specified in the following article". In the present case, there is no
dispute that the child was dead when separated from its mother's womb.
The prevailing American jurisprudence is to the same effect; and it is generally held that recovery can
not had for the death of an unborn child (Stafford vs. Roadway Transit Co., 70 F. Supp. 555; Dietrich
vs. Northampton, 52 Am. Rep. 242; and numerous cases collated in the editorial note, 10 ALR, (2d)
639).
This is not to say that the parents are not entitled to collect any damages at all. But such damages
must be those inflicted directly upon them, as distinguished from the injury or violation of the rights
of the deceased, his right to life and physical integrity. Because the parents can not expect either
help, support or services from an unborn child, they would normally be limited to moral damages for
the illegal arrest of the normal development of thespes hominis that was the foetus, i.e., on account
of distress and anguish attendant to its loss, and the disappointment of their parental expectations
(Civ. Code Art. 2217), as well as to exemplary damages, if the circumstances should warrant them
(Art. 2230). But in the case before us, both the trial court and the Court of Appeals have not found
any basis for an award of moral damages, evidently because the appellee's indifference to the
previous abortions of his wife, also caused by the appellant herein, clearly indicates that he was
unconcerned with the frustration of his parental hopes and affections. The lower court expressly
found, and the majority opinion of the Court of Appeals did not contradict it, that the appellee was

aware of the second abortion; and the probabilities are that he was likewise aware of the first. Yet
despite the suspicious repetition of the event, he appeared to have taken no steps to investigate or
pinpoint the causes thereof, and secure the punishment of the responsible practitioner. Even after
learning of the third abortion, the appellee does not seem to have taken interest in the administrative
and criminal cases against the appellant. His only concern appears to have been directed at obtaining
from the doctor a large money payment, since he sued for P50,000.00 damages and P3,000.00
attorney's fees, an "indemnity" claim that, under the circumstances of record, was clearly
exaggerated.
The dissenting Justices of the Court of Appeals have aptly remarked that:
It seems to us that the normal reaction of a husband who righteously feels outraged by the abortion
which his wife has deliberately sought at the hands of a physician would be highminded rather than
mercenary; and that his primary concern would be to see to it that the medical profession was purged
of an unworthy member rather than turn his wife's indiscretion to personal profit, and with that idea
in mind to press either the administrative or the criminal cases he had filed, or both, instead of
abandoning them in favor of a civil action for damages of which not only he, but also his wife, would
be the beneficiaries.
It is unquestionable that the appellant's act in provoking the abortion of appellee's wife, without
medical necessity to warrant it, was a criminal and morally reprehensible act, that can not be too
severely condemned; and the consent of the woman or that of her husband does not excuse it. But
the immorality or illegality of the act does not justify an award of damage that, under the
circumstances on record, have no factual or legal basis.
The decision appealed from is reversed, and the complaint ordered dismissed. Without costs.
Let a copy of this decision be furnished to the Department of Justice and the Board of Medical
Examiners for their information and such investigation and action against the appellee Antonio Geluz
as the facts may warrant.
Bengzon, C.J., Padilla, Labrador, Barrera, Paredes, Dizon and Natividad, JJ., concur.
Concepcion, J., took no part.
De Leon, J., took no part.

THIRD DIVISION

CONTINENTAL STEEL
MANUFACTURING CORPORATION,

G.R. No. 182836

- versus HON. ACCREDITED VOLUNTARY


ARBITRATOR ALLAN S. MONTAO

DECISION

CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorari, under Rule 45 of the Rules of Court, assailing the
Decision[1] dated 27 February 2008 and the Resolution[2] dated 9 May 2008 of the Court of Appeals
in CA-G.R. SP No. 101697, affirming the Resolution[3] dated 20 November 2007 of respondent

Accredited Voluntary Arbitrator Atty. Allan S. Montao (Montao) granting bereavement leave and other
death benefits to Rolando P. Hortillano (Hortillano), grounded on the death of his unborn child.
The antecedent facts of the case are as follows:
Hortillano, an employee of petitioner Continental Steel Manufacturing Corporation (Continental Steel)
and a member of respondent Nagkakaisang Manggagawa ng Centro Steel Corporation-Solidarity of
Trade Unions in the Philippines for Empowerment and Reforms (Union) filed on 9 January 2006, a
claim for Paternity Leave, Bereavement Leave and Death and Accident Insurance for dependent,
pursuant to the Collective Bargaining Agreement (CBA) concluded between Continental and the
Union, which reads:
ARTICLE X: LEAVE OF ABSENCE
Section 2. BEREAVEMENT LEAVEThe Company agrees to grant a bereavement leave with pay to any
employee in case of death of the employees legitimate dependent (parents, spouse, children,
brothers and sisters) based on the following:
2.1 Within Metro Manila up to Marilao, Bulacan - 7 days
2.2 Provincial/Outside Metro Manila - 11 days
xxxx
ARTICLE XVIII: OTHER BENEFITS
xxxx
Section 4. DEATH AND ACCIDENT INSURANCEThe Company shall grant death and accidental
insurance to the employee or his family in the following manner:
xxxx
4.3 DEPENDENTSEleven Thousand Five Hundred Fifty Pesos (Php11,550.00) in case of death of the
employees legitimate dependents (parents, spouse, and children). In case the employee is single, this
benefit covers the legitimate parents, brothers and sisters only with proper legal document to be
presented (e.g. death certificate).[4]
The claim was based on the death of Hortillanos unborn child. Hortillanos wife, Marife V. Hortillano,
had a premature delivery on 5 January 2006 while she was in the 38th week of pregnancy.
[5]According to the Certificate of Fetal Death dated 7 January 2006, the female fetus died during
labor due to fetal Anoxia secondary to uteroplacental insufficiency.[6]
Continental Steel immediately granted Hortillanos claim for paternity leave but denied his claims for
bereavement leave and other death benefits, consisting of the death and accident insurance.[7]
Seeking the reversal of the denial by Continental Steel of Hortillanos claims for bereavement and
other death benefits, the Union resorted to the grievance machinery provided in the CBA. Despite the
series of conferences held, the parties still failed to settle their dispute,[8] prompting the Union to file
a Notice to Arbitrate before the National Conciliation and Mediation Board (NCMB) of the Department
of Labor and Employment (DOLE), National Capital Region (NCR).[9] In a Submission Agreement
dated 9 October 2006, the Union and Continental Steel submitted for voluntary arbitration the sole
issue of whether Hortillano was entitled to bereavement leave and other death benefits pursuant to
Article X, Section 2 and Article XVIII, Section 4.3 of the CBA.[10] The parties mutually chose Atty.
Montao, an Accredited Voluntary Arbitrator, to resolve said issue.[11]
When the preliminary conferences again proved futile in amicably settling the dispute, the parties
proceeded to submit their respective Position Papers, [12] Replies,[13] and Rejoinders[14] to Atty.
Montao.

