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Alday v. FGU Insurance

Corporation(January 23,2011)
DOCTRINE: In order for the trial
court to acquire
jurisdiction over her permissive
counterclaim, petitioner is
bound to pay the prescribed docket
fees. Such is not required
if counterclaim is compulsory.
NATURE: appeal from decision and
resolution of CA
PONENTE: Gonzaga-Reyes

Respondent FGU Insurance filed a

complaint with
the RTC of Makati alleging that
petitioner owed it
P114,650.76, which petitioner
incurred in the course of
her work as an insurance agent for
Respondent also prayed for
exemplary damages,
attorneys fees, and costs of suit.
Petitioner filed her answer and by
way of

counterclaim, asserted her right for

the payment of
P104,893.45, representing direct
commissions, profit

commissions and contingent

bonuses and for
accumulated premium reserves
amounting to
P500,000.00. She likewise prayed
for attorneys fees,
litigation expenses, moral damages
and exemplary
damages for the allegedly
unfounded action filed by
Respondent filed a Motion to Strike
Out Answer

With Compulsory Counterclaim And

to Declare
Defendant In Default because

petitioners answer was

allegedly filed out of time. TC denied
this and the
succeeding motion for
reconsideration. A motion to
dismiss petitioners counterclaim
was later on filed on
the ground of non-payment of
docket fees.
Petitioner asked the trial court to
declare her

exempt from payment of docket

fees since her
counterclaim is compulsory and that
respondent be
declared in default for having failed

to answer such
TC ruled in favor of the
respondents and ruled that

permissive in nature. Hence,

petitioners failure to pay
docket fees prevented the court
from acquiring. TC
denied succeeding motion for
reconsideration. CA
sustained the TC decision.
Supporting her claim that
counterclaim is

compulsory, petitioner alleged that

FGU has
unjustifiably failed to remit to

defendant despite
repeated demands in gross violation
of their Special
Agents Contract. CA found this
statement misleading
because while on one hand
appellant alleged that
appellees cause of action had
nothing to do with the
Special Agents Contract, on the
other hand, she claim
that FGU violated said contract.
Motion for
reconsireation was denied by CA.
1. Whether respondent is estopped

from questioning her nonpayment of docket for not raising it

on the first motion? No.
Estoppel by laches arises from the
negligence or omission to
assert a right within a reasonable
time. In the case at bar,
respondent cannot be considered as
estopped since this issue
was raised by respondent with the
trial court itself even
before the presentation of any
evidence by the parties and
before any judgment could be
rendered by the trial court.
2. Whether respondent is estoped

from questioning CA
jurisdiction over the appeal filed by
petitioner? Yes.
The objection to CAs jurisdiction is
raised for the first time
before this Court. Although the lack
of jurisdiction of a court
may be raised at any stage of the
action, a party may be
estopped from raising such
questions if he has actively taken
part in the very proceedings which
he questions, and then
belatedly objects to the courts
jurisdiction in the event that
that the judgment or order

subsequently rendered is adverse

to him. The respondent already took
active part in the CA
proceedings and already
demonstrated a willingness to abide
by the resolution of the case by
such tribunal. As such, it is
now estopped from objecting CAs
3. Whether or the counterclaim of
petitioner is
compulsory or permissive in nature?
A compulsory counterclaim is one
which arises out of or is
connected with the transaction or

occurrence constituting the

subject matter of the opposing
partys claim and does not
require for its adjudication the
presence of third parties of
whom the court cannot acquire
Tests to know if counterclaim is
permissive/ compulsory:
i.) Under Valencia v. Court of
a. Are the issues of fact and law
raised by the claim
and counterclaim largely the same?
b. Would res judicata bar a
subsequent suit on

defendants claim absent the

counterclaim rule?
c. Will substantially the same
evidence support or
refute plaintiffs claim as well as
d. Is there any logical relation
between the claim
and the counterclaim?
ii.) Compelling test of
compulsoriness (Quintanilla v. Court
of Appeals): Where conducting
separate trials of the
respective claims of the parties

would entail a substantial

duplication of effort and time by the
parties and the court.
Held 1: Petitioners counterclaim for
bonuses, and accumulated premium
reserves is merely
permissive. The evidence required
to prove petitioners
claims differs from that needed to
establish respondents
demands for the recovery of cash
accountabilities from
petitioner. The recovery of
respondents claims is not

contingent or dependent upon

establishing petitioners
counterclaim, such that conducting
separate trials will not
result in the substantial duplication
of the time and effort of
the court and the parties.
In order for the trial court to acquire
jurisdiction over her
permissive counterclaim, petitioner
is bound to pay the
prescribed docket fees.
Counterclaims, third-party claims
similar pleadings shall not be
considered filed until and

