INTERPLEADER An action for interpleader is proper when the lessee does not

know the person to whom to pay rentals due to conflicting

6 OCAMPO v. TIRONA claims on the property.
1. Ocampo alleged that he is the owner of a parcel of land in Ocampo has the right to eject Tirona. There was unlawful
Pasay. He bought it from Breton, the heir of the lots registered detainer.
owner (Alipio Breton).
2. Possession and administration are already in Ocampos
management even though the TCT is not yet in his name.
3. Tirona, is a lessee occupying a portion of the subject land from
Breton-Mendiola (another heir).
4. Ocampo gave a formal written notice to Tirona about his
acquisition of the lot.
5. Tirona paid some of the monthly rentals due to Ocampo.
6. Ocampo later received a letter from Tironas counsel saying that
Tirona is invoking her right of first refusal since the property
was declared to be under priority development and will
temporarily stop paying for the monthly rentals.
7. Ocampo demanded for the payment of rentals and for Tirona to
vacate the premises. Tirona failed to heed the demands.
8. Ocampo filed a complaint for unlawful detainer against Tirona.
9. Tirona: Yanezas (allegedly the true owner) attorney in fact
recognizes Tirona as a co-owner by possession and ceded to
transfer the parcel in Tironas favor.
a. Tirona does not want to pay Ocampo because he is not
the true owner.
10. MTC: Tirona does not have any reason to suspend payment of
rents. Ocampo is entitled to use and enjoy the property and
recover it from any person unlawfully holding it.
11. Breton-Mendiola, who claimed to be the owner of the land, filed
a motion with leave to file intervention before the RTC.
12. RTC: Issued a writ of execution pending appeal to enforce MTC
decision. Denied intervention of Breton-Mendiola.
13. CA: Until the partition of the estate of Alipio is ordered pending
the partition proceedings, Ocampo cannot rightfully claim that
he bought is part of the property occupied by Tirona.
14. Ocampo is now questioning Tironas good faith in her
preference in paying rentals to Breton-Mendiola.

ISSUE: Whether Tirona should have filed a bill of interpleader to

settle her claim. YES.

As a stakeholder, Tirona should have used reasonable diligence

in hailing the contending claimants to court. Tirona need not
have awaited actual institution of a suit by Ocampo against her
before filing a bill of interpleader.
2 RCBC v. METRO CONTAINER CORPORATION interpleader who claims no interest whatever in the subject
1. Ley Construction (LeyCon) contracted a loan from RCBC (P30M). matter or an interest which is not disputed by the claimants.
The loan was secured with a REM over a property in Valenzuela. o The decision in Case 1 resolved the conflicting claims insofar
a. LeyCon failed to settle the obligation. Property was as payment of rentals was concerned.
foreclosed, RCBC won as highest bidder. RCBC is correct in saying that it is not bound by the decision in
b. LeyCon filed for nullification. Case 1 for not being a party thereto. But, it could not compel
c. Meanwhile, a new TCT was issued in RCBCs favor due to MetroCan to pursue Case 2.
LeyCons failure to redeem it.
2. RCBC then demanded rental payments from Metro Container
(MetroCan) which was leasing the property from LeyCon.
3. LeyCon filed an action for Unlawful Detainer against MetroCan.
(Case 1)
4. MetroCan filed a complaint for Interpleader against Leycon and
RCBC to determine which one should rightfully receive the
payment of monthly rentals. (Case 2)
5. Pre-trial, TC: Dismissed Case 2 for MetroCan and Leycon;
amicable settlement.
6. Case 1, TC: MetroCan ordered to pay LeyCon. This decision
became final and executory.
7. MetroCan moved for the dismissal of Case 2 for having been
moot and academic due to the amicable settlement. Leycon
also moved for dismissal, same grounds.
8. The MTDs were dismissed for lack of merit. MRs also denied.
9. CA: Ordered the dismissal of Case 2. RCBC moved for
reconsideration, denied.

ISSUE: Whether the interpleader action was already moot and

academic. YES.

LeyCon was claiming payment of rentals as lessor while RCBC

was making a demand by virtue of the consolidation of its title.
The reason for the interpleader action ceased when MTC
rendered a decision directing MetroCan to pay LeyCon.
o While RCBC is not a party to the case and could not be
bound by the judgment, MetroCan is bound by the decision.
o When it became executory, MetroCan has no other
alternative left but to pay the rentals to LeyCon.
MetroCan moved for the dismissal of the interpleader not
because it is no longer interested but because there is no more
need for it to pursue such cause of action.
An action of interpleader is afforded to protect a person not
against double liability but against double vexation in respect of
one liability.
o Indispensable requisite that conflicting claims upon the
same subject matter are made against the plaintiff-in-
Eternal Gardens v IAC
1. Petitioner Eternal Gardens Memorial Parks Corporation (EGMPC)
and private respondent North Philippine Union Mission
Corporation of the Seventh Day Adventists (MISSION for short)
are corporations duly organized and existing under and by
virtue of the laws of the Republic of the Philippines.
2. They executed a Land Development Agreement in 1976
whereby:
the former undertook to introduce and construct at its own
expense and responsibility necessary improvements on the
property owned by private respondent into a memorial park to
be subdivided into and sold as memorial plot lots, at a
stipulated area and price per lot.
a. Out of the proceeds from the sale, private respondent is
entitled to receive 40% of the net gross collection from the
project to be remitted monthly by petitioner to private
respondent through a designated depositary trustee bank.
3. On the same date private respondent executed in petitioner's
favor a Deed of Absolute Sale with Mortgage on the lots with
titles involved in the land development project. The deed was
supplemented by a Sale of Real Property with Mortgage and
Special Conditions dated 1978.
4. The amounts totalling about P984,110.82 paid by petitioner
were to be considered as part of the 40% due private
respondent under the Land Development Agreement.
5. All went well until Maysilo Estate asserted its claim of ownership
over the parcel of land in question.
6. G.R. No. 73569- Confronted with such conflicting claims,
petitioner as plaintiff filed a COMPLAINT FOR INTERPLEADER
against private respondent MISSION and Maysilo Estate, before
CFI of Rizal, Branch XII, Caloocan, alleging among others, that in
view of the conflicting claims of ownership of the defendants
over the properties subject matter of the contracts, over which
EGMPC has no claim of ownership except as a purchaser
thereof, and to protect the interests of EGMPC which has no
interest in the subject matter of the dispute and is willing to pay
whoever is entitled or declared to be the owners of said
properties, the defendants should be required to interplead and
litigate their several claims between themselves
7. G.R. No. 73569- Earlier on November 21, 1982, private
respondent presented a motion for the placing on judicial
deposit the amounts due and unpaid from petitioner. Acting on
such motion, the trial court denied judicial deposit in its order
dated February 13, 1984, because , due hearing of this court
has yet to be undergone in order to decide as to who is the true
owner which is a prejudicial question.
8. G.R. No. 73569- Another order dated October 26, 1984 was
issued amending the February 13, 1984 order directing the
MISSION to deposit the amounts it received under the
implementation of the LAND DEVELOPMENT AGREEMENT which
is not questioned by the plaintiff, Eternal Gardens, is hereby
ordered set aside for the reason that the titles to ownership, the
North Philippine Union Mission Corporation of Seventh Day
Adventists on the lots subject matter of the aforesaid
agreement is not established invalid, and the alleged titles of
intervenors are not proven yet by competent evidence;
9. In G.R. No. 73569 it appeared that on January 11, 1985,
MISSION filed a motion to dismiss the Interpleader and the
claims of the Maysilo Estate and the Intervenors and to order
the Eternal Gardens to comply with its Land Management with
MISSION.
10. G.R. No. 73569- The heirs of the Maysilo Estate moved for
reconsideration of the aforementioned order of dismissal, the
hearing of which was requested to be set on February, 28, 1985.
However, the trial judge, GRANTED the Motion for
Reconsiderations and instead of a hearing of the said motions
on February 20, 1985, at 8:30 a.m., a hearing on the merits
shall be held.
11. G.R. No. 73569- In spite of the February 14, 1985 order,
MISSION filed on March 6, 1985 a motion for Writ of Execution of
the resolution of January 28, 1985. This was denied on June 25,
1985. And furthered the case for pre-trial and trial
12. G.R. No. 73569- It was elevated on certiorari and mandamus to
the Intermediate Appellate Court. The petition was however
dismissed for want of merit
13. G.R. No. 73569- The private respondent challenged the above
decision by the petition for review on certiorari in the Supreme
Court but the latter dismissed it for lack of merit. Said resolution
has become final and executory on July 16, 1986.
14. G.R. No. 73794- Moreover, there is still a pending case in the
lower Court. This is a case for quieting of title filed by the heirs
of the late spouses Vicente Singson Encarnacion and Lucila
Conde. In this case, petitioner and private respondent were
named as defendants.
15. In the case at bar, G.R. No. 73794, MISSION, herein private
respondent filed a petition for certiorari with the then
Intermediate Appellate Court praying that the aforementioned
Orders of February 13, 1984 and October 26, 1984 of the
Regional Trial Court be set aside and that an order be issued to
deposit in court or in a depositor trustee bank of any and all
 payments, plus interest thereon, due the private respondent
MISSION under the Land Development Agreement, said
amounts deposited to be paid to whomever may be found later
to be entitled thereto, with costs. This was granted and the
Motion for REconsideration filed thereof by the aggrieved party
was denied.
Issue:
1. Whether or not respondent Court of Appeals abused its
discretion amounting to lack of jurisdiction in reconsidering its
resolution of February 27, 1985 and in requiring instead in the
resolution of September 5, 1985, that petitioner Eternal Gardens
deposit whatever amounts are due from it under the Land
Development Agreement with a reputable bank to be designated by
the respondent court.
3. As correctly observed by the Court of Appeals, the essence of an
interpleader, aside from the disavowal of interest in the property in
litigation on the part of the petitioner, is the deposit of the property
or funds in controversy with the court. it is a rule founded on justice
and equity: "that the plaintiff may not continue to benefit from the
property or funds in litigation during the pendency of the suit at the
expense of whoever will ultimately be decided as entitled thereto.
Issue#2:
1. The claim that this case should be barred by res judicata is even
more untenable.
2. A careful review of the records shows that there is no judgment
on the merits in G.R. No. 73569 and in the case at bar, G.R. No.
73794; both of which deal on mere incidents arising therefrom.