The Union argued that Hortillano was entitled to bereavement leave and other death benefits
pursuant to the CBA. The Union maintained that Article X, Section 2 and Article XVIII, Section 4.3 of
the CBA did not specifically state that the dependent should have first been born alive or must have
acquired juridical personality so that his/her subsequent death could be covered by the CBA death
benefits. The Union cited cases wherein employees of MKK Steel Corporation (MKK Steel) and Mayer
Steel Pipe Corporation (Mayer Steel), sister companies of Continental Steel, in similar situations as
Hortillano were able to receive death benefits under similar provisions of their CBAs.
The Union mentioned in particular the case of Steve L. Dugan (Dugan), an employee of Mayer Steel,
whose wife also prematurely delivered a fetus, which had already died prior to the delivery. Dugan
was able to receive paternity leave, bereavement leave, and voluntary contribution under the CBA
between his union and Mayer Steel.[15] Dugans child was only 24 weeks in the womb and died before
labor, as opposed to Hortillanos child who was already 37-38 weeks in the womb and only died during
labor.
The Union called attention to the fact that MKK Steel and Mayer Steel are located in the same
compound as Continental Steel; and the representatives of MKK Steel and Mayer Steel who signed the
CBA with their respective employees unions were the same as the representatives of Continental
Steel who signed the existing CBA with the Union.
Finally, the Union invoked Article 1702 of the Civil Code, which provides that all doubts in labor
legislations and labor contracts shall be construed in favor of the safety of and decent living for the
laborer.
On the other hand, Continental Steel posited that the express provision of the CBA did not
contemplate the death of an unborn child, a fetus, without legal personality. It claimed that there are
two elements for the entitlement to the benefits, namely: (1) death and (2) status as
legitimate dependent, none of which existed in Hortillanos case. Continental Steel, relying on Articles
40, 41 and 42[16] of the Civil Code, contended that only one with civil personality could die. Hence,
the unborn child never died because it never acquired juridical personality. Proceeding from the same
line of thought, Continental Steel reasoned that a fetus that was dead from the moment of delivery
was not a person at all. Hence, the term dependent could not be applied to a fetus that never
acquired juridical personality. A fetus that was delivered dead could not be considered
a dependent, since it never needed any support, nor did it ever acquire the right to be supported.
Continental Steel maintained that the wording of the CBA was clear and unambiguous. Since neither
of the parties qualified the terms used in the CBA, the legally accepted definitions thereof were
deemed automatically accepted by both parties. The failure of the Union to have unborn
child included in the definition of dependent, as used in the CBA the death of whom would have
qualified the parent-employee for bereavement leave and other death benefits bound the Union to
the legally accepted definition of the latter term.
Continental Steel, lastly, averred that similar cases involving the employees of its sister companies,
MKK Steel and Mayer Steel, referred to by the Union, were irrelevant and incompetent evidence,
given the separate and distinct personalities of the companies. Neither could the Union sustain its
claim that the grant bereavement leave and other death benefits to the parent-employee for the loss
of an unborn child constituted company practice.
On 20 November 2007, Atty. Montao, the appointed Accredited Voluntary Arbitrator, issued a
Resolution[17] ruling that Hortillano was entitled to bereavement leave with pay and death benefits.
Atty. Montao identified the elements for entitlement to said benefits, thus:
This Office declares that for the entitlement of the benefit of bereavement leave with pay by the
covered employees as provided under Article X, Section 2 of the parties CBA, three (3) indispensable
elements must be present: (1) there is death; (2) such death must be of employees dependent; and
(3) such dependent must be legitimate.
On the otherhand, for the entitlement to benefit for death and accident insurance as provided under
Article XVIII, Section 4, paragraph (4.3) of the parties CBA, four (4) indispensable elements must be

present: (a) there is death; (b) such death must be of employees dependent; (c) such dependent
must be legitimate; and (d) proper legal document to be presented.[18]
Atty. Montao found that there was no dispute that the death of an employees legitimate dependent
occurred. The fetus had the right to be supported by the parents from the very moment he/she was
conceived. The fetus had to rely on another for support; he/she could not have existed or sustained
himself/herself without the power or aid of someone else, specifically, his/her mother. Therefore, the
fetus was already a dependent, although he/she died during the labor or delivery. There was also no
question that Hortillano and his wife were lawfully married, making their dependent, unborn child,
legitimate.
In the end, Atty. Montao decreed:
WHEREFORE, premises considered, a resolution is hereby rendered ORDERING [herein petitioner
Continental Steel] to pay Rolando P. Hortillano the amount of Four Thousand Nine Hundred Thirty-Nine
Pesos (P4,939.00), representing his bereavement leave pay and the amount of Eleven Thousand Five
Hundred Fifty Pesos (P11,550.00) representing death benefits, or a total amount of P16,489.00
The complaint against Manuel Sy, however, is ORDERED DISMISSED for lack of merit.
All other claims are DISMISSED for lack of merit.
Further, parties are hereby ORDERED to faithfully abide with the herein dispositions.
Aggrieved, Continental Steel filed with the Court of Appeals a Petition for Review on Certiorari,
[19] under Section 1, Rule 43 of the Rules of Court, docketed as CA-G.R. SP No. 101697.
Continental Steel claimed that Atty. Montao erred in granting Hortillanos claims for bereavement
leave with pay and other death benefits because no death of an employees dependent had
occurred. The death of a fetus, at whatever stage of pregnancy, was excluded from the coverage of
the CBA since what was contemplated by the CBA was the death of a legal person, and not that of a
fetus, which did not acquire any juridical personality. Continental Steel pointed out that its contention
was bolstered by the fact that the term death was qualified by the phrase legitimate dependent. It
asserted that the status of a child could only be determined upon said childs birth, otherwise, no such
appellation can be had. Hence, the conditions sine qua non for Hortillanos entitlement to
bereavement leave and other death benefits under the CBA were lacking.
The Court of Appeals, in its Decision dated 27 February 2008, affirmed Atty. Montaos Resolution
dated 20 November 2007. The appellate court interpreted death to mean as follows:
[Herein petitioner Continental Steels] exposition on the legal sense in which the term death is used in
the CBA fails to impress the Court, and the same is irrelevant for ascertaining the purpose, which the
grant of bereavement leave and death benefits thereunder, is intended to serve. While there is no
arguing with [Continental Steel] that the acquisition of civil personality of a child or fetus is
conditioned on being born alive upon delivery, it does not follow that such event of premature
delivery of a fetus could never be contemplated as a death as to be covered by the CBA provision,
undoubtedly an event causing loss and grief to the affected employee, with whom the dead fetus
stands in a legitimate relation. [Continental Steel] has proposed a narrow and technical significance
to the term death of a legitimate dependent as condition for granting bereavement leave and death
benefits under the CBA. Following [Continental Steels] theory, there can be no experience of death to
speak of. The Court, however, does not share this view. A dead fetus simply cannot be equated with
anything less than loss of human life, especially for the expectant parents. In this light, bereavement
leave and death benefits are meant to assuage the employee and the latters immediate family,
extend to them solace and support, rather than an act conferring legal status or personality upon the
unborn child. [Continental Steels] insistence that the certificate of fetal death is for statistical
purposes only sadly misses this crucial point.[20]
Accordingly, the fallo of the 27 February 2008 Decision of the Court of Appeals reads:

WHEREFORE, premises considered, the present petition is hereby DENIED for lack of merit. The
assailed Resolution dated November 20, 2007 of Accredited Voluntary Arbitrator Atty. Allan S. Montao
is hereby AFFIRMED and UPHELD.
With costs against [herein petitioner Continental Steel].[21]
In a Resolution[22] dated 9 May 2008, the Court of Appeals denied the Motion for
Reconsideration[23] of Continental Steel.
Hence, this Petition, in which Continental Steel persistently argues that the CBA is clear and
unambiguous, so that the literal and legal meaning of death should be applied. Only one with juridical
personality can die and a dead fetus never acquired a juridical personality.
We are not persuaded.
As Atty. Montao identified, the elements for bereavement leave under Article X, Section 2 of the CBA
are: (1) death; (2) the death must be of a dependent, i.e., parent, spouse, child, brother, or sister, of
an employee; and (3) legitimate relations of the dependent to the employee. The requisites for death
and accident insurance under Article XVIII, Section 4(3) of the CBA are: (1) death; (2) the death must
be of a dependent, who could be a parent, spouse, or child of a married employee; or a parent,
brother, or sister of a single employee; and (4) presentation of the proper legal document to prove
such death, e.g., death certificate.
It is worthy to note that despite the repeated assertion of Continental Steel that the provisions of the
CBA are clear and unambiguous, its fundamental argument for denying Hortillanos claim for
bereavement leave and other death benefits rests on the purportedly proper interpretation of the
terms death and dependent as used in the CBA. If the provisions of the CBA are indeed clear and
unambiguous, then there is no need to resort to the interpretation or construction of the
same. Moreover, Continental Steel itself admitted that neither management nor the Union sought to
define the pertinent terms for bereavement leave and other death benefits during the negotiation of
the CBA.
The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code for the legal definition
of death is misplaced. Article 40 provides that a conceived child acquires personality only when it is
born, and Article 41 defines when a child is considered born. Article 42 plainly states that civil
personality is extinguished by death.
First, the issue of civil personality is not relevant herein. Articles 40, 41 and 42 of the Civil Code on
natural persons, must be applied in relation to Article 37 of the same Code, the very first of the
general provisions on civil personality, which reads:
Art. 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every
natural person and is lost only through death. Capacity to act, which is the power to do acts with legal
effect, is acquired and may be lost.
We need not establish civil personality of the unborn child herein since his/her juridical capacity and
capacity to act as a person are not in issue. It is not a question before us whether the unborn child
acquired any rights or incurred any obligations prior to his/her death that were passed on to or
assumed by the childs parents. The rights to bereavement leave and other death benefits in the
instant case pertain directly to the parents of the unborn child upon the latters death.
Second, Sections 40, 41 and 42 of the Civil Code do not provide at all a definition of death. Moreover,
while the Civil Code expressly provides that civil personality may be extinguished by death, it does
not explicitly state that only those who have acquired juridical personality could die.
And third, death has been defined as the cessation of life.[24] Life is not synonymous with civil
personality. One need not acquire civil personality first before he/she could die. Even a child inside
the womb already has life. No less than the Constitution recognizes the life of the unborn from
conception,[25] that the State must protect equally with the life of the mother. If the unborn already
has life, then the cessation thereof even prior to the child being delivered, qualifies as death.

