Rule 6 (Provisional Case Notes)

CASE BRIEFS – REMEDIAL LAW REVIEW I 1
ARTURO C. ALBA, JR., duly represented by his attorneys-in-fact, ARNULFO B. ALBA and ALEXANDER C. ALBA,
Petitioner, vs. RAYMUND D. MALAPAJO, RAMIL D. MALAPAJO and the Register of Deeds for the City of Roxas,
Respondents. (G.R. No. 198752; 13 January 2016)
FACTS:
Petitioner Arturo C. Alba, Jr., duly represented by his attorneys-in-fact, Arnulfo B. Alba and Alexander C. Alba, filed
with the Regional Trial Court (RTC) of Roxas City, Branch 15, a Complaint against respondents Raymund D. Malapajo,
Ramil D. Malapajo and the Register of Deeds of Roxas City for recovery of ownership and/or declaration of nullity
or cancellation of title and damages. He alleges, among others, that he was the original owner of a parcel of land
purchased by the Malapajos. He maintains that the deed of sale, which caused the cancellation of the land’s title in
his name, was a forged document made by the Malapajoses. On the other hand, Raymund and Ramil Malapajos
filed their Answer with Counterclaim, in which they claim that they were innocent purchasers for value and that
the alleged forged document were presented to them already signed and notarized. They also aver that prior to the
alleged sale and on several occasions, Alba had obtained loans from them and their mother which were secured by
separate real estate mortgages that had never been discharged. They also allege that Alba acknowledged in par. 7
of his Complaint that the stated consideration in the Deed of Absolute Sale is P500,000.00 and he never
categorically denied having received the same. Also, they claim that before Alba sold the property to them, he
secured a loan from them in the sum of Six Hundred Thousand Pesos (P600,000.00) as evidenced by a Promissory
Note and secured by a Real Estate Mortgage covering the parcel of land subject of this case. Consequently, as
counterclaim, the Malapajos pray for damages and reimbursement of Alba’s loan from them (plus the agreed
monthly interest) in the event that the assailed deed of sale is proved to be null and void on the ground of forgery.
Petitioner filed a Motion to Set the Case for Preliminary Hearing, as if a Motion to Dismiss had been Filed, alleging
that respondents’ counterclaims are in the nature of a permissive counterclaim, thus, there must be payment of
docket fees and filing of a certification against forum shopping; and, that the supposed loan extended by
respondents’ mother to petitioner, must also be dismissed as respondents are not the real parties-in-interest.
Respondents filed their Opposition thereto. However, the RTC issued an Order denying Alba’s Motion, finding that
respondents’ counterclaims are compulsory. Alba’s motion for reconsideration was also denied. Aggrieved, Alba,
seeking to annul the RTC’s order, filed a petition for certiorari with the Court of Appeals (CA). Nonetheless, the CA
dismissed said petition. Undaunted by the CA’s dismissal of his Motion for Reconsideration, Alba now comes before
the Supreme Court to seek reversal of the appellate court’s decision.
ISSUE: Was Malapajo’s counterclaim a permissive one, which would require the payment of docket fees and
certification against non-forum shopping?
RULING:
No. The counterclaim of the Malapajoses are a compulsory one. As their counterclaim and Alba’s claims arise from
the same subject matter, the validity of the disputed deed of absolute sale, in which the evidence required to prove
their counterclaim would necessary disprove the latter’s claim.
Petitioner seeks to recover the subject property by assailing the validity of the deed of sale on the subject property
which he allegedly executed in favor of respondents Malapajo on the ground of forgery. Respondents
counterclaimed that, in case the deed of sale is declared null and void, they be paid the loan petitioner obtained
from them plus the agreed monthly interest which was covered by a real estate mortgage on the subject property
executed by petitioner in favor of respondents. There is a logical relationship between the claim and the
counterclaim, as the counterclaim is connected with the transaction or occurrence constituting the subject matter of
the opposing party's claim. Notably, the same evidence to sustain respondents' counterclaim would disprove
Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

petitioner's case. In the event that respondents could convincingly establish that petitioner actually executed the
promissory note and the real estate mortgage over the subject property in their favor then petitioner's complaint
might fail. Petitioner's claim is so related logically to respondents' counterclaim, such that conducting separate trials
for the claim and the counterclaim would result in the substantial duplication of the time and effort of the court and
the parties.
Since respondents' counterclaim is compulsory, it must be set up in the same action; otherwise, it would be barred
forever. If it is filed concurrently with the main action but in a different proceeding, it would be abated on the
ground of litis pendentia; if filed subsequently, it would meet the same fate on the ground of res judicata. There is,
therefore, no need for respondents to pay docket fees and to file a certification against forum shopping for the
court to acquire jurisdiction over the said counterclaim.
WHEREFORE, premises considered, the instant petition is PARTIALLY GRANTED. The Resolutions dated February 28,
2011 and August 31, 2011 issued by the Court of Appeals in CA-G.R. SP No. 05594 dismissing the petition for
certiorari and denying reconsideration thereof, respectively, for failure to show proper proof of service of the
petition to respondents, are SET ASIDE. Acting on the petition for certiorari, we resolve to DENY the same and
AFFIRM the Order dated June 4, 2010 of the Regional Trial Court of Roxas City, Branch 15, denying petitioner's
motion to set the case for hearing as if a motion to dismiss had been filed, and the Order dated September 30, 2010
denying reconsideration thereof.
SO ORDERED.