2. Whether or not the dismissal of AC-G.R. SP No. 06696 (North 3. In G.R. No 73569, the issue raised is the propriety of the grant of
Philippine Union Mission of the Seventh Day Adventists vs. Hon. the motion for reconsideration without a hearing thereon and the
Macandog, et al.) by the Second Special Cases Division of the IAC denial of the motion for execution, while in the case at bar, what is
which was affirmed by the Supreme Court in G.R. No. 73569 assailed is the propriety of the order of respondent appellant court
constitutes a basis for the dismissal of the case at bar on the that petitioner Eternal Gardens should deposit whatever amounts
ground of res adjudicata. are due from it under the Land Development Agreement with a
reputable bank to be designated by the Court. In fact, there is a
Held: pending trial on the merits in the trial court which the petitioner
1. No. insists is a prejudicial question which should first be resolved.
2. Yes. Moreover, while there may be Identity of parties and of subject
matter, the Land Development Contract, there is no Identity of
Ratio: issues as clearly shown by the petitions filed.
Issue#1:
1. In the case at bar, a careful analysis of the records will show that
petitioner admitted among others in its complaint in Interpleader
that it is still obligated to pay certain amounts to private
respondent; that it claims no interest in such amounts due and is
willing to pay whoever is declared entitled to said amounts. Such
admissions in the complaint were reaffirmed in open court before
the Court of Appeals as stated in the latter court's resolution dated
September 5, 1985 in A.C. G.R. No. 04869