Likewise, the unborn child can be considered a dependent under the CBA. As Continental Steel itself
defines, a dependent is one who relies on another for support; one not able to exist or sustain oneself
without the power or aid of someone else. Under said general definition,[26] even an unborn child is
a dependent of its parents. Hortillanos child could not have reached 38-39 weeks of its gestational life
without depending upon its mother, Hortillanos wife, for sustenance. Additionally, it is explicit in the
CBA provisions in question that the dependent may be the parent, spouse, or child of a married
employee; or the parent, brother, or sister of a single employee. The CBA did not provide a
qualification for the child dependent, such that the child must have been born or must have acquired
civil personality, as Continental Steel avers. Without such qualification, then child shall be understood
in its more general sense, which includes the unborn fetus in the mothers womb.
The term legitimate merely addresses the dependent childs status in relation to his/her
parents. In Angeles v. Maglaya,[27] we have expounded on who is a legitimate child, viz:
A legitimate child is a product of, and, therefore, implies a valid and lawful marriage. Remove the
element of lawful union and there is strictly no legitimate filiation between parents and child. Article
164 of the Family Code cannot be more emphatic on the matter: Children conceived or born during
the marriage of the parents are legitimate. (Emphasis ours.)
Conversely, in Briones v. Miguel,[28] we identified an illegitimate child to be as follows:
The fine distinctions among the various types of illegitimate children have been eliminated in the
Family Code. Now, there are only two classes of children -- legitimate (and those who, like the legally
adopted, have the rights of legitimate children) and illegitimate. All children conceived and born
outside a valid marriage are illegitimate, unless the law itself gives them legitimate status. (Emphasis
ours.)
It is apparent that according to the Family Code and the afore-cited jurisprudence, the legitimacy or
illegitimacy of a child attaches upon his/her conception. In the present case, it was not disputed that
Hortillano and his wife were validly married and that their child was conceived during said marriage,
hence, making said child legitimate upon her conception.
Also incontestable is the fact that Hortillano was able to comply with the fourth element entitling him
to death and accident insurance under the CBA, i.e., presentation of the death certificate of his
unborn child.
Given the existence of all the requisites for bereavement leave and other death benefits under the
CBA, Hortillanos claims for the same should have been granted by Continental Steel.
We emphasize that bereavement leave and other death benefits are granted to an employee to give
aid to, and if possible, lessen the grief of, the said employee and his family who suffered the loss of a
loved one. It cannot be said that the parents grief and sense of loss arising from the death of their
unborn child, who, in this case, had a gestational life of 38-39 weeks but died during delivery, is any
less than that of parents whose child was born alive but died subsequently.
Being for the benefit of the employee, CBA provisions on bereavement leave and other death benefits
should be interpreted liberally to give life to the intentions thereof. Time and again, the Labor Code is
specific in enunciating that in case of doubt in the interpretation of any law or provision affecting
labor, such should be interpreted in favor of labor.[29] In the same way, the CBA and CBA provisions
should be interpreted in favor of labor. In Marcopper Mining v. National Labor Relations Commission,
[30] we pronounced:
Finally, petitioner misinterprets the declaration of the Labor Arbiter in the assailed decision that
"when the pendulum of judgment swings to and fro and the forces are equal on both sides, the same
must be stilled in favor of labor." While petitioner acknowledges that all doubts in the interpretation of
the Labor Code shall be resolved in favor of labor, it insists that what is involved-here is the amended
CBA which is essentially a contract between private persons. What petitioner has lost sight of is the
avowed policy of the State, enshrined in our Constitution, to accord utmost protection and justice to
labor, a policy, we are, likewise, sworn to uphold.

In Philippine Telegraph & Telephone Corporation v. NLRC [183 SCRA 451 (1990)], we categorically
stated that:
When conflicting interests of labor and capital are to be weighed on the scales of social justice, the
heavier influence of the latter should be counter-balanced by sympathy and compassion the law must
accord the underprivileged worker.
Likewise, in Terminal Facilities and Services Corporation v. NLRC [199 SCRA 265 (1991)], we declared:
Any doubt concerning the rights of labor should be resolved in its favor pursuant to the social justice
policy.
IN VIEW WHEREOF, the Petition is DENIED. The Decision dated 27 February 2008 and Resolution
dated 9 May 2008 of the Court of Appeals in CA-G.R. SP No. 101697, affirming the Resolution dated
20 November 2007 of Accredited Voluntary Arbitrator Atty. Allan S. Montao, which granted to Rolando
P. Hortillano bereavement leave pay and other death benefits in the amounts of Four Thousand Nine
Hundred Thirty-Nine Pesos (P4,939.00) and Eleven Thousand Five Hundred Fifty Pesos (P11,550.00),
respectively, grounded on the death of his unborn child, are AFFIRMED. Costs against Continental
Steel Manufacturing Corporation.
SO ORDERED.

ARTICLE 42- DEATH/ EXTINGUISHMENT OF PERSONALITY


G.R. No. 85140 May 17, 1990
TOMAS EUGENIO, SR., petitioner,
vs.
HON. ALEJANDRO M. VELEZ, Presiding Judge, Regional Trial Court, Branch 20, Cagayan de Oro City,
DEPUTY SHERIFF JOHNSON TAN, JR., Deputy Sheriff of Branch 20, Regional Trial Court, Cagayan de Oro
City, and the Private Respondents, the petitioners in Sp. Proc. No. 88-55, for "Habeas Corpus",
namely: CRISANTA VARGAS-SANCHEZ, SANTOS and NARCISA VARGAS-BENTULAN, respondents.
G.R. No. 86470 May 17, 1990.
TOMAS EUGENIO, petitioner-appellant,
vs.
HON. ALEJANDRO M. VELEZ, Presiding Judge, Regional Trial Court, Branch 20, Cagayan de Oro City,
CRISANTA VARGAS-SANCHEZ, FELIX VARGAS, ERNESTO VARGAS, NATIVIDAD VARGAS-CAGAPE, NENITA
VARGAS-CADENAS, LUDIVINA VARGAS-DE LOS SANTOS and NARCISA VARGASBENTULAN,respondents-appellees.
Maximo G. Rodriguez for petitioner.
Erasmo B. Damasing and Oliver Asis Improso for respondents.

PADILLA, J.:
On 5 October 1988, petitioner came to this Court with a petition for certiorari and prohibition with
application for restraining order and/or injunction (docketed as G.R. No. 85140) seeking to enjoin
respondent Judge from proceeding with the Habeas Corpus case (Sp. Proc. No. 88- 55, RTC, Branch
20, Cagayan de Oro City), * the respondent Sheriff from enforcing and implementing the writ and
orders of the respondent Judge dated 28, 29, and 30 September 1988, and to declare said writ and
orders as null and void. In a resolution issued on 11 October 1988, this Court required comment from
the respondents on the petition but denied the application for a temporary restraining order.
The records disclose the following:

Unaware of the death on 28 August 1988 of (Vitaliana Vargas Vitaliana for brevity), her full blood
brothers and sisters, herein private respondents (Vargases', for brevity) filed on 27 September 1988,
a petition for habeas corpus before the RTC of Misamis Oriental (Branch 20, Cagayan de Oro City)
alleging that Vitaliana was forcibly taken from her residence sometime in 1987 and confined by herein
petitioner in his palacial residence in Jasaan, Misamis Oriental. Despite her desire to escape, Vitaliana
was allegedly deprived of her liberty without any legal authority. At the time the petition was filed, it
was alleged that Vitaliana was 25 years of age, single, and living with petitioner Tomas Eugenio.
The respondent court in an order dated 28 September 1988 issued the writ of habeas corpus, but the
writ was returned unsatisfied. Petitioner refused to surrender the body of Vitaliana (who had died on
28 August 1988) to the respondent sheriff, reasoning that a corpse cannot be the subject of habeas
corpus proceedings; besides, according to petitioner, he had already obtained a burial permit from
the Undersecretary of the Department of Health, authorizing the burial at the palace quadrangle of
the Philippine Benevolent Christian Missionary, Inc. (PBCM), a registered religious sect, of which he
(petitioner) is the Supreme President and Founder.
Petitioner also alleged that Vitaliana died of heart failure due to toxemia of pregnancy in his residence
on 28 August 1988. As her common law husband, petitioner claimed legal custody of her body. These
reasons were incorporated in an explanation filed before the respondent court. Two (2) orders dated
29 and 30 September 1988 were then issued by respondent court, directing delivery of the
deceased's body to a funeral parlor in Cagayan de Oro City and its autopsy.
Petitioner (as respondent in the habeas corpus proceedings) filed an urgent motion to dismiss the
petition therein, claiming lack of jurisdiction of the court over the nature of the action under sec. 1(b)
of Rule 16 in relation to sec. 2, Rule 72 of the Rules of Court. 1 A special proceeding for habeas
corpus, petitioner argued, is not applicable to a dead person but extends only to all cases of illegal
confinement or detention of a live person.
Before resolving the motion to dismiss, private respondents (as petitioners below) were granted leave
to amend their petition. 2 Claiming to have knowledge of the death of Vitaliana only on 28 September
1988 (or after the filing of thehabeas corpus petition), private respondents (Vargases') alleged that
petitioner Tomas Eugenia who is not in any way related to Vitaliana was wrongfully interfering with
their (Vargases') duty to bury her. Invoking Arts. 305 and 308 of the Civil Code, 3 the Vargases
contended that, as the next of kin in the Philippines, they are the legal custodians of the dead body of
their sister Vitaliana. An exchange of pleadings followed. The motion to dismiss was finally submitted
for resolution on 21 October 1988.
In the absence of a restraining order from this Court, proceedings continued before the respondent
court; the body was placed in a coffin, transferred to the Greenhills Memorial Homes in Cagayan de
Oro City, viewed by the presiding Judge of respondent court, and examined by a duly authorized
government pathologist. 4
Denying the motion to dismiss filed by petitioner, the court a quo held in an order, 5 dated 17
November 1988, that:
It should be noted from the original petition, to the first amended petition, up to the second amended
petition that the ultimate facts show that if the person of Vitaliana Vargas turns out to be dead then
this Court is being prayed to declare the petitioners as the persons entitled to the custody, interment
and/or burial of the body of said deceased. The Court, considering the circumstance that Vitaliana
Vargas was already dead on August 28, 1988 but only revealed to the Court on September 29, 1988
by respondent's counsel, did not lose jurisdiction over the nature and subject matter of this case
because it may entertain this case thru the allegations in the body of the petition on the
determination as to who is entitled to the custody of the dead body of the late Vitaliana Vargas as
well as the burial or interment thereof, for the reason that under the provisions of Sec. 19 of Batas
Pambansa Blg. 129, which reads as follows:
Sec. 19. Jurisdiction in civil cases. Regional Trial Courts shall exercise exclusive original jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;

xxx xxx xxx


(5) In all actions involving the contract of marriage and marital relations;
(6) In all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising
judicial or quasi-judicial functions:
xxx xxx xxx
it so provides that the Regional Trial Court has exclusive original jurisdiction to try this case. The
authority to try the issue of custody and burial of a dead person is within the lawful jurisdiction of this
Court because of Batas Pambansa Blg. 129 and because of the allegations of the pleadings in this
case, which are enumerated in Sec. 19, pars. 1, 5 and 6 of Batas Pambansa Blg. 129.
Thereafter, the court a quo proceeded as in or civil cases and, in due course, rendered a decision on
17 January 1989, 6 resolving the main issue of whether or not said court acquired jurisdiction over the
case by treating it as an action for custody of a dead body, without the petitioners having to file a
separate civil action for such relief, and without the Court first dismissing the original petition
for habeas corpus.
Citing Sections 19 and 20 of Batas Pambansa Blg. 129 (the Judiciary Reorganization Act of
1981), 7 Sections 5 and 6 of Rule 135 of the Rules of Court 8 Articles 305 and 308 in relation to Article
294 of the Civil Code and Section 1104 of the Revised Administrative Code, 9 the decision stated:
. . . . By a mere reading of the petition the court observed that the allegations in the original petition
as well as in the two amended petitions show that Vitaliana Vargas has been restrained of her liberty
and if she were dead then relief was prayed for the custody and burial of said dead person. The
amendments to the petition were but elaborations but the ultimate facts remained the same, hence,
this court strongly finds that this court has ample jurisdiction to entertain and sit on this case as an
action for custody and burial of the dead body because the body of the petition controls and is
binding and since this case was raffled to this court to the exclusion of all other courts, it is the
primary duty of this court to decide and dispose of this case. . . . . 10
Satisfied with its jurisdiction, the respondent court then proceeded to the matter of rightful custody
over the dead body, (for purposes of burial thereof). The order of preference to give support under
Art. 294 was used as the basis of the award. Since there was no surviving spouse, ascendants or
descendants, the brothers and sisters were preferred over petitioner who was merely a common law
spouse, the latter being himself legally married to another woman. 11
On 23 January 1989, a new petition for review with application for a temporary restraining order
and/or preliminary injunction was filed with this Court (G.R. No. 86470). Raised therein were pure
questions of law, basically Identical to those raised in the earlier petition (G.R. No. 85140); hence, the
consolidation of both cases.12 On 7 February 1989, petitioner filed an urgent motion for the issuance
of an injunction to maintain status quo pending appeal, which this Court denied in a resolution dated
23 February 1989 stating that "Tomas Eugenio has so far failed to sufficiently establish a clear legal
right to the custody of the dead body of Vitaliana Vargas, which now needs a decent burial." The
petitions were then submitted for decision without further pleadings.
Between the two (2) consolidated petitions, the following issues are raised:
1. propriety of a habeas corpus proceeding under Rule 102 of the Rules of Court to recover custody of
the dead body of a 25 year old female, single, whose nearest surviving claimants are full blood
brothers and sisters and a common law husband.
2. jurisdiction of the RTC over such proceedings and/or its authority to treat the action as one for
custody/possession/authority to bury the deceased/recovery of the dead.
3. interpretation of par. 1, Art. 294 of the Civil Code (Art. 199 of the new Family Code) which states:
Art. 294. The claim for support, when proper and two or more persons are obliged to give it, shall be
made in the following order:

(1) From the spouse;