unless the filing fee prescribed

therefor is paid. However, its
non-payment does not result in the
automatic dismissal of the
case provided the docket fees are
paid within the applicable
prescriptive or reglementary period.
In this case, it has not been alleged
by respondent and there is
nothing in the records to show that
petitioner has attempted
to evade the payment of the proper
docket fees for her
permissive counterclaim. Trial court,
instead of dismissing
counterclaim, should have instead

given petitioner a
reasonable time to pay the filing
fees for her permissive
counterclaim, but in no case beyond
the applicable
prescriptive or reglementary period.
Held 2: Petitioners claims for
damages are compulsory.
There is no need for petitioner to
pay docket fees for her
compulsory counterclaim.
4.) Whether respondent should be
declared in default for
having failed to answer the
counterclaim? NO.
Insofar as the permissive

counterclaim of petitioner is
concerned, there is no need to file
an answer until petitioner
has paid the prescribed docket fees.
Meanwhile, the
compulsory counterclaim of
petitioner for damages need not
be answered since it is inseparable
from the claims of
DISPOSITION: CA Decision and
Resolution modified.
Compulsory counterclaim of
petitioner is ordered reinstated.
Meanwhile, Makati RTC is ordered to
require petitioner to

pay the docket fees for her

permissive counterclaim after
ascertaining that the applicable
prescriptive period has not
yet set in
Korea Technologies Co., Ltd. Vs. Hon. Albert
A. Lerma, et al.
Korea Technologies Co., Ltd. Vs. Hon. Albert A. Lerma, et al. , G.R. No. 143581. January 7, 2008
FACTS: Petitioner KOGIES and respondent PGSMC executed a Contract whereby KOGIES would set up
an LPG Cylinder Manufacturing Plant for respondent. Respondent unilaterally cancelled the contract on the
ground that petitioner had altered the quantity and lowered the quality of the machineries and equipment it
delivered. Petitioner opposed informing the latter that PGSMC could not unilaterally rescind their contract
nor dismantle and transfer the machineries and equipment on mere imagined violations by petitioner.
Petitioner then filed a Complaint for Specific Performance against respondent before the RTC. Respondent
filed its Answer with Compulsory Counterclaim asserting that it had the full right to dismantle and transfer
the machineries and equipment because it had paid for them in full as stipulated in the contract. KOGIES
filed a motion to dismiss respondents counterclaims arguing that when PGSMC filed the counterclaims, it
should have paid docket fees and filed a certificate of non-forum shopping, and that its failure to do so was
a fatal defect. The RTC dismissed the petitioners motion to dismiss respondents counterclaims as these
counterclaims fell within the requisites of compulsory counterclaims.
ISSUE: WON payment of docket fees and certificate of non-forum shopping were required in the
respondents Answer with counterclaim?
HELD: NO. The counterclaims of PGSMC were incorporated in its Answer with Compulsory Counterclaim
in accordance with Section 8 of Rule 11, 1997 Revised Rules of Civil Procedure, the rule that was effective
at the time the Answer with Counterclaim was filed. Sec. 8 on existing counterclaim or cross-claim states,
A compulsory counterclaim or a cross-claim that a defending party has at the time he files his answer shall
be contained therein. As to the failure to submit a certificate of forum shopping, PGSMCs Answer is not an
initiatory pleading which requires a certification against forum shopping under Sec. 524 of Rule 7, 1997
Revised Rules of Civil Procedure. It is a responsive pleading, hence, the courts a quo did not commit

reversible error in denying KOGIES motion to dismiss PGSMCs compulsory counterclaims. At the time
PGSMC filed its Answer incorporating its counterclaims against KOGIES, it was not liable to pay filing fees
for said counterclaims being compulsory in nature. We stress, however, that effective August 16, 2004
under Sec. 7, Rule 141, as amended by A.M. No. 04-2-04-SC, docket fees are now required to be paid in
compulsory counterclaim or cross-claims.