GR No. 155701, Mar 11, 2015 – LIM TECK CHUAN v. SERAFIN UY
FACTS:
One Antonio Lim Tanhu (Antonio), petitioner Lim Teck Chuan’s legitimate ascendant, owned a parcel of land
situated in Lapu-lapu City, Cebu. Based on records, Antonio, together with his wife, Dy Ochay, sold said land to
Spouses Francisco and Estrella Cabansag, as evidenced by a Deed of Sale executed on 8 January 1966. However,
due to Francisco Cabansag’s busy schedule and frequent travels abroad, he failed to transfer property’s title under
his name. Then, in 1988, Spouses Cabansag sold the same land to respondent Serafin Uy, as evidenced by a Deed
of Sale dated 18 April 1988. In order to have the title over the land transferred to Serafin’s name, the Cabansag
spouses endeavored to have the same transferred in their own name. However, they failed in doing so because
they allegedly lost the owner’s copy of the property’s title. This prompted Serafin to file a Cadastral case, praying
for the issuance of a new owner’s duplicate copy and the cancellation of the current title in the name of Antonio.
Initially, Serafin, by order of the Cadastral Court (RTC Lapu-lapu City) to the Register of Deeds, was granted a new
owner’s duplicate copy. However, the same order was nullified because Lim Teck Chuan (Chuan) filed an Opposition
/ Motion for Reconsideration with Manifestation for Special Apperance, alleging that he is one of Antonio’s six
legitimate descendants, and that the original owner’s copy was not lost because it is under his custody. Meanwhile,
one Henry Lim Ormoc, under the name of Lim Sing Chan and claiming that he is Antonio’s sole surviving heir,
executed an Affidavit of Sole Adjudication / Settlement of Estate of Antonio Lim Tanhu with Deed of Sale in favor
of one Leopolda Cecilio.
Because of the foregoing turn of events, Serafin then filed a case for quieting of title, surrender of owner’s copy of
the certificate of title, declaration of nullity of the affidavit of sole adjudication and deed of sale, and the annulment
of several tax declarations (under Leopolda’s name), and other reliefs with a prayer for preliminary injunction
before the RTC. To this complaint, both Leopolda and Chuan filed their respective counterclaims against Serafin, as
well as cross-claims against Henry Lim.
Eventually, after the conduct of pre-trial conference, the initial trial set by the RTC was postponed upon the
manifestation of Serafin’s and Leopolda’s respective counsel. According to them, there is an on-going negotiation
between the two for an amicable settlement. On the other hand, Chuan’s counsel manifested that Chuan was not
involved in such settlement. Eventually Serafin and Leopolda filed their Joint Motion to Dismiss, averring, among
others that they have amicably settled their differences over the subject property, in which Leopolda waived
whatever right she may have over, and that a new TCT was procured in their common names. Serafin also maintains
that Chuan’s claim on said property may be ventilated in an appropriate and independent action that he may iniate
in court. Consequently, they prayed for the dismissal of Serafin’s complaint, including all the counterclaims and
cross-claims attendant therein.
Chuan filed his opposition to said Joint Motion to Dismiss. However, the RTC granted the later and ruled adverse
against Chuan. The RTC, in dismissing the complaint, including Chuan’s counterclaim and cross-claim, opined that
the Joint Motion to Dismiss was proper in view of the fact that Serafin had already obtained all the reliefs he had
previously prayed for. The trial court went further and explained that nobody, not even the courts of justice, can
compel Serafin to continuously litigate his case even if he doesn’t want to do so anymore.
Undaunted, Chuan filed a petition for review on certiorari, under Rule 45, before the Supreme Court. He maintains
that the RTC was incorrect in dismissing his counterclaim and cross-claim despite his having seasonably filed his
opposition and expressed his preference to have such claims resolved in the same action.
ISSUE:

Was the RTC correct in dismissing Chuan’s counterclaims and crossclaims together with the dismissal of Uy’s
complaint?
RULING:
No; the RTC’s dismissal of Chuan’s counterclaims were incorrect in view of his timely motion to have the same
prosecuted in the same action between him and Uy. This is because the dismissal of the complaint does not
automatically result to the dismissal of the defendant’s counterclaim, regardless of whether such counterclaim is
compulsory or permissive, pursuant to Rule 17 of the Rules of Court.
The Supreme Court cited the following provisions of Rule 17 in ruling upon this case, to wit:
SECTION 1. Dismissal upon notice by plaintiff. A complaint may be dismissed by the plaintiff by filing a notice of
dismissal at any time before service of the answer or of a motion for summary judgment. Upon such notice being
filed, the court shall issue an order confirming the dismissal. Unless otherwise stated in the notice, the dismissal is
without prejudice, except that a notice operates as an adjudication upon the merits when filed by a plaintiff who
has once dismissed in a competent court an action based on or including the same claim.
SECTION 2. Dismissal upon motion of plaintiff. Except as provided in the preceding section, a complaint shall not be
dismissed at the plaintiff's instance save upon approval of the court and upon such terms and conditions as the
court deems proper. If a counterclaim has been pleaded by a defendant prior to the service upon him of the
plaintiff's motion for dismissal, the dismissal shall be limited to the complaint. The dismissal shall be without
prejudice to the right of the defendant to prosecute his counterclaim in a separate action unless within fifteen (15)
days from notice of the motion he manifests his preference to have his counterclaim resolved in the same action.
Unless otherwise specified in the order, a dismissal under this paragraph shall be without prejudice. A class suit
shall not be dismissed or compromised without the approval of the court.
SECTION 3. Dismissal due to fault of plaintiff. If, for no justifiable cause, the plaintiff fails to appear on the date of
the presentation of his evidence in chief on the complaint, or to prosecute his action for an unreasonable length of
time, or to comply with these Rules or any order of the court, the complaint may be dismissed upon motion of the
defendant or upon the court's own motion, without prejudice to the right of the defendant to prosecute his
counterclaim in the same or in a separate action. This dismissal shall have the effect of an adjudication
upon the merits, unless otherwise declared by the court.
SECTION 4. Dismissal of counterclaim, cross-claim, or third-party complaint. The provisions of this Rule shall apply
to the dismissal of any counterclaim, crossclaim, or third-party complaint. A voluntary dismissal by the claimant by
notice as in Section 1 of this Rule, shall be made before a responsive pleading or a motion for summary judgment
is served or, if there is none, before the introduction of evidence at the trial or hearing.
As can be gleaned from the assailed orders, the RTC erred when it dismissed the case when the present rules state
that the dismissal shall be limited only to the complaint. A dismissal of an action is different from a mere dismissal
of the complaint. For this reason, since only the complaint and not the action is dismissed, the defendant in spite
of said dismissal may still prosecute his counterclaim in the same action. The case of Pinga v. Heirs of German
Santiago is quite instructive which this Court finds worth reiterating.
In Pinga, the Court clearly stated that the dismissal of the complaint does not necessarily result to the dismissal of
the counterclaim, abandoning the rulings in Metals Engineering Resources Corporation v. Court of Appeals,

International Container Terminal Services, Inc. v. Court of Appeals, and BA Finance Corporation v. Co. The Court
held that:
“At present, even Section 2, concerning dismissals on motion of the plaintiff, now recognizes the right of the
defendant to prosecute the counterclaim either in the same or separate action notwithstanding the dismissal of
the complaint, and without regard as to the permissive or compulsory nature of the counterclaim.”
In his commentaries on the 1997 Rules of Civil Procedure, Justice Regalado expounds on the effects of the
amendments to Section 2 and 3 of Rule 17:
“Under this revised section, where the plaintiff moves for the dismissal of his complaint to which a counterclaim
has been interposed, the dismissal shall be limited to the complaint. Such dismissal shall be without prejudice to
the right of the defendant to either prosecute his counterclaim in a separate action or to have the same resolved
in the same action. Should he opt for the first alternative, the court should render the corresponding order granting
and reserving his right to prosecute his claim in a separate complaint. Should he choose to have his counterclaim
disposed of in the same action wherein the complaint had been dismissed, he must manifest such preference to
the trial court within 15 days from notice to him of plaintiff's motion to dismiss. These alternative remedies of the
defendant are available to him regardless of whether his counterclaim is compulsory or permissive. x x x.”
In the instant case, the petitioner's preference to have his counterclaim (and crossclaims) be prosecuted in the
same action was timely manifested. The records show that Serafin and Leopolda furnished the petitioner's counsel
with a copy of their Joint Motion to Dismiss by posting it (via registered mail) on September 19, 2001. Said motion
was filed in court the following day. On October 4, 2001, the petitioner filed his Opposition/Comment thereto.
Copies of the said opposition were personally served upon the opposing parties on the same date. In paragraph 1.5
of said opposition, the petitioner expressed his preference to have his counterclaim and crossclaim prosecuted in
the same case.
WHEREFORE, premises considered, the petition is PARTIALLY GRANTED. The Orders dated April 25, 2002 and
October 21, 2002 of the Regional Trial Court of Lapulapu City, Branch 27 in Civil Case No. 4786-L are MODIFIED in
that the counterclaim of Lim Teck Chuan as defendant in Civil Case No. 4786-L is REINSTATED. The Regional Trial
Court is ORDERED to hear and decide Lim Teck Chuan's counterclaim with dispatch.
SO ORDERED.