xxx xxx xxx
Section 19, Batas Pambansa Blg. 129 provides for the exclusive original jurisdiction of the Regional
Trial Courts over civil cases. Under Sec. 2, Rule 102 of the Rules of Court, the writ of habeas
corpus may be granted by a Court of First Instance (now Regional Trial Court). It is an elementary rule
of procedure that what controls is not the caption of the complaint or petition; but the allegations
therein determine the nature of the action, and even without the prayer for a specific remedy, proper
relief may nevertheless be granted by the court if the facts alleged in the complaint and the evidence
introduced so warrant. 13
When the petition for habeas corpus was filed before the court a quo, it was not certain whether
Vitaliana was dead or alive. While habeas corpus is a writ of right, it will not issue as a matter of
course or as a mere perfimetory operation on the filing of the petition. Judicial discretion is exercised
in its issuance, and such facts must be made to appear to the judge to whom the petition is presented
as, in his judgment, prima facie entitle the petitioner to the writ. 14 While the court may refuse to
grant the writ if the petition is insufficient in form and substance, the writ should issue if the petition
complies with the legal requirements and its averments make a prima facie case for relief. However, a
judge who is asked to issue a writ of habeas corpus need not be very critical in looking into the
petition for very clear grounds for the exercise of this jurisdiction. The latter's power to make full
inquiry into the cause of commitment or detention will enable him to correct any errors or defects in
the petition. 15
In Macazo and Nunez vs. Nunez, 16 the Court frowned upon the dismissal of a habeas corpus petition
filed by a brother to obtain custody of a minor sister, stating:
All these circumstances notwithstanding, we believe that the case should not have been dismissed.
The court below should not have overlooked that by dismissing the petition, it was virtually
sanctioning the continuance of an adulterous and scandalous relation between the minor and her
married employer, respondent Benildo Nunez against all principles of law and morality. It is no excuse
that the minor has expressed preference for remaining with said respondent, because the minor may
not chose to continue an illicit relation that morals and law repudiate.
xxx xxx xxx
The minor's welfare being the paramount consideration, the court below should not allow the
technicality, that Teofilo Macazo was not originally made a party, to stand in the way of its giving the
child full protection. Even in a habeas corpus proceeding the court had power to award temporary
custody to the petitioner herein, or some other suitable person, after summoning and hearing all
parties concerned. What matters is that the immoral situation disclosed by the records be not allowed
to continue. 17
After the fact of Vitaliana's death was made known to the petitioners in the habeas
corpus proceedings,amendment of the petition for habeas corpus, not dismissal, was proper to avoid
multiplicity of suits. Amendments to pleadings are generally favored and should be liberally allowed
in furtherance of justice in order that every case may so far as possible be determined on its real
facts and in order to expedite the trial of cases or prevent circuity of action and unnecessary expense,
unless there are circumstances such as inexcusable delay or the taking of the adverse party by
surprise or the like, which justify a refusal of permission to amend. 18 As correctly alleged by
respondents, the writ of habeas corpus as a remedy became moot and academic due to the death of
the person allegedly restrained of liberty, but the issue of custody remained, which the court a quo
had to resolve.
Petitioner claims he is the spouse contemplated under Art. 294 of the Civil Code, the term spouse
used therein not being preceded by any qualification; hence, in the absence of such qualification, he
is the rightful custodian of Vitaliana's body. Vitaliana's brothers and sisters contend otherwise. Indeed,
Philippine Law does not recognize common law marriages. A man and woman not legally married who
cohabit for many years as husband and wife, who represent themselves to the public as husband and

wife, and who are reputed to be husband and wife in the community where they live may be
considered legally mauled in common law jurisdictions but not in the Philippines. 19
While it is true that our laws do not just brush aside the fact that such relationships are present in our
society, and that they produce a community of properties and interests which is governed by
law, 20 authority exists in case law to the effect that such form of co-ownership requires that the man
and woman living together must not in any way be incapacitated to contract marriage. 21 In any
case, herein petitioner has a subsisting marriage with another woman, a legal impediment which
disqualified him from even legally marrying Vitaliana. In Santero vs. CFI of Cavite, 22 ,the Court, thru
Mr. Justice Paras, interpreting Art. 188 of the Civil Code (Support of Surviving Spouse and Children
During Liquidation of Inventoried Property) stated: "Be it noted however that with respect to 'spouse',
the same must be the legitimate 'spouse' (not common-law spouses)."
There is a view that under Article 332 of the Revised Penal Code, the term "spouse" embraces
common law relation for purposes of exemption from criminal liability in cases of theft, swindling and
malicious mischief committed or caused mutually by spouses. The Penal Code article, it is said, makes
no distinction between a couple whose cohabitation is sanctioned by a sacrament or legal tie and
another who are husband and wife de facto. 23 But this view cannot even apply to the facts of the
case at bar. We hold that the provisions of the Civil Code, unless expressly providing to the contrary
as in Article 144, when referring to a "spouse" contemplate a lawfully wedded spouse. Petitioner vis-avis Vitaliana was not a lawfully-wedded spouse to her; in fact, he was not legally capacitated to marry
her in her lifetime.
Custody of the dead body of Vitaliana was correctly awarded to her surviving brothers and sisters (the
Vargases). Section 1103 of the Revised Administrative Code provides:
Sec. 1103. Persons charged with duty of burial. The immediate duty of burying the body of a
deceased person, regardless of the ultimate liability for the expense thereof, shall devolve upon the
persons hereinbelow specified:
xxx xxx xxx
(b) If the deceased was an unmarried man or woman, or a child, and left any kin, the duty of burial
shall devolve upon the nearest of kin of the deceased, if they be adults and within the Philippines and
in possession of sufficient means to defray the necessary expenses.
WHEREFORE, the decision appealed from is AFFIRMED. Both petitions are hereby DISMISSED. No
Costs.
SO ORDERED.
Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Bidin, Sarmiento, Cortes,
Medialdea and Regalado, JJ., concur.
Gancayco and Grino-Aquino, JJ., are on leave.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-15499

February 28, 1962

ANGELA M. BUTTE, plaintiff-appellant,


vs.
MANUEL UY and SONS, INC., defendant-appellee.
Delgado, Flores and Macapagal for plaintiff-appellant.
Pelaez and Jalandoni for defendant-appellee.

REYES, J.B.L., J.:


Appeal from a decision of the Court of First instance of Manila dismissing the action for legal
redemption filed by plaintiff-appellant.
It appears that Jose V. Ramirez, during his lifetime, was a co-owner of a house and lot located at Sta.
Cruz, Manila, as shown by Transfer Certificate of Title No. 52789, issued in the name of the following
co-owners: Marie Garnier Vda. de Ramirez, 1/6; Jose V. Ramirez, 1/6; Jose E. Ramirez, 1/6; Rita de
Ramirez, 1/6; and Jose Ma. Ramirez, 1/6.
On October 20, 1951, Jose V. Ramirez died. Subsequently, Special Proceeding No. 15026 was
instituted to settle his estate, that included the one-sixth (1/6) undivided share in the aforementioned
property. And although his last will and testament, wherein he bequeathed his estate to his children
and grandchildren and one-third (1/3) of the free portion to Mrs. Angela M. Butte, hereinafter referred
to as plaintiff-appellant, has been admitted to probate, the estate proceedings are still pending up to
the present on account of the claims of creditors which exceed the assets of the deceased. The Bank
of the Philippine Islands was appointed judicial administrator.
Meanwhile, on December 9, 1958, Mrs. Marie Garnier Vda. de Ramirez, one of the co-owners of the
late Jose V. Ramirez in the Sta. Cruz property, sold her undivided 1/6 share to Manuel Uy & Sons, Inc.
defendant-appellant herein, for the sum of P500,000.00. After the execution by her attorney-in-fact,
Mrs. Elsa R. Chambers, of an affidavit to the effect that formal notices of the sale had been sent to all
possible redemptioners, the deed of sale was duly registered and Transfer Certificate of Title No.
52789 was cancelled in lieu of which a new one was issued in the name of the vendee and the otherco-owners.
On the same day (December 9, 1958), Manuel Uy & Sons, Inc. sent a letter to the Bank of the
Philippine Islands as judicial administrator of the estate of the late Jose V. Ramirez informing it of the
above-mentioned sale. This letter, together with that of the bank, was forwarded by the latter to Mrs.
Butte c/o her counsel Delgado, Flores & Macapagal, Escolta, Manila, and having received the same on
December 10, 1958, said law office delivered them to plaintiff-appellant's son, Mr. Miguel Papa, who
in turn personally handed the letters to his mother, Mrs. Butte, on December 11 and 12, 1958. Aside
from this letter of defendant-appellant, the vendor, thru her attorney-in-fact Mrs. Chambers, wrote
said bank on December 11, 1958 confirming vendee's letter regarding the sale of her 1/6 share in the
Sta. Cruz property for the sum of P500,000.00. Said letter was received by the bank on December 15,
1958 and having endorsed it to Mrs. Butte's counsel, the latter received the same on December 16,
1958. Appellant received the letter on December 19, 1958.
On January 15, 1959, Mrs. Angela M. Butte, thru Atty. Resplandor Sobretodo, sent a letter and a
Philippine National Bank cashier's check in the amount of P500,000.00 to Manuel Uy & Sons, Inc.
offering to redeem the 1/6 share sold by Mrs. Marie Garnier Vda. de Ramirez. This tender having been
refused, plaintiff on the same day consigned the amount in court and filed the corresponding action
for legal redemption. Without prejudice to the determination by the court of the reasonable and fair
market value of the property sold which she alleged to be grossly excessive, plaintiff prayed for
conveyance of the property, and for actual, moral and exemplary damages.
After the filing by defendant of its answer containing a counterclaim, and plaintiff's reply thereto, trial
was held, after which the court rendered decision on May 13, 1959, dismissing plaintiff's complaint on
the grounds that she has no right to redeem the property and that, if ever she had any, she exercised
the same beyond the statutory 30-day period for legal redemptions provided by the Civil Code. The
counterclaim of defendant for damages was likewise dismissed for not being sufficiently established.
Both parties appealed directly to this Court.
Based on the foregoing facts, the main issues posed in this appeal are: (1) whether or not plaintiffappellant, having been bequeathed 1/3 of the free portion of the estate of Jose V. Ramirez, can
exercise the right of legal redemption over the 1/6 share sold by Mrs. Marie Garnier Vda. de Ramirez
despite the presence of the judicial administrator and pending the final distribution of her share in the
testate proceedings; and (2) whether or not she exercised the right of legal redemption within the
period prescribed by law.