2. Under the circumstances, there appears to be no plausible

reason for petitioner's objections to the deposit of the amounts in
litigation after having asked for the assistance of the lower court by
filing a complaint for interpleader where the deposit of aforesaid
amounts is not only required by the nature of the action but is a
contractual obligation of the petitioner under the Land
Development Program
REYES vs. LIM
1. Petitioner Reyes filed before the trial court a complaint for
Annulment of Contract and Damages against Respondents Lim,
Keng and Harrison Lumber.
2. The complaint alleged that Petitioner Reyes was the Seller and
Respondent Lim was the buyer. They entered into Contract to
sell a parcel of land located in Pasay City.
3. Harrison Lumber occupied the property as Lessee with a
monthly rental of P35, 000.
4. Under the said contract to Sell the terms and conditions were:
a. P28,000,000 as total consideration price of the property,
b. P10,000,000 upon signing the contract
c. Balance o P18,000,000 shall be paid upon the complete
vacation of all the tenants or occupants of the property.
d. If tenants shall not vacate on the said date, VENDEE
shall withhold the payment or balance of P18M and the
VENDOR shall pay 4% per month based on the amount
of the down payment of P10M until complete vacation.
5. In the complaint Petitioner Reyes claimed that he informed
Harrison Lumber to vacate the property and if not will hold them
liable for the penalty of P400K.
6. Furthermore, it was alleged in the complaint that Respondent
Lim connived with Harrison Lumber not to vacate the property
until the P400K monthly penalty would accumulate to unpaid
purchase price of P18M. Harrison Lumber denied the connivance
with Resp. Lim.
7. Resp. Lim in his answer states that he was ready and willing to
pay the balance price. Resp. Lim requested a meeting with
Reyes on the signing of the deed of Absolute Sale but Reyes
kept on postponing their meeting.
8. Petitioner Reyes offered to return the P10M downpyment to
Resp. Lim bec. Petitioner was having problems in removing the
lessee.
9. Resp. Lim rejected the offer and verified the status of Reyes
title. Resp. Lim learned that Reyes had already sold the property
to Line One.
10. Lim prayed for the cancellation of the Contract to Sell and for
the issuance of a writ of preliminary attachment against Reyes.
The trial court denied the prayer for a writ of preliminary
attachment.
11. Lim requested in open court that Reyes be ordered to deposit
the P10 million down payment with the cashier of the Regional
Trial Court of Paraaque. The trial court granted this motion.
12. In the same order, the trial court directed Reyes to deposit the
P10 million down payment with the Clerk of Court.
13. Reyes filed a Petition for Certiorari with the Court of Appeals for
orders amounting to grave abuse of discretion. The Court of
Appeals dismissed the petition for lack of merit.
ISSUE: Whether interpleader is applicable in this case? YES
HELD:
If left alone, the hiatus will result in unjust enrichment to
Reyes at the expense of Lim. This is not a case of equity overruling
a positive provision of law or judicial rule for there is none that
governs this particular case. This is a case of silence or insufficiency
of the law and the Rules of Court. In this case, Article 9 of the Civil
Code expressly mandates the courts to make a ruling despite the
silence, obscurity or insufficiency of the laws. This calls for the
application of equity, which fills the open spaces in the law.
Thus, the trial court in the exercise of its equity jurisdiction
may validly order the deposit of the P10 million down payment in
court. The purpose of the exercise of equity jurisdiction in this case
is to prevent unjust enrichment and to ensure restitution.
Reyes is seeking rescission of the Contract to Sell. In his
amended answer, Lim is also seeking cancellation of the Contract
to Sell. The trial court then ordered Reyes to deposit in court the
P10 million down payment that Lim made under the Contract to
Sell. Reyes admits receipt of the P10 million down payment but
opposes the order to deposit the amount in court.
Reyes sold to Line One the Property even before the balance
of P18 million under the Contract to Sell with Lim. Reyes cannot
claim ownership of the P10 million down payment because Reyes
had already sold to another buyer the Property for which Lim made
the down payment.
In Eternal Gardens Memorial Parks Corp. v. IAC, Court held
the plaintiff could not continue to benefit from the property or funds
in litigation during the pendency of the suit at the expense of
whomever the court might ultimately adjudge as the lawful owner.
The Court declared:
In the case at bar, a careful analysis of the records will show that
petitioner admitted among others in its complaint in Interpleader
that it is still obligated to pay certain amounts to private
respondent; that it claims no interest in such amounts due and is
willing to pay whoever is declared entitled to said amounts
The principle that no person may unjustly enrich himself at
the expense of another is embodied in Article 22 of the Civil Code.
This principle applies not only to substantive rights but also to
procedural remedies. One condition for invoking this principle is
that the aggrieved party has no other action based on contract,
quasi-contract, crime, quasi-delict or any other provision of law.
 Courts can extend this condition to the hiatus in the Rules of
Court where the aggrieved party, during the pendency of the case,
has no other recourse based on the provisional remedies of the
Rules of Court.
Thus, a court may not permit a seller to retain, pendente
lite, money paid by a buyer if the seller himself seeks rescission of
the sale because he has subsequently sold the same property to
another buyer. By seeking rescission, a seller necessarily offers to
return what he has received from the buyer. Such a seller may not
take back his offer if the court deems it equitable, to prevent unjust
enrichment and ensure restitution, to put the money in judicial
deposit.
In this case, it was just, equitable and proper for the trial
court to order the deposit of the P10 million down payment to
prevent unjust enrichment by Reyes at the expense of Lim.
1 WACK WACK GOLF v. WON/LEE and TAN
Wack Wack alleged the following for its first cause of action:
1. Won aka Lee claims ownership of a membership certificate
of Wack Wack Golf by virtue of a civil case (Lee v. Wack
Wack) decision in his favor.
2. Tan is also claiming ownership over the same certificate
pursuant to an assignment in his favor by the original owner.
For its second cause of action:
1. The certificate issued by the Clerk of Court in behalf of Wack
Wack (referring to the civil case where Lee got the
certificate) is null and void for violation of its by-laws which
require the surrender and cancellation of an outstanding
certificate before it could be transferred.
2. Tan is made a party because he refused to join Wack Wacks
action or bring a separate action to protect his rights.
PROCEDURAL FACTS:
1. Wack Wack filed a complaint for interpleader and prayed
that an order be issued requiring Lee and Tan to interplead
and for the Court to declare who is the lawful owner of the
certificate.
2. Lee and Tan moved to dismiss on the grounds of res
judicata, failure to state cause of action, and prescription.
3. TC: Dismissed Wack Wacks complaint based on res judicata
and failure to state CoA.
4. Wack Wack appealed: No res judicata because there is no
identity of parties, subject matter and cause of action with
the civil case.
ISSUE: Whether the remedy of interpleader is proper and timely.
NO.
RATIO:
An action of interpleader is a remedy whereby a person who has
personal property in his possession, or an obligation to render
wholly or partially, without claiming any right to either, comes
to court and asks that the persons who claim said personal
property or who consider themselves entitled to demand
compliance with the obligation, be required to litigate among
themselves in order to determine finally who is entitled to one
or the other thing.
The remedy is afforded to protect a person not against double
liability but against double vexation in respect of one liability.
An interpleader suit is proper on if the subject-matter is
personal property or related to the performance of an
obligation.
o The subject matter for this case, membership fee certificate,
is proper for an interpleader suit.
A stakeholder should file an action for interpleader within a
reasonable time after a dispute has arisen without waiting to be
sued, otherwise, he may be barred by laches and delay.
o If he acts with reasonable diligence, the remedy is not
barred.
In this case, there was no reasonable diligence because Wack
Wack was aware of the conflicting claims long before it filed an
interpleader suit.
o It has been recognizing Tan as the lawful owner.