METROPOLITAN BANK AND TRUST COMPANY, Petitioner, v. CPR PROMOTIONS AND MARKETING, INC. AND SPOUSES
CORNELIO P. REYNOSO, JR. AND LEONIZA* F. REYNOSO, (G.R. No. 200567, June 22, 2015)
FACTS:
Respondent CPR Promotions and Marketing, Inc. (CPR Promotions) obtained loans, covered by 15 promissory notes.
from petitioner MBTC. These promissory notes (PNs) were all signed by respondents, spouses Leoniza F. Reynoso
(as Treasurer) and Cornelio P. Reynoso, Jr. (as President). These loans were secured by two (2) real estate mortgages
(REMs). All of the mortgaged properties are registered under the spouses Reynoso’s names, except for TCT No.
565381, which is registered under CPR Promotions. Thereafter, the spouses Reynoso executed a continuing surety
agreement binding themselves solidarily liable with CPR Promotions to pay any and all loans CPR Promotions may
have obtained from MBTC, including those covered by the said PNs, but not to exceed Php13,000,000. However,
upon maturity of said loans, CPR Promotions defaulted in payment. This prompted MBTC to file a petition for
extrajudicial foreclosure pursuant to Act no. 3135. The mortgaged properties were then sold in two public auctions,
both of which the MBTC emerged as the highest bidder. Notwithstanding the foreclosure of the mortgaged
properties for the total amount of Php 13,614,000, MBTC alleged that there remained a deficiency balance of Php
2,628,520.73, plus interest and charges as stipulated agreed upon in the PNs and deeds of real estate mortgages.
Despite MBTC’s repeated demands, however, respondents failed to settle the alleged deficiency. Thus, MBTC filed
an action for collection of sum of money against respondents before the Regional Trial Court of Makati City. For their
part, records reveal that respondents counterclaimed for moral and exemplary damages, as well as attorney’s fees.
The RTC ruled in favor of MBTC. Respondents timely moved for reconsideration, but the trial court denied the same.
Thereafter, they elevated the case to the Court of Appeals. At the appellate court’s level, realizing, based on its
computation, that is should have sought the recovery of the excess bid price, they set up another counterclaim.
This was duly considered by the CA and, consequently, ruled in favor of respondents, granting the latter its claim
for refund. Aggrieved by the CA’s decision, MBTC filed the present petition before the Supreme Court.
MBTC avers that the Court of Appeals abused its discretion in granting the refund claimed by respondents despite
the fact that the same was only set up when the case was then elevated to the CA.
ISSUES:
Was the Court of Appeals correct in granting CPR Promotions and Spouses Reynoso’s counterclaim for refund of
the excess bid price?
RULING:
No; the Court of Appeals was incorrect in granting the respondent’s counterclaim for refund. This is because such
counterclaim was only set up in the Appellant’s brief, contrary to what is required in setting up a compulsory
counterclaim, pursuant to Rule 11 of the Rules of Court.
In ruling upon the matter, the Supreme Court provides for the definition of compulsory counterclaim laid down by
Rule 6 of the Rules of Court, thus:
Rule 6 of the Rules of Court defines a compulsory counterclaim as follows:
Section 7. Compulsory counterclaim.—A compulsory counterclaim is one which, being cognizable by the regular
courts of justice, arises out of or is connected with the transaction or occurrence constituting the subject matter of