The applicable law involved in the present case is contained in Articles 1620, p. 1, and 1623 of the
Civil Code of the Philippines, which read as follows:
ART. 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the
other-co-owners or of any of them, are sold to a third person. If the price of the alienation is grossly
excessive, the redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of redemption, they may only do so in
proportion to the share they may respectively have in the thing owned in common. (1522a)
ART. 1623. The right of legal predemption or redemption shall not be exercised except within thirty
days from the notice in writing by the respective vendor, or by the vendor, as the case may be. The
deed of sale shall not be accorded in the Registry of Property, unless accompanied by an affidavit of
the vendor that he has given written notice thereof at all possible redemptioners.
The right of redemption of co-owners excludes that of adjoining owners. (1524a)
That the appellant Angela M. Butte is entitled to exercise the right of legal redemption is clear. As
testamentary heir of the estate of J.V. Ramirez, she and her co-heirs acquired an interest in the
undivided one-sixth (1/6) share owned by her predecessor (causante) in the Santa Cruz property,
from the moment of the death of the aforesaid co-owner, J.V. Ramirez. By law, the rights to the
succession of a deceased persons are transmitted to his heirs from the moment of his death, and the
right of succession includes all property rights and obligations that survive the decedent.
ART. 776. The inheritance includes all the property, rights and obligations of a person which are not
extinguished by his death. (659)
ART. 777. The rights to the succession are transmitted from the moment of the death of the decedent.
(657a)
ART. 947. The legatee or devisee acquires a right to the pure and simple legacies or devisees from the
death of the testator, and transmits it to his heirs. (881a)
The principle of transmission as of the time of the predecessor's death is basic in our Civil Code, and
is supported by other related articles. Thus, the capacity of the heir is determined as of the time the
decedent died (Art. 1034); the legitime is to be computed as of the same moment(Art. 908), and so is
the in officiousness of the donationinter vivos (Art. 771). Similarly, the legacies of credit and
remission are valid only in the amount due and outstanding at the death of the testator (Art. 935),and
the fruits accruing after that instant are deemed to pertain to the legatee (Art. 948).
As a consequence of this fundamental rule of succession, the heirs of Jose V. Ramirez acquired his
undivided share in the Sta. Cruz property from the moment of his death, and from that instant, they
became co-owners in the aforesaid property, together with the original surviving co-owners of their
decedent (causante). A co-owner of an undivided share is necessarily a co-owner of the whole.
Wherefore, any one of the Ramirez heirs, as such co-owner, became entitled to exercise the right of
legal redemption (retracto de comuneros) as soon as another co-owner (Maria Garnier Vda. de
Ramirez) had sold her undivided share to a stranger, Manuel Uy & Sons, Inc. This right of redemption
vested exclusively in consideration of the redemptioner's share which the law nowhere takes into
account.
The situation is in no wise altered by the existence of a judicial administrator of the estate of Jose V.
Ramirez while under the Rules of Court the administrator has the right to the possession of the real
and personal estate of the deceased, so far as needed for the payment of the decedent's debts and
the expenses of administration (sec. 3, Rule 85), and the administrator may bring or defend actions
for the recovery or protection of the property or rights of the deceased (sec. 2, Rule 88), such rights
of possession and administration do not include the right of legal redemption of the undivided share
sold to Uy & Company by Mrs. Garnier Ramirez. The reason is obvious: this right of legal redemption
only came into existence when the sale to Uy & Sons, Inc. was perfected, eight (8) years after the
death of Jose V. Ramirez, and formed no part of his estate. The redemption right vested in the heirs
originally, in their individual capacity, they did not derivatively acquire it from their decedent, for

when Jose V. Ramirez died, none of the other co-owners of the Sta. Cruz property had as yet sold his
undivided share to a stranger. Hence, there was nothing to redeem and no right of redemption; and if
the late Ramirez had no such right at his death, he could not transmit it to his own heirs. Much less
could Ramirez acquire such right of redemption eight years after his death, when the sale to Uy &
Sons, Inc. was made; because death extinguishes civil personality, and, therefore, all further juridical
capacity to acquire or transmit rights and obligations of any kind (Civil Code of the Phil., Art. 42).
It is argued that the actual share of appellant Mrs. Butte in the estate of Jose V. Ramirez has not been
specifically determined as yet, that it is still contingent; and that the liquidation of estate of Jose V.
Ramirez may require the alienation of the decedent's undivided portion in the Sta. Cruz property, in
which event Mrs. Butte would have no interest in said undivided portion. Even if it were true, the fact
would remain that so long as that undivided share remains in the estate, the heirs of Jose V. Ramirez
own it, as the deceased did own it before his demise, so that his heirs are now as much co-owners of
the Sta. Cruz property as Jose V. Ramirez was himself a co-owner thereof during his lifetime. As coowners of the property, the heirs of Jose V. Ramirez, or any one of them, became personally vested
with right of legal redemption as soon as Mrs. Garnier sold her own pro-indiviso interest to Uy & Sons.
Even if subsequently, the undivided share of Ramirez (and of his heirs) should eventually be sold to
satisfy the creditors of the estate, it would not destroy their ownership of it before the sale, but would
only convey or transfer it as in turn sold (of it actually is sold) to pay his creditors. Hence, the right of
any of the Ramirez heirs to redeem the Garnier share will not be retroactively affected. All that the
law requires is that the legal redemptioner should be a co-owner at the time the undivided share of
another co-owner is sold to a stranger. Whether or not the redemptioner will continue being a coowner after exercising the legal redemptioner is irrelevant for the purposes of law.
Nor it can be argued that if the original share of Ramirez is sold by the administrator, his heirs would
stand in law as never having acquired that share. This would only be true if the inheritance is
repudiated or the heir's quality as such is voided. But where the heirship is undisputed, the purchaser
of hereditary property is not deemed to have acquired the title directly from the deceased Ramirez,
because a dead man can not convey title, nor from the administrator who owns no part of the estate;
the purchaser can only derive his title from the Ramirez heirs, represented by the administrator, as
their trustee or legal representative.
The right of appellant Angela M. Butte to make the redemption being established, the next point of
inquiry is whether she had made or tendered the redemption price within the 30 days from notices as
prescribed by law. This period, be it noted, is peremptory, because the policy of the law is not to leave
the purchaser's title in uncertainty beyond the established 30-day period. In considering whether or
not the offer to redeem was timely, we think that the notice given by the vendee (buyer) should not
be taken into account. The text of Article 1623 clearly and expressly prescribes that the thirty days
for making the redemption are to be counted from notice in writing by the vendor. Under the old law
(Civ. Code of 1889, Art. 1524), it was immaterial who gave the notice; so long as the redeeming coowner learned of the alienation in favor of the stranger, the redemption period began to run. It is thus
apparent that the Philippine legislature in Article 1623 deliberately selected a particular method of
giving notice, and that method must be deemed exclusive (39 Am. Jur., 237; Payne vs. State, 12 S.W.
[2d] 528). As ruled in Wampler vs. Lecompte, 150 Atl. 458 (affd. in 75 Law Ed. [U.S.] 275)
Why these provisions were inserted in the statute we are not informed, but we may assume until the
contrary is shown, that a state of facts in respect thereto existed, which warranted the legislature in
so legislating.
The reasons for requiring that the notice should be given by the seller, and not by the buyer, are
easily divined. The seller of an undivided interest is in the best position to know who are his coowners that under the law must be notified of the sale. Also, the notice by the seller removes all
doubts as to the fact of the sale, its perfection; and its validity, the notice being a reaffirmation
thereof, so that the party need not entertain doubt that the seller may still contest the alienation. This
assurance would not exist if the notice should be given by the buyer.
The notice which became operative is that given by Mrs. Chambers, in her capacity as attorney-infact of the vendor Marie Garnier Vda. de Ramirez. Under date of December 11, 1958, she wrote the
Administrator Bank of the Philippine Islands that her principal's one-sixth (1/6) share in the Sta. Cruz