o It was sued by Lee who also claimed the same certificate.
o Yet, it did not interplead Tan. It proceeded to litigate (civil
case) and to defend itself.
o Final judgment therein already became executory.
o TOO LATE TO INVOKE INTERPLEADER AS REMEDY.
A stakeholders action of interpleader is too late when filed after
judgment has been rendered against him in favor of one of the
contending claimants, especially where he had notice of the
conflicting claims prior to the rendition of the judgment and
neglected the opportunity to implead the adverse claimants in
the suit where judgment was entered.
Wack Wack was already liable to Lee under a final judgment
when he filed the interpleader.
He also did not offer any explanation for its failure to implead
Tan in the civil case.
 A successful litigant cannot later be impleaded by his defeated
adversary in an interpleader suit and compelled to prove his
claim again because that would be a collateral attack upon the
judgment.
8 MESINA v. IAC, GO and UY
1. Go purchased from Associated Bank a Cashiers Check for
P800k.
a. He left said check on top of the desk of the bank
manager when he left the bank.
2. The manager entrusted the check for safekeeping to Uy, a bank
official.
a. Uy was having a visitor (Lim) when the check was
entrusted.
b. Uy stepped out and when he came back, Lim was
already gone.
3. Go inquired about the check but it could not be found on Uys
folder or anywhere else.
4. Uy advised Go to accomplish a STOP PAYMENT order, which
Go immediately followed. He also executed an affidavit of loss.
5. Uy went to the police to report the loss pointing to the person of
Lim as the one who could explain the incident.
6. It was discovered that Associated Bank received the check for
clearing from Prudential Bank but Associated immediately
dishonored it and stopped payment.
7. Several days later, a certain Atty. Navarro demanded payment
on the cashiers check for his client. He threatened to sue if
demand is not heeded. Associated Bank told him that the check
belonged to Go.
8. Associated Bank filed an action for Interpleader naming Go and
John Doe (Navarros client) as respondents.
9. Associated Bank received the complaint for damages from
Mesina, prompting it to amend its complaint.
10. When Mesina was asked, he said that the check was paid to him
by Lim in a certain transaction.
11. An information for theft was instituted against Lim, warrant
issued but remains unserved because of Lims successful
evasion.
12. Go moved to participate as intervenor in the complaint for
damages.
13. Uy moved for intervention in the complaint for interpleader.
14. Mesina instead of filing an Answer, he filed an omnibus motion
to dismiss for lack of jurisdiction, failire to state cause of action,
lack of personality to sue.
15. Asociated Bank moved to dismiss the other civil case for
damages in view of the Interpleader case.
16. TC, Interpleader Case: Associated Bank has cause of action for
interpleader.
a. Mesina was declared in default for not filing Answer and
set the presentation of Associated Banks evidence.
17. Mesina filed a Pet. for Certiorari with IAC. Dismissed.
18. TC, Interpleader: Associate Bank shall replace the Cashiers
Check in favor of Go.
19. TC, Damages: Moot and academic. Already resolved in favor of
Go in the Interpleader suit.
20. Mesina appealed. He said the interpleader was not proper and
showed no conflicting claims. He shouldnt be declared in
default because there was no order for him to plead in the
interpleader case.
ISSUE: Whether the interpleader suit by the Bank was proper even
if there was already a claim for damages against it in a separate
case. YES.
RATIO:
Associated Bank merely took the necessary precaution not to
make a mistake as to whom to pay the amount.
Go and Mesina were both claiming based on the check.
Mesina argued that the interpleader relieved the Bank from
liability is wrong.
o Bank is willing to make a time deposit of P800k to the
clerk of court and award it to whoever will be found
entitled to it.
Bank filed the interpleader suit not because Mesina sued it but
because Mesina is laying claim to the same check that Go is
claiming.
When Bank instituted the interpleader, it was not aware of any
suit for damages filed against it. It was first addressed to a John
Doe.
An order to the parties named in a petition for interpleader to
file answer is an order to interplead. Non-answering party liable
to be declared in default.
4 ARREZA v. DIAZ
1. Bliss Development is the owner of a housing unit in QC.
2. A case was instituted involving the conflict of ownership
between Arreza and Diaz.
3. Bliss filed a complaint for interpleader.
4. TC: Interpleader is resolved in favor of Arezza. This became final
and duly executed with Bliss executing a Contract to Sell to
Arezza. Diaz was constrained to deliver the property with all its
improvements to Arreza.
5. Diaz filed a complaint against Bliss and Arreza seeking to hold
them liable to reimburse the cost of acquisition and
improvements on the property.
6. Arezza, MTD: Res judicata (interpleader case already resolved)
and lack of cause of action. Denied. Reconsideration.
7. CA: Dismissed Arezzas MR. The decision invoked as res judicata
resolved only the issue of who between Arezza and Diaz has the
better right over the property but not the rights and obligations
of the parties.
ISSUE: Whether Diazs claims for reimbursement against Arezza are
barred by res adjudicata since the complaint for interpleader had
already been resolved. YES.
Elements for res adjudicata:
o Former judgment must be final
o Court which rendered judgment has jurisdiction over the
parties and the subject matter
o Must be a judgment on the merits
o There must be between the 1 st and 2nd causes of action
identity of parties, subject matter, and cause of action.
The prior case for interpleader was settled with finality. The
judgment therein is now final.
RTC acquired jurisdiction over the parties and subject matter.
o Diazs contention that the TC did not acquire jurisdiction
(property is in QC, action was instituted in Makati) is wrong.
When he asserted his right as a buyer for value and in good
faith, and asking relief arising therefrom, he invoked the
jurisdiction of the RTC. Having invoked it by filing answer, he
is now estopped from challenging its jurisdiction.
There is an identity of causes of action.
o Diazs cause of action was in the nature of an unpleaded
compulsory counterclaim.
 There being a former final judgment on the merits in the prior
case, the case (for reimbursement) before the court should be
dismissed on the ground of res adjudicata.
DECLARATORY RELIEF
31 Tano v. Socrates
Petitioners in the case:
o First: Tano et. al. criminally charged with violation of the
ordinance;
o Second: Composed of 77 people and the Airline Shippers
Association of Palawan claiming to be fishermen.
Tano et al assail the constitutionality of several ordinances,
orders, and resolutions issued by the Sangguniang Panlungsod
of Puerto Princesa and of the Sangguniang Panlalawigan of
Palawan.
The assailed ordinances concern the ff: (1) The banning of
shipment of all live fish and lobster outside Puerto Princesa City
for 5 years; (2) Requiring a mayors permit to engage in such
trade; and (3) The prohibition of catching, gathering,
possessing, buying, selling and shipment of live marine coral.
The ordinances and resolutions were issued pursuant to LGC
468,(1)(VI) which authorizes the Sangguniang Panlalawigan to
protect the environment and impose appropriate penalties upon
acts which endanger the environment. (ex: dynamite fishing)
The issuances also rely on the general welfare clause of the
LGC, which provides that Every local government unit shall
exercise the powers expressly granted, those necessarily
implied therefrom, as well as powers necessary, appropriate, or
incidental for its efficient and effective governance; and those
which are essential to the promotion of the general welfare.
Tano et al argue that the Ordinances deprived them of due
process of law, their livelihood, and unduly restricted them from
the practice of their trade, in violation of Section 2, Article XII
and Sections 2 and 7 of Article XIII of the 1987 Constitution.
ISSUE/S: Whether or not the assailed ordinances and issuances are
unconstitutional.
HELD: NO, they are valid. Both Ordinances have two principal
objectives or purposes: (1) to establish a closed season for the
species of fish or aquatic animals covered therein for a period of
five years; and (2) to protect the coral in the marine waters of the
City of Puerto Princesa and the Province of Palawan from further
destruction due to illegal fishing activities. The accomplishment of
the first objective is well within the devolved power to enforce
fishery laws in municipal waters, such as P.D. No. 1015, which
allows the establishment of closed seasons. The devolution of