the opposing party’s claim and does not require for its adjudication the presence of third parties of whom the court
cannot acquire jurisdiction. Such a counterclaim must be within the jurisdiction of the court both as to the amount
and the nature thereof, except that in an original action before the Regional Trial Court, the counterclaim may be
considered compulsory regardless of the amount.
Accordingly, a counterclaim is compulsory if: (a) it arises out of or is necessarily connected with the transaction or
occurrence which is the subject matter of the opposing party’s claim; (b) it does not require for its adjudication the
presence of third parties of whom the court cannot acquire jurisdiction; and (c) the court has jurisdiction to
entertain the claim both as to its amount and nature, except that in an original action before the RTC, the
counterclaim may be considered compulsory regardless of the amount.
In determining whether a counterclaim is compulsory or permissive, the Court has, in several cases, utilized the
following tests:
(1) Are the issues of fact or law raised by the claim and the counterclaim largely the same?
(2) Would res judicata bar a subsequent suit on defendant’s claims, absent the compulsory counterclaim rule?
(3) Will substantially the same evidence support or refute plaintiff’s claim as well as the defendant’s
counterclaim?
(4) Is there any logical relation between the claim and the counterclaim, such that the conduct of separate
trials of the respective claims of the parties would entail a substantial duplication of effort and time by the
parties and the court? This test is the “compelling test of compulsoriness.” The only difference here would
be in the findings of the courts based on the evidence presented with regard to the issue of whether or not
the bid prices substantially cover the amounts due.
Based on the above tests, it is evident that a claim for recovery of the excess in the bid price vis-à-vis the amount
due should be interposed as a compulsory counterclaim in an action for recovery of a deficiency filed by the
mortgagee against the debtor-mortgagor. First, in both cases, substantially the same evidence is needed in order
to prove their respective claim. Second, adjudication in favor of one will necessarily bar the other since these two
actions are absolutely incompatible with each other; a debt cannot be fully paid and partially unpaid at the same
time. Third, these two opposing claims arose from the same set of transactions. And finally, if these two claims
were to be the subject of separate trials, it would definitely entail a substantial and needless duplication of effort
and time by the parties and the court, for said actions would involve the same parties, the same transaction, and
the same evidence. The only difference here would be in the findings of the courts based on the evidence presented
with regard to the issue of whether or not the bid prices substantially cover the amounts due.
Having determined that a claim for recovery of an excess in the bid price should be set up in the action for payment
of a deficiency as a compulsory counterclaim, we rule that respondents failed to timely raise the same.
It is elementary that a defending party’s compulsory counterclaim should be interposed at the time he files his
Answer, and that failure to do so shall effectively bar such claim.1 As it appears from the records, what respondents
initially claimed herein were moral and exemplary damages, as well as attorney’s fees. Then, realizing, based on its
computation, that it should have sought the recovery of the excess bid price, respondents set up another
counterclaim, this time in their Appellant’s Brief filed before the CA. Unfortunately, respondents’ belated assertion
proved fatal to their cause as it did not cure their failure to timely raise such claim in their Answer. Consequently,
respondents’ claim for the excess, if any, is already barred.
1Sec. 2, Rule 9, Rules of Court – A compulsory counterclaim, or a cross-claim, not set up shall be barred. (Read vis-à-vis Rule 11 – When to
File Responsive Pleadings).

WHEREFORE, premises considered, the instant petition is hereby PARTIALLY GRANTED. Accordingly, the Decision of
the Court of Appeals dated September 28, 2011 in CA-G.R. CV No. 91424 and its February 13, 2012 Resolution are
hereby AFFIRMED with MODIFICATION. The award of refund in favor of respondents in the amount of P722,602.22
with legal interest of six percent (6%) per annum is hereby DELETED.
No pronouncement as to costs.
SO ORDERED.
REPUBLIC OF THE PHILIPPINES, petitioner, vs. HONORABLE SANDIGANBAYAN (SPECIAL FIRST DIVISION),
FERDINAND E. MARCOS (REPRESENTED BY HIS ESTATE/HEIRS: IMELDA R. MARCOS, MARIA IMELDA

[IMEE] MARCOS-MANOTOC, FERDINAND R. MARCOS, JR. AND IRENE MARCOS-ARANETA) AND IMELDA
ROMUALDEZ MARCOS, respondents. (G.R. No. 152154. July 15, 2003)
FACTS:
Petitioner Republic of the Philippines (Republic), through Presidential Commission on Good Governance (PCGG)
filed a Petition for Forfeiture before the Sandiganbayan against the respondents Marcoses, pursuant to RA 1379,
in relation to Executive Order Nos. 1,[2] 2,[3] 14[4] and 14-A. The petition sought to declare the aggregate amount
of US$356 million (now estimated to be more than US$658 million inclusive of interest), which were previously
deposited in several Swiss accounts under various names of account holders, and subsequently deposited in escrow
in the PNB, as ill-gotten wealth. In addition, the petition sought the forfeiture of US$25 million and US$5 million in
treasury notes which exceeded the Marcos couples salaries, other lawful income as well as income from legitimately
acquired property. The treasury notes are frozen at the Central Bank of the Philippines, now Bangko Sentral ng
Pilipinas, by virtue of the freeze order issued by the PCGG.
Before the case was set for pre-trial, a General Agreement and the Supplemental Agreements were executed by
the Marcos children and then PCGG Chairman Magtanggol Gunigundo for a global settlement of the assets of the
Marcos family. Subsequently, respondent Marcos children filed a motion for the approval of said agreements and
for the enforcement thereof. The General Agreement/Supplemental Agreements sought to identify, collate, cause
the inventory of and distribute all assets presumed to be owned by the Marcos family under the conditions
contained therein.
Also, the following are the averments made by the Marcoses in their responsive pleadings before the
Sandiganbayan:
 Respondents specifically deny paragraph 5 of the Petition in so far as it states that summons and other
court processes may be served on Respondent Imelda R. Marcos at the stated address the truth of the
matter being that Respondent Imelda R. Marcos may be served with summons and other processes at No.
10-B Bel Air Condominium 5022 P. Burgos Street, Makati, Metro Manila, and ADMIT the rest;
 Respondents specifically DENY paragraph 12 of the Petition for lack of knowledge sufficient to form a belief
as to the truth of the allegation since Respondents were not privy to the transactions and that they cannot
remember exactly the truth as to the matters alleged.
 Respondents specifically DENY paragraph 13 of the Petition for lack of knowledge or information sufficient
to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the
contents of the alleged ITRs and Balance Sheet;
contents of the alleged ITRs.
 16. Respondents specifically DENY paragraph 17 of the Petition insofar as it attributes willful duplicity on
the part of the late President Marcos, for being false, the same being pure conclusions based on pure
assumption and not allegations of fact; and specifically DENY the rest for lack of knowledge or information

sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with
exactitude the contents of the alleged ITRs or the attachments thereto.
 17. Respondents specifically DENY paragraph 18 of the Petition for lack of knowledge or information
exactitude the contents of the alleged ITRs.
exactitude the contents of the alleged ITRs and that they are not privy to the activities of the BIR.
 22. Respondents specifically DENY paragraph 23 insofar as it alleges that Respondents clandestinely stashed
the country’s wealth in Switzerland and hid the same under layers and layers of foundation and corporate
entities for being false, the truth being that Respondents aforesaid properties were lawfully acquired.
 23. Respondents specifically DENY paragraphs 24, 25, 26, 27, 28, 29 and 30 of the Petition for lack of
knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents
were not privy to the transactions regarding the alleged Azio-Verso-Vibur Foundation accounts, except that
as to Respondent Imelda R. Marcos she specifically remembers that the funds involved were lawfully
acquired.
 24. Respondents specifically DENY paragraphs 31, 32, 33, 34, 35, 36,37, 38, 39, 40, and 41 of the Petition
for lack of knowledge or information sufficient to form a belief as to the truth of the allegations since
Respondents are not privy to the transactions and as to such transaction they were privy to they cannot
remember with exactitude the same having occurred a long time ago, except that as to Respondent Imelda
R. Marcos she specifically remembers that the funds involved were lawfully acquired.
 25. Respondents specifically DENY paragraphs 42, 43, 44, 45, and 46, of the Petition for lack of knowledge
or information sufficient to form a belief as to the truth of the allegations since Respondents were not privy
to the transactions and as to such transaction they were privy to they cannot remember with exactitude
the same having occurred a long time ago, except that as to Respondent Imelda R. Marcos she specifically
remembers that the funds involved were lawfully acquired; and
 26. Respondents specifically DENY paragraphs 49, 50, 51 and 52, of the Petition for lack of knowledge or
information sufficient to form a belief as to the truth of the allegations since Respondents were not privy
to the transactions and as to such transaction they were privy to they cannot remember with exactitude
the same having occurred a long time ago, except that as to Respondent Imelda R. Marcos she specifically
remembers that the funds involved were lawfully acquired.
Thereafter, the Republic filed a motion for summary stating that there is no genuine fact in issue since in all facts
have been admitted by the Marcoses’ based on their pleadings and other submissions during the pre-trial. The
Sandiganbayan initially ruled in its favor and granted the motion. The court found that there is no issue of fact that
calls for the presentation of evidence. Likewise, it declared all the funds mentioned above as ill-gotten wealth.
However, upon motion of respondent Marcoses, the Sandiganbayan reversed its decision. It opined that since there
is no proof of legal ownership by the Marcoses over the disputed funds, the same should be resolved through