property had been sold to Manuel Uy & Sons, Inc. for P500,000.00. The Bank received this notice on
December 15, 1958, and on the same day endorsed it to Mrs. Butte, care of Delgado, Flores and
Macapagal (her attorneys), who received the same on December 16, 1958. Mrs. Butte tendered
redemption and upon the vendee's refusal, judicially consigned the price of P500,000.00 on January
15, 1959. The latter date was the last one of the thirty days allowed by the Code for the redemption,
counted by excluding December 16, 1958 and including January 15, 1959, pursuant to Article 13 of
the Civil Code. Therefore, the redemption was made in due time.
The date of receipt of the vendor's notice by the Administrator Bank (December 15) can not be
counted as determining the start of thirty days; for the Administrator of the estate was not a proper
redemptioner, since, as previously shown, the right to redeem the share of Marie Garnier did not form
part of the estate of Jose V. Ramirez.
We find no jurisdiction for appellant's claim that the P500,000,00. paid by Uy & Sons, Inc. for the
Garnier share is grossly excessive. Gross excess cannot be predicated on mere individual estimates of
market price by a single realtor.
The redemption and consignation having been properly made, the Uy counterclaim for damages and
attorney's fees predicated on the assumption that plaintiff's action was clearly unfounded, becomes
untenable.
PREMISES CONSIDERED, the judgment appealed from is hereby reversed and set aside, and another
one entered:
(a) Declaring the consignation of P500,000,00 made by appellant Angela M. Butte duly and properly
made;
(b) Declaring that said appellant properly exercised in due time the legal redemption of the one-sixth
(1/6) undivided portion of the land covered by Certificate of Title No. 59363 of the Office of the
Register of Deeds of the City of Manila, sold on December 9, 1958 by Marie Garnier Vda. de Ramirez
to appellant Manuel Uy & Sons, Inc.
(c) Ordering appellant Manuel Uy & Sons, Inc. to accept the consigned price and to convey to Angela
M. Butte the undivided portion above referred to, within 30 days from the time our decision becomes
final, and subsequently to account for the rentals and fruits of the redeemed share from and after
January 15, 1958, until its conveyance; and.
(d) Ordering the return of the records to the court of origin for further proceedings conformable to this
opinion.
Without finding as to costs.
Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Barrera and Dizon, JJ., concur.
Paredes and De Leon, JJ., took no part

JURIDICAL PERSONS
BP 68 (CORPORATION CODE)
Section 2. Corporation defined. A corporation is an artificial being created by operation of law,
having the right of succession and the powers, attributes and properties expressly authorized by law
or incident to its existence. (2)
Section 4. Corporations created by special laws or charters. Corporations created by special laws or
charters shall be governed primarily by the provisions of the special law or charter creating them or
applicable to them, supplemented by the provisions of this Code, insofar as they are applicable. (n)
Section 17. Grounds when articles of incorporation or amendment may be rejected or disapproved.
The Securities and Exchange Commission may reject the articles of incorporation or disapprove any

amendment thereto if the same is not in compliance with the requirements of this Code: Provided,
That the Commission shall give the incorporators a reasonable time within which to correct or modify
the objectionable portions of the articles or amendment. The following are grounds for such rejection
or disapproval:
1. That the articles of incorporation or any amendment thereto is not substantially in accordance with
the form prescribed herein;
2. That the purpose or purposes of the corporation are patently unconstitutional, illegal, immoral, or
contrary to government rules and regulations;
3. That the Treasurers Affidavit concerning the amount of capital stock subscribed and/or paid is
false;
4. That the percentage of ownership of the capital stock to be owned by citizens of the Philippines has
not been complied with as required by existing laws or the Constitution.
No articles of incorporation or amendment to articles of incorporation of banks, banking and quasibanking institutions, building and loan associations, trust companies and other financial
intermediaries, insurance companies, public utilities, educational institutions, and other corporations
governed by special laws shall be accepted or approved by the Commission unless accompanied by a
favorable recommendation of the appropriate government agency to the effect that such articles or
amendment is in accordance with law. (n)
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-52179

April 8, 1991

MUNICIPALITY OF SAN FERNANDO, LA UNION, petitioner


vs.
HON. JUDGE ROMEO N. FIRME, JUANA RIMANDO-BANIA, IAUREANO BANIA, JR., SOR MARIETA
BANIA, MONTANO BANIA, ORJA BANIA, AND LYDIA R. BANIA, respondents.
Mauro C. Cabading, Jr. for petitioner.
Simeon G. Hipol for private respondent.

MEDIALDEA, J.:
This is a petition for certiorari with prayer for the issuance of a writ of preliminary mandatory
injunction seeking the nullification or modification of the proceedings and the orders issued by the
respondent Judge Romeo N. Firme, in his capacity as the presiding judge of the Court of First Instance
of La Union, Second Judicial District, Branch IV, Bauang, La Union in Civil Case No. 107-BG, entitled
"Juana Rimando Bania, et al. vs. Macario Nieveras, et al." dated November 4, 1975; July 13, 1976;
August 23,1976; February 23, 1977; March 16, 1977; July 26, 1979; September 7, 1979; November 7,
1979 and December 3, 1979 and the decision dated October 10, 1979 ordering defendants
Municipality of San Fernando, La Union and Alfredo Bislig to pay, jointly and severally, the plaintiffs for
funeral expenses, actual damages consisting of the loss of earning capacity of the deceased,
attorney's fees and costs of suit and dismissing the complaint against the Estate of Macario Nieveras
and Bernardo Balagot.
The antecedent facts are as follows:
Petitioner Municipality of San Fernando, La Union is a municipal corporation existing under and in
accordance with the laws of the Republic of the Philippines. Respondent Honorable Judge Romeo N.

Firme is impleaded in his official capacity as the presiding judge of the Court of First Instance of La
Union, Branch IV, Bauang, La Union. While private respondents Juana Rimando-Bania, Laureano
Bania, Jr., Sor Marietta Bania, Montano Bania, Orja Bania and Lydia R. Bania are heirs of the
deceased Laureano Bania Sr. and plaintiffs in Civil Case No. 107-Bg before the aforesaid court.
At about 7 o'clock in the morning of December 16, 1965, a collision occurred involving a passenger
jeepney driven by Bernardo Balagot and owned by the Estate of Macario Nieveras, a gravel and sand
truck driven by Jose Manandeg and owned by Tanquilino Velasquez and a dump truck of the
Municipality of San Fernando, La Union and driven by Alfredo Bislig. Due to the impact, several
passengers of the jeepney including Laureano Bania Sr. died as a result of the injuries they sustained
and four (4) others suffered varying degrees of physical injuries.
On December 11, 1966, the private respondents instituted a compliant for damages against the
Estate of Macario Nieveras and Bernardo Balagot, owner and driver, respectively, of the passenger
jeepney, which was docketed Civil Case No. 2183 in the Court of First Instance of La Union, Branch I,
San Fernando, La Union. However, the aforesaid defendants filed a Third Party Complaint against the
petitioner and the driver of a dump truck of petitioner.
Thereafter, the case was subsequently transferred to Branch IV, presided over by respondent judge
and was subsequently docketed as Civil Case No. 107-Bg. By virtue of a court order dated May 7,
1975, the private respondents amended the complaint wherein the petitioner and its regular
employee, Alfredo Bislig were impleaded for the first time as defendants. Petitioner filed its answer
and raised affirmative defenses such as lack of cause of action, non-suability of the State, prescription
of cause of action and the negligence of the owner and driver of the passenger jeepney as the
proximate cause of the collision.
In the course of the proceedings, the respondent judge issued the following questioned orders, to wit:
(1) Order dated November 4, 1975 dismissing the cross-claim against Bernardo Balagot;
(2) Order dated July 13, 1976 admitting the Amended Answer of the Municipality of San Fernando, La
Union and Bislig and setting the hearing on the affirmative defenses only with respect to the
supposed lack of jurisdiction;
(3) Order dated August 23, 1976 deferring there resolution of the grounds for the Motion to Dismiss
until the trial;
(4) Order dated February 23, 1977 denying the motion for reconsideration of the order of July 13,
1976 filed by the Municipality and Bislig for having been filed out of time;
(5) Order dated March 16, 1977 reiterating the denial of the motion for reconsideration of the order of
July 13, 1976;
(6) Order dated July 26, 1979 declaring the case deemed submitted for decision it appearing that
parties have not yet submitted their respective memoranda despite the court's direction; and
(7) Order dated September 7, 1979 denying the petitioner's motion for reconsideration and/or order
to recall prosecution witnesses for cross examination.
On October 10, 1979 the trial court rendered a decision, the dispositive portion is hereunder quoted
as follows:
IN VIEW OF ALL OF (sic) THE FOREGOING, judgment is hereby rendered for the plaintiffs, and
defendants Municipality of San Fernando, La Union and Alfredo Bislig are ordered to pay jointly and
severally, plaintiffs Juana Rimando-Bania, Mrs. Priscilla B. Surell, Laureano Bania Jr., Sor Marietta
Bania, Mrs. Fe B. Soriano, Montano Bania, Orja Bania and Lydia B. Bania the sums of P1,500.00
as funeral expenses and P24,744.24 as the lost expected earnings of the late Laureano Bania Sr.,
P30,000.00 as moral damages, and P2,500.00 as attorney's fees. Costs against said defendants.
The Complaint is dismissed as to defendants Estate of Macario Nieveras and Bernardo Balagot.