such power has been expressly confirmed in the Memorandum of
Agreement of 5 April 1994 between the Department of Agriculture
and the Department of Interior and Local Government. The
realization of the second objective falls within both the general
welfare clause of the LGC and the express mandate thereunder to
cities and provinces to protect the environment and impose
appropriate penalties for acts which endanger the environment.
PETITION DISMISSED.
RATIO:
Petitioners specifically point to Section 2, Article XII and
Sections 2 and 7, Article XIII of the Constitution as having been
transgressed by the Ordinances.
There is absolutely no showing that any of the petitioners
qualifies as a subsistence or marginal fisherman. In their
petition, petitioner Airline Shippers Association of Palawan is
described as a private association composed of Marine
Merchants; petitioners Robert Lim and Virginia Lim, as
merchants; while the rest of the petitioners claim to be
fishermen, without any qualification, however, as to their
status.
LGC 131(p) defines a marginal farmer or fisherman as an
individual engaged in subsistence farming or fishing which shall
be limited to the sale, barter or exchange of agricultural or
marine products produced by himself and his immediate
family. It bears repeating that nothing in the record supports a
finding that any petitioner falls within these definitions.
What we need to keep in mind is the state policy enshrined in
the Constitution regarding the duty of the State to protect and
advance the right of the people to a balanced and healthful
ecology in accord with the rhythm and harmony of nature.
The General Welfare clause of the LGC seeks to give
flesh and blood to the right of the people to a balanced
and healthful ecology.
It is important to note that LGC Section 5(c) explicitly mandates
that the general welfare provisions of the LGC shall be liberally
interpreted to give more powers to the local government units
in accelerating economic development and upgrading the
quality of life for the people of the community.
o The LGC vests municipalities with the power to grant
fishery privileges in municipal waters and to impose
rentals, fees or charges therefor; to penalize, by
appropriate ordinances, the use of explosives, noxious or
poisonous substances, electricity, muro-ami, and other
deleterious methods of fishing; and to prosecute any
violation of the provisions of applicable fishery laws.
 o Further, the sangguniang bayan, the sangguniang filed to allow the court concerned an opportunity to correct its
panlungsod and the sangguniang panlalawigan are errors, unless such motion may be dispensed with because of
directed to enact ordinances for the general welfare of existing exceptional circumstances. Finally, even if a motion for
the municipality and its inhabitants reconsideration has been filed and denied, the remedy under Rule
The centerpiece of LGC is the system of decentralization as 65 is still unavailable absent any showing of the grounds provided
expressly mandated by the Constitution. Indispensable thereto for in Section 1 thereof.[9] For obvious reasons, the petition at bar
is devolution and the LGC expressly provides that [a]ny does not, and could not have , alleged any of such grounds.
provision on a power of a local government unit shall be
liberally interpreted in its favor, and in case of doubt, any As to the second set of petitioners, the instant petition is obviously
question thereon shall be resolved in favor of devolution of one for DECLARATORY RELIEF, i.e., for a declaration that the
powers and of the lower local government unit. Any fair and Ordinances in question are a nullity ... for being unconstitutional. As
reasonable doubt as to the existence of the power shall be such, their petition must likewise fail, as this Court is not possessed
interpreted in favor of the local government unit concerned, of original jurisdiction over petitions for declaratory relief even if
One of the devolved powers enumerated in the section of the only questions of law are involved, it being settled that the Court
LGC on devolution is the enforcement of fishery laws in merely exercises appellate jurisdiction over such petitions
municipal waters including the conservation of mangroves. This
necessarily includes enactment of ordinances to effectively we opt to resolve this case on its merits considering that the
carry out such fishery laws within the municipal waters. lifetime of the challenged Ordinances is about to end. Ordinance
In light then of the principles of decentralization and devolution No. 15-92 of the City of Puerto Princesa is effective only up to 1
enshrined in the LGC and the powers granted to local government January 1998, while Ordinance No. 2 of the Province of Palawan,
units under Section 16 (the General Welfare Clause), and under enacted on 19 February 1993, is effective for only five (5) years.
Sections 149, 447 (a) (1) (vi), 458 (a) (1) (vi) and 468 (a) (1) (vi), Besides, these Ordinances were undoubtedly enacted in the
which unquestionably involve the exercise of police power, the exercise of powers under the new LGC relative to the protection
validity of the questioned Ordinances cannot be doubted. and preservation of the environment and are thus novel and of
paramount importance. No further delay then may be allowed in
As to the first set of petitioners, this special civil for the resolution of the issues raised.
certiorari must fail on the ground of prematurity amounting to a
lack of cause of action. There is no showing that the said
petitioners, as the accused in the criminal cases, have filed motions
to quash the informations therein and that the same were denied.
The ground available for such motions is that the facts charged
therein do not constitute an offense because the ordinances in
question are unconstitutional.[6] It cannot then be said that the
lower courts acted without or in excess of jurisdiction or with grave
abuse of discretion to justify recourse to the extraordinary remedy
of certiorari or prohibition. It must further be stressed that even if
the petitioners did file motions to quash, the denial thereof would
not forthwith give rise to a cause of action under Rule 65 of the
Rules of Court. The general rule is that where a motion to quash is
denied, the remedy therefrom is not certiorari, but for the party
aggrieved thereby to go to trial without prejudice to reiterating
special defenses involved in said motion, and if, after trial on the
merits of adverse decision is rendered, to appeal therefrom in the
manner authorized by law. And , even where in an exceptional
circumstance such denial may be the subject of a special civil
action for certiorari, a motion for reconsideration must have to be
2 VELARDE v. SOCIAL JUSTICE SOCIETY
FACTS:
1. SJS, a registered political party, filed a Petition for
Declaratory Relief before the RTC against Velarde and
others.
2. SJS sought the interpretation of several constitutional
provisions, specifically the separation of church and state;
and declaratory judgment on the constitutionality of the acts
of religious leaders endorsing a candidate for an elective
office, or requiring members of their flock to vote for a
specific candidate.
3. All respondents (head of churches) moved for the dismissal
of the petition.
4. The Trial Court discussed in great lengths the issue on
separation of church and state. It, however, failed to include
a dispositive portion.
5. Thus, Velarde and Soriano filed separate MRs. Denied.
6. Petition for Review with SC.
ISSUES:
1. Whether the Decision of the TC was valid. NO.
2. Whether there exists justiceable controversy in the Pet. for
Declaratory Relief. NO.
3. Whether SJS has legal interest in filing the Petition. NO.
No cause of action. The failure to state cause of action is a
ground for dismissal. However, in actions for declaratory relief,
the concept under ordinary civil actions does not strictly apply.
o Reason for exception: An action for declaratory relief
presupposes that there has been no actual breach of the
instrument involved and the rights arising thereunder.
o Nevertheless, a breach or violation should be impending,
imminent, or at least threatened.
o The SJS Petition did not disclose explicit allegation that it
had any legal right in its favor that it sought to protect.
No legal standing. No showing in the Petition that SJS that as a
political party, it would be adversely affected by vote
deprivation due to the acts imputed to the religious leaders.
The Petition does not even allege any indication or manifest
intent on the part of any of the respondents below to champion
an electoral candidate, or to urge their so-called flock to vote
for, or not to vote for, a particular candidate. It is a time-
honored rule that sheer speculation does not give rise to an
actionable right.
SJS Petition for Declaratory Relief is DISMISSED for failure to
state a cause of action.