Ruby Shelter Builders (RSB) vs. Formaran

Post under case digests, Remedial Law at Posted bySchizophrenic Mind

Facts: RSB obtained a P95M loan in from Tan and Obiedo,

secured by REM over five parcels of land located in Naga City.
RSB failed to pay the loan despite being granted several
extensions. It was agreed that RSB should execute deeds of
absolute sale over the five parcel of lands in lieu of payment
Without payment having been made by RSB, Tan and Obiedo
presented the Deeds of Absolute Sale, as a result of which,
they were able to secure TCTs over the five parcels of land in
RSB filed before the RTC a Complaint against respondents
Tan and Obiedo for declaration of nullity of deeds of sales and
damages. RSBs causes of actions were: (a) pactum
commissorium; and (b) bad faith by Tan and Obediedo.
Upon filing its Complaint with the RTC, RSB paid the sum of
P13,644.25 for docket and other legal fees, as assessed by
the Office of the Clerk of Court. The Clerk of Court initially
considered the case as an action incapable of pecuniary
estimation and computed the docket and other legal fees due

thereon according to Section 7(b)(1), Rule 141 of the Rules of

Tan filed before the RTC an Omnibus Motion in which he
contended that the civil case involved real properties, the
docket fees for which should be computed in accordance with
Section 7(a), not Section 7(b)(1), of Rule 141 of the Rules of
Court, as amendedby A.M. No. 04-2-04-SC which took effect on
16 August 2004. Since petitioner did not pay the appropriate
docket fees for the civil case, the RTC did not acquire
jurisdiction over the said case. Hence, respondent Tan asked
the RTC to issue an order requiring RSB to pay the correct
and accurate docket fees and should RSB fail to do so, to
RTC ordered RSB to pay additional filing fee and Tan was also
ordered to pay docket and filing fees on his counterclaim.
CA upheld RTC, saying that the objectives of RSB in filing the
complaint were to cancel the deeds of sale and ultimately, to
recover possession of the same. It is therefore a real action.
Consequently, the additional docket fees that must be paid
cannot be assessed in accordance with Section 7(b). As a real
action, Section 7(a) must be applied in the assessment and
RTC, instead of dismissing outright RSBs Complaint, granted

RSB time to pay the additional docket fees. Despite the

seeming munificence of the RTC, petitioner refused to pay the
additional docket fees assessed against it, believing that it had
already paid the correct amount before, pursuant to Section
7(b)(1), Rule 141 of the Rules of Court, as amended.
Issue: For the purposes of paying the correct amount of
docket fees, whether or not the annulment of deed of
sale involving a real property is incapable of pecuniary
Held: No.





After Tan and Obiedo had the Deeds of Absolute Sale

presented to the Register of Deeds, they were already issued
TCTs over the real properties in question, in their own names.
No matter how fastidiously RSB attempts to conceal them, the
allegations and reliefs it sought in its Complaint appears to be
ultimately a real action, involving as they do the recovery by
RSM of its title to and possession of the five parcels of land
While it is true that RSB does not directly seek the recovery of
title or possession of the property in question, his action for
annulment of sale and his claim for damages are closely
intertwined with the issue of ownership of the building which,
under the law, is considered immovable property, the recovery

of which is RSB's primary objective. The prevalent doctrine is

that an action for the annulment or rescission of a sale of real
property does not operate to efface the fundamental and
prime objective and nature of the case, which is to recover
Considering that the complaint is a real action, the Rule
requires that "the assessed value of the property, or if there is
none, the estimated value thereof shall be alleged by the
claimant and shall be the basis in computing the fees.
A real action indisputably involves real property. The docket
fees for a real action would still be determined in accordance
with the value of the real property involved therein; the only
difference is in what constitutes the acceptable value. In
computing the docket fees for cases involving real properties,
the courts, instead of relying on the assessed or estimated
value, would now be using the fair market value of the real
properties (as stated in the Tax Declaration or the Zonal
Valuation of the Bureau of Internal Revenue, whichever is
higher) or, in the absence thereof, the stated value of the
Proton Pilipinas availed of credit facilities of
Banque Nacional de Paris (BNP).
Protons resulting debt of $2M was guaranteed
by Automotive Corporation Philippines, Asea
One Corp., and Autocorp Group.
BNP and Proton subsequently executed trust