SO ORDERED. (Rollo, p. 30)


Petitioner filed a motion for reconsideration and for a new trial without prejudice to another motion
which was then pending. However, respondent judge issued another order dated November 7, 1979
denying the motion for reconsideration of the order of September 7, 1979 for having been filed out of
time.
Finally, the respondent judge issued an order dated December 3, 1979 providing that if defendants
municipality and Bislig further wish to pursue the matter disposed of in the order of July 26, 1979,
such should be elevated to a higher court in accordance with the Rules of Court. Hence, this petition.
Petitioner maintains that the respondent judge committed grave abuse of discretion amounting to
excess of jurisdiction in issuing the aforesaid orders and in rendering a decision. Furthermore,
petitioner asserts that while appeal of the decision maybe available, the same is not the speedy and
adequate remedy in the ordinary course of law.
On the other hand, private respondents controvert the position of the petitioner and allege that the
petition is devoid of merit, utterly lacking the good faith which is indispensable in a petition
for certiorari and prohibition. (Rollo, p. 42.) In addition, the private respondents stress that petitioner
has not considered that every court, including respondent court, has the inherent power to amend
and control its process and orders so as to make them conformable to law and justice. (Rollo, p. 43.)
The controversy boils down to the main issue of whether or not the respondent court committed
grave abuse of discretion when it deferred and failed to resolve the defense of non-suability of the
State amounting to lack of jurisdiction in a motion to dismiss.
In the case at bar, the respondent judge deferred the resolution of the defense of non-suability of the
State amounting to lack of jurisdiction until trial. However, said respondent judge failed to resolve
such defense, proceeded with the trial and thereafter rendered a decision against the municipality
and its driver.
The respondent judge did not commit grave abuse of discretion when in the exercise of its judgment
it arbitrarily failed to resolve the vital issue of non-suability of the State in the guise of the
municipality. However, said judge acted in excess of his jurisdiction when in his decision dated
October 10, 1979 he held the municipality liable for the quasi-delict committed by its regular
employee.
The doctrine of non-suability of the State is expressly provided for in Article XVI, Section 3 of the
Constitution, to wit: "the State may not be sued without its consent."
Stated in simple parlance, the general rule is that the State may not be sued except when it gives
consent to be sued. Consent takes the form of express or implied consent.
Express consent may be embodied in a general law or a special law. The standing consent of the
State to be sued in case of money claims involving liability arising from contracts is found in Act No.
3083. A special law may be passed to enable a person to sue the government for an alleged quasidelict, as in Merritt v. Government of the Philippine Islands (34 Phil 311). (see United States of
America v. Guinto, G.R. No. 76607, February 26, 1990, 182 SCRA 644, 654.)
Consent is implied when the government enters into business contracts, thereby descending to the
level of the other contracting party, and also when the State files a complaint, thus opening itself to a
counterclaim. (Ibid)
Municipal corporations, for example, like provinces and cities, are agencies of the State when they are
engaged in governmental functions and therefore should enjoy the sovereign immunity from suit.
Nevertheless, they are subject to suit even in the performance of such functions because their charter
provided that they can sue and be sued. (Cruz, Philippine Political Law, 1987 Edition, p. 39)
A distinction should first be made between suability and liability. "Suability depends on the consent of
the state to be sued, liability on the applicable law and the established facts. The circumstance that a
state is suable does not necessarily mean that it is liable; on the other hand, it can never be held

liable if it does not first consent to be sued. Liability is not conceded by the mere fact that the state
has allowed itself to be sued. When the state does waive its sovereign immunity, it is only giving the
plaintiff the chance to prove, if it can, that the defendant is liable." (United States of America vs.
Guinto, supra, p. 659-660)
Anent the issue of whether or not the municipality is liable for the torts committed by its employee,
the test of liability of the municipality depends on whether or not the driver, acting in behalf of the
municipality, is performing governmental or proprietary functions. As emphasized in the case of Torio
vs. Fontanilla (G. R. No. L-29993, October 23, 1978. 85 SCRA 599, 606), the distinction of powers
becomes important for purposes of determining the liability of the municipality for the acts of its
agents which result in an injury to third persons.
Another statement of the test is given in City of Kokomo vs. Loy, decided by the Supreme Court of
Indiana in 1916, thus:
Municipal corporations exist in a dual capacity, and their functions are twofold. In one they exercise
the right springing from sovereignty, and while in the performance of the duties pertaining thereto,
their acts are political and governmental. Their officers and agents in such capacity, though elected
or appointed by them, are nevertheless public functionaries performing a public service, and as such
they are officers, agents, and servants of the state. In the other capacity the municipalities exercise a
private, proprietary or corporate right, arising from their existence as legal persons and not as public
agencies. Their officers and agents in the performance of such functions act in behalf of the
municipalities in their corporate or individual capacity, and not for the state or sovereign power." (112
N.E., 994-995) (Ibid, pp. 605-606.)
It has already been remarked that municipal corporations are suable because their charters grant
them the competence to sue and be sued. Nevertheless, they are generally not liable for torts
committed by them in the discharge of governmental functions and can be held answerable only if it
can be shown that they were acting in a proprietary capacity. In permitting such entities to be sued,
the State merely gives the claimant the right to show that the defendant was not acting in its
governmental capacity when the injury was committed or that the case comes under the exceptions
recognized by law. Failing this, the claimant cannot recover. (Cruz, supra, p. 44.)
In the case at bar, the driver of the dump truck of the municipality insists that "he was on his way to
the Naguilian river to get a load of sand and gravel for the repair of San Fernando's municipal
streets." (Rollo, p. 29.)
In the absence of any evidence to the contrary, the regularity of the performance of official duty is
presumed pursuant to Section 3(m) of Rule 131 of the Revised Rules of Court. Hence, We rule that the
driver of the dump truck was performing duties or tasks pertaining to his office.
We already stressed in the case of Palafox, et. al. vs. Province of Ilocos Norte, the District Engineer,
and the Provincial Treasurer (102 Phil 1186) that "the construction or maintenance of roads in which
the truck and the driver worked at the time of the accident are admittedly governmental activities."
After a careful examination of existing laws and jurisprudence, We arrive at the conclusion that the
municipality cannot be held liable for the torts committed by its regular employee, who was then
engaged in the discharge of governmental functions. Hence, the death of the passenger tragic and
deplorable though it may be imposed on the municipality no duty to pay monetary compensation.
All premises considered, the Court is convinced that the respondent judge's dereliction in failing to
resolve the issue of non-suability did not amount to grave abuse of discretion. But said judge
exceeded his jurisdiction when it ruled on the issue of liability.
ACCORDINGLY, the petition is GRANTED and the decision of the respondent court is hereby modified,
absolving the petitioner municipality of any liability in favor of private respondents.
SO ORDERED.
Narvasa, Cruz, Gancayco and Grio-Aquino, JJ., concur.