RATIO:
The essential requisites of an action for declaratory relief are as
follows: (1) there is a justiciable controversy; (2) the
controversy is between persons whose interests are adverse;
(3) the party seeking the relief has a legal interest in the
controversy; and (4) the issue is ripe for judicial determination.
A justiciable controversy refers to an existing case or
controversy that is appropriate or ripe for judicial determination,
not one that is conjectural or merely anticipatory.
o SJSs petition fell short of this test.
o Failed to allege existing controversy or dispute between
them and the respondents they named.
o Did not state what specific right of SJS was violated and
what acts of those impleaded were in breach of its
rights, law, or Constitution.
o SJS merely speculated that as religious leaders, they had
threatened to endorse a candidate and that will enable
them to elect a person that will forever be beholden to
them, thus, they will be able to control the government.
1 ALMEDA v. BATHALA MARKETING INDUSTRIES
FACTS:
1. Bathala, as lessee, represented by Garcia, renewed its
Contract of Lease with Ponciano Almeda, as lessor.
2. Under the contract, Ponciano agreed to lease a portion of
the Almeda Compound for a monthly rental (P1M+) for four
years unless terminated sooner.
3. The contract of lease provided (conditions 6 and 7,
respectively):
a. Rental rate is based on the rate of assessment on the
property and in case it increases, or any new tax or
burden be imposed by authorities, the LESSEE shall
pay the additional rental and charge corresponding
to the portion leased. That in the event that the
assessment be reduced, lessee shall be entitled to
the reduction.
b. In case of extraordinary inflation or devaluation of
the Phil. Currency, the value of the Peso at the time
of the establishment of the obligation shall be the
basis of payment.
4. During the effectivity of the contract, Ponciano died.
5. The Almedas (wife and son of Pociano) informed Bathala
that they will collect VAT on its monthly rentals.
6. Bathala: VAT may not be imposed because the rentals fixes
in the contract already included VAT.
7. Another letter was sent to Bathala informing him that the
monthly rental should be increased by 73% because of
extraordinary inflation.
8. Bathala refused to pay VAT and adjusted rentals as
demanded but continued to pay the amount in the contract.
9. Bathala instituted an action for declaratory relief for
purposes of determining the correct interpretation of
Conditions Nos. 6 and 7 of the contract to prevent damage
and prejudice.
10. Almedas filed an action for ejectment for failure of Bathala
to vacate the premises.
11. Almedas later moved for the dismissal of the declaratory
relief case for being an improper remedy considering that
Bathala was already in breach of obligation and that the
case would not end the litigation. DENIED.
12. RTC: In favor of Bathala. VAT is not a new tax contemplated
in the 6th clause of the contract. No right to increase rental,
no ordinary inflation.
a. Because of the payment made by Bathalata of the
rental adjustment, the Court ordered the restitution
of the former amounts, notwithstanding the rule that
in an action for declaratory relief, affirmative reliefs
are not sought by or awarded to the parties.
13. CA: Affirmed, but the return of the balance of the rental
deposits and VAT and rental adjustment is deleted. RTC
exceeded authority granting affirmative relief of restituting
the excess payment.
ISSUE: Whether the declaratory relief was proper. YES.
RATIO:
Declaratory relief: an action by any person interested in a deed,
will, contract or other written instrument, executive order or
resolution, to determine any question of construction or validity
arising from the instrument, executive order or regulation, or
statute, and for a declaration of his rights and duties
thereunder.
Only issue that may be raised in such a petition is the question
of construction or validity of provisions in an instrument or
statute.
Requisites
o Subject matter: Deed, will, contract, other written
instrument, statute, EOs or regulation, ordinance.
o Terms of said documents and validity thereof are
doubtful and require judicial construction.
o There must have been no breach of the documents.
o An actual justiciable controversy
o Issue must be ripe for judicial determination
o Adequate relief is not available through other means or
other forms of action or proceeding.
After Almedas demanded payment of adjusted rentals, Bathala
complied with the terms set forth in the contract of lease by
paying the amounts stipulated therein, even during pendency of
case. There is no showing that Bathala breached the contract.
A petition for declaratory relief may not be dismissed despite
the filing of an action for rescission, ejectment and damages
where the trial court had not yet resolved the
rescission/ejectment case during the pendency of the
declaratory relief petition.
19 Kawasaki Port Services Co. v. Amores proceeding is unavailable where judgment would have to be
made, only after a judicial investigation of disputed issues
FACTS: No action in court has as yet ensued, foreign corporations
1. C.F. Sharp (Philippines), filed a complaint for injunction merely demanded from private respondent payment of the
and/or declaratory relief in CFI against 79 Japanese monetary obligations
corporations. The complaint alleges that he is a domestic The fact that C.F. Sharp (Philippines) is a separate entity, is a
corporation and there is another corporation named C.F. matter of defense that can be raised by the respondent at
Sharp (Japan), incorporated in Japan, and that these two are the proper time
in all respects separate and distinct from each other With regard to injunction, being a personal action, personal
2. C.F. Sharp (Japan) appears to have incurred obligations to or substituted service of summons on the defendants, not
several creditors, also foreign corporations. C.F. Sharp extraterritorial service, is necessary to confer jurisdiction on
(Japan) failed and refused to pay its creditors due to the court
financial difficulties, with that, the foreign creditors are now
claiming against C.F. Sharp (Philippines)
3. This is the reason why the declaration of relief was filed by
C.F. Sharp (Philippines)
4. Respondent filed for Extraterritorial Service of Summons
upon Defendants
5. Petitioner Kawasaki Port Services Corporation, et. al. filed a
Special Appearance to Question Jurisdiction of the Court
Over Persons of Defendants; action is in personam, no
property has been attached, and the action does not fall
within any of the four cases mention in Sec. 17, Rule 14 of
RC
6. Respondent Court denied said special appearances, hence
this petition