receipt agreements, where Proton would

receive passenger motor vehicles in trust for
BNP, with the option to sell them, subject to
the condition that Proton would deliver the
proceeds of the sale to BNP, to be applied to
the formers debt. Vehicles remaining unsold
would be returned to BNP. Proton allegedly
failed to deliver.
BNP demanded from Protons corporate
guarantors $1.5M, the total outstanding
obligation. The guarantors refused. BNP filed a
complaint with the Makati RTC praying for
$1.5M plus accrued interest and other related
Respondent Proton filed a motion to dismiss,
contending that 1) BNP failed to pay the
correct docket fees which is supposed to
include interest, based on Admin Circ. No. 1194, and therefore the court could not have
acquired jurisdiction over the case, 2) the clerk
of court failed to apply the correct exchange rate, and that 3) since no demand letter was
given, the complaint was premature.
The court denied the petition, stating that the
petitioner properly paid the docket fees. It
stated that Section 7(a) of Rule 141 of the
Rules of Court excludes interest accruing from
the principal amount being claimed in the
pleading in the computation of the prescribed
filing fees. It court further added that
assuming the correct filing fees were not paid,
the rule is that the court may allow a
reasonable time for the payment of the
prescribed fees, or the balance thereof, and
upon such payment, the defect is cured and
the court may properly take cognizance of the
action, unless in the meantime prescription has
set in and consequently barred the right of
Regarding the correct dollar-peso rate of
exchange, the Office of the Clerk of Court of
the RTC of Makati pegged it at P 43.00 to
US$1. Absent any office guide of the rate of
exchange which said court functionary was
duty bound to follow, the rate he applied is
presumptively correct.
With regard to the demand letter, the court
said that the failure to make a formal demand
is not among the legal grounds for the
dismissal of the case.
1) Whether BNP failed to pay the correct docket
2) Whether the Clerk of court applied the wrong
exchange rate
3) Whether the amount of interest was not
specified in the prayer, rendering the
complaint void.
1) Petitioner relied on a case decided in 1989 where
Rule 141 was applied, the interest and costs
having been excluded in the computation of the
aggregate amount. However, the present case was
filed in 1998, when such rule had already been
amended by Administrative Circular No. 11-94.

The amended rule includes the interest, damages

of whatever kind, attorneys fees, litigation
expenses, and other costs in the computation of
the aggregate amount. In the complaint,
respondent prayed for accrued interest
subsequent to August 15, 1998 until fully paid.
The complaint having been filed on September 7,
1998, respondents claim includes the interest from
August 16, 1998 until such date of filing.
Respondent not having paid the fees for such,
cannot claim the interest within such duration,
unless respondent is allowed by motion to amend
its complaint within a reasonable time and specify
the precise amount of interest petitioners owe
within the period and pay the corresponding
docket fee.
With respect to the interest accruing after the filing
of the complaint, the same can only be determined
after a final judgment has been handed down.
Respondent cannot thus be made to pay the
corresponding docket fee. Pursuant, however, to
Section 2, Rule 141, as amended by Administrative
Circular No. 11-94, respondent should be made to
pay additional fees which shall constitute a lien in
the event the trial court adjudges that it is entitled
to interest accruing after the filing of the
2) In the Clerk of Courts application of exchange
rate, the presumption of regularity is disputable,
not conclusive. Petitioners have presented
rebutting evidence that the exchange rate when
the case was filed was P43.21 to US$1, not
P43.00. Thus, the docket fees were insufficient.
However, the trial court did acquire
jurisdiction. Respondent merely relied on the
assessment made by the Clerk of court. In such a
case, where there exists no effort in defrauding the
government, respondent even demonstrating his
willingness to abide by the rules by paying the
additional docket fees as required, the court
acquires jurisdiction.
3) Where the trial court acquires jurisdiction over a
claim by the filing of the appropriate pleading and
payment of the prescribed filing fee but,
subsequently, the judgment awards a claim not
specified in the pleading, or if specified, has been
left for determination by the court, the additional
filing fee shall constitute a lien on the judgment. It
shall be the responsibility of the Clerk of Court or
his duly authorized deputy to enforce said lien and
assess and collect the additional fee. The amount
of any claim for damages, therefore, arising on or
before the filing of the complaint or any pleading
should be specified. While the determination of
certain damages is left to the discretion of the
court, it is the duty of the parties claiming such
damages to specify the amount sought on the
basis of which the court may make a proper
determination, and for the proper assessment of
the appropriate docket fees. The exception to the
rule is limited only to any damages that may arise
after the filing of the complaint or similar pleading
for then it will not be possible for the claimant to
specify nor speculate as to the amount thereof.

Petition is partially granted. The Clerk of Court

is ordered to reassess and determine the docket
fees that should be paid by respondent within
fifteen (15) days, provided the applicable
prescriptive or reglementary period has not yet