presentation of evidence. Hence, it ordered dismissed the motion for summary judgement and instead ordered for
the proceedings to continue.
Aggrieved by said order, the Republic interposed the present petition before the Supreme Court.
ISSUE:
Was there grave abuse of discretion on the part of the Sandiganbayan when it ordered for the continuation of trial
instead of granting the motion for summary judgment?
RULING:
Yes. The Sandiganbayan gravely abused its discretion in denying the Republic’s Motion for Summary Judgment even
though there were no issues of genuine fact that would require the presentation of evidence, pursuant to Rule 35
of the Rules of Court and prevailing case laws.
The Supreme Court ruled, thus:
“We hold that respondent Marcoses failed to raise any genuine issue of fact in their pleadings. Thus, on motion of
petitioner Republic, summary judgment should take place as a matter of right.
In the early case of Auman vs. Estenzo, summary judgment was described as a judgment which a court may render
before trial but after both parties have pleaded. It is ordered by the court upon application by one party, supported
by affidavits, depositions or other documents, with notice upon the adverse party who may in turn file an opposition
supported also by affidavits, depositions or other documents. This is after the court summarily hears both parties
with their respective proofs and finds that there is no genuine issue between them. Summary judgment is
sanctioned in this jurisdiction by Section 1, Rule 35 of the 1997 Rules of Civil Procedure…
Upon careful perusal of the foregoing, the Court finds that respondent Mrs. Marcos and the Marcos children
indubitably failed to tender genuine issues in their answer to the petition for forfeiture. A genuine issue is an issue
of fact which calls for the presentation of evidence as distinguished from an issue which is fictitious and contrived,
set up in bad faith or patently lacking in substance so as not to constitute a genuine issue for trial. Respondents
defenses of lack of knowledge for lack of privity or (inability to) recall because it happened a long time ago or, on the
part of Mrs. Marcos, that the funds were lawfully acquired are fully insufficient to tender genuine issues. Respondent
Marcoses defenses were a sham and evidently calibrated to compound and confuse the issues.
In their answer, respondents failed to specifically deny each and every allegation contained in the petition for
forfeiture in the manner required by the rules. All they gave were stock answers like they have no sufficient
knowledge or they could not recall because it happened a long time ago, and, as to Mrs. Marcos, the funds were
lawfully acquired, without stating the basis of such assertions.
Section 10, Rule 8 of the 1997 Rules of Civil Procedure, provides:
A defendant must specify each material allegation of fact the truth of which he does not admit and, whenever
practicable, shall set forth the substance of the matters upon which he relies to support his denial. Where a
defendant desires to deny only a part of an averment, he shall specify so much of it as is true and material and shall
deny the remainder. Where a defendant is without knowledge or information sufficient to form a belief as to the
truth of a material averment made in the complaint, he shall so state, and this shall have the effect of a denial.

In their answer, respondents failed to specifically deny each and every allegation contained in the petition for
forfeiture in the manner required by the rules. All they gave were stock answers like they have no sufficient
knowledge or they could not recall because it happened a long time ago, and, as to Mrs. Marcos, the funds were
lawfully acquired, without stating the basis of such assertions.
Section 10, Rule 8 of the 1997 Rules of Civil Procedure, provides:
A defendant must specify each material allegation of fact the truth of which he does not admit and, whenever practicable, shall
set forth the substance of the matters upon which he relies to support his denial. Where a defendant desires to deny only a
part of an averment, he shall specify so much of it as is true and material and shall deny the remainder. Where a defendant is
without knowledge or information sufficient to form a belief as to the truth of a material averment made in the complaint, he
shall so state, and this shall have the effect of a denial.
The purpose of requiring respondents to make a specific denial is to make them disclose facts which will disprove
the allegations of petitioner at the trial, together with the matters they rely upon in support of such denial. Our
jurisdiction adheres to this rule to avoid and prevent unnecessary expenses and waste of time by compelling both
parties to lay their cards on the table, thus reducing the controversy to its true terms. As explained in Alonso vs.
Villamor, “A litigation is not a game of technicalities in which one, more deeply schooled and skilled in the subtle
art of movement and position, entraps and destroys the other. It is rather a contest in which each contending party
fully and fairly lays before the court the facts in issue and then, brushing aside as wholly trivial and indecisive all
imperfections of form and technicalities of procedure, asks that justice be done upon the merits. Lawsuits, unlike
duels, are not to be won by a rapiers thrust.
On the part of Mrs. Marcos, she claimed that the funds were lawfully acquired. However, she failed to particularly
state the ultimate facts surrounding the lawful manner or mode of acquisition of the subject funds. Simply put, she
merely stated in her answer with the other respondents that the funds were lawfully acquired without detailing
how exactly these funds were supposedly acquired legally by them. Even in this case before us, her assertion that
the funds were lawfully acquired remains bare and unaccompanied by any factual support which can prove, by the
presentation of evidence at a hearing, that indeed the funds were acquired legitimately by the Marcos family.
Respondents’ denials in their answer at the Sandiganbayan were based on their alleged lack of knowledge or
information sufficient to form a belief as to the truth of the allegations of the petition. It is true that one of the
modes of specific denial under the rules is a denial through a statement that the defendant is without knowledge
or information sufficient to form a belief as to the truth of the material averment in the complaint. The question,
however, is whether the kind of denial in respondents answer qualifies as the specific denial called for by the rules.
We do not think so. In Morales vs. Court of Appeals, this Court ruled that if an allegation directly and specifically
charges a party with having done, performed or committed a particular act which the latter did not in fact do,
perform or commit, a categorical and express denial must be made. Here, despite the serious and specific
allegations against them, the Marcoses responded by simply saying that they had no knowledge or information
sufficient to form a belief as to the truth of such allegations. Such a general, self-serving claim of ignorance of the
facts alleged in the petition for forfeiture was insufficient to raise an issue. Respondent Marcoses should have
positively stated how it was that they were supposedly ignorant of the facts alleged.
Therefore, the allegations in the petition for forfeiture on the existence of the Swiss bank deposits in the sum of about
US$356 million, not having been specifically denied by respondents in their answer, were deemed admitted by them
pursuant to Section 11, Rule 8 of the 1997 Revised Rules on Civil Procedure:

Material averment in the complaint, xxx shall be deemed admitted when not specifically denied.
By the same token, the following unsupported denials of respondents in their answer were pregnant with
admissions of the substantial facts alleged in the Republics petition for forfeiture: (See last four items in the bullets
above – in FACTS)…
The matters referred to in paragraphs 23 to 26 of the respondents answer pertained to the creation of five groups
of accounts as well as their respective ending balances and attached documents alleged in paragraphs 24 to 52 of
the Republics petition for forfeiture. Respondent Imelda R. Marcos never specifically denied the existence of the
Swiss funds. Her claim that the funds involved were lawfully acquired was an acknowledgment on her part of the
existence of said deposits. This only reinforced her earlier admission of the allegation in paragraph 23 of the petition
for forfeiture regarding the existence of the US$356 million Swiss bank deposits.
.
The allegations in paragraphs 47 and 48 of the petition for forfeiture referring to the creation and amount of the
deposits of the Rosalys- Aguamina Foundation as well as the averment in paragraph 52-a of the said petition with
respect to the sum of the Swiss bank deposits estimated to be US$356 million were again not specifically denied by
respondents in their answer. The respondents did not at all respond to the issues raised in these paragraphs and
the existence, nature and amount of the Swiss funds were therefore deemed admitted by them. As held in Galofa
vs. Nee Bon Sing, if a defendants denial is a negative pregnant, it is equivalent to an admission.
Moreover, respondents denial of the allegations in the petition for forfeiture for lack of knowledge or information
sufficient to form a belief as to the truth of the allegations since respondents were not privy to the transactions
was just a pretense. Mrs. Marcos privity to the transactions was in fact evident from her signatures on some of the
vital documents attached to the petition for forfeiture which Mrs. Marcos failed to specifically deny as required by
the rules.
It is worthy to note that the pertinent documents attached to the petition for forfeiture were even signed personally
by respondent Mrs. Marcos and her late husband, Ferdinand E. Marcos, indicating that said documents were within
their knowledge.
How could respondents therefore claim lack of sufficient knowledge or information regarding the existence of the
Swiss bank deposits and the creation of five groups of accounts when Mrs. Marcos and her late husband personally
masterminded and participated in the formation and control of said foundations? This is a fact respondent
Marcoses were never able to explain. Not only that. Respondents' answer also technically admitted the genuineness
and due execution of the Income Tax Returns (ITRs) and the balance sheets of the late Ferdinand E. Marcos and
Imelda R. Marcos attached to the petition for forfeiture, as well as the veracity of the contents thereof. The answer
again premised its denials of said ITRs and balance sheets on the ground of lack of knowledge or information
sufficient to form a belief as to the truth of the contents thereof. Petitioner correctly points out that respondents'
denial was not really grounded on lack of knowledge or information sufficient to form a belief but was based on lack
of recollection. By reviewing their own records, respondent Marcoses could have easily determined the genuineness
and due execution of the ITRs and the balance sheets. They also had the means and opportunity of verifying the same
from the records of the BIR and the Office of the President. They did not.
When matters regarding which respondents claim to have no knowledge or information sufficient to form a belief
are plainly and necessarily within their knowledge, their alleged ignorance or lack of information will not be
considered a specific denial. An unexplained denial of information within the control of the pleader, or is readily
accessible to him, is evasive and is insufficient to constitute an effective denial.

The form of denial adopted by respondents must be availed of with sincerity and in good faith, and certainly not
for the purpose of confusing the adverse party as to what allegations of the petition are really being challenged;
nor should it be made for the purpose of delay. In the instant case, the Marcoses did not only present
unsubstantiated assertions but in truth attempted to mislead and deceive this Court by presenting an obviously
contrived defense.
Simply put, a profession of ignorance about a fact which is patently and necessarily within the pleaders knowledge
or means of knowing is as ineffective as no denial at all.
Respondents’ ineffective denial thus failed to properly tender an issue and the averments contained in the petition
for forfeiture were deemed judicially admitted by them.
NELSON P. VALDEZ, petitioner, vs. ATTY. ANTOLIN ALLYSON DABON, JR., respondent. (A.C. No. 7353. November
16, 2015)
FACTS:

ISSUE:
RULING:

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CASE BRIEFS – REMEDIAL LAW REVIEW I 1

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

GR No. 155701, Mar 11, 2015 – LIM TECK CHUAN v. SERAFIN UY

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Rule 6 of the Rules of Court defines a compulsory counterclaim as follows:

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

The Supreme Court ruled, thus:

Section 10, Rule 8 of the 1997 Rules of Civil Procedure, provides:

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Section 10, Rule 8 of the 1997 Rules of Civil Procedure, provides:

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

Written by: MARIA KRISTINA D. SIUAGAN, RN (TINA SIUAGAN)

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