ISSUE: Whether or not private respondents complaint for

injunction and/or declaratory relief is within the purview of Sec. 17,
Rule 14 of RC. NO.

RATIO:
In the instant case, what is sought is a declaration for C.F.
Sharp (Philippines) is separate and distinct from C.F. Sharp
(Japan), not liable for the latter's indebtedness
It is evident that monetary obligations does not, in any way,
refer to status, rights and obligations.
The prevailing rule is that "where a declaratory judgment as
to a disputed fact would be determinative of issues rather
than a construction of definite stated rights, status and
other relations, commonly expressed in written instrument,
the case is not one for declaratory judgment."
Thus, considering the nature of a proceeding for declaratory
judgment, wherein relief may be sought only to declare
rights and not to determine or try issues, there is more valid
reason to adhere to the principle that a declaratory relief
TAMBUNTING vs. Sps. SUMABAT
1. This case involves a dispute over a parcel of land situated in
Caloocan City. It was previously registered in the names of
respondents, spouses Emilio Sumabat and Esperanza Baello.
2. Respondents mortgaged it to petitioner Antonio Tambunting, Jr.
to secure the payment of a P7,727.95 loan.
3. Respondents were informed that their indebtedness had
ballooned to P15,000 for their failure to pay the monthly
amortizations.
4. Respondents defaulted in their obligation, petitioner
Commercial House of Finance, Inc. (CHFI), as assignee of the
mortgage, initiated foreclosure proceedings on the mortgaged
property but the same did not push through.
5. Respondents filed an action for declaratory relief with the CFI of
Caloocan City, seeking a declaration of the extent of their actual
indebtedness.
6. Petitioners were declared in default for failure to file an answer
within the reglementary period. They moved for the dismissal of
the action on the ground that its subject, the mortgage deed,
had already been breached prior to the filing of the action.
7. CFI rendered its decision. It fixed respondents liability at
P15,743.83 and authorized them to consign the amount to the
court for proper disposition.
8. In compliance with the decision, respondents consigned the
required amount on January 9, 1981.
9. Respondent received a notice of sheriffs sale indicating that the
mortgage had been foreclosed by CHFI.
10. However, the public auction scheduled on that same day
proceeded and the property was sold to CHFI as the highest
bidder. Respondents failed to redeem the property during the
redemption period. Hence, title to the property was
consolidated in favor of CHFI and a new certificate of title was
issued in its name.
11. In view of these developments, respondents amended their
complaint to an action for nullification of foreclosure, sheriffs
sale and consolidation of title, reconveyance and damages.
12. RTC issued the assailed decision. It ruled that the 1981 CFI
decision in Civil Case (fixing respondents liability at P15,743.83
and authorizing consignation) had long attained finality. The
mortgage was extinguished when respondents paid their
indebtedness by consigning the amount in court. Moreover, the
ten-year period within which petitioners should have foreclosed
the property was already barred by prescription. They abused
their right to foreclose the property and exercised it in bad faith.
As a consequence, the trial court nullified the foreclosure and
extrajudicial sale of the property, as well as the consolidation of
title in CHFIs name in 1995. It then ordered the register of
deeds of Caloocan City to cancel TCT and to reconvey the
property to respondents. It also held petitioners liable for moral
damages, exemplary damages and attorneys fees.
Issue: Whether an action for declaratory relief is proper in this
case? NO
An action to enforce a right arising from a mortgage should
be enforced within ten years from the time the right of action
accrues. Otherwise, it will be barred by prescription and the
mortgage creditor will lose his rights under the mortgage.
Here, petitioners right of action accrued in May 1977 when
respondents defaulted in their obligation to pay their loan
amortizations. It was from that time that the ten-year period to
enforce the right under the mortgage started to run. The period
was interrupted when respondents filed Civil Case sometime after
May 1977 and the CFI restrained the intended foreclosure of the
property. However, the period commenced to run again on
November 9, 1977 when the case was dismissed.
The respondents institution of Civil Case in the CFI on March
16, 1979 did not interrupt the running of the ten-year prescriptive
period because, as discussed above, the court lacked jurisdiction
over the action for declaratory relief. All proceedings therein were
without legal effect. Thus, petitioners could have enforced their
right under the mortgage, including its foreclosure, only until
November 7, 1987, the tenth year from the dismissal of Civil Case
No. C-6329. Thereafter, their right to do so was already barred by
prescription.
The foreclosure held on February 8, 1995 was therefore
some seven years too late. The same thing can be said about the
public auction held on March 27, 1995, the consolidation of title in
CHFIs favor and the issuance of TCT in its name. They were all void
and did not exist in the eyes of the law.
TOPIC:
An action for declaratory relief should be filed by a person
interested under a deed, will, contract or other written instrument,
and whose rights are affected by a statute, executive order,
regulation or ordinance before breach or violation thereof. The
purpose of the action is to secure an authoritative statement of the
rights and obligations of the parties under a statute, deed, contract,
etc. for their guidance in its enforcement or compliance and not to
settle issues arising from its alleged breach. It may be entertained
only before the breach or violation of the statute, deed, contract,
etc. to which it refers. Where the law or contract has already been
contravened prior to the filing of an action for declaratory relief, the
court can no longer assume jurisdiction over the action.
In other words, a court has no more jurisdiction over an
action for declaratory relief if its subject, i.e., the statute, deed,
contract, etc., has already been infringed or transgressed before
the institution of the action. Under such circumstances, inasmuch
as a cause of action has already accrued in favor of one or the
other party, there is nothing more for the court to explain or clarify
short of a judgment or final order.
EXECUTIVE SECRETARY vs. SOUTHWING HEAVY
INDUSTRIES,INC.
President Gloria Macapagal-Arroyo, through Executive Secretary
Alberto G. Romulo, issued EO 156, entitled PROVIDING FOR A
COMPREHENSIVE INDUSTRIAL POLICY AND DIRECTIONS FOR
THE MOTOR VEHICLE DEVELOPMENT PROGRAM AND ITS
IMPLEMENTING GUIDELINES.
The issuance of EO 156 spawned three separate actions for
declaratory relief before the RTC Olongapo City, all seeking the
declaration of the unconstitutionality of Article 2, Section 3.1 of
said executive order.
The cases were filed by herein respondent entities, who or
whose members, are classified as Subic Bay Freeport
Enterprises and engaged in the business of, among others,
importing and/or trading used motor vehicles.
G.R. No. 164171: On January 16, 2004, respondents
Southwing Heavy Industries, Inc., (SOUTHWING) United
Auctioneers, Inc. (UNITED AUCTIONEERS), and Microvan, Inc.
(MICROVAN), instituted a declaratory relief case against:
Executive Secretary,
Secretary of Transportation and Communication,
Commissioner of Customs,
Assistant Secretary and Head of the Land
Transportation Office, Subic Bay Metropolitan
Authority (SBMA),
Collector of Customs for the Port at Subic Bay
Freeport Zone, and
the Chief of the Land Transportation Office at Subic
Bay Freeport Zone.
SOUTHWING, UNITED AUCTIONEERS and MICROVAN prayed that
judgment be rendered:
(1) declaring Article 2, Section 3.1 of EO 156
unconstitutional and illegal;
(2) directing the Secretary of Finance, Commissioner
of Customs, Collector of Customs and the Chairman
of the SBMA to allow the importation of used motor
vehicles; (2) ordering the Land Transportation Office
and its subordinates inside the Subic Special
Economic Zone to process the registration of the
imported used motor vehicles; and
(3) in general, to allow the unimpeded entry and
importation of used motor vehicles subject only to
the payment of the required customs duties.
G.R. No. 164172: On January 20, 2004, respondent Subic
Integrated Macro Ventures Corporation (MACRO VENTURES)
filed with the same trial court, a similar action for declaratory
relief, with the same prayer and against the same parties as
those in the first case. The trial court likewise rendered a
summary judgment, holding that Article 2, Section 3.1 of EO
156, is repugnant to the constitution. Elevated to this Court via
a petition for review on certiorari.
G.R. No. 168741. Two days later, respondent Motor Vehicle
Importers Association of Subic Bay Freeport, Inc.
(ASSOCIATION), filed another action for declaratory relief
with essentially the same prayer as those in the first two
against the same people. The court a quo granted the
ASSOCIATIONs prayer and declared the assailed proviso as
contrary to the Constitution
Aggrieved, the petitioners in the third Civil Case, filed a petition
for certiorari with the Court of Appeals which denied the petition
and sustained the finding of the trial court that Article 2, Section
3.1 of EO 156, is void for being repugnant to the constitution.
The decision of the Court of Appeals was elevated to the SC.
Said case was consolidated with the first two cases.
Petitioners: Article 2, Section 3.1 of EO 156 is valid and
applicable to the entire country, including the Freeport.
They raised procedural and substantive issues bearing on the
constitutionality of the assailed proviso.
The procedural issues are: the lack of respondents locus standi
to question the validity of EO 156, the propriety of
challenging EO 156 in a declaratory relief proceeding
and the applicability of a judgment on the pleadings in
this case.
Petitioner contends that Respondents will not be
affected by the importation ban considering that
their certificate of registration and tax exemption do
not authorize them to engage in the importation
and/or trading of used cars.
They also aver that the actions filed by respondents
do not qualify as declaratory relief cases. Section 1,
Rule 63 of the Rules of Court provides that a petition
for declaratory relief may be filed before there is a
breach or violation of rights
Petitioners claim that there was already a breach of
respondents supposed right because the cases were
filed more than a year after the issuance of EO 156.
In fact, in the third case, numerous warrants
of seizure and detention were issued against
imported used motor vehicles belonging to
respondent ASSOCIATIONs members.
ISSUE(S) WON there was a breach or violation of right caused by
the respondents. & Assuming that there is a breach, WON the
action filed by respondents do not qualify as Declaratory Relief
cases because of such breach.
HELD: YES. There was a breach. But they are still valid
declaratory relief cases.
WON it is a valid Declaratory Relief case:
1. As to the propriety of declaratory relief as a vehicle for assailing
the executive issuance, suffice it to state that any breach of the
rights of respondents will not affect the case.
2. In Commission on Audit of the Province of Cebu v. Province of
Cebu, the Court entertained a suit for declaratory relief
to finally settle the doubt as to the proper interpretation
of the conflicting laws involved, notwithstanding a
violation of the right of the party affected.
3. SC find no reason to deviate from said ruling mindful of the
significance of the present case to the national economy.
4. So also, summary judgments were properly rendered by the trial
court because the issues involved in the instant case were pure
questions of law.
5. A motion for summary judgment is premised on the assumption
that the issues presented need not be tried either because
these are patently devoid of substance or that there is no
genuine issue as to any pertinent fact.
6. It is a method sanctioned by the Rules of Court for the prompt
disposition of a civil action in which the pleadings raise only a
legal issue, not a genuine issue as to any material fact.
7. At any rate, even assuming the procedural flaws raised by
petitioners truly exist, the Court is not precluded from brushing
aside these technicalities and taking cognizance of the action
filed by respondents considering its importance to the public
and in keeping with the duty to determine whether the other
branches of the government have kept themselves within the
limits of the Constitution.
Martelino v NHMF Corp.
1 Petitioners alleged that they obtained housing loans from
respondents(NMFC- National Home Mortgage Finance
Corporation) who directly released the proceeds thereof to
the subdivision developer, Shelter Philippines, Inc. (Shelter).
2. Shelter failed to complete the subdivision according to its
representations and the subdivision plan. They were thus
compelled to spend their own resources to improve the
subdivision roads and alleys, and to install individual water
facilities
3. (Alleged lack of government oversight) Respondents, on
the other hand, failed to ensure Shelters completion of the
subdivision.
4. Instead, respondents ignored their right to suspend
amortization payments for Shelters failure to complete the
subdivision, charged interests and penalties on their
outstanding loans, threatened to foreclose their mortgages
and initiated foreclosure proceedings against petitioner
Rafael Martelino.
5. Hence, petitioners specifically sought a declaration from the
RTC (1) that their right as house and lot buyers to suspend
payment to Shelter for its failure to fully develop the
subdivision also applied to respondents who released their
loans directly to Shelter; and (2) that during the suspension
of payment, respondents should not assess them accrued
interests and penalties. Petitioners further prayed that they
be allowed to pay their housing loans without interest and
penalties.
6. RTC ruled that petitioners failed to state which section of the
law affected their rights and needed judicial declaration. The
RTC also noted that, as stated by petitioners, respondents
still foreclosed their mortgages, a breach of said law which
rendered the petition for declaratory relief improper. The
proper remedy was an ordinary civil action.
Issue: W/N Petitioners filing for declaratory relief was proper - NO
Ruling: Existence of a breach in contract-Petitioners already
violated( through the act of actual suspension of payments)
Hence, they cannot avail the remedy of declaratory relief,
because the remedy contemplates before any breach or
violation of a contract.
In this case, the petitioners had stated in their petition that
respondents assessed them interest and penalties on their
outstanding loans, initiated foreclosure proceedings against
petitioner Rafael Martelino as evidenced by the notice of
extrajudicial sale and threatened to foreclose the mortgages of the
other petitioners, all in disregard of their right to suspend payment
to Shelter for its failure to complete the subdivision. Said
statements clearly mean one thing: petitioners had already
suspended paying their amortization payments. Unfortunately, their
actual suspension of payments defeated the purpose of the action
to secure an authoritative declaration of their supposed right to
suspend payment, for their guidance. Thus, the RTC could no longer
assume jurisdiction over the action for declaratory relief because its
subject initially unspecified, now identified as P.D. No. 957 and
relied upon -- correctly or otherwise -- by petitioners, and assumed
by the RTC to be Rep. Act No. 8501, was breached before filing the
action.
Velasco vs. Villegas was then, so it has continued to be. There is no showing, therefore,
of the unconstitutionality of such ordinance.
1. This is an appeal from an order of the lower court dismissing a
suit for declaratory relief challenging the constitutionality based
on Ordinance No. 4964 of the City of Manila, the contention
being that it amounts to a deprivation of property of petitioners-
appellants of their means of livelihood without due process of
law.
2. The assailed ordinance is worded thus: "It shall be prohibited for
any operator of any barber shop to conduct the business of
massaging customers or other persons in any adjacent room or
rooms of said barber shop, or in any room or rooms within the
same building where the barber shop is located as long as the
operator of the barber shop and the rooms where massaging is
conducted is the same person."
3. As noted in the appealed order, petitioners-appellants admitted
that criminal cases for the violation of this ordinance had been
previously filed and decided.
The lower court, therefore, held that a petition for declaratory relief
did not lie, its availability being dependent on there being as yet
no case involving such issue having been filed.