- Ruby Shelter obtained a loan from Tan and
Obiedo secured by a REM consisting of 5
parcels of land in the name of the former.
- Despite an extension granted by Tan and
Obiedo and several negotiations, Ruby was not
able to pay.
- Hence, Tan and Obiedo, by virtue of a MOA,
executed Deeds of Absolute sale in their favor
covering the 5 parcels of land. The MOA
provided that if Ruby fails to pay the loan, 5
deeds of absolute sale would be executed in
favor of Tan and Obiedo.
- So Ruby Shelter filed complaint for declaration
of nullity of the deeds. Believing that their
action was one which was incapable of
pecuniary estimation, they paid docket fees
amounting to about 13K. It said that it only
wanted to annul the deeds so no issue of title
or recovery of possession is present to classify
it as a real action.
- Tan and Obiedo moved to dismiss the
complaint and ask for damages (also pursuant
to the MOA there was a provision that if
Ruby Shelter brought suit against them, it
would be liable for P 10M) contending that the
RTC did not acquire jurisdiction over the case
because the case involved recovery of real
property making it a real action which requires
payment of docket fees equivalent to a
percentage of the fair market value of the land
(P 700K).
- RTC and CA ruled in favor of Tan and Obiedo
ordering Ruby Shelter to pay additional docket
fees. Hence, this petition.
ISSUE: W/N Ruby Shelter should pay additional docket
HELD/RATIO: YES. For the court to acquire jurisdiction,
docket fees must be paid first. Payment is mandatory
and jurisdictional.
To determine whether an action is real, it must affect
title to or recovery of possession of real property. In
this case, Ruby Shelter did not disclose certain facts
which would classify the complaint it filed as a real
action (like the execution of deeds of sale pursuant to
a MOA). The action was really one for recovery of
possession of the parcels of land. Hence, it is a real
The docket fees for cases involving real property
depend on the fair market value (or the stated value)
of the same: the higher the value, the higher the fees
due. For those incapable of pecuniary estimation, a
fixed or flat rate is imposed.

St. Louis University, Inc. v. Cobarrubias [G.R. No. 187104. August 03, 2010]

[G.R. No. 187104. August 03, 2010]


INC., petitioner,

Respondent is an associate professor of the petitioner and an active member of the union of faculty and
employees. The Collective Bargaining Agreements contained the following provision that for teaching employees
in college who fail the yearly evaluation, who are retained for three (3) cumulative years in five (5) years, shall be
on forced leave for one (1) regular semester during which period all benefits due them shall be suspended.
Petitioner placed respondent on forced leave for failing to achieve the required rating points. Respondent sought
recourse from the CBAs grievance machinery, but to no avail. Respondent filed a case with DOLE but circulation
and mediation again failed. The parties submitted the issues between them for voluntary arbitration before
Voluntary Arbitrator (VA). Respondent argued that the CA already resolved the forced leave issue in a prior case
between the parties, ruling that the forced leave for teachers who fail their evaluation for three (3) times within a
five-year period should be coterminous with the CBA in force during the same five-year period. Petitioner argued
that said CA decision is not yet final. The VA dismissed the complaint. Respondent filed with the CA a petition for
review under Rule 43 of the Rules of Court but failed to pay the filing fees and to attach the material portion of
the records. Motion for reconsideration was filed, complying with the procedural lapses, and CA reinstated the
Remedial Law
(1) Whether or not the Court of Appeals erred in reinstating respondents petition despite her failure to appeal
(docket) fee within the reglementary period.
Remedial Law
(1) Yes. The CA erred in its ruling. Appeal is not a natural right but a mere statutory privilege, thus, appeal must
be made strictly in accordance with the provision set by law. Rule 43 of the Rules of Court provides that appeals
from the judgment of the VA shall be taken to the CA, by filing a petition for review within fifteen (15) days from
the receipt of the notice of judgment. Furthermore, upon the filing of the petition, the petitioner shall pay to the
CA clerk of court the docketing and other lawful fees; non-compliance with the procedural requirements
shall be a sufficient ground for the petitions dismissal. Thus, payment in full of docket fees within the
prescribed period is not only mandatory, but also jurisdictional. It is an essential requirement, without
which, the decision appealed from would become final and executory as if no appeal has been filed. Here, the
docket fees were paid late, and without payment of the full docket fees, Cobarrubias appeal was not perfected
within the reglementary period.
There are, however, there are recognized exceptions to their strict observance, such as: (1) most persuasive and
weighty reasons; (2) to relieve a litigant from an injustice not commensurate with his failure to comply with the
prescribed procedure; (3) good faith of the defaulting party by immediately paying within a reasonable time from
the time of the default; (4) the existence of special or compelling circumstances; (5) the merits of the case; (6) a

cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules; (7) a
lack of any showing that the review sought is merely frivolous and dilatory; (8) the other party will not be unjustly
prejudiced thereby; (9) fraud, accident, mistake or excusable negligence without the appellants fault; (10)
peculiar, legal and equitable circumstances attendant to each case; (11) in the name of substantial justice and
fair play; (12) importance of the issues involved; and (13) exercise of sound discretion by the judge, guided by all
the attendant circumstances. Thus, there should be an effort, on the part of the party invoking liberality, to
advance a reasonable or meritorious explanation for his/her failure to comply with the rules.
De La Cruz vs Joaquin