Issue: WON the petitioners are entitled for declaratory relief? NO

Decision: Appealed order of Lower Court affirmed.

1. Even if such were not the case, the attack against the validity
cannot succeed. As pointed out in the brief of respondents-
appellees, it is a police power measure.
2. The objectives behind its enactment are:" (1) To be able to
impose payment of the license fee for engaging in the business
of massage clinic under Ordinance No. 3659 as amended by
Ordinance 4767, an entirely different measure than the
ordinance regulating the business of barbershops and, (2) in
order to forestall possible immorality which might grow out of
the construction of separate rooms for massage of customers."
3. This Court has been most liberal in sustaining ordinances based
on the general welfare clause. As far back as U.S. v. Salaveria, a
1918 decision, this Court through Justice Malcolm made clear the
significance and scope of such a clause, which "delegates in
statutory form the police power to a municipality. As above stated,
this clause has been given wide application by municipal
authorities and has in its relation to the particular circumstances of
the case been liberally construed by the courts. Such, it is well to
recall, is the progressive view of Philippine jurisprudence." As it
The Honorable Monetary Board vs. Philippine Veterans Bank
1. Phil. Veterans Bank (PVB) established a pension loan for
veterans or their surviving spouse, and salary loans for teachers
and low-salaried employees, pursuant of RA Nos. 3518 and
7169 to provide financial assistance. PVB devised the Credit
Redemption Fund (CRF) as its clientele dont have real property
for security. Special Trust Funds were established for the
pension loans.
2. This was managed by PVBs Trust Investment Department,
while the former is the beneficiary. The fees charged were
credited to the trust funds, which would pay the obligation in
case the burrowers die. The Supervision and Examination
Department (SED) II of Banko Sentral ng Pilipinas (BSP)
conducted an examination, which found that PVBs collection of
proceeds of salary and pension loans violate Sec. 54 of RA
8791, which states that banks shall not directly engage in
insurance business as insurer.
3. Respondent sent a letter, justifying the CRF. BSP replied with
the opinion of the Insurance Commission that the CRF is a form
of insurance. Thus, it was requested to be discontinued.
Respondent complied. Petitioners then issued Monetary Board
Resolution No. 1139, directing the respondents Trust and
Investment Department to return all the balance of the
burrowers of the CRF in the amount of P144, 713,224.54, and to
preserve the records of burrowers.
4. Respondent requested reconsideration, however it was denied.
Thus, the latter filed for declaratory relief before the RTC.
Petitioners then filed a motion to dismiss, alleging there is
already a breach of Sec. 54 of RA No. 8791. The RTC dismissed
the case. A year later, respondent filed a Motion to Admit its
Motion for Reconsideration on the order of the RTC, alleging that
they only received the copy on September 3, 2008. Petitioners
opposed the said motion, stating that the Order was received on
Oct. 17, 2007 (via Certification of the Philippine Postal Office).
5. The RTC allowed to admit the MR, which required petitioners to
file their answers. Subsequently, the RTC granted respondents
petition for declaratory relief. Petitioner filed for reconsideration,
however it was denied. Hence this petition for review.
Issue: Whether or not declaratory relief was proper in the present
case?
Ruling: No, it is not proper, the decision is reversed and set aside.
Ratio:
Declaratory relief is defined as an action by any person
interested in a deed, will, contract or other written
instrument, executive order or resolution, to determine any
question of construction or validity arising from the
instrument, executive order or regulation, or statute; and
for a declaration of his rights and duties thereunder . The
only issue to be raised in declaratory relief is the construction and
validity of the provisions in an instrument or statute.
In the case of CJH Development Corp. vs. BIR, the Court held
that court decisions as well as decisions of quasi-judicial
agencies cannot be the proper subjects of declaratory
relief. The reason is that, if a party does not agree with the
decision, either of question of law or fact, it may avail of various
remedies provided in the Rules of Court. The decision of the BSP
Monetary Board cannot be the subject of declaratory relief,
since it issued the decision, in exercise of its quasi-judicial
functions. The nature of the BSP Monetary Board as a quasi-
judicial agency and the character of its determination to sanction
erring banks was recognized by the Court in the case of United
Coconut Planters Bank v. E. Ganzon, Inc.
Under BP Blg. 129, Sec. 9(3), as amended, and Sec. 1, Rule
43 of the Rules of Civil Procedure, reveals that BSP Monetary board
is not one of those enumerated among those in the list, whose final
judgment, orders, resolution, or awards are not appealable to the
CA. Such omission is not necessary for the CA to exercise its
appellate jurisdiction. The word including in the said provision
provides that the list is not exclusive. Similarly, Sec. 1, of Rule 43
merely mentions quasi-judicial agencies, however, the phrase,
among these agencies highlights the intention of non-exclusivity.
A quasi-judicial agency is an organ of the government other
than the court or legislature, which affects rights by its adjudication
or rule-making. Administrative agencies is vested with quasi-judicial
functions. A quasi-judicial function is a term that applies to the
action or discretion of administrative officers or bodies as exercise
of its discretion of a judicial nature.