De La Cruz vs Joaquin : 162788 : July 28, 2005

FACTS: The case originated from a Complaint for the recovery of possession and ownership, the
cancellation of title, and damages, filed by Pedro Joaquin against petitioners in the RTC. The RTC ruled in
favor of respondent ordering herein petitioners to reconvey the property upon his payment. Petitioners
assert that the RTCs Decision was invalid for lack of jurisdiction claiming that respondent died during the
pendency of the case and there being no substitution by the heirs, the trial court allegedly lacked
jurisdiction over the litigation.
ISSUE: WON the trial court lost jurisdiction over the case upon the death of Pedro Joaquin?
HELD: NO. When a party to a pending action dies and the claim is not extinguished, the Rules of Court
require a substitution of the deceased. The procedure is specifically governed by Section 16 of Rule 3. The
rule on the substitution of parties was crafted to protect every partys right to due process. The estate of the
deceased party will continue to be properly represented in the suit through the duly appointed legal
representative. A formal substitution by heirs is not necessary when as in the present case, they
themselves voluntarily appear, participate in the case, and present evidence in defense of the deceased.
These actions negate any claim that the right to due process was violated. The records of the present case
contain a Motion for Substitution of Party Plaintiff filed before the CA. The rule on the substitution by heirs
is not a matter of jurisdiction, but a requirement of due process. Thus, when due process is not violated, as
when the right of the representative or heir is recognized and protected, noncompliance or belated formal
compliance with the Rules cannot affect the validity of a promulgated decision. Mere failure to substitute for
a deceased plaintiff is not a sufficient ground to nullify a trial courts decision. The alleging party must
prove that there was an undeniable violation of due process.

Domingo Carabeo entered into a contract "Kasunduan sa Bilihan ng Karapatan sa Lupa" with Sps Norberto and Susan
Peaches Dingco whereby Caraveo agreed to sell his rights over a 648 sq m unregistered land in Orani, Bataan for P38,000.
(initial payment of P10,000 upon signing of the contract, the remaining balance to be paid on Sept 1990).
Norberto & Dingco were later to claim that when they were about to hand in the balance of the purchase price,
Carabeo requested them to keep it first as he was yet to settle an on-going "squabble" over the land.

Norberto & Dingco gave Carabeo small sums of money from time to time which totaled P9,100, on Carabeos request
according to them; due to Norberto & Dingco inability to pay the amount of the remaining balance in full, according to
Despite the alleged problem over the land, they insisted on Carabeos acceptance of the remaining balance
of P18,900 but Carabeo remained firm in his refusal, proffering as reason that he would register the land first.
Sometime in 1994, Norberto & Dingco learned that the alleged problem over the land had been settled and that
Carabeo had caused its registration in his name on Dec 21, 1993. They offered to pay the balance but Carabeo declined,
drawing them to file a complaint before the Katarungan Pambarangay. No settlement was reached, however, hence, N & D
filed a complaint for specific performance before the RTC.

sale was void for lack of object certain, the kasunduan not having specified the metes and bounds of the land.

if the validity of the kasunduan is upheld, N & D failure to comply with their obligation to pay the balance of the

purchase price would render the action premature.


Carabeo maintained that they failed to pay the balance of P28,000 on Sept 1990 to thus constrain him to accept

installment payments totaling P9,100.

Carabeo passed away after the case was submitted for decision or on Jan 31, 2001, Records do not show that Carabeos
counsel informed the RTC where the complaint was lodged, of his death and that proper substitution was effected in
accordance with Section 16, Rule 3, Rules of Court.
Lower courts
RTC Ordered defendant to sell his right over 648 sq m of land pursuant to the contract dated July 10, 1990 by
executing a Deed of Sale thereof after the payment of P18,900 by the plaintiffs;
CA affirmed.
object certain of the contract
That the kasunduan did not specify the technical boundaries of the property did not render the sale a nullity. The
requirement that a sale must have for its object a determinate thing is satisfied as long as, at the time the contract is entered
into, the object of the sale is capable of being made determinate without the necessity of a new or further agreement
between the parties.
lack of spousal consent
This was raised only on appeal, hence, will not be considered, in the present case, in the interest of fair play, justice and due
carabeos death
Carabeos son: death of Carabeo causes the dismissal of the action filed by N & D; resp cause of action being an action in
Bonilla v. Barcena: The question as to whether an action survives or not depends on the nature of the action and the damage
sued for. In the causes of action which survive, the wrong complained [of] affects primarily and principally property and
property rights, the injuries to the person being merely incidental, while in the causes of action which do not survive, the
injury complained of is to the person, the property and rights of property affected being incidental.
Assuming arguendo, that the kasunduan is deemed void, there is a corollary obligation of Carabeo to return the money paid
by Norberto & Dingco, and since the action involves property rights, it survives.
Trial on the merits was already concluded before Carabeo died. Since the TC was not informed of Carabeos death, it
may not be faulted for proceeding to render judgment without ordering his substitution. Its judgment is thus valid and
binding upon Carabeos legal representatives orsuccessors-in-interest, insofar as his interest in the property subject of
the action is concerned.

The death of a client immediately divests the counsel of authority. Thus, in filing a Notice of Appeal, Carabeos counsel of
record had no personality to act on behalf of the already deceased client who, it bears reiteration, had not been substituted
as a party after his death. The TCs decision had thereby become final and executory, no appeal having been perfected.
Petition Denied.


Posted on by winnieclaire

FACTS: Respondent Karen T. Go filed two complaints before the RTC for replevin and/or sum of
money with damages against Navarro. In these complaints, Karen Go prayed that the RTC issue
writs of replevin for the seizure of two (2) motor vehicles in Navarros possession. In his Answers,
Navarro alleged as a special affirmative defense that the two complaints stated no cause of action, since
Karen Go was not a party to the Lease Agreements with Option to Purchase (collectively, the lease
agreements) the actionable documents on which the complaints were based. RTC dismissed the case
but set aside the dismissal on the presumption that Glenn Gos (husband) leasing business is a conjugal
property and thus ordered Karen Go to file a motion for the inclusion of Glenn Go as co-plaintiff as per Rule
4, Section 3 of the Rules of Court. Navarro filed a petition for certiorari with the CA. According to Navarro,
a complaint which failed to state a cause of action could not be converted into one with a cause of action
by mere amendment or supplemental pleading. CA denied petition.ISSUE: Whether or not Karen Go is a
real party in interest.
HELD: YES. Karen Go is the registered owner of the business name Kargo Enterprises, as the registered
owner of Kargo Enterprises, Karen Go is the party who will directly benefit from or be injured by a
judgment in this case. Thus, contrary to Navarros contention, Karen Go is the real party-in-interest, and it
is legally incorrect to say that her Complaint does not state a cause of action because her name did not
appear in the Lease Agreement that her husband signed in behalf of Kargo Enterprises.
Glenn and Karen Go are effectively co-owners of Kargo Enterprises and the properties registered under
this name; hence, both have an equal right to seek possession of these properties. Therefore, only one of
the co-owners, namely the co-owner who filed the suit for the recovery of the co-owned property, is an
indispensable party thereto. The other co-owners are not indispensable parties. They are not even
necessary parties, for a complete relief can be accorded in the suit even without their participation, since
the suit is presumed to have been filed for the benefit of all co-owners.
We hold that since Glenn Go is not strictly an indispensable party in the action to recover possession of
the leased vehicles, he only needs to be impleaded as a pro-forma party to the suit, based on Section 4,
Rule 4 of the Rules, which states:
Section 4.Spouses as parties. Husband and wife shall sue or be sued jointly, except as provided by law.
Even assuming that Glenn Go is an indispensable party to the action, misjoinder or non-joinder of
indispensable parties in a complaint is not a ground for dismissal of action as per Rule 3, Section 11 of the
Rules of Court.

Mandaue Galleon Trade Inc. vs. Isidto


G.R. No. 181051
July 5, 2010
Respondents, alleging that they were employees of petitioners, filed a case for illegal dismissal and nonpayment of, among others, overtime pay. They averred that they started working at Gamallo Sons, Inc. in
1977. In 1980, the firm name was changed to Gamallosons Traders, Inc. and eventually it became Mandaue
Galleon Trade, Inc. The employees suspected that the adoption and substitution of many firm names was
intended to subvert the labor standard benefits, status, terms, and conditions of employment.
In 1978, respondents were notified that the company adopted a policy of voluntary retrenchment but they did
not avail of the said plan. They asserted that, in 2001, they were dismissed from employment without just
cause and without due process.
The LA held that the respondents were illegally dismissed. Petitioners filed an appeal before the NLRC.
However, they failed to attach a certification of non-forum shopping to their notice of appeal so the NLRC
dismissed the petition and so did the CA.
ISSUE: WON the attachment of a certification of non-forum shopping in the notice of appeal may be
dispensed with in this case.
Section 4(a), Rule VI of The New Rules of Procedure of the NLRC10 prescribes, viz.:

SECTION 4. REQUISITES FOR PERFECTION OF APPEAL. - (a) The Appeal shall be filed within


reglementary period x x x shall be accompanied by x x x a certificate of non-forum shopping with proof of

service on the other party of such appeal x x x.
Based on the foregoing, a certificate of non-forum shopping is a requisite for the perfection of an appeal, and
non-compliance therewith shall not stop the running of the period for perfecting an appeal. The filing of a
certificate of non-forum shopping is mandatory in initiatory pleadings. The subsequent compliance with the
requirement does not excuse a partys failure to comply therewith in the first instance. In those cases where
the Court excused non-compliance with the requirement to submit a certificate of non-forum shopping, it
found special circumstances or compelling reasons which made the strict application of the Circular clearly

unjustified or inequitable. In this case, however, the petitioners offered no valid justification for their failure
to comply with the Circular.
Oaminal vs Castillo

Oaminal vs Castillo : 152776 : October 8, 2003

FACTS: Petitioner filed a complaint for collection against respondents with the RTC. The summons together
with the complaint was served upon the secretary of respondent. Respondents filed their Urgent Motion to
Declare Service of Summons Improper and Legally Defective alleging that the Sheriffs Return has failed to
comply on substituted service of summons but said motion was not heard due to the Judges absence.
Petitioner then filed an Omnibus Motion to Declare [Respondents] in Default and to Render Judgment
because no answer [was] filed by [the latter]. The respondents filed Omnibus Motion Ad Cautelam to Admit
Motion to Dismiss and Answer with. The judge denied [respondents] Motion to Dismiss, and admitted
[their] Answer. However six months after admitting their answer, the judge ruled that [respondents]
Omnibus Motion Ad Cautelam to Admit Motion to Dismiss and Answer with Counterclaim was filed outside
the period to file answer, hence he (1) denied the Motion to Admit Motion to Dismiss and Answer; (2)
declared [respondents] in default; and (3) ordered [petitioner] to present evidence ex-parte within ten days
from receipt of [the] order, [failing] which, the case will be dismissed.
ISSUE: WON respondents were properly declared in default?
HELD: NO. Respondents herein were declared in default by the trial court on May 22, 2001, purportedly
because of their delay in filing an answer. Its unexpected volte face came six months after it had ruled to
admit their Answer on November 16, 2000. Indiana Aerospace University v. Commission on Higher
Education held that no practical purpose was served in declaring the defendants in default when their
Answer had already been filed albeit after the 15-day period, but before they were declared as such.
Applying that ruling to the present case, we find that respondents were, therefore, imprudently declared in


Posted on by winnieclaire

[G.R. No. 181235. July 22, 2009.]FACTS: The Complaint alleges that J. O. Construction, Inc
(JOCI) entered into a contract with Duty Free Philippines, Inc. as actual construction went on,
progress billings were made. Payments were received by JOCI directly or through herein
respondent John Tansipek, its authorized collector. Payments received by respondent Tansipek were
initially remitted to JOCI. However, payment through PNB Check in the amount of P4,050,136.51 was not
turned over to JOCI but instead, Tansipek deposited the same to his account in PCIB. PCIB allowed the said
deposit, despite the fact that the check was crossed for the deposit to payees account only, and despite
the alleged lack of authority of Tansipek to endorse said check. PCIB refused to pay JOCI the full amount of
the check despite demands made by the latter.
PCIB filed a Motion to Dismiss the Complaint. The RTC denied PCIBs Motion to Dismiss.

PCIB filed a Motion to Admit Amended Third-Party Complaint. Upon Motion, respondent Tansipek was
granted time to file his Answer to the Third-Party Complaint. He was, however, declared in default for
failure to do so. The Motion to Reconsider the Default Order was denied. Upon being declared in default,
respondent Tansipek filed a Motion for Reconsideration of the Default Order. Upon denial thereof, Tansipek
filed a Petition for Certiorari with the Court of Appeals, which was dismissed for failure to attach the
assailed Orders. Respondent Tansipeks Motion for Reconsideration with the Court of Appeals was denied
for having been filed out of time.
ISSUE: Whether or not the motion for reconsideration of the default order was the correct remedy
HELD: NO. Respondent Tansipeks remedy against the Order of Default was erroneous from the very
beginning. Respondent Tansipek should have filed a Motion to Lift Order of Default, and not a Motion for
Reconsideration pursuant to Section 3 (b), Rule 9 of the Rules of Court.
A Motion to Lift Order of Default is different from an ordinary motion in that the Motion should
be verified; and must show fraud, accident, mistake or excusable neglect, and meritorious
defenses. The allegations of (1) fraud, accident, mistake or excusable neglect, and (2) of
meritorious defenses must concur.
It is important to note that a party declared in default respondent Tansipek in this case is not barred
from appealing from the judgment on the main case, whether or not he had previously filed a Motion to
Set Aside Order of Default, and regardless of the result of the latter and the appeals therefrom. However,
the appeal should be based on the Decisions being contrary to law or the evidence already presented,
and not on the alleged invalidity of the